The Butterfly Effect: A British AAR

El Pip · Dec 4, 2022

Chapter CLV: The St Leger's Day Massacre.

The end of summer and the start of autumn often brings with it financial problems and crises, indeed there is a traditional City saying to that effect; "Sell in May and go away, come back after St Leger's Day". While the origins of the saying may well have been a recognition of the de facto long summer break that most financial markets enjoyed it had survived so long because there was more than a grain of truth in it, following this advice would have yielded an investor good returns for much of the 20th century. There are doubtless many reasons for the poor average returns over the summer, but a key one is surely the break itself and the subsequent return. If a problem remains unsolved at the start of summer it will generally get worse over the following weeks, thus when investors and bankers return from their summer break they will find the situation considerably worse than when they left it and be prompted to hasty action, this action rarely being good for the short term value of the asset in question. For the more serious events there has likely been a degree of 'frog boiling', that is to say a chronic problem getting constantly worse but so slowly that the true scale of the predicament is not apparent, for these cases the return from summer with fresh eyes can prompt a realisation of how bad things actually are and so initiate the crisis. Appropriately enough in the autumn of 1937 the focus of the returning financial world was on the Gold Bloc and in particular France. While Paris publicly declared the sacred and eternal nature of the link between the franc and gold, in private it was recognised the cost of supporting the franc at it's current value was increasingly untenable. The Bank of France had been very active in the foreign exchange markets in the previous months however the end of summer prompted an exponential increase in the scale of the required interventions. In the first week of September the Bank of France was spending £3 million in gold a day on defending the franc, in other terms this meant just over 13 tons of bullion leaving the vaults every day, most of which was making it's way to the London gold market. In theory France could keep up such spending for many months, there had been almost 2,500 tons of bullion in the Bank of France vaults in the spring, but in reality much of that gold was needed to back the Franc. The Gold Conference in Geneva only a few months earlier had declared that 40% currency backing was the absolute minimum required to be in the Gold Bloc, on that basis France needed at least 1,500 tons and realistically nearer 1,800 tons in reserve when all liabilities were considered just to meet the bare minimum. If this had been merely another short term speculative attack then the French would doubtless have gritted their teeth and continued the spending, to a certain extent that was the point of having reserves in excess of the bare minimum. However the devaluation fears were starting to infect the wider economy, bank deposits both at the Bank of France and at the commercial banks were declining rapidly as the public sought to exchange francs for gold, sterling, or any other hard asset they could. Given the chronic weaknesses of the post-Depression French banking sector this was not something that could endured for long before serious structural damage started being done. The traditional counter was raising interest rate and this had been done several times, while this had had precious little effect on the exchange markets it had been a further blow to the economy, to the point the finance ministry was warning about a serious risk of recession, or worse, unless the currency stabilised and interest rates lowered to more appropriate levels. Taking the wider view of the whole economy the answer was as obvious as it was unpalatable; France would have to devalue.

Sir Sultan Mahomed Shah, Aga Khan III, on his way to Doncaster Racecourse for the last classic of the British flat racing season. The choice of St Leger's Day in the quoted saying was not an un-characteristic outbreak of piety from the City but a reference to this race, the St Leger's Stakes, which was named for it's military founder Major-General Anthony St Leger and not the medieval Burgundian martyr. The Aga Khan himself would end up peripherally involved in the devaluation crisis, while his experience with gold was limited to being gifted his weight in bullion for his golden jubilee the previous year, as President of the Assembly League of Nations for the 1937 session he would oversee the General Assembly that coincided with the international response to the affair.

While the Bank of France and the civil servants in the finance ministry began very quietly working on the mechanics of the devaluation, the new laws, emergency bank holiday regulations and so on, the politicians and diplomats turned to the wider implications. There were two pressing concerns about the devaluation and the first was France's continued membership of the Gold Bloc, the increasingly formal group of nations still on the gold standard. Technically France did not have to leave the gold standard in order to devalue the franc, it was theoretically possible to just revalue it in gold terms and carry on as before. In practice a devaluation would prove the speculators correct and there would be doubts that the new level of the franc was credible, consequently there would be a massive demand for gold as banks and the population scrabbled to avoid holding francs in case of a second devaluation. Of course the Bank of France could take the Italian or German route and notionally remain on the gold standard but end the right to exchange francs for gold. Unfortunately for this scheme the same Gold Bloc conference that had set the minimum backing ratio had also declared that being able to freely exchange currency for gold was a requirement for being on the gold standard, or at least a requirement for being a member of the Gold Bloc, as Italy had found out to it's disappointment. One obvious question is why Paris was so keen on remaining in the Gold Bloc and there were a range of reasons, none of which actually involved gold. As we have discussed the Gold Bloc members had lowered tariffs between themselves, not by a large amount and nothing on the scale of Empire Free Trade, but enough to be worth trying to keep and on a more practical level the clear support of the US government and Federal Reserve would make the new level of the franc easier to maintain. These were the official reasons and they were valid enough, but very unofficially Paris wanted to stay in the Bloc for strategic reasons. The Bloc was one of the few international forums that the US seriously engaged with and was the only one where Britain was not also present, it was therefore seen as a key route to engagement with the US and keeping them involved in world affairs. Given these world affairs, as defined by Paris at least, ranged from continued support for the Republican side in Spain through to security co-operation in the Pacific it is hardly surprising that this agenda could not be spoken of openly; the Landon administration was already burning political capital with it's support for Spain, so there was no appetite for another bruising fight with the isolationists over foreign affairs. The issue therefore was how to keep France de jure on the gold standard that they could stay in the Bloc, but de facto off it so they could reap the benefits of devaluation. The solution was typically French, use regulation and heavy taxes to encourage all gold holders to sell their gold to the Bank and then require all transaction in gold to be approved by the Bank of France. Paris could therefore state that the franc was still theoretically convertible with gold and thus conformed to the letter of the gold standard, if the Bank never actually gave permission for any gold transactions that was a mere irrelevant detail. Leaving aside any moral objection to this approach the challenge was to getting the rest of the Bloc to accept it. This ties in neatly with the other pressing concern, getting international agreement and support on defending the new value of the franc and not setting off a round of currency wars and competitive devaluations.

The central corbeille (basket) at the Paris Bourse with the official agents clustered around it, all trading on the exchange was via open outcry between this strictly limited group and those on the outer ring were there to support, instruct or just observe those traders. As part of the Monetary Law that changed the gold value of the franc the French government also imposed a retrospective 50% tax on any forward operations on the stock market and forced the declaration of all foreign currency operations even when not made at the exchange. Separately all gold holders in France had to either sell their gold to the Bank or pay a 'special levy' equal to the increase in the franc value of their gold after the devaluation. While such measures were doubtless satisfying to the government and parliament as a way to punish those seen to profit from France's misfortune, it also prompted another exodus of traders and business to New York, Amsterdam and above all London. As with the failure of Paris' previous attempts to be a financial centre the French were unwilling, or perhaps psychologically unable, to pay the price required to be a serious financial centre.

The United States may have been in a period of semi-isolation and disengaged from most international forums, but that did not mean they had lost all their diplomatic skills or their ability to spot a hustle. The French attempts at subtlety failed miserably, both the sleight of hand on the gold standard and the strategic reasoning for wanting to keep the Gold Bloc intact were soon spotted. Fortunately for Paris the US had it's own reasons for wanting to keep the Bloc intact, not least the lack of a plausible alternative. After the initial hurried and domestically focused reactions to the Depression US policy had been to try an rebuild international trade, as a considerable net exporter prior to the crash the collapse in trade had hit the US economy particularly hard. Unfortunately these efforts had failed and so in parallel a determined attempt had been made to build a Dollar Bloc, a economic area of preferential trade to rival the Sterling Area and the Exchange Control group forming around Germany. After many years of effort by the State Department and US Treasury the Dollar Bloc consisted of the US, the Philippines, and a smattering of smaller Central American states that had been on the receiving end of a US Marine intervention during the Banana Wars. Both policies had failed for the same reason, bipartisan political pressure that international trade be "fair" and not offer any competition to domestic industry. In practice this meant that while the US trade negotiators had no end of ideas about which tariffs and quotas other people should cut they had precious little to offer in terms of access to US markets to those negotiating a trade treaty or considering entry to the Dollar Bloc. As a result the Gold Bloc represented pretty much all of the progress the US had made towards trade liberalisation and tariff reduction, letting it fall apart risked undoing that progress and causing a further drop in trade, which would damage the still weak US domestic economy. In comparison to that possibility continuing to stay in an international talking shop seemed a small price to pay, particularly as the State Department was confident any French strategic overtures could easily be dismissed or at least politely watered down to nothing. It should also be noted there was another important reason the US response was far more enthusiastic than the French had dared hoped; the Federal Reserve was concerned that after the franc devalued it would be the dollar next to come under pressure. Devaluations must be relative to something and though both Paris and Washington were loath to admit it the reference currency of the time was, as it is today, sterling. Thus it had been the franc-sterling exchange rate that had been attacked by speculators and once the franc devalued it would be 'cable' (city slang for the dollar-sterling rate) that would be their next target. This would require the US to intervene to support the currency and as in France lead to increased public demand for 'safer' assets instead of an under-pressure dollar. In absolute terms the US Federal Reserve held far more gold bullion than the Bank of France, but as a proportion of the economy or the amount of currency in circulation, the psychologically important percentage backing of the currency, the figures were far lower. To be blunt the US would struggle to fend off gold flight of the scale France had faced for more than a couple of weeks and while the US domestic banking system was slightly stronger than in France that did not mean it could withstand extended capital flight. Recognising the inevitability of the situation the US government decided to minimise the economic costs and carry out a pre-emptive devaluation on their own terms; better to be seen as strong while making a controversial move than weak by being forced into it. To that end it was the US Treasury that came up with the final scheme adopted by the Gold Bloc, the plan should not be to devalue the franc or any other currency, instead the Bloc should say they were revaluing gold. If the entire Bloc all changed the exchange rate of their currencies to gold at the same time they could maintain it was the value of gold itself that had changed not their currencies. While this would be a devaluation relative to sterling and the rest of the world the rates between members would not change, hence the French decision to value the franc within a range not an absolute value, allowing them to conform to the letter of the devaluation while keeping flexibility to trade lower as required.

A Soviet gold mine in the mid 1930s, the crude approximations of a uniform and the pit pony indicate this is one of the more modern mines in the country at that time. The vast majority of Soviet gold production came from the mines around Kolyma in the Far East, these mines were operated by prison labour under the Gulag system and so lacked such luxuries. Global gold production increased almost 70% between 1929 and 1937 due to massive increases in US, Canadian, Australian but above all Soviet output. This should have led to a slump in the gold price as extra production flooded the market, yet the London gold fix had jumped from around £4/oz to over £7/oz in the same period. It was this disparity between the price of gold and both production and the size of the global economy that was the justification for the revaluation. Such talk was heresy to the high priests of the Gold Bloc, the League of Nation's Economic and Finance Organisation, who's economists and theorist were appalled at the very idea of devaluation and the cynical schemes being prposed to avoid keeping the 'golden promise'. However they were ultimately responsible to the League secretary-general, Joseph Avenol, a man who believed his highest concern was not the League's charter but French foreign policy. Consequently after a somewhat hustled vote of the General Assembly the plan received the League's seal of approval.

It must be noted at this point that these discussion and agreements were not taking place in a calm and considered atmosphere but in the midst of market turmoil. In financial circles it is still referred to as the Saint Leger's Day massacre, while no blood was spilled there were oceans of red ink across the stock, bond, exchange and even commodity markets on both sides of the Atlantic. As is often the case the rumours circulating were worse than the secret discussions and the speculation fuelled the volatility in the markets, particularly when it became clear the central banks were reluctant to intervene to defend rates that would soon change. It is in this context that the British cabinet and the Bank of England were presented with a tough choice around how, if at all, to react to the overtures from the Gold Bloc on co-operation around exchange rates, gold and related issues. Unusually it was genuinely a difficult decision and not the more common political version where 'tough choice' was code for 'There is an obviously correct solution to this, but it is electorally unfavourable'. There already was a degree of communication between the Bank of France and the Bank of England, as both were regularly intervening in the exchange and gold markets some unofficial co-ordination prevented their agents ending up on opposite sides of the same trade and helped solve the logistical challenges of regularly moving large quantities of bullion from Paris to London. What the French proposed was an extension of the existing Gold Bloc agreement on maintaining stability between currencies to include sterling and the Bank of England. The Bank was modestly in favour of the proposal as was the Treasury in the form of Frederick Leith-Ross, the chief economic advisor recently returned from his triumphant mission to China, who was a strong advocate for it. While far from enthused about the gold standard itself, he had after all just overseen China abandoning the silver standard and reaping the rewards, he was attracted by the stability offered and the promise to prevent another round of currency wars. To this formidable grouping could be added the Foreign Office who could still be relied upon to look favourably on almost any international agreement, particularly if it involved the prospect of improved relationships with France; one consequence of Eden selecting a passive Foreign Secretary was the lack of effort being applied to remove the lingering Francophilia in the department. In opposition the arguments were mainly revenge based, not just because of France's inaction during the Abyssinian War or it's self serving deal making at the Amsterdam Conference, but something older and more relevant. In early 1931 the UK had been struggling with a currency crisis that eventually ended in devaluation and French support had been minimal and grudging, worse that little help had been more than offset by the Bank of France systematically dumping it's own sterling reserves and hurriedly purchasing gold, a very clear sign to all involved that Paris had zero faith in sterling and a move which rapidly became a self fulfilling prophecy. In fairness while those opposed may have been in part motivated by thoughts of retribution there were other more cool headed reasons to reject the offer. Top of the list was the Gold Bloc itself, should France fail to stabilise the franc then the Bloc could well collapse and there was a strong argument this could be good for the UK. While it was very unlikely France or the US would join the Sterling Area the other Bloc countries may well do so and as we have seen this was of benefit not just to the new members but all the existing ones as well. In particular the prospect of tempting the Netherlands across and into the Sterling Area was seen as having a strategic value in addition to any economic advantages that would accrue. There was also the question of credibility, under the proposal the Bank of England and Treasury would to an extent be standing behind the new devalued level of the franc, so should the Bank of Franc fail to stabilise the franc then in part the Bank of England would also have failed. While the Bank had plenty of reserves in the Exchange Fund, and at the time was mostly fighting to restrain the pound from rising too far, the French experience was proof that if the people lost confidence in a currency then all the reserves did was delay the inevitable.

The imposing Palazzo Mezzanotte, home of the Borsa Italiana (Italian Exchange) in Milan. While Rome remained the administrative and political capital, Milan was the financial hub of Italy and so her exchange was the most prestigious and her traders the best connected, thus when rumours of the devaluation spread it was attentive ears in Milan and not Rome that heard them first. The resulting stock and currency crash was stopped before it became a widespread panic as the government agents shut the exchange, but the end result would be the same; Mussolini had lost 'The Battle of the Lira' and Italy would devalue mere hours after the official Gold Bloc announcement. Il Duce and his propagandists blamed the French and US decisions for forcing his hand, which was in part true, but there were plenty of Italian economists relieved that a long overdue devaluation of the lira was finally happening, whatever the cause.

In the end the cabinet came to a mature and considered compromise, mostly by convincing the more retribution minded members not to cut off their nose to spite their face. That said the final deal was not the 'deep co-operation' that Paris had originally proposed, in the grandest French tradition the first draft had a system whereby the Bank of France decided what interventions should be carried out to support the franc and the Bank of England would then unquestioningly implement their part. The cabinet also demurred at the proposed 'currency swaps', exactly as suggested this would involve an exchange of currencies between the two central banks, a boon to the Bank of France which would have a large amount of Sterling to spend on interventions but just a liability for the Bank of England which would receive a matching pile of francs that it didn't want and couldn't do anything with. Instead the existing unofficial co-operation between the central banks was put on a firmer footing and the three main players agreed what currency rates would be defended by the various exchange intervention and stabilisation funds. In addition the Bank of England agreed to have the necessary chats with the main British commercial banks to ensure the large sterling loan being floated in London by the Bank of France would be strongly supported and get away at an 'appropriate rate' for a government security. Said chats mostly consisted of reassurance that while the Bank of France was technically a private company, the British government considered that the French state was backing it and so would treat a failure to repay in full as a major diplomatic incident with all that entailed. To provide cover for these moves there was also a very grand sounding announcement of an international currency control agreement between London, Washington and Paris to maintain the post-devaluation currency levels and to forswear any competitive depreciations or devaluations. Grand sounding because the actual text of the agreement mostly consisted of loopholes and exceptions, nobody involved wanting to actually commit to anything beyond the very short term measures previously discussed. That said with the support of London secured Paris and Washington could finally explain the plan to the rest of the Gold Bloc and then make the announcement and devalue at the end of September. The market turmoil extended on well into October, though at a markedly lower level and well within the capacity of the intervention funds to control, making the transition a success for a suitably relaxed and expansive value of success.

The Treasury and Bank of England kept a careful eye on things and checked for domestic or Imperial consequences, but these mostly failed to emerge. There were a number of excitable stories about firms or individuals who had made fortunes by speculating on the crisis or lost them by believing French government statements, but nothing significant or out of the ordinary. The rest of the government were relieved to consider the matter closed and moved onto the other challenges facing the country. Indeed the Foreign Office and those of a Francophile disposition were optimistic that Anglo-French relations had finally hit rock bottom and this economic co-operation would lead to a warming of relations as Paris became more appreciative of the value of strong links with London. As their more realistic colleagues tried to warn them such a rose tinted view would only lead to disappointment, as it duly did later in the autumn during the Straits Crisis. There are however a number of other events that occurred that autumn that we need to consider first.

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Notes:
Look, plot! That's a good thing I'm told.

This is the much delayed US and France falling off gold update, which has been causing them a degree of problems. But it is important not to over-state that, France also had a number of domestic... challenges shall we say while the US problem was more the collapse in global trade and their idiosyncratic approach to trying to re-start it and that hasn't changed. If anything the US has been chucked a bone here and there is no gold confiscation, an OTL FDR measure which yielded very little actual bullion but did a great deal to undermine confidence and the economy (after the silver confiscation and the gold confiscation it was not unreasonable to ask what would be seized next). France has avoided the disasters of the Popular Front, but not addressed the problems the Popular Front were trying to solve so things remain troubled, but that is for later.

The Aga Khan is an interesting figure who we may yet see again in a future sub-continent related update, certainly he was a unique figure who was indeed president of the League General Assembly at this point. And in his religious leader role did indeed get gifted his weight in precious materials at the relevant jubilee, alas the available photos are not the highest quality or I would have gone with the one of him being weighed against gold. While he did love horse racing, Rolls Royces and the finer things in life all the money from the jubilee was apparently spent on various charitable endeavours to benefit the community and outside of that he was a renowned philanthropist.

Gold output did jump massively and by the mid-1930s most of it ended up in London or New York, the exact flows depending on how badly the US economy was doing vs how likely war in Europe looked at that moment. In Butterfly that means its all flowing to London to the extent the Bank of England is starting to get concerned about the stability of the wider global financial system and so are keen to get things stabilised, unlike Paris they are aware that after a certain point vast gold reserves become a problem and not a sign of strength. I think the rest is fairly self explanatory, a factor no doubt of it's length, so I will curtail the excessive notes. I feel confident if I am not correct on that then someone will soon say, hopefully sparking some lively debate.

El Pip · Feb 12, 2023

Supporting Appendix C: The Education of Iron Ore.

To understand the various challenges and crises in the period of this work it is not strictly necessary to understand the difference between high and low grade iron ore and how both were turned into steel. Therefore when those subjects arise the technical background is kept to a minimum in order to keep the main points of the chapter clearer, however this may be unsatisfactory for those who desire more detail or wish to understand why certain problems were so serious or why some solutions were not, or could not be, adopted. It is the purpose of this appendix to provide a more detailed overview of the challenges and technology of the time in order to illuminate such matters.

As with steel making itself we begin with iron ore, at the time it was divided into two broad types; low grade and high grade. A high grade ore would be one that contained 60% or more iron content by weight, whereas a low grade ore could be as little as 20% though more typically was around 30%. One problem with low grade should be immediately apparent, twice as much had to be mined and processed per ton of iron produced compared to a high grade ore. This was a consideration certainly but had to be set against one of the problem of high grade ores; they were comparatively rare. In this period it was only Sweden, French and Spanish North Africa, Chile and British Malaya that exported significant quantities of high grade ore and a select few others, notably the USA and USSR, mined large quantities for their own use. In contrast low grade iron ores such as ironstones and ironsands could be found almost everywhere in large quantities, so the savings in transport and import costs often more than offset the need to use larger quantities, to say nothing of the strategic advantages of have a secure domestic supply. Once you had your source of iron ore it was necessary to mine and transport it to your works, so a brief discussion on location is important. Ideally of course your site would be close to coal, iron and good transport links but geological process being what they are such sites were incredibly rare. Therefore when forced to pick the correct choice in the period was to be close to the iron ore; if you were using low grade ore than a typical works could use four times as much iron ore as coking coal, even with higher grades it would still need two tonnes of iron ore for each ton of coke. For transportation water remained viable and several large works were associated with canal extensions, notably the Reichswerke Herman Goering, but rail connections were generally preferred. Having mined and transported your ore and coal to your works it was then necessary to produce pig iron.

The tapping of a blast furnace to produce pig iron at the start of the 20th Century. The blast furnace is the large structure in the centre of the picture, a hole is opened (tapped) at the bottom and molten iron comes out. It runs along the central channel and into the bays at the side, the layout somewhat resembling piglet suckling on a mother pig and hence the product being named pig iron. While the technology for tapping and collecting pig iron had changed, in many cases it as transferred as molten liquid straight into the steel works, the name had stuck even for material not produced via a blast furnace

Broadly speaking there were two ways to produce pig iron, in a blast furnace and in a rotary kiln. Of those two the blast furnace was by far the more popular at something like 95% of all production because it was simpler, more reliable, cheaper to build and in practice cheaper to run. That kilns kept being tried was because theoretically they could be far cheaper to run in terms of fuel use, the problem was they never quite lived up to that promise when built. The blast furnace was conceptually very simple; iron ore, coking coal and limestone were poured into the top and ignited, hot air was then forced through the furnace. A redox reaction then took place in which the iron oxides in the ore were reduced and the carbon in the coke oxidised, resulting in pure molten iron was tapped off at the bottom as pig iron, while most of the impurities reacted with the limestone to form a slag which floated to the top. A rotary kiln was broadly similar, except it was horizontal not vertical and the rotation was claimed to give great advantages in mixing the material and controlling the reaction and therefore producing the cost savings. Both process produced the same product, a typical pig iron was 90 to 95% pure iron with the balance being the impurities that had not reacted in the blast furnace, however even this relatively small residual was enough to make pig iron a brittle and unreliable material, one that that needed further processing to be useful. Depending on the works the pig iron could be diverted elsewhere, much of it ended up in everything from grey cast iron for water pipes to wrought iron for a decorative gate or forge iron for a car engine foundry. For that which was intended to become steel it was transferred to the next stage, because all the processes involved extreme heat this was the advantage to an integrated iron and steel works; the pig iron could be moved as liquid metal by ladle straight to the steel plant, saving the fuel cost of re-melting it.

Krupp Renn type rotary kilns at an integrated iron and steel works. The kilns are the long tubes running from the large chimney and plant at the rear to the front, they are installed at a slight slope with the input end being higher than the output. All of the various types of rotary kiln operated on the same basis, the iron ore was ground up and poured into one end of the kiln and then heated, as the material moved down the kiln the oxygen and other impurities were driven off. In a standard kiln the material emerged as a range of powders which were passed through a magnetic separator and then sent for sintering to produce material ready for the next step in the process. The Krupp Renn types were more ambitious types and claimed to be capable of lumps of iron ready for being fed into a furnace for steel making, this added capability came at the cost of added complexity and, in practice, severely reduced reliability.

With your pig iron obtained it was necessary to select which steel making process to use and this would depend upon what impurities were in your ore and therefore in your pig iron. It was a two part choice first selecting a process (converter or hearth) and then a lining type (acid or basic), the combination would depend on what pig iron you have made and what quality of steel you wish to produce. The process were conceptually similar, using blasts of air through or over the molten pig iron to oxidise any remaining impurities and remove any excess carbon left over from the blast furnace. In a converter the air was forced in from the bottom and passed through the molten pig iron, the heat of the oxidisation reactions being such that the material remained molten without any external heat and the entire process could take half an hour or less for a 25 tonne charge. In an open hearth furnace the pig iron was placed on the hearth and externally heated hot air was instead passed over the top of the pig iron to achieve the same effect. While the capacities could be larger, anything from 200 to 600 tonnes, the times were longer and 10 to 14hours was typical. With the hearths being slower and requiring additional fuel the question should be why was anyone using it? The answer was control, a converter was too quick for the analysis techniques of the period, so it was impossible to know what grade of steel you would get until you had the final product. The slower hearth process allowed time for analysis and adjustments to be made, it also allowed more control so a more homogenous material could be produced. Broadly speaking then for average quality steel in bulk, for structural or naval usage for instance, converter steel was good enough and so generally dominated due to it's lower cost. Where higher quality or a more homogenous product was required, in tooling steel or armour plate, then open hearth steel was preferred. An open hearth process could also make much better use of scrap and this could close much of the cost gap with converter steel when prices were scrap prices were reasonable.

An electric arc furnace being opened up ready to receive the next charge of material, the furnace being the large cylinder in the top centre with the gouts of flame emerging. As one would guess the electric arc furnace generated it's heat via electrical arcing, large electrodes were mounted in the lid of the furnace and the electricity arced between them and the metal in the furnace, generating intense heat and melting the metal. Very much a low capacity niche endeavour it was the most controllable process and the only one capable of running entirely on scrap, which again allowed finer control of the final steel alloy. As such the few steelworks that used electric arc furnaces tended towards specialist alloys, for instance the Brymbo works in North Wales supplied Rolls Royce with many of the high performance alloys needed for their aero-engines. The technology itself also found use in other industries, the furnaces used to produce calcium carbonate used essentially the same sort of reactors.

The choice of lining type reflected what particular impurity you were most concerned with, if you had mostly silica then you could go with an acidic lining (typically sand or clay) and if you combined that with a converter then you had the moderately well known Bessemer converter. Unfortunately many iron ores regardless of grade were associated with relatively large amounts of phosphorous and thus required a flux material to remove them from the pig iron. If you added a flux, such as limestone, to a Bessemer converter you would end up with a basic slag, which by simple chemistry would react with the acidic lining and not only damage the converter but also release the phosphorous back in the molten pig iron. The obvious solution would be to use a basic lining to the convert, this was done and was the basic Bessemer convert or the Thomas converter after it's inventor. Bessemer had however preferred an acidic lining for a reason and the basic process had slightly higher iron losses and needed re-lining more frequently, so an acidic process was used if possible. It was broadly similar for the open hearth, save for the problem that even with a basic lining the process struggled to remove significant amounts of phosphorous. Thus in the period there was something of a divide between continental steel works (which had been built on the basis of French phosphoric iron ores from Lorraine) that used the basic Bessemer process and the British works which preferred the more controllable open hearth process and generally had low phosphorous ores so could use acidic linings. Of course there were exceptions on both sides, the process used by an ironworks was adjusted to suit certain ores and so every permutation found a use somewhere to deal with a particular ore to produce a certain type of steel.

