In 1914, Great Britain enacted a plan to win its war with German by effectively destroying modern civilization.
In 1914, Great Britain went to war. It was a war that many in London had seen coming, as the Royal Navy and the British Army had shifted their attention towards Germany's growing power on the European continent since 1905. With little exception since the French Revolution, the Royal Navy had planned for war against Europe's two other great naval powers, France and Russia. But by the turn of the 20th century, Imperial Germany and the Kaiser's High Seas Fleet (before 1907 the Home Fleet) were the main adversaries.
A New Kind of War
Between 1908 and 1912, the British developed a new strategy to combat its new foe: total economic warfare. This called for nothing less than the complete and total destruction of the global economy. As the historian Nicholas Lambert described the plan, it was nothing less than a "kind of economic mutually assured destruction," which was based on the singular premise that if the system collapsed, Germany, not Britain, would be the first state to disintegrate or sue for peace.
Thinking ahead to the eventual British blockade of the North Sea, it would be fair to think that these plans were simply the delusional fantasies of underworked war planners, drawing up designs which nobody in their right mind would ever use. Yet this isn't the case. The plans that the British Admiralty developed in 1912 were wholeheartedly implemented in August 1914. It was only after serious blowback were these wild designs shelved in favor of a more moderate, longer term, plan to choke off Germany. But thanks to the work of recent historians, we now know about these plans and how deep the British commitment was to ending the modern world.
For the Royal Navy, Germany's fleet posed a significant and unique challenge. First, the Germany Navy presented a unique threat. It was large, heavy, and dominated by battleships that did not present a serious threat to British commerce outside the North Sea. The majority of the German fleet lacked the range and the bases it needed to cut off British communications with India, America, and its other far-flung territories and relations, but they did pose a threat to the Home Fleet and the Home Islands themselves.
Second, despite large investments, including many new battleships and battlecruisers, the Germany Navy remained second in stature and importance to the army. In London, most understood that if war came – or rather, when war came – it would come on the continent and would take the form of a great land battle in France. The army argued that the best defense against such an attack would be to take the very un-British step of sending a large land army to France to help stop this blow. Understandably, the admiralty disliked this strategy, as did much of the civilian government. It was up to the navy and admiralty planners to come up with an alternative to the continental strategy.
Their alternative was bold and modern. They recognized that time was not on Britain's side. As long as the war persisted, the British risked defeat on the continent. Or worse, the Germans might mobilize sufficient resources to become virtually invulnerable to sea power. Thus, the Royal Navy hoped to deliver a blow so sharp and severe in the first days of the war that Germany would be forced to surrender or risk being exposed to the harshest possible pressure. Instead, planners in the admiralty devised a solution designed to destroy the German economy and its overseas trade virtually overnight.
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Putting Armageddon Into Action
In the early 20th century, London sat at the center of the single most important financial network in the world. Its banks financed most of the world's trade, which was carried by British flagged vessels, who were insured through The Lloyds Bank in London. This trade was secured thanks to the ships of the Royal Navy's many far-flung fleets, and any trade into Germany had to pass either through the Strait of Dover, the North Sea, or the two narrow entrances to the Mediterranean. The plan then was two-fold. First, by prearranged agreement with banks, the Royal Navy would take control of London's financial institutions, including Lloyds. They would unilaterally cancel all the insurance contracts and seize Lloyd's most prized records, their list of ship's cargos, their destinations, and proposed courses. Lending institutions would also be forced to freeze all lending to international shipping companies, especially those which did business with Germany or carried German goods.
This program would cripple international trade. Lenders would be too afraid to loan money to companies whose cargos were at risk, while shippers would refuse to carry any cargo lest they risk the uninsured loss of their ship. Armed with detailed shipping records for nearly every ship in the world, acquired from Lloyd's, the Royal Navy could then apply further pressure by threatening to sink ships destined for unfriendly ports. This was the second phase of the plan. Even if just German flagged ships were attacked initially, the damage to the international economy could be devastating.
Even worse, such an action would potentially cause major ripples in national and international markets. Overseas shipping, which accounted for over 90 percent of global trade in 1900, was the lifeblood of industries across the world. Completely cutting off all trade would mean beef grown in Argentina wouldn’t reach families in Berlin, or that oil pumped in Texas wouldn’t reach engines in Vienna. This would damage not just the economies of the belligerent nations, but the economy of every nation on Earth, including the British. Stock exchanges and banks would have to completely change how they valued companies and assets, as well as completely freeze all lending. The targets of this attack would have two choices, watch as their economies and societies dissolved (or revolted against the ruling elite), or come to quick terms to relieve the pressure. However, this also required the British to be resolute and confident in their plans. If let up before Germany was broken, supplies, money could flow in and preventative measures could be taken to harden the economy against this assault.
This plan was ultimately the one the British put into practice as the Fleet sailed for Scapa Flow in August, 1914. Lloyd's did their patriotic duty and willingly turned their records over to the Royal Navy. The orders for the nationalization of the banks, which had been prewritten before the war to save time, were sent out and the government nominally took control over the organs of the economy. However, at the last moment, Whitehall balked at the enormity of what it was considering. The plan was a sledgehammer, a blunt instrument which attacked friend, foe, and neutral alike.
Once the Woodrow Wilson administration, learned that neutral trade with Germany might be affected by the war, the US immediately began working to undermine its effectiveness. Had the Royal Navy fully committed at this moment to its plan, it probably would have caused a global financial crash. But fearing what this crash might do, policymakers in London instead chose to pause the implementation of their plans and wait to see how the continental war evolved. They missed their moment to smash the German economy and bring a quick conclusion to the war. By the time discussions arose again about the Navy's role, it was too late, the German economy had already taken steps to divest itself of British money and companies.
Victory Without A Planned Financial Crash
This is not to say that the plan did not live on in the minds of British planners. Instead, it evolved into the British blockade, which we more typically associate with Royal Navy in World War I. The blockade was a direct outgrowth of the same ideas, and especially phase two of the prewar plan, except that it more specifically targeted Germany and its lifeline through the North Sea. And this more limited blockade, true to concerns in August, turned out to be extremely controversial with neutrals like the United States. It also was nowhere nearly as tight or as effective as the British had hoped, it only truly limited trade (even though British companies!) in 1917.
Perhaps the more radical plan would have had immediate results, but it's also hard to see how Great Britain, an island nation, would survive even a short period cut off from global trade and supplies. Nevertheless, we tend to associate this kind of apocalyptic thinking to the Cold War, where planners contemplated the death of millions in atomic fire. In 1914, pulled the trigger on a plan no less destructive, but based on nothing more than financial tricks and iron-hulled warships.