Civilization: The West and the Rest by Niall Ferguson (2011)

The problem of why civilisations fall is too important to be left to the purveyors of scissors-and-paste history. It is truly a practical problem of our time, and this book is intended to be a woodsman’s guide to it. (Preface p.xxii)

Ferguson doesn’t shy away from the big subjects, in fact he enjoys storming the big subjects – the Origins of the Great War, why the British Empire was a Good Thing, the Future of America, a Complete History of Money, a Complete History of the 20th Century. It is no coincidence that the last four of these books were written to accompany four blockbusting TV series, TV being a medium which favours striking stories and bold statements, contrarian points of view and press release-friendly controversy.

This is Ferguson’s fifth book-of-the-TV-series, created after the crash of 2008 revealed the weakness at the heart of the western financial system and events in Iraq showed the limitations of US military power, while, on the other hand, China continued its inexorable economic rise, flanked by the fast-growing economies of Brazil, Russia etc (all as of 2011). In light of these setbacks, Ferguson asks, ‘Has the West had it?’ (rather tritely echoing scores, probably hundreds, of intellectuals who’ve asked the same question for at least a century, the heavyweight champion of millennial pessimism being Oswald Spengler, author of the famous Decline of the West, 1922).

So, if the era of western dominance over the world is coming to an end, what did it consist of in the first place? What gave the West its edge?

What caused the rise of the West?

The problem with tackling the Big Subjects is that a lot of people have been there before you. In his introduction Ferguson himself refers to an impressive number of ‘reasons’ given by his numerous predecessors on this subject:

  1. Europe was made of small fiercely competitive nations fertile in innovations, unlike the large stagnant empires of the Ottomans or the Chinese.
  2. Eurasia is a long east-west land mass of similar climate in which agricultural innovation, animal rearing and agricultural techniques could spread and develop, unlike the geographically more extreme and divided Americas, Africa, Asia or Australasia.
  3. The five most useful, domesticatable animals (the cow, horse, sheep, goat, and pig) are all descendants of species endemic to Eurasia, no comparable animals being available in the other continents, for either food or labour, with the possible exception of the llama.
  4. Double entry book keeping.
  5. Capitalism, a good thing, a dynamic system for creating innovation.
  6. Capitalism, a bad thing, based on the exploitation of the European working class.
  7. Imperialism, a dreadful thing, based on the exploitation of colonial peoples.
  8. Slavery, the worst thing of all – the European slave trade which carried 15 million Africans across the Atlantic generated the profits which fuelled the Agricultural and Industrial Revolutions.
  9. Democracy.
  10. Western property law, especially English Common Law which made the creation of corporations and the protection of creditors easier than continental law codes.
  11. Western banking and finance systems, the banks and bonds described at such length in The Ascent of Money.
  12. The Agricultural Revolution.
  13. The Industrial Revolution.
  14. The Scientific Revolution.
  15. The Military Revolution.
  16. Prolonged exposure to infectious diseases eg smallpox, created immunity in Europeans but decimated non-European populations wherever we took it with us (malaria being the glaring exception, which itself blocked European colonisation of Africa for a long time).
  17. The higher protein content of Eurasian plant species compared with Indian, African or Asian food crops.
  18. The racial or genetic superiority of whites.
  19. The nation state.
  20. Christianity.
  21. Catholicism.
  22. Protestantism and the Protestant work ethic.
  23. Manifest Destiny ie God wanted America to win.
  24. The West didn’t rise, in fact the East (Ottomans, China, Japan) sank! China banned ocean voyages in the 1430s. Japan adopted a policy of complete seclusion (sakoku) in 1640. The Ottoman Empire rejected western science and banned research after the 1700s.

Previous writers on the subject

Ferguson’s introduction references some of the many books, articles and other TV series which have tackled this ‘age-old subject’. In fact there’s a strong sense of déjà vu about the whole project. Maybe it’s a Law of History that every fifteen years or so another super-confident historian will present another blockbusting TV series describing the rise of Western Civilisation (just as it is a Law of History TV that every ten years there must be a new drama or doc series about the Tudors, or that whenever you turn on the History channel it’s in the middle of a documentary about the war). A sample of his predecessors and competitors would include:

  1. The Protestant Ethic and the Spirit of Capitalism by Max Weber (1905)
  2. The Civilizing Process by Norbert Elias (1939)
  3. The Rise of the West: A History of the Human Community by William Hardy McNeill (1963)
  4. Civilisation BBC TV series and book presented by Kenneth Clark (1969)
  5. The European Miracle: Environments, Economies and Geopolitics in the History of Europe and Asia by Eric Jones (1981)
  6. The Triumph of the West: The Origin, Rise, and Legacy of Western Civilization presented by John Roberts (1985)
  7. The Rise and Fall of the Great Powers: Economic Change and Military Conflict from 1500 to 2000 by Paul Kennedy (1987)
  8. The Military Revolution: Military Innovation and the Rise of the West, 1500–1800 by Geoffrey Parker (1988)
  9. The Clash of Civilizations and the Remaking of World Order by Samuel Huntington (1996)
  10. Guns, Germs, and Steel: The Fates of Human Societies by Jared Diamond, book 1997, TV series 2005
  11. The Wealth and Poverty of Nations: Why Some are So Rich and Some So Poor by David Landes (1998)
  12. The Great Divergence: China, Europe, and the Making of the Modern World Economy by Kenneth Pomeranz (2000)
  13. The Rise of the Great Powers (2006) 12-part Chinese TV series
  14. A Farewell to Alms: A Brief Economic History of the World by Gregory Clark (2007)
  15. Why Europe? The Rise of the West in World History, 1500-1850 by Jack Goldstone (2009)
  16. The Origins of Political Order by Francis Fukuyama (2011)
  17. How the Catholic Church Built Western Civilization by Thomas E. Woods Jr. and Cardinal Antonio Cañizares (2012)
  18. A Troublesome Inheritance: Genes, Race and Human History by Nicholas Wade (2014)
  19. How the West Won: The Neglected Story of the Triumph by Rodney Stark (2015)
  20. Why Did Europe Conquer the World? by Philip T. Hoffman (2015)
  21. The Gunpowder Age: China, Military Innovation, and the Rise of the West in World History by Tonio Andrade (2016)

Ferguson’s reasons

No shortage of writers ‘in this space’, then; no shortage of theories and reasons. Ferguson gives his list of reasons under six broad headings/programmes/chapters:

1. Competition

In the 14th century Europe contained some 1,000 polities all jostling, competing and fighting each other. Rulers encouraged ocean exploration as a way to get advantage over their rivals. Monopoly companies were invented under royal patronage to fund the exploring and pay dividends to investors. Unremitting warfare led to military innovations. Also to more efficient ways to tax subjects and to finance loans, leading to the development of government bonds and royal, then national debts, then national banks. The clock.

2. Science

The Reformation broke the tyrannical grip of the Catholic Church over secular knowledge. The printing press disseminated Luther’s revolutionary theology, then an increasing number of Protestant heresies. (Ferguson tells the striking story that when a German town tried to ban a translation of the Koran, Luther went into print to defend it – so that people could read & judge for themselves, p.63) The printing press also disseminated scientific discoveries and exchange between scholars so that the Royal Society was founded in England by 1662. As late as 1683 the Turkish army threatened to capture Vienna. However, reinforcements from Poland won the day for Christendom and the Turk was repelled. From that date stems the decline of the Ottoman Empire.

The meat of the chapter is a comparison between the impressively enlightened and intelligent ruler of Prussia, Frederick the Great (ruled 1740 to 1786), who encouraged the arts and sciences and used scientific discoveries to create a massive army, and contemporary Turkish rulers who were intimidated by their mullahs and religious intolerance to shut down scientific academies and societies, condemning Turkey to fall permanently behind western discoveries.

3. Property

North America was colonised by the British, with a well-established belief in the rights of property as the basis for representative legislatures, and therefore the promise to all settlers who cultivated their land that they could own it, along with – after all the turmoil of the civil wars – the knowledge that freedom of belief is the most practical arrangement and, there being no gold or silver or minerals, the harsh fact that everyone had to work hard to cultivate a livelihood.

South America was colonised by the Spanish, ruled from afar by a divinely appointed monarch, policed by the Catholic Church and its rigid mind police enforced by torture and the Inquisition, and which granted vast tracts of land to a handful of conquerors who used the indigenous people as slave labour to dig up an endless supply of silver.