To come back around to iron ore all of these processes, furnaces and plants assumed a certain maximum level of silicate. There were some impurities no amount of processing could remove, or at least not reliably or economically, and so were deemed just impractical for steel making or in extreme cases even iron making. This is why the Corby Process was so widely noticed, the Northamptonshire ores it used had long been deemed unsuitable for iron making let along steel. They were high in alumina and so required a very temperature furnace (which was expensive in coal), aggressive character (so the refractory linings needed replacing) and had a high silica content which could not easily be driven off. Technically a works could just about make cast iron out of it, but it was expensive and the product highly variable making it a poor commercial proposition, while the residual silica content was too high to even think about making steel. The Corby Process solved all of these problems by adding a moderate amount of Soda Ash to the blast furnace, this changed the characteristics of the slag formed to be both thinner (so not requiring the extreme heat) and to be more attractive to silica (making the final product viable for steel). The savings in time and cost were considerable, but the main advantage was the reliability and consistency of the output. While the exact Corby Process was somewhat unique to the Northamptonshire ores it dealt with, it's influence was more in showing that high silica, low grade iron ores could produce high grade steel and do so efficiently.

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Notes:
Honestly this is far too dry, however I did promise to explain the Corby Process so here we are. In recompense I am double tapping, so onwards to the next chapter which has actual plot.

As I've come this far I will just add that much of the discussion about 'low grade' changed spectacularly in the late 20th century. Ironstones and ironsands just stopped being mined and everyone imported high grade ores from Australia, Brazil, Canada, etc. Hence in modern terms low grade ore now means 50% to 55% Fe content mined in India or Iran, and it's basically unsellable to anyone bar domestic customers because no-one wants the bother.

As has been mentioned in the thread, post WW2 cheap pure oxygen became a thing and so Basic Oxygen Steelmaking became the dominant tech. Interestingly Bessemer wanted to use that but couldn't find anyway to get enough pure oxygen in the 19th century, so modern BOS is basically a modified Bessemer converter. The blast furnace however remains unchanged, fundamentally you need to turn a lot of iron oxide into iron and no-one has found a better economic reducing agent so far.

El Pip · Feb 12, 2023

Chapter CLVI: The Iron Laws of Supply and Demand.

Kipling's Baron would have you believe that it is Iron, Cold Iron, that is master of them all and much of the world in this period would have broadly agreed with his assertion. There were of course many other claimants to the title, ranging from oil and King Coal through to more esoteric choices such as sulphuric acid or indeed the various carbides we have discussed in previous chapters. Yet as we have also seen a large scale integrated iron and steel works was seen by most ambitious leaders as an unarguable sign of modernity and being at least a major regional power. While many of those leaders, or their successors, would find out they had confused cause and effect on this point (building a large steel works did not make you a great power, you could support a large steel works because you were already a great power) the general idea that iron and steel production was a reasonable proxy for industrial strength and military potential remained widely believed. This in large part explains why politicians and policy makers of all stripes across the world had long since decided that the iron and steel industry was too strategically important to be left to market forces and so had assembled a host of industry syndicates and state backed international cartels to 'control' the industry. At the top of this pile was the International Steel Cartel which oversaw a carefully constructed system of quotas, tariffs and market share divisions all designed to solve the problem of severe over-capacity that had plagued the industry in the 1920s. Unsurprisingly therefore the cartel leadership proved utterly incapable of promptly or even coherently dealing with the problem of a shortage, their fumbled response turned what should have been a moderate disruption in the balance of supply and demand in the iron and steel industry into the great pig iron shortage of 1937.

A very high level understanding of the iron and steel process is necessary to understand the crisis, to oversimplify iron ore is converted to pig iron in a blast furnace, it is the combined with scrap metal and turned into steel in a converter or a hearth furnace. Those who desire a more detailed explanation of the processes and challenges of the industry will find it in Appendix C, but this explanation will suffice for the purposes of this chapter. Suitably informed it is sufficient to say that the steel industry was caught in a pincer between rising demand for steel and falling availability of raw materials. Specifically there was a shortage of scrap metal, or at least a shortage of scrap at prices the steelworks were prepared to pay, and so the steelworks had increased the pig iron to scrap ratio in their furnaces and it was this which caused the noticeable shortage of pig iron. As has been implied this was a fairly standard problem of supply and demand and in fact it mostly took care of itself; more pig iron capacity was commissioned and the higher scrap prices encouraged more scrap onto the market. Incidents such as these would not normally detain us, a great many other commodities would experience similar temporary imbalances and shortages as the world economy continued to recover throughout the 1930s. However because of the fumbled and ponderous response of the cartel global steel output was disrupted for several months and, because steel output was considered so strategically and politically important, several nations resorted to quite drastic measures to ensure they would never be in a similar situation again. These measures would take on a diplomatic and strategic life of their own with the consequences being felt long after the iron and steel industries had returned to normal, as such they are worth of our attention.

The blast furnaces of Stewart & Lloyd's iron and steel works at Corby. The tall structures on the left are four of the blast furnaces, the associated silo like structures on the right are the stoves that pre-heated the air that was blasted into the furnaces. One of the largest and most modern works in the UK the large number of rail tracks and trucks in the foreground testament to the works prodigious output and vast demand for raw materials. Despite it's large size the works were originally intended to be far larger, however political concerns about the impact on the wider industry and especially the existing works in the Special Areas forced the plans to be scaled back. During the crisis the matter was raised again as it was suggested the additional capacity come from new works in the Special Areas, but such plans would be far slower and require government subsidy. Instead permission was given for Stewart & LLoyd to significantly expand the Corby works to almost it's original proposed size, including a large number of additional blast furnaces to more than triple pig iron production at the site.

We begin in Germany where steel production had been a matter of considerable concern even before the pig iron supply problems. The factories of the Reich had a seemingly insatiable appetite for steel, not just to meet the ambitious rearmament plans but for the large domestic building programme and for the exports (or barter deals) necessary to pay for German imports. This was a problem as Germany was deeply dependent on imports of high grade iron ore, around 2/3rds of the ore used was imported and of those imports a quarter came from France and a full half from Sweden. Efforts to increase supply from those sources had not gone well, increased dependence on France was politically unfavoured and, after the Rhineland Crisis had shown France was not quite as pliable as believed, strategically risky. Increased supplies from Sweden were preferred but hit the problem of finding items of sufficient value to barter for them, along with the iron ore large amounts of scrap metal and other vital items such as ball bearings all needed paying for and there was precious little that Sweden wanted that Germany was prepared, or even able, to export in sufficiently large quantities. In this context the failure of Junkers to win the Swedish bomber contract was a serious blow as those funds had been earmarked to pay for a host of Swedish imports. Other sources such as Luxembourg were looked at but could not provide sufficient quantity to make a difference, while the great hope of Spanish North Africa was dashed when the Monarchist council agreed with the British proposal to keep mineral sales a private, if heavily taxed, matter. With the German agents in Spain only really authorised for governmental level bartering, and with what they could offer severely limited by the Reich's re-armament plans, they unsurprisingly lost out to the bids of the British steel firms and their hard currency offers. The German government's solution was to accelerate the Four Year Plan and it's push for self sufficiency in iron and steel production, specifically it was the success of the Corby Works in the UK that inspired them to look at using their own previously dismissed low grade iron ores. The resulting facility was the truly massive Reichswerke Herman Goering, named after Goering in his capacity as Reich Plenipotentiary for the Four Year Plan, located near the Salzgritter ore deposits and connected by canal to the coal mines of the Ruhr valley. With the order to accelerate the plans it was necessary to increase the processing capacity as the planned Lurgi rotary kilns would not be able to process enough ore and here we come to the first serious impact. Looking around for options it was noted that Krupp were seeking a licence to export a large number of their Krupp-Renn rotary kilns to Manchuria, the Japanese also being keen to increase the use of domestic low grade iron ores in their puppet state. The economic ministries were looking favourably on the proposal as it would help the balance of payment with Manchuria, after the Soya Beans for Machinery deal negotiated earlier in the year they had to export something. However for Goering this appeared to be a guns or butter decision and there was no doubt where he came on that scale, so the order was cancelled and the machinery diverted to the Reichswerke.

The Showa Steel Works in Manchuria, the first incarnation of the works began operation in 1918 but by the 1930s it had become one of the show-pieces of the Japanese 'modernisation' of Manchukuo. When the works were re-organised and re-named in honour of the emperor it was, of course, the Japanese emperor that was honoured and not the Manchukuo emperor, a clear sign of who actually held power and respect in Manchuria. The works were fed by a mix of local low grade ore and imported high grade ore from Malaya, Australia and the Philippines, in an effort to reduce that dependency and use entirely domestic ores a purchasing mission had been dispatched to Germany to acquire both machinery and licences for processing low grade and highly siliceous iron ores. While the German ore kilns were theoretically capable of doing this, given the great difficulties faced by the Reichswerke in getting their kilns to work reliably there is an argument that the export ban was overall positive for the Japanese steel industry, though it was of course not seen that way in Tokyo.

This naturally leads us to the Far East where this was not the only way in which the situation had not developed to the advantage of the Japanese iron and steel industry. As in Germany the clique in charge of the Japanese government had decided to prioritise both increased production and increased self-sufficiency and these had formed part of the Five Year plan. In respect of steel the plan had two main parts, increasing domestic production and securing control of overseas supplies. The first we have briefly discussed in Chapter CXXXIX, the Manchurian Heavy Industrial Development Corporation was tasked with developing the low grade iron ores of Manchuria and upgrading the steel works to both use these ores and to increase production. To this end a delegation had been sent to Germany to acquire technology and equipment, specifically technology that could process low grade iron ores along with an initial batch of such equipment. It was these orders that had been cancelled, a decision which while not entirely unexpected was still something of a shock that Germany would renege on a deal. Indeed there was an increasing view in Tokyo that this was part of a pattern of behaviour and that Germany was prioritising relationships with China and Britain over those with Japan, this was an entirely correct deduction on the part of the Japanese foreign ministry and the diversion of the order was another heavy blow to already damaged relations. Worse was to follow as the other branch of the plan, the effort to secure overseas supplies of high grade iron ore, also suffered a severe setback from an entirely different source. Japan's traditional iron ore suppliers were British Malaya and the Philippines, the former was already at full capacity and the US government were vetoing efforts of Japanese firms to expand in the latter, not for any diplomatic or strategic reason but due to simple protectionism. Japan therefore looked to it's other main supplier Australia, having long imported large quantities from the 'Iron Knob' deposits of South Australia they turned their eyes to the west of the country and the ore reserves there. Acting through a proxy the Nippon Mining corporation had acquired at lease at Yampi Sound in the north west of the country and intended to mine a million tonnes a year of very high grade ore for export to Japan. It should be noted the project had been in trouble prior to the crisis, the decision to use only US mining equipment and imported Japanese engineers and labourers appears almost calculated to upset the state and federal governments, but it was during the pig iron shortage that the final blow was dealt. The catalyst was one of the seemingly least accurate reports ever written, the Woolnough report, in which the government's geotechnical advisor reviewed the known iron ore reserves of Australia and declared they were barely sufficient for the country's industrial ambitions. Of course in hindsight this is ridiculously incorrect as Western Australia alone has 1/3rd of the world's total iron ore reserves, but at the time it was sufficient to justify the Yampi Sound project being terminated and an embargo declared on iron ore exports. This was a double blow to Tokyo as it left their supplies lower than they had been before the Yampi Sound project started, unsurprisingly it further soured relations with Canberra which were already poor due to the ongoing trade dispute over wool exports. Worse was to follow as the proxy agents for the mine had placed orders and started works, so were desperate not to be left out of pocket when Japan pulled the plug. As such they stared to hustle and managed to drum up enough interest in Canberra and the City of London to put together an 'All Empire' consortium and float a new mining company to take over the lease. This was partly a bet on Australian industrial growth soon requiring the ore but in the short term it was also a security measure to secure the UK's supply; the closure of the Mediterranean during the Abyssinian War had cut off supplies from French North Africa and it was clear the Baltic route to Sweden was just as vulnerable. Western Australia may have been much further away, but the only chokepoints it passed were British controlled and therefore it was deemed a 'safe' source. The distinction that ore being sent to the UK, or as it transpired the mills of British India, was not an export as it stayed within the British Empire did not impress anyone in Japan and was another sore point to add to the bitterness over British involvement in China. There was a growing view in more excitable Japanese circles that Britain was 'interfering' in the Far East and were the largest single barrier to the region coming into the Japanese sphere of influence. While many spoke of the honour and prestige that would come from removing British influence from the Far East, the more convincing voices noted that such a move would also leave the oil and mineral wealth of South East Asia open for Japan to control. In the aftermath of the ore export ban, when it was shown that even owning the company and the mine was not sufficient to make a foreign source 'secure', this was a particularly strong argument.

The Sri Medan Iron Mine in Johor State, one of the Unfederated Malay States that, along with the Federated Malay States and the Crown Colony of the Straits Settlement, made up British Malaya. Sri Medan had opened in 1921 and was owned by the Japanese Ishihara Sangyo Koshi company who exported all of it's output back to Japan. In the era of the Anglo-Japanese Alliance this had been an entirely acceptable proposition, particularly as Britain had no particular need for Malay iron ore for it's own use. As relations with Japan deteriorated concerns were raised, however the Unfederated Malay States were British protectorates and not colonies so only had a British 'advisor' rather than the more powerful 'chief minister' who effectively ran the Federated Malay States. Of course in extremis London could have imposed any change they wished if they were prepared to expend the time and political capital, however the situation was not judged to be so serious as to justify the damaged relations and diplomatic problems that would result from forcing the issue. The answer to why Johor was so keen on the mines was simple; recognising Japanese desperation iron ore exports attracted a high level of duty, over twice that levied on tin or rubber exports, making the mines a valuable source of revenue for the sultan.

Finally we turn to London where the lack of response to the crisis was itself the reaction with long lasting consequences. This was not the masterly inactivity of the civil service nor an unexpected outbreak of free market policy, it was instead the result of the tangled policy web the government had managed to trap itself in on the subject of steel. Government intervention into the industry had been broad and far reaching, running from tariffs and quotas through to forced mergers and threats to the banking industry to ensure only certain new works or expansion projects could find funding. Due to the complete lack of a central industrial policy each of these interventions had left behind a board, committee or other lobby group, all of which felt they should have considerable influence on the next intervention. Thus during the pig iron shortage the government had to contend with the Import Duties Advisory Committee (mostly consumers arguing for lowered tariffs on imports to relive the shortage), the British Iron & Steel Federation (the producers group arguing for more local production), the Steel Cartel (insisting the tariffs on non-cartel states were kept high), the Imperial Trade Council (which was trying to co-ordinate any tariff changes with the Dominions) and the Bankers' Industrial Development Corporation (the Bank of England body used to 'manage' finance for the industry which was concerned the existing works remained viable and able to pay their debts). To this could be added the Board of Trade, Foreign Office, Dominion Office and of course the Treasury who all had a view on what should happen to tariffs and where, or if, imports should come from, to say nothing of the large number of individual MPs arguing for policies that would help their specific constituencies. A particular example would be the Wearside MPs concerned about the shutting of a rivet factory in Sunderland, allegedly due to cheap foreign steel imports undercutting them. In reality the works were shutting due to the massive increase in welding causing a collapse in demand for rivets, but this pointed to another problem; welding required different types and grades of steel, so all the carefully calibrated tariffs and quotas of the cartel were no longer appropriate. Finally there was the devaluation of the Gold Bloc, suddenly a large numbers of previously struggling continental producers were suddenly very competitive due to their much weaker currencies, which again significantly disrupted the market.

Ebbw Vale Iron, Steel and Tin works from the north of the valley looking down towards the works. The owners of the works, the Richard Thomas Company, had intended to build the works in Lincolnshire near a rich supply of ironstone and an existing iron & steel cluster they could benefit from and supply. However due to industry and government pressure they had been unable to obtain finance and were instead forced to build the works in South Wales, one of the Special Areas that had been hit hardest by the Depression. Unfortunately the valleys of South Wales had terrible transportation links and the local supply network, such as still existed, was based around coal mining and so off almost no use to a large steel and tin works. While the works itself was large and modern, having one of the first continuous strip mills in the UK, and it's chosen market was buoyant due to the ever increasing demand for tinned goods, it would forever be fighting against a location that was generously described as 'hopeless'

On the specific problem a response was eventually cobbled together; the Bank of England relaxed it's financing restrictions so money flowed into new pig iron capacity (almost all outside of the Special Areas) and the import quotas were expanded resulting in extra imports of now cheap pig iron from recently de-valued Belgium. These measures, along with some extra pig iron imports from India, mostly resolved the crisis until scrap supplies caught up with the higher prices and demand. In the aftermath the question of how to avoid the problem reoccurring occupied a great many minds, one popular solution championed by the opposition was that the government had not intervened enough. Both Labour and the Liberal Social Democrats claimed the need for a Department of Steel, under a powerful Ministry for Industry, that could replace many of the forest of bodies and intervene before a crisis occurred, the difference being Labour assumed this would be by managing the entirely nationalised industry while the LSDs thought heavy control of a mostly private industry would suffice. The latter of those views also found favour among the wetter side and indeed more paternalistic parts of the Conservative party, if steel was too important to be left to the market then interventions and management should be done properly. Ominously for Conservative party unity an alternative view was developing, one which noted that most of the measures implemented were in fact un-doing previous interventions or relaxing restrictions that had stopped the market correcting itself. There was also the matter of Ebbw Vale steelworks which for those opposed to more active intervention was becoming their go to example of the limitations and problems of doing so. Forced into a poor location by government pressure the works had been in trouble from the start, construction running wildly over-budget due to the poor ground conditions and, portentously, the high cost of transporting everything to site. Once finally operational the advantage of the modern and efficient plant was not sufficient to the lack of a trained workforce or offset the cost of having to import all the raw materials and then ship the product out to distant markets. Having already been bailed out once during construction, the crisis forced a second bailout as much of the works were idle due to lack of raw materials. For the growing anti-intervention faction the works were fast becoming an embarrassment and worse there was no prospect of things improving. While there were proposals to somewhat alleviate the transport problems they were likely to be very expensive and could not overcome the fundamental problem that the works were in the wrong place, distant from both the needed raw materials and their key markets. For many therefore the correct lesson to draw was not to intervene harder and sooner, but more gently and with caution and overall with a lot more deference to the advice and warnings of industry. It was correctly thought that the steel industry would not be the last high profile and 'strategic' industry to encounter difficulties and so the political battlelines over the response to the next crisis were already being drawn even before it was known quite what the specific problem would be.

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Notes:
A double tap of updates, one of which features plot! And Steel. Mostly steel I admit, but also some plot advancement.

The bones of this are OTL, there were a great many cartels and federations, there was a pig iron shortage for much of 1937, the Reichswerke Herman Goering absolutely was a thing (it would grow and grow throughout the war as more looted industries were added) as was the Japanese mission to Germany and their overseas mines. However we are reaching the point were the ripples from earlier changes and starting to make waves and cause changes, thus plot is occurring.

Germany did in OTL source a lot of iron from Spanish North Africa, just under 2 million tonnes a year in 1938 and would have increased further but for the British blockade. In Butterfly that is not an option so it is even more urgent to make use of local ore, hence seizing the Japanese equipment orders. Would Goering be that brutal to Japan, I think so given the situation. He was always more in favour of the German-Chinese alliance and with no Sino-Japanese War and no Anti-Cominten Pact industrial reality is over-riding ideological gestures, not least because von Ribbentrop has been sidelined and Hitler fundamentally didn't care about the Far East but was very interested in having lots of steel.

Yampi Sound was an OTL Japanese effort as was the Australian iron ore ban and the Woolnough report. In fairness to Woolnough a reserve is only a reserve if you can economically mine it and get it to market for less than the selling price, in 1930s Australia transport costs were such that most of the iron ore in the country probably wasn't viable to mine. I have brought forward the iron ore export ban by 9 months or so, but with Australia far more advanced in its industrialisation plans that seemed reasonable. OTL the mine project lapsed when Japan pulled out but restarted post-war so it was viable. Canberra is allowing the project to go ahead as they expect/hope that it will soon divert it's output to the growing Australian steel industry and trust that an Anglo-Australian owned company would be happy to do that in the way a Japanese company would not. The Malay iron ore mines and the reasoning is OTL and a reminder that the British Empire was a mess of colonies, protectorates and other variations of which London had equally variable influence and control.

The ridiculous mass of bodies is mostly OTL, there is one addition the Imperial Trade Council, but the rest could and did ask for entirely contradictory things in the OTL shortage. The MPs concerned about a rivet factory did of course happen, as did the terrible reasoning behind Ebbw Vale and it's regular financial problems. The Conservative splits mostly got papered over as foreign affairs dominated and then there was a war, but they did exist and in the absence of other distractions will become more serious.

El Pip · Jul 2, 2023

Chapter CLVII: Moving at the Speed of Empire.

In the early 1930s the Empire Marketing Board produced a poster encouraging the public to buy British products on the basis of speed, as at that time a number of high profile world speed records were in British hands. The exact connexion between the nationality of the world water speed record holder and the nationality of the bacon producer one should purchase from remains a mystery to all but the marketing men involved in the poster, and perhaps even to them, but it does highlight that speed was seen as desirable and something to be proud of. In the years subsequent to that poster the various records had changed hands and by the autumn of 1937 not all were still held by Britain. The reactions, or lack of reaction, to those changes provide a useful perspective on the priorities of the various arms and branches of the British government.

The poster itself. At the top the Supermarine S.6B of Schneider Trophy winning fame which had gone on to capture the air speed record, being the first aircraft to break the 400mph barrier. The water speed record craft handily has it's name printed on the hull, this particular record had been set on Lake Garda when Anglo-Italian relations had been if not warm then at least cordial. The land speed record is one of the Campbell family's seemingly endless Blue Birds, this particular one being the Campbell-Napier-Railton Blue Bird that set the record on Daytona Beach in the US. Finally we come to the odd one out as it is not the absolute speed record holder, the clue being that the record is given as a time and distance not a speed. As the rail absolute speed record was somewhat murky the marketers instead highlighted a record that definitely was in British hands, the fastest scheduled train service. The Great Western Railway's 'Cheltenham Flyer' averaged a shade over 80mph on the run from Swindon into Paddington station, a testament both to the Castle-class locomotives and the quality of Brunel's track. While not as visceral as an absolute speed record it was in some ways the more challenging achievement; It is one thing to briefly maintain a high speed over a measured mile, quite another to sustain high speed over 77 miles while pulling several hundred tonnes of coaches and then to keep doing so day after day in regular service.

The land speed record section is the simplest to deal with as the record remained in British hands, indeed still in Sir Malcolm Campbell's hands, and his latest land-based Blue Bird had taken the record to 301mph in March 1935. The future prospects also looked good in the Autumn of 1937 with George Eyston's Thunderbolt and John Cobb's Railton Special preparing to starting a new all-British rivalry that would push the record to 350mph and beyond. The general public retained a deep interest and sense of pride in these records and the rivalries behind them, something the government attempted to capitalise on by handing out honours to the various drivers as a way to express the appreciation of the nation and no doubt to try and get some of the glamour and success to rub off. In truth political and governmental involvement was limited to turning a blind eye to quite where certain ex-RAF aero-engines ended up, the record holding Blue Bird and Thunderbolt used Rolls Royce 'R' engines that had previously been used by the RAF to win the Schneider Trophy. It would be untrue to say that government decided to continue a policy of masterfully inactivity on the subject, because that would imply any official attention was paid to the subject at all, beyond thoughts on how best to associate themselves with the successes of course. The railway record was superficially similar, while the record had advanced somewhat to a shade over 80mph it remained with the GWR as no other railway had the combination of engine, track route and commercial need for such a fast scheduled service. Looking at the pure speed side in early 1934 the London and North Eastern Railway had hooked a dynamo car up to their A3-class Flying Scotsman and recorded the first unarguable 100mph in a train, while looking ahead there was another Speed War brewing on the London to Scotland run. Both the London and North Eastern Railway and London Midland and Scottish developing ever faster engines, the following year would see the Empire Exhibition in Glasgow and both companies wished to be the 'fastest to Scotland', in the pursuit of this more records would be broken. However these records would be for the fastest steam-locomotive, the absolute record sat in Germany with the Reichsbahn's diesel-electric powered Class SVT 137s, with the Italian State Railway's purely electric ETR-200 soon to overtake it. It should be emphasised the British rail companies were working on diesel railcars and other experiments and the Southern Railways had a rolling electrification programme across their region, however the emergence of diesel and electric trains as serious options on the prestige 'express' runs and not just for light commuter work would still come as an unpleasant shock. Being a strategic industry by any definition the government was paying more attention to the railways, however it was very much results orientated rather than concerned with the details. To the extent government had a view it would be a strategic and economic one, diesel had to be imported and coal (or electricity generated from coal) did not, so steam on the long runs and electrification in the south ticked that box. However it must be emphasised that it would never have crossed the minds of anyone in government to take the rail companies to task about the subject, certain over-excitable MPs from coal-mining districts excluded. The government did have concerns about the railways that it would intervene on, but these were generally in terms of regulation or competition not operational detail. In the autumn of 1937 there two significant exceptions, both of which were live matters of concern that were threatening to require direct intervention.

A Fiat Littorina diesel railcar outside Tripoli station, note the distinctive square grille and fasces on the nose and the fact it looks like a streched bus with railway wheels attached, which it essentially was. The new Libyan government was converting the railways from the inaccurately named Italian 1m gauge (which was neither 1m wide nor technically even a gauge) to standard gauge, as part of the grand Tripoli-Cairo-Basra railway project. As a result the de-fascesed Littorina railcars would be shipped to East Africa where they could run on the narrow gauge lines in Ethiopia and Somalia. With Egypt thriving under the regency of Queen Fawzia the Egyptian section was also progressing rapidly, so the first Tripoli to Cairo train would run by the end of the year. The section through Palestine and the Trans-Jordan mandate would prove far trickier.

The most broadly held railway concern in government was rail links in the Empire. The Tripoli-Cairo-Basra railway was seen as something of a questionable idea as it was unclear where the traffic would come from to fund it in the long term, but as it was being almost entirely paid for by the local rules in Libya, Egypt and Iraq and using British designers, contractors and suppliers it was not a cause for particular immediate concern. The Cape-to-Cairo railway was a different matter, historically politics and diplomacy had prevented serious discussion and even when the end of the Great War mean an 'all red' route could be plotted the idea had been successfully suppressed. Post-Abyssinia however the subject had resurfaced as everyone had been reminded of the difficulty of moving anything about in-land Africa. The problem, from the civil service perspective, was that the gap sections were mostly in British East Africa, in crown colonies that would expect Britain to pay as there was no hope of them doing so themselves. Under the Austen Chamberlain administration the idea of such a grand Imperial project had at least raised a degree of interest, it being understood that such a thing was done for grand strategic reasons or just prestige rather than any more tangible benefit. However the success of the various 'air bridges' between Cairo and Johannesburg during the South Africa Incident and the now well established Imperial Airways routes were seen to show that the existing transport links worked well enough. It was therefore no surprise that in the autumn the project was ceremoniously booted to a Royal Commission on Trans-Continental Rail Transport in Africa, effectively killing it off until well after the next general election. That is not to say Eden was against grand projects, he had the same desire to 'make his mark' as any politician, however his focus would be elsewhere and he saw little benefit in a money pit infrastructure project in Africa. The other group in Whitehall who were paying close attention to the railways at this time was, of all people, the War Office. This was not out of strategic concern about how they would move around the country, this was mostly a solved issue and there was a standing committee between the army and railways that kept on top of the matter. The War Office interest was in the engineering capacity and capabilities of the railways, with only one dedicated tank factory in the country (the Elswick works owned by Vickers-Armstrong) any serious tank production would require mobilising the locomotive works, as had happened during the Abyssinian War. After that conflict the War Office had hoped to convince at least one of those firms to carry on as a peace time tank factory, or at least a shadow factory, but had been disappointed. While the ongoing A9 and A10 orders had been honoured the three works that had converted to tank production (Birmingham Railway Carriage and Wagon Company, Metropolitan-Cammell Carriage and Wagon Company and Harland and Wolff) all indicated they would be returning to railway work, as they had a full civilian order book and no real faith the army had budget to continue large scale tank orders. The choice by H&W was particularly disappointing as pre-war their locomotive division had been a fairly small scale affair and Belfast had been struggling due to the still ongoing Anglo-Irish trade dispute, unfortunately for the War Office the Admiralty had moved first with it's decision to order two of the Unicorn-class light carriers from H&W, this both ticked the regional support box for the government and pulled in most of H&W's engineering capability. The War Office had been reduced to keeping tabs on the trends in locomotive construction and production, as an example the enforced switch to welding due to the boilermakers influenced the requirements in the A14 spec; the design had to match the capabilities of the expected manufacturers. While this was a positive change it was still one that had been imposed, where the other services could make a considered choice or even drive development through their contracts and specifications, the War Office had to work with what was available. That this reflected the army's position at the bottom of the defence priority list was true but not something the War Office had to be happy about.

