The Financial Revolution in England

By the final defeat of Napoleon atWaterloo, Britain had become the dominant power in Europe and had forged the beginnings of an empire which, at the end of the nineteenth century, was to cover around a quarter of the world’s land mass. But the price of winning a place as one of the great powers was high. Britain had been at war for a little over half the period between 1688 and 1815. When not fighting, resources were often employed in preparing for war, and contemporaries lived with the belief that war was always to be expected. Moreover, the financial cost of sustained conflict was immense. By 1819, the total unredeemed capital of the public debt stood at a little more than £844 000 000. This was a staggering sum for an industrializing nation, and Britain’s ability to sustain such a high burden of debt without descending into political and economic chaos forcibly demonstrates both the effectiveness of its system of state finance and how much the British war machine owed to the willingness of investors to lend to their government.