The Empire Project_ The Rise And Fall Of The British World-System, 1830-1970 Part 8

The terms and timing of 'convertibility' became the central issue in economic policy. Within the Bank of England and the Treasury, there were those who were eager to get it done quickly, arguing that sterling's prospects would not improve with delay. The sterling crisis that broke over their heads at the end of 1951 pushed them into a radical plan. Under the acronym 'ROBOT', it proposed to make sterling convertible subject to two drastic conditions. First, it would be necessary to persuade those countries with large sterling balances that the bulk of them should be frozen, leaving only the amounts they needed for normal trading purposes. This was the quid pro quo quid pro quo for the end of exchange control. Secondly (and much more controversially), the plan proposed that sterling should 'float' (just as it had in the 1930s). The reason for this was that defending a fixed rate (sterling had been fixed at $2.80 to 1 in 1949) might quickly consume much of Britain's reserve of dollars and gold (just as it had in 1947) and wreck the experiment almost before it had started. Allowing sterling to find its own level in the period of sharp adjustment that would follow free exchange would also reduce the risk of British exports becoming uncompet.i.tive with the end of import controls and dollar restriction in sterling area markets. for the end of exchange control. Secondly (and much more controversially), the plan proposed that sterling should 'float' (just as it had in the 1930s). The reason for this was that defending a fixed rate (sterling had been fixed at $2.80 to 1 in 1949) might quickly consume much of Britain's reserve of dollars and gold (just as it had in 1947) and wreck the experiment almost before it had started. Allowing sterling to find its own level in the period of sharp adjustment that would follow free exchange would also reduce the risk of British exports becoming uncompet.i.tive with the end of import controls and dollar restriction in sterling area markets.41 With the support of the Bank of England and his own expert advisers, the Chancellor of the Exchequer, R. A. Butler, presented ROBOT to his colleagues as the best solution to the financial crisis that the new Churchill government had inherited. The sequel was instructive. With the support of the Bank of England and his own expert advisers, the Chancellor of the Exchequer, R. A. Butler, presented ROBOT to his colleagues as the best solution to the financial crisis that the new Churchill government had inherited. The sequel was instructive.

For all its heavyweight backing, ROBOT soon attracted fierce opposition, not least from Lord Cherwell, Churchill's scientific adviser, known colloquially as the 'Prime Minister's Adder'. Cherwell was scornful of the flimsy statistical basis on which ROBOT was built, and argued persuasively that the pressure on sterling could be relieved by the use of much less drastic measures. It was, he said, 'a reckless leap in the dark involving appalling political and economic risks at home and abroad'.42 The objection to ROBOT was not just that Butler's medicine was unnecessarily strong. Four arguments sank it. First, although there had been ambiguous signals from across the Atlantic, floating the pound would breach the first commandment of the Bretton Woods doctrine. It was hard to believe that the American response would not be severe. Secondly, it was far from certain that all the other countries in the sterling area would adopt a floating exchange rate. Far from forming a bloc of like-minded states, the sterling countries might break up in anger and acrimony. Thirdly, floating the pound might lead to the break-up of the European Payments Union (a currency pool along sterling area lines) if the pound was devalued against some European currencies. At a time when London was also trying to promote defence cooperation among the Western European states, and soothing French fears of future German aggrandis.e.m.e.nt, such a large spanner in the European works was unwelcome at best. The Foreign Office and Foreign Secretary were among ROBOT's fiercest critics. The objection to ROBOT was not just that Butler's medicine was unnecessarily strong. Four arguments sank it. First, although there had been ambiguous signals from across the Atlantic, floating the pound would breach the first commandment of the Bretton Woods doctrine. It was hard to believe that the American response would not be severe. Secondly, it was far from certain that all the other countries in the sterling area would adopt a floating exchange rate. Far from forming a bloc of like-minded states, the sterling countries might break up in anger and acrimony. Thirdly, floating the pound might lead to the break-up of the European Payments Union (a currency pool along sterling area lines) if the pound was devalued against some European currencies. At a time when London was also trying to promote defence cooperation among the Western European states, and soothing French fears of future German aggrandis.e.m.e.nt, such a large spanner in the European works was unwelcome at best. The Foreign Office and Foreign Secretary were among ROBOT's fiercest critics.43 Finally, since it was hard to predict how far sterling's value would fall under the ROBOT regime, it was hard to deny that, at least in the short run, the domestic effects might be very unsettling: rapid inflation if imports cost more; severe unemployment if other countries retaliated against a devaluing pound. Finally, since it was hard to predict how far sterling's value would fall under the ROBOT regime, it was hard to deny that, at least in the short run, the domestic effects might be very unsettling: rapid inflation if imports cost more; severe unemployment if other countries retaliated against a devaluing pound.

ROBOT was opposed by those who thought Britain's position too fragile to survive the shock treatment it promised and by those (like Cherwell) who argued that sticking to 'the long steady task of building up our reserves' was the best recipe for success. That it would be a long haul seemed amply confirmed in the next few years. In 1955, after two better years, inflationary pressure in the British economy and a sharp negative movement in the balance of payments led to credit restrictions to dampen home demand and strengthen sterling abroad. The following year was the year of Suez. The British invasion of Egypt triggered a flight from the pound; the cost of supporting its value from a fast dwindling reserve of dollars and gold was the critical factor in forcing the British withdrawal. In 1957, inflation in Britain and the devaluation of the French franc reopened doubts over whether sterling could hold its fixed dollar value. It took a fierce contraction of credit (the Bank rate rose to 7 per cent, its highest level since 1921) and an American loan to beat off the threat. It seems somewhat surprising after this ragged performance that the Macmillan government quietly made sterling convertible over the Christmas break in 1958. It was certainly true that the balance of trade had improved and inflation was down. But it was also true that its hand was being forced. Strict exchange control had already collapsed: it was the buying and selling of sterling in the market of currencies that now determined its value. Secondly, France had pre-empted the British in making the franc convertible (while devaluing again). At the moment when London was straining to persuade the new European Economic Community to include Britain in a 'free trade agreement', the pound had to look the franc demi-fort franc demi-fort in the eye. But had the reserves that were needed to defend sterling's value been salted away? The Treasury's target for a payments surplus had still not been reached. Instead, reliance was now placed on being able to borrow from the International Monetary Fund if the going got hard. in the eye. But had the reserves that were needed to defend sterling's value been salted away? The Treasury's target for a payments surplus had still not been reached. Instead, reliance was now placed on being able to borrow from the International Monetary Fund if the going got hard.44 Convertibility, remarked Convertibility, remarked The Economist The Economist in a phrase that ought to have struck a ministerial chill, was an 'act of bravery'. in a phrase that ought to have struck a ministerial chill, was an 'act of bravery'.45 British leaders knew of course that convertibility was not enough. To be an economic great power required a central position in the flows of world trade, and reasonable access to some of the world's richest markets. Before 1914, over one-third of British trade had been with Europe, and nearly one-quarter with the countries that became the European Economic Community (the 'EEC Six') in 1958. In the inter-war years, the share of British exports sent to the future 'EEC Six' fell to under 15%. After the Second World War, it fell even further, to less than 10% in 1948.46 But, by the 1950s, these were the countries that were growing most rapidly. More generally, it was industrial countries that made the best markets. Here, too, Britain lagged behind its main compet.i.tors. Its princ.i.p.al rivals increased the share of their exports to other industrial countries from 58% in 19502 to 61% in 19579. The British share rose from 39% to 45%. But, by the 1950s, these were the countries that were growing most rapidly. More generally, it was industrial countries that made the best markets. Here, too, Britain lagged behind its main compet.i.tors. Its princ.i.p.al rivals increased the share of their exports to other industrial countries from 58% in 19502 to 61% in 19579. The British share rose from 39% to 45%.47 To keep up the momentum that had doubled British exports from their pre-war levels required a major effort in Europe. To keep up the momentum that had doubled British exports from their pre-war levels required a major effort in Europe.