The Silver City Comet at Sydney Central station on a test run in late 1937. A diesel passenger rail car she was the first air condition train to run in Australia, eventually successfully operating on the Broken Hill line in New South Wales. While the chassis' of the power units were built in Australia by the government railway works, the engines were Harland & Wolff 'Harlandic' diesel units imported from Belfast. It was orders such as these both from inside and outside the Empire that convinced H&W management to stick with their nascent locomotive and engine works rather than gamble on the War Office actually having the budget to back it's armoured aspirations. Many of these engine and locomotive orders used equipment that had been brought to fulfil the 'war emergency' A10 cruiser tank orders and the War Office did manage to keep them earmarked for future armoured orders in a similar emergency. In the short term however the government was happy to see the equipment used to boost the local economy in Belfast and earn export orders, regardless of what the army may have preferred.

Turning to the water record the success of Miss England II had been temporary as she was just one part of an ongoing rivalry between the US and the UK. This culminated in the Miss America X taking the record in late 1932, after which the two sides were spent and the record spent the next few years in American hands. The good news from the British perspective was that when Sir Malcolm Campbell had abandoned land speed records it was in order to concentrate on water, thus he was making a new effort to reclaim the record, unsurprisingly his craft was called Blue Bird K3, and equally unsurprisingly it used a Rolls Royce 'R' engine. This new craft would reclaim the record for Britain in September and then take the record up to 130mph in August of the following year, his later Blue Bird K4 would take the record to 141mph before the end of the decade. As on land there was great public interest in this, doubtless heightened by the shear danger of the attempts; across the 20th century just over half of the people who attempted to break the world water speed record would die in the attempt. Political involvement was just as limited as on land, but across the wider government a degree of attention was paid to the subject. The Royal Navy, and perhaps unexpectedly the Royal Air Force, had an interest in small fast boats and in the nature of such things the designers who worked on world record boats also produced more standard power boats. The continued existence of the Marine Branch of the RAF remained an irritant to almost everyone who wasn't in the Air Ministry, however the various sea planes that the RAF operated did need a range of tenders and launches to support them and thus the branch was grudgingly tolerated. It should be noted that the Admiralty maintained the position that the aerial vehicles in question were in fact flying boats so it would be neater to just transfer them all, along with the rest of Coastal Command and the Marine Branch, to the Royal Navy. At this point however the Air Ministry was in the ascendant and was in the process of expanding it's flotillas with new High Speed Launches for air-sea rescue, it being long established that they had the duty and responsibility to recover the crew when an aircraft ditched into the sea. After a series of disasters where their existing launches had proved too slow to react, and with the knowledge larger aircraft with more crew were coming, the new launches were intended to be not only faster but also larger than those that had come before. To the annoyance of almost everyone involved these craft proved to be remarkably similar to the new MTBs (Motor Torpedo Boats) that the Admiralty were procuring as part of their plans for the defence of overseas harbours, which we shall be looking at in later chapters. That the designs were similar should not have been a surprise as the only significant difference was the payload; stretchers and a medical bay for the rescue launches verses a pair of large torpedoes and some light machine guns for the MTBs. Under the skin is where we find our interest for these craft required very high performance engines and these were not items that the UK had in abundance. As discussed in Supporting Appendix A if you wished for maximum performance from an engine you would look for a water cooled in-line engine, which in practice meant looking at aero-engines or at least units derived from an aero-engine.

The Bird-class high speed range clearance launch Kestrel, at the time of the photograph on service in Ceylon and based out of Colombo. As one should expect from the name the job of these vessels was to keep commercial shipping out of the area during coastal defence battery live firing exercises. It was therefore somewhat logical that, as (most) coastal defence guns fell under the Army's control, these vessels were brought and operated by the War Office. Fortunately for all involved the British Army had an even more relaxed definition of 'high speed' and was content with 18knots, that being more than sufficient to chase around after typically far slower merchant vessels.

The fastest of the many craft the Admiralty were testing, Vosper's MTB 102, used three Isotta Fraschini 183 engines, with an unusual W-18 layout these were fully marinised 1,100 horse power units that could push MTB 102 up to almost 50knots in testing. However as the name suggests they were Italian and so utterly unavailable, even if the Italian government had been willing to allow an export licence to a British firm (which was very unlikely post-Abyssinia) all engine production was being retained for Italy's own re-building and re-armament efforts. As a backup the Admiralty had approached Rolls Royce about getting a marinised Merlin, given their experience with fitting the 'R' to the world water record boats this was seen as straightforward enough, however it was rapidly objected to by both the Air Ministry and more seriously the Committee for Imperial Defence (CID). Having recently acquired the role of mediating such disputes the CID decreed that as Rolls Royce were already badly over-stretched they could not be distracted with yet another project, also ruling out the option of marinising another less in demand Rolls Royce engine. The RAF Marine Branch were not doing much better, as they had a more relaxed definition of High Speed (36 knots in trials being entirely acceptable) they only required half the power from their engines and so theoretically had a wider choice. The initial preference had been a marinised Napier Lion engine, somewhat predictably called the Sea Lion, however the Alvis-Napier merger had severely disrupted supply. The RAF Technical Branch was strongly arguing that the last thing they wanted was for the new Alvis-Napier to waste it's time on restarting production of a 20year old Great War era engine when they should be working on the next generation of engines for actual aircraft. Recognising the force of that argument, and very much agreeing that aircraft should be the priority over boats, the Air Ministry moved onto their backup choice of the Thornycroft RY 12. Being an entirely marine engine and built by the engine arm of an actual shipbuilder this should have been fine. However the potential of the RY 12 had already been noticed by others, specifically the Army who had specified it in their A14 Tank project. The A14 was a project and the Marine Branch had actual orders, so in any fight the RAF would probably prevail but it would be a fight and one that would doubtless escalate up to the CID. As the issue was studied it became clear that the prize may not be worth the fight, while the RY 12 was slightly more powerful than a Sea Lion it was massively larger, to the point barely two could be fitted in the same space as three Sea Lions. While the Marine Branch was more relaxed about speed that didn't mean it was prepared to accept a 'high speed' launch that couldn't reach 30 knots. It was therefore grudgingly recognised that the Air Ministry and Admiralty had a common interest in finding a solution and that if they did not voluntarily co-operate they risked it being imposed on them by the CID, or worse the Ministry of Defence Co-ordination.

The hydroplane Empire Day I under tow on Lake Windermere in the autumn of 1937, piloted by it's co-designer Edward Spurr. Even allowing for the great public interest in something as exciting and dangerous as a water world record attempt the event was incredibly well attended and covered by the press, no doubt because of the identity of the other designer; Thomas Edward Shaw or, as he was more famously known, Lawrence of Arabia. While still busy in Palestine Shaw had remained involved in the project and was at Windermere for the attempt, it is telling that there were as many people in government hoping he would stay in the UK as desired his rapid return to Jerusalem. Empire Day I did not break the absolute record and would have to be substantially rebuilt before her next attempt, neither she nor any other water speed record receive any official support. The problems facing the power boats were not a lack of cutting edge design, but those of industrial logistic and engineering capacity, hardly things a world record attempt could assist with.

Thus we come to the final record on the poster, the Supermarine S.6B and the world air speed record. This had not stayed in British hands for long before the Machhi M.C.72 had reclaimed the record for Italy and raised the record up to 440mph. The government however had disbanded the RAF's High Speed Flight after winning the Schneider Trophy and the Air Ministry did not consider the matter serious enough to warrant reviving it, a stance that seemed justified by continued success in various air races in the following years. By the autumn of 1937 this had changed with Germany claiming the landplane speed record with a specially modified Bf 109 that reached 379mph on it's final runs, for comparison the Spitfire Mk.I could reach just over 360mph and this was at it's full throttle altitude, an air record had to be set at 245ft or lower and at that altitude a Spitfire struggled to do even 300mph. To their credit the Air Ministry managed not to panic about this as they rationalised that the record breaking German effort would have used a special engine, been unarmed and generally heavily modified, all of which was true. It was felt that a record breaking effort of their own was justified, not particularly for prestige reasons as the Italians still held the absolute record, but to support another leap in aircraft and engine technology. The Schneider Trophy efforts had resulted in the development of the Rolls Royce 'R' engine, which had itself led to the Merlin, significant advances in fuel technology which had born fruit in the development of BAM 100 high octane fuel and a great deal of aerodynamic advances which had influenced the Spitfire and had been copied by firms outside Supermarine. In the context of the Air Council focusing it's efforts on Fighter Command and strategic air defence there was great value in aircraft that could climb and fly faster, the further from London the enemy was intercepted the more time there was to shoot them down, indeed with a fast enough fighter and enough warning from the RDF it was hoped to be able to credibly defend the Channel ports from hostile bombers with more than just anti-aircraft guns. The lessons from the air war in Spain should also be acknowledged, the 'observers' and liaisons had confirmed that while skill, training and tactics were all very important, there was a great deal to be said for just flying a considerably faster aircraft than your opponent. The decision was therefore made to reform the High Speed Flight and make an attempt at the world air speed record, the only one of the four record attempts on the poster that would receive government support and funding. In part this was because the water and land records were somewhat parasitic, they did not develop new technologies but adapted ones that had been developed elsewhere, not least the Rolls Royce 'R' engine. The main reason though was that the air speed record was the most directly applicable to a vital strategic concern of the government and where it was new technology that was required not more production industrial capacity. In the short term the Air Council approved development of a Speed Spitfire, a lightened and de-armed Spitfire with a specially tuned Merlin was felt to be capable of taking the landplane record and re-building the High Speed Flight organisation and industrial links. To target the absolute record something more would be required and the key to that effort would be the engine, as the Air Ministry reviewed it's portfolio of upcoming engines, and started to grapple with high powered marine engine requirement discussed above, it became apparent a review and reshuffling of their engine plans would be required. This would be the first major review since the 'co-operation' agreement with the Admiralty over engine development and with the CID looming over the process as a far from neutral adjudicator with it's own concerns about engine development. This review and it's consequences will be the subject of our next chapter.

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Notes:
I may have written a tad more than I intended about that poster, but I like to think it's all relevant to the Butterfly Universe and even includes some plot nuggets. It is perhaps longer than really required.

Lawrence of Arabia remains not dead in Butterfly and did OTL work on both Empire Day and the RAF Marine Branch launches. All of the services liked having branches that transgressed onto the other's domain. The RAF had the Marine Branch and it's Armoured Car Companies (eventually the RAF Regiment), the Royal Navy had the Fleet Air Arm and Royal Marines, the Army had it's launches and it's balloon (eventually the Army Air Corp). On which note it remains a trope of this work that most defence co-ordination will be carried out under the threat, real or imagined, of the Minister for Co-ordination of Defence getting involved and not because of the actual efforts of that department. In contrast the Committee of Imperial Defence will continue to accumulate duties precisely because it is not particularly political.

To put some detail on the changes scattered through this. On water the Italian W-18 engines were available right up until Italy declared war, US Packard engines were also more acceptable substitutes. The marinised 'Sea Merlin' engine did get put in a couple of MTBs before being killed as a waste of Merlins needed elsewhere, here it is killed a bit earlier as RR are even busier. The Admiralty did like the idea of MTBs for overseas defence, we will look at that properly in the port/docks update sometime in... 2025... ?

Rail in the Empire was never much of a concern in OTL, the Libya railway was obviously impossible and Egypt was too unstable (and the leadership too corrupt) to care much about infrastructure and Britain didn't want to waste influence changing that. Equally no-one outside die-hard Imperialists even talked about Cape-to-Cairo, it remains a very expensive and not wildly useful idea so had been booted into the long grass.

Italian 1000mm railway is exceptionally Italian. It isn't technically a gauge, as gauge measures inside edge of rail to inside edge (because rail track sizes vary) whereas the Italians decided to measure between the centre of the rails. As a result while the track is 1000mm between rail centres, it is about about 950mm from inside edge to inside edge so should be called 950mm gauge. The practical consequence of this is that it is a bit rough running as the actual gauge varies with the tolerances of the rail, which is not ideal for smoothness.

The Speed Spitfire did exist, but was fairly low priority and got overtaken by events. Here it will be rushed, not least due to the reformed High Speed Flight which never happened in OTL, so will at least make an attempt. If it works is of course a different matter. And on that note we have a thrilling inter-service (and intra-service) row about engine development in prospect, which I hope you are all looking forward to as much as I am.

El Pip · Sep 30, 2023

Chapter CLVIII: A Sacrifice for the Son of Jupiter.

The immediate priority in the Air Ministry's review of it's engine portfolio was the Speed Spitfire project, the aircraft in question would be powered by a heavily boosted and exotically fuelled Merlin II engine. The challenge was formidable as the world landplane record was held by a heavily modified Messerschmitt Bf 109 powered by a 33L Daimler Benz 601R engine, as the Merlin was only 27L displacement the British engineers were starting at a considerable disadvantage. The combined Rolls Royce/Royal Aeronautics Establishment (RAE) team would manage to brief coax over 2,100hp out of the record attempt engine, double what the standard Merlin II of the time could manage, and just in excess of what was believed to be required to take the record. The team did note that that their work to get to 2,000hp+ would have been a lot easier had they been starting with a larger engine and this chimed with a broad trend the Air Ministry technical section had observed, the growing tendency to use clever engineering instead of raw size to achieve an increase in engine power. On it's own terms this approach had worked, comparing the engines in the 'standard' fighter version of the Spitfire and Bf 109 the power outputs were broadly similar despite the disparity in displacement. Within the industry this had been viewed with a degree of pride, clever engineering producing equal results to brute size, while the civil service viewed the whole thing as a matter for the engine manufacturers; the Air Ministry approach had been to specify the power output required and any special requirements, but leave how that was achieved up to the engine designers. The increased importance attached to speed meant there was a growing view that while using clever engineering to match the output of a larger engine was a fine achievement, starting with a larger engine and then applying that same ingenuity would produce engines that out-performed rather than merely matched their foreign rivals. This did not mean the Air Ministry would start interfering with details such as displacement or engine size, they would instead revise their expectations of what was possible and start requiring larger power outputs from future engines. This new perspective would very much inform how the Ministry approached the rest of the engine review and the decisions they made.

The Speed Spitfire in flight over the RAE airfield at Farnborough, the bold 'lightning strike' design visible though sadly the vivid blue colour is not. The world air speed record had to be set at low level, indeed the course had to be no higher than 75m above sea level, and at that altitude a standard Spitfire Mk.I could manage a shade under 300mph in ideal conditions. The Speed Spitfire had double the engine power of the Mk.I, a host of aerodynamic tweaks and a low level optimised 4 bladed propeller, yet the design team were only aiming at just over 400mph. This was a reflection of the harsh realities of drag and speed, all else being equal to double an aircraft's speed did not require double the horsepower, it required eight times the power. These diminishing returns on increased power were another reason the Air Ministry was keen to look at ever more powerful engines.

The review began with Rolls Royce who had no less than seven aero engines under some degree of development or production, along with various other engine related endeavours. This was not quite as bad as it seemed as the engines could be grouped into two main design families and there was a large degree of commonality between the members of each group. The 'bird of prey' family were all liquid cooled inlines and could all trace their lineage back to Kestrel, the mainstay of the RAF in the late 20s and early 30s and still in production for training aircraft. The other members were Peregrine, which was a modernised Kestrel, Vulture, which was graphically described as 'two Peregrines performing an unnatural act in close formation' (it was two V-12 Peregrines bolted onto a common crankshaft to form an X-24 engine), the well known Merlin, and finally the enlarged version of Merlin tentatively named Griffon. The other family was the air-cooled X-shape inlines, both named after rivers and both being developed for the Fleet Air Arm, the Exe and it's still entirely on-paper enlarged version the Tamar. While there had already been efforts to reduce the burden on Rolls Royce by banning them from the marine engine market the considered view of the Technical Department was that this was still a very heavy work load, particularly given the deadlines from the wider aircraft development programme. The Merlin was the engine for Fighter Command's two main fighters as well as several upcoming prototypes for other specifications, in addition the Committee for Imperial Defence (CID) were very quick to make clear that the Dominion Merlin work was a non-negotiable priority on political and diplomatic grounds. With the Air Ministry having just decided that larger and more powerful engines were a good idea Griffon was also safe, while Vulture was one of the specified engines for next generation of fighters and bombers so was also deemed very important. This left Peregrine which, at a mere 900hp at that point, was the least powerful and so a prime candidate for cutting as there were plenty of other engines in that power band, however as a Vulture was two Peregrines combined together much of the development work on Vulture would benefit Peregrine as a side-effect and vice-versa, so the actual savings in time and effort from a cancellation would be minimal. Moreover Peregrine was the preferred engine for the Westland entry to the F.37/35 cannon fighter spec, the P.9 used two Peregrines so the actual installed power would be more than competitive. As Fighter Command were very keen to see a high performance cannon armed fighter in service, and as the Westland design was seen as the lower risk of the two proposals selected for prototyping, this was another good reason to keep the Peregrine under development.

With a grim sense of inevitability the Fleet Air Arm representatives recognised this meant it was one of their engines which was being eyed up for the chopping block. The Griffon was technically an FAA design, or at least they had asked for it before the RAF had thought of it, but the Exe and Tamar were arguably the first modern British aero-engines that had been designed just for naval use. Naturally the FAA did not want to give them up and the Admiralty was prepared to put it's full weight behind ensuring that it got it's way. Their starting point was suggesting that the Air Ministry had been looking at things the wrong way, rather than shrinking the workload to fit Rolls Royce's capacity, surely they should be encouraging an increase in that capacity. Given the tendency of all the armed services to try and throw most engine problems at the firm this would beneficial to all involved and hopefully reduce the need for such brutal decisions in the future. While a reasonable seeming suggestion it was sadly not that simple, not least because Rolls Royce were already trying to expand but so were a host of other engineering firms to meet the rise in military and civilian orders, all of them drawing from the same pool of specialist workers. The general staff shortage was particularly acute for design work, while a new welder or production line worker could be trained up in a few weeks or months an engineering draughtsman needed a five year apprenticeship and a fully qualified design engineer took even longer to educate and train. As any expansion to the training pipeline would not bear fruit until the early 1940s it was a particularly short term solution and indeed the long time lag raised another serious issue; was a far larger industry design capacity sustainable? The current spending was 'Re-armament' which amongst other things implied it was a limited exercise, once the armed forces were in an undefined 're-armed' state then things would return to an equally unclear 'normal' spending level, all of this assuming a future government did not just cancel the scheme. The Air Ministry, and indeed the Admiralty, had spent the 1920s and early 30s carefully protecting design capacity in the face of government spending cuts and so were understandably sceptical about diverting funds from current needs to invest in future capability if it could all end up being cut at the next election. While the issue was 'kicked up stairs' to the CID in the vain hope it might prompt some political action in the short term it was accepted design capacity was a constraint and plans would have to be made accordingly. The main counter-argument from the Air Ministry was that the Exe was not really required, it had a similar power output to the Merlin and so the FAA could just use Merlin instead of an Exe in their upcoming specification. As the FAA believed the inherent damage resistance of an air-cooled engine was important for carrier aircraft, to say nothing of the advantages in not having to include large radiator intakes, this was rejected, the option of delaying Tamar was equally unacceptable as they too could see larger higher power engines would be needed in the future. With neither side willing to compromise, and Rolls Royce management unwilling to upset it's key customers by just refusing work, it appeared the decision was to tolerate over-loading the Rolls Royce design teams with target dates and deadlines pushed back accordingly.

A Rolls Royce Exe on the test stand at Hucknall Aerodrome, home of the Rolls Royce Flight Test Establishment. The starkest example of the trend for clever design and not increasing size could be found in the progression from the Kestrel to the Exe, both had a 22L displacement but power had over doubled from 450hp in the first Kestrel to a shade under 1,000hp in the prototype Exe. There were three main ways to increase power without increasing displacement, higher rpm, higher boost and sleeve valves, and the Exe successfully combined all three. To add to the almost showing off feel of the design Arthur Rowledge had also implemented a novel low-drag air cooling method and done so without any significant issues or any of the panic of the cooling crisis which had hit other firms. The main criticism of the Exe initially was it's power, there were no shortage of 1,000 hp engines and aircraft would soon be needing far more power to remain competitive, but this was not a problem with the design per se but a reflection of the limited ambition of the FAA who had specified it. They had asked for a 1,000hp engine in the smallest package practical and that was what they got, they were fortunate that thanks to hard work and the designers skill the Exe would eventually be developed into a 1,500hp unit, one which could provide the level of power the FAA required.

The deadlock was broken through the slightly unexpected intervention of the Ministry of Defence Co-ordination (MoDC), unexpected because it was mostly received well by the services, at least initially. The MoDC probably had the broadest view of the various projects underway of any group in Whitehall or Westminster, while the CID had a better knowledge of highly classified projects or anything with Dominion interfaces they tended to avoid the details and while the Treasury theoretically knew all, they also tended not to ask about details beyond the price or impact on the economy. As a result it was the MoDC that noticed the potential in Kestrel to both solve a number of disparate problems and to lighten the load on Rolls Royce. As discussed previously Kestrel had been the preferred engine for much of the 1920s and as a result the RAF had a very large number in stock, taken from all the biplanes hastily being pulled from service. Recognising most of those engines were still fairly new the Air Staff has planned not to procure new Kestrel engines for the next generation of training aircraft, but instead to refit the old engines to a new standard. The MoDC had also seen the request for high powered marine engines, while not challenging the decision on ruling out Merlin they did suggest that a marinised Kestrel engine would fit the power and size requirements of both the RAF High Speed Launches and the Admiralty's motor torpedo boats. They also pointed out that the marinisation could be done by a different firm, provided there were a steady supply of base engines to work on. On the land side it was known that after the A9 Tank trials where the Phantom II car engine had failed Rolls Royce had been looking at tank engine supply, while the Army was expecting the next generation of tanks needing a large jump in engine power. An un-supercharged Kestrel engine, even on the much lower octane Army Pool Petrol, would produce around 500hp and so be well within the range the Army was looking at. As final flourish the MoDC suggested to the CID that Kestrel could be the ideal engine for the next generation of aircraft to be offered to Spain, even in de-tuned training-spec it was still a 720hp engine which was a vast improvement over the less than 500hp Wolseley Libra in the Spanish Venom, while being a last generation engine it minimised the risk of modern technology leaking out. Apart from the RAF trainer engines all of these were fairly small projects requiring from a few dozen to just over a hundred engines, nowhere near the quantity to justify a major scheme. As a job lot they were almost the definition of unsuitable for standard mass production as they had very different details and fittings despite the common engine block, crankshaft and other key parts, so the line would be constantly changing to switch between versions. However they were a good fit for a Woollard style approach, particularly if it could be done in a purpose built shadow factory, which was something that could be justified by the total number of all the required variants. Therefore if all the Kestrel work were passed over to a different firm, including the marinisation and land variant development, then Rolls Royce could shut down their Kestrel team and stop investigating tank engine options, freeing up resources for their aero-engine projects and reducing the over-load on their design teams.

While all of this was attractive the killer argument was that such a new factory could pull in funding from a range of non-defence budget sources, especially if it were built in a Special Area, to the point it would be virtually 'free' for the services. A new facility in a Special Area would also gain them plenty of political brownie points for pushing investment towards politically convenient areas and lower the pressure on the other suppliers to relocate their factories. A decent sized production run and minimal capital costs to cover also meant the various Kestrels would be cheap, even after allowing for a reasonable licence fee to Rolls Royce for the design and tooling. The MoDC also had an answer for the short term engine needs, proposing the use of the stocks of decommissioned Kestrels from the RAF and FAA be used for limited rate low volume production while the shadow factory was brought into full production. As was becoming traditional the MoDC attempted to push it's luck and take control of the endeavour, arguing that a scheme that crossed all three services and had foreign export considerations was the very definition of one that needed defence co-ordination. Equally traditionally the Admiralty, War Office and Air Ministry united to resist this bureaucratic empire building, correctly believing the MoDC had the long term aim to wedge itself into defence procurement and so refusing to set a precedent, indeed the service chiefs themselves had a common aim to see MoDC abolished with it's co-ordination duties passed to the Committee for Imperial Defence, which at least had service representatives on it rather than just politicians and civil servants. With that particular round of bureaucratic infighting complete it was easily agreed to proceed with the plan and that the new factory fit within the Air Ministry's existing Shadow Factory Scheme. The chosen technical partner was Henry Meadows Ltd, a moderately sized manufacturer of engines and gearboxes that crucially also had experience of producing marine engines. After a somewhat dispiriting review of the options within the Special Areas, and a number of very serious meetings about whether the extra cost (both financial and political) of going to a traditional site was actually a price worth paying, the location selected was Newcastle. The factory would in some ways be a shadow facility to the existing Vickers works at Elswick, as this would aid in developing the tank engine variant and allow a bit of cross-pollination between the experience Vickers works and the new factory being laid out on Woollardist lines. True to the MoDC's predictions the endeavour did attract a great deal of interest from the various development and investment bodies; the Special Area Commissioners approved the full range of allowances and exemptions, the Treasury approved the necessary grants and the still relatively new British Investment Finance and Industrial Development Corporation was keen to prove it's strategic worth by under-writing it's first defence scheme. Ground would be broken that autumn and by the spring of 1938 the first batches of new build Kestrels would be leaving the factory surrounded by a clamour of politicians keen to take the credit and show off a high profile investment in the North East. Somewhat less well publicised was the low rate production of engines underway in Henry Meadows Wolverhampton factory, these engines would make their way to the various Motor Torpedo Boats, High Speed Launches and Tank prototypes under development in the rest of the country.

The last Ford Model A Van rolling off the production line at Trafford Park, Greater Manchester, in 1931. Such was Ford's reputation and lingering association with the idea of mass production that there were regular calls for the firm to be involved in the Shadow Scheme and the Trafford Park site, which had lain abandoned since 1931, was often touted as a facility that should be modernised and brought back into use. While the site had been tentatively identified as a potential Rolls Royce shadow factory no real progress had been made, in part because Rolls Royce already had two other engine factories under development (Crewe and Glasgow) and given the revised fighter-focused production plans that was predicted to be sufficient. The other part was Ford itself, with Ford US having decided to back the Republicans in the Spanish Civil War relations between Ford senior management and the British government were somewhat awkward. More seriously after the Fordson tractor debacle and Ford UK's ongoing struggles with profitability there were real concerns about long term viability of any scheme. The decision to pursue the more flexible Woollardist approach was the final nail, asking Ford to abandon the manufacturing approach they had pioneered and indeed named would hardly be well received.

