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HAWTREY, AUSTERITY, AND THE “TREASURY VIEW,” 1918 TO 1925

Published online by Cambridge University Press:  18 December 2018

Clara Elisabetta Mattei
Clara Elisabetta Mattei*
Affiliation:
New School for Social Research, New York.
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Abstract

Ralph G. Hawtrey was not a man of the backwaters. Through the parallel study of Treasury files and Hawtrey’s scholarly publications, this work reveals his direct influence upon the most commanding minds of the Treasury and the Bank of England, the two institutions that, after WWI, shared primary responsibility over the British austerity agenda. After the war, Hawtrey advocated drastic budgetary and monetary rigor in the name of price stabilization. From 1922, Hawtrey admitted the need to decrease the bank rate; yet he remained an adamant supporter of the gold standard, insisting on its maintenance even if it required further monetary revaluation. Hawtrey’s policy prescriptions stemmed directly from his economic model. The “crowding-out argument,” the centrality of credit and of savings, together with the operational priority of technocratic institutions, were essential theoretical underpinnings of Hawtrey’s agenda: implementing the so-called Treasury view.

Type
Articles
Information
Journal of the History of Economic Thought , Volume 40 , Issue 4 , December 2018 , pp. 471 - 492
Copyright
Copyright © The History of Economics Society 2018 

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Footnotes

I would like to thank Pierluigi Ciocca, Giovanni Dosi, Claude Diebolt, Duncan Foley, Alessandro Nuvolari, Anwar Shaikh, and Adam Tooze for all their valuable ideas in developing and improving this project. A special thanks to George Peden and Nicola Giocoli for their fundamental support and advice throughout the research and writing process. All shortcomings are my own.