Ferguson compares & contrasts their evolution over the following 400 years, but we all know which of the two parts of the continent became the world’s leading military, financial and cultural superpower, and which disintegrated into chronically unstable statelets, condemned to cycles of ‘revolution’ alternating with harsh dictatorship.

4. Medicine

There hadn’t been that much science in the science section – Ferguson records the dates of publication of major theories and sketches their importance in a general way, but doesn’t really explain the detail.

The same tendency to digress from the ostensible subject happens here, for this section about ‘medicine’ begins with a long account of the French Revolution, its causes and consequences, with a nod to Jean-Jacques Rousseau’s book The Social Contract, credit given to Edmund Burke for predicting the violence the revolution would bring, an analysis of the numbers of casualties in Napoleon’s military campaigns, the effect of spreading the Napoleonic Code of Law into the lands he conquered, a thumbnail sketch of Carl von Clausewitz being swept up in the wars as a boy and young man, which provided the background to his classic book On War. It goes on to describe the French revolution of 1830 and then the wave of European revolutions of 1848 which did not, however, spread to Britain, despite the unrest of the Chartist agitation, because of the British authorities’ deployment of army, police and special forces.

No mention of medicine at all so far.

There’s a further analysis of the nature of the French Empire in the Caribbean and Africa, with its distinctive mission civilisatrice, which led to the education and promotion of a number of black Africans to positions of real power between the wars, and references to the colonial education of the men who would lead the Vietnamese liberation struggle in the 1950s.

There is what you think is a detour into an account of the way the Germans ran their colonies of South-West Africa (Namibia) ie a deliberate genocide of the native inhabitants, which segues into a digression about the Great War and the way France co-opted African soldiers to fight in the trenches. There is evidence of the French military’s cynical racism in deliberately sending Senegalese troops over the top to soak up German bullets and shells and to save French skins, before the chapter sinks into the disgusting combination of eugenic theory, racist propaganda and genocidal policy which was the Nazi Third Reich.

On a few scattered pages some of the medical breakthroughs which allowed Europeans to survive in the Tropics are mentioned, along with the pioneers in the field: Louis Pasteur, Robert Koch, Alexandre Yersin – but this is overwhelmingly a chapter about the French and German empires in Africa in the decades before the Great War and then the collapse of western ‘civilisation’ into unprecedented barbarism in the 1920s, 30s and 40s.

In a way it’s a riposte to the many critics who criticise Ferguson for (allegedly) glossing over the racism and brutality of the British Empire, or of American foreign policy, in his earlier books. Here he lets us have it with both barrels and is unsparing of the homicidal, genocidal and utterly revolting racism at the core of the French, but particularly the German, imperial projects. I learned hardly anything about the achievements of western medicine in these 54 pages, but I ended the chapter feeling physically sick by the brutality of empire, and particularly disgusted by Germany, all over again.

5. Consumption

Another rambling chapter which focuses on dress, what people wear, then goes back to namecheck the main technological innovations of the British Industrial Revolution, before zeroing in on its core activity of cotton and textile manufacturing. We follow the spread of automated textile manufacture around the world, before arriving at Japan, whose leaders made a concerted attempt to westernise all aspects of their culture from the 1860s onwards (even, I was amazed to learn, considering replacing the Japanese language itself with English). Soon Japanese cotton factories were putting Indian fabric manufacturers out of business. And in 1904 the Japs prompted a war with Russia which the Japanese shocked the world by winning. And then – we are back at the Great War again, as we were in the previous chapter.

The problem with history at this level, meta-history, the history of grand perspectives and sweeping vistas, is that at this very high level in fact only a handful of things have happened: the Reformation, the Scientific Revolution, the Financial Revolution, the Industrial Revolution, the rise of the British and other European Empires, Napoleon, the 19th century, the Scramble for Africa, the Great War, the rise of fascism and Bolshevism, the Second World War, the Holocaust, the rise of America, the Cold War, the collapse of communism. Er. That’s it.

So the risk of writing meta-history is that you find yourself writing about the same subjects again and again. This thought was unavoidable as I found myself reading yet another account of the Great War which, after all, was the central subject of Ferguson’s book The Pity of War, the catalyst for decline in Empire, plays an important role in the rise of America in Colossus, and is of course a big feature in his history of the twentieth century, The War of The World. And here it is again, featuring large in two consecutive chapters of this book.

The earlier trot through the technical innovations of the Industrial Revolution had led to a digression about Marx and Engels and their theory of communism. Ferguson briskly summarises it, then just as briskly rubbishes it: the central claim that capital will be concentrated into a small and smaller number of hands until it becomes inevitable that the immiserated proletariat will rise up and create the communist utopia turns out to be rot. One way the capitalist countries side-stepped the communist scenario was by making their populations into consumers – by realising that it’s actually a good idea to pay people a living wage because then they can buy things; in fact if you pay them quite a good wage, they can buy lots of things, the things you’re selling, and your business will flourish. Thus, instead of heading for inevitable collapse, capitalism headed towards a kind of equilibrium where people are paid enough to buy all the consumer products capitalism produces. Shopping heaven. The future is not a communist utopia, it is a world full of vast shopping malls (as we can indeed see in every country which ‘develops’).

And so the chapter brings together its various strands ends with an account of the failure of communism which emphasises the inability of its centralised planning to produce consumer goods. Nuclear weapons and tanks, yes, by the tens of thousands; blue jeans and pop groups, no. Characteristically, Ferguson develops his theme via a (very interesting) account of the rise of the Singer sewing machine and the founding of Levi jeans – complete with the etymology of ‘denim’ (de Nîmes, the French city) and ‘jean’ (from Genoa, apparently).

In fact it is the immense number of fascinating facts, digressions and sidelights, which help explain why the book is so long despite its relatively simple thesis. For example, the central thread of this final section is the role played in the collapse of communism by the centrally planned system’s inability to make basic consumer goods – decent cars, fridges, TVs, clothes. Nonetheless, Ferguson finds time to tell us about the origin, concerts and then arrest of the subversive Czech pop group, The Plastic People of the Universe, and how it was these arrests which led to the setting up of Charter 77, the human rights organisation which was to become a thorn in the side of the communist authorities, and among whose founder members was the future president of the Czech republic, Václav Havel. Fascinating fact number 3,417!

In its introduction and conclusion the book has a clear, strong message – the West triumphed over the rest for the six interlinked reasons Ferguson has identified. But the actual body of the text wanders all over the place, inadvertently bringing in a host of other aspects of western culture, or wandering completely off the ostensible subject either back to his home territory of pure history, especially of empires and wars, or onto the kind of cultural trivia beloved of Grand Vista historians, suddenly treating us to a list of the most popular Hollywood movies of the early 1930s, or a paragraph explaining why jazz hit its peak with Duke Ellington’s big band sound.

Ferguson is always crisp, well written and entertaining, but this book more than any of the others is characterised by digressions and divagations.

6. Work

Ferguson explains the theory of Max Weber, one of the founders of sociology, famous for his book The Protestant Ethic and the Spirit of Capitalism (1905), which linked the rise of capitalism to the habits of discipline and hard work associated with Protestant North Europe. But barely has he dealt out lots of facts and figures about production and GDP in Western countries over past centuries, than he is going on to point out that religious belief and practice have now, alas, collapsed in the West, undermined by the consumerism he delineated in the previous chapter. This is also demonstrated by several pages of statistics about church attendance and surveys on the importance of religion in Western people’s lives: not much, is the general conclusion. One aspect of this galloping consumerism was the high levels of public and private indebtedness which underlay the financial crisis of 2008. Compare and contrast with the countries of the East, which work hard and save hard, facts which Ferguson demonstrates with a raft more stats and graphs.

— This is all true but again I have a powerful sense of déjà vu. The rise of China and the strange symbiosis we have seen in our time whereby the Chinese government has bought US treasury bonds in vast amounts and thus funded the Americans’ consumer splurge but leading to America’s vast indebtedness over the past twenty years, these were mentioned in Colossus and The Ascent of Money and now again here. In fact, it was back in 2006 that Ferguson coined the word ‘Chimerica’ to describe the unlikely partnership of China and America, along with economist Moritz Schularic. These repetitions of the same themes suggest that Ferguson has a strong and engaged view about the geo-politics and economics of the modern world and that his forays into history, entertaining and insightful as they are, are really primarily designed to shed light on the contemporary world situation, which everything swings back to.