There is one other matter to cover before moving on from Rolls Royce, the Phoenix sprint engine. Engine design is normally a matter of balancing various factors; power, size, complexity, efficiency and so on. The sprint engine is the answer to the question "What if you don't care about fuel efficiency?" The concept had come from the Tizard Committee's considerations of aerial defence, at the time it was thought that a defending fighter didn't really need much range but desperately needed maximum power to allow it to climb to altitude, therefore the committee proposed producing a 'sprint' engine that was optimised for short range interceptors. The key feature of such an engine would be the choice of the powerful but wasteful 2-stroke cycle rather than the far more efficient 4-stroke cycle of almost every other aero-engine. Development work began under Harry Ricardo and the concept soon grew in complexity and ambition; sleeve valves, liquid cooling, stratified charge, direct fuel injection, vortex supercharging and exhaust turbine energy recovery were all included in the 'ideal' engine layout. The final concept for the engine was not just one of the most advanced 2-stroke aero engine ever attempted, it was arguably one of the most advanced aero engines of any type. In terms of the Air Ministry portfolio the design slotted in as both speculative and as a backup, not to any other piston engine but to the possible failure of RDF development. RDF had pushed back the warning times and made fighter defence practical, however if advances in bomber speed and height outpaced improvements in the range of RDF then it was feared the situation would change once again and warning times start to decrease. In that scenario have a high powered sprint engine uncompromisingly designed for a raid climbing and interception could be invaluable in keeping fighter defence viable. The original plan had been to hand this immense technical challenge to Rolls Royce for development, however this hit the objections of the CID and indeed parts of the Air Staff about overload and other priorities. After a great deal of wrangling the engine ended up with Alvis-Napier, at least for the single cylinder testing and development phase. The combined company had the facilities from Alvis' brand new factory and technically capable staff from Napier, with Ricardo and his company providing additional specialist support, the question therefore was whether the company had the organisation and ability to utilise those resources, as such the project was also something of a test of the new company. As was standard it was the design firm who named the engine and the choice of the name Phoenix was officially because Alvis-Napier had chosen 'mythical creatures' as the theme for this family of engines, however it is hard not to miss the symbolism of the choice.

Finally we turn to Bristol, who had reason to be somewhat confident about the review. The massive investment in sleeve valves was finally paying off, while the cooling crisis and the problems of their rival radial makers had only highlighted their technical prowess in mostly avoiding such issues. In terms of range they had six engines in production or development, the two poppet valve radials Mercury and Pegasus, and the four sleeve valve radials Perseus, Taurus, Hercules and Centaurus. There had already been a degree of trimming of the range, the Air Ministry culling the far too small Aquila sleeve valve to allow Bristol to concentrate production efforts on the larger engines. Development wise Bristol had hoped to stop work on the 'legacy' poppet valve Mercury and Pegasus, however much of the current generation of RAF aircraft had been designed around them, not least the Bristol Blenheim (which had an entire network of Shadow Factories dedicated to it) and the Vickers Wellington (which was at that time a linchpin of British and Dominion medium bomber plans). As we have seen both engines were getting an upgrade to make full use of 100 Octane fuel, their future development beyond that would be tied to decisions about the high priority, and high profile, aircraft which used them. Turning to the sleeve valves the Perseus had ended up a mainstay of the Fleet Air Arm, powering the Blackburn Skua and the prototype Gloster Griffon, with the Admiralty even considering replacing the engines in the Fairey Swordfish with Perseus to get everything on a common engine and simplify logistics. The Perseus had also been included in a number of RAF specifications for land planes and this gave it a large enough user base that it would also need upgrading to 100 octane fuel. The Air Ministry was concerned at this surprisingly large workload, particularly when they moved to look at the larger engines. The enormous 18 cylinder Centaurus was at least still a mostly paper design as Bristol were focusing on the nominally 1,000hp Taurus and it's larger brother the 1,300hp Hercules. Both were 14 cylinder twin row engines and in theory the main difference was the larger cylinder size on the Hercules, giving it a larger displacement and so more power than it's smaller sibling. In practice there were considerable differences in detail and layout, crucially Hercules was based on the standard cylinder size Bristol had been using since the 1920s while Taurus had a new bespoke cylinder size. This seemingly small difference, and some unfortunate clamp design choices, had made Taurus' development prolonged and unproductive, yet it remained Bristol's priority as the board believed in developing the lower powered engine first. This misunderstanding of the Air Ministry's views was quickly corrected, the Hercules was either first or backup choice in most of the submissions for the next generation of medium and heavy bomber, in contrast the Taurus had not yet even been listed as an approved option for specification. If that were not enough the Air Ministry technical section considered the Taurus as too little, too late; there were already several 1,000hp engines available (Merlin, Dagger, Exe and Sabretooth) at various stages of maturity, so there seemed little point in developing yet another similar sized engine, particularly one which was not even reliably passing type testing.

An Armstrong Siddeley Tiger Mk.VIII being fitted to a Whitley heavy bomber. Bomber Command had originally intended to fit the more powerful Merlin engines to the later marks of Whitley, however they had been over-ruled by the Air Council who prioritised the equipment of Fighter Command. Knowing Bomber Command still wanted more powerful engines on the Whitley the new management at Armstrong Siddeley proposed a further development of the Tiger, dubbed the Sabretooth Tiger (as they were truly running out of big cat names), with a central bearing and various other minor improvements. The first Sabretooth would come out at 1,100hp, almost entirely due to the increase in rpm that the central bearing allowed, which was a significant improvement on the Tiger Mk.VIII but nothing particularly special. The advantage to the relatively simple nature of the changes was that it would take only a few months to go from suggestion to the engine starting type testing and then into the next production batch of Whitley bombers. The Air Ministry took this as further reassurance both that they were adequately stocked with 1,000hp odd engines and that the changes to Armstrong Siddeley were starting to have a positive effect.

The existence of firms beyond Bristol capable of producing an air cooled high power engine was important, not just for the traditional reasons of competition and design variety, but due to some very specific concerns about Bristol at that time. As we have discussed the choice of sleeve valve had been a bold and expensive risk, but which had technically very much paid off. Bristol sleeve valve engines were in front line service with the Fleet Air Arm and on paying service with Imperial Airways, living up to the promise of higher efficiency, better reliability, lower maintenance and lower noise. There was just one small problem; every engine had to be carefully hand finished as they required individually matched cylinders, sleeves and pistons all fettled to fit. The heat treating processes tended to very slightly deform the elements, particularly the sleeves, and the exact deformation was slightly variable. These were small deformations, ovalisation of a few thousands of an inch (0.1 to 0.2 mm) on a 5.75 inch nominal bore cylinder, but this was still enough to ruin an engine unless all the components had the same deformation. For the small volume of engines required so far this had not been a serious issue, as we have seen up to a certain output the fixed costs of mass production outweigh any savings and so small batch craftsman production can be the best option for a run measured in dozens not thousands. Bristol had also been diligently working on adapting the sleeve valve manufacturing process to be suitable for mass production, the problem was they had been working on the issue for several years and up to that point had only demonstrated many dozens of methods that weren't suitable. Given the national importance of the sleeve valve in Air Ministry plans, and the likely requirement to ramp up production of Hercules into the hundreds and possibly thousands, the group working on the problem had been widened to include the steel specialists at Firth-Vickers as well as the alloy team at High Duty Alloys, as a result Bristol's technical team were confident they would soon solve the problem, however they had been confident of solving the problem 'soon' for most of the decade so understandably concerns were still mounting. Taking all this into account it was a fairly easy decision for Air Ministry to kill off Taurus, removing it from the specifications then under draft and directing that Bristol's priorities should be Hercules and finally solving the sleeve valve manufacturing issues. With the engine pipeline re-ordered to their satisfaction, the Air Ministry could turn it's attention to the aircraft that they would hopefully be powering.

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Notes:
I did consider splitting this into two, but it's honestly not that long. Well not by Butterfly standards anyway. In any event it has a title I love dearly and I don't even mind if no-one else bar me gets it.

Those of you familiar with WW2 British aero-engines will hopefully be fascinated by the changes seen, those who have let their studies lapse hopefully found it enjoyable anyway. I tried not to get bogged down in marks and variants of the engines, just to be clear engines generally increased in power during their life as they got developed so nominal power is normally what the first variant produced, even if later ones produced more. As a handy rule of thumb an engine was expected to add ~250/300hp during it's life, some struggled to do that, others smashed it and doubled or more.

The trend towards clever not big engines is not something you see much discussed, yet I would argue it is a serious under-current. The Speed Spitfire project was OTL just too late, the engine was ready nice and early but they had to wait till Spitfire production was well underway before they could 'borrow' one for modification. In Butterfly the rush to get Spitfire into production (and stopping Supermarine building various crap flying boats so they had the capacity) has brought the timetable forward considerably, though at some cost to Coastal Command as we shall see in the next update.

I love the Rolls Royce Exe, it is a tour de force of brilliant engineering. It is also just too small and the best option would have been to kill it, being a X-24 sleeve valve it is fairly resource intensive compared to a 'simple' V12 Merlin, Lord Hives (RR Works manager) reckoned 275 Exe was the production equivalent of 1,200 Merlins. Now he was trying to get Exe killed and Merlin had been optimised for mass production by then in a way Exe hadn't, but even so you have twice the number of cylinders (even if they are smaller) and as mentioned later sleeve valves are more demanding in manufacture. That said I am trying to make plausible mistakes here so Exe lives and the FAA get 'their' engine, even if really they should just be using Merlins.

The many Kestrel variants are mostly things that were discussed, RR did look at Kestrel as a tank engine in 1941 but the Army wanted 600hp+ so they used Merlin instead to make Meteor. The RN asked about Kestrel/Peregrine for their MTBs in 1940 when they lost their Italian supplier, but ended up going with Packard. The RAF trainers used Kestrel Mk.XXX engines, which were older Kestrel blocks from biplanes given a refurb and de-tune, then pushed into service. Meadows did tank engines (*whisper* Covenantor) and the engine performed as promised it was just everything else that was awful, so I felt they deserved to get a good tank for once. We shall see what aircraft the Spanish Kestrel ends up in at some point in the not-too-soon future. The MoDC deserved a little win, even if Macmillan did once again overplay his hand.

OTL Trafford Park ended up a Merlin shadow factory, as befits a Ford factory it took ages to get going but once finally operational produced huge amounts of engines (400 a week at peak) most to chuck into Lancasters and Halifaxes as fast as the airframe could be built, all of them Series 20 as the line was too inflexible to be changed much. Government is no longer planning a tens of thousand strong heavy bomber force, and Ford UK is having a rough time of things as noted, so Trafford Park stays derelict for now.

The Phoenix sprint engine was the RR Crecy in OTL. Another absolute masterpiece of engineering, it was if anything too successful as the few times they looked at fitting a prototype into an aircraft (Spitfire, P-51, Mosquito) they concluded it had far too much power for the airframe to cope with. Overtaken by the jet engine of course and again the hindsight decision is scrap it, but instead the crazy gang at Napier get to play with it while Alvis try to make sure the sane ones focus on Sabre. The A-S Sabretooth Tiger never existed, they were took busy panicking about Deerhound being a disaster, but they have new competent management and honestly had the capability to do a small tweak to an existing engine while working on a new one, all they needed was a decent chief designer which they now have. Plus I like the name and thought A-S deserved a little success as well.

Finally Bristol and the cancellation of Taurus, it was just a horrible problem child for years. I spared us all a discussion of the clamp problems but briefly Taurus had a hairpin maneton clamp which never really worked properly and no other Bristol had that sort of clamp for long and not interesting reasons. As this was the clamp that held the two parts of the crankshaft together, it should be clear why a failure was always catastrophic. Killing Taurus will not really help with getting sleeve valves ready for mass production, that's a materials and finishing issue not a design one, but it will free up people to get Hercules running and de-bugged a fair chunk earlier than OTL, which will please the Air Staff greatly.

El Pip · Nov 18, 2023

Chapter CLIX: A Season for Decisions Part 1.

The realities of aircraft development were such that even if there had their been no changes to the aero engine development plans the RAF Air Staff would still have had many decisions to make in the Autumn of 1937. The development of a new aircraft, particularly a large or ambitious one, was not a quick process and even with the more 'streamlined' approach taken by the Churchill Air Ministry it could still take several years to go from writing the operational requirement to a fully operational squadron. Given the speed of technological advance an aircraft could go from cutting edge to only fit for second line duties in considerably less time than that, consequently it had become standard practice to begin looking at the next generation of aircraft even before the prototypes of the current generation had finished testing, so as to keep a steady stream of 'modern' aircraft entering service. For all that the biggest threat to a design was generally not the advance of technology but the sometimes even faster changes in priorities and strategic thinking both within and without the Air Ministry. The most recent set of defence priorities had been set at the Imperial Defence Conference the previous year, or at least the general ideas had been discussed there and had subsequently been worked over by the Committee of Imperial Defence and turned into some slightly more practical service specific priorities. For the Air Ministry and RAF these were;

• Home defence
• Provision of the aerial component of the expeditionary force
• Support for imperial security and policing missions
• Far Eastern operations

At first reading nothing on that lists seems to require or even suggest that "Build a large fleet of strategic bombers" was an intended priority, yet it was with the bombers that the Air Staff started their work. This was not just the bomber barons taking advantage of the still somewhat vague nature of the priorities, but a reflection that the Air Ministry still saw a significant role for bombers of all types across the priorities. To start with Home Defence while politicians were increasingly seeing that as being a job for fighters and the various Chain Home systems, the deterrent effect of a large bomber fleet was still valued even by those who doubted the 'morale effect' was quite as strong as Bomber Command had claimed. Moving to the next point one of the results of the Chetwode Reforms had been a standing Expeditionary Force, while mostly an Army affair it was intended for the force to have an aerial component for everything from artillery spotting through to air attacks on depots, bridges and similar targets. Much of the detail was still the subject of a three way tussle between the Army, Strike Command and Bomber Command as we shall see in the following chapters, but all agreed that bomber support would be required in some fashion. 'Imperial security' was the latest incarnation of the Air Policing role that the RAF had been carrying out across the Middle East since the early 1920s, most recently in 1934 when they had supported the High Commissioner in Aden and the local pro-British Emir. While not a solution to every problem a squadron of RAF aircraft was a valuable reminder of British power and an efficient way of supporting favoured local rulers and preventing local difficulties becoming problems London had to do something about. This priority was therefore a reminder to the Air Staff not to neglect this mission which was a priority for the Foreign, Colonial and Indian Offices. Finally there was Far Eastern Strategic Operations which perhaps had the widest range of interpretations, politically it had been seen as defence of Singapore through fighters, reconnaissance craft and torpedo bombers to support the fleet and the RAF and Dominion Air Forces had deployed squadrons accordingly. The difference was the Air Staff looked beyond that towards strategic bombing of the Japanese Empire and eventually the Japanese Home Islands themselves, in line with their belief that air power alone could win any war if your just applied enough of it. If the politicians had truly intended this is less than clear, however the CID and Air Ministry could see the value in a credible Far Eastern bomber force if only as a deterrent, so were prepared to let the Air Staff attempt to prove such a thing was possible.

RAF Brize Norton, one of the new training bases built under RAF Expansion Scheme A it was declared operational in the summer of 1937 when No.2 Flying Training School and it's collection of biplane trainers flew in. The distinctive 'ribbed' roofs of the four Type C Hangars are clearly visible as are the other station buildings clustered to the left of them on the picture. What is not visible are any marked runways, instead a faint perimeter road marks the extent of the large grass 'flying field' while the shorter cut grass which marked out the 'runways' are not visible in the photos. A properly levelled and drained grass runway was surprisingly all weather capable, but only if the newly laid grass was given at least three years to properly form its root structure. The various attempts to short cut this process almost uniformly ended poorly, the most notorious example being the 'sinking planes' at Gatwick airport over the winter of 1937/38. Equally relevant for the Air Staff was the fact that a grass runway was far less efficient than a concrete or tarmac one, a bomber that needed 1,500 ft to take off on a grass field would only need 1,000 ft on concrete.

Before looking at the two bomber projects under consideration it is worth understanding the implications and consequences of a key concept that was in both specifications - overloaded launch. As we have seen for much of the 1920s and early 1930s the notional enemy for the RAF was France and ranges were set accordingly, the 1934 specification for the Whitely has been the first where the range had been set with Germany in mind, specifically the target was Berlin. As the plans department and economic warfare department really started studying Germany it was soon noted that while the Ruhr was the economic heart of the country the industry in eastern Germany and Silesia could not be ignored. To hit those targets a 'radius of action' of 700 miles would be needed, adding on the fuel for take off, landing and provision for emergencies and combat this meant a nominal range of 2,000 miles would be required. The issue with achieving such range was weight, more specifically the weight of the loaded bomber at take off and so the required runway length; all else being equal a heavier aircraft will have a higher take off speed and so need a longer runway to reach that speed. With advances in flaps, variable speed propellers and engine power this was considered achievable on a typical grass strip of the time, but anything heavier would require a longer runway than existed at many of the RAF's older Great War era airfields. This was where overload came in, for missions that either required either much longer range or very heavy bomb loads the aircraft would be 'overloaded' with extra fuel and bombs and then launched via a 'frictionless take-off device'. This deliberately vaguely defined device would rapidly accelerate the aircraft to take-off speed in a very short distance and so bypass the runway limitations entirely. In practice the Air Staff expected the device to be a catapult, various iterations of which had been trialled since the 1920s and were in regular use on Royal Navy ships to launch scout planes. Crucially though no firm decision had been made as the Air Staff were concerned with the result not the specific method, while this did leave space for bad ideas such as large flywheels or 'gravity launch' (harness the power produced from dropping large weights down wells) it also meant more useful options could be developed.

Overload had been a pre-Abyssinian War idea and when the Air Staff came to reconsider it in light of the revised post-war defence priorities the situation had changed considerably. With the need to plan for operations in the Far East range had become even more important and as we have seen in-flight refuelling was being investigated as a range-extender, but it was not without it's own drawbacks, not least the large number of tanker aircraft required. The extra range allowed by an overload launch was therefore attractive as it didn't 'waste' any aircraft as tankers. The bad news came from the Royal Aircraft Establishment (RAE) who had been working on the catapult launch option for several years and had produced a preliminary design, the implications of which were unfavourable to say the least. The RAE confirmed that technically a catapult capable of launching a 30tonne aircraft in a very short distance was entirely possible, however it would require a great deal of power (around 8-10,000 HP), a fairly complex rig which would limit cycle time (several minutes per launch, meaning it could take up to an hour to launch a whole bomber squadron) and somewhat ironically a concrete launch track, indeed to allow for wind direction changes several concrete launch tracks. The irony being that part of the motivation for the 'frictionless take-off device' had been to avoid the costs of converting existing grass airfields to concrete or laying new ones. With an estimated cost of around £100,000 per catapult it was still cheaper than building concrete runways, a three runway arrangement with concrete paving was estimated at around £200,000, however the specialists required for the pneumatic systems made it far more challenging to install at overseas bases. The limited cost advantage and the serious operational problems were enough to see the catapult option shelved, though the RAE catapult section would survive by becoming a joint operation with the Admiralty. While the Air Staff hoped this would be a cheap way for the RAF to keep their options open the section soon became entirely focused on ship-borne devices for float planes and hydraulic catapults for aircraft carriers. This was not the end of the overload launch option however, as mentioned the requirement had been non-specific on launch method and in amongst the many bad suggestions there was another far more viable option, RATO - Rocket Assisted Take-Off. RATO had been identified by the RAE as a possibility in a report in early 1936, this was not a particularly insightful conclusion as Germany and the Soviets had been independently testing the use of rockets since the mid 1920s. The principle was exactly as simple as it sounded, rockets were attached to the aircraft and rapidly accelerated it up to take off speed in a very short distance. As the next generation of bombers had been designed for overload it was believed they were already capable of taking the loads imposed by this acceleration, thus the only issue was the rockets themselves. At this point we must once again delve into the world of inter-service rivalry.

The almost incredibly unimpressive cordite filing room at RAF Martlesham Heath, the then home of the Rocket Establishment alongside various other research groups. British rocket research had focused on solid fuelled rockets and had developed a new solvent free form of cordite to power them, unimaginatively called Cordite SC (Solventless Cordite), along with a range of tools and techniques to manufacture the rocket bodies. By late 1937 had produced a fairly powerful 2" diameter rocket and were looking at scaling it up to 3". While far from the most high performance rockets in the world, they were cheap, reliable and optimised for mass production. This was something of a hallmark of all the groups working at Martlesham Heath, a willingness to select a second best approach in the cause of getting something working faster.

The Rocket Establishment had been established to meet Army and Air Force research requirements and so to avoid excessive squabbling fell under the CID, that body had set the original research objectives;

• Anti-aircraft defence
• Long-range attack
• Air-launched weapons

The first was the cheap rocket weapon the Army had hoped would be a more economic alternative to heavy AA guns, long-range attack was the latest iteration of LARYNX which hoped to hit targets several hundred miles distant, while the air-launched weapon project was an idea that had come from the Tizard Committee about the potential for defending fighters to launch barrages of rockets at formations of enemy bombers. Notably absent was any rocket assisted take off idea, not for any technical reason but because at the time of the establishment being started the Air Ministry was focused on catapults and did not see the need. When there has been no functional rockets there had been very little dissent about the order of the priorities as in principle and indeed in practice, the same rocket engine and body could do multiple jobs so the work advanced all the objectives equally. The successful testing of a viable rocket focused minds about which project would get priority for practical implementation and so the RATO work became part of the ongoing inter-service discussions. The starting point was that the Army had a good claim to top priority, just as for the Air Ministry the priorities for the War Office had been set by CID and Home Defence was their top priority for them. As the anti-aircraft rockets were intended to supplement, and perhaps even replace, the existing AA guns assigned to home defence they inherited this priority. If one stuck to the intent of the system then home defence was more important to the cabinet and Westminster than improved bomber performance, thus the Army should win out. Fortunately for the Air Staff the Imperial General Staff were prepared to negotiate the point, not out of any high minded duty but because of the nature of the new rockets. While the prototype 2" rockets had the power and endurance to hit targets at 15,000ft or more the accuracy at that height was terrible, as a result even after making a generous assumption on how cheap a mass produced rocket could be they seemed a less cost effective solution that heavy AA guns. What would make a difference was improving the accuracy of the AA gun predictors, something with the ongoing radar work on the Gun Laying Radar was intended to do. The War Office proposition therefore was that if the Air Ministry's larger and more experienced radar team would provide extra assistance to the Army Cell working on AA radar, then the Army would allow AA rockets to drop down the priority list. The CID soon weighed in to agree that joint radar research was obviously better than many separate siloed teams the Air Ministry agreed the point before something was forced on them. The two ministries agreed that both the air launched rockets and the AA rocket programme would benefit from increased accuracy, so this would be the second priority after RATO for the Rocket Establishment. The long-range attack idea, while enthusiastically endorsed by the Churchill and the Air Council, had become stuck on the issue of control and guidance. It was therefore agreed that the Rocket Establishment could safely ignore work in that area until the control issues had been worked out and there was an actual rock requirement for them to work on.

A Whitely Mk.IV heavy bomber with two RATOG (Rocket Assisted Take Off Gear) pods attached, undergoing trials near Orford Ness. The RATOG pods are the two items outboard of the engines, one on each wing, and consisted of a cluster of rockets bundled together into a steel tube and then fired sequentially to provide extra thrust at take off. As this was a trials aircraft the pods remained attached so the scientists and engineers could study them when the Whitley landed, one of the priorities for the trials flight was to assess what the impact of the pods was on aerodynamic performance and range, to determine if a detachable pod was worth the cost in terms of lost and damaged dropped pods. An early key finding was confirmation that the stresses imposed from a RATO launch were not particularly severe, opening up the possibility of much wider employment of the technique.

A trials unit was soon established at RAF Martlesham Heath, initially with a flight of Armstrong Whitworth Whitley bombers on the basis that they were the nearest in size to the future heavy bombers. Almost inevitably this unit would be joined in the summer of 1938 by one of the first production Vickers Wellington bombers, as the 'Empire Bomber' it would have to operate on everything from Australian dirt strips to frozen fields in the Canadian high north, to say nothing of it's deployments to the Middle and Far East. The RAF (and indeed the RAAF and RCAF) had high hopes that RATO would avoid the need to upgrade and improve quite so many runways to get the maximum range and capacity out of the Wellington. It should be noted that the enthusiastic rush to trial RATO did not mean the issue of concrete vs unpaved runways had been resolved, aside from the range/weight issues it was recognised a concrete runway was more resilient than a grass strip to extremes of weather but that this had to be set against the extra cost. To the distress of the Air Staff the runway debate would soon get dragged into the ongoing airplane vs seaplane battles that were still raging inside, and outside, the Air Ministry, as we shall see in the following chapters. For now it is enough to say that RATO was seen as a way of keeping options open and that overloaded launch remained a valued ability. As we are now hopefully in possession of a better understanding on the priorities of the Air Staff and the Ministry, let us turn our attention to the aircraft themselves.

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Notes:
As is traditional this one somewhat got away from me, but in an interesting way I hope. The priorities are not quite OTL as they do reflect the many change, however aerial policing remains something that much of the government is interested in and doesn't want the RAF to forget about. The RAF operation in 1934 in Aden was an interesting thing as it was (in OTL) the last aerial policing before WW2. The RAF had got the technique refined by then and were operating in support of the High Commissioners negotiations not instead of them, while not phrased that way they were aware of 'minimum use of force' and lots of other counter-insurgency thinking that would get used post-war. I also wonder if it the success also influenced wider RAF thinking as it was mostly the psychological ('morale') impacts of the bombing that did the work, 95% of the bombs dropped were 5lb 'bomblets' that were noisy but basically harmless, with the occasional dropping of larger bombs as a threat.

Catapults and Overload were a key strand of Air Staff thinking, because most of the WW1 era grass runways would struggle to cope with long take offs and the Bomber Boys really wanted to carry big bomb loads to long ranges. In OTL the massive investment in Expansion Air Bases in the East of England provided a large number of much longer runways, though eventually they would have to concrete most of them just to get good all weather performance and to cope with the ever larger weights of the bombers. The 3 years for grass to 'root it' was something that was a well known rule of thumb but often ignored due to pressure to get things operational and was another driver for concrete runways, particularly once you needed bases for the USAAF there just wasn't time. In any event this meant there was no need for catapults as the RAF could just set very long take off lengths, not quite the case in Butterfly though the problems with catapults remain.

The Whitley RATOG tests did happen but that photo is from 1943. There was some earlier work done spring 1941 but that was FAA/Navy driven. That said the 1936 RAE paper is OTL (as is the Germans and Soviets doing it first), however RATO was a very low priority for the rocket research team so very little happened. OTL AA rockets remained the top priority of the rocket team and the date for developing a decent 2" rocket is correct, the change is the deal on changing priorities. In a world where radar is more widely known, if not necessarily more advanced, a gun laying radar solves the Army AA problem far better than cheap inaccurate rockets so this makes sense to me. Also the British armed services may mock each other and disagree over priorities, but they are capable of sometimes co-operating for mutual benefit. Of course when budgets are tight and cuts have to be made, the infighting can reach Imperial Japanese levels.

The long range missile project is surprisingly OTL, as early as 1936 ideas were being sketched out but again at a very low priority. As described guidance and control were the main problems and didn't really get sorted until well in the 1940s, so this stays on the back burner for now while other boffins try to solve the problem. Air launched anti-bomber rockets were also on the 1936 list, but Fighter Command wasn't fussed and there was some doubt about whether the enemy would operate large formations of bombers or use other tactics. Broadly the same here, so again remains a lower priority but still being thought about and poked.

El Pip · Dec 30, 2023

Chapter CLX: A Season for Decisions Part 2.

