Two Hundred Years of Muddling Through: The Surprising Story of Britain’s Economy from Boom to Bust and Back Again

by Duncan Weldon

'Here's the history that really matters' Financial Times

The UK is, at the same time, both one of the world's most successful economies and one of Europe's laggards. The country contains some of Western Europe's richest areas such as the south east of England, but also some of its poorest such as the north east or Wales. It's really not much of an exaggeration to describe the UK, in economic terms, as 'Portugal but with Singapore in the bottom corner'. Looking into the past helps understand why.

Two Hundred Years of Muddling Through tells the story of how Britain's economy and politics have interacted with each other from the time of the Industrial Revolution right up to the pandemic of 2020. A few politicians, such as Peel, Gladstone, Attlee and Thatcher have managed to shape the economy but far more have been shaped by it. Depressing little in British economic debate is really new. This time is rarely, if ever, really different. The debates about the balance between economic openness and sovereignty that re-emerged after Brexit would have been familiar to Peel and Cobden in the 1840s. The size of the government's deficit has dominated politics since 2010 but fretting about the scale of the national debt was almost a national pastime during Victoria's reign. Worries about the failure of vocational training and a paranoia that German manufacturing was powering ahead were common in the days of Lloyd George and Asquith. Supposedly modern concerns about the impacts of new technology on jobs and inequality date back to at least Captain Swing and Ned Ludd. As the economy emerges from the Covid-19 recession and sets out on a new post-Brexit future an understanding of the past is vital to seeing how the future might play out.

Genres: Economics, History, Politics, Nonfiction, Business, British Literature, Society

339 pages, Paperback

Published January 1, 2022

Reviews

[Geevee · Rating 4 out of 5]

Duncan Weldon has written a very good book that in easy, accessible and clear prose provides a fascinating and informative canter through Britain's economic successes, failures and challenges.

These cover UK and world events such as the industrial revolution, global trade, empire, two world wars, Bretton Woods, the Gold Standard, The Great Depression, The Sick Man of Europe, Covid, EEC and then to EU (Maastricht Treaty), ERM. and Brexit. Within these Mr Weldon covers economic and fiscal policies and UK governments' approaches to investment, technology, regulation, spending, taxation, manufacturing, trade, surpluses and debts, tariffs as well as population, skills, education, unions and voters and voting.

All of this may sound rather dull and/or daunting, but actually it is a really fascinating, and indeed a well-told story that deftly explains terms and approaches, as well as giving good information on personalities and key players and how things ended up as they did or didn't to the surprise or expectation of politicians, businesses and citizens alike.

[Adam Clark · Rating 4 out of 5]

A readable economic history that acts like a tonic - it won't sweep you away but it stops you getting too drunk on big ideas that aren't good for you. Weldon shows how Britain's journey to being the most economically powerful country in the world and subsequent fall was conditioned by external factors such as how open the world was to trade, as well as the limitations of political economy - what were people willing to vote for. He explains economic terms well and keeps the jargon to the minimum necessary. The pre 20th century section is a stong narrative history while the more familiar modern history contains plenty of useful correctives - Attlee's government spent more on defence than on health. Thatcher didn't substantially cut taxes as proportion of GDP.

There's no Big Idea here. The suggestion that Britain is uniquely disposed to ´muddling through´ isn't really proven, beyond a theme of the Treasury view from as far back as William Gladstone limiting government's hand, mixed with a certain tradition of British labour politics which prized flexibility and individualism. Without a detailed comparison with other comparable countries, it's hard to test the theory. But this is an excellent book to keep on hand when for when other authors claim to have all the answers.

[Neil Bradford · Rating 3 out of 5]

Good overview, bit journalist-y. The chapters after WW2 felt a bit rushed and didn’t add too much — specifically didn’t link trends / patterns back to pre-war times. But very accessible.

I still can’t see how any book on economics can have NO CHARTS — crazy! I know charts cost more to lay out than text, but really??!!

[Caio Garzeri · Rating 4 out of 5]

Bom de ler, parece um artigo de wikipedia bem recheado (no que isso tem de bom), bem equilibrado entre narrar fatos e dar opinões. Muito boa introdução. Nenhuma tese maluca, bem normie, do jeito que a gente gosta.

https://www.blogger.com/blog/posts/60...