For this reason alone, London kept a wary eye on the progress of European schemes for economic and political unity that were gathering pace in the early 1950s. Its negative att.i.tude towards the plans that emerged for an Economic Community from the Messina Conference in 1955 has been much derided in hindsight. In fact, the British regarded the idea of forming an inner group (with discriminatory tariffs) within the larger collectivity of Western European states with considerable hostility. They thought it would damage the prospects for freer trade in general and for British trade in particular. They wanted it to fail, and thought that it would.48 They saw no point in lending it any support. But this was far from an att.i.tude of indifference or hostility towards closer cooperation with Europe, although there were plenty of those in the Conservative party who took a 'blue water' view of continental commitments. Instead, in the late summer of 1956, the Cabinet agreed on a plan that was intended deliberately to seize control of the movement towards a European customs union and drive it in the direction that British policy favoured. This was 'Plan G', which proposed to sink the EEC project within a larger 'Free Trade Area' within which there would be free trade in manufactured goods but no common agricultural policy. The obvious merit from a British point of view was that this would allow continued preferential arrangements both for British farmers (heavily protected since the Second World War) and for Commonwealth producers. It would give Britain the benefits of a large open European market with few of the drawbacks of being tied to an economic bloc. They saw no point in lending it any support. But this was far from an att.i.tude of indifference or hostility towards closer cooperation with Europe, although there were plenty of those in the Conservative party who took a 'blue water' view of continental commitments. Instead, in the late summer of 1956, the Cabinet agreed on a plan that was intended deliberately to seize control of the movement towards a European customs union and drive it in the direction that British policy favoured. This was 'Plan G', which proposed to sink the EEC project within a larger 'Free Trade Area' within which there would be free trade in manufactured goods but no common agricultural policy. The obvious merit from a British point of view was that this would allow continued preferential arrangements both for British farmers (heavily protected since the Second World War) and for Commonwealth producers. It would give Britain the benefits of a large open European market with few of the drawbacks of being tied to an economic bloc.

The plan was put to the Cabinet by Harold Macmillan, then Chancellor of the Exchequer, as a series of rhetorical questions, designed to flush out its fiercest opponents. 'Is this a good plan for the British economy?', asked the Chancellor, Will it bring us strength in the long run...? Can the British economy survive alone, insulated and protected from European compet.i.tion? Will it be able to maintain its exports to Europe...? Equally important, can it maintain its exports to other countries against the compet.i.tion of European countries, either individually, as now, or in a unified Europe largely under German domination? Can we enter into a new structure and at the same time maintain the advantages of the Commonwealth, our preferences and all the rest? Can we retain them even if we keep out? Will it bring us strength in the long run...? Can the British economy survive alone, insulated and protected from European compet.i.tion? Will it be able to maintain its exports to Europe...? Equally important, can it maintain its exports to other countries against the compet.i.tion of European countries, either individually, as now, or in a unified Europe largely under German domination? Can we enter into a new structure and at the same time maintain the advantages of the Commonwealth, our preferences and all the rest? Can we retain them even if we keep out?49 Nor, of course, were the issues at stake of solely economic concern. Were the aims of Plan G 'politically sound'? 'Can we retain the leadership of the Commonwealth world and at the same time seize the leadership of Europe? Would it help us to create a new period of British strength and power, or should we be foolishly throwing away what we have? Would it bring us promise for the future, or is it an abdication and betrayal of our past? and at the same time seize the leadership of Europe? Would it help us to create a new period of British strength and power, or should we be foolishly throwing away what we have? Would it bring us promise for the future, or is it an abdication and betrayal of our past?50 Macmillan also spelled out the risk of division within the Conservative party, the threat posed by free trade to maintaining full employment and the need to rea.s.sure both Commonwealth countries and the United States. But there was no doubt that he wanted his colleagues' approval for a plan which among other things, was intended to make London the centre for Europe's foreign investment. 'The economic unification of much of Western Europe', declared Peter Thorneycroft, President of the Board of Trade, 'would create a new source of investment capital for overseas development which might be expected to flow out to Commonwealth countries through London under our management'.51 In the discussion that followed, there were predictable fears that the main Commonwealth countries would turn away from Britain towards the United States and 'the status of Britain as a world power depends on her position as head of the Commonwealth'. In the discussion that followed, there were predictable fears that the main Commonwealth countries would turn away from Britain towards the United States and 'the status of Britain as a world power depends on her position as head of the Commonwealth'.52 But Macmillan insisted that, without a new basis for the British economy, it could not provide the market that the Commonwealth needed, nor secure the future of sterling. When Eden summed up, his view was decisive. There was little hope, he said, of an economic policy based on the Commonwealth: even Australia and New Zealand seemed to be turning towards the United States. The Asian Commonwealth could not be relied on. 'Unless we were capable, acting alone, of meeting formidable European compet.i.tion in oversea markets, there seemed no alternative but to base our policy on the proposed plan for closer a.s.sociation with Europe'. But Macmillan insisted that, without a new basis for the British economy, it could not provide the market that the Commonwealth needed, nor secure the future of sterling. When Eden summed up, his view was decisive. There was little hope, he said, of an economic policy based on the Commonwealth: even Australia and New Zealand seemed to be turning towards the United States. The Asian Commonwealth could not be relied on. 'Unless we were capable, acting alone, of meeting formidable European compet.i.tion in oversea markets, there seemed no alternative but to base our policy on the proposed plan for closer a.s.sociation with Europe'.53 After further consultations, and some positive signals from the United States, Europe, the Commonwealth and domestic opinion, the decision was made in early November to press ahead and negotiate. After further consultations, and some positive signals from the United States, Europe, the Commonwealth and domestic opinion, the decision was made in early November to press ahead and negotiate.