It is a useful approximation that the process of producing a new aircraft for the RAF ran as follows; operational requirement (what the aircraft had to do); specification (the 'hard numbers' the aircraft had to achieve in terms of size, speed, altitude and so on); competitive tender (the various manufacturers producing designs and mockups); prototype (construction of prototypes of the chosen design or designs); trials (the prototypes being tested to see if they met the specification and what properties they had) and production (order being issued to actually build the selected aircraft). If there were problems with the prototype(s) this could be lengthened by a Development stage where an improved prototype was produced and tested, while if things were urgent the entire prototype stage could be cut and the design 'ordered off the drawing board' on the basis of the tender design, the first production aircraft effectively serving as the prototype and trials aircraft. For our current purposes the two most relevant phases are the production of the requirement and specification documents and the selection for prototyping decision. The importance of the former should be obvious, the operational requirement and the specification were the documents from which everything else flowed, even a 'perfect' design could be an in service failure if it was trying to do the wrong thing. The end of tender stage decision point was also important as it was the point at which the Air Ministry had to pick the best design(s) to order prototypes of or in extreme cases issue a production order. The accusation is sometimes made that if the if the final aircraft was not a success then the Air Ministry had picked the wrong design at this stage, though this does raise the less frequently engaged with question of what best design actually means. Was a design that stuck closely to the specification requirements better or worse than one which excelled in one thing by sacrificing it's performance in other areas? The unsatisfactory answer was generally 'it depends', not just on the specific trade-offs made but on wider strategic thinking, the politician climate and the Air Staff's views on what they though should be possible. It must also be emphasised that even if all the tender submissions had broadly similar projected performance it was not a matter of just picking the one with the biggest numbers. The tender design would have to be turned from paper into metal and it was not unknown for some loss of performance to occur in this process, sometimes due to over-optimistic projections in an effort to win the tender but more often due to design team inexperience or unexpected problems with a new or unfamiliar technology; the Air Ministry often required designers to push the limits of what was possible and sometimes the limits pushed back. The final area of consideration was workloads and the Air Ministry's wider plans, if a company was already committed to other projects that were of greater importance then that could rule out their bid even if it was technically the best. It should be no surprise this was an especially contentious area, requiring as it did agreement on both the 'best' designs in the various specifications and on the relative importance of the various requirements. For completeness is should be acknowledged there were any number of unofficial and indeed officially discouraged factors at work, most notably individual views on the relative merits or demerits of the companies bidding. Given the large number of factors to consider, and to try and dilute the previously mentioned individual prejudices, the decision on which tender to proceed with was made at a formal design review conference. A mix of civilian and military technical specialists would be gathered from the Royal Aircraft Establishment (RAE), Air Staff and Air Ministry to consider the tenders from several perspectives, as was often the case with such gatherings the informal chats during the light refreshments were at least as important as the official agenda items. With an understanding of why and how the tenders were being assessed, let us turn to the actual designs.

We begin in a manner the Air Staff would approve of by looking at the bombers. After the shocks of the summer air defence exercises and the Lindemann Committee's first findings on offensive technology and tactics a reasonable first question could have been if any of the designs should be proceeded with as they had been specified to out-dated thinking. In reality this was never even discussed, on practical level scrapping the designs and starting with a new operational requirement would mean 18 months to 2 years worth of delay, the bulk of that time in the manufacturers producing brand new tender designs. With the comparative rarity of a defence friendly Chancellor in the Treasury the senior ranks in the Air Staff and indeed Air Ministry wished to take full advantage and get squadrons ordered; despite the war emergency orders and a great deal of effort to rush aircraft into service much of Bomber Command was still in biplanes. From the technical perspective it should also be said that many of the recommendations training, navigation, bomb sights etc had very little to do with the actual aircraft or could be easily incorporated by allowing some provision for extra equipment. The exception was bomb size, when area effect had been king the expected bomb load had been large numbers of 500lbs whereas the new approach was looking at fewer but larger bombs to maximise impact and blast. While this emphasis on size not quantity was arguably a change to the specifications, certainly a number of designers would complain they would have done things differently had they known, military aircraft were essentially a monopsony (the government was the only customer) so there was not a great deal the complainers could do. It is sometimes suggested that speed was another change, the importance of a fast cruise to minimise the reaction time available to the enemy air defences was certainly one lesson coming out of the Chain Home exercises. This misses the point that the Air Staff had long wanted faster bombers, indeed they had declared speed to be the most vital defence on a bomber since the early 1930s. The issue was they didn't think it was sufficient as they assumed that bombers would get attacked by enemy fighters, if not on the way to the target then certainly on the way back, at which point they would need defensive guns. In their typical false precision fashion the Air Staff decided on the 80/20 policy, deciding that 80% of the defence of a bomber was it's speed and 20% defensive guns, but that the 20% was vital. That there was almost no basis for these figures beyond assertion, not indeed any way to use them to quantitatively assess design trade-offs and choices, was irrelevant as it was mostly used as a justification to try and kill of the internal debate about unarmed bombers, a subject we shall return to later. For our present purposes the key issue was that the speed and defensive armament were in tension, more specifically speed and turrets were in tension because turrets were almost uniformly terrible for an aircraft's aerodynamics. It was well known that the single easiest way to improve the speed of almost any bomber was to remove it's turrets and smooth over the resulting hole, the resulting reduction in parasitic drag would substantially improve both maximum speed and best economic cruising speed. The Air Staff were well aware of this but as mentioned had no quantitative way of assessing the trade off, the impact on speed (and to an extent fuel consumption and range) of a turret could be worked out to a reasonable accuracy, but the benefits of a turret were entirely situational, depending on how an enemy chose to attack, if the friendly bomber was in formation and so on. It should also be noted that, fittingly for an organisation so concerned with destroying the enemy will to win, much effort was expended on thinking about the impact of turrets on bomber crew morale and if being able to 'fight back' against attacking fighters from all angles would improve their morale and so performance. The net result of all this was a certain amount of indecision, while it was agreed that a nose and tail turret were the absolute minimum necessary for any bomber beyond that there was a tendency for turrets to be added, deleted, moved and generally tinkered with during testing and indeed operational service. The full details can doubtless be found in those books which exhaustively focus on the history of a single type, the relevant point is that the trade off existed and was significant factor in both design and assessment.

A Bristol Blenheim Mk.I in flight during a training exercise, the large glass cage like object on the top just aft of the wings is the dorsal gun turret. While not the subject of any the deliberations the Blenheim was a good example of the performance cost of a turret; the original civilian Type 142 had achieved 307mph but by the time the military version had entered service as the Blenheim Mk.I the top speed was barely 280mph. While there were many adjustments necessary to militarise a plane, the turret alone cost around 15mph and that was in it's 'aerodynamic' retracted position. When fully deployed and actually able to fire the speed impact was even more significant. In exchange for this loss of speed the early Blenheim crews gained the dubious benefit of a single Vickers 'K' .303" machine gun, which perhaps explain why an unarmed bomber was not seen as a particularly radical option.

There were two bomber specifications about which a decision had to be made and a third which was playing the role of the spectre at the feast. Of the two main specifications B.12/36 was officially for a heavy bomber while P.13/36 was a general purpose medium bomber for worldwide use. The latter description was seen as something of an incantation, a ritual phrase the Air Staff used to show the Ministry and other interested groups that they were ticking boxes other than just strategic bombing. This was somewhat undermined by the Air Staff regularly referring to P.13/36 as a 'heavy medium' or 'medium heavy' bomber, indicating that they still viewed the strategic role as the key capability of the design, though in fairness they had included a requirement for the design to be able to carry and launch two torpedoes giving it some multi-role ability. The P.13/36 was specified as twin engined both as a nod to it's 'worldwide use' requirement (fewer engines meant less maintenance and so a small ground crew) and on cost grounds as engines were generally the most expensive single item on an aircraft. Cost was important because the design was intended to equip the majority of the bomber squadrons and so form the bulk of the future main bombing force. The specification had been written when the speed faction were in ascendance so only the minimum nose and tail turrets were specified, though the more experienced designers had wisely made provision for additional turrets to be added. The review process was relatively straightforward, while eight firms had responded to the tender most could rapidly be dismissed. As outlined above this was not always on technical grounds, as an example the Bristol submission was rated highly both on design and practicality, but the company was heavily committed elsewhere and so was deemed unlikely to be able to deliver without sacrifice elsewhere. As a telling example of the position of the Air Ministry and the wider government at the time one of those projects was the civilian Bristol Blackpool airliner; beating back the commercial challenge of US airline manufacturers was rated a comparable priority with rearmament and Bomber Command modernisation. At the other extreme there was the Hawker submission, as it was expected that a company would respond to an Air Ministry request for tender they had put a design in, however as their main focus was the fighter specification it had very much been a bare minimum token effort. In between there was the Fairey submission, a streamlined and well laid out bomber but which was submitted as using the Fairey P.24 Monarch engine, after all the engine rows of the summer the only choice that would have more annoyed the Air Ministry would have been an imported foreign engine, unsurprisingly this was rapidly ruled out. The preferred option was the Avro 679 and this was duly selected for prototyping, this is sometimes seen as a surprising choice given the firm's previous effort the Avro Anson which had been marked for replacement shortly after entering service due to being slow and too short ranged. In fact the Anson was a mark in Avro's favour, because while it's performance was poor it was what Avro had promised in their tender, that said performance was inadequate for the role was the fault of the Air Staff and the specification not the designer who had provided what was asked for. The only point of debate was the 'second string', the backup design that should be pursued in case of issues with the first choice. This was the point where the third specification made it's presence felt and began to influence the decision making process.

The project looming over the discussion was B.1/35, an older specification which most manufacturers had pulled out of as they (and much of the Air Staff) felt it had been superseded by later specification. Only Vickers had persevered and were working on a design that was essentially a larger brother to the Wellington, sharing the same geodesic construction and twin engined layout while being bigger and heavier. The common heritage with the Wellington had been enough to ensure considerable Dominion interest in a 'large Wellington' and this, along, with a reluctance to abandon the work that had been put in so far had been enough to keep the project going. The significant chance had been the switch from Bristol Hercules engines to Rolls Royce Vultures, the increase in engine power being necessary to keep the projected speed acceptable in the face of the ever growing weight of the design. While this switch further increased it's attractiveness to the RCAF and RAAF contingents (swapping 'exotic' Bristol sleeve valves for an line Rolls Royce unit made domestic production, or at least local engineering support, far more feasible) it also further increased the similarities with the favoured P.13/36 designs which also used Vultures. There was therefore a strong argument that B.1/35, which had become politically uncancellable due to the Dominion interest, could serve as the 'second string' design, freeing up money and design capacity for other projects. If nothing else the Air Ministry would need a good argument as to why it needed three very similar sized prototypes, all with the same engines and all intended for the same mission. The argument that emerged was a risk based one, in line with the usual portfolio approach, the need for a non-Vulture engined option to cover the possibility of problems or delays with that engine. At this point there were no major concerns about Vulture, some teething issues had been identified but after the re-organisation of the summer more resources were being deployed and the Air Ministry's Resident Technical Officers in Rolls Royce were confident in the basic design layout, however it was not unknown for issues to occur on seemingly solid engines as the Cooling Crisis had demonstrated. As this was the future mainstay of Bomber Command some insurance was considered wise just in case, so attention turned to the available options. The second place design had been the Handley Page HP.56 and that submission included an alternate engine, sadly it was the Alvis-Napier Sabre which was at an even earlier development stage than Vulture not to mention the ongoing disruption caused by the Alvis-Napier merger, making it an even less certain option. The logical solution was that if two engines were insufficient, then four could be provided, a change which 'only' required new longer and thicker wings and a great deal of internal re-arrangement around controls, fuel lines and similar. The initial preference was for four Rolls Royce Merlins, on the basis of an Air Staff study on expected bomber performance and the fact the Merlin was a proven established engine at this point. Handley Page however managed to get that switched to Bristol Hercules, on the basis of their much stronger experience with fitting and cowling air cooled radials and because the extra power would be needed to offset the increased drag from the larger aircraft. An interesting point would be that the torpedo and catapult requirements were removed at the same time so Handley Page could concentrate on the design of what was in many respects a new aircraft. That a specification that called for a twin engined medium bomber with torpedo capability would result in a design for a four engined effectively heavy bomber getting approved for prototyping did attract a degree of comment, however the reasoning was sound and at least at this stage the Air Staff did have a large amount of latitude to exercise their professional judgement. Once there were actually flying prototypes to look at there would be more pointed questions from the politicians to answer.

The Supermarine drawing office in their newly refurbished Woolston works in Southampton. The 1930s were a transition time for aircraft design, twenty years earlier the teams were often less than ten people and much of the design process was not codified but relied upon the experience and engineering judgement of the chief designer while twenty years later and teams were hundreds or even thousands strong, the first commercially useful computers were available and the firmer theoretical understanding of aerodynamics and stress meant design was far less of a black art. The late 30s had design teams in the dozen, had some analytical methods to assess stress and from wind tunnel testing a solid but far from complete understanding of aerodynamics. As a result much of the chief designers contribution in this period was marshalling and combining the work of the team rather than detailing every part; a vital job but not an irreplaceable one, or so the Air Ministry hoped.

A naive observer might expect that as the P.13/36 specification had resulted in a four engined bomber being ordered for prototype this might impact the assessment of the B.12/36 specification, which was also for a four engined heavy bomber. This sort of thinking cut no ice with the Air Staff who had the reasonable defence that the two specifications were for substantially different aircraft, not least the fact that B.12/36 required double the bomb load. The resulting aircraft were intended to serve in a small number of squadrons who's wartime role would be to hit targets either at long range or that required a very large bomb load be dropped; the specified overloaded launch capacity was 14,000lb of bombs, a shade over 6 tons. A more meaningful comparison is perhaps the fact that a fully fuelled and loaded Bristol Blenheim light bomber only weighed 14,500lb, however measured the required bomb carrying capacity was truly immense. The designs also all had a ventral or dorsal turret in addition to two at the nose and tail, being intended for distant targets the Air Staff expected the bombers to be engaged more often and so need more turrets for defence. All of this came at a cost of course, the target cruising speed was almost 50mph slower than it's twin engined counterparts due to the extra weight and the increased drag from the larger size and the extra turrets. The discussions on this specification were more involved and it took several rounds of conference before a preferred design was agreed upon. At the technical level the Supermarine design was favoured, it was exceptionally "clean" aerodynamically and had much of the bomb load stored in the wings, allowing for a smaller fuselage and so less drag, all of which combined to make it exceptionally fast for such a large aircraft. The issue therefore was not the design but the company, not only were Supermarine were heavily committed to the Spitfire and another project but just as seriously their chief designer R J Mitchell had recently died, casting doubt on their ability to convert the paper design into a working aircraft with the stated performance. However the promise of the design, along with an understanding that Vickers would support Supermarine during the project and that all of Supermarine's non-Spitfire work be cancelled, was enough to see the design taken forward to prototyping. The Merlin engined Type 318 variant was tentatively selected as the Air Staff wanted to spread their bets on engine choice, though Supermarine were warned they would likely be held to their claim that engine type could be 'easily' changed. The other project was the Stingray, the latest upgrade to the venerable Seal/Sea Gull/Walrus line of amphibious biplanes that served as everything from gunnery spotters for cruisers to search and rescue aircraft. Naturally the Royal Navy objected and the Committee for Imperial Defence also made their views clear as the type had been slated for use by Australian and New Zealand on their cruisers, so the project was not cancelled but transferred to a different firm. A positive spin would see this as evidence of more joined up thinking between the services, though the Air Staff instead viewed it as confirming their worst fears about non-RAF types interfering with 'their industry' instead of just being grateful for the aircraft they were provided with.

With a degree of uncertainty looming over the preferred design the choice of second string backup attracted considerable attention. As with the medium bomber many of the tendered designs were quickly dismissed and need not detain us, however one failed contender is worth briefly mentioning as the reasoning is enlightening about the views of the Air Staff and Ministry at the time. The Armstrong Whitworth "Super Whitely" was rejected very early on and the company told to focus their efforts on the getting the Sabretooth Tiger engines into the standard Whitley, with the added instruction to finally sort out the wing incidence issue with the design while they were re-stressing the design for the 'new' engine loads. Interestingly as with Bristol their civil aviation projects were also cited as a reason not to give them the work, as we shall see when we look at the state of civil aviation in a later chapter they were heavily involved in another high profile airliner. The actual choice for second string came down to Shorts vs Boulton Paul and technically there was no clear winner, both designs needed some more refinement and both firms had made unfortunate engine choices; since the specification had been written less than a year earlier the Napier Dagger and Rolls Royce Kestrel had changed from acceptable options for a frontline aircraft to being preferred for export, trainer use or various non-aircraft purposes. As both would need re-designing for new engines the choice came down to industrial and workload factors, how busy the firms were and their capacity to produce the prototype and then the final design. Shorts were initially favoured, they had experience in large four engined aircraft and through their Short & Harland joint venture had a pool of available design staff they could share the workload with. Yet it was Boulton Paul who were selected, machinations elsewhere meant that Shorts were required to focus on other projects while Boulton Paul would find themselves short on work and in need of a project to keep their workforce busy. That said the Boulton Paul design was not a bad design picked solely due to workshare concerns, despite their lack of large monoplane experience the design was assessed as far easier to manufacture than the Shorts effort and the rear turret was particularly admired for it's low drag layout. The point is that had decisions in other specifications gone the other way Boulton Paul who have been focused on other projects while the Shorts design would be selected because it was the lower risk option from a company experienced in four engine monoplane design and construction; the stated reasoning of the tender design conferences should always be read with some caution, while wider industry and strategic concerns often drove their decisions they were reluctant to ever admit to this, if nothing else telling a company they had only got the job for workshare reasons was seen as a bad for morale at the firm in question and an invitation for yet more unwelcome questioning from those in government who disliked the entire Ring approach.

A Bristol Bombay bomber transport prototype on a trials flight, the under fuselage ordnance racks for the bomber part of it's role clearly visible. The need for a replacement for the biplane Vickers Vincents and Valentinas had risen up the priority list after the high profile role of No.216 squadron during the early stages of the Abyssinian War and the dramatic trans-continental 'Smuts Flight'. While in very heavy used by the RAF commands in the Middle East and India the bomber transport type had not been highly valued by the Air Staff who would have preferred more bomber. But with the Air Ministry, Committee of Imperial Defence and various 'air minded' MPs keen on the type and a higher priority given to the Aerial Policing mission, the Bombay was pushed forward for production. With Bristol heavily committed elsewhere the job was given to the Shorts & Harland factory in Belfast, they were also tasked with a number of modifications to the aircraft using the design resources Shorts had intended to use for the heavy bomber prototype production.

Before we leave the heavy and medium bombers behind us there is the matter of the B.17/37 specification which while never issued still managed to cause a great deal of heated debate inside the Air Staff. With the Lindemann Committee still working away on it's first recommendations report and the 'Ideal Bomber' project to convert those into operational requirements not even started, in theory the Air Staff should have been waiting before issuing any new specifications. In practice there was a great deal of jostling to get various pet projects started to create some 'facts in the air' or even just designs to bolster the relevant arguments. At one extreme came the faction that was basically happy with the current approach save for the lack of defensive firepower, recognising more turrets probably wasn't an option they wanted more lethal turrets, specifically 20mm cannon armed turrets instead of 0.303" machine guns. Given the large weight of said cannons and their ammunition supply they could not just be 'dropped in' to replace standard turrets, instead new aircraft would have to be designed around them. That a practical 20mm turret did not exist at this point, so there was nothing to design around, was deemed a minor issue and something for the manufacturers to sort out in their tender designs. At the other extreme the unarmed bomber faction were pushing for a high speed, high altitude bomber that could not be intercepted and so would not need weapons. In between was to be found those parts of the Air Staff that had to interact and deal with politicians, their main concern was a bomber that had a Far Eastern scale operational range, or at least something close, to show the RAF was responding to political concerns and so deserved a lot more funding. The compromise was the B.17/37 specification which attempted to do all of those things and yet was surprisingly coherent, at least on paper. On the defensive side the starting point was the RAE's belief that a remote controlled turret was probably technically feasible or very close to it, this was relevant because if gun turrets didn't have to fit a gunner in they could be a lot more aerodynamic, especially if the guns were concentrated in a tail turret. On the range issue the specification took it's cue from the trend towards accuracy and traded away a great deal of bomb load for fuel as well as specifying 'overload' launch to maximise the launch weight. Finally the cruising altitude was set at over 35,000ft, which required the aircraft to be pressurised, the cruising speed was to be at least 300mph while the range was set at being able to haul a mere 4,000lb of bombs 4,500 miles, which would put Taiwan in plausible range of a Malay based bomber. While none of the factions were pleased it ticked enough boxes for them to at least accept it, there was just one issue; the design was hideously impractical. While the technologies required existed they had only been used individually on highly specialised experimental aircraft or in the laboratory, certainly they had never been used all together while in the -50ºC air temperature of the expected altitude. While the exercise had comprehensively proven that some compromise would be required in the next generation of bombers, and prompted a number of research programmes to be urgently started, the Air Council was forced to step in and put a stop to the arguments. They instructing all sides to wait until the 'Ideal Bomber' report on what was both desirable and possible was issued later the following year, this was done in the full and certain knowledge that the instruction would just delay the argument as there was little hope of the report being universally accepted without a fight. Having dealt with the larger bombers we must move onto their lighter brethren, an area which in addition to all the technical and industrial considerations of the heavies also had politics, strategy and diplomacy to deal with.

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Notes:
Slightly longer than I had hoped, a different author would probably have cut off the entire first section but I left it in so everyone could understand how RAF aircraft procurement works because that is the sort of story this is.

The first three specifications are all entirely historic, however the selected aircraft are not for I hope solid enough reasons. If you know your British WW2 bombers then I hope you are nodding appreciatively and can enjoy speculating on the changes, if you have neglected your studies in that area I hope it was still an enjoyable read as I tried to steer clear of a confusing and distracting dump of numbers and figures. R J Mitchell's death is OTL, the Supermarine B.12/36 bomber was his last major design and the Air Ministry's concern about his absence is also historic. I would say this period is around the end of the 'Great Man' of design/engineering, before this point you could say one person designed that aircraft or engine, but around this point it becomes one person designed a key element and post-WW2 it was all mostly huge design teams. That said there is still space for my 'Great Idiot of History' theory as while one person cannot single handedly produce a war changing design, one idiot can still make really stupid decisions - see the He-119 Kurtie was discussing at the top of the page.

The 17/37 specification existed and was nothing like what was described, but it got abandoned for a similar reason - the RAF was unsure what a good bomber looked liked. The 'Ideal Bomber' study was an actual project of the Air Staff but the OTL version was aimed on producing a Standard Bomber, merging the Heavy and Medium categories and incorporating all the newest technologies, etc. In Butterfly it will be more concerned about producing a bomber that can survive in a world of RDF/radar and then be capable of finding and hitting precision targets, so all the listed often contradictory ideas about speed, altitude, armament will have to be balanced. Oh and it has to have a much longer range so the RAF can be taken seriously in chats about offensive war in the Far East.

I love the Bomber Transport idea not least because it seemed to actually work, it's another thing I think Past Pip should have covered in a bit more detail when talking about 216 Squadron and the early days of the Abyssinian War. But then if he'd done that we'd never have made any progress at all so perhaps it is for the best it was glossed over.

I'm hopeful the next one will be shorter as so much has been explained here and the Air Ministry used the same procurement process for everything, but I've thought that before so we shall have to see.

El Pip · Feb 18, 2024

Chapter CLXI: A Season for Decisions Part 3.

A reasonable starting point for this chapter is the question 'What did the RAF actually mean by the designation General Reconnaissance'? It is sometimes defined as equivalent to a modern Maritime Patrol Aircraft and certainly it is correct that a General Reconnaissance (GR) squadron would be expected to conduct patrols over the seas, watch enemy ports, locate and track enemy shipping, attack them if possible and generally co-operate and co-ordinate with the Navy. However there is a reason the name was General Reconnaissance and not something more obviously naval or maritime related, and it was not just the institutional pettiness of the RAF leadership. In addition to their maritime duties the GR squadrons were also earmarked for supporting the "counter air offensive" against enemy land targets, this being one of the many euphemisms the Air Staff liked to use to describe the heavy bombing of enemy cities. The Air Staff generously allowed that this would only occur if the air threat to the country was greater than the seaborne threat and that this approach gave the RAF more flexibility and prevented aircraft sitting idle if certain threats didn't develop. The claim was that this meant fewer aircraft would be needed overall and so it was the 'fiscally efficient' option, a phrase carefully calculated to please the Treasury. Understandably the Admiralty were suspicious of this entire approach, correctly suspecting that as the Air Staff would be doing the assessment the scales would always be heavily weighted towards the aerial threat. It must be stressed though that the Admiralty were far from impartial on the subject as they had their own self-serving agenda, specifically they wanted Coastal Command transferred to them as happened with the Fleet Air Arm (FAA), though they would be prepared to compromise on just getting operational and planning control. The Air Staff were well aware of this scheme, the Admiralty were very open in their campaigning and had their tails up after the success with the FAA, and were not taking it well. The RAF leadership of the time were institutionally insecure at the best of times, the only reason their response cannot be called paranoid is that paranoia is by definition unjustified and in this case the Admiralty was genuinely trying to take another chunk out of them. It should also be said the Admiralty's arguments were broadly correct, the RAF had a dim view of all maritime operations and Coastal Command (and Coastal Area before it) had been neglected both in terms of funding but also planning and doctrine. The Air Staff started from the position that properly applied strategic air power would win any future war long before the navy could do anything significant, a belief that had been somewhat shaken by the Abyssinian War as the Bomber Barons realised that politicians would not 'fall in line' and approve such a campaign. Their fall back position was that if a longer term economic warfare plan was pursued then systematic bombing and aerial mining of the enemies ports would be far more efficient than trying to establish a blockade or hunting down ships at sea. This was in line with the new 'precision' bombing doctrine that the RAF was developing with the Lindemann Committee, as we saw in Chapter CXLIX, so had a degree of official approval from Committee of Imperial Defence (CID) which was generally in favour of economic warfare as this was believed to play to Britain's strengths. Had the Air Staff stopped there then things would have been relatively straightforward, however there was the matter of coastal defence, the approved catch-all phrase for stopping an enemy bombarding the coast or even launching an invasion. This was a mission all the services had an interest in, perhaps in part because they believed it important but mostly because politicians believed it was important and so kept it well funded. The Army had control of the coastal defence guns, which we shall consider in a future chapter, the Navy argued for a strong Home Fleet and a series of local squadrons and flotillas along the east and south coasts, while the RAF maintained that airpower was obviously the best way to sink any enemy shipping. Unsurprisingly this was a very contested position, made complicated by how the Air Staff approached it.

A Vickers Vildebeest from No.22 squadron conducting a torpedo drop during a training exercise, clearly showing the very low altitude flying required. No.22 Squadron had technically served in the Abyssinian War, operating patrols out of first Gibraltar and then RAF Aboukir in Egypt. Perhaps fortunately for the crews they were never called upon to make a torpedo attack on the enemy, the massacre of the Spanish Republican Vildebeests showed how vulnerable the design was to even biplane fighters. This experience would have hastened the development of a replacement, but for the fact it was already a high priority within the Air Ministry. Until a replacement was available the Vildebeests would soldier on both in the Home Squadrons and the Far Eastern squadrons based out of Singapore.

