through the nationalization of industry; the fullest use of national
resources; higher wages; social services and insurance; a new tax
policy; and planned investment. There was to be extensive replanning of
the national economic effort and a "firm constructive government hand
on our whole productive machinery." The Labor Party's ultimate purpose
at home was "the establishment of a Socialist Commonwealth of Great
Britain--free, democratic, efficient, progressive, public spirited, its
material resources organized in the services of the British people."
In 1948 Harold Laski, the Labor Party's ideological mentor, said in
the course of the Fabian Society Lectures that the party was "trying
to transform a profoundly bourgeois society, mainly composed of what
Bagehot called 'deferential' citizens, allergic to theory because
long centuries of success have trained it to distrust of philosophic
speculation, and acquiescent in the empiricist's dogma that somehow
something is bound to turn up, a society, moreover, in which all
the major criteria of social values have been imposed by a long
indoctrination for whose aid all the power of church and school, of
press and cinema, have been very skillfully mobilized; we have got
to transform this bourgeois society into a socialist society, with
foundations not less secure than those it seeks to renovate."
Doubtless these ominous words failed to penetrate into the clubs and
boardrooms that were the sanctums of the former ruling class. But
it was hardly necessary that they should. The businessmen and the
Conservative politicians understood Harold Laski's objectives.
Nationalization of industry is the most widely advertised economic
result of Labor policies between 1945 and 1951. In assessing its effect
on the changes in Britain since 1939, we must remember that neither
was it so new nor is it so extensive as Americans believe. The British
Broadcasting Corporation was created as a public corporation as long
ago as 1927. Today most manufacturing in Britain remains in the control
of private enterprise.
Between 1945 and 1951, however, the Labor government's policy of
nationalization created corporations that today operate or control
industries or services. In two industries, steel and road transport,
the trend toward nationalization has been reversed. But the following
list shows the extent of nationalization in Britain today.
_Coal_: The Coal Industry Nationalization Act received the Royal Assent
in May of 1946, and on January 1, 1947, the assets of the industry were
vested in the National Coal Board appointed by the Minister of Fuel and
Power and responsible for the management of the industry. For a century
coal was king in Britain, and British coal dominated the world market
until 1910. Coal production is around 225,000,000 tons annually--the
peak was reached in 1913 with 287,000,000 tons--and the industry
employs just over 700,000 people.
_Gas_: Under the Gas Act of 1948 the gas industry was brought under
public ownership and control on May 1, 1949. The national body is the
Gas Council, also appointed by the Minister of Fuel and Power. The
council consists of a full-time chairman and deputy chairman and the
twelve chairmen of the area boards.
_Electricity_: The Central Electricity Authority in April 1948 took
over the assets of former municipal and private electricity supply
systems throughout Great Britain with the exception of the area
already served by the North of Scotland Hydro-Electric Board, another
public corporation. But the industry had long been moving toward
nationalization. As early as 1919 the Electricity Commissioners
were established to supervise the industry and promote voluntary
reorganization. The industry is a big one, employing approximately
200,000 people, and production in 1954 was over 72,800,000,000
kilowatts.
_Banking_: The Bank of England, Britain's central bank, was established
in 1694 by Act of Parliament. Its entire capital stock was acquired by
the government under the Bank of England Act of 1946. As the central
bank, the Bank of England is the banker to the government, its agent
in important financial operations, and the central note-issuing
authority.
_Transport_: On January 1, 1948, under the Transport Act passed in
the preceding year, most of Britain's inland transport system came
under public ownership. Nationalization embraced the railways and
the hotels, road-transport interests, docks and steamships owned by
the railways, most of the canals, and London's passenger-transport
system. The public authority then established was the British Transport
Commission. Originally the Commission appointed six executive bodies
to run various parts of the system: the Railway Executive, the Road
Transport Executive, the Road Passenger Executive, the Hotel Executive,
the London Transport Executive, and the Docks and Inland Waterways
Executive. This generous proliferation of authority affected an
industry that employs nearly 2,000,000 workers.
Transport was one of the nationalized industries whose organization
was altered by the Conservatives when they returned to power in 1951.
Believing that "competition gives a better service than monopoly,"
the Tories passed the Transport Act of 1953. This returned highway
freight-haulage to private enterprise and aimed at greater efficiency
on the railroads through the encouragement of competition between the
various regions, such as the Southern Region or the Western Region,
into which the national system had been divided. The act also abolished
all the neat but rather inefficient executives except the Road
Passenger Executive, which had been abolished, unmourned save by a few
civil servants, in 1952, and the London Transport Executive, which was
retained.