[Jonny · Rating 4 out of 5]

I enjoyed this - it’s exactly the sort of readable, concise narrative (interspersed with enough statistics to help assure you it’s rigorous and some good anecdotes) that you’d expect from a BBC and Economist journalist.

That said, it is very much a narrative - the earlier chapters until the 1930s set out more of an explanation of the drivers of relative economic performance in different periods, and do a better job articulating how the political economy shaped economic performance (and vice versa). From then on it becomes more of a quick whistle through post WWII history, with a weird lack of judgments attached (I can see that being the case for post-2010, but is there really no more that can be said around the impact of different reforms in the 70s and 80s)?

Overall it’s a good read - quick, and almost anyone reading it will learn something as they go. Like a lot of Economist pieces, you’re helped reading it if you ask “what’s missing?” As others have noted, in this case it’s definitely the role of the Empire which is dealt with briefly and then skipped past. At the very least it would have been good to establish the economics arguments as to why that is, rather than be left to assume it’s because it’s too complex to get into.

[Cool_guy · Rating 4 out of 5]

Yes, Duncan Weldon is a former editor at The Economist. Normally, such an esteemed title would earn his book a prime spot at the bottom of my trash can. Nonetheless, after hearing an interview with him on Patrick Wyman's podcast, Tides of History, I figured I'd give his book a shot. I'm glad I did.

Obviously, there's a good deal to to take issue with here. For example, in his explanation of the lead up to the industrial revolution, there's no mention of the enclosures or any of the other profound changes to English agriculture which made the rise of capitalism possible. And his treatment of the Empire is cursory and downright shameful.

So, why bother? Above all else, Weldon is an excellent writer. He has a brisk, lively style, and with it he brings to life a subject which is so often a dreary slog. In the process of providing an entertaining, if flawed, outline of the last two centuries of British economic history, Weldon clearly defines the terms that form the building blocks of the language that you're likely to find in the Wall Street Journal or the Financial Times.

Weldon has shown that you can write about economics in a simple, accessible style, without dumbing down the complexity of your ideas. Hadas Their has done something similar for Marxist theory with her People's Guide to Capitalism. I'd like to see more of it in the realm of history.

[Pete · Rating 4 out of 5]

Two Hundred Years of Muddling Through: The Surprising Story of Britain’s Economy from Boom to Bust and Back Again (2021) by Duncan Weldon is a very readable account of British economic history. Weldon was an advisor for the British Labour Party and is now The Economist’s British economics correspondent. Weldon writes in a readable casual style.

The book starts with a brief profile of British economic life prior to the Industrial Revolution. The economic rise of Europe, and in particular Britain is described. Weldon highlights the North European marriage pattern as helping countries get wealthier. He also writes about how prior to the Industrial Revolution Britain was already a highly commercial country. Britain had some of the most sophisticated capital markets in Europe.

The early 1800s was characterised by rapid growth and lots of recessions. Weldon points out that despite sketchy records there were 6 recessions from 1800 to 1850. Britain got wealthier, but not that much of the wealth flowed to many of the workers. This was what Marx and Engels were writing about at the time. However, from 1850 to 1900 average workers would become much wealthier. It’s also worth noting that Britain in the early 1800s was the richest country on earth. Weldon makes the point that the politicians of the time had little data and little understanding and had to improvise.

There are then chapters on Britain’s time as a wealthy country with a huge empire but that one that was in relative decline. As The United States, Germany, France and other countries also industrialised Britain’s proportion of global income shrank. Despite the relative decline Britons again continued to enjoy richer and richer lives.

The book has a fascinating chapter on World War One and how Britain handled it economically. The size of the British state grew dramatically. Taxes and the spending by government shot up and never returned to prewar levels. This was done in an ad hoc manner. The interwar period was a turbulent time for Britain and Weldon writes about how it didn’t experience a ‘roaring twenties’ due to war debts and the United States become economically more globally important. The great British economist John Maynard Keynes advised the government and also wrote some of his famous works.