In the final pages Ferguson discusses Islamic fundamentalism, Islamic terrorism and the rate of growth of Muslim communities in the West. He links this to the relatively quick collapse of the Roman Empire in the 400s AD, suggesting that something like the cocktail of factors we are experiencing – mass refugees, ideological terrorism, and the growth of a fifth column within – might lead quite quickly to ‘the collapse of the West’.

Which brings him, finally, to the whole theory of ‘cycles of civilisation’.

Conclusion: cycles of civilisation

Many historians who take the long view have come to believe that civilisations pass through a set pattern of rise and fall, which can be be broken down into recognisable stages. Ferguson usefully lists some of these theorists and their ‘stages’:

  1. Thomas Cole (American painter, 1801-48) set of five paintings called The Course of Empire, consisting of: The savage state; the pastoral state; the consummation of empire; destruction; desolation.
  2. Polybius (classical historian, 200-118 BC): monarchy, kingship, tyranny, aristocracy, oligarchy, democracy, ochlocracy (mob rule).
  3. Giambattista Vico (1668-1744): divine; heroic; human.
  4. Georg Wilhelm Friedrich Hegel (1770-1831): thesis; antithesis; synthesis.
  5. Karl Marx (1818-83): savagery; feudalism; capitalism; communism.
  6. Arnold Toynbee (1852-83): challenge; response by creative minorities; civilisational suicide.
  7. Pitrim Sorokin (1889-1968): ideational; sensate; idealistic.
  8. Carroll Quigley (1910-77): mixture; gestation; expansion; conflict; universal empire; decay; invasion.
  9. Paul Kennedy (b.1945): rise and fall determined by growth rate of industrial base against cost of imperial over-stretch.
  10. Jared Diamond (b.1937): civilisations rise in different ways, but all collapse because they exhaust their environmental base, be it water, cultivable soil etc.

Ferguson fails to give the biggest historical narrative of all, the Christian one, which probably underlies most of these models – God knows how many times I’ve read that one of the intellectual advantages of Christianity over the pagan world was that it offered a fully-worked out and coherent History of the Universe, with a Beginning, a Middle and an End, and a coherent purpose to everything, and that the switch from the pagan worldview to the Christian worldview was a decisive step forward in rationality, in the ability to contextualise and interpret events. Christianity’s key stages being, broadly: Creation, Old Testament, coming of Jesus, 2,000 years of history, Second Coming, the Millennium.

Ferguson also misses a trick by not even mentioning the vast swampy jungle of conspiracy theories believed by the semi-literate, which attribute historical change not to his objective cycles, but to the machinations of a long list of ‘sinister forces’, be they the heretics, the Protestants, the Jews, the Freemasons, the Illuminati, the French, the commies, the banks, and so on.

As with the 26 reasons for the Rise of the West, or the 21 books giving different explanations for it (listed above), once again you have the impression that an awful lot of learned ink has spilt on these matters with little or no solid conclusion. If history were a science we would know by now which of these fanciful theories was true, or remotely true, or true enough to be useful. But history isn’t a science – it is and always has been a form of higher entertainment.

It seems to me that both end-of-the-world theories and cycles-of-civilisation theories are the result of two fundamental aspects of human psychology:

  1. End of the world, decline and fall stories are popular in all ages because we know we are going to die, and we don’t want to die alone. We want to feel the entire world is part of our own personal decay, is going to hell in a hand-basket, and will expire just about the time we ourselves do. Paradoxically, this is reassuring because it makes us feel we are not alone. It is a way of denying the basic truth which is, ‘You know what? The world will carry on without you exactly as before; your relatives will walk away from the funeral moaning about the weather and the traffic and the government. Nothing will be changed by your death.’
  2. The proliferation of cycle theories is down to another basic trait: the obsessive need to explain everything, even where we have no evidence or understanding. Human beings anthropomorphise everything, from our pets to the weather to accidents and coincidences, there is nothing we can’t twist and distort into having a meaning and a purpose and a relationship to us, no matter how purposeless – or heedless of our little lives – the universe really is.

These psychological motivations underlie the Ferguson’s book and all the other books and theories he refers to, and explain the pleasures the book provides, even when it is straining a little to make complete sense.

For Ferguson himself is very candid about the intellectual problems which dog every step of his project: He explains that to call some things ‘civilisations’ is problematic – people obviously live and have lived in vast collectivities, but Ferguson’s early pages show us the struggle historians have in defining a ‘civilisation’. And then, that these things we can loosely define as ‘civilisations’ appear to rise and fall seems to be broadly true, but trying to decipher precise reasons or patterns may sometimes be useful, but sometimes be more misleading than helpful.

Therefore, to assert that you and you alone have discerned the ‘true reasons’ for these vast historical processes is a breath-takingly egotistical claim. Looking back over previous theorists Ferguson struggles to avoid a tone of irony and amusement at their presumption and their ignorance. At which point the reader might well say, ‘Well, what makes us think that we have the secrets to these historical processes which all previous thinkers on the matter have got so wildly wrong?’ Ferguson’s previous books have shown us how wrong, wrong, wrong economists have been about most aspects of economics; why should we believe the vaguer discipline of history is anything other than wrong, wrong, wrong about these vast metahistorical events as well?

For us readers who enjoy reading these Big Vista histories, there is pleasure, an almost childish pleasure, to be taken in reducing the lives of so many hundreds of millions, indeed billions of people, to simplistic catch-phrases and three-part or four-part or seven-part schemas. ‘Oh I know all about the fall of the Mayan empire,’ you may say, putting the book down. But you have some names and dates and theories; you don’t really know anything. And such ‘knowledge’ as these books provide, doesn’t change anything. Chinese geopolitical strategy will unfold regardless of what Ferguson writes or I think.

These books are forms of higher entertainment and Ferguson’s quality as a good value entertainer is evident on every page, in every sequence of his TV documentaries, in his magazine articles and his numerous robust TV interviews. His discourse bristles with intelligence, facts, graphs and statistics, good stories, wide-ranging geographic and historical and intellectual insights.

The fall of the American empire

But it is fascinating how this vast armoury of information and intelligence boils down to so little practical result. In the 30-page conclusion, he pulls all the preceding evidence together to argue that the previous major empires we know about collapsed suddenly (Rome, Spain, Ming China, Ottoman, British, let alone the German and Japanese or, in our time, the USSR – poof! – gone in two years). He points out the predictions of various economists that US indebtedness is set to grow to worrying levels, worryingly soon, whereas China’s growth rate could see it overtake the US as the world’s leading economy in 2020 / 2030 / 2040 (pick an expert, pick a date).

And then, borrowing extensively from the last thirty years of research in biology, zoology and physics (real sciences), he shows how complex systems in precarious equilibrium can be suddenly collapsed by apparently trivial incidents, small additions of energy or information. What if ‘civilisations’ are like that?

So the conclusion of the book, with all its thousands of facts, statistics, fascinating insights, ideas, stories and anecdotes, is that at some point in the future an apparently trivial chain of events could trigger a collapse in the US economy, put a permanent end to its global hegemony and usher in a new post-American age. And maybe China, having learned all the West can teach it, will emerge as the world’s number one power. Who can say? Maybe it will. Maybe it won’t.


Credit

Civilization: The West and the Rest by Niall Ferguson was published in 2011 by Allen Lane books. All references are to the 2012 Penguin paperback edition.

Related links

Bibliography

1995 Paper and Iron: Hamburg Business and German Politics in the Era of Inflation, 1897–1927
1998 The Pity of War
1998 The World’s Banker: The History of the House of Rothschild
1999 Virtual History: Alternatives and Counterfactuals
2001 The Cash Nexus: Money and Power in the Modern World, 1700–2000
2003 Empire: How Britain Made the Modern World*
2004 Colossus: The Rise and Fall of the American Empire*
2005 1914
2006 The War of the World: History’s Age of Hatred*
2008 The Ascent of Money: A Financial History of the World*
2010 High Financier: The Lives and Times of Siegmund Warburg
2011 Civilization: The West and the Rest*
2013 The Great Degeneration
2015 Kissinger: 1923–1968: The Idealist

* Book of the TV series

P.S. Known unknowns

It is nice to learn that there are still some imponderable mysteries in history: history’s mysteries.