_Airways_: British governments since the twenties have been involved
in civil aviation. Imperial Airways received a government grant of
£1,000,000 as early as 1924. By 1939 the Conservative government
had established the British Overseas Airways Corporation by Act of
Parliament. In 1946 the Labor government, under the Civil Aviation Act,
set up two additional public corporations: British European Airways
and British South American Airways. The latter was merged with BOAC in
1949.
_Communications_: The government took control of Cable and Wireless
Ltd., the principal overseas telegraph service, on January 1, 1947.
Thus, the Post Office now operates overseas telecommunications from the
United Kingdom and, of course, all internal telephonic and telegraphic
systems.
These were the most important milestones on the Labor Party's
progress toward nationalization. Viewed dispassionately, they were
evolutionary rather than revolutionary. There had been a trend toward
nationalization in electricity for some years. Objective investigators
had suggested nationalization to aid the failing coal-mining industry,
and during the war (1942) the Coalition government had assumed full
control of the industry's operations although private ownership
retained control of the mines.
We should avoid, too, the impression, popular among the uninformed in
the United States and even in Britain, that nationalization meant that
the workers took over management of the industries concerned. There
was no invasion of boardrooms by working-men in cloth caps. On the
contrary, employees protested that nationalization did not affect the
management of industries, and such protests were backed by facts. In
1951, after six years of Labor Party rule, trade-union representation
among the full-time members of the boards of the nationalized
industries was a little under 20 per cent, and among the part-time
members the percentage was just below 15 per cent. Five boards had no
trade-union representation.
The nationalization program of the Labor government between 1945 and
1951 nevertheless marked an important change in the structure of
British society. The financial and economic control of some of the
nation's most important industries was transferred from private to
public hands. The capitalist system that had served Britain so well
found its horizons limited in important fields.
There is now no important political movement in Britain to undo the
work of the Labor government in the fields mentioned above. But as long
as a generation survives which knew these industries under private
control, harsh and persistent criticism will persist. Some of it is
just. The standard of efficiency and comfort on British railroads, for
instance, has deterioriated since pre-war days. But in many instances
the critics are attacking aspects of the nationalized industries
which are the result not of nationalization itself but of the gradual
wearing out of much of the nation's industrial plant. Two wars, a
long depression, and a prolonged period of economic austerity during
which only the most important improvements and construction could be
financed have had their effect. Both British industry and the transport
system upon which it rests--railroads, ports, highways--need immediate
improvement and new construction.
Nationalization, however, was only one means of altering the bases of
British society. The historian of the future may consider that the
tremendous extension of government responsibility for social welfare
was a more important factor in the evolution of Britain. The Welfare
State has been a target for critics on both sides of the Atlantic.
Its admitted cost, its supposed inefficiency are denounced. British
critics, however, avoid a cardinal point. The Welfare State is in
Britain to stay. No government relying on the electorate for office is
going to dismantle it.
This is not a reference book, but we had better be sure of what we mean
by the British "Welfare State" as we consider its effect on the society
it serves.
The system is much more extensive than most Americans realize.
The government is now responsible through either central or local
authorities for services that include subsistence for the needy,
education and health services for all, housing, employment insurance,
the care of the aged or the handicapped, the feeding of mothers and
infants, sickness, maternity, and industrial-injury benefits, widows'
and retirement pensions, and family allowances.
The modern John Bull can be born, cared for as an infant, educated,
employed, hospitalized and treated, and pensioned at the expense of the
state and ultimately of himself through his contributions. This is the
extreme, and it arouses pious horror among those of conservative mind
in Britain as well as in the United States.
Again, as in the case of the nationalization of industry, we find that
much of the legislation that established the Welfare State did not
spring from the bulging brows of Sir Stafford Cripps, Lord Beveridge,
or Aneurin Bevan, but is the latest step in an evolutionary process.
National Insurance is the logical outgrowth of the Poor Relief Act of
1601, before there were Englishmen in America, and the contributory
principle on which all later measures in this field have been based
first appeared in the National Health Insurance Scheme of 1912.
The present system is big and it is expensive. The national and
local governments are spending about £2,267,000,000 a year (about
$6,347,600,000) on social services for the Welfare State, and the
expenditure by the Exchequer on social services amounts to over a
quarter of the total.
Yet, as this is Britain where established custom dies hard, voluntary
social services supplement the state services. There are literally
hundreds of them, ranging from those providing general social service,
such as the National Council of Social Service, through specialized
organizations, such as Doctor Barnado's Homes for homeless children and
the National Association for Mental Health, to religious groups such as
the Church of England Children's Society and the Society of St. Vincent
de Paul. The existence and vigor of these voluntary organizations
testifies to the wrongness of the assumption that all social work in
Britain today is in the hands of soulless civil servants.