World War Two and Britain’s economic response is also very interesting. The book points out that Britain’s economic production during the war was impressive. Weldon writes that in contrast to the First World War Britain was ready for the second and acted strongly from the start. The way that Britain paid for World War Two and bought from the US is also interesting. On top of all the planning and effort for the war the Beveridge Report was also written in 1942, outlining the future of the British welfare state.

Post War Britain would have a short period of Labour government that looked at continuing a huge role for the state in planning the economy. The NHS was founded. The Conservatives took power but continued much of what Labour had started. They did repeal some of the economic controls. Britain and Europe grew fantastically well in the post war period and became much richer. In Britain until the late 1960s economic conditions were really good.

The 1970s were a time of dynamic change in Britain. The Bretton-Woods agreement crumbled, there was an oil price shock, the trade unions went on strike and Britain appeared to be in serious trouble. Despite this real incomes rose strongly. The 1970s in Britain would close with the election of Margaret Thatcher.

Thatcher’s and Major’s changes to Britain would be dramatic. There was real deregulation, coal mining was ended, the unions were drastically weakened. Unemployment was also high for much of the time. But by 1997 Britain was better off. The reforms overall worked. The city rose in importance.

Labour’s election in 1997 led to 10 years of good economic times. The Labour Party worked carefully and with discipline to improve inequality and public services. However, the global financial crisis from 2007 showed that the system wasn’t working as well as hoped. This in turn led to new levels of improvisation and the invention of Quantitative Easing (QE). This was not planned as a response to an economic downturn but rather created on the fly.

The Conservatives’ return under David Cameron would promise to largely continue Labour’s policies but with a focus on balancing the budget. This was all thrown into chaos by the Brexit vote to leave the EU. Following the vote despite winning two election British economic policy suffered. This mess continued into the pandemic that further damaged the British economy.

Two Hundred Years of Muddling through does really well writing about the interplay between politics, ideas and the economy. Weldon writes about Keynes’s statement that politics and economics is all about ideas. But the book points out that politicians are repeatedly reacting to new situations that arise due to the interplay of changes in economics and politics. In turn there are new ideas from academics that change the situation that are then applied. This in turn leads to new problems and the cycle repeats. Everyone is, indeed, muddling through

[Andy Smith · Rating 5 out of 5]

Magnificent.

[Adam · Rating 5 out of 5]

Interesting canter through British economic policy since the Industrial Revolution. Surprisingly substantial for a book of barely 300 pages.

[Sam Duthie · Rating 3 out of 5]

Very interesting and easily readable

[Luciano · Rating 4 out of 5]

3,5 rounded up. Weldon does an outstanding job of condensing hundred years of history in a few hundred pages; it's fascinating to follow how this great nation went from the forefront of development to its fringes to a very uncertain future, through contingency and some rather random choices.

[Stephen · Rating 4 out of 5]

I really liked this book. It sets out the agenda at the start of the book and then delivers it in a 'no nonsense' way. The book looks at the past two hundred years of economic performance from Britain. How Britannia moved from being 'the workshop of the world' to becoming 'the sick man of Europe'. I found the book to be knowledgeable (because the author knows his stuff) and informative (because he keeps to the point). That has a lot to be said for it.

There were one or two places where I could feel my teeth grinding. For example, in describing the post-war trade off between inflation and unemployment, he describes the author of the Phillips Curve as Edward Phillips, whereas his name was actually Bill Phillips. These small details annoy me because they are facts that are easily and readily checked.

However, this is nit picking. The great achievement of the book is to lay out the manner in which the British economy became locked in a path dependent trajectory. Other nations could learn from the British mistakes, but Britain couldn't. It is good to see an element of political economy return to a discussion of the economy because the institutional framework is the result of political choices made along the way. When we have made decisions, they have not always been with the long term in mind.

The book is well written and generally well researched. It avoids being overly academic and the writing and style is quite accessible. The reader doesn't need a great deal of prior knowledge, but will need a sense of curiosity. As we look at out immediate future prospects, much of our choices are constrained by the choices of the past. It is helpful to understand these past choices because they contain the key to our future. The book makes a significant contribution to our understanding.

