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THREAD: UK on brink of Parliamentary vote which will seal our economic fate for decades to come. Sovereignty at stake. Both govt & opposition desperately split. And the threat of an economic crunch if the Commons doesn't play ball. Unprecedented, right? Wrong... 1/
Actually there is at least one historical analogy. A do-or-die moment with MPs struggling to choose between diluting their economic sovereignty and a "financial Dunkirk". So here is the story of what happened in Dec 1945. Let's see if there are any lessons for today... 2/
Towards end of WW2 Allied powers realised they'd have to rebuild the international monetary system that fell apart in the 1930s (contributing to the depression). They came up with the Bretton Woods system: everyone would peg their currencies to the US$ and it in turn to gold 3/
This historic agreement locked the UK (& other countries) into a kind of economic union for decades. Britain (most notably JM Keynes) was one of the key designers of the system and its institutions, the IMF and World Bank. But it wasn't without controversy back home... 4/
There were some MPs in both Conservative and Labour party (particularly the Tories) who resented the infringement on UK sovereignty. They would rather the UK crashed out and reinforced economic links with the Empire. This, by the way, was not simply an academic matter... 5/
The UK was effectively bankrupt. The war had taken its toll & adding to the pain in 1945 the US cut off lend-lease, its wartime financial bailout. Some Tory MPs rubbed their hands in glee. Sovereignty! The Chancellor sent Keynes off to Washington to negotiate a new loan 6/
Keynes boasted that he was so good at negotiating the US would prob gift the UK billions. But the Americans played hardball. UK ended up with a $3.75bn loan at 2% interest rates for decades. Plus a poisonous condition: it wld have to sign up to Bretton Woods earlier than exp 7/
Footnote: Keynes was v unwell at this stage & his quack doctor prescribed him something called sodium amytal for heart disease. Turns out the drug is also a truth serum. At the v moment he most needed his poker face, Keynes was high on a drug that compels you tell the truth 8/
Anyway, the Attlee govt were desperate to try to rush this deal (loan plus Bretton Woods) through Parliament as quickly as possible, warning the UK would face bankruptcy if not. MP were horrified. Forced to make most important econ decisions in generations at barrel of a gun! 9/
The Tories (in opposition following Churchill's defeat in the 1945 election) were totally split. A splinter group, not unlike today's ERG, refused to sign up to anything diminishing the UK's sovereignty. 10/
"This is our economic Munich" declared Bob Boothby in the Commons. "There is one mandate which HM Govt never got from the people and that was to sell the British Empire for a packet of cigarettes", whereupon he threw a pack of fags onto the floor of the House, causing uproar 11/
Boothby was an interesting fellow. Not unlike certain Brexiteers now he was a charismatic Tory who refused to toe the party line & was frequently on radio & papers railing against the deal. Oh & he was having an affair with Harold Macmillan's wife (as hinted at in The Crown) 12/
The Commons debates over the loan and Bretton Woods were fraught and dramatic. There were protests outside Parliament. MPs were derided for advocating a dilution of Britain's sovereignty. There were plenty of similarities with today's Brexit saga. So how did it all end...? 13/
The deal eventually passed 345-98. How? Rather than opposing it, opposition whips urged their members to abstain instead. Was seen as a big humiliation for Churchill. Even so, 29 MPs from govt benches voted against. And that's how Bretton Woods & the post-war loan became law 14/
Might the same thing happen this time? Might the PM get her Brexit deal through the House thanks to opposition abstentions? Gotta say it looks unlikely right now. Corbyn a v different politician to Churchill, who said of the Attlee govt "We must do all we can to help them" 15/
Plus: unlike Attlee this govt has no majority. It's even more split. There's scant genuine cross-party dialogue. & the equation's even more complex because Parliament isn't the only protagonist: there's the other 27 EU states too. So the signs are not especially encouraging. 16/
Now I promise the above wasn't intended as an ad for my book abt Bretton Woods. But some of it does indeed come from The Summit which you can find here: amazon.co.uk/Summit-Biggest…. Also check out this excellent @RichardToye paper on the Commons vote: ore.exeter.ac.uk/repository/bit… ENDS