Given the above it could be concluded that the RAF had neglected the anti-shipping mission, but this is to miss the subtle difference. Specifically dedicated aircraft had indeed been neglected in favour of multi-purpose designs, however the capability had not been ignored and could be found even in the main bomber force. The B.12/36 heavy bomber specification we looked in an previous chapter included the requirement that one permutation of it's 14,000lb bomb load be seven 2,000lb armour piercing bombs. After a brief dalliance with an 'all small bomb' policy by the mid-1930s the 2,000lb bomb was the Air Staff's weapon of choice against warships. Designed around a thick all forged steel casing testing had shown the 2,000lb AP could punch through seven inches of naval armour, far more deck armour than any battleship in service or even planned possessed. However, as we have seen the Admiralty took a dim view of the ability of level bombers to hit capital ships, particularly ones which were actually moving and firing back, especially from the relatively high altitude the bomb would have to be dropped from to achieve such impressive armour penetration. The RAF kept faith with the weapon and argued the new bombsights and tactics being developed would dramatically increase accuracy even against well defended moving targets, however for inter-service argument terms they were forced to accept it was not an effective anti-shipping option. The Admiralty also dismissed the Air Staff's latest invention, the buoyant bomb, and while the FAA had a dive bomber in service the RAF was still arguing about whether to specify one, as we shall see later. This left the torpedo, where once again we can see the Air Staff's distinctive approach to maritime warfare; the dedicated torpedo squadrons were in a bad shape with obsolete aircraft, yet their next general purpose 'world wide use' bomber had been specified with a torpedo carrying capability. This was not a minor concession, a standard 18" air-launched torpedo was lighter than a 2,000lb AP bomb but 50% longer and had a wider diameter. Bombers were designed around their bomb bays and the bomb bay shape was defined by the size of the torpedo, it was little exaggeration to say the next generation of RAF bombers would have been built around the anti-ship mission.

A brief discussion on the torpedoes themselves would be of value at this stage, starting with the point that the air-launched torpedo was a distinct weapon from it's ship or submarine launched brethren. The obvious difference was size, the air launched weapons were a nominal 18" diameter and half the mass of the heavyweight 21" weapons the surface and sub-surface fleets used, resulting in them having a warhead half the size while also being slightly slower and shorter ranged. The more serious difference was that the air-launched torpedo could withstand being dropped from an aircraft and not only still function but then run at the correct depth and in the direction it had been launched. This may seem a trivial point, however it was remarkably difficult to achieve in practice particularly if you wanted to drop from anything above wave top level at any reasonable speed. An air launched torpedo required considerable internal stiffening and reinforcement, special tail units and eventually cable drum units in the launching aircraft to ensure the torpedo launched and entered the water at the correct angle. The summer of 1937 had seen the Mark XII 18" torpedo enter service which increased the maximum drop speed and altitude to 180mph and 70ft respectively, though this was with a 'tolerable' level of failure. For the FAA's torpedo biplanes these were perfectly acceptable numbers, most of them could barely do 180mph in a dive and the crews were trained to fly at wavetop height. The problem came from the RAF side as most of the aircraft they wanted to use were far faster even at cruising speed, slightly more seriously they had been expecting a 200ft dropping height for torpedoes. This was not based on any technical requirement but a concern about the ability of 'general purpose' bomber crews to fly and fight at such low altitudes; removing the need for low level training would get the Air Staff one step closer to eliminating dedicated torpedo bomber squadrons. As torpedoes were a naval weapon the Admiralty had full control over design and production, however the Air Staff had learnt from previous experiences so invoked the threat of the Ministry of Defence Co-ordination, suggesting that as torpedoes were a joint weapon shared by the two services a co-ordinated approach might be appropriate. Keen to avoid outside interference, and begrudgingly accepting the point, the Admiralty agreed that they would prioritise a significant increase in acceptable dropping speed and altitude in the Mk.XIV torpedo they had just stared development on for their own new torpedo bomber. In passing it is interesting to see some superstitions were observed and there would be no Mk.XIII torpedo of any size produced or even designed. The wider significance of this clash was the Air Staff engaging with the new attitude of inter-service 'co-operation' and starting to play the necessary political games rather than just trying to argue their needs were more important. On the less positive side is the fact that such games were still necessary and the unfortunate reality that the main grease for the wheels of inter-service co-operation was the threat of getting politicians or the MoDC involved and not any actual commitment to joint efforts.

A cut-away labelled schematic of a B. 250lb Mk.IV, also know as the Buoyant Bomb. The theory was simple, the bomb would be dropped in the path of the target, sink down 50ft or so, arm it's fuse and then rise back up, hopefully hitting a ship's hull on the way, if not the buoyancy chamber would slowly flood and the bomb would sink back down to the depths. The bomb itself had taken a decade of development work to produce and in practice was not without drawbacks, most notably it needed to be dropped in large numbers if a tight pattern to have any chance of hitting anything, though when one did hit it was devastating and would easily break the back of most ships despite it's relatively low weight. It was soon noted that if you had a squadron that could fly in tight formation, at low level, and launch all at the same time then they would also be capable of making a devastating torpedo attack. As a torpedo attack was a well understood and proven technique it was unclear what the practical advantage of the 'B-Bomb' was. Development work would continue but the Air Staff were never able to dispel the suspicion that the project's main aim was to avoid needing to procure any torpedo capable bombers rather than producing a serious weapon.

The project we are considering began in late 1935 with the issue of M.15/35, a specification for a multi-role aircraft capable of both torpedo bombing and reconnaissance work, though inevitably a level bombing requirement was soon added. Why the bombing requirement had not been included at the start is somewhat unclear, though it was most likely a gesture towards their critics (not least the Admiralty) that they were taking the maritime mission seriously, if so it fooled no-one. It is sometimes claimed the usual processes were disrupted by the Abyssinian War, which is true but the disruption started during the preceding 'Crisis' phase when reinforcements were rushed to the Mediterranean Theatre. Amongst the aerial assets sent out were the UK based torpedo bomber and GR squadrons and even during the pre-war 'show of force' patrols the problems with their aircraft soon became apparent. The obsolescence of the biplane Vickers Vildebeests was obvious, but as we have seen the brand new Avro Ansons of the GR squadrons also disappointed even if they did prove capable of carrying out the reconnaissance mission once at war. Consequently the new designs were ordered off the drawing board in the spring of 1936, the Air Ministry agreeing there was no need to wait for formal post-war 'lessons learnt' to confirm the urgent need to re-equip Coastal Command. To somewhat mitigate the risks of this the Ministry selected two designs, the Bristol Beaufort was a development of the proven Blenheim which was felt to make it lower risk, while the Blackburn Botha was a fresh design but it came from a company with experience of naval aircraft. Assuming a typical 18 month period for the first aircraft the Aeroplane and Armament Experimental Establishment (A&AEE) should have been starting testing on the new types in the autumn of 1937, however the Air Staff had proven fundamentally unable to stop fiddling with the specifications and thus both were badly late, albeit for different reasons. The Botha suffered due to the many changes made to try and turn it into a medium bomber; a high cruising speed at altitude was required, the nose redesigned to improve bomb aiming over 'strategic' targets and an ungainly dorsal turret was added with a dedicated gunner, increasing weight and compromising the aerodynamics. The demand for greater speed on a heavier aircraft had prompted Blackburn to request higher power engines be made available, however this would result in yet more delay on an already late 'urgent' project. The Beaufort in contrast had a far simple life, while it was not quite the simple modification that the Air Ministry had envisaged it had proven relatively straightforward to stretch the Blenheim to fit in both a fourth crew member (the dedicated radio operator that the RAF felt the reconnaissance mission required) and an internal torpedo. Unfortunately Bristol had come to the same conclusion as Blackburn, the specified Bristol Perseus engines were far too under-powered for the now much larger aircraft and had requested an engine change. Worse their proposed change, swapping in the slightly larger Taurus engine, was now impossible as the Ministry had just officially killed that engine.

At this point the Admiralty entered the picture as the FAA were also working on a new torpedo bomber, having issued a new specification to industry earlier in the year. The details were heavily tied up in ongoing Admiralty arguments about carrier doctrine, detection and the value, or otherwise, of multi-role aircraft, so we will be looking at S.24/37 and the resulting aircraft in the context of those discussions in a later chapter. The relevance for our current purposes is that the FAA were also looking for a torpedo bomber with reconnaissance capabilities and to many in government that was seen as broadly similar to what the RAF were looking for in their new aircraft. Given the issues around the RAF's efforts outlined above there were voices in the Treasury, and to some extent the MoDC and CID, that argued for a common aircraft focused on the FAA's effort. On first glance this seems implausible as the specifications were wildly different, the FAA wanted a single engined small aircraft while the RAF was looking at a twin engine medium bomber sized design. However it is a fact of procurement that most politicians merely saw numbers of aircraft and did not enquire too deeply (or at all) about the details, making it a more feasible option than the facts would suggest. Thus this political idea was revised by the CID into the more practical suggestion of once again splitting apart the GR and torpedo roles that the Air Staff had combined, so the torpedo bomber squadrons could use the new FAA aircraft while the GR squadrons could get a dedicated machine. A joint procurement would get the benefits of scale for the torpedo bomber as the two small service specific orders combined would make one worthwhile order, while if the GR machine could be based off an existing light bomber and benefit from the scale there, so the industrial logic was sound enough. The long standing RAF habit of giving the FAA 'navalised' version of their own aircraft was cited as a precedent, the Admiralty doubtless enjoying being able to use this practice against the Air Force. Naturally the Air Staff were opposed to the entire concept for reasons far beyond just the practicalities, in particular they feared any "joint" project would actually result in the land based torpedo bombers all being Naval Air Squadrons under Admiralty control. At the political level the Air Ministry was also opposed, cancelling both aircraft after the orders had been placed would throw into question many of the measures that Air Minister Churchill had implemented to 'speed up' procurement and his rush to scrap the biplanes. Even those senior civil servants who took the pragmatic view that taking the blame was the main purpose of a Minister were opposed, because the cancellations would be expensive (Blackburn were building a new factory just to meet the order, so would be due compensation) and so attract unwanted Treasury and political attention. There was therefore considerable pressure with the Air Ministry that the proposal be resisted and the Beaufort and Botha not fail, or more precisely not be seen to fail.

A Handley Page Hampden having just taken off from the Handley Page factory at Radlett, passing an LMS Garratt pulled coal train on the mainline. The Arctic Hampdens of the Royal Canadian Air Force had been modified to be torpedo capable, somewhat crudely as it required the bomb bay doors to be fixed open but even with that extra drag it was still almost 100mph faster than a Vickers Vildebeest. It was suggested that if the Botha and Buckingham were cancelled some of the RAF's Hampdens could be similarly converted to provide an interim capability, until the joint FAA torpedo bomber was ready. The Bomber Barons had already 'lost' several squadrons of bombers to Strike Command and so would bitterly resist losing any of their Hampden squadrons.

There was also an Imperial and indeed international dimension to the matter. While the effect of this should not be overstated, domestic defence priorities still dominated, the Dominions actually attending and engaging with the CID was having an impact. The government's shift of focus away from Europe and towards 'Far Eastern Imperial Defence' also raised the importance of Dominion considerations; Canada, Australia and New Zealand were far more concerned about the Japanese threat than anything in Europe and as we have seen all had aircraft and support deployed to Singapore. Starting with Australia the Royal Australian Air Force (RAAF) was very interested in the Beaufort as an interim aircraft until their domestic Vickers Wellingtons came off the production line, a date which kept on slipping as the challenges involved became apparent. Despite some exceptionally optimistic voices calling for Australian production of the type the Lyons Administration had decided that the Hurricane and Wellington factories were already close to over-stretching Australian industry. Entire new industries and production lines were having to be established and supported, none of which was proving as straightforward as the politicians and aviation industry backers had believed. There was also the matter of balancing the economy, as in Britain the Department of the Treasury was raising concerns about the impact of the defence programme on the Australian economy. The concern was not particularly the spending (though no Treasury in any nation was ever entirely happy with spending) but the bottlenecks and sector specific shortages as a large number of projects chased after a small pool of specialist resources and manpower. Trying to build yet another aircraft type, with a different construction method and completely different engine, would just make this much worse and start to seriously impact the civilian economy. The RAAF had already acquired a batch of 40 Bristol Blenheim light bombers to serve in the GR role and acquiring the Bristol Beauforts for the torpedo role would allow for a degree of commonality in training and maintenance. This acquisition would 'just' take money and with the ongoing export boom this was something Australia could more easily afford than disrupting the wider economy.

The position of the Canadian government and the Royal Canadian Air Force (RCAF) was somewhat different as the Canadian economy could support an additional aircraft production line without undue stress or impact elsewhere. The larger population and larger industrial economy helped but so did the 'brain gain', the steady flow of American engineers and designers drawn across the border to work by the steady work and good salaries offered by the Canadian aeronautical industry. Given the later panics over this it is interesting to note that, to the extent anyone in the US government or industrial circles was aware at all, this was viewed as a benign if not positive trend; American staff getting experience and 'trained up' at the expense of others, the unspoken but incorrect assumption being that said staff would later 'come home' and bring that knowledge and training back to the US. One trend that had been noticed was the inability of any US firms to get involved with the RCAF rearmament schemes or even win any significant sub-contracts. Despite a faction of the Canadian government still being in favour of this outcome, a mix of British pressure and steep tariffs pushed US manufacturers to the bottom of the list. Canada could have added a defence exemption to the tariffs, and many US firms spent large sums lobbying for this outcome, but even if the Canadian government would have been prepared to 'blow up' Imperial Preference and defy the still brand new Imperial Trade Council they would not do so unilaterally. Had the US been offering some meaningful and significant tariff exemptions of their own then Imperial unity may have been tested, but fortunately for the Imperial Trade Council the US State Department remained committed to a unique vision of free trade where everyone else dropped their tariffs while the US didn't. Consequently when the Canadian government decided to put together a second aircraft producing consortium (the Canadian Vickers lead CAA were still working away on the Wellington Project) this too would be led by the Canadian arm of the relevant British manufacturer, the question was which manufacturer? The Canadian government remained focused on the maritime reconnaissance mission, looking for modern planes that could patrol and protect Canada's considerable coastlines on the Atlantic and Pacific. The RCAF Air Staff did not disagree with this priority but were agitating for a multi-role design, one which could perform maritime reconnaissance but was also able to attack anything it found. In the background lurked the Japanese threat and Singapore, just a pair of fighter squadrons had given the RCAF an importance and profile they had not previously enjoyed. A GR/torpedo bomber squadron or two would give RCAF Singapore a real offensive punch and raise their domestic and Imperial profile still higher, perhaps higher than the RAAF detachment in Singapore with whom there was a very real undeclared rivalry. The Canadian government were concerned this was exactly the sort of slippery slope they had been trying to avoid, but conceded the financial and logistical logic of combining the GR and torpedo squadrons was tempting. While the Beaufort or Blackburn ticked the box perfectly there was an alternative; the Handley Page 'Fat' Hampden. As we have seen an interim torpedo carrying variant of the Hampden already existed but Handley Page had not been content with that, they had been one of the losing tenders for the M.15 specification that produced the Beaufort/Botha and so they had a paper design for a fully torpedo capable aircraft ready. Marginally longer and significantly wider than the original, hence why it was the 'Fat' Hampden in contrast to the famously thin fuselage standard Hampden, on paper this was an equally acceptable option which also had considerable logistical commonality with the Arctic Hampden soon to enter service. Handley Page were prepared to set up a new Canadian factory to allow local production and were proposing an engine swap to the Merlins used in the Snow Hurricanes, partly to ensure the larger Hampden maintained performance but also to head off concerns about the performance of the Napier Daggers in the tropics.

A contemporary cut-away drawing of the Bristol Beaufort as printed in The Aeroplane magazine. The torpedo is drawn to scale, clearly showing why the bomb bay and thus the bomber had to be designed around its considerable length. The dedicated radio operator position was a matter of technology as much as doctrine, voice communication (R/T, Radio Telegraphy) had a range of perhaps 35 to 40 miles which was far too short for reconnaissance work, in contrast morse code (W/T Wireless Telegraphy) was good for 500 miles or more. The other role of the radio operator was operating the D/F (Direction Finding) equipment, the un-numbered teardrop shaped item above his head was a D/F loop aerial inside an aerodynamic fairing. From this bearings could be taken from radio beacons, allowing the radio operator to determine the aircraft's location.

On a purely design level the Air Staff technical staff had no issue with the 'Fat' Hampden, indeed doctrinally it had much to recommend it as the larger body would give it more capacity when serving as a level bomber. The concern was capacity, Handley Page did not have a large design staff and the firm was busy working on both the existing Hampden variants and the more important P.13 medium bomber, hence there were grave doubts the firm could manage any work on another major re-design, let alone support setting up an overseas subsidiary and production facility. The Air Staff wanted them busty churning out medium bombers to modernise and fill out the ranks of Bomber Command, too many bomber squadrons were still equipped with biplane Hawker Hinds or worse. The Air Ministry's decision was simple if somewhat risky, the Beaufort would get a new engine but it would be the Hercules not the cancelled Taurus and Bristol's airframe division were instructed to make the re-design a high priority. As we have seen the Hercules was still under development itself and projected to be at least 50% more powerful than the Perseus engines the Beaufort had been designed around originally, the Air Staff were hoping both that the engine worked and that it would not prove too powerful for the airframe. For inter-departmental purposes however the Air Ministry downplayed those risks and used the Dominion interest in the design to enlist the CID's support in killing off any idea of a 'joint' future torpedo bomber. This left the question of the short term impacts, because if the Beaufort was to be a higher priority then something else would have to be lower. The selected victim was the Blenheim Mk.IV, a substantially improved version of the original Blenheim including a longer nose for better navigator visibility, much larger fuel tanks for longer range and the new 100 octane capable Mercury Mk.XV engines. A first prototype was being tested and was flying well, but as always work would be needed to make the design ready for mass production and it was this work that would slip. In the interim the Blenheim Mk.I would remain in production, both for the RAF and for the large numbers of overseas buyers from Finland to Turkey for whom it was arguably the better choice. As we have seen 100 Octane was only available in limited quantities from limited sources so sticking with the Mk.I meant existing supplies and stockpiles of standard fuel could be used, a considerable plus for smaller air forces and indeed for the more remote RAF squadrons, such as those on the North West Frontier with RAF India that did not need absolute maximum performance. The Blenheim Mk.IV would eventually see production later in the decade, serving in the strategic reconnaissance squadrons and finding a niche as a night fighter

The Blackburn Botha prototype, the distinctive 'high wing' profile is clear as is the terribly misshapen dorsal turret just aft of the wing. There is a somewhat notorious quote that is attributed to many test pilots and aircraft "Gaining access to the cockpit is difficult. It should be made impossible". Whether it was first said about the Botha or not is unclear, but the fact it is such a favoured candidate is very telling about the aircraft and it's reputation. While possessing the usual Blackburn robustness and structural strength, it was badly underpowered, had stability issues and the high wing and engine mounting restricted visibility anywhere other than straight ahead, which was unfortunate in a reconnaissance aircraft. Poor as these features were the combination was lethal, should an engine fail the aircraft was unable to maintain altitude on the remaining engine, while the turret blocked the airflow to the tail fin and rudder so the aircraft became uncontrollable.

In contrast to the depth of effort and thinking put into the decision to proceed with Beaufort, very little appears to have been expended on thinking about the Botha. Officially it remained the backup and some efforts were made to deal with the power issue that Blackburn had highlighted, the design was allocated the improved 100 octane fuelled Perseus engines. Unfortunately the extra 80 odd HP in the new engines didn't even compensate for the extra weight and drag of the Air Staff's changes, let alone address the underlying problem. This could have been justified as a minimal change decision to avoid delay, switching to the latest model of Perseus engine kept the engine the same size and weight, so avoided any need to look at the structural design or re-do any other aspect of the design. However with Blackburn were busy on other projects, the majority of which were deemed a higher priority, work on the Botha slipped considerably and while a prototype (technically the first production aircraft) was produced it wasn't until near the end of the decade. The initial, very unfavourable, flight test reports, along with other aircraft already being in service, were used as justification to cancel the large scale orders that had been made. This is somewhat suspicious as while some of the problems may have come as a surprise, the key issues around lack of power and poor visibility had been apparent since the mockup stage, yet apparently only became serious enough to justify a cancellation much later. The contractual and commercial issues around cancellation that the Air Ministry had raised proved to be relatively simple to resolve, Blackburn were paid the standard development fees for the prototype and the new factory was given other aircraft to work on along with compensation for the few items that had been stockpiled for Botha production that could not be re-used or re-cycled. It is likely there was an element of carrot and stick to this, the Air Ministry agreeing to a bit more compensation than was perhaps strictly necessary while also making it clear that Blackburn's continued membership of 'The Ring' of approved suppliers depended on them not making a fuss about the changes. The truth of the matter appears to be that the Botha survived to reach prototype because it was less politically costly to cancel a failed prototype after a poor flight test than cancel it early and admit a mistake had been made in ordering off the drawing board. From this perspective the Air Ministry approach to the Botha was not a missed opportunity to fundamentally re-design it into a decent aircraft, but a carefully managed plan to minimise the political cost of the mistake of ordering it by delaying things long enough that they had some acceptable reasons to cancel it. This does point to an underlying issue with the Air Ministry's approach to risk, while it was internally accepted that some designs would fail and not every decision would be correct (particularly ones made under the accelerated approach championed by Churchill), the political and media culture was rarely as tolerant. In the scheme of things the Botha was a relatively low profile affair, our next subject was the subject of far more attention.

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Notes:
There is a lot in this one but I think it is all relevant, the plans to draft the GR squadrons of Coastal Command were OTL for the period as was the Admiralty lusting after a take over. In 1940 they got Operational command of Coastal Command and the RAF only kept overall ownership because it was thought a transfer would be too disruptive, it was a vicious debate in the 30s.

The B-Bomb is OTL and worked well in the lab and in trials, but was just too fiddly to deploy and never worked in action before being abandoned mid-war. The RAF did hate the the maritime mission while also including anti-ship AP bomb and torpedo capability in many aircraft. It was seemingly contradictory but I think was a "This is pointless, but if you insist on doing it then we can do it best" attitude. Couldn't fit it in but another issue with the 2,000lb AP bomb was it contained very little explosive, the case was so thick and heavy (to get that massive armour penetration) there wasn't much space left for any explosives.

The British torpedo establishment was a mess of competing fiefdoms; the Admiralty did control the weapon, but the FAA and RAF had parallel training and testing organisations. It is tempting to call this inefficient, because it was, but it also avoided the problems the US had with it's torpedoes as the RAF had every incentive to find fault with them. That said it was far from perfect as the RAF mix up over dropping height/speed shows.

OTL the Beaufort never worked because it was stuck with the awful Taurus engines, here it skips straight to Hercules so will be fine. Australia got a licence in OTL and built them as the DAP Beaufort, while Canada got a licence for the Bristol Bolingbroke (which is almost the same as the Blenheim Mk.IV but without the new engine). The details are far more complex than that, the RAAF tied themselves in knots trying to pick a bomber and the RCAF were frankly worryingly obsessed with recon aircraft, but those are not our rabbit holes to probe too deeply. In any event in Butterfly that all gets shaken up a bit, so Australia just buys them in while Canada goes for the more flexible Beauforts but with British contractors and not US Fairchild. The Bolingbroke effectively never exists outside a proposal, getting killed so Bristol have more time for other stuff.

The Botha frankly should have been killed but got swept up in the general "Build loads of stuff, we need numbers" re-armament effort. That the Botha was a better level bomber probably helped convince the Air Staff to keep it alive, or at least it could have been a better bomber but all the problems listed are OTL. It probably was saveable, a proper (or removed) dorsal turret and Hercules engines might have made it an average(ish) design, but there are other priorities and the Air Staff are making mistakes and politically motivated decisions, so it sadly lives to at least be a prototype.

This chapter could have included some background detail on radios, W/T, Medium frequency vs high frequency, aerial design theory and transmission/reception ranges, but luckily it didn't. However I hope the short blurb explains enough of this, certainly I had often wondered about the seemingly strange radio or morse code fit outs of RAF and FAA aircraft and understanding the technical limitations of the technology at the time made it all much clearer to me.

El Pip · May 30, 2024

Chapter CLXII: More than a Miner Inconvenience.

From a certain perspective the British coal industry in 1937 was doing tolerably well, the industry had coped with the disruption of the Abyssinian War and the Anglo-Irish Trade War, domestic production was holding up and industry-union relations were no worse than usual. Attractive as this view was, at least for those who were predisposed to let sleeping dogs lie, it missed out on a number of issues which had forced successive governments into action. There is a temptation to talk about coal at a grand scale and invoke the major trends that were involved; electrification and mechanisation, the rise of oil, the changing shape of the British economy and so on. All of these certainly played a part and we shall look at them in turn, but the reason that coal was such a political problem is far more simply explained; in the years since the Great War coal production had remained broadly flat but employment had fallen by 40%, over 350,000 net jobs being lost over the period.

The tale of the post-Great War British coal mining industry in a single chart. A subtle omission from this graph is the data for 1926, the year of the General Strike. While the General Strike itself may have lasted barely eight days, many of the coal miners had stayed out on strike until November severely disrupting production for most of the year. Many is not the same as all and certain mining regions had returned to work early, most notably the new mines on 'The Dukeries' coal fields of Nottinghamshire. The resulting fractures in the mining unions had still not healed over a decade later and would get worse when the independent Nottinghamshire and District Union abandoned merger talks with the national Miner's Federation and accepted the the TGWU enabled offer to affiliate itself with the Liberal Social Democrats. The growing splits in the union movement were of great concern to the TUC and the Labour party who were locked in argument about how to respond.

Bad as those figures were they actually under-stated the problem, a clue to the reason why can be seen in the use of the slightly clunky term 'net jobs'. If an older colliery that employed 2,000 men closed down and was replaced by a new mechanised operation that could produce the same amount of coal with only 1,000 employees, that was a net loss of only 1,000 jobs. However, if the new colliery was not in the same region as the closed site then the local employment impacts would be far worse than the net figure would indicate. This was the problem facing the government, the pits that had closed had been concentrated in the traditional coal mining heartlands of South Wales and the North East of England, while many of the new shafts that had been sunk had been located on the new Nottinghamshire and Kent coal fields. Consequently the overlap between the Special Areas and the traditional coal mining regions was considerable, only the struggles of the textile industry being comparable in scale and extent. From a political perspective therefore the key figures in the coal industry were not output, efficiency or even profitability but employment, specifically employment in the struggling Special Areas. For this reason the coal mining industry was not seen as a strategic or economic issue but as a social problem and policy was developed and judged accordingly. The chosen policy since 1930 by Labour and National governments had been cartelisation and quotas, the government fixing a 'tolerable' price for coal (i.e. one which kept the struggling pits just about afloat without causing too much damage to the wider economy, at least in theory) and dividing up the market in each region by setting quotas. The hope had been that this would be a temporary measure and that as the economy recovered from the depression and returned to growth so would the coal industry. The economy duly recovered and in terms of output so did coal, but by the politically important measure of employment the industry had at best stabilised and even that was only true at the national level. It is sometimes claimed that it was the only the political pressure to 'do something' about the Special Areas that prompted the government into action and doubtless that was a motivating factor, but the government focus on the coal industry should be seen as a part of a wider effort by Eden to re-focus the government on domestic priorities. Of course government attention is in no way a guarantee of a problem improving.

The pit village of Dowlais in Merthyr Tydfil, South Wales. The low rectangular white buildings at the rear left are the Dowlais foundry works, to the right is the demolished iron and steelworks and dominating the centre of the picture the massive tip that loomed over the town itself. The heavy job losses at the local coal mines during the 1920s had been a body blow to the region, the subsequent closure of the blast furnaces and steel works then all but killed off the local economy. The UK national unemployment rate had dropped below 10% by late 1937 and even South Wales had got the figure down to 30%, but in Dowlais unemployment was still at a shocking 75%. This was not an isolated problem, hundreds of coal towns and villages across South Wales and the North East of England were similarly affected.