[Jakub Dovcik · Rating 5 out of 5]

This is an amazing book of economic history, drawing on the best mainstream works and explanations, written by a journalist, so it is engaging and easily understandable. The author further sprinkles it, especially in the earlier chapters, with bits of macroeconomic theory, so it should be comprehensible for most readers.

The book has a few themes throughout the narrative - the importance of path dependence, the benefits of specialisation at various points (like the decline of agriculture during the World Wars that allowed Britain to focus on manufacturing and financial support for the Allies) or the impact of political decisions on economic reality (like the allocation of costs in things like the Corn Laws, the influence of the growth of home ownership on interest rate decisions etc). All of these points should be more present in the public debate, not just in Britain.

The book confronts some of the common myths about the British economy - for instance about the grim 1970s, when in fact the unemployment was lower and real wage growth higher than during the 1990s and 2000s, or giving credit for price stabilisation in the 1980s to Thatcher’s “monetarism” and control of money supply rather than the strong pound (thanks partially to the ERM in latter years), weakening of the union power and consistently high unemployment. It also shows the various examples of terrible policy decisions, from the 1920s to the bad responses to supply-side shocks in the 1970s as well as the austerity programme under Chancellor Osborne.

I wish there were more books like this, that create not just a useful framework for thinking about history, but also for understanding choices in economic policy in our age. It shows the economy to be a result of both the decisions and external influences, but very much a living creature, that can be changed and developed.

[Francis Kennedy · Rating 4 out of 5]

This is an excellent primer on Britain’s economic history. It is readable, moderate and well balanced (most economic history writing has a political bias of one kind or another), corrects many myths and is both a fine EH101 type text but also contains pretty much everything any lay reader needs to know about the topic. Its messages, such as the historical path-dependency of the UK’s present economic condition, and of its future, are important too. Changes and details which might seem small, such as membership or non-membership of the European Union, have very big and lasting long-term impacts on the UK’s economy and performance. The importance of politics in economic history was also a convincing theme (although I did not need much convincing of it). The only slightly negative notes I would make: I wasn’t sure that the book and its conclusions lived up to the grand title. Yes, I fully agree about muddling through but to justify the epithet we needed to see more of the muddle in the narrative. Similarly with ‘surprising’ in the title. Finally, the grand conclusion - saying that Keynes was wrong when he said that ideas rather than vested interests have the greatest power for good or evil, and that political factors are the key driver - was weak and unconvincing, and unproven by what he had written before. Ideas and politics are not even separable concepts. Keynes was right about that. Ideas, including their political underpinnings, are crucial. They have the power to sway crowds, with both positive and negative effects, and can be used to that effect by small groups of determined people, as Elias Canetti described in Crowds and Power

[Rose · Rating 4 out of 5]

With Christmas coming up, a book about economics seemed like suitable seasonal reading... though, having read about some of the haphazard and downright reasonless decision making leaders have made, it's perhaps better suited to Halloween.

The book was surprisingly enjoyable given that economics is a notoriously dry subject, even managing to be funny in places and engaging throughout. Historical information and a focus on theory vs. reality made it easy to understand, and meant that case studies were naturally woven into the text.

There were flaws however. While it would be impossible to write a book that gave every possible element of context and angle available, there were sections of the book where the implication seemed to be that economic considerations were the only or leading factor in people's decisions, but knowledge (and in some cases, memory) of those events tells me there was a lot more going on than this narrative implied, and some small acknowledgement of that would probably have been helpful. Likewise, while the introduction and conclusion of the book made mention of 'path dependence' and suggested the aim was to establish the idea that all economic decisions made are born of the situation preceding them, there were examples of politicians making choices that seemed to diverge from previously accepted practice or historical examples and little explanation was given for this. A bit more analysis of these sudden shifts would have made the books central argument a bit more cohesive.

[Alexander Cockburn · Rating 4 out of 5]

This was a readable, enjoyable introduction to economic history. I never studied economics or history at school/university, but I follow the news fairly actively, and I found this book was pitched at the right level for me. The book gives a nice introduction to a few concepts that I had heard in passing but had never examined in much depth: current account/balance of payments, Keynesian economics, monetarism, bankers trilemma, etc. After reading this book I feel like I have a decent handle on these concepts, and I at least understand what the major arguments in economics are about.