But, as it turned out, the British had badly mistaken the strength of their hand. They had coolly a.s.sumed that, if they took a firm line on the exclusion of foodstuffs from the free trade arrangements, they would get their way: 'We should expect this condition to be ultimately accepted', said Macmillan and Thorneycroft.54 They also a.s.sumed that, once they had given a lead, the idea of a free trade area would trump the plan for an economic community drawn up by the Six. One key to their thinking was the belief that France shared Britain's fear of a 'German-dominated' Europe, to which Macmillan had referred, but felt it even more deeply. French paranoia would give the British the lever they needed to switch the points towards the free trade line, or derail the train. All this proved wrong. The European Six signed the Treaty of Rome in March 1957. When the British began to negotiate in October that year, they met a stubborn refusal on the foodstuffs question. And, far from France proving the weak link in the EEC chain, the reverse was the case. In June 1958, General De Gaulle returned to power, first as prime minister in the dying Fourth Republic, then as president in the Fifth. It was De Gaulle who firmly put an end to the free trade area diplomacy. It was an unmistakable omen. All the British could hope (with some justification from history) was that his tenure would be short and his retirement long. They also a.s.sumed that, once they had given a lead, the idea of a free trade area would trump the plan for an economic community drawn up by the Six. One key to their thinking was the belief that France shared Britain's fear of a 'German-dominated' Europe, to which Macmillan had referred, but felt it even more deeply. French paranoia would give the British the lever they needed to switch the points towards the free trade line, or derail the train. All this proved wrong. The European Six signed the Treaty of Rome in March 1957. When the British began to negotiate in October that year, they met a stubborn refusal on the foodstuffs question. And, far from France proving the weak link in the EEC chain, the reverse was the case. In June 1958, General De Gaulle returned to power, first as prime minister in the dying Fourth Republic, then as president in the Fifth. It was De Gaulle who firmly put an end to the free trade area diplomacy. It was an unmistakable omen. All the British could hope (with some justification from history) was that his tenure would be short and his retirement long.

It was a major defeat. London tried to make the best of things. The British had already committed themselves (at the Montreal Commonwealth Economic Conference) to stand by the system of Commonwealth preference and to make up the shortfall of private investment in their colonial and ex-colonial territories through government aid and loans.55 All this was intended to hold the Commonwealth together as a system of trade and influence and provide rea.s.surance of British aims and intentions. But it was starkly clear as the decade came to an end that what mattered most was the export compet.i.tiveness of the British economy. The 1959 Radcliffe Report on the British monetary system gave a ringing endors.e.m.e.nt of 'the general harmony of interest between the United Kingdom economy and that of the rest of the sterling area', All this was intended to hold the Commonwealth together as a system of trade and influence and provide rea.s.surance of British aims and intentions. But it was starkly clear as the decade came to an end that what mattered most was the export compet.i.tiveness of the British economy. The 1959 Radcliffe Report on the British monetary system gave a ringing endors.e.m.e.nt of 'the general harmony of interest between the United Kingdom economy and that of the rest of the sterling area',56 and insisted that it was in Britain's interest to invest more and more in the economic development of the Commonwealth countries. and insisted that it was in Britain's interest to invest more and more in the economic development of the Commonwealth countries.57 But it also warned that sterling's role as a reserve currency had been displaced by the dollar, and that the UK's reserves still formed only a fraction of sterling's liabilities. The only solution, as Cherwell had argued some seven years earlier, was to press on in the hope that export growth would build up the margin of safety to protect the domestic economy, make sterling secure and fund the export of capital to non-industrial countries. But it also warned that sterling's role as a reserve currency had been displaced by the dollar, and that the UK's reserves still formed only a fraction of sterling's liabilities. The only solution, as Cherwell had argued some seven years earlier, was to press on in the hope that export growth would build up the margin of safety to protect the domestic economy, make sterling secure and fund the export of capital to non-industrial countries.

But, on this battlefront, there were very mixed signals. The British economy had not performed badly. It had paid for a notable increase in living standards at home the 'affluence' for which the Conservative government was keen to take credit. But it had not performed well enough to allow Britain to become (or remain) an economic great power. There were several reasons for this. It may have been partly the fault of an old or obsolete infrastructure whose renewal was too costly under post-war conditions. This was the burden of being an 'old' industrial power. A more immediate difficulty was the need to transform an industrial structure largely adapted to the highly diversified markets in non-industrial countries that had been Britain's main customers since the inter-war years and before. The move towards a production system based on higher volume and standardisation was technically difficult and very disruptive in labour relations.58 As a result, the great shift from textiles to engineering as Britain's industrial staple was made too slowly. As a result, the great shift from textiles to engineering as Britain's industrial staple was made too slowly.59 Thirdly, British leaders shrank from the challenge to domestic opinion. In theory at least, they might have hoped to improve Britain's export performance and suppressed the inflationary trend that helped make sterling so fragile by enforcing a 'flexible' market in labour. An attack on restrictive practices, and the willingness to risk a short-term rise in unemployment, might have forced down real wages and secured productivity gains. Politically, there was no question of this. Full employment was part of the post-war compact: it was widely a.s.sumed that electoral suicide would follow its breach. Thus the sterling economy followed a zigzag path dictated by the aspiration to great-power status, the fear of abandoning its traditional base in the 'Commonwealth world', and mortal terror of an electorate enraged by an attack on job security and hard-won affluence. It would have needed an exceptionally benign outside world for this course to have brought British leaders the results that they craved. Thirdly, British leaders shrank from the challenge to domestic opinion. In theory at least, they might have hoped to improve Britain's export performance and suppressed the inflationary trend that helped make sterling so fragile by enforcing a 'flexible' market in labour. An attack on restrictive practices, and the willingness to risk a short-term rise in unemployment, might have forced down real wages and secured productivity gains. Politically, there was no question of this. Full employment was part of the post-war compact: it was widely a.s.sumed that electoral suicide would follow its breach. Thus the sterling economy followed a zigzag path dictated by the aspiration to great-power status, the fear of abandoning its traditional base in the 'Commonwealth world', and mortal terror of an electorate enraged by an attack on job security and hard-won affluence. It would have needed an exceptionally benign outside world for this course to have brought British leaders the results that they craved.

