04-22-2009, 08:02 AM
<b>Oil and the origins of the âWar to make the world safe for Democracyâ </b>
By F. William Engdahl, 22 June, 2007
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<b>British Empireâs onset of economic decline</b>
<b>Behind her apparent status as the world's pre-eminent power, Britain was slowly deteriorating internally. </b>After <b>1850 </b>a sharp rise in <b>British capital flowing overseas </b>took place. After the US Civil War and with the emerging of German and Continental European as well as Latin American industrialization in the early 1870âs, this <b>flow of capital out of the City of London became massive. </b>Britainâs wealthy found returns on their money far greater abroad than at home. It was one consequence of the 1846 Corn Law Repeal, the introduction of free trade in agriculture to force cheaper wages and to feed that labor with cheaper foodstuffs imported from Odessa, the United States, India and other foreign suppliers.[9] Buy Cheap, Sell Dear had become the dominant economic pattern.[10]
After 1846, wage levels inside Britain began falling with the price of bread. The English Poor Laws granted compensation for workers earning below human subsistence wage, with income supplement payments pegged to the price of a loaf of wheat bread. As bread prices plunged, so did living standards in England.
<b>As a consequence, while the merchant banks and insurers of the City of London thrived, domestic British industrial investment and modernization, </b>which had allowed England to lead the industrial revolution after the introduction of Wattâs improved steam-powered engine in the 1760âs, <b>stagnated and declined after 1870.</b>
One consequence was the shift in economic weight from the industrial north of EnglandâManchester, Birmingham, Leeds, Newcastle, Liverpool-- south to London and the financial and trade services tied to the growing role of the City in international finance. From trade in âvisiblesâ like coal, machines and steel products, <b>Britain shifted to a nation earning from what were termed âinvisibles,â or financial return on overseas investment and services.</b>
Britain increased its dependence on imported goods following the introduction of free trade. From 1883 to 1913 the Sterling value of her imports rose by 84%. The real efect of the shift to import dependence was obscured by the phenomenal success of earnings from invisibles. In <b>1860 </b>Britain led the world in coal production, the raw material feeding her industry and fuelling her navy, with almost 60% of the total.By <b>1912 </b>that fell to 24%. Similarly, in <b>1870 </b>England enjoyed an impressive 49% share of total world iron forging output. By <b>1912 </b>it was 12%. Copper consumption, an essential component of the emerging electrification transformation, went from 32% of world consumption in 1889 to 13% by 1913.[11]
<b>The final quarter century of the 1800âs was the beginning of the end of the hegemonic position of Britain as the worldâs dominant economic power.</b>
<b>
In 1873 a severe economic depression, dubbed in English history the Great Depression, spread, persisting until 1896, almost a quarter Century, </b>a decisive period in the development of the forces leading to the Great War in 1914. The 1873 depression led to the further decline of British industrial competitiveness. Price levels went into steady fall or deflation, profit margins and wages with it. Huge sums of capital remained idle or went abroad in search of gain.
While the crisis in England was severe, the effects outside Britain were short-lived. By the mid-1890âs the German Reich was in the midst of an economic boom unlike any before. The rival German and other Continental economies were rapidly industrializing and exporting to markets once dominated by British exports. [12]
<b>By the 1880âs Britainâs leading circles and advocates of Empire </b>realized that they needed to not only send their entrepreneurs like Cecil Rhodes to mine the gold to feed the banks of the City of London. Increasingly, they realized a revolution in the technology of naval power was required if the Royal Navy was to continue its unchallenged hegemony of the seas. That required a radical shift in British foreign policy. The revolution in technology was the shift from coal to oil power.
After the 1890âs, though little publicized, the search for secure energy in the form of petroleum would become of paramount importance to Her Majestyâs Navy and Her Majestyâs government. A global war for control of oil was shaping up, one few were even aware of outside select policy circles.
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By F. William Engdahl, 22 June, 2007
<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->..
<b>British Empireâs onset of economic decline</b>
<b>Behind her apparent status as the world's pre-eminent power, Britain was slowly deteriorating internally. </b>After <b>1850 </b>a sharp rise in <b>British capital flowing overseas </b>took place. After the US Civil War and with the emerging of German and Continental European as well as Latin American industrialization in the early 1870âs, this <b>flow of capital out of the City of London became massive. </b>Britainâs wealthy found returns on their money far greater abroad than at home. It was one consequence of the 1846 Corn Law Repeal, the introduction of free trade in agriculture to force cheaper wages and to feed that labor with cheaper foodstuffs imported from Odessa, the United States, India and other foreign suppliers.[9] Buy Cheap, Sell Dear had become the dominant economic pattern.[10]
After 1846, wage levels inside Britain began falling with the price of bread. The English Poor Laws granted compensation for workers earning below human subsistence wage, with income supplement payments pegged to the price of a loaf of wheat bread. As bread prices plunged, so did living standards in England.
<b>As a consequence, while the merchant banks and insurers of the City of London thrived, domestic British industrial investment and modernization, </b>which had allowed England to lead the industrial revolution after the introduction of Wattâs improved steam-powered engine in the 1760âs, <b>stagnated and declined after 1870.</b>
One consequence was the shift in economic weight from the industrial north of EnglandâManchester, Birmingham, Leeds, Newcastle, Liverpool-- south to London and the financial and trade services tied to the growing role of the City in international finance. From trade in âvisiblesâ like coal, machines and steel products, <b>Britain shifted to a nation earning from what were termed âinvisibles,â or financial return on overseas investment and services.</b>
Britain increased its dependence on imported goods following the introduction of free trade. From 1883 to 1913 the Sterling value of her imports rose by 84%. The real efect of the shift to import dependence was obscured by the phenomenal success of earnings from invisibles. In <b>1860 </b>Britain led the world in coal production, the raw material feeding her industry and fuelling her navy, with almost 60% of the total.By <b>1912 </b>that fell to 24%. Similarly, in <b>1870 </b>England enjoyed an impressive 49% share of total world iron forging output. By <b>1912 </b>it was 12%. Copper consumption, an essential component of the emerging electrification transformation, went from 32% of world consumption in 1889 to 13% by 1913.[11]
<b>The final quarter century of the 1800âs was the beginning of the end of the hegemonic position of Britain as the worldâs dominant economic power.</b>
<b>
In 1873 a severe economic depression, dubbed in English history the Great Depression, spread, persisting until 1896, almost a quarter Century, </b>a decisive period in the development of the forces leading to the Great War in 1914. The 1873 depression led to the further decline of British industrial competitiveness. Price levels went into steady fall or deflation, profit margins and wages with it. Huge sums of capital remained idle or went abroad in search of gain.
While the crisis in England was severe, the effects outside Britain were short-lived. By the mid-1890âs the German Reich was in the midst of an economic boom unlike any before. The rival German and other Continental economies were rapidly industrializing and exporting to markets once dominated by British exports. [12]
<b>By the 1880âs Britainâs leading circles and advocates of Empire </b>realized that they needed to not only send their entrepreneurs like Cecil Rhodes to mine the gold to feed the banks of the City of London. Increasingly, they realized a revolution in the technology of naval power was required if the Royal Navy was to continue its unchallenged hegemony of the seas. That required a radical shift in British foreign policy. The revolution in technology was the shift from coal to oil power.
After the 1890âs, though little publicized, the search for secure energy in the form of petroleum would become of paramount importance to Her Majestyâs Navy and Her Majestyâs government. A global war for control of oil was shaping up, one few were even aware of outside select policy circles.
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