  • ‘We do not know for certain who designed the first water clock.’ (p.27)
  • Why did the Chinese emperor ban ocean sailing in the 1430s? ‘We may never be sure.’ (p.32)
  • ‘We cannot be sure exactly why the Central Asian threat receded from Europe after Timur.’ (p.37)

The Ascent of Money: A Financial History of the World by Niall Ferguson (2008)

Like Empire and Colossus before it, this is the book of a Channel 4 TV series. And like them, it is a thematic not a chronological history. Thus:

  • Chapter 1 – A quick skate through the history of money and credit, starting with Babylonian clay tablets, quickly on to the rise of the Medici bankers in Florence
  • Chapter 2 – The bond market
  • Chapter 3 – The stock market
  • Chapter 4 – Insurance
  • Chapter 5 – The real estate market
  • Chapter 6 – The rise and fall and rise again of international finance

In his introduction Ferguson says the world is more truly globalised than ever before and that money in all its aspects rules everyone’s lives, which makes it all the more worrying that polls and surveys in the western world show an astonishing ignorance of even the basics of economics. Therefore he was toiled on the TV series and book to try and make economics more comprehensible and to ‘break down that dangerous barrier which has arisen between financial knowledge and other kinds of knowledge’.

For this reader, at least, he fails. By page 150 I was confused and by page 200 had more or less given up trying to understand the economic mechanisms he’s referring to. I can read the words he uses to explain the massive financial bubble caused by the renegade Scotsman John Law in France in the 1720s. But I didn’t understand exactly why the repeated issue of shares at higher and higher prices in his phantom Mississippi company were doomed to collapse. I could understand that the executives of Enron lied and cheated about their accounts – but I didn’t understand why the financial authorities and auditors who are paid to regulate these things, gave them prizes for so many years.

I didn’t grasp some of the real basics: I don’t understand why the loans a bank has made are counted as part of its assets when common sense suggests that loans are the riskiest parts of its business and so should be part of their liabilities. I found Ferguson’s account of the Wall Street Crash as confusing as every other account of it I’ve ever read, not least because the stock market had been sliding for some time, amid a confusion of other economic indicators, and it actually rallied a bit after the ‘crash’. (Wikipedia article on the Wall Street Crash.) In fact one of the most salient features of the Great Depression of the 1930s which followed is that economists are still arguing about what caused it.

Of course historians are still arguing, and will argue forever, about almost everything that’s happened, from what caused the Great War to the rise of the Nazis. They – historians – fondly imagine they provide a useful function by shedding light on the past and providing some kind of guidance for the future – whereas anyone who’s read a lot of history knows that their ceaseless disagreements provide a kind of high-class entertainment, as informative and pointless as football fans arguing whether Alex Ferguson or Jose Mourinho is the greater manager. Ie their role is purely ornamental: nobody ever learned anything from history, especially the politicians, the populations and – as detailed here in alarming detail – the financiers who enthusiastically repeat it.

With economists, however, it’s a bit more important, as economists actually run things – banks, big corporations, finance ministries and governments. If we were inclined to take the world seriously, it would be desperately worrying that economists disagree so fundamentally about so much, and use a jargon which is so impenetrable to the rest of us and which, on closer examination, bears so little relationship to reality.

If the aim of the book was to make me more economically literate, it failed because it failed to explain even the basic concepts which economics is built on. Many terms are briskly defined as the narrative speeds on its way, but too briskly for this reader – and the text then moves on to use the building blocks I haven’t properly graspe, to build up more ever more complex sentences and statements. Since I don’t understand the individual elements of the sentences, the complete statements just sound like gibberish.

For example, he briskly defines some of the (numerous) definitions of ‘money supply:

M0 (also known as the monetary base or high-powered money), which is equal to the total liabilities of the central bank, that is, cash plus the reserves of private sector banks on deposit at the central bank; and M1 (also known as narrow money), which is equal to cash in circulation plus demand or ‘sight’ deposits. (p.51)

before going on to apply these definitions in different situations. It seems obvious to me that these are ideas that you should probably spend a week of a degree course getting to know and explore and trying out in different scenarios until you are absolutely confident you have mastered every theoretical and practical implication, before you begin applying them in further theory. That time and opportunity to explore the basics of economics is not on offer here.

Similarly, Ferguson devotes seven or so pages to the Great Depression of the 1930s. I read them twice so I know that an impressive amount of banks went bankrupt and I have some of the dates clearer in my mind, but I couldn’t explain to you why it happened and I have no idea why all the clever economists alive at the time and who presumably noticed it was going on, seem to have been powerless to fix it.

Imagine you have a group of people called airplane engineers and they design and build airplanes over the course of the years and suddenly, within a few months, every airplane in the world crashes out of the sky, killing all their passengers. And the engineers have no idea why it happened. And 80 years later – they are still arguing about why it happened. Would you get in a plane?

Suppose the entire class of European politicians, planners, economists and bankers persuaded Greece it would be a good idea to join the Euro. And a few years later the kind of financial crisis which everyone knows comes around every ten years or so, comes around, and it turns out Greece can no longer pay its debtors. But as a result of being in the Euro it cannot now devalue its currency to make its debts easier to pay and its European partners won’t let it default ie abandon repayment altogether – with the result that the combined efforts of some of the cleverest, best-paid politicians and economists in the modern world have turned Greece into a slave state with record unemployment, record bankruptcies and record suicides.

Would you trust these people? These economists and financial advisers and politicians? To guide your country?

If economists struggle to this day to understand why the Great Depression happened, then why am I even bothering trying to grasp the terminology and theories of an intellectual discipline which cannot explain the most important event in its territory and offers such consistently dreadful advice to the people who run countries?

Ferguson says that, out of the fogs of squabbling economists, there do emerge two vital lessons about the Great Depression:

That inept or inflexible monetary policy in the wake of a sharp decline in asset prices can turn a correction into a recession and a recession into a depression. (p.164)

and that:

the benefits of a stable exchange rate are not so great as to exceed the costs of domestic deflation. (p.165)

I think what makes these sentences incomprehensible to me is that I don’t understand the basic building blocks, the individual ideas, from which they’re made. What is ‘monetary policy’? Obviously it’s policy to do with money, but what exactly? What is an ‘inept’ monetary policy? (What would be a ‘good’ monetary policy?) What, in this context, are ‘assets’? What is a ‘correction’? What is a ‘recession’? What is a ‘depression’ and how are they different from each other?

The second sentence is a masterpiece of magic and obfuscation. I needed an extra paragraph or two to remind me what the benefits of a stable exchange rate are, and also a bit of help grasping what deflation is and what domestic deflation is: and then a bit of help putting that all together so I really grasp it. But that help wasn’t to hand.

So reading this book involved rereading a lot of  history I knew already (the Medicis and early banking blah blah blah, Lloyds of London and the birth of insurance blah blah blah, Rothschilds build biggest bank in Europe blah blah blah) but the book completely failed to explain ‘economics’ to me. It failed to explain how the Medicis got so powerful, or why the Rothschilds or Lloyds got so big. They appear to have introduced new banking techniques and had diverse activities, as also did the five Rothschild brothers, each running a bank in a major European capital. Yes. And?

Maybe I’m particularly stupid. Maybe I have the wrong type of brain. But throughout the book, as it hurried through the history of banking and insurance and bond markets and stock markets and property markets, it felt as if I was watching an American football match where quite a lot is obviously taking place, and the crowd around me are jumping up and down and shouting but, because nobody has explained to me even the basic rules, I have absolutely no idea what’s going on, what’s important and not important, when something special happens or why.

The last two chapters – about the housing market and recent economic crashes – read, like a lot of Ferguson’s previous book, Colossus – more like extended magazine articles than history. After some stuff about the decline of the landed aristocracy in England during the nineteenth century, the real core of the long real estate chapter (53 pages) is an extended description of the Savings and Loans scandal of the 1990s and the sub-prime mortgage scandal which helped prompt the recession of 2007 (or is it 2008?) The conclusion of this section appears to say that real estate ie property, isn’t always a reliable investment. Hmm.

Similarly, I have just finished the final chapter about high finance, which opens with an interesting account of the financial collapse surrounding the Great War, but only really takes fire as it approaches the present day and describes the hedge fund boom of the 1990s and 2000s. He then does a quick couple of pages on the way the USA and China have in recent decades become tied in a complex symbiotic financial relationship, with the Chinese government funding the American deficit and Chinese factories supplying consumption-mad America with its consumer goods. Again, this had historical elements but felt less like ‘history’ than an interesting extended article from the Economist or Financial Times. After all the interesting detail, the conclusion of this essay is that a financial crisis can come out of the blue when you least expect it. Hmm. Not a blinding insight, maybe.