While the book mostly feels like an engagingly-written history of one economic event after another, Weldon emphasises a few recurring themes one can take away from economic history. Some of these do definitely stand out in his history, like the importance of political and social context, and how constant economic debate has been over the years. Weldon also emphasises 'path dependency', which he says 'is perhaps best thought of as the idea that the route one took to arrive somewhere is just as important as the destination'. I had more trouble understanding what this means, and how his history bears this out. How could history be anything other than path-dependent? What would a non-path-dependent economy look like, even hypothetically?

This is a minor criticism though. If you're looking for an engaging introduction to economic history then I recommend this book.

[Ashley Amos · Rating 5 out of 5]

‘Muddling Through’ is a superb, detailed overview, charting 200 years of British economic history. For a nation immersed in the traditions of entrepreneurial innovation and ambitious start-up companies, it’s surprising how little space economic history seems to occupy in the minds of the general population. Surely all British school children should be given a more detailed idea of how the Capitalist engines of The City of London operate, considering their enormous influence on the economy. 2008 reminds us of how high are the stakes when the global financial system goes wrong. Surely such scandalous collapses would be less likely if the masters of the financial universe were held to account by an educated, informed population…

This text is essential reading for understanding the issues that have haunted the UK economy, such as poor relations between labour and capital. It raises the hot potatoes of Sterling’s devaluation in 1967; the IMF bailout of 1976 that was never fully used and paid back by 1979; not to mention Thatcher’s deregulatory Big Bang in The City, when Greed was considered good, and capital controls were abandoned. Finally, there’s Black Wednesday - dropping out of the ERM, which set the Conservative Party on a destructive course with Europe and eventually Brexit.

Definitely worth a long and considered read.

[Harry Anderson · Rating 4 out of 5]

A very good summary of the last 200 years of economic history, as the name would suggest…

The book shows how the Industrial Revolution essentially set the UK off on a path which has taken other countries in Europe the best part of c150 years to catch up with and how, more recently, the UK has struggled to work out what economic a coherent economic approach looks like (the Brexit debate is highlighted as typical of this incoherent approach).

A central theme to the book is how the role and shape of the state has changed and adapted over time - not often for purely ‘ideological’ reasons, but more in response to economic developments and challenges, as well as the need to cope with huge global events (WW1 and WW2 loom large).

All the major points and figures from the past 200 years are contextualised and explained - the Industrial Revolution, (the repeal of) the Corn Laws, the Attlee reforms and ‘new Jerusalem’, and the Thatcher response (and reversal?) to this.

The one down side is that it appears to end rather abruptly - covering the Brexit referendum and then a postscript on the pandemic - rather than any key lessons or wider observations which govt, economists, and policymakers should consider based off of the last 200 years. Overall, very good though.

[Aparna · Rating 3 out of 5]

An in-depth historical analysis of British economic policies. As someone who is totally new to the subject, this felt far too detailed and a lot of it went over my head. My eyes glazed over throughout many chunks of this book. However, for such a detailed book, the author mentioned the British Empire maybe twice, and given what a massive impact the Empire had on the British economy, I expected at least a chapter, or even half a chapter dedicated to it. I felt like large chunks of history (1990s to today) were also rushed.

This provided an interesting insight into how political decisions have shaped the economy, and why some things are the way they are today. I just wouldn't recommend this to newbies to economics like myself - I was after the general gist which this wasn't. Interesting to see other reviews describe this as concise - I thought the opposite.

[Tom · Rating 4 out of 5]

Everyone thinks their field merits more pages than is really necessary. This author does a good job of keeping things brief and understandable. Concepts such as quantitative easing and government deficits are explained very well with just a few paragraphs. It's clear why the FT had this book on their list.

Having said that this is a very conventional take on modern economics. For example, the author derides those who labelled Thatcher's government as neoliberal, and in the same sentence admits her tenure heralded a move towards market deference. That is precisely what neoliberalism is. After this, there is no further mention of the concept at all. Seek alternatives if your wish is to read literature that's more critical of modern monetary theory and the efficient market hypothesis.