References

REFERENCES

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Hawtrey, Ralph George. 1919. Currency and Credit. London: Longmans, Green.Google Scholar
Hawtrey, Ralph George. 1922. “The Genoa Resolutions on Currency.” The Economic Journal 32 (127): 290–304.CrossRefGoogle Scholar
Hawtrey, Ralph George. 1925. “Public Expenditure and the Demand for Labour.” Economica 5 (13): 38–48.CrossRefGoogle Scholar
Hawtrey, Ralph George. 1931. Trade Depression and the Way Out. London: Longmans, Green.Google Scholar
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Middleton, Roger. 1985. Towards the Managed Economy: Keynes, the Treasury, and the Fiscal Policy Debate of the 1930s. New York: Methuen.Google Scholar
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Peden, George C. 1985. British Economic and Social Policy: Lloyd George to Margaret Thatcher. Oxford: Philip Alan.Google Scholar
Peden, George C. 1993. “The Road to and from Gairloch: Lloyd George, Unemployment, Inflation, and the ‘Treasury View’ in 1921.” Twentieth Century British History 4 (3): 224–249.CrossRefGoogle Scholar
Peden, George C. 1996. “The Treasury View in the Interwar Period: An Example of Political Economy?” In Corry, Bernard, ed., Unemployment and the Economists. Cheltenham: Edward Elgar, ch. 4.Google Scholar
Peden, George C. 2000. The Treasury and British Public Policy, 1906–1959. Oxford: Oxford University Press.CrossRefGoogle Scholar
Peden, George C. 2004. Keynes and His Critics: Treasury Responses to the Keynesian Revolution 1925–1946. Oxford: Oxford University Press.Google Scholar
Sayers, Richard S. 1976. The Bank of England 1891–1944. Cambridge: Cambridge University Press.Google Scholar
Skidelsky, Robert. 1981. “Keynes and the Treasury View: The Case For and Against an Active Unemployment Policy, 1920–1929.” In Mommsen, Wolfgang J. and Mock, Wolfgang, eds.,The Emergence of the Welfare State in Britain and Germany, 1850–1950. Beckenham: Croom Helm, pp. 167–187.Google Scholar
Tooze, Adam. 2014. The Deluge: The Great War, America and the Remaking of the Global Order, 1916–1931. New York: Penguin.Google Scholar
Young Allyn, A. 1920. “Review of Currency and Credit.” The Quarterly Journal of Economics 34 (3): 520–532.Google Scholar
Young Allyn, A. 1924. “Review of Currency and Credit.” The American Economic Review 14 (2): 349–351.Google Scholar
The National Archives of the United Kingdom, LondonGoogle Scholar
Chancellor of the Exchequer’s Office: Miscellaneous Papers (T 172)Google Scholar
Sir Otto Niemeyer papers (T 176)Google Scholar
Treasury Financial Enquiries Branch files (T 208)Google Scholar
Churchill College, CambridgeGoogle Scholar
Sir Ralph Hawtrey papers (HTRY)Google Scholar
Committee on National Expenditure. 1922. First Interim Report, Cmd. 1581; Second Interim Report, Cmd. 1582; Third Interim Report, Cmd. 1589.Google Scholar
International Economic and Financial Conference . 1922. Resolutions of the Financial Commission Recommending Certain Resolutions for Adoption by the Conference; Reports of the Committee of Experts Appointed by the Currency and Exchange Sub-Commissions of the Financial Commission, Cmd. 1650.Google Scholar
Memoranda on Certain Proposals Relating to Unemployment, Cmd. 3331. 1929.Google Scholar
The Times, The Times Digital Archive 1785-2010Google Scholar
Black, Robert Denis Collison. 1977. “George Hawtrey 1879–1975.” In Proceedings of the British Academy. Volume 63. Oxford: Oxford University Press, pp. 363–398.Google Scholar
Blyth, Mark. 2013. Austerity: The History of a Dangerous Idea. Oxford: Oxford University Press.Google Scholar
Bowley, Marian. 1945. Housing and the State. London: G. Allen & Unwin Ltd.Google Scholar
Clarke, Peter. 1988. The Keynesian Revolution in the Making. Oxford: Clarendon Press.Google Scholar
Daunton, Martin. 2002. Just Taxes . Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Deutscher, Patrick. 1990. Hawtrey and the Development of Macroeconomics. London: Macmillan.CrossRefGoogle Scholar
Friedman, Milton, and Schwartz, Anna Jacobson. 1963. A Monetary History of the United Sates 1867–1960. Princeton: Princeton University Press.Google Scholar
Gaukroger, Alan. 2008. “The Director of Financial Enquiries: A Study of the Treasury Career of R. G. Hawtrey (1919–1939).” Doctoral thesis, University of Huddersfield.Google Scholar
Hawtrey, Ralph George. 1913. Good and Bad Trade: An Enquiry into the Causes of Trade Fluctuations. London: Constable.Google Scholar
Hawtrey, Ralph George. 1919. Currency and Credit. London: Longmans, Green.Google Scholar
Hawtrey, Ralph George. 1922. “The Genoa Resolutions on Currency.” The Economic Journal 32 (127): 290–304.CrossRefGoogle Scholar
Hawtrey, Ralph George. 1925. “Public Expenditure and the Demand for Labour.” Economica 5 (13): 38–48.CrossRefGoogle Scholar
