commercial banks or the insurance companies.
The coal mines, civil aviation, the railways, and gas
and electricity production were also brought
under state control by the close of 1947, with the
employers and shareholders receiving compensa-
tion. But although now ‘owned by the people’,
the workers did not play a new and significant role
in running state industries. The government
appointed a management team, who were fre-
quently none other than the former managers,
and the workers at best exchanged one set of
employers for another. Consequently nationalisa-
tion had little impact on good industrial relations.
More important in this respect was the Trade
Disputes and Trade Union Act 1946, which
repealed the restrictions placed on trade union
power after the General Strike of 1926. A gener-
ation later new efforts would be made by both
Labour and Conservative governments to restrict
trade unions once again in the actions they could
take without incurring legal penalties. By then,
the majority of the electorate had come to feel
that the balance of power had swung too far in
favour of the trade unions and against the
national interest.
The ability to feed Britain during the immedi-
ate post-war years, to pay for raw material and to
revive industry was dependent not only on fol-
lowing sound policies, which Labour did, nor on
the mobilisation of Britain’s depleted capital
resources, but also on American help. By them-
selves, the British could not earn enough dollars
to pay for the imports necessary for Britain and
the German zone of occupation. There were no
illusions about the country’s plight in this respect.
The problem appeared to be a transitional one.
The Roosevelt administration had made it
clear that it was prepared to help in post-war
reconstruction and that it would not return to
isolationism. It was obvious that the US would
emerge from the war as the world’s economic
superpower unscarred and unscathed by the
ravages of fighting at home. In this task of recon-
struction, Britain was America’s principal partner,
and Anglo-American economic plans for the post-
war world had been prepared in continuous
rounds of discussion since 1942. They took con-
crete form at a conference held under the aegis
of the United Nations in a Washington suburb at
Bretton Woods.
In their planning of the world economic future
the British and American administrations knew
they were dealing with crucial problems that went
far beyond technical details. If the mistakes after
the First World War, which led to international
economic warfare, mass unemployment and the
great depression, were not simply to be repeated,
a sensible method of achieving economic cooper-
ation and mutual support would need to be
worked out. The US would, for a time at least,
have to provide massive assistance. On this the
Americans and the British were agreed. It corres-
ponded to American custom that the form of this
cooperation should be institutionalised. At
Bretton Woods the foundations were soundly
laid, even though solutions were not found for
every international economic problem likely to
arise in the post-war world.
The details of the Bretton Woods agreements
are complex, but the essential points can be sim-
plified and understood without expertise in high
finance. The key was US concern about discrim-
ination in worldwide trade. Individual countries
in the 1930s had rigidly attempted to control
their foreign imports. One important mechanism
that national governments could most effectively
use to this end was exchange control: the impo-
sition of restrictions on the exchange of their own
currency for those of other countries. Sterling was
a currency used in world transactions; if its
exchange into dollars were restricted, then
Britain, the Commonwealth (except Canada) and
many other countries trading in sterling would
not be able to buy from the US, and worldwide
there would be a barrier to trade. An important
part of the Bretton Woods agreements was an
undertaking to make all currencies freely convert-
ible after a transitional period of five years;
exchange rates between currencies, including the
dollar, would be fixed and regulated by a new
international institution, the International
Monetary Fund (IMF). It was intended that
exchange rates should be stable and that they
should be changed only with the consent of the
IMF. The resources of the Fund were to be made
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BRITAIN AND THE WORLD 331