Descent to Suez As we saw in the last chapter, almost un.o.bserved there had been a critical change in the position of Britain in Egypt. The means and the will to exert British military power directly in Cairo had quietly collapsed in January 1952. The political crowbar in the Residency's possession since the era of Cromer could no longer be used. Yet, in London, the value of Egypt and the Ca.n.a.l Zone base had never seemed higher. Reaching an agreement over the use of the base and for Egypt's cooperation in Middle East defence was as urgent a priority for Churchill's government as it had been for Attlee's. But, by the time it was signed in October 1954, it was an open question whether the hard-won agreement had any value at all, except to avoid a hugely embarra.s.sing 'scuttle'. The arduous path to its making had signalled a shift in the balance of strength. The tragedy that followed sprang from a gross paradox. The importance that London attached to its regional primacy now had no counterpart in its regional power: the reverse was the case. The desperate remedy of Eden's Suez invasion was required to conceal this. The crushing failure that followed exposed its truth.

Why did London care so much about Egypt and the Ca.n.a.l Zone? Behind the logistical detail of stores and supply routes, the imaginary defence lines against a Soviet advance into the Middle East, and the plans to bomb Southern Russia in the event of world war, lay a (largely) unspoken a.s.sumption. Britain's ability to use the Ca.n.a.l Zone and its bases (as well as drawing more widely on Egyptian resources since the Zone was not self-sufficient) was its greatest surviving geostrategic a.s.set outside the Home Islands. It served as the pivot from which British power could be projected north towards Russia, eastwards to the Gulf (and its oil), across the Indian Ocean to Australia and New Zealand, and south to East Africa. The Ca.n.a.l Zone depended upon Egyptian goodwill to function efficiently; but it was also the lever with which to extract cooperation from Cairo. Preserving Britain's claim to make use of the Zone was a standing affront to Egyptian nationalist feeling. But it was also the main guarantee that Egypt's leaders would take a 'realistic' view of their national interests and accept the reality of their 'satellite' status in the British world-system.

Egypt was important for itself. It was also the pre-eminent state of the Arab Middle East. It had the biggest population, the largest middle cla.s.s and the oldest tradition of nationalist politics. Its writers, intellectuals and journalists exerted a pan-Arab influence. For most cultural purposes, Cairo was the capital of the Arab world. The Al-Azhar, half mosque, half university, was the the great centre of Islamic learning. This gave Anglo-Egyptian relations a particular delicacy. A compliant, if not 'loyal', Egypt was the key component of Britain's Middle Eastern great centre of Islamic learning. This gave Anglo-Egyptian relations a particular delicacy. A compliant, if not 'loyal', Egypt was the key component of Britain's Middle Eastern imperium imperium as as the the regional power, regulating the relations of the Arab states with each other as well as with the outside world. An Egyptian 'revolt' against this 'system' would be a serious threat. As we have seen, under post-war conditions the Arab Middle East as a whole had become even more valuable from London's viewpoint than before 1939. This was partly a matter of strategic defence against Russia, partly a matter of oil. But, despite the prominence that both these a.s.sume in the archival record, the intensity with which British leaders regarded their Middle East interests, and the extent to which they became the index of Britain's world power status, hint at a larger a.s.sumption. It was sometimes expressed in terms of prestige, but its real meaning ran deeper. regional power, regulating the relations of the Arab states with each other as well as with the outside world. An Egyptian 'revolt' against this 'system' would be a serious threat. As we have seen, under post-war conditions the Arab Middle East as a whole had become even more valuable from London's viewpoint than before 1939. This was partly a matter of strategic defence against Russia, partly a matter of oil. But, despite the prominence that both these a.s.sume in the archival record, the intensity with which British leaders regarded their Middle East interests, and the extent to which they became the index of Britain's world power status, hint at a larger a.s.sumption. It was sometimes expressed in terms of prestige, but its real meaning ran deeper.

Before 1939, it was a commonplace that the ultimate source of British power in the world, including its great-power status in Europe, was the Royal Navy. British sea-power had had to share global supremacy with that of America: but, in European waters and the Indian Ocean, it had remained pre-eminent in the inter-war years. Almost unheralded, the course and outcome of the Second World War struck the maritime sword from Britain's hand. Taken together, the growth of air warfare, the ma.s.sive scale of Soviet land forces and the colossal expansion of the American navy removed any illusion that the strategic significance of Britain's sea-power was remotely comparable with what it had been just a decade before. We 'cannot afford the American technique of building up large naval forces to support continental land battles', remarked the Chiefs of Staff sorrowfully.60 The Middle East The Middle East imperium imperium silently filled the gap. Strategic command of the region gave Britain a critical role in the defence of Europe. It secured its primacy among the West European states and (perhaps more important) conferred an exceptional leverage in London's often tetchy relations with Washington. More than anything else, it lifted Britain out of the category of a merely European power. And, although London sought material help from the Americans, it insisted on Britain's claim to be the silently filled the gap. Strategic command of the region gave Britain a critical role in the defence of Europe. It secured its primacy among the West European states and (perhaps more important) conferred an exceptional leverage in London's often tetchy relations with Washington. More than anything else, it lifted Britain out of the category of a merely European power. And, although London sought material help from the Americans, it insisted on Britain's claim to be the political political guardian of the West's regional interests. In the plans drawn up in mid-1953, it was British, Arab and Commonwealth forces that were to defend the Middle East against a Soviet invasion. guardian of the West's regional interests. In the plans drawn up in mid-1953, it was British, Arab and Commonwealth forces that were to defend the Middle East against a Soviet invasion.61 Among British leaders, no one was more sensitive than Anthony Eden to the grand geopolitics of Middle East power. Among British leaders, no one was more sensitive than Anthony Eden to the grand geopolitics of Middle East power.