Of all the actions taken to extend social services under the
Labor government, by far the most novel and controversial was the
establishment of the National Health Service, which came into being on
July 5, 1948. The object of the National Health Service Act was "to
promote the establishment in England and Wales [other acts for Scotland
and Northern Ireland came into force simultaneously] of a comprehensive
health service designed to secure improvement in the physical and
mental health of the people of England and Wales and the prevention,
diagnosis and treatment of illness, and for that purpose to provide or
secure the effective provision of services."
Before we consider what the service does, let us think of those it
was designed to help. The British working class up to 1945 suffered
to a considerable degree from lack of proper medical and dental care.
Doctors and dentists were expensive, and in addition there was a
definite psychological resistance to placing oneself in their care.
Health and medicine were not popularized in Britain, as they were
in the United States; among the poor there was still a tendency to
consider discussion of these subjects as ill-mannered.
There has been some change since the war, but not much. Britons of all
classes were surprised, and some of them a little disgusted, by the
clinical descriptions of President Eisenhower's illness in American
newspapers. But the National Health Service has done much to reduce
the old reluctance to visit the doctor or the dentist because of the
expense.
Three subsequent acts in 1949, 1951, and 1952 have modified the scheme
slightly and have provided for charges for some services. But the
National Health Service is otherwise free and available according to
medical need. Its availability is not dependent on contribution to
National Insurance.
What does the service do? The Ministry of Health is directly
responsible for all hospital and specialist services on a national
basis, the mental-health functions of the old Board of Control,
research work on the prevention, diagnosis, or treatment of illness,
the public-health laboratory service, a blood-transfusion service.
These broad general headings cover an enormous organization, the basis
of which is the General Practitioner Services, which covers the medical
attention given to individuals by doctors and dentists of their own
choice from among those enrolled in the service. About 24,000 or nearly
all of the general practitioners in Britain are part of the service. Of
approximately 10,000 dentists in England and Wales, about 9,500 are in
the service.
Again, costs are high. For six years Labor and Conservative
administrations have sought to keep the net total annual cost of the
National Health Service to just over £400,000,000 or $1,120,000,000. To
limit the drain on the Exchequer it was found necessary to charge for
prescription forms, dentures, and spectacles. Like any welfare scheme,
the National Health Service invited malingerers and imaginary invalids
who cost the doctors--and the state--time and money.
I asked a young doctor in the West Country what he thought of the
scheme. "Well, I don't know if it has contributed much to the health
of my bank statement," he said, "but it has contributed to the health
of the folk around here. People are healthier because they don't wait
until they're desperately ill to see a doctor. And the care of children
has improved tremendously. Perhaps this might have come naturally under
the old system. I don't know. But it's here now, and we're a healthier
lot."
The opposition view was put by an elderly doctor in London who opined
that so great was the pressure on the ordinary general practitioner
from "humbugs" that he never got a chance to do a thorough job on the
seriously ill. The hospitals, he added, were crowded with people who
"don't belong there" and who occupied beds needed by the really sick.
This controversy, like those over the nationalization of industry, will
continue. Again there seems little prospect that any government will
modify in any important way the basic provisions of the National Health
Service Act.
In company with the National Insurance, which applies its sickness,
unemployment, maternity, and widows' benefits to everyone over
school-leaving age, and the National Assistance Board, with its
responsibility for the care of those unable to maintain themselves, the
National Health Service has established the Welfare State in Britain.
Another important function has been largely taken out of the hands of
private individuals and delivered to the state.
What effect did the nationalization of industry and the establishment
of the Welfare State have on British society? Obviously, the first
removed from the control of the moneyed and propertied classes certain
powers over the economic functioning of Britain. The second, because
of its cost, made certain that the heavy tax rates introduced during
and just before World War II would continue. These taxes were paid
principally by the middle class, which, at the outset, refused in many
instances to use the National Health Service.
The effect was a leveling one. The dominant class was stripped, on one
hand, of some of its power to control a large section of the national
economy, although, as we have seen, it managed to retain its direction
of the nationalized industries. At the same time this class found that
it must continue to pay year by year a high proportion of its earned
income for the state's care of its less prosperous fellows. The decline
in the influence, prosperity, and prestige of the old middle class was
definitely accelerated by these two bold advances toward socialism.
