British austerity culminated in forced departure from the gold standard in 1931

Evidence

The minority Labour government, in charge since 1929, was devoid of alternative economic ideas and went along with austerity policies sufficient to worsen the economy but insufficient to right the deficit. When the Labour government fell over how deep to cut, it was replaced by the National (coalition) Government. It enacted sufficient spending cuts and tax increases to convince J. P. Morgan and Company to lend Britain $200 million. But the loan was too little and too late to make a difference. With official reserves almost depleted (no gold cover) and unemployment at record levels after a decade of austerity policies, this final round of austerity forced Britain off the gold standard in September 1931. — Mark Blyth, Austerity, 517

Categorization

• XREF: Connects to Mattei’s austerity critique as historical precedent for pre-2008 demonstrations that cuts worsen economies rather than fixing deficits. — connects to: Leaving the gold standard and sharing adjustment costs ended Swedish austerity. — Mark Blyth, Austerity: The History of a Dangerous…, 524; Gold-standard return caused depressions across Britain, Japan, and France — Mark Blyth, Austerity: The History of a Dangerous…, 557; Britain’s gold-standard austerity doubled unemployment from 10.4 to 22.1 percent — Mark Blyth, Austerity: The History of a Dangerous…, 514 (+6 more)
• DEFINE: Shows the ‘Treasury view’ as the intellectual ancestor of austerity policy doctrine.

Broader Connections

• Britain’s gold-standard return demanded prolonged deliberate deflation #expands (0.92) — Clara E. Mattei, The Capital Order, 995
• British monetary austerity after 1920 produced an unhealthy quasi-equilibrium for a full decade #expands (0.90) — Clara E. Mattei, The Capital Order, 1731
• Monetary austerity, by raising sterling, crushed British exports and unions #expands (0.85) — Clara E. Mattei, The Capital Order, 414
• High Bank rates triggered a deflationary spiral in 1920s Britain #expands (0.85) — Clara E. Mattei, The Capital Order, 1697