This was the setting in which the British tried to reopen the question of their right to use the Ca.n.a.l Zone bases after the expiry of the 1936 treaty due in 1956. Eden as Foreign Secretary was determined to do this, despite lurid warnings from Cairo where the British amba.s.sador was convinced that Egypt was on the brink of chaos.62 Against Churchill's scepticism and the amba.s.sador's proposal that, rather than seek an agreement, British policy should aim 'to isolate Egypt as a potential enemy', Against Churchill's scepticism and the amba.s.sador's proposal that, rather than seek an agreement, British policy should aim 'to isolate Egypt as a potential enemy',63 Eden insisted that the new set of ministers King Farouk had appointed (following the b.l.o.o.d.y riots in Cairo) offered the best chance for striking a bargain. Egypt, as part of a new 'Middle East Command', would take charge of the Ca.n.a.l Zone bases in peacetime. The British would keep on the spot only the minimum force needed to 'help' the Egyptians to maintain the bases. The alternative, Eden warned his Cabinet colleagues, was a long confrontation and the effective loss of the base. 'I am convinced', he told Churchill, Eden insisted that the new set of ministers King Farouk had appointed (following the b.l.o.o.d.y riots in Cairo) offered the best chance for striking a bargain. Egypt, as part of a new 'Middle East Command', would take charge of the Ca.n.a.l Zone bases in peacetime. The British would keep on the spot only the minimum force needed to 'help' the Egyptians to maintain the bases. The alternative, Eden warned his Cabinet colleagues, was a long confrontation and the effective loss of the base. 'I am convinced', he told Churchill, that we shall not reach an agreement unless we are willing to agree to the principle of evacuation. The net result of the last five months has been to bring Egypt to the verge of anarchy. The present Egyptian government is the best we can hope for. Its position is precarious and its continuance in power depends on its ability to clip the wings of the Wafd. To do this it needs some helpful move by us, and it needs it soon...The plain fact is that we are no longer in a position to impose our will on Egypt, regardless of the cost in men, money, and international goodwill both throughout the Middle East and in the rest of the world. that we shall not reach an agreement unless we are willing to agree to the principle of evacuation. The net result of the last five months has been to bring Egypt to the verge of anarchy. The present Egyptian government is the best we can hope for. Its position is precarious and its continuance in power depends on its ability to clip the wings of the Wafd. To do this it needs some helpful move by us, and it needs it soon...The plain fact is that we are no longer in a position to impose our will on Egypt, regardless of the cost in men, money, and international goodwill both throughout the Middle East and in the rest of the world.64 But progress was meagre. There was little incentive for the Egyptian ministers to risk acceptance of Eden's terms, all too readily seen as a transparent device for keeping Britain's grip on the Zone and its military bases. Nor did they dare give up Egypt's claim to be sovereign in the Sudan, whose political future remained deeply uncertain. The Egyptian amba.s.sador was convinced, reported a senior Foreign Office official, that the only chance of our inducing the Egyptians either to accept our formula or to begin negotiations with us over the Sudan...lay in our being able to make them believe that the ultimate result of their refusal...would be the reoccupation of Cairo by British forces. This was the only thing they were really scared of. that the only chance of our inducing the Egyptians either to accept our formula or to begin negotiations with us over the Sudan...lay in our being able to make them believe that the ultimate result of their refusal...would be the reoccupation of Cairo by British forces. This was the only thing they were really scared of.65 While the British brooded over this latest rebuff and pondered Egypt's place in their new global strategy, Cairo's politics lurched in an unexpected direction.66 In July 1952, a military coup pushed aside the old rivalry between the Court and the Wafd. The 'Revolutionary Command Council', led by Neguib and Na.s.ser, became the real power. The Egyptian army, hitherto a quiescent if discontented force, now had to be squared. In July 1952, a military coup pushed aside the old rivalry between the Court and the Wafd. The 'Revolutionary Command Council', led by Neguib and Na.s.ser, became the real power. The Egyptian army, hitherto a quiescent if discontented force, now had to be squared.

