In what became the heart-stopping conclusion to a contentious, on-again/off-again battle on Capitol Hill over the matter of approving the proposal of a loan to Britain, one of many given to Britain since the dark days of World War 2 and Lend-Lease, many in the house felt it was time to put an end to the bailouts and let Britain manage to get on its feet on its own.
Some of those who had followed the Congressional debate on the Anglo-American loan agreement may have formed the impression that granting this loan was a magnanimous act on the part of the United States from which Britain, and Britain alone, would profit. In reality, the loan would prove equally beneficial to both participants. Far more important, it had a world significance in that it would provide the means of raising the living standards of all territories, from North America to Africa, from China to India and Burma, said an economic correspondent for the United Kingdom Information Office. The widespread assumption in the United States that the loan to Britain must be a one-sided bargain was due to the fact that the advantages accruing to the latter country, being more immediate, were therefore’ more obvious. One of these obvious advantages would be the relaxation, if only to a limited degree, of the rigid austerity maintained by Britain during and since the war–an austerity which was in 1946 stricter even than in the war itself.
Such relaxation as increased imports of foodstuffs to bring some variety to the monotonous British diet will, however, encroach on only a small part of the American credit. Before dealing with the uses to which Britain will put the bulk of these $3,750,000,000, it was worthwhile reviewing the conditions which called forth the British request for the American loan.’
The American loan would not solve Britain’s export problem–but it would help to speed the development of her export trade and eventually also the expansion of her imports; the first great benefit which the world will derive from the Anglo-American loan agreement. An expanding British import trade is requisite for world prosperity, for before the war Britain was the greatest single buyer among all the nations. No less than 31 different countries sold more to the United Kingdom than they did to any other territory. The granting of the United d States credit would not mean an immediate resumption of Britain’s former large-scale purchases throughout the world.
A large part of it will in fact be spent in the United States, and here can be seen an important advantage which that country in particular would gain from the agreement. But the main significance is that it would be available for expenditure all over the world and would aid the general expansion of trade.
Here, from a view from the other side of the Atlantic, by way of the BBC World Service, a talk by MacDonald Hastings over the proposal of the Anglo-American Loan and its implications given on July 19, 1946.
