SPECIAL SERIES: The secret origins of WW I – part 24 – : The First Priorities (1) One Law For The Rich

The onslaught of justification for war made it increasingly difficult for members of parliament to voice dissent in the House of Commons. Yet again, they fell victim to years of Secret Elite preparations, devised through the Committee of Imperial Defence, to take control and manipulate legislation to their own advantage immediately war was declared.
 

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Editor’s note:
to read all the previous posts of this series got to page “First World War”

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by Gerry Docherty and Jim Macgregor

published here in cooperation with the authors
first published on their blog 5 Aug 2014

The onslaught of justification for war made it increasingly difficult for members of parliament to voice dissent in the House of Commons. Yet again, they fell victim to years of Secret Elite preparations, devised through the Committee of Imperial Defence, to take control and manipulate legislation to their own advantage immediately war was declared. A raft of emergency legislation was rushed through Parliament, literally on the instant approval of both Houses, with no consideration given to discussion or dissent. As an example of how to curb a nation’s freedom without objection, 5 August 1914 stands testament to how democracy can be turned against itself in the name of ‘protecting the realm’. An unprecedented wave of spy-mania was fanned by the introduction of the Aliens Restriction Act which had been pre-drafted by the Committee of Imperial Defence in readiness for war. [1]

Home Secretary, Reginald McKenna announced in the Commons that, ‘Within the last twenty-four hours no fewer than twenty-one spies, or suspected spies, have been arrested in various places all over the country, chiefly in important military or naval centres, some of them long known to the authorities to be spies.’ [2] Rumours and spy stories were taken very seriously, and served to remind the public how important it was to curb ‘freedoms’. The government took carte blanche power to impose restrictions on those not born in Britain, though, as was explained in the House of Lords, the arrangements were fine-tuned to cause as little inconvenience to alien friends, while securing effective and, if necessary, severe control over alien enemies. [3] Alien friends and alien enemies, it sounded like H G Well’s War of the Worlds.

This was followed three days later, by the Defence of the Realm Act, which, though originally a brief bill of around 400 words, was amended and extended six times over the course of the war to give the government powers close to those enjoyed by a military court martial. [4] Ostensibly it purported to prevent spying or any action that put in jeopardy, the safety of railways docks and harbours. [5] It too was passed in minutes without discussion, and grew with each amendment to encompass a vast range of restrictions on freedoms.

At the same time, in the House of Lords, the vital interests of the Secret Elite were being presented by Lord Crewe, a man close to their inner circle, as if they were acts of noble benevolence. He announced that ‘during the last few days, the Government have been conferring at great length with the most important representatives of finance and commerce, including bankers, bill-brokers, the Stock Exchange, discount houses and with virtually every one of the great industries – textile, iron, docks and the rest [he could not for some reason bring himself to say armaments] …in the interests of the country at large’. [6] He added that it would be ‘business as usual’, and that money would be forthcoming to meet the ‘ordinary needs and concerns of life.’ Lord Crewe failed to mention that such preparations had been fully discussed at secret sub-committee meetings of the Committee of Imperial Defence since early 1912.

The dislocation to trade, industry, commerce and finance brought about by war, any war, offers an opportunity to those privileged with sufficient forewarning to make indecent profits. The disruption to banking, insurance and the process of trading through bills of exchange and clearing houses could also be severe, and a panic in the stock market or rumour that a particular bank would suffer huge losses, made the early days of war particularly susceptible to a collapse in confidence. The Secret Elite had overwhelming control of the financial sector and had been working for years to ensure that their interests were safeguarded when war was declared. Detailed advice and recommendations had been gathered by the Committee of Imperial Defence in 1911-12 to ensure that the government was ready to protect the money markets in the City of London [7] which was the inner sanctum of British banking and housed the registered offices of many Secret Elite associates.

Banks were kept shut by the convenient mechanism of extending the August Bank Holiday in 1914, so that a run on their assets could be avoided. Lord Crewe urged the ordinary citizen to keep his head and avoid panic, promising that there was no reason why any person, rich or poor, should be alarmed by the ‘momentary difficulty’ of war. [8] As far as protection of the nation was concerned, the banks came first. Lloyd George, once the champion of the people, proudly entitled one of the early chapters in his War Memoirs, ‘How We Saved The City [9] Ponder that fact for a moment. Yes, the government took great powers to itself in the name of the people, but it was the banks and the bankers who benefitted from the earliest acts of Asquith’s government at war.

Given that the business of the City was dependent on the smooth running of credit, the punctual payment of foreign debtors and bills of exchange, the sudden paralysis of the mechanisms for foreign exchange threatened a default which would have brought the banks to their knees. The solution, one very similar to the Federal Reserve System that had been adopted on America, was to announce a moratorium during which the banking, industrial and commercial interests persuaded the British government to ‘temporarily assume’ the liability for over a hundred million pounds worth of bills.In other words, to save the banking system which feared a financial crash, banks were given special protection by acting as agents for the government. Profits were not interfered with, but the government would pick up the bill for any losses, and the ordinary citizen would have to pay for it through taxation. [10] Government provision like old age pensions, insurance and other liabilities continued to be paid as before, but incredibly, housing rents were omitted from the moratorium. [11] The high-flying bankers and industrialists, the investors and the finance houses were instantly cushioned from loss while the working man and women who would have to pay for this had no automatic protection from future rent abuse. It was a charter for racketeers.