By the end of the year, Eden was ready to try again. The same set of pressures was still pushing him forward. Without Egyptian goodwill, the Ca.n.a.l Zone was useless as a great military base. Indeed, without an agreement, it might become the scene of a guerrilla war. Its huge British garrison of 80,000 men was chiefly employed in defending itself: 'It is their presence that creates the need for them to be there', said a British official with mandarin irony.67 But simply handing it over would be a colossal defeat. It must be available in case of a war against Russia, said the military planners. Egypt had to promise its help if the Middle East were invaded. To let Cairo completely cut loose from its British connection would weaken Britain's allies in the other Arab states, and might provoke further demands for British withdrawal including from the important air bases at Habbaniya and Shaiba in Iraq. It would signal a drastic decline in both the will and the means to enforce British interests. It would be bound to stir up fierce objection at home among those who disliked the 'appeas.e.m.e.nt' of nationalism or any retreat on the front line of empire opinions well represented in the Conservative party. Eden's new formula was a cautious advance on the abortive proposal for a 'Middle East Command'. Now, with American backing, the Egyptians were urged to join a new organisation for the region's defence, the 'Middle East Defence Organisation' or MEDO. Loosely modelled on NATO, MEDO would include both the Arab states and their Western 'friends', princ.i.p.ally Britain and the United States. On joining this club, Egypt would be entrusted with the Ca.n.a.l Zone and its bases, to be run with some British help. This time the prospects for settlement seemed brighter. In February 1953, London and Cairo reached an agreement on the future of the Sudan, so often the stumbling block to their friendly relations. Like all previous regimes, Egypt's military leaders were determined to regain what they saw as its rightful authority in the vast country it had colonised in the previous century but then lost to the Mahdist revolt and the British reconquest. All shades of opinion resented what was seen as a British conspiracy to encourage Sudan's separation and patronise Sudanese nationalism. The British, for their part, had briefly considered giving up the Sudan as the price for a new treaty with Cairo in 1946, but then had drawn back. But simply handing it over would be a colossal defeat. It must be available in case of a war against Russia, said the military planners. Egypt had to promise its help if the Middle East were invaded. To let Cairo completely cut loose from its British connection would weaken Britain's allies in the other Arab states, and might provoke further demands for British withdrawal including from the important air bases at Habbaniya and Shaiba in Iraq. It would signal a drastic decline in both the will and the means to enforce British interests. It would be bound to stir up fierce objection at home among those who disliked the 'appeas.e.m.e.nt' of nationalism or any retreat on the front line of empire opinions well represented in the Conservative party. Eden's new formula was a cautious advance on the abortive proposal for a 'Middle East Command'. Now, with American backing, the Egyptians were urged to join a new organisation for the region's defence, the 'Middle East Defence Organisation' or MEDO. Loosely modelled on NATO, MEDO would include both the Arab states and their Western 'friends', princ.i.p.ally Britain and the United States. On joining this club, Egypt would be entrusted with the Ca.n.a.l Zone and its bases, to be run with some British help. This time the prospects for settlement seemed brighter. In February 1953, London and Cairo reached an agreement on the future of the Sudan, so often the stumbling block to their friendly relations. Like all previous regimes, Egypt's military leaders were determined to regain what they saw as its rightful authority in the vast country it had colonised in the previous century but then lost to the Mahdist revolt and the British reconquest. All shades of opinion resented what was seen as a British conspiracy to encourage Sudan's separation and patronise Sudanese nationalism. The British, for their part, had briefly considered giving up the Sudan as the price for a new treaty with Cairo in 1946, but then had drawn back.68 Neither Attlee nor Bevin had known the Sudan's peculiar history unlike the veteran of Omdurman now at 10 Downing Street. The 1953 agreement was an interesting compromise. It promised Sudanese self-government by 1956, the same year that the Anglo-Egyptian treaty expired. The Sudanese people would choose through the ballot box whether they wished to become independent or seek a union with Egypt. For both the signatories it was a calculated risk. But Neguib (who had close ties with the Sudan) may have hoped that giving up Egypt's sovereignty claim would increase the backing for union in Sudanese politics against its Mahdist opponents and their nationalist rhetoric. Neither Attlee nor Bevin had known the Sudan's peculiar history unlike the veteran of Omdurman now at 10 Downing Street. The 1953 agreement was an interesting compromise. It promised Sudanese self-government by 1956, the same year that the Anglo-Egyptian treaty expired. The Sudanese people would choose through the ballot box whether they wished to become independent or seek a union with Egypt. For both the signatories it was a calculated risk. But Neguib (who had close ties with the Sudan) may have hoped that giving up Egypt's sovereignty claim would increase the backing for union in Sudanese politics against its Mahdist opponents and their nationalist rhetoric.69 But as the pessimists had predicted, the defence talks soon stalled. Neguib and his colleagues rejected an advance commitment to MEDO. Na.s.ser knew about 'Rodeo', said an emba.s.sy official70 and was deeply suspicious of British intentions. The Revolutionary Command Council had one ambition to get the British troops out and end any risk of British intervention in Cairo. The delicate balance of Egyptian politics, in which Revolutionary Command Council rule coexisted uneasily with the monarchy (only abolished in July 1953), the Wafd party and the Muslim Brotherhood, sharpened their fear of a British 'coup' on the one hand and popular outrage on the other. They dreaded being painted as pro-British puppets betraying the national cause. They were determined not to let any British military units, however disguised as 'technicians', remain in the Ca.n.a.l Zone. On the British side, when deadlock was reached in the middle of May, a new wave of violence was feared. 'Serious trouble may now be imminent', warned the Joint Intelligence Committee. and was deeply suspicious of British intentions. The Revolutionary Command Council had one ambition to get the British troops out and end any risk of British intervention in Cairo. The delicate balance of Egyptian politics, in which Revolutionary Command Council rule coexisted uneasily with the monarchy (only abolished in July 1953), the Wafd party and the Muslim Brotherhood, sharpened their fear of a British 'coup' on the one hand and popular outrage on the other. They dreaded being painted as pro-British puppets betraying the national cause. They were determined not to let any British military units, however disguised as 'technicians', remain in the Ca.n.a.l Zone. On the British side, when deadlock was reached in the middle of May, a new wave of violence was feared. 'Serious trouble may now be imminent', warned the Joint Intelligence Committee.71 Despite Churchill's reluctance to make any further concessions, a new round of talks was begun, with the outgoing British commander-in-chief in Egypt, General Sir Brian Robertson, negotiating soldier to soldier. With MEDO now dead (the final rejection came in July), disagreement was centred on how the base would be managed once the British withdrew, and how large a force of technicians would be required to maintain it. The discussions struggled on. In September, the Egyptians raised a further objection: the British technicians must be in civilian clothes. In London, the Cabinet decided first to break off, but then to press on. But, as the year came to an end, they had little to show. The Egyptians were willing to let the Ca.n.a.l base be used if an Arab state was attacked, but not Turkey or Iran, the Soviet Union's Middle East neighbours. They wanted a swift British withdrawal and a minimal presence of non-uniformed technicians. They would only consider a seven-year agreement. Despite Churchill's reluctance to make any further concessions, a new round of talks was begun, with the outgoing British commander-in-chief in Egypt, General Sir Brian Robertson, negotiating soldier to soldier. With MEDO now dead (the final rejection came in July), disagreement was centred on how the base would be managed once the British withdrew, and how large a force of technicians would be required to maintain it. The discussions struggled on. In September, the Egyptians raised a further objection: the British technicians must be in civilian clothes. In London, the Cabinet decided first to break off, but then to press on. But, as the year came to an end, they had little to show. The Egyptians were willing to let the Ca.n.a.l base be used if an Arab state was attacked, but not Turkey or Iran, the Soviet Union's Middle East neighbours. They wanted a swift British withdrawal and a minimal presence of non-uniformed technicians. They would only consider a seven-year agreement.