These chapters, like similar ones in Colossus – which purports to be a history of the US but is really about the (then recent) US invasion of Iraq – tend to suggest that Ferguson is less a historian in the traditional sense than an impassioned commentator on current political and financial affairs who takes an unusually historical point of view, or uses an unusually large number of historical examples to shed light on  his analyses of the contemporary world.

Confidence sapping

If I came away with one over-riding impression, it is that economic theory has always struggled to catch up with the actual behaviour of incalculably greedy and clever men who are always devising financial structures and models way ahead of the theorists, politicians and regulators, and which almost always come to grief.

If there is one compelling conclusion from the book, it is that economists don’t know what they’re talking about. Again and again Ferguson introduces another tale of greed and folly with words to the effect of, ‘Until 19XX the conventional wisdom was that YY’, before going on to show, again and again and again, how received opinion among economists was overthrown by what actually happens in the world. ‘Bucking the trend’, ‘hardly anyone expected’, ‘nobody could have predicted…’ – by telling so many tales of financial disaster at such length Ferguson, presumably unintentionally, rubbishes the pretensions of his own subject.

Take pages 321 to 330, which describe the pioneering investment theory of a company called Long-Term Capital Management, set up in 1994 by Myron Scholes, an academic, and Fisher Black from Goldman Sachs who were  soon joined by another economist from Harvard Business School, Robert Merton. They devised an impressive mathematical formula for the optimum management of ‘option contracts’ (which, like so many of these concepts, I struggled to understand). They teamed up with a Federal Reserve vice-chairman, a Harvard professor and superstar traders from various firms, along with investment bank backing to set up the company, and started making a lot of money.

The best thing about this story is that after just three years, in 1997 Scholes and Merton were awarded the Nobel Prize for Economics. The Nobel Prize! In September the next year their firm went bankrupt, only surviving because of a $3.6 billion bailout by Wall Street banks, frightened of the knock-on effect its collapse would have on the other major financial houses of America. Truly a Nobel Prize-winning achievement.

The net effect of this book is to undermine your faith that anybody really understands what is going on in the world of money, and to make that world seem a much more anarchic and dangerous place than you already feared.

Related links

Bibliography

1995 Paper and Iron: Hamburg Business and German Politics in the Era of Inflation, 1897–1927
1998 The Pity of War
1998 The World’s Banker: The History of the House of Rothschild
1999 Virtual History: Alternatives and Counterfactuals
2001 The Cash Nexus: Money and Power in the Modern World, 1700–2000
2003 Empire: How Britain Made the Modern World
2004 Colossus: The Rise and Fall of the American Empire
2005 1914
2006 The War of the World: History’s Age of Hatred
2008 The Ascent of Money: A Financial History of the World
2010 High Financier: The Lives and Times of Siegmund Warburg
2011 Civilization: The West and the Rest
2013 The Great Degeneration
2015 Kissinger: 1923–1968: The Idealist

Colossus: The Rise and Fall of the American Empire by Niall Ferguson (2004)

The United States invaded Afghanistan in October 2001 as a result of the 9/11 attacks. It invaded Iraq in March 2003 in response to the alleged threat of Saddam Hussein’s weapons of mass destruction.

These acts prompted an unprecedented flood of articles in newspapers and magazines, TV documentaries, conferences, seminars, papers and hundreds of books speculating whether America was now, finally, at last revealed to be an ’empire’ with nakedly ‘imperial’ ambitions.

British economic historian Niall Ferguson entered the debate with a Channel 4 TV series and book on the subject – which also neatly complemented the C4 TV series and book he had published in 2003 about the British Empire.

When I bought it I thought, from its subtitle (‘The rise and fall of the American empire’), that it would be a history, maybe a chronological account of the growth of American power.

But it isn’t. Even more so than the British Empire book, this book is really an extended argument with historical examples. It is a polemical interpretation of history, written with a very strong point of view, which starts in the present day – the Preface, written in 2005 is full of references to contemporary events in Iraq, to ongoing debates in the media, policy statements by the Administration, learned articles etc – and, no matter what incidents from the past it describes, Ferguson is always emphasising their relevance to the present situation.

However, time has a way of advancing at a steady pace: it is now 12 years since the book (11 years since the preface) were published, and we have the usual benefit of hindsight, both on America’s strategic decisions, and on Ferguson’s interpretation of them.

The book can therefore be read and enjoyed on at least three levels:

  1. As a snapshot of contemporary thinking about US policy in Afghanistan/Iraq in 2003/4
  2. As an extended argument about the role of the US in global affairs, with which to agree or disagree
  3. For the illustrations of that argument which include a succession of fascinating accounts of episodes from US history which shed light on the empire thesis (and other things too)

An empire in denial

Ferguson’s thesis can be stated very simply: the US is an empire; despite all protests to the contrary, it always has been an empire; in fact it would be a good thing for the world as a whole if the leaders of America just accepted the fact and began to act more like an empire; instead of which America’s rulers have a long tradition of intervening for short periods in foreign countries, then withdrawing in a hurry and letting them revert to chaos/civil war/instability. Ferguson’s thesis is that Americans should stay in the countries they invade, and be prepared to pay the cost.

The way he puts it is that America is an ’empire in denial’. In reach and power, in its conviction of being a torch bearer of civilised values – freedom, democracy, free market capitalism etc – in the sheer fact that its armed forces outnumber the next ten or so nations’ armies put together, and that it has military bases in half the nations of the earth – America is an Empire in everything but name.

The book is – maybe intentionally – comic in the way it lines up quotes from US presidents and senators and commentators from the late 19th century onwards, all saying the US is not an empire and carrying on vowing it does not have imperial ambitions etc, through the Second World War – notably the fiercely anti-imperial Franklin Roosevelt, who played a large role in undermining the British Empire – and right up to the present day, asserting, ‘No empire, no way!’

Then follows all these denials with an account of

a) how America was created ie by killing Indians, seizing territory, fighting neighbouring countries, buying land
b) once the continental boundaries were settled, reaching out to acquire colonies in the Pacific and Caribbean, by sometimes pretty underhand dealing
c) the growing chorus of commentators who, especially after WW2, simply recognise US behaviour for what it’s been – stepping in to fill the power vacuum left by the bankruptcy of the British Empire and feeling free to intervene in conflicts anywhere in the world to influence them in the ‘right’ direction. The American direction. Korea, Suez, Iran, Vietnam, Iraq.

Not new

That America is an empire is not a new thought, in fact it is a cliché of our times. You only have to Google ‘American empire’ to be appalled at the amount of learned ink and journalistic hype which has been spilt debating the point back and forth for the past 15 years. Ferguson claims that what makes him stand out from this vast sea of discourse is that he thinks an American Empire would be a good thing, and that the Americans, alas, don’t go far enough. For Ferguson the Americans have, like it or not, become the world’s main guarantor of peace, liberty, democracy, capitalism and free trade – but are continually shooting themselves in the foot by not doing it properly.

For my money what makes Ferguson stand out from the scrum of people in this arena is that 1. very few of the political commentators have the breadth and depth of knowledge he brings to bear as a professional economic historian – and 2. not many of his fellow historians have a taste for writing such partisan and polemical pieces with such verve and confidence.