The Secret Elite knew better than any politician how to protect the wheels of commerce, and it was they, through the Bank of England and the Chancellor of the Exchequer, David Lloyd George, who ensured that the supply of ‘notes sufficient to meet the currency requirement’ was met by introducing £1 notes and 10 shilling notes for the first time. A Currency and Bank Notes Act was followed by the suspension of the Bank Act to allow previous restrictions on banks to be ‘temporarily’ removed [12] The gold standard of old was effectively amended, and the power to print money was unleashed to the Banks.

With a craft that was even by that time a signature mark of the Secret Elite, the Conservative Lord Lansdowne congratulated Asquith’s government on these decisions by acknowledging that the proposals, ‘have been the result of a careful consultation with the representatives of the financial, commercial, and industrial interests of this country. There can be no doubt that the Government did well … to satisfy themselves that they were in possession of the best advice which they could procure from the highest authorities in this country, and that they could count upon the support of those authorities’ [13]

And where did the best advice come from? Those who would benefit most. Lansdowne repeated the old trick of responding positively to the government’s proposals and thereby cutting down any negative reaction. He endorsed the plans of his own associates and guaranteed a united approval from both major political parties. Every action sanctioned by the government that day reeked of the self interest of the Secret Elite. They knew how wars depended on money, its supply and availability, and how important it was to be well prepared for reaping the profits of war.

Despite their every advantage, hoarding was another problem which was caused by the rich. Lloyd George spoke out against the hoarding of gold as early as 5 August, berating the ‘selfish motives of greed…or cowardice’ which was, in his eyes, comparable to assisting the enemies of his native land. Barely three days later, Mr Runciman, President of the Board of Trade, was forced to introduce a bill to stop the unreasonable hoarding of foodstuffs. Faced by evidence from many parts of the country that the greed of ‘better-to-do’ people was causing great hardship to the poorer classes, the government was forced to take prompt action to limit such outrageous misbehaviour. Runciman denounced the panic and greed of the richer community ‘who have really disgraced themselves by placing long queues of motor cars outside the stores and carrying off as much provisions as they could persuade stores to part with’. [14] What an unhappy image. The hungry poor frightened by food-price rises would suffer shortages while the rich sent their servants to buy up as much produce as could be obtained.

So much for the spirit of togetherness.

 
[1] Christopher Andrew, Secret Service, p. 181.
[2] House of Commons Debate 05 August 1914 vol 65 cc1986
[3] House of Lords Debate 05 August 1914 vol 17 cc384-5384.
[4] Christopher Andrew, Secret Service, p. 181
[5] HC Deb 07 August 1914 vol. 65 cc2191-3
[6] HL Deb 05 August 1914, vol. 17 cc374-84
[7] PRO CAB 16/18A p.93
[8] HL Deb 05 August 1914, vol. 17 cc374-84
[9] David Lloyd George, War Memoirs, p. 61.
[10] Ibid.
[11] David Lloyd George, HC Deb 5 August, 1914 vol.65 cc1991-2000.
[12] HC Deb 06 August 1914 vol. 65 cc2101-7
[13] HL Deb 05 August 1914, vol. 17 cc374-84 [14] HC Deb 08 August 1914, vol. 65 cc2212-22

The book is available at leading bookshops and can also be purchased on the internet at Amazon, Alibris, etc.

About the authors:
Gerry Docherty was born in 1948. He graduated from Edinburgh University in 1971 and was a secondary school teacher by profession. He taught economics and modern studies, developed a keen interest in the theatre and has written a number of plays with a historical theme including Czechmate in 1982, Montrose in 1993, and Lie of the Land in 2008. The last of these plays was the powerful story of two cousins from his home town of Tillicoultry who were both awarded the Victoria Cross at the Battle of Loos in 1915. Energised by the research he had undertaken to write this play, he was intrigued by Jim Macgregor’s work on the First World War, and their mutual interest developed into a passion to discover the truth amongst the lies and deceptions that the official records contained.
Jim Macgregor was born in Glasgow in 1947 and raised in a cottage in the grounds of Erskine Hospital for war disabled. He witnessed there the aftermath of war on a daily basis and, profoundly affected by what he saw, developed a life-long interest in war and the origins of global conflict. Leaving school at fifteen he worked in jobs as diverse as farm labourer, animal husbandry and medical research before graduating as a medical doctor in 1978. Jim left medical practice in 2001 to devote his energies full-time to researching the political failures in averting war. His numerous articles have been published on subjects such as miscarriages of justice, the Iraq War, global poverty, and the rise of fascism in the United States. His powerful anti-war novel The Iboga Visions was published to critical acclaim in 2009.

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