Overall, a nice historical summary. I made a lot of notes for reference.

[Alasdair · Rating 4 out of 5]

This is an accessible overview of the last two hundred years of British economic policy-making. I have been looking for a book like this for some years and I was really pleased when I saw that Duncan Weldon was working on such a topic, as his laconic style goes some way towards making this often confusing narrative coherent.
Packed with useful statistics from the last two centuries, it ends in the middle of the Covid-19 pandemic with the UK beginning to emerge from the chaos of the successive lockdowns. The economic landscape of this brave new world will continue to occupy writers for years to come, and Weldon would be well placed to publish a follow up book, perhaps on the ten years after the crisis.

[Jack D · Rating 5 out of 5]

A great little book going through the economic history of the UK since the Industrial Revolution, covering the issues of each time and the ideas driving decision making of the politicians in power. Writing style was engaging and witty, and made the book far more readable than the subject matter would suggest.

As a former civil servant it was especially interesting to learn about how Treasury came to be the all-powerful department we know it to be today and some of the history of thought behind their ridiculous Treasury Brain. It was also nice to get a background on how long the structural issues behind our current housing shortage had been brewing, and how each of the different factors contributed to the ridiculous house price rises we've been seeing for the past 40 years.

[Alexander Titcomb · Rating 5 out of 5]

Impressive and highly readable run-through for anyone who wants to swot up on British political economy. Some of the factoids were fascinating (the Reformation added ~100 working days to the year by removing so many saint days), and the section leading up to WWII was particularly insightful.

The main takeaway is how much the direction of the economy is shaped by the changing shape and incentives of the electorate. Weldon leaves us with this: "A government reliant on the votes of retired households will take different decisions from one based on a coalition of workers" which couldn't be more on point.

[Edward Paulley · Rating 5 out of 5]

Excellent overview of British Economic and consequently political history. At points the book lacks depth, but that was not what the book promised. As a nation we look back fondly at the times of Great Global Britain especially in comparison to the incompetence and partisanship of contemporary politics. However, our governments have always been plagued by incompetence and political selfishness. Therefore it’s safe to say most things turn out okay irrelevant of the contemporary political drama.

[Ilia · Rating 4 out of 5]

Very good particularly for idiots like me who struggle to get their heads around economics. Wheldon's narrative loses the thematic thread a little bit. The idea that introduces the book is 'path dependency' – prior decisions binding the hands of decisionmakers, and it could have been brought out a bit more in the subsequent story Wheldon tells. This is nonetheless a very clear, readable and wide-ranging history and leaves you better informed about the challenges facing Britain's economy.

[Andrew Wishart · Rating 4 out of 5]

A lot of the received wisdom in UK economic history in a nice concise and readable format. I felt the writing improved as the chapters came up to date with more of a narrative and less lists of figures. But I find more recent economic history most interesting so maybe that's just me.

Best bit has to be the theme of political economy. Makes a lot of sense.

A few typos which broke up my flow reading occasionally, but quite obvious what they were supposed to be.

[Matthew · Rating 5 out of 5]

Very well written and fluent, with a good pace across time. The author does an excellent job of communicating some dry ideas on path dependency, political economy and the gold standard, and how they have formed the modern UK. There are some very interesting snippets on parts of British economic history that may surprise even well informed readers. Finally, the authors opinions are nuanced and balanced and driven by analysis rather than prior balance - very good all round.

[Nick Humfrey · Rating 4 out of 5]

An extremely readable potted history of political decision making which gives you a real sense of the various travails of those having to steer economic decision making. I was expecting a bit more given the focus in the intro on path dependence on the institutions (BoE, HMT) that have tried to steer it. But I feel much better informed about what happened and what dictates economic policy

[Harry · Rating 5 out of 5]

Excellent book which makes the swings and roundabouts of the British economy manageable. Doesn’t give much in terms of economic theory so simplifies some ideas but there’s nothing stopping you/me doing our own reading about those.

[Greg · Rating 3 out of 5]

(Audiobook) Good clip through British economic history, busting some myths and putting political turmoil in its broader context. Recommend if you want to understand what shapes the debates we have today