From the standpoint of the prestige of this class in Britain and,
frankly, of the usefulness of many of its members to the state,
the withdrawal of British rule from India and Burma and the steps
elsewhere toward the liquidation of the Empire were blows as grievous
as the creation of the Welfare State and the nationalization of some
industries.
Americans should realize that to Britons the Empire was not simply
a place to work and get rich. The people who did the Empire's work
usually retired with only their pensions and a conviction (which is not
much help when you need a new overcoat) that they had done their duty.
The propaganda of India and Pakistan and of their well-wishers in the
United States has obscured for Americans the grand dimensions of the
British achievement in India. For a hundred and ninety years, between
Plassy in 1757 and the withdrawal in 1947, British rule brought peace
and justice to peoples hitherto sorely oppressed by irresponsible
tyrants, many of whom were corrupt and decadent. The British stamped
out thuggee and suttee, ended the interminable little wars, introduced
justice, and labored to build the highways, railroads, and canals that
form the skeletons of independent India and Pakistan. All this was
done by a handful of British officials and white troops in the midst of
the subcontinents millions.
Parenthetically, it might be remembered that when the British Indian
army, which served with the British Army in India, existed, and when
the Royal Navy had the strength and facilities to take it where it was
needed, there was peace between Suez and Singapore.
The British are proud rather than defensive about their record in
India. Even the anti-colonialists of the Labor Party note that free
India and Pakistan operate under British political and legal forms.
Most of them, even those who knew the country well, regarded withdrawal
as inevitable after World War II. But it will take more proof than Mr.
Nehru is prepared to offer to convince many Britons with roots in India
that the people are happier, that justice is universal, that corruption
is declining.
This attitude galls the Indians and their friends, who never liked
the British much. But in the great days of empire the British didn't
care about being liked. This is a significant difference between the
American and British approaches to responsibility and leadership in
international affairs. The American visitor abroad worries about
whether he and his country are liked by the French or the Egyptians or
the Indonesians. The Briton, when the Empire's sun was at the zenith,
never gave a damn. What he wanted was respect, which he regarded as
about as much as a representative of a powerful nation could win from
the nationals of a less powerful nation under economic, political, or
military obligation.
"We ran that district with three officials, some Indian civil servants,
the police, and their white officers, and we ran it damned well," an
official recalled. "There were some troops up the line, but we never
needed them. When we made a decision or gave a judgment, we adhered to
it. We made no distinction between Moslem and Hindu. There was justice
and peace. No, of course they weren't free. They weren't ready to
govern themselves. And d'you think they'd have traded those conditions
for freedom and communal rioting?"
I asked the official the population of the district.
"Three, three and a half million," he said.
The loss of India and Burma under the first Socialist administration
and the consequent decline of British power thus constituted a severe
psychological shock to the middle class that had ruled Britain during
the last century of British administration in India. Later we shall see
the difference it made in Britain's international position vis-à-vis
the Soviet Union. Here we are concerned with the effect upon British
society at home.
That society contains thousands of men and women who knew and
served the Empire and who bitterly resent its liquidation. Usually
inarticulate and no match for the bright young men of the _New
Statesmen_, they can be goaded into wrath. Gilbert Harding, a
television entertainer who has become a national celebrity, found this
out. Mr. Harding referred on television to the "chinless idiots" who
made that "evil thing," the British Empire. The reaction was immediate
and bitter. Mr. Harding was abused in the editorial and letter columns
of the newspapers in phrases as ugly as any he had used. There are, it
appeared, many who glory in the Empire and in the Commonwealth that has
evolved from the old colonies.
Nationalization, the creation of the Welfare State, the withdrawal from
India--these were major events that changed the face and manner of
Britain. But the effect of the change in British life was evident, too,
in the way men lived. The austerity preached by Sir Stafford Cripps
may have been necessary if the nation was to overcome the effects of
the war. But continued rationing, the queues outside the shops, the
shortages of coal, the persistently high taxation all combined to
change the life of the middle class. Slowly they realized that the
sacrifices and dangers of the war years were not going to be repaid.
There was no brave new world. Instead, there was the old world looking
much more shabby than ever before.
"You see," people would say, explaining some new restriction, some new
retreat before economic pressure, "we won the war." It was a bitter
jest in the long, drab period between 1945 and 1950.
There was plenty of grumbling, some of it bitterly humorous. Lord
Wavell, surveying a glittering audience at a royal command performance
at Covent Garden Opera House, was told by a friend that the scene
reminded him of pre-war days. "The only difference," the great soldier
replied, "is that tomorrow we'll be doing our own washing up."