Structure

In the introduction Ferguson outlines the structure of the book in eight chapters:

  1. The imperial origins of the USA ie the way the Founding Fathers themselves (surprisingly) used the term ’empire’, and the way the young nation bought, fought and conquered its way across the continent and beyond.
  2. A fascinating account of America’s successes (Hawaii and Puerto Rico) and failures (the rest of central America and the Caribbean): drawing the conclusion that it has been most successful where it directly and permanently intervenes and governs, and repeatedly failed when it intervenes to overthrow a dictator and quickly withdraws (Panama, Nicaragua), leaving the fundamental problems of poor governance unchanged.
  3. Showing how 9/11 represented a culmination of decades of mismanagement of the Middle East and of growing Islamic terrorist organisations which the US did little to tackle.
  4. How the failure of the UN in the Yugoslav civil wars and the Rwanda genocide showed the US it could and should go it alone, proving that all decisive action in the post-Cold War world requires is a ‘coalition of the willing’; and how the disasters of small-scale US intervention in Somalia and Lebanon suggested that the US should only intervene in situations with a clear end-goal and then only with overwhelming force.
  5. Assesses the costs and benefits of America establishing a true empire, ie permanently occupying failed states.
  6. This is a detailed essay which could easily stand alone, assessing whether the US has the capacity, know-how or staying power to remain in Iraq long enough to build a viable nation state, cheekily comparing its quick-fix approach to the history of Britain’s long stay in Egypt. The British officially stated no fewer than 66 times that they would clear out of Egypt, starting within weeks of their unofficial ‘conquest’ in 1882; whereas they ended up staying for 72 years, Ferguson controversially argues, much to Egypt’s economic and legal benefit. Another element in America’s weakness is the reluctance of Americans to serve abroad. Most get postings to the Middle East for a year and are soon back home among the hamburgers and soccer moms. This makes you appreciate rather more the selflessness of lots of British administrators who devoted their entire lives to ‘serving’ in often very remote parts of the world, with little thanks at home or from the native peoples, stiffened by the ethos of service and self-sacrifice which had been drummed into them in Britain’s public schools. There is simply no equivalent in American culture.
  7. This chapter also feels like a stand-alone essay on the simple question: Is the European Union a viable new ’empire’ capable of asserting western values through unified force in a way which can challenge the United States? Well, No. Ferguson very thoroughly demolishes the idea and confirms one’s sense that the EU is a ramshackle bureaucracy dedicated to guaranteeing its employees a fabulous lifestyle and protecting French farmers, while completely failing to act decisively in any kind of emergency, from the Yugoslav civil wars to the the current Refugee Crisis via its wise and fair treatment of the defaulting Greeks.
  8. Many critics and commentators predict the American Empire will be brought low by what Paul Kennedy called ‘imperial overstretch’ and go bankrupt like the great empires before it. Ferguson brings his grasp of historical economics to bear to argue that the real threats to the US economy are in fact internal. The largest elements in the US budget are not military but the vast obligations of Social Security (pensions) and Medicare. Politically, the threat is not of over-stretch but of over-hasty withdrawal of forces form trouble zones, under pressure from domestic public opinion and ever-recurrent US isolationism. Once again, leaving the job half-done.

And this concern does seem to have been justified. As the Wikipedia article on the withdrawal of US forces from Iraq makes clear, President Bush held out against a Congress and public opinion calling for the troops to come home from 2007 onwards, signing an agreement that the last ones would leave in December 2011. Since that time the main development in the region has of course been the popular uprising in neighbouring Syria against President Bashar al-Assad, which led to a civil war, which, along with a power vacuum in northern Iraq, led to the swift emergence of a new force, Islamic State.

Whether the rise of ISIL could have been prevented by maintaining US forces in Iraq is something historians will debate forever. How many forces, exactly? And for how long?

Insights and stories

As with Empire, a lot of the basic story is familiar, especially the recaps of the disasters of the 1990s (Yugoslavia, Rwanda) and the detailed account of the diplomatic pussy-footing to get the UN resolutions and allies needed to invade Iraq. I feel like I’ve read hundreds of articles and books on the subject.

By contrast, his chapters on the early history of the American republic, and then its interventions in Latin America, the Philippines, Hawaii etc, were mostly new to me. Certainly the way they are interpreted in light of Ferguson’s thesis – ie from its earliest days the US has been imperial in ambition, and that its best interventions have been the most complete and overt ones – were new and thought-provoking.

  • The Louisiana Purchase (1803)
  • War of 1812 I hadn’t quite realised the States started this war simply to grab land, nor that the small British forces fought back so effectively that they pushed the Yanks back to Washington where – in the war’s most famous incident – they burned down the White House. Nor that the war helped create a sense of Canadian nationhood among the people that pushed back the Americans.
  • Mexican-American War (1846-48) resulting from the US annexation of Texas and leading to the acquisition of more land ie southern California and New Mexico.
  • Overthrow of Hawaii’s rulers I didn’t know how completely imperial the seizure of Hawaii was, with the overthrow of the native royal family by a small group of white businessmen. The reluctance of the authorities back in Washington to back the obvious greed and illegality of the men on the spot is like many episodes in the British Empire, where the central government was in fact more protective of native rights than the self-interested businessmen who behaved so high-handedly.
  • Spanish-American War (1898) On a trumped-up pretext the US invaded and annexed Cuba from Spain.
  • Philippine–American War (1899-1902) As part of the Spanish-American war, the US seized the Philippine Islands from Spain, on the other side of the world. Military victory was straightforward but followed by a prolonged counter-insurgency which the Americans tried to solve by driving the general population into concentration camps and shooting everyone found outside the camps without identification. Guerrilla war phase
  • Panama In the early 1900s the US supported Panama independence from Colombia so that it could instantly sign a treaty with the new ‘country’ to build, own and run the Panama Canal in perpetuity.
  • Puerto Rico is currently ‘an unincorporated US territory’. Reading the Wikipedia article about its ‘acquisition’ by the USA gives powerful evidence of the imperialist mind-set and language used by American leaders at the turn of the century.

And so on…

Is it or isn’t it?

So is America an empire? The obvious answer is, Who cares?

Well, who does care is the thousands of analysts, pundits, professors and think tank geeks, military experts and geopolitical strategists, who are paid to write and debate this kind of question ad nauseam. For them it means publication, reputation, careers to be made debating the finer points of the matter, creating subtler and subtler definitions of empire, making more and more ornate comparisons with previous empires, publishing sophisticated and thought-provoking prognostications, most of which turn out to be wildly wrong (eg Paul Kennedy’s predictions that the American Empire would soon collapse in his popular best-seller The Rise and Fall of The Great Powers of 1987).

A slightly more engaged answer would be: Since I have just read the views on the matter of some 50 people, from various Founding Fathers, through politicians and commentators in the 19th century, the Great War, the Second World War and right up to the present day, who themselves disagree wildly as to what an empire is and whether America is or isn’t one – how can I reasonably be expected to decide?

From the evidence in this book, the United States both is and isn’t an empire: it is by virtue of its military power and reach and it has a track record of annexing land (in the 19th century) and military intervention in other countries (in the 20th). BUT, as Ferguson points out, it rarely stays. It is obviously NOT in the business of seizing new colonies and permanently inhabiting them, as the Spanish, French, Dutch, Portuguese, British, Germans, Belgians or Russians did with their empires. Hence: the US is and isn’t an ’empire’.

Whether any of this ocean of interpretation makes a blind bit of difference to the actual course of events, to the working out of US geopolitical strategy, seems unlikely. American politicians are trapped in the tight cycle of elections to the Senate, Congress and Presidency, which tend to prevent any long-term thinking and favour melodramatic gestures and simple-minded sound-bites (eg Donald Trump). From one point of view it was a triumph that President George W Bush managed to keep US troops in Iraq for so long, before giving in to domestic pressure, bringing them home, and letting the country collapse into fragments and then fall prey to a murderous new movement, ISIS.

Thirty years ago I attended a seminar which featured Ian Jack of the Observer and other foreign correspondents and experts debating whether Imperialism should be revived, whether the West should intervene – mainly in Africa – to overthrow brutal dictators or help collapsing states, and run them properly. Everyone there – white, middle-class intellectuals all – agreed it was obviously the best solution for a number of pitifully poor countries. But also agreed it was impossible in practice – because of the fierce opposition there’d be from the populations of the recolonised countries, from the UN and international community, from the surrounding nations and related bodies like the Organisation of African Unity, and from the Western countries’ own populations. Faced with opposition on all fronts, the idea of recolonisation was a non-starter: the West would have to resign itself to working through the various UN agencies, the IMF or World Bank, and its armies of NGOs and aid charities to make the best of a bad job. Direct intervention to ‘save’ collapsing or dictator-led countries could never again be a long-term possibility. Failed and chaotic states are on their own and can never again expect to be taken over and helped to rebuild.

Nothing I read in Ferguson’s book contradicts those conclusions.

Criticism

The most obvious criticism of this book, as of its predecessor, Empire, is that it gives little or no place for human experience, for the psychology of colonisation and oppression. An imperial colony’s legal system may be updated, its tax regime overhauled and its GDP improved by imperial control – and Ferguson gives plenty of examples of this in a wide range of countries, run by the British or Americans – but he takes hardly any account of people’s feelings, or of the cultural impact of being ruled over – and more or less overtly patronised by – an alien elite. For this absence of feeling, of compassion maybe, Ferguson has been criticised, especially by writers who come from former colonies and who have experienced the humiliations of empire.

