Postwar: A History of Europe Since 1945

by Tony Judt

There were national variations in these responses to economic downturn. The French authorities pursued a practice of micro-economic intervention, identifying ‘national champions’ by sector and favoring them with contracts, cash and guarantees; whereas the UK Treasury continued its venerable tradition of macro-economic manipulation through taxes, interest rates and blanket subsidies. But what is striking is how little variation there was along political lines. German and Swedish Social Democrats, Italian Christian Democrats, French Gaullists and British politicians of every stripe instinctively clung at first to the post-war consensus: seeking full employment if possible, compensating in its absence with wage increases for those in work, social transfers for those out of work and cash subsidies for ailing employers in private and public sector alike. But over the course of the seventies a growing number of politicians came to the conviction that inflation now posed greater risks than high levels of unemployment—especially since the human and political costs of joblessness were institutionally alleviated.