Thursday, 16 September 2021

How Britain became a manufacturing economy

Britain became a manufacturing economy during the reigns of Henry VII, VIII and Elizabeth. The monarchs may have been directly involved in this, quite probably Henry VII was, and or their fixers such as Wolseley and Cromwell. Or unknown merchants of the time. (There's a PhD in this)

Prior to the 1480s when Bill Stanley grabbed the crown for Henry, Britain was a major supplier of wool to manufacturers in the low countries. The wool was made into garments there and sold across Europe. Much of the finished goods were exported to England. In a situation like this, the manufacturer of the finished products has the advantage and is the one who makes the money.

Let's assume Henry initially took command of this aspect of the English economy and trade.

He wanted England to be a manufacturer of finished wool goods as well as a supplier of raw wool. Manufacturing woollen goods was a highly skilled and technically advanced process involving machinery and craft skills not available in England. So Henry had to develop and nurture this manufacturing process.

Perhaps he set up looms, trained the craftspeople and mechanics and competed on the open market like the Thatcherite myths would have it. No, he didn't!

He put embargoes on the exported raw wool and limited imports. He used import taxes and quality regulations to protect the fledgling English industry. This forced technology and skills to grow rapidly in England with the help of Flemish weavers tempted over here. (It's where the name Fleming comes from)

The Henry's and Elizabeth didn't stop when they were competing on equal terms with the low country manufacturers. They hardened the tariffs, taxes, regulations and embargoes until they ruined the low country woollen industry. Once English manufacturing led the way, quality regulations were put in place to stop unscrupulous entrepreneurs setting up to make lower quality goods and out compete the established industry.

There was no free market about this. Although the state and government of England was different to what it is now, the first manufacturing in England was done with full state support both in the market and in nurturing the skills and technology over many years.

Years later just before and during the industrial revolution, Great Britain forced the colonies to be limited to supplying raw materials or base goods, pig iron from America and calico from India for example.

Britain was ruthless, especially under Walpole, in using military might, seapower, tax, embargoes, customs, direct state support, subsidies and all the rest to promote and protect British trade.

There's never been a free market.

The big daddy of the free market Adam Smith was an outspoken supporter of the 'Navigation Acts' These forced overseas exporters, of raw material, to Britain to use only British ships. If you didn't use a British built ship flying the British flag you didn't land your goods in Britain.

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