That the Attlee government faced severe economic constraints in the pursuit of its policies is well known and those constraints have been explored in detail in this book. The wearing out and destruction of capital during the war, the extraordinarily high degree of war mobilisation, the sale of foreign assets and the retreat from overseas markets during the conflict left an economic situation worse than any government has had to deal with in modern times. Economic recovery, above all the rebuilding of the international accounts and the expansion of exports and investment deemed necessary to secure this end, dominated the economic agenda. In the name of economic recovery other aims – colonial development, gender equality most obviously – were substantially compromised, and whilst the welfare state was established, by the end of the 1940s its improvement was subject to severe scrutiny in the belief that there existed a conflict between welfare and further economic expansion.

Economic policy is never without a political context, and economic policy objectives are usually best seen in the light of the political strategy they support. This point has already been made in the discussion of the balance of payments, where it is clear that this problem was dominated by the political desire to rebuild the British capacity to play its role as a major military and diplomatic power in the world, underpinned by capital exports and the maintenance of the sterling area.