by Andrew White | December 30, 2017 | Comments Off on Book Review: ‘Goodbye, Great Britain’ – The 1976 IMF Crisis
‘Goodbye, Great Britain’ – The 1976 IMF Crisis, Kathleen Burk and Alec Cairncross, Yale University Press, 1992.
After reading Douglas Wass’s 2008 ‘Decline to Fall – The Making of British Macro-Economic Policy and the 1976 IMF Crisis’, I was a little worried I would not learn much new about this critical point in British economic history. Wass was an active participant in the British government at the time so his newer book held out the promise of insider views. The older book however did not let me down.
Burk and Cairncross do not really add too much new to the story concerning the run up to the bail out. The analysis is more rigorous, which is what you would expect especially after reading many books by Cairncross. But where ‘Goodbye’ excels is the analysts of the economic and political views that came to a head around the period of the crisis and just after.
Keynesian economics, or a bastardized variant of same called demand management, was past its apex in terms of popularity and Britain had shorn it any proof to its effectiveness. Monetarism, already active in the US, was gaining popularity in Britain. The crisis drew out the views, the arguments, and other variants in policies and ideas, spanning incomes policy, exchange and capital controls, and trade restrictions. Britain was at a crossroads and it turned out to be the first to practice monetarist polices as a result.
‘Goodbye’ is a great read, well written, choc full of data and easily understood material for the layman. If you want to understand the challenges Britain faces with a Brexit future and how trade may very well dictate domestic policy, you can do little better then by reading ‘Goodbye’ and then ‘Decline to Fall’. And in the process you will also learn about the changing role of a declining reserve currency, something the US needs to be wary of in the coming years.
Recommend 9 out of 10.
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