Hawtrey, Ralph George. 1931. Trade Depression and the Way Out. London: Longmans, Green.Google Scholar
Hawtrey, Ralph George. 1937. “The Credit Deadlock.” In Gayer, Arthur D., ed., The Lessons of Monetary Experience: Essays in Honor of Irving Fisher, Presented to him on Occasion of his Seventieth Birthday. New York: Farrar & Rinehart, Inc. pp. 129–144.Google Scholar
Hawtrey, Ralph George. 1944. Economic Destiny. London: Longmans, Green.Google Scholar
Howson, Susan. 1974. “The Origins of Dear Money 1919–1920.” Economic History Review, 2nd Series, 26 (1): 88–107.CrossRefGoogle Scholar
Howson, Susan. 1985. “Hawtrey and the Real World.” In Harcourt, G. C., ed., Keynes and his Contemporaries . London: Macmillan, pp. 142–188.CrossRefGoogle Scholar
Howson, Susan, and Winch, Donald. 1977. The Economic Advisory Council, 1930–1939: A Study of Economic Advice during Depression and Recovery. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Laidler, David. 1993. “Hawtrey and the Origins of the Chicago Tradition.” Journal of Political Economy 10 (6): 1068–1103.CrossRefGoogle Scholar
Levy, David M., and Peart, Sandra J.. 2017. Escape from Democracy: The Role of Experts and the Public in Economic Policy. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Leonard, Thomas C. 2016. Illiberal Reformers: Race, Eugenics, and American Economics in the Progressive Era. Princeton: Princeton University Press.Google Scholar
Mallet, Bernard, and Oswald George, C.. 1933. British Budgets, 1921/1922–1932/33. London: Macmillan.Google Scholar
Malpass, Peter. 2005. Housing and the Welfare State: The Development of Housing Policy in Britain. New York: Palgrave.Google Scholar
Mattei, Clara Elisabetta. 2016. “The Conceptual Roots of Contemporary Austerity Doctrine: A New Perspective on the British Treasury View .” New School Economic Review 8: 115–146.Google Scholar
Mattei, Clara Elisabetta. 2017. “The Guardians of Capitalism. International Consensus and Technocratic Implementation of Austerity.” Law and Society 44 (1): 10–31.CrossRefGoogle Scholar
Mattei, Clara Elisabetta. 2018. “Treasury View and Post-WWI British Austerity: Basil Blackett, Otto Niemeyer and Ralph Hawtrey.” Cambridge Journal of Economics 42 (4): 1123–1144. https://doi.org/10.1093/cje/bex061.CrossRefGoogle Scholar
McDonald, Andrew. 1989. “The Geddes Committee and the Formulation of Public Expenditure Policy, 1921–1922.” The Historical Journal 32 (3): 643–674.CrossRefGoogle Scholar
McKibbin, Ross. 1974. The Evolution of the Labour Party. Oxford: Oxford University Press.Google Scholar
Moggridge, Donald. 1972. British Monetary Policy, 1924–1931: The Norman Conquest of $4.86. Cambridge: Cambridge University Press.Google Scholar
Moggridge, Donald, and Howson, Susan. 1974. “Keynes on Monetary Policy, 1910–1946.” Oxford Economic Papers 26 (2): 226–247.CrossRefGoogle Scholar
Middleton, Roger. 1985. Towards the Managed Economy: Keynes, the Treasury, and the Fiscal Policy Debate of the 1930s. New York: Methuen.Google Scholar
Peden, George C. 1983. “The Treasury as the Central Department of Government, 1919–1939.” Public Administration 61 (4): 235–250.Google Scholar
Peden, George C. 1985. British Economic and Social Policy: Lloyd George to Margaret Thatcher. Oxford: Philip Alan.Google Scholar
Peden, George C. 1993. “The Road to and from Gairloch: Lloyd George, Unemployment, Inflation, and the ‘Treasury View’ in 1921.” Twentieth Century British History 4 (3): 224–249.CrossRefGoogle Scholar
Peden, George C. 1996. “The Treasury View in the Interwar Period: An Example of Political Economy?” In Corry, Bernard, ed., Unemployment and the Economists. Cheltenham: Edward Elgar, ch. 4.Google Scholar
Peden, George C. 2000. The Treasury and British Public Policy, 1906–1959. Oxford: Oxford University Press.CrossRefGoogle Scholar
Peden, George C. 2004. Keynes and His Critics: Treasury Responses to the Keynesian Revolution 1925–1946. Oxford: Oxford University Press.Google Scholar
Sayers, Richard S. 1976. The Bank of England 1891–1944. Cambridge: Cambridge University Press.Google Scholar
Skidelsky, Robert. 1981. “Keynes and the Treasury View: The Case For and Against an Active Unemployment Policy, 1920–1929.” In Mommsen, Wolfgang J. and Mock, Wolfgang, eds.,The Emergence of the Welfare State in Britain and Germany, 1850–1950. Beckenham: Croom Helm, pp. 167–187.Google Scholar
Tooze, Adam. 2014. The Deluge: The Great War, America and the Remaking of the Global Order, 1916–1931. New York: Penguin.Google Scholar
Young Allyn, A. 1920. “Review of Currency and Credit.” The Quarterly Journal of Economics 34 (3): 520–532.Google Scholar
Young Allyn, A. 1924. “Review of Currency and Credit.” The American Economic Review 14 (2): 349–351.Google Scholar