Patriotism and Protectionism Grips the U.K.

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"A patriotic Briton nowadays buys nothing from foreigners if he can help it," reported the New York Times in late April 1932.

Upper-class ladies shopping for alligator purses had to be assured that even if the reptile skin was imported, all the workmanship was domestic.

"Even the working-class wife who must keep house on, say, $10 a week, insists that the pots and pans she buys at the 10-cent store be thoroughly British."

These efforts were part of the Buy British campaign, which encouraged Britons to purchase domestic goods to show their patriotism and support the economy -- and they were bolstered by an unusual bout of British protectionism that heralded wide-ranging social and economic changes to come.

Well before the wave of currency controls and defections from the gold standard that began in the fall of 1931, most nations tried to promote local industry and reduce international outflows of funds by increasing duties on imported goods.

But Britain was not among them; free trade was gospel.

As a result, the U.K. had become what some called a "dumping ground" for goods that, if shipped elsewhere -- to the U.S., for example -- would have been slapped with tariffs of 40 percent to 50 percent.

In consequence, many imports were cheaper in Britain than almost anywhere else, but buying them sent sterling overseas. This worsened the U.K. balance of trade, as goods made by British producers confronted tariffs at every destination.

Late in 1931, the newly elected Conservative Parliament responded by giving authorities the power to impose higher duties on selected goods. In February 1932, Parliament enacted a 10 percent across-the-board tariff on imports, which was due to take effect March 1.

The new policy triggered a rush by exporters to "land" cargoes at U.K. ports before the tax went into effect. On Feb. 29, 1932, 127 fully laden ships entered London; a storm prevented about 50 more from making it to the dock in time.   

Within a month, Britain had paid U.S. banks $150 million of the $200 million debt that was due in August, and unemployment had dropped by 146,000 as a result of revived manufacturing demand, the New York Times reported.

The tariff, not high by global standards, had also encouraged 70 British companies to manufacture goods that had previously been imported, the New York Times reported.

The Buy British campaign was a logical extension of the renewed nationalism these shifts encouraged. But given that, for more than 80 years, the U.K. had anchored both the theory and practice of free trade, this burst of patriotic protectionism caught many by surprise.

As the New York Times explained, "This sense of being engaged in a great financial and economic battle -- as momentous as the war, if not quite so bitter -- has permeated the British consciousness and created a national solidarity so impressive that it surprised and 'embarrassed' (as he put it) even the Prime Minister."

Yet worries persisted about the new solidarity.

"National unity is an admirable thing," the Times wrote. "But it is invariably achieved at the expense of tolerance."

Wise words -- which would become increasingly relevant as the Depression continued.

(Philip Scranton is a Board of Governors professor of the history of industry and technology at the University of Rutgers at Camden and the editor-in-chief of Enterprise and Society. He writes "This Week in the Great Depression" for the Echoes blog. The opinions expressed are his own.)

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