As had become traditional for the coal industry nationalisation was briefly considered but then discounted, just as it had been in the many government and independent reviews since the Great War. The previous Conservative dominated National Government had engaged in a great many 're-organisations' of heavy industries hit by the Depression and Eden himself was supportive of state intervention, or at least the Tory One Nation version of it. Outright nationalisation however was a step too far for much of the wider party both inside and outside of Parliament. This was not just a matter of ideology however, aside from the considerable cost of such a move it was also unclear how the change in ownership would actually help the problems of the industry. The Coal Council was already centrally controlling price and production quotas, with the effect the failing pits were being subsidised by the successful pits (and coal consumers), a nationalised industry would just formalise the de facto centralised control. The more cynical would note that nationalisation would also mean the government would be more clearly responsible for the quotas and any consequences rather than being able to blame the Coal Council for any unpopular decisions. The other great claim of nationalisation was that it would vastly increase efficiency and productivity, even if this had been true such an outcome would make the political problem worse not better; increased efficiency allowed fewer miners to produce the same amount of coal, which raised the prospect of further job losses.

An obvious challenge to the analysis above is that it assumes a static market, that an increased supply of cheaper coal would not find new customers. This neatly brings up one of the main external challenges facing the coal industry; the squeeze on demand from advancing technology. This is often taken to mean changes such as the proliferation of diesel fuelled motor vessel replacing steam ships, the electrification of railways and the ongoing tussle between 'town gas' and electricity for new homes, all of which were indeed factors. One of the most serious impacts however was the growing efficiency of existing technology, as an example a pre-Great War steam boiler would be at best 15% efficient but by the mid-1930s it could be 35% or better. Similar, if less dramatic, efficiency gains could be found in everything from blast furnaces to turbines all of which enable far more useful energy to be extracted from the same amount of coal. This growing efficiency, along with the rising use of oil based fuels, had kept domestic coal demand flat even as energy used continued to rapidly rise. This did not stop a determined band in parliament and elsewhere trying to fight back, the demands for a return to a coal fired fleet or a more lavishly funded coal-to-oil programme were fundamentally aimed at increasing domestic demand for coal and so helping the struggling mines. As we have seen all these proposals were rejected by the government, almost always because they were incredibly expensive, massively impractical or both. Government planning would therefore proceed in line with the industry's own prognosis that domestic coal demand would be broadly flat at best.

Black coals over the white cliffs of Dover. The Tilmanstone aerial ropeway ran coal from the East Kent coalfield to a tunnel through the white cliffs and direct to Dover port for onward shipping. As was often the case government efforts to solve a previous problem were a cause of the current issue, in this case the development of the East Kent coalfield in the 1920s had been guaranteed by the Treasury as part of a wildly ambitious Labour plan to re-start the long dead Weald iron industry developed by the famed town planner Professor Abercrombie. The plan failed at anything beyond a few half laid out towns, but the coal mines proved profitable enough not to need the guarantee and, while never nationally significant, were large local employers. As crisis hit the wider industry more than a few politicians would come to wish the Kent mines had never been guaranteed and the jobs had stayed in the traditional mining regions.

Having decided what it would not do, or in some case could not do, the government was left with the question of what it would do. A twin track approach was decided upon, a somewhat convoluted plan to support the industry alongside an acceleration of existing schemes to re-train and re-locate former coal mine workers. To deal with the first point the planned Coal Act would nationalise ownership of coal mining rights which at the time sat with a wide range of owners, not always the same as those that owned the land above the mine. A new Coal Commission would be responsible for those rights, as well as continuing to 'encourage' mergers and acquisitions in the sector to reduce the number of coal mining companies and promote economies of scale. That nationalising the coal industry was a step too far but forcibly acquiring the mineral rights was in principle acceptable is an interesting insight into attitudes of the time, the distinction between government actively controlling an industry versus the entirely passive act of collecting royalties was considered a significant one. It should also be noted that the acquisition was not completely unprecedented, gold and silver mining rights had sat with the crown for centuries while the 1934 Petroleum Act had claimed for the state all 'unknown' oil and gas reserves. The Petroleum Act had been generally seen as a success, the legal certainty on rights and royalties had prompted a rash of exploration as we saw in Chapter CL, that there were no significant reserves to find was a fact of geology and not a failure of the system. Having a single rights owner for all coal would, it was hoped, allow mines to be planned and developed in the most efficient way without being constrained by a morass of agreements and leases; there were just over 1,800 producing coal mines in the UK but over 17,000 companies and individuals would register as owning coal rights. Of course this would mostly benefit new and expanding operations as already existing mines were committed to their current configuration, hence the second objective of the act, to substantially cut the rate of royalties. Such cuts would allow a reduction in the domestic price of coal without damaging the financial health of the mining firms and would increase the competitiveness of exports. As is often the case the 'ends' were popular but the 'means' by which they would be achieved were not, in this case it was the compensation being proposed that was the sticking point. The Greene Committee (named after it's chair the leading administrative judge Sir Wilfrid Greene as he was then) had assessed the value of all coal mining royalties as a shade over £4.4 million a year. Taking the standard 15 year valuation life of a mining royalty they decreed that £66.5 million was the fair value to acquire the rights, for comparison the entire RAF budget for 1937 was barely £55 million so this was a substantial sum. As the government could borrow for the long term at very low rates, around 3% for anything with a Treasury guarantee, the interest cost on such a sum would be only £2 million a year. Thus the new Coal Commission could substantially reduce the royalty rates paid by coal mine and be entirely self financing, a key requirement to get support from the Treasury and the more 'economically minded' backbench MPs. The controversial issue was that the Greene Committee had used the previous seven years of data to assess the annual income from royalties, a period which included the depths of the Depression and so, it was argued, significantly undervalued the royalties. Again it is interesting to note that the actual principle of the nationalisation scheme was not strongly objected to or even particularly commented on, it was concerns over the allegedly low price being offered that drove the opposition. That such opposition included the Church of England, who's Ecclesiastical Commissioners owned considerable coal rights in the North East of England due to their complex legal relationship with Durham over the centuries, lent those objecting to the act a certain moral sheen they perhaps did not deserve. In any event this alliance of large landowners and Lords Spiritual was unable to prevent the passing of the Act and it would duly come into force, an important detail for our current period was the extended implementation period. With over 17,000 claims to value the Act allowed five years to get them all valued, any appeals heard and the final totals reconciled and paid out. As a result the Coal Commission would not be able to start reducing royalties until 1942 at the earliest.

Snowdon Colliery on the East Kent Coalfield, in the background the partially built new town of Aylesham that had been built to house the miners. The deepest mine in Kent at over 3,000ft it was also somewhat damp, a combination which made it hot and humid; temperatures of 100ºF (38ºC) and 80% humidity were typical. The mine soon attracted the nickname 'Dante's Inferno' and was held to be one of the worst pits in Britain to work down. The workforce was almost entirely non-local, consisting of desperate miners from the Special Areas and those who had been blacklisted after the General Strike and could not get employed elsewhere. Unsurprisingly Aylesham was a fractious and divided place and only a quarter of it's housing was ever built, the idealised cohesive community the planners had hoped for entirely failing to materialise.

The other strand was what to do with the unemployed mining workforce or as some would have it the ex-workforce. As we saw in Chapter CXLI the government was keeping faith that the effects of the economic boom and the funding available from the new BIFID corporation would benefit the Special Areas and help the regional economies. However the Commissioners Reports were making clear that some of the former mining areas were not benefiting and probably never would; the remote pit villages of Northumberland and the mining valleys of South Wales were too small to have worthwhile local markets for local light industry and too far from decent transport links to attract any larger. The solution to this had been internal migration, from the 'Labour Exchange' system which advertised all the jobs available elsewhere through to schemes to encourage and financially support those re-locating. These had been a considerable success on their own terms, South Wales had experienced a net population decline of almost 300,000 people due to people moving out and there was a similar, if less dramatic, pattern in the North East. A minority had moved to the new mines in Kent and Nottingham but the majority had abandoned the traditional trades and started working in the new light industries of the Midlands and South East. Excluding the few who had relocated to the new coal fields the majority of those who had left were young and those with new families who were more prepared, often even happier, to work in a factory rather than down a mine. What was left was the older cohorts more attached to the mining identity and unwilling, sometime unable, to re-train and start a new profession at the bottom. The government's new approach therefore was to harness those skills to rejuvenate an old struggling policy, the Empire Settlement Act. Passed in the early 1920s it was a scheme to support emigration to the Dominions, which at the time were keen to increase their populations and were running land settlement schemes to set up new citizen farmers on empty land. The scheme was also popular in London as a way to build bonds of Imperial unity and as a way to deal with lingering post-Great War unemployment. Previous effort had been made to process miners through the scheme, several thousand being sent to Canada to work on the harvest and (in theory) stay on to start their own farms. This had ended badly with three quarters returning after the harvest, which was a depressingly typical outcome for the scheme, in the end however it was a combination of the Depression and advances in agricultural technology that all but killed the scheme. The key change in the new proposal was to stop trying to turn miners into farmers but let them carry on being miners, a seemingly obvious observation that had nevertheless taken Westminster, Whitehall and the Dominions 15 years to come up with. With the Empire in grips of a number of mining booms, primarily gold but also bauxite and a number of other key minerals, there was a strong demand for experienced miners and while coal mining is different from hard rock mining it is far less of a transition than agriculture. Another lesson from the earlier debacles was the need for proper co-ordination, a task which bounced around Whitehall until landing with the Imperial Trade Council and was the start of that bodies evolution beyond it's original more limited role. There was of course a price for such expansion, in this case the Council became the venue for the intense fight over the Imperial Labour Exchange proposals, a row we shall be looking at in due course. In the short term however the scheme was a moderate success, assisting tens of thousands of miners and their families to relocate to mining projects across the Empire.

The one area that we have not covered in detail is exports which had once been a pillar of the industry, prior to the Great War Britain had been formidable coal exporter with almost a third of all mined coal being destined for overseas markets. The Great War, more precisely the consequences of the war, had disrupted this setup considerably as old markets shrunk or disappeared entirely and new players entered the export trade. As a result far from looking to expand exports the main concern for industry and government was to preserve existing market share, as we shall see in the next chapter this was far from a straightforward endeavour.

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Notes:
Coal! Graphs! Graphs about Coal! While writing this one it seemed longer, yet in the end it's about average Pip chapter length. I think this is in part because so much got cut out as being irrelevant. You were for instance saved the baffling history of British work camps/improvement centres, places where the soft and workshy unemployed would be made fit for work through the pedology of labour, a terrible idea and so unsurprisingly is the fault of the Fabians, one of Britains' most reliable sources of terrible ideas. There is also more coal to come as we look at the thrilling concept of international coal cartels! And hopefully more interestingly back stabbing politics, trade shenanigans and low ambition disguised as high strategy.

The Coal Act is OTL, as the chapter says I think the different views on nationalisation and state vs private industry are interesting, as is the fact this was an employment problem not an existential threat to the industry (that was postwar). The migration schemes did exist but had pretty much stopped by the early 30s, by coincidence the Empire Settlement Act was up for renewal in 1937 in OTL, so repuropsing that to ride the mining boom seemed a fairly possible change. It's not going to solve the problem, not every unemployed miner is going to want to leave their home, but it will help some and that is better than nothing. Unfortunately it probably makes things a bit nastier for those who remain, efforts are being made but if their position is that they will only work as a coal miner and only in a certain small area (which in many cases has no economic coal reserves in it) public sympathy is going to fast evaporate. The Nottinghamshire union did end up merging back into the national federation in 1937, here I thought it would be more interesting if they went and joined the LSD to give them a bit more union muscle and the left-wing credibility that miners bring to a socialist movement.

The Imperial Trade Council is a new Butterfly thing and like the Committee of Imperial Defence and a few other bodies it is going to become important. Nev and co. were not very Empire minded so that side of things atrophied in OTL and then just fell apart during the war, in Butterfly much more attention is being paid to it due to different personalities, Imperial Free Trade being a thing, the different threats (Japan no Germany), etc.

El Pip · Jul 14, 2024

Chapter CLXII: Digging the Same Holes

The 1930s was one of the golden era of global cartels, the trade in commodities and products as varied as tea, steel and light bulbs were controlled by international agreements of varying degrees of integrity and legality. All else being equal a commodity as strategic as coal should have developed at least an informal producers deal if not a full blown international control council, yet this singularly failed to happen. This was not due to a lack of will, the two largest exporters (Britain and Germany) were keen on a deal in order to stabilise market share and increase export earnings respectively, while even importing nations were cautiously in favour. The example of Scandinavia explains this well, traditionally a majority British market it had been heavily contested first by the Polish and then German exporters, both of whom engaged in 'dumping', the practice of selling a product at below production costs just to make a sale. Multiple parties competing for a market normally benefits the consumer/importer and certainly it kept prices low, however no market stands alone and this is particularly true in the complex world of 'managed' trade. The British reaction was therefore not to also sell at a loss, but to threaten all involved with trade retaliation elsewhere. In the case of the Polish attempt to claim coal market share in Sweden the British Board of Trade reminded Sweden that such a change would disrupt the Anglo-Swedish balance of trade, the clear implication being that Britain would impose higher tariffs and lower quotas on Swedish exports to restore the balance. Pressure was also applied on the Polish side, a great deal of Poland's seaborne export trade depended on British shipping and even a portion of the over-land relied on British trade financing. The matter was eventually resolved with a Polish-British coal agreement restricting Polish exports outside of their 'local' markets in Central Europe but at a more sustainable price, however had any party dug their heels in things could easily of escalated. Given the regularity with which such flares up occurred it should be clear why even the importer nations could prefer dealing with a stable cartel to regularly teetering on the edge of a trade war over a few pence a tonne on the price of coal.

The impressive coal tipper loading bridge in the coal port of Born in the south Netherlands, the tipper was designed to transfer up to 800,000 tons a year of coal from railway wagons onto the coal barges of the Juliana Canal. Prior to the Great War the Netherlands had limited domestic coal production and so was a major importer, but by the late 1930s the mines of South Limburg were a significant exporter even if the country as a whole was still a net coal importer. The Juliana Canal itself was part of this effort, bypassing an unnavigable section of the Maas River it connected the new coal mines to the rest of the county's waterways, the Rhine and eventually the North Sea. This connection was important due to the economics of bulk logistics of the period; coal was incredibly cheap to ship by water, tolerably costly by rail and uneconomic for anything but local distribution by road. These logistical points were a notable factor in the various coal related discussions, much of the final 'price' of coal was transportations costs, though in many cases the imperatives of strategy and politics would trump economic concerns.

As the two largest exporters Britain and Germany had taken the lead in the cartel formation talks which begun in the aftermath of the Depression, however they soon stalled due to German complaints that British industry lacked 'group responsibility' and was not organised enough. The German coal industry had long been organised into a series of syndicates and for export purposes it was RWKS (Rheinisch-Westfälisches Kohlen-Syndikat, the Rhenish-Westphalian Coal Syndicate) that took the lead. The RWKS wanted to deal with a body that was their British equivalent, one that not only had the authority to do a deal but the power to follow through on it by managing national quotas and, if necessary, enforcing penalties. This requirement throws an interesting perspective on the UK government policy around coal in the early 1930s, the centralisation and forming of sales syndicates had very neatly re-organised the industry in a very international cartel compatible way. These re-organisation efforts took some time so the first round of detailed Anglo-German negotiations only started in late 1935, at which point they were comprehensively derailed by the outbreak of the Abyssinian War, then the Spanish Civil War and finally the Rhineland Crisis. These events were so disruptive because they undermined one of the fundamental assumptions of the cartel, that those involved had the market power to divide up regions, agree quotas and then impose them on everyone else. Prior to the Abyssinian War Britain had been exporting over 5 million tons a year of coal to Italy making it the second largest market after France. That trade had obviously stopped with the outbreak of war and under orders from Mussolini it had not resumed after the peace treaty. The Spanish Civil War not only disrupted a million ton a year market but also made any shipping through the Western Mediterranean far more complex, while the Rhineland Crisis had caused many in France and Germany to seriously re-consider the strategic risks around the cross-border Lorraine-Rhine iron-steel complex. Aside from the technical matters of penalties and adjustment mechanisms much of the cartel talks had been focused on quotas and market share, with various previous years figures being proposed as the base, the exact year normally being the one that most favoured the interests of the proposer. These arguments became irrelevant in light of the new realities, it did not matter what share of the Italian market the cartel decided to allocate to UK exporters as the practical figure would be zero. While the talks continued there was little enthusiasm for them, a limited bilateral coal deal was considered the most likely outcome and even that would have to operate within the limits set by the Standstill Agreement that controlled Anglo-German trade.

The dramatic 'revaluation' by the Gold Bloc was the catalyst that revitalised the talks, when France and Belgium effectively devalued not only did their own exports become more competitive but the francs that they paid for coal in were worth less. How much of a concern this was depend on how you valued your exports, the British concern was primarily domestic employment, so a million tons of coal could be seen as representing around 3,000 mining jobs and around 12,000 indirect jobs in the supply chain and mining towns. From this perspective as long as the export tonnage held up the reduced earnings were an annoyance but nothing more, certainly not compared to the wider economy. Another way of looking at a million tons of coal was as 1,0000 million Francs, around £13.5 million, of foreign currency that your country could earn, of course a large portion would be taken by the shippers, handling, insurance and so on, but around half would make it's way back to the exporter. Of course those were the pre-devaluation figure, after the St Leger Day massacre things changed quite dramatically. If the exporter was unlucky they had a contract fixed in Francs, in which case those 1,000 million Francs were only worth £8 million in hard currency, alternatively if the contract was tied to the 'market price' it was the importer who suddenly had to find an extra 500 francs a ton to make up the difference and many could not. Either way the exporting nation was no longer getting the same amount of hard currency it needed to pay for it's imports, which threatened yet another round of market share wars if they attempted to make up for the lower price by exporting a greater volume. Keen to avoid this outcome both sides re-engaged with the cartel negotiations with a new intensity.

The SS St Rosario of the South American Saints Line, newly launched in 1937 she was not quite as old fashioned as the SS (Steam Ship) designation would suggest; she was equipped with the White Compound Engine, in which the exhaust from the conventional four cylinder steam engine was used to power a low pressure steam turbine, a layout that dramatically increased fuel efficiency. The St Rosario worked the South Wales to South America route, carrying Welsh coal on the outward leg and bringing back grain from Brazil and the River Plate. While the devaluation of the dollar meant US coal was more competitive on price, the American government's inflexible attitude on trade deals would keep them excluded from the market and allow the British lines and traders to consolidate their position. It was not all bad for US coal exporters, with British merchants forced out of Ireland by the Coal-Cattle War American interests had been quick to seize the opportunity and a US East Coast to Ireland coal route was soon well established.

Any international cartel has to deal with politics and diplomacy, however the re-started Anglo-German cartel talks soon established that any agreement would essentially be entirely political. To the reluctance of the Foreign Office, and the delight of the German Foreign Ministry, the talks were escalated up to government level and expanded to include all the major exporters and importers. The case of Italy provides a good example of the contortions politics was forcing on the coal market, as mentioned Britain had been banned and Mussolini was unwilling to become further dependent on Germany due to ongoing tensions in Austria and the Balkans. The ongoing Spanish Civil War made transiting the Straits of Gibraltar challenging, maritime insurers were imposing 'war zone' premiums on all shipping and some were just refusing to offer coverage. These constraints resulted in the Italian market being assigned to Poland and the Netherlands, initially via France but eventually on regular convoys through the Straits under escort. Aside from the direct links a side effect of the arrangement was the forging of links between the French associated Little Entente and Italy, Italian exports and barter deals that had been used to earn Sterling to pay for Coal were diverted to France and Poland. An interesting sub-agreement meant Poland could rapidly recycle a portion of their Italian earnings into Francs, on the provision they were used to buy iron ore from French North Africa, a vital concession as Poland had typically used the hard currency from coal sales to fund iron ore purchases from Sweden. After the Franco-Italian agreement over Austria at the Amsterdam Conference this further strengthening of ties met the strategic objectives of both governments. Indeed relations improved to the point Rome began lobbying to be allowed back into the new Gold Bloc on the same terms as France, with the keen support of Paris.

Staying with the Italian agreement the Netherlands allocation would also have wider consequences. Included because Polish exports alone were insufficient and they were the only 'acceptable' nation who's exports could be re-routed, The Hague had agreed due to a combination of Italy paying a better price and pressure from everyone else. As noted previously the Netherlands were in the slightly strange looking position of exporting 6 million tons of coal a year, while at the same time importing 7.5 million tons of coal back in. The explanation was that in general it was high grade metallurgical coal (i.e. suitable for making coke and then steel) that was exported and lower grade thermal coal (i.e. fit for burning to make steam and electricity) that was imported, the cost difference between the two grades was such that this was a worthwhile endeavour. The coking coal sent to Italy had previously gone down the Rhine to Germany, often passing German mined thermal coal on it's way to the Netherlands, the diversion unbalanced this trade logistically but more importantly financially. The German solution was somewhat dramatic, they cancelled the thermal coal exports not out of pique but to manage their own domestic coal shortages. That a coal powerhouse such as Germany was experience shortages was a testimony to too things; the desperate government push to export to earn foreign exchange and the voracious appetite for coal of the German synthetic fuel industry; by late 1937 the various coal-to-oil plants were using 6.5 million tons a year and that was predicted to at least quadruple in the following few years as more capacity came online. Cutting exports to Holland 'balanced' the lost Dutch coking coal, at the cost of problems elsewhere we shall look at later, but in the immediate term left both Germany and the Netherlands short on coal. These 'new' quotas were allocated to the UK, in tonnage terms at least replacing the lost Italian markets but again forcing a re-orientation of trade links, in this case British trade was diverted away from Italy and towards it's two new partners who now had a need to earn extra Sterling.

The final system was something of a mixed bag as far as the British government was concerned. In terms of it's notional purpose it was a tentative success, UK mines had come out with generous quotas and many were looking forward to dealing with the perceived to be fair and reliable Dutch rather than fighting to get payment out of Mussolini's Italy. The success was qualified because the system was complex and political, while it had broad support (or grudging acceptance) any shift in the diplomatic balance of power could cause it to collapse again. On the diplomatic front the Foreign Office was trying to be hopeful about the vague fluttering of Anglo-French co-operation around Spain, the Royal Navy and Marine Nationale were to jointly patrol the seas around the Straits to reassure neutrals that the route was safe for vessels just passing through as opposed to trying to deliver. The lingering Francophile faction hoped to use the necessary regular co-ordination meetings to improve communications with their opposite numbers and demonstrate to a doubtful government and nation the value of a strong relationship with France. In reality however France was increasingly looking towards Rome and not across the Channel, while London had once again been semi-unwillingly pushed into a deeper commercial relationship with Berlin, the delight of the German Foreign Ministry at this turn of events being inversely proportional to the disquiet in the Foreign Office. The only truly bright spot was the prospect of stronger trade links with the Netherlands was the, a potential source of leverage to try and get The Hague out of the Gold Bloc and into the Sterling Area and perhaps even a Far Eastern alliance. Overall however it must be said the main government reaction was one of relief along with a hope they would not be forced into discussing the coal trade for quite some time, and by this measure at least the system delivered.

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Notes:
Shorter than expected while still containing actual plot, diplomatic plot no less.

There was a coal cartel in the late 1930s, Anglo-German talks did start 1935 but never got disrupted and agreements were reached to carve up the market which somewhat got enforced. Poland was a wild card, they were less fussed about profit and more about getting some hard currency, an interesting approach to exports we shall be looking at later. German coal shortages were a thing, OTL Germany juggled domestic shortage and being an unreliable supplier from 1937 onwards depending on who was shouting louder, the coal-to-oil plants ate a huge amount of coal which only got worse.

Dutch and indeed the Germans did import and export coal at the same time, partly due to grade and partly transport costs. OTL UK coal was imported into Hamburg and the 'north German markets', about 3.5/4 million ton a year by the late 1930s, in that case because there was no cheap way to get German coal to that part of the country as it wasn't connected by canal/river to the Ruhr.

Ireland never imported US coal, here they are and it's a dodgy credit based trade as Ireland can only really export things the US doesn't want or need. But American-Irish feeling and optimism are bridging the gap for now.

I spent too much time looking at the Saints Line and their funky engines, very clever way to make coal more efficient but ultimately not as good as a diesel MV. Interesting though. Theologically I'm not sure St Rosario works, but it was the name they picked.

El Pip · Oct 14, 2024

Chapter CLXIII: The Trials of Prometheus

In late 1937 the SS Krakow arrived in Ryojun, formerly known as Port Arthur, the main port of the grandly titled Empire of Great Manchuria, the Japanese puppet state that in theory was in control of Manchuria. While it was not unknown for European merchant ships to visit the port, delivering industrial cargoes and picking up the agricultural exports which were being used to pay for them, a Polish flagged vessels was unprecedented. This was as nothing compared to the unusual cargo, the ship's holds were filled with tens of thousands of rifles, millions of rounds of ammunition and dozens of heavy machine guns and mortars, none of which could be found on the shipping manifest or any of the paperwork. As soon as the ship docked it was surrounded by troops of the Kempeitai, the military police of the Imperial Japanese Army that actually ran Manchuria. Typically a foreign ship bringing in undeclared weapons could expect to see the crew arrested and the cargo impounded, but the Kempeitai instead greeted the ship's passengers warmly and secured the dock while an IJA labour battalion transferred the weapons to a waiting train. The train made it's way across the Manchukuo National Railway to the border city of Shanhaiguan, through the adjacent semi-recognised state of East Hebei and on towards the Republic of China proper. After a tense but professional handover the Kempeitai departed leaving behind a few passengers and the Polish contingent with their cargo. The next leg of the journey began by train but had to be completed by lorry, along the old Silk Road routes to Tunhwang, in Kansu Province in the North West of China. The weapons were unloaded and transported to nearby military camps, where the Polish instructors introduced the troops to their new weapons under the watchful eye of a range officers; uniforms from the Republic of China, all the main Chinese cliques, several Japanese puppets and even Imperial Russian were all present. That journey is the story of how the Sinkiang Legion, a mixed band of Cossacks, Mongolian Cavalry, Khazaks, mercenaries and loyal volunteers led by White Russian officers, ended up being armed with ancient British, French and even Russian weapons. The reasons why those involved in the effort decided to make the effort to create, arm and train such a force is the subject of the rest of this chapter.

A map of the region produced by the Raj's Survey of India, showing Sinkiang Province and it's neighbours. Located in the far north west of China it shared borders with the Soviet Union, British India, Afghanistan, Tibet and Mongolia, this strategic position meant it had been one of the playing boards of the Great Game. Britain, or more precisely The Raj, maintained an interest in the region, the town of Kashgar in the far west of the province still boasted a fully staffed British consulate which acted as a source of intelligence, advice, support and even weapons for various factions.

The historiographical debates about whether the events in Sinkiang in the 1930s were a continuation of the original Victorian era Great Game, a second round with different players or something else entirely need not detain us, a brief summary is more than sufficient. Sinkiang was arguably the most remote and distant province from the Chinese heartlands, aside from distance the cultural and religious divisions inside the province were stark. Indeed it was only one province on official paper in Nanjing, in reality the provincial governor's writ only covered the northern half of the province, the south was the under the control of the warlords of the Ma Clique and was carving out a new identity as Tunganistan. This in itself was unremarkable, the 'official' provincial governor, Sheng Shicai, was himself a warlord with an associated Clique and had the conflict just been between two factions vying for control of the province it would not have attracted any international attention or our interest. The crucial point was that Governor Shicai's principal loyalty was not to the Kuomintang, China or even his Clique, but to Moscow and Stalin. Soviet interest in the region was not just the usual paranoid desire for more 'buffer states' and, despite the propaganda claims, was certainly not motivated by a fraternal desire to spread the revolution. The Soviet motivation was simple; resources. Sinkiang had long been coveted for it's vast mineral wealth, the gold, silver and iron reserves were well known and rapidly exploited by Soviet controlled 'joint ventures' that never quite managed to generate shared profits, despite the leaps in output and exports back to the Soviet Union. As the Soviet geological teams began reporting back the province was soon elevated in Soviet planning, the discovery of rich deposits of oil, tin, tungsten and beryllium made it strategically important. In a few short years the Sinkiang Clique, like many before them, discovered that Soviet friendship was very much a one way street; Soviet 'advisers' outnumbered his own forces, GOSPLAN had 'integrated' Sinkiang into the Soviet Five Year Plan and taken direct control of the economy, the Soviet Consul General had effective veto over all government decisions and as a result the region was a Soviet colony in all but name. Given this history it is unclear if the Sinkiang purges were ordered by Shicai or imposed on him by Moscow, either way they were the final straw and pushed the province into open revolt. The mutiny of the 6th Uyghur Division transformed the revolt into a full blown war, one that the Ma Clique was quick to join by committing it's own elite troops the New 36th Division, mutual hatred of Soviet (Russian) influence overcoming the other differences. The Soviets themselves, in accordance with their many treaties of universal peace and friendship, mobilised their own 'advisory' troops to defend their puppet and then expand their influence over the rest of the province.