The reaction in London was frustration and rage. From the Cairo emba.s.sy came a bitter reflection on the futility of continuing the search for agreement. Even if one were made, wrote Robin Hankey, then in charge at the emba.s.sy, it was highly doubtful that the Egyptians would honour it. 'If after making the new defence agreement we are held in the same utter contempt as we seem to have been since the Sudan Agreement, no favourable outcome in the Ca.n.a.l Zone can conceivably be hoped for'.72 The agreement, anyway, was most unlikely to be renewed and 'may well be turned into a farce before its expiry'. In Hankey's grim view, 'the effect...on our position in the other Arab countries and on our whole position in the Mediterranean, in the Persian Gulf and in the Indian Ocean would be incalculable...it would far surpa.s.s the effect of Abadan or Palestine'. The agreement, anyway, was most unlikely to be renewed and 'may well be turned into a farce before its expiry'. In Hankey's grim view, 'the effect...on our position in the other Arab countries and on our whole position in the Mediterranean, in the Persian Gulf and in the Indian Ocean would be incalculable...it would far surpa.s.s the effect of Abadan or Palestine'.73 Churchill's impatience now boiled over. He had carefully distanced himself from Eden's diplomacy and what he called 'your treaty'. He was much more receptive than Eden had been to the flouts and jibes of the 'Suez Group', the forty-one Conservative MPs led by Charles Waterhouse and Julian Amery who opposed evacuation, and may even have hinted at his private approval. As the Queen's first minister, he did not wish to preside over the liquidation of the Suez Ca.n.a.l base, that great symbol of empire. Like Hankey, he feared that, once a withdrawal began, it would become a rout. Then 'many in our own party will be able to say "I told you so", and the others will mock'. Churchill's solution was to make a clean break but exact a revenge: to redeploy British troops to bases elsewhere in the region, but send reinforcements to Khartoum. Egypt would thus forfeit its Sudanese prize. Once this was done, 'all the Conservative troubles here would be quenched...There is no alternative except a prolonged humiliating scuttle before all the world'. Churchill's impatience now boiled over. He had carefully distanced himself from Eden's diplomacy and what he called 'your treaty'. He was much more receptive than Eden had been to the flouts and jibes of the 'Suez Group', the forty-one Conservative MPs led by Charles Waterhouse and Julian Amery who opposed evacuation, and may even have hinted at his private approval. As the Queen's first minister, he did not wish to preside over the liquidation of the Suez Ca.n.a.l base, that great symbol of empire. Like Hankey, he feared that, once a withdrawal began, it would become a rout. Then 'many in our own party will be able to say "I told you so", and the others will mock'. Churchill's solution was to make a clean break but exact a revenge: to redeploy British troops to bases elsewhere in the region, but send reinforcements to Khartoum. Egypt would thus forfeit its Sudanese prize. Once this was done, 'all the Conservative troubles here would be quenched...There is no alternative except a prolonged humiliating scuttle before all the world'.74 Eden rejected this view completely. To leave the Ca.n.a.l Zone without an agreement would be 'less satisfactory from the point of view of our continuing authority in the Middle East'.75 This was his real concern. He had told Churchill earlier that a unilateral withdrawal posed considerable risks. 'It could be very damaging to our whole reputation and position if it looked like running away...It could destroy all hope of maintaining our position in Iraq and the Persian Gulf.' This was his real concern. He had told Churchill earlier that a unilateral withdrawal posed considerable risks. 'It could be very damaging to our whole reputation and position if it looked like running away...It could destroy all hope of maintaining our position in Iraq and the Persian Gulf.'76 Nor would it help matters to arouse the suspicions of Sudanese nationalists that London meant to renege on the promises made in the Sudan agreement. Like his officials in Cairo, Eden was inclined to lay much of the blame for Egyptian intransigence on American disloyalty and their tacit subversion of British prestige. 'The American position over Egypt becomes increasingly unhelpful', he minuted bitterly. 'The Americans will have no friends left if they go on in this way.' Nor would it help matters to arouse the suspicions of Sudanese nationalists that London meant to renege on the promises made in the Sudan agreement. Like his officials in Cairo, Eden was inclined to lay much of the blame for Egyptian intransigence on American disloyalty and their tacit subversion of British prestige. 'The American position over Egypt becomes increasingly unhelpful', he minuted bitterly. 'The Americans will have no friends left if they go on in this way.'77 What was becoming uncomfortably obvious was that without American backing there was little that could drive the Egyptians to sign. Lord Salisbury, Eden's stand-in during his long illness in 1953, had made the point bluntly. 'If we reach an agreement with Egypt', he told the Cabinet in July 1953, 'it will...be essential that the Americans underwrite such an agreement if there is to be any prospect of the Egyptians keeping it.' What was becoming uncomfortably obvious was that without American backing there was little that could drive the Egyptians to sign. Lord Salisbury, Eden's stand-in during his long illness in 1953, had made the point bluntly. 'If we reach an agreement with Egypt', he told the Cabinet in July 1953, 'it will...be essential that the Americans underwrite such an agreement if there is to be any prospect of the Egyptians keeping it.'78 Churchill now pressed Eisenhower to refuse the Egyptians economic aid until they agreed on a treaty, but the reply was guarded. How far, Eisenhower asked, was Britain willing to go to support American efforts to isolate 'the b.l.o.o.d.y Chinese aggressor' and oppose its admission into the United Nations? Churchill now pressed Eisenhower to refuse the Egyptians economic aid until they agreed on a treaty, but the reply was guarded. How far, Eisenhower asked, was Britain willing to go to support American efforts to isolate 'the b.l.o.o.d.y Chinese aggressor' and oppose its admission into the United Nations?79 Had not the British been happy to trade with China? The implication was obvious. Perhaps it was this that occasioned Eden's anti-American outburst. Had not the British been happy to trade with China? The implication was obvious. Perhaps it was this that occasioned Eden's anti-American outburst.

He had little choice, however, but to rehea.r.s.e to his colleagues the urgency of reaching some kind of agreement: 'If we do not succeed, we are in a bad position.'80 Failure would mean the more or less rapid erosion of Britain's Arab prestige. It would reduce Britain's claim on the support of Australia, New Zealand and South Africa. And, if the Suez base were simply abandoned, it would be almost impossible to persuade British opinion to accept other commitments in the Middle East. When the Chiefs of Staff weighed in with a warning that a withdrawal agreement was of the 'utmost importance', a subtle change could be seen coming over the British approach. However useful the Ca.n.a.l base might be in a general war (now thought less likely), it was more important to get out to save money, men and morale. Indeed, in the spring and summer of 1954, geostrategic change suggested that the base was now of secondary value at best. Its exposure to air attack was greatly enhanced or so it was argued by the advent of the hydrogen bomb. Secondly, the strategic defence of the Middle East was conceived more and more in terms of the 'Northern Tier' states Turkey, Iraq, Iran and Pakistan backed up by the use of tactical nuclear weapons and local air bases: the drift of American thinking since mid-1953. What mattered most to the British was a dignified exit from the Ca.n.a.l Zone and (increasingly) rea.s.surance that their use of the Ca.n.a.l would not be affected by a military withdrawal. When the Americans promised to delay any aid until Egypt signed up, and Na.s.ser let it be known that an attack on Turkey would permit reactivation of the base, a light seemed to glint at the end of the tunnel. But clinching the deal seemed as elusive as ever. In Cairo, General Neguib was first removed as the leader of the Revolutionary Command Council and then restored. The transfer of power to civilian rule and a return to party politics were promised and rescinded within a matter of days. Failure would mean the more or less rapid erosion of Britain's Arab prestige. It would reduce Britain's claim on the support of Australia, New Zealand and South Africa. And, if the Suez base were simply abandoned, it would be almost impossible to persuade British opinion to accept other commitments in the Middle East. When the Chiefs of Staff weighed in with a warning that a withdrawal agreement was of the 'utmost importance', a subtle change could be seen coming over the British approach. However useful the Ca.n.a.l base might be in a general war (now thought less likely), it was more important to get out to save money, men and morale. Indeed, in the spring and summer of 1954, geostrategic change suggested that the base was now of secondary value at best. Its exposure to air attack was greatly enhanced or so it was argued by the advent of the hydrogen bomb. Secondly, the strategic defence of the Middle East was conceived more and more in terms of the 'Northern Tier' states Turkey, Iraq, Iran and Pakistan backed up by the use of tactical nuclear weapons and local air bases: the drift of American thinking since mid-1953. What mattered most to the British was a dignified exit from the Ca.n.a.l Zone and (increasingly) rea.s.surance that their use of the Ca.n.a.l would not be affected by a military withdrawal. When the Americans promised to delay any aid until Egypt signed up, and Na.s.ser let it be known that an attack on Turkey would permit reactivation of the base, a light seemed to glint at the end of the tunnel. But clinching the deal seemed as elusive as ever. In Cairo, General Neguib was first removed as the leader of the Revolutionary Command Council and then restored. The transfer of power to civilian rule and a return to party politics were promised and rescinded within a matter of days.81 It was only during April that Na.s.ser's authority seemed firmly established. The British still fretted over how to present the concessions they were now willing to make (the use of civilian labour to service the base) and how to ensure that, with no military presence, the Egyptians could be held to their promise to maintain the base and respect free transit through the Ca.n.a.l. Churchill and Eden now agreed (Eden with some show of reluctance) to seek more explicit American help. At the Washington conference in June (mainly taken up with discussion of Churchill's scheme for a summit conference with the Russians), Dulles and Eisenhower gave the vital a.s.surance: Na.s.ser would be told that all American aid would depend on his keeping the promises made in a treaty. It was only during April that Na.s.ser's authority seemed firmly established. The British still fretted over how to present the concessions they were now willing to make (the use of civilian labour to service the base) and how to ensure that, with no military presence, the Egyptians could be held to their promise to maintain the base and respect free transit through the Ca.n.a.l. Churchill and Eden now agreed (Eden with some show of reluctance) to seek more explicit American help. At the Washington conference in June (mainly taken up with discussion of Churchill's scheme for a summit conference with the Russians), Dulles and Eisenhower gave the vital a.s.surance: Na.s.ser would be told that all American aid would depend on his keeping the promises made in a treaty.82 The British agreed to give way on the uniforms question. Within three weeks, the 'heads of agreement' had been signed in Cairo. The British would pull out completely over the course of twenty months (by June 1956), leaving civilian contractors to look after the base. They could use the base to help defend either Turkey or an Arab state from attack. But the treaty would last (as Na.s.ser insisted) not twenty years but seven. The British agreed to give way on the uniforms question. Within three weeks, the 'heads of agreement' had been signed in Cairo. The British would pull out completely over the course of twenty months (by June 1956), leaving civilian contractors to look after the base. They could use the base to help defend either Turkey or an Arab state from attack. But the treaty would last (as Na.s.ser insisted) not twenty years but seven.