My view would be that this high-level, heartless approach is hardly unique to Ferguson: all economists are like that. While Britain’s state industries were shut down, while the mining communities were thrown on the scrapheap during the Thatcher years, generations of culture were trashed, alcoholism and suicide rates soared among unemployed men, the Financial Times and its ilk were full of reports by economists discussing theories of money supply, the finer aspects of ‘Monetarism’, and the balance of payments deficit as if there was no connection between the graphs and pie charts and ruined lives. Or read how the plight of Greece was described in the Financial Times.

Economics isn’t called ‘the dismal science’ for nothing. Its fundamental strategy is to drain the humanity and life out of any situation and to reduce it to bone-dry, bloodless and – quite often, it turns out, laughably unreliable – numbers.

At least, unlike most other economic historians’, Ferguson’s books are thought-provoking, crisply written and hugely entertaining.

Related links

Bibliography

1995 Paper and Iron: Hamburg Business and German Politics in the Era of Inflation, 1897–1927
1998 The Pity of War
1998 The World’s Banker: The History of the House of Rothschild
1999 Virtual History: Alternatives and Counterfactuals
2001 The Cash Nexus: Money and Power in the Modern World, 1700–2000
2003 Empire: How Britain Made the Modern World
2004 Colossus: The Rise and Fall of the American Empire
2005 1914
2006 The War of the World: History’s Age of Hatred
2008 The Ascent of Money: A Financial History of the World
2010 High Financier: The Lives and Times of Siegmund Warburg
2011 Civilization: The West and the Rest
2013 The Great Degeneration
2015 Kissinger: 1923–1968: The Idealist

Empire: How Britain Made the Modern World by Niall Ferguson (2004)

Sir Richard Turnbull, the penultimate Governor of Aden, once told Labour politician Denis Healey that, “when the British Empire finally sank beneath the waves of history, it would leave behind it only two monuments: one was the game of Association Football, the other was the expression ‘Fuck off’.” (p.365)

Niall Ferguson is a bit of a rock star among historians – youngish, good looking in a rugged Scottish way, he’s been the presenter of a number of TV history series for Channel 4, writes combative articles for newspapers and magazines here and in the States, has been a contributing editor to Newsweek, the Daily Telegraph and the Financial Times, has actively helped US Presidential campaigns, appears regularly as a pundit on TV shows – all logged and available on his busy website.

Three things make him stand out:

1. He is an economic historian He has an impressive grasp of the economic and banking and business aspects of history. Most history books rely on government and administrative documents and interpret policy in terms of political parties or the individual psychology of a Disraeli or Churchill, with a smattering of culture (quoting poems) thrown in. For their part, most economic historians are dry specialists, working deep in the bowels of Treasury or corporate archives to produce very technical tracts.

But in the book which brought him to general attention, The Pity of War, Ferguson combined his economic perspective with a popular style and approach, taking a detailed look at defence budgets, steel production, armaments output and so on, to present the Great War from a purely economic point of view, resulting in a number of surprising insights & conclusions.

Ferguson’s unique selling point is his ability to cut through political discourse to show the economic realities – the profit and loss, the problems of issuing bonds, obtaining credit, securing loans, paying back interest, finding new markets, keeping down overheads – the sheer business of the Empire, and the challenges it threw up and the difficult decisions political and business leaders had to take as a result.

2. He is an unashamed capitalist He’s not a Marxist or a socialist or a liberal, he isn’t into cultural studies or feminism or post-colonial studies, as so many contemporary historians are. He is an unabashed Thatcherite capitalist. He has been employed by New York investment banks and has worked for Republican presidential candidates. Despite its obvious inequalities, he defends free market capitalism as the bringer of prosperity and freedom to all the countries which embrace it. After all – look at the alternatives.

3. He is a populist Three of his books are based on Channel 4 TV series which he wrote and presented – this history of the British Empire, another on the Rise of America, and the third on reasons why the West beat the Rest to world domination (all handily available to view on YouTube). He is not shy of tackling the Big Subjects.

Having worked for Channel 4 myself, I know that they value controversy above anything else, they like to encourage contrary and unexpected viewpoints, they like to feel they are stimulating debate. Ferguson, with his confidently conservative views, his brash way with economic statistics, and his Celtic good looks (it is a visual medium, after all) was perfectly placed to present the series and write the books on these epic subjects. He will have mapped out the overall approach or message – broken it down into hour-long episodes / chapters, which are built around key (ideally, controversial and ‘against received opinion’) propositions. Then teams of assistants will have been despatched to assemble the material required to fill them out. ‘We want striking locations, powerful stories, strong messages!’

This, the first of the three books-of-the-series, is hugely enjoyable, fluently written, full of deliberate provocations and journalistic summaries, pithy phrase-making and telling stories (I liked his quip that if Britain was a nation of shopkeepers, Australia started out as a nation of shoplifters) – liberally studded with graphs and diagrams displaying impressive-looking arrays of figures for the economically illiterate. It is designed to impress and persuade a broad popular audience, of which I am one.

Empire is a solid-looking Penguin paperback of medium length for such a vast subject (380 pages) and divided into six chapters which summarise the narrative arc of the story – Why Britain?, White Plague, The Mission, Heaven’s Breed, Maxim Force, Empire For Sale.

The British Empire A Good Thing

The biographical background sketched above helps to explain why Ferguson’s history ruggedly and abrasively declares the British Empire was a Good Thing. It had its fair share of atrocities, terrible behaviour, oppression and subjugation. But overall, on balance, from a high-level perspective, Ferguson in his Introduction asserts the British Empire was a civilising, globalising influence, and then spends the rest of the book going into detail to back his assertions.

The Empire was a good thing because it:

  1. Imposed free market capitalism around the globe, encouraging the free movement of goods, capital and labour on a vast scale.
  2. Spread the rule of law, specifically English common law, fairer, quicker, more efficient than other systems.
  3. Spread English forms of land tenure, which encouraged investment and development.
  4. Spread representative democracy: this has survived in eg India, to the ex-colonies’ lasting benefit.
  5. Spread the idea of a small, incorrupt state: its critics may have criticised Imperial administrators for arrogance and sometimes criminal neglect; but they weren’t venal and corrupt, and the administration was astonishingly small: at its height, the Indian Empire of 250 million was administered by a civil service of 1,000.
  6. Spread the English language.
  7. Spread Anglican Protestantism.

British ideals

Lastly, he emphasises the way the Empire disseminated English ideas of personal liberty. Critics immediately reply, ‘How could an Empire devoted to freedom have made so much money out of slavery?’ Ferguson doesn’t underplay the cruelty or neglect of the Imperial authorities. There are strong passages about slavery, including his description of visiting the slave cells on the West coast of Africa. But the history of the Empire can be split into two parts, Slavery and post-Slavery. Anybody who condemns the British Empire for its use of slavery needs to be reminded that it was the British who were the first nation anywhere in the world to outlaw the slave trade (1808), to abolish slavery altogether (1833), and then to enforce that ban on other nations. The Americans, famously, fought to defend Slavery into the 1850s.

Ferguson makes the profound point that, no matter how rapacious, violent or unjust its activities abroad, there was always a strong party at home which tried to hold the Imperialists to account against the highest standards. Even if the ideal of liberty was betrayed again and again in practice, it was nonetheless an ideal that a significant number of Britons aspired to, and the anti-slavery movement is proof of its power. (After all, a generation earlier, the American colonists had rebelled against their king in the name of a higher ideal than monarchy, in the name of Freedom, and a lot of 18th century Englishmen sympathised with them.) Thus, throughout the nineteenth century, economic and political Liberals criticised the idea and the implementation of Empire, against a range of higher ideals about freedom and national independence.

It was the very power of this British notion of liberty, holding the Empire’s rulers to account against nobler ideals, which meant the Empire’s days were always numbered. By about 1900, as domestic discourse became divided between shrill Imperialists (Kipling, Rhodes) and even shriller opponents (Gladstone’s heirs like John Hobson, author of the stinging critique, Imperialism) the whole idea of Empire was becoming difficult to defend, when it was dealt a body blow by the stupidity of the Boer War.

The alternative empires

The grossest, the most obvious defence of the British Empire is – Look at the alternatives. Empire critics tend to base arguments on the notion that, if the British hadn’t arrived, the ‘native’ red Indians, or Indians or Africans or Maoris or Aborigenes would have continued living their environmentally-friendly, spiritual lives. But no they wouldn’t have. They would have been colonised by the Spanish, Portuguese, Dutch, French, or God forbid, the Belgians or Germans. And, after the Great War, in the 1930s, the new empires were the totalitarian ones of the Japanese, the Russians and the Nazis. Without a shadow of a doubt, much much worse.

