Economics and Foreign Policy, 1942-1957
This book explains how and why, Australian governments shifted from their historical relationship with Britain to the beginning of a primary reliance on the United States between 1942 and 1957. It shows that, while the Curtin and Chifley ALP governments sought to maintain and strengthen Australia’s links with Britain, the Menzies administration took decisive steps towards this realignment.
There is broad acceptance that the end of British Australia only occurred in the 1960s and that the initiative for change came from Britain rather than Australia. This book rejects this consensus, which fundamentally rests on the idea of Australia remaining part of a British World until the UK attempts to join the European Community in the 1960s. Instead, it demonstrates that critical steps ending British Australia occurred in the 1950s and were initiated by Australia. These Australian actions were especially pronounced in the economic sphere, which has been largely overlooked in the current consensus. Australia’s understanding of its national self-interest outweighed its sense of Britishness.
Introduction – The Anzac Dilemma
“Some inadequately observed consequences of the decline of British power, with special reference to the Pacific area.”1
In the early 1950s, the historian Frederick Wood explained the choices forced upon Australia and New Zealand by British decline. Previously, he said, “we took for granted the naval and economic strength of Great Britain, and on that twofold foundation we built free and prosperous countries.” But this British preeminence no longer existed; America was the dominant military and economic power. Britain’s decline led to what he called the “Anzac dilemma.” Australia could be forced to choose between the British Commonwealth and the United States. The dilemma was masked when Britain and America stood together but, if they seriously diverged, “the results for the Pacific Dominions would be calamitous.”2
While Wood’s primary focus was on New Zealand, this book explores how Australia attempted to resolve the dilemma from 1942 to 1957. It finds that, contrary to the current historical consensus and public political statements at the time, which emphasise ongoing attachment to Britain, in the 1950s, Australia demonstrated an increasing tendency to follow America. This choice was clear to many contemporaries. The Adelaide News, soon after Rupert Murdoch assumed control, summarised the “dilemma” in 1954. A front-page editorial asked “the 64-dollar question … Is Canberra more concerned with keeping in step with Washington than with her traditional ties with Britain?” An accompanying cartoon illustrated the dilemma. Should Richard Casey, Australia’s Minister for...
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