It is an intriguing question as to what persuaded Churchill to give his reluctant a.s.sent to the retreat he disliked. In his public defence he stressed the impact of the new H-bomb as making the Ca.n.a.l base redundant. But, if that were the reason, as a Tory critic remarked later, why was so much of the treaty concerned with its future use?83 In the Cabinet discussion, there is more than a hint that the H-bomb was a rabbit pulled out of the hat: it gave Churchill the escape route that he (and the government) needed, dousing (for the moment) the smouldering backbench rebellion. Churchill may also have wanted to clear the decks for his real ambition the summit with Stalin's successors. The more interesting question is what the agreement meant for Britain's Middle Eastern position the main justification that Eden advanced. Leaving the base was meant to give Britain's regional In the Cabinet discussion, there is more than a hint that the H-bomb was a rabbit pulled out of the hat: it gave Churchill the escape route that he (and the government) needed, dousing (for the moment) the smouldering backbench rebellion. Churchill may also have wanted to clear the decks for his real ambition the summit with Stalin's successors. The more interesting question is what the agreement meant for Britain's Middle Eastern position the main justification that Eden advanced. Leaving the base was meant to give Britain's regional imperium imperium a new lease of life, not to signal a general retreat. It did not turn out like that. a new lease of life, not to signal a general retreat. It did not turn out like that.

In fact, the Ca.n.a.l base agreement embodied a transfer of power as important as any that was made in the retreat from empire after 1945, with the single exception of the withdrawal from India. This was veiled at the time from the makers of policy (although not from their critics). They averted their eyes from the three critical factors that governed the course and outcome of their diplomatic ordeal. The first was the change in the nature of Egyptian politics. Disillusioned with the Wafd and the king, the British were not unsympathetic to the military rulers who replaced them. Na.s.ser, they thought, was a 'realist' and honest. The political turmoil of 19524 made it harder to see that the chaos and corruption of 'liberal' Egypt was making way for an authoritarian regime driven restlessly forward by populist nationalism and geopolitical ambition. The Ca.n.a.l base agreement was its ticket to power. The British liked to think that Na.s.ser would be a new Ataturk, the Turkish strong man with whom they had come to amicable terms after 1922. Na.s.ser, they thought, would follow the Ataturk model, and devote his political energy to internal reform. It was a drastic misjudgment. The second great shift may have been easier to see but harder to acknowledge. Again and again the men on the spot had complained that their efforts to make the Egyptians see reason had been frustrated by the nods and winks of the American amba.s.sador, Jefferson Caffery. At a much higher level, the British were dimly aware that Washington was pursuing a different agenda, that they could not match its promise of aid, and that without American backing the treaty they sought would be hard to achieve and worse to enforce. The Ca.n.a.l base agreement was a silent reminder that British authority now needed the weight of American power, and was unlikely to flourish without its support. The third was the change from Egypt to Iraq as the strategic pivot of the British position. The growing importance of the 'Northern Tier' states (Turkey, Iraq, Iran and Pakistan) as the main barrier to a Soviet advance had helped to devalue the Ca.n.a.l base and ease the pangs of the British withdrawal. It made the British now eager to build up Iraq as the main Arab component of a new Middle Eastern alliance, and to attach as many Arab states as they could to what became known as the 'Baghdad Pact'84 of which they themselves would also be members. This would be the new platform of their Middle Eastern position: an Arab 'bloc' of which the 'Hashemite' kingdoms of Iraq and Jordan and the Syrian Republic (domination of Syria was an old Hashemite aim) would be the core members. But, between the Hashemite kings and the Iraq 'strong man' Nuri as-Said on the one hand, and Na.s.ser on the other, there was little love lost. Both claimed the leadership of the Arab world. Thus the curious sequel to the British agreement with Na.s.ser was their strategic partnership with his bitterest enemies. of which they themselves would also be members. This would be the new platform of their Middle Eastern position: an Arab 'bloc' of which the 'Hashemite' kingdoms of Iraq and Jordan and the Syrian Republic (domination of Syria was an old Hashemite aim) would be the core members. But, between the Hashemite kings and the Iraq 'strong man' Nuri as-Said on the one hand, and Na.s.ser on the other, there was little love lost. Both claimed the leadership of the Arab world. Thus the curious sequel to the British agreement with Na.s.ser was their strategic partnership with his bi