The Soviet Union, the Nazis, the fascist Japanese did not emphasise the rule of law, did not have powerful parties at home holding the Imperialists to account. Critics of their totalitarian policies were shot. Opponents in colonised countries were shot. Anyone complaining about British rule in the 1930s should spend a few minutes reading about the Japanese Rape of Nanking, or the way Germany behaved in its new East European colonies after 1939.

The economic end of empire

Ferguson is perhaps deliberately controversial, when he asserts that what ended the British Empire wasn’t the various rag-tag nationalist movements which agitated in their countries (Sinn Fein, the Indian Congress, Mau Mau) it was that in a few short years Britain comprehensively bankrupted itself fighting off other empires which were significantly worse, undoubtedly evil.

He gives pages of figures showing the collapse of Britain’s economy in the 20th century, begun in the Great War and ruined in the second. We were only able to continue fighting after 1940 because of huge American loans. Whatever the military or diplomatic facade, the baton for policing the world and combating evil empires had been handed on to America, an America reluctant to take on the role.

How the British made the modern world

Despite listing the things the British Empire gave to the 25% of the world it governed, I thought the book didn’t really address its subtitle, ‘How the British made the modern world’. In the introduction and again in the conclusion, Ferguson repeats the roll call listed above, but I don’t think that’s quite the same as showing how Britain made the modern world. All kinds of other things made the modern world as well. Oil. Coffee. Cars. Airplanes. Computers. Some Brits might have had a hand in some of them, but so did Germans, French, Americans.

Instead, the lion’s share of the text is taken up with a fairly traditional narrative of the key events in the Empire’s history, with a kind of running economic commentary. Insofar as it is a chronological narrative, it covers an awful lot of familiar ground, albeit littered with entertaining stories and stunning stats. So we get:

  • The early years, the Elizabethan settlements in Ireland and America.
  • A history of the East India Company as it takes over pieces of India piecemeal, fights off the French, in the 1700s, develops its own army.
  • The Slave Trade: the triangle of trade taking slaves to Africa, sugar from the Caribbean to Britain, then gewgaws to buy more slaves back in West Africa, from the 1600s until  the rise of the Evangelical anti-Slavery movement in the 1790s.
  • As we move into the Victorian era, the narrative thickens, becomes slower and more detailed, as:
    • Britain invents loads of stuff, better maps, theodolites, the steamship, the steam engine, iron, coking coal, factories, the telegraph – and sends explorers deeper into Africa.
    • The Indian Mutiny (1856) transforms Imperial power in India from its old relaxed amateurish basis, onto a more formal, hierarchical affair.
  • And thickens further in the era of High Imperialism from the 1880s onwards, as we fought small wars all across Africa and northern India – the era of the Great Game, Kipling, Pomp and Circumstance etc etc.
  • Then the twin catastrophes of the Boer War which sowed the seeds of doubt about the morality of the whole thing, and then the catastrophe of the Great War.
  • The odd twilight between the wars when we still had an Empire, in fact it reached its widest geographical extent, but somehow nobody took it seriously any more, except pompous administrators collecting gongs.
  • And then the hurried decolonisation between 1947 and the 1960s, marred by last-minute crackdowns in Cyprus, Malaysia, Kenya.

An over-familiar story?

A lot if not all of this is familiar from other books I’ve read, like Robert Hughes’ harrowing history of Australia, The Fatal Shore (1986), Robin Blackburn’s The Making of New World Slavery (1997), Thomas Pakenham’s The Scramble For Africa (1991), Lawrence James’s The Rise and Fall of the British Empire (1994), The Crisis of Imperialism by Richard Shannon (1974), Jan Morris’s Pax Britannica trilogy (1968–78), Eric Hobsbawm’s The Age of Empire 1875-1914 (1987).

Like these predecessors Ferguson takes this well-worn story and tries to make it new by studding it with telling anecdotes or accounts of significant figures, garnished by sections on the economics of imperial trade or slavery or the East India Company etc. These economic sections, frequent though they are, somehow don’t have the same impact. A graph about, say, English net migration 1601-1801, while mildly interesting, has little or no impact compared to the 40 or more pages he devotes to a long biographical sketch of David Livingstone, from his impoverished childhood, through his training as a doctor and missionary, and then a thorough account of his adult explorations. Or the long account of Indian Viceroy Lord Curzon, seen as epitomising the cultural moment of high Imperial pomp in India.

Imperial legacy?

In this book and in the Tate Britain exhibition about Artist and Empire I went to recently, I read that the legacy of Empire is ‘all around us’. Hmm. I don’t really agree. My daily commute to Clapham Common, travelling by Tube to Old Street, walking through dirty streets to a 1970s concrete tower block where I work for part of the NHS – not much of that strikes me as a legacy of the British Empire. It all happens to take place in the capital city of the same country, but none of those things were created by or for the British Empire. (Indeed, Ferguson points out that the cost of the NHS and the new welfare state, created after the Second World War, was one of the reasons running an empire became unaffordable.)

To me the most obvious and by far the most important legacy of the British Empire is America. America is the world’s superpower. We founded it, gave it its language, religion and political ideals, and then it grew up and went its own way.

The next most important thing we gave the world was the Industrial Revolution: coal and iron and steam power, railways, electricity, the telegraph and telephone, preparing the way for the oil economy – cars, airplanes and computers. These are the real and immediate physical and technological presences in the life of me and most Londoners. The fact that Indians have parliamentary democracy or Ghana’s judges wear British wigs or Australians play cricket are nice aspects of the world, but as irrelevant to me as the statues of all the generals and viceroys who line Whitehall.

Grace notes

In such a densely researched account, packed with stories, quotes, biographical accounts, facts and figures about such a vast undertaking over such a long period, a number of thoughts stood out, things I never knew or had forgotten, twists or turns in the familiar story:

  • The composer of the hymn Amazing Grace, John Newton, became a slaving captain after his born-again religious conversion.
  • Obviously I knew about David Livingstone: I didn’t know (or had forgotten) that Livingstone’s explorations were based on an economic theory ie mid-Victorian laissez-faire capitalism. Livingstone was a life-long opponent of slavery but he completely failed to make Christian converts among the Africans he visited or to persuade the African and Arab slavers to cease trading. Therefore, he switched his activities to a messianic mission to ‘open up’ Africa, to carve trade routes into deepest Africa, in the belief that, once British traders and businesses could be persuaded to set up trading posts, to start to grow coffee or cotton or whatever in the areas he opened up, free trade would kill off the slave trade. It would simply become more profitable to let Africans do honest labour in their own regions and rake in a profit, than to capture them and drag them down to Zanzibar in chains.
  • By the 1830s and 1840s 40% of the total value of Indian exports took the form of opium. The fact of the Opium Wars against China in which we stole Shanghai and Hong Kong never ceases to amaze me.
  • The very Evangelical Christians who powered the anti-slavery cause and successfully abolished the slave trade, then set their sights on converting the heathen in India, but the rapid growth of missionary societies and missionaries in the field trying to convert Hindus and Muslims was to have a disastrous result. Ferguson says that one of the main contributory factors of the Indian Mutiny was that the soldiers of the Indian Army felt their religion was under threat from the floods of missionaries.
  • The Indian Army was a vital support of the Empire. By the 1880s 62% of all the soldiers of the Queen were Indian. In autumn 1914 about a third of British forces in Flanders were from India. By the war’s end a million Indians had served, as much as the four white Dominions put together.

The Channel 4 TV series

Related links

Bibliography

1995 Paper and Iron: Hamburg Business and German Politics in the Era of Inflation, 1897–1927
1998 The Pity of War
1998 The World’s Banker: The History of the House of Rothschild
1999 Virtual History: Alternatives and Counterfactuals
2001 The Cash Nexus: Money and Power in the Modern World, 1700–2000
2003 Empire: How Britain Made the Modern World
2004 Colossus: The Rise and Fall of the American Empire
2005 1914
2006 The War of the World: History’s Age of Hatred
2008 The Ascent of Money: A Financial History of the World
2010 High Financier: The Lives and Times of Siegmund Warburg
2011 Civilization: The West and the Rest
2013 The Great Degeneration
2015 Kissinger: 1923–1968: The Idealist

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