When news of the conflict reached the Chinese capital Nanjing there was a strong temptation to ignore the whole affair, Soviet influence over Sinkiang was viewed as not that different from the Concessions on the coast, officially intolerable impositions but in practice low priority annoyances. The governing Kuomintang was also very distracted by more urgent issues; the fight against the Chinese Communist Party was still far from over, the warlords and Cliques were pushing back against the 'disgusting and malignant British influence' in the Customs and Treasury (i.e. central government taxes having to be paid and the most obvious and gross corruption being challenged) and there was of course Japan. The anomaly of East Hebei, more formally (if incorrectly) the East Hebei Autonomous Anti-Communist Independent Government, was mentioned earlier and was the subject of the first tentative rapprochement efforts from Tokyo. Established as a neutral and demilitarised buffer state it had become a Japanese puppet state in all but name, that last detail was important as it left open the possibility that it could go back to being a neutral buffer without any official diplomatic changes. The needle that Tokyo was trying to thread was giving China and the Kuomintang a win by removing the pro-Japanese collaborators without Japan losing face or provoking a domestic 'Incident' back home. The Kuomintang were not opposed to such a deal, Chiang Kai-shek strongly believed China needed to focus on the communists and then other internal enemies before facing external threats, so peaceful relations with Japan were preferred, in the short term at least. This was view was far from universal and the Nationalists were under considerable domestic pressure to push back, as a result the Kuomintang had deployed a great deal of their most reliable troops around the East Hebei and Manchurian borders, to show they were guarding against the possibility of "Japanese treachery" and would not give up another inch of China. With those commitments, the troops being sent to reinforce the Northeastern Army containing the Communist remnants in Yan'An and the brutal reality that none of the warlord states would risk weakening their own position by sending troops out west, Nanjing resigned itself to a diplomatic response to Sinkiang and trying to get a face saving statement out of the Soviets.

Posters for the Soviet film 'Turksib' about the construction of the Turkestan-Siberian railway which ran through Kazakhstan on the Sinkiang border. The Turksib featured heavily in Soviet propaganda, especially that made for internal consumption, because it matched the story the leadership wished to tell. A heroic feat of engineering and industry, workers from across the Soviet Union toiling together to bring modernity and civilisation to all. What did not feature was the parallel efforts to collectivise and socialise the nomadic Kazakh people, in the resulting famine 1.8 million died, almost 40% of the population, and another million fled to neighbouring republics or across the border into China, Afghanistan and Mongolia.

This gloomy prognosis was not shared elsewhere, several groups in Poland and Japan came to the conclusion that the conflict was both of the right type and occurring at the right time. The timing point was simple, the Soviet Union was being racked by the Great Purge which was tearing through the country, the military and even the NKVD, while also inspiring similar purges in the Soviet puppets in the region. Any response from Moscow would be heavily hampered by the paralysis and paranoia the purge was inducing, as well as the weakening of the army and intelligence services due to loss of so many experienced personnel. The type of conflict is a more interesting point, it was an article of faith among many of the Soviet's enemies that the USSR was held together only by force and that the non-Russian minorities yearned for freedom from Moscow. It was the fundamental basis of the Polish 'Prometheism' project, which supported national independence movements across the USSR as a way to weaken Moscow. While the project had dropped in priority at the start of the decade, due to the Depression restricting funding and the apparently more serious German threat, a recovering economy and the humiliations of Germany during the Rhineland Crisis had seen Warsaw's look again at the old enemy of Russia. The Japanese had similar beliefs so, alongside the considerable individual efforts of the Japanese Army along the border, had established the Bõryaku Kikan (Subversion Organisation) to direct their overseas efforts to support minority groups in the USSR. The Sinkiang conflict was considered particularly promising in this regard, the majority of the province were Muslim Uyghurs who the theory suggested would fight hard to resist atheist Soviet control, particularly given the example of how Moscow had treated the Khazaks, Mongols and other non-Russian groups in the region. This led to the main reason for foreign support and interest in Sinkiang, the wider consequences of a defeat for the Soviets. At it's most basic pushing Moscow back would prove that such a thing could be done and, it was hoped, encourage other resistance movements elsewhere. Even if no actual revolts occurred it would force the Soviet to put efforts into suppressing Central Asia, at a time when due to the purges they were already spread thin, hopefully opening up opportunities elsewhere. The more ambitious even looked to do unto the Soviets what they had done to others; deniable interventions to aid nationalist rebels and undermine central control, though after the Kanchazu Island incident such people were understandably in a minority.

In terms of equipment and motivation Japan could have supplied and trained the Sinkiang Legion alone, they also had a number of puppet organisation that could provide motivated non-Japanese manpower, what they lacked was a relationship with China that would ever allow that to happen; Nanjing had an entirely justified distrust of Japanese intentions. Thus we come to the Polish aspects of the affair, Polish-Japanese relations had been strong since before the Russo-Japanese War and Japanese diplomats had argued in favour of a strong Poland at Versailles. A mutual hatred of the Russians had seamlessly transferred to the Soviets and the two nations shared intelligence on the Soviets, organised training (particularly the training of Japanese cryptologists by Polish experts) and co-operated on supporting resistance groups and inserting agents into the USSR. Crucially Warsaw had kept up its relations with China so the Polish consulate became the main channel of communication, able to get an audience and be listened to when a Japanese emissary would not. The negotiations were far from simple, as has been mentioned many major players in China fundamentally disagreed with the idea of prioritising internal threats over fighting Japan, not least because they correctly feared that meant reducing the power of local governors/warlords. However the strengthening economy following the Leith-Ross mission had brought Chiang and his Clique a considerable amount of political credit and none of the warlords, not even those with Communist sympathies, actually wanted to see the Soviet Union annex a part of China. The fact the plan did not involve weakening forces on the border with Japan or any actual commitments or efforts from the other Cliques was also a factor in it's favour, as was a certain degree of cynical support from certain sections; those convinced it was a Japanese plot and who wanted to use the 'inevitable' Japanese treachery to force a war with Japan against Chiang's wishes.

The raising of the flag at the Polish Consulate in Harbin, Manchuria. The Polish connection to the Far East dated back to the days of the Tsars, the Chinese Eastern Railway had been planned by Imperial Russia and financed by the French and the Belgians, but it had been engineered and designed by Poles. Several thousand had stayed on to run the railway and negotiated several privileges for their community, while not as far reaching as those in the coastal Concessions they were considerable and somewhat justified the claims to be a colony. The Poles were not the only ones to stay, there was a large 'White Russian' community in Harbin and the mutual hatred of the Soviets was enough to smooth over their other disagreements. Following the invasion of Manchuria by Japan Harbin became the favoured location for Japanese-Polish intelligence conferences, unsurprisingly the town was particularly busy in the autumn of 1937.

It is illuminating to note that one of the main breakthroughs in the talks came from an imposition of an extra demand, when the scheme had started Warsaw had expected to merely facilitate the talks and dump a load of small arms it had been trying unsuccessfully to sell for many years. However the need for trainers, and the entirely reasonable refusal of Nanjing to allow entry to Imperial Japanese Army troops, meant a Polish Military Mission would be required. This soon escalated into an escort for the weapons while in transit and a quasi-guarantor role that they would not get diverted. This increasing commitment prompted the Polish Foreign Office to raise the issue of the Polish communities in Shanghai and Tianjin, while not asking for a formal Concession they did ask for those groups to be given the rights and recognitions that the Poles in Harbin had enjoyed when under Chinese control. In deference to Chinese internal politics these would be mutually applied, though all involved knew there was essentially no Chinese community in Poland that could benefit. However this offer did advance the talks, because it meant Poland now had something to gain from success and more importantly something to lose if it was a Japanese scheme. Many of the factions had been suspicious of Poland just acting out of opposition to the Soviets, whereas a European power that wanted better access to China was something they were far more familiar with. The final deal itself was essentially a list of conditions on what the Poles and Japanese could and couldn't do, with a very heavy emphasis on the latter, along with details of when the mutual rights recognition treaty between Poland and China would come into force.

While all these talks had been ongoing the conflict in Sinkiang had continued. Initially the rebels, or as they dubbed themselves 'Loyalists' (because they were loyal to Nanjing and China), had the advantage and, after clearing the south of any groups that were not joining the uprising, had pushed north and defeated Shicai's troops in the Battle of Karashar. This was their high water mark as by August the first Soviet troops arrived in the province, Moscow having concluded that the Chinese government was not going to intervene and that they did not want to lose their puppet Shicai and the resources of his province. While an NKVD detachment stayed in the capital and accelerated the ongoing purge, not least of the previous Soviet representatives who's failure to stop the rebellion was ascribed to a conspiracy and wrecking, the Red Army pushed south. While relatively few in number, around 5,000 men strong, the force included a tank regiment and organic air support which more than compensated. The Soviet force pushed the loyalists out of Karashar and then massacred the Ma Clique's cavalry heavy army on the empty plans of the Tarmin Basin, in less than a month they had re-established the old de facto boundaries and were looking to push on to take the entire province. The Soviet arrival had coincided with the first shipments reaching Tunhwang and the formation of the Sinkiang Legion, despite plans to properly train this force it ended up being hurled into battle to try and stabilise the situation. Perhaps fortunately they entered Sinkiang from the east and the Soviet air bases had been established in the West to fight the Ma Clique, so the Legion could at least fight under neutral skies. The Legion also had the benefit of actual anti-tank weaponry, the machine guns provided by Poland may have been old but they were still capable of chewing through the thin armour on a Soviet BT-series tank. These advantages, along with a degree of over-confidence amongst the Soviets, were enough to see the Legion victorious and the Soviet's pushed back across the Tian Shan mountains and into north Sinkiang. Casualties on both sides had been high and the commanders were quick to call for reinforcements, requests which soon became as much political as they were military.

The Fiat CR.40, a variant of the proven CR.32 the most obvious changes are the very low mounted upper wing and the large cylindrical cowl indicating a change to a radial engine. It was the latter which attracted the attention of the Chinese Nationalist Air Force, while the manoeuvrability and firepower of the CR.32 had been much appreciated it's temperamental Fiat A.30 V12 engine and it's unusual petrol/alcohol/benzene fuel requirements had made it a maintenance and logistic nightmare. Keen to get something into production quickly the Chinese acquired the prototype and started manufacture in the Sino-Italian National Aircraft Works in Nanchang, with a not inconsiderable degree of support and parts from the Fiat factories in Italy. Unusually the 'export' version proved superior to the original, the lack of radial Italian engines had forced Fiat to use a Bristol Mercury IV acquired prior to the war, the Chinese were able to fit the almost twice as powerful Mercury VIII which they obtained through their trade links with Britain. The first CR.40s would come off the production line in the summer of 1937 and, despite repeated requests to send them to Sinkiang, they were sent to reinforce the forces on the border with Japan, a clear demonstration of where Nanjing's priorities lay.

While Moscow would weigh up the options and eventually decide to double down and send reinforcements, the problem in Nanjing was finding any troops to send. The local warlords were raising new troops, on the basis they had no idea quite where the Soviets intended to stop, but these would take time to train and equip. What was needed were already trained troops to hold the line, which prompted the first major test of the Sino-Polish-Japanese arrangement. While actual Japanese troops were obviously unacceptable and Poland was never going to send any 'volunteers' there were still a range of other options. Japan had a number of associated non-Japanese forces who were already trained and had their own motivations in wanting to fight. The most obvious group were the White Russians in Manchuria, most of whom had combat experience from the Russian Civil War and Great War which had been supplemented by training from the Imperial Japanese Army. The success of the European based White Russian movement in actually fighting the Soviets, even though it was in Spain, had spurred on their Far Eastern counterparts and prompted a wave of volunteers into the IJA organised Asano Brigade. While too few to make much of a difference as an infantry unit, they were an excellent source of trainers, specialists and commanders. At the other extreme, both of experience and acceptability, was the Grand Han Righteous Army, six thousand unemployed former Chinese Army soldiers recruited by a turncoat general into Japanese service. With Tokyo now seeking better relations an army of Chinese traitors, as Nanjing would view them, had become an inconvenient embarrassment and one they were happy to be rid of. The Nationalists completely disbelieved the claim that the Righteous Army wished to redeem itself by fighting to defend the ancestral lands, but due to lack of options allowed them to 'volunteer' to join the Sinkiang Legion. In between sat Prince Demchugdongrub and the Inner Mongolian Army, a Qing dynasty Imperial Mongol nobleman fortunately also known as Prince De. His faction had decided to collaborate with the Japanese as they shared an enemy, the Soviet backed Mongolian People's Republic. The issue was they also shared another enemy; the Chinese warlords who controlled Inner Mongolia. However Prince De was foresighted enough (or under tight enough control from Tokyo) that his forces were prepared to fight in Sinkiang on the basis that weakening the Soviets meant weakening their control over Mongolia. It was not just trained units that were making their way to southern Sinkiang, the conflict became a rallying point for anti-Soviet groups in the region, in particular those Khazks and Mongols who had fled the purges but still wanted revenge. The conflict even attracted the attention of the exiled Cossack Hosts, their hoped for 'rehabilitation' having been denied by Moscow and replaced by yet another round of purges they rallied to the cause purely as a way to strike back.

The Sinkiang Legion would hold it's own in the autumn of 1937, the experience and motivation of it's forces and commanders being enough to compensate for the more modern equipment and air power of the far smaller Soviet forces. Fortunately for the Legion just as the Soviet reinforcements began to arrive in early November the conflict would literally freeze up, daytime temperatures plummeting well below 0ºC while the nights could hit -20ºC or lower. The response in Nanjing was to pursue a diplomatic solution, the conflict was still viewed as a distraction and it was hoped Moscow would agree to a status quo ante bellum deal where the north of the province remained an undeclared Soviet puppet. In the paranoid atmosphere of the Great Purge these approaches were not received well, instead it was decided that failure was clearly the fault of wreckers, traitors and conspirators in the Red Army and once they had been purged the campaign could begin in the Spring and achieve the original goals. The command of the Legion itself, which had essentially taken over the south of the province as the Ma Clique withdrew back to their core territories to lick their wounds, spent the time looking to re-arm and re-equip. With the Polish armouries fast being emptied of anything of use on a modern battlefield, and with any newer production being reserved for the re-arming Polish Army, they were forced to look elsewhere. Japanese equipment remained off limits for political reasons, however with control of the province came control over the Chinese side of the passes through the Himalayas and into British India. The British consulate in Kashgar had been paying close attention to the conflict and was unsurprised when the Legion leadership approached them to ask what the position of Britain was in the conflict, what did surprise them was the request for the price of a couple of squadrons of Vickers Venoms. The response to those question would determine the next phase of the Sinkiang War.

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Notes:
A little discussed factor that limits Chinese based AARs is the fact that any province/city/word in China can have at least five translations, so there is some work involved in working out what actual place any source is referring to.

In any event, as has been discussed we are now at the stage where the effects of earlier changes become apparent. There was a revolt in Sinkiang/Xinjiang/Many other names in 1937 and the Soviet did intervene, but the Sino-Japanese war had broken out so no-one in the rest of China could do much. After a brief fight against the Ma Clique the Soviets assumed total control, until late in WW2 when China could push them out again. The Ma Clique were also referred to as the Xibei San Ma (Three Ma of the North West) which is how HOI refers to them. Obviously very different here.

On the Polish angle, the are using the interpretation of Prometheus' theft of fire being about enlightenment and the fight against tyranny. A slightly niche view of the myth but not one they invented. Obviously historically Poland was far too focused on Germany to care about this, but the colonies and interests were there. The arms they are sending out are the ones that OTL got dumped on Republican Spain, but Spain has better options in Butterfly so isn't interested, Sinkiang however is desperate. The Cossacks were hated by the Soviets for ideological reasons and got brutally 'repressed' in the 20s, OTL they got 'rehabilitated' and the Cossack Divisions of the Red Army re-created, in Butterfly they instead got caught up in the purges as unreliable non-Soviet influences so swap sides in Sinkiang.

The Sino-Italian aircraft factory was just producing it's first aircraft around the time of the outbreak of the war with Japan, it was bombed shortly after and the Chinese suspected the Italians had leaked the location. Here it is thriving as there is no Anti-Comintern Pact and Mussolini has no interest in a Japanese alliance so is keeping up the links with China. The CR.40 is an unusual looking plane that OTL was just a step to the last great biplane the CR.42, but the Chinese problems with the CR.32 and it's strange fuel did happen so here it gets sent East and gets a chance to fly and fight.

El Pip · Dec 27, 2024

Danzig or Default.

In early July 1937 the Free City of Danzig informed it's creditors it wished to renegotiate it's debts, on the basis that it expected to be entirely unable to make the full required payments. While Danzig status was very deliberately a constitutional and diplomatic fudge certain matters, like what debts it was liable for and to who, were crystal clear. As a result the well practised system for dealing with a sovereign default moved into action and, after a few headlines and brief mentions in cabinet minutes, the matter sunk into the background as the negotiations between debtor and creditors began. That the matter roared back into attention in the late autumn is due to the audacious solutions that a certain non-creditor party proposed, our interest is also in the very secret future discussions that occurred in parallel. British interest in the matter was, initially at least, entirely confined to the financiers of London, Edinburgh and Glasgow. While Danzig was effectively part of the Sterling Area (the Danzig gulden was pegged to Sterling and most of Danzig's gold reserves were stored it the Bank of England) that did not mean anyone outside the immediate creditors had any interest in the loans or any negotiations on them. To be blunt the sums involved were too small to be significant to the banking sector, let alone the wider economy, and it was believed the talks were purely commercial negotiations with no wider political or diplomatic ramifications. Such was also the reasoning of the League of Nations, while the Free City was in theory and in treaty under the protection and oversight of the League Council, in reality the League High Commissioner's were under instructions to be as 'hands off' as possible. The matter was therefore left to the London Loan Committee, a group of City of London grandees empowered by the League Council to resolve issues with League Loans in any way they saw fit, provided that did not involve the League having to make good on their earlier financial guarantees. The Loan Committee itself would therefore take on the tricky task of negotiating quite how bad a loss the bondholders would take, whether in reduction of interest rate (and thus payments), extension of time (the bond holder only making interest payments and not repaying the capital until later) or most commonly, and in the case of Danzig, both.

The striking Holborn Bars building, headquarters of the Prudential Assurance company. The Prudential had an interest in the affair as it was the joint owner of the British Overseas Bank, along with the Royal Bank of Scotland and the Union Bank of Scotland. The British Overseas Bank had been established shortly after the Great War with the stated aim of facilitating foreign trade, it did not make loans itself but specialised in the financial and legal logistics of getting foreign payments into and out of the British Imperial banking system. In the case of Danzig it mean acting as the Sterling receiving bank that transferred the loan repayments from the Bank of Danzig and distributed them to creditors in Britain, the Empire and beyond. With the Bank of England starting to ask difficult questions about the liquidity and solvency of the British Oversea Bank's operations in Spain, Germany and Hungary, the reliable fees from managing "safe" League Loans became even more important to the bank's management.

The reason that Danzig had reached the edge of default is relevant to latter events so is worth briefly exploring. The initial post-war years of the Free City had been a financial mess as many parties, not least local Danzigers, took advantage of no-one knowing quite what a League of Nations Free City was or how it worked, so taxes were generally not paid while many expenses were incurred and left for the League to pay. The League eventually got a grip on matters and a number of loans were floated in the mid 1920s to improve the utilities and infrastructure in the city, crucially this included dredging and expanding the harbour. The League's plan for Danzig was that it became the main port for Poland, this was part of the reason the city was in a customs union with Poland, and that shipping and import/export would be the main pillars of the Free City's economy. Unfortunately for the League, and the city, Poland disagreed with this plan. After the experience of the Polish-Soviet War (when German dock workers in Danzig refused to unload munitions or any other war material) Warsaw realised they did not just need access to the sea but reliable access, which mean a port they fully controlled. This realisation resulted in the near two decade project to develop the small coastal village of Gdynia into the largest and most modern port on the Baltic Sea. Gdynia was a mere 10 miles west of Danzig but that was enough to get safely into the 'Polish Corridor', the narrow strip of land that was, in theory at least, unambiguously Polish. The project would proceed in fits and starts, progress limited by both finances and a lack of indigenous skills and experience, but there was determination to make it work and the difficulties were overcome. By the late 1930s the port of Gdynia was handling twice the cargo of Danzig by volume and nearer ten times as much by value; Warsaw's policy was to push high value and strategic trades through the 'Polish' port and leave the low value bulk goods, such as agricultural exports, to Danzig. This collapse in trade also meant a fall in the various fees and charges that Danzig's docks could charge, with obvious consequences for the city's ability to pay it's debts. With this understanding of the background it should be clearer why the London Loans Committee, when it examined the matter, was concerned if the proposed debt relief was sufficient, it would serve no-one to have to revisit the matter the following year if Danzig continued to decline.

The Coal Trunk-Line in Poland under construction in the early 1930s. The new line linked the coal mines of Polish Silesia with the port of Gdynia and it's equally new bulk coal loading docks. It is somewhat ironic that a project started to free Poland of foreign dependency would end up substantially financed and owned by overseas interest. The French industrial giant Schneider-Creusot had invested heavily in the Silesian mines, the Gdynia project and, through the French-Polish Rail Association, the new railway. At a technical level the projects were a great success and Polish coal exports boomed, however at a financial level the stress of all the borrowing began to tell. The enterprises all depend on exports to earn their way, specifically hard currency exports to repay the overseas creditors, and as we have seen the coal trade was highly competitive.

This brings us to the unexpected counter-solution proposal, to put it simply the Reichsbank (Germany's Central Bank) offered to fully guarantee and under-write all of Danzig's international loans, under the original terms, should certain concessions be made to Germany about Danzig's status. Presented as a tidying up of the uncertain status of the Free City the proposed changes would have pushed Danzig right up to the limit of incorporation into Germany, while still technically leaving it as League protectorate. Danzig's foreign policy would transfer from Poland to Germany, as would control of the city's rail infrastructure, the city would also enter a customs union with Germany, the exact details of how that would work while still being in a customs union with Poland being glossed over. Poland's other rights in the city, mostly around the Westerplatte munitions depot and docking privileges, were to be retained but subject to joint oversight by the League and Berlin. From a purely banking perspective this was a very tempting offer, maintaining the full par value of the debts was of course preferable and even allowing for Germany's own patchy record of debt repayment the debts being jointly and severally guaranteed by the Reichsbank was a better security than just the City of Danzig alone. However, one did not become a City of London grandee by ignoring politics and so the Loans Committee very quickly passed the matter on to the League Council, dryly noting the economic aspect along with a clear statement that this was an entirely political decision. As we have seen previously question of irredentism and minority rights were at the top of the list of things the League Council did not wish to discuss, particularly for nationalities that had quit the League like Germany. Naturally therefore the Council attempted to kick the matter to somewhere it could safely be ignored until, hopefully, everybody lost interest and the matter could once again be forgotten. Their problem was the other bodies kept kicking it back, the Minorities Commission said that as Danzig was basically entirely German it was nothing to do with them, the Delimitation Commissions confirmed everyone agreed on the boundaries of Danzig so they had no jurisdiction and an attempt to pass the matter to the Mandates board was vetoed almost immediately by Britain and France; the Permanent Mandates Commission had safely drifted into irrelevance, resembling more a comfortable home for retired colonial governors than an active oversight group, and the last thing either power wanted was for it to be roused into activity or, worse, become a forum for groups to complain about the disposition of the Mandates. The issue eventually ended up on it's own bespoke sub-committee with the German Ambassador to Switzerland granted "Affected Party Representative" status, this status having been invented by the League Secretariat specifically so the ambassador could actually attend the meetings and address the League Assembly despite Germany not being a member state.

All of this diplomatic wrangling took so long that the actual issue had long since been resolved, the London Loans Committee agreeing a lowering of interest rates and delay to payments into the sinking fund, while Danzig had to provide a bit more security against a future default in the form of charges over more government property in the city. At first glance this may seem like a failure for Germany, but that is to assume the proposal was intended to succeed rather than merely being a diplomatic gambit. From the perspective of the German Foreign Ministry they had forced the League to once again start talking about the rights of German minorities, got a representative into the League Assembly while not having to rejoin and banked another grievance where Germany had tried to be 'reasonable' only to be blocked. More tangibly the distraction had allowed the German administrators of Danzig to accelerate the 'Nazification' of the city, most notably bringing in a local version of the Nuremberg Laws, a complete violation of the charter and constitution of the City but one which the League Commissioner in Danzig had waved through as a goodwill gesture. Even taken together none of these were particularly major successes for German diplomacy but this reflects the distinctly limited horizons of official German diplomacy under von Neurath and the traditionalists in the Reich Foreign Ministry. In their view the bombastic bluffing of von Ribbentrop and the debacle of the Rhineland had severely damaged German diplomatic credibility. Ironically for an ideology that put such value in 'Will' and decisiveness it was German resolve that was most questioned, even when her capabilities were known foreign powers still doubted that Berlin would follow through on her words and not back down if challenged. Therefore German diplomats were under orders to carry out the painstaking work of rebuilding that credibility, never promising anything that they were not certain would be delivered and prioritising regular small wins over risky gambles. From this perspective the Danzig Gambit had been a success, Germany had materially improved her position, gained some small concessions and most importantly been treated as a serious counter-party and got her concerns talked about at the highest level. It should also be noted that this incremental approach only applied to official channels, in secret talks von Neurath was prepared to be far more ambitious, audacious even, and it is likely this as much as internal Nazi politics that kept him in office.

Prudential House in Warsaw, the Eastern European hub for the Prudential Assurance company it was a very different building from it's London counterpart. An 18 story art deco skyscraper it was the tallest building in Poland and the sixth tallest in Europe when completed in 1933. It's size and fashionable appearance made is a popular symbol of 'modern Poland' and the financial industry in the country, a less complimentary comment was that it being foreign owned also made it an appropriate symbol of the 'Polish' financial sector. A popular question was why Poland had not made a counter-proposal about the Danzig loans and the answer was policy and finance. Politically Danzig was seen as already lost, the population was essentially German and Gdynia was an acceptable strategic port, so additional Polish privileges in the city of Danzig were unfeasible and unnecessary. More crucially the Polish state was in the midst of defaulting on it's own debts, while the economy was booming this was through foreign investors like Schneider-Creusot and Prudential. The actual Polish state was weighed down with debts incurred on 'strategic' projects like the armaments focused Central Industrial Area, which had a voracious appetite not just for funds but for scarce foreign currency to pay for imported machines and materials.

This brings us to the previously mentioned private discussions that accompanied the very public debt meeting. These particular secret talks were held between Germany and Poland at the instigation of Berlin and under the cover of consultation between the two powers about the economic situation in Danzig. While a number of matters were discussed the most dramatic was undoubtedly the German proposal about a long term solution to the Polish Corridor issue, an issue that seemed intractable due to the contradictory demands of the two nations. Berlin proposed to bypass all of those issues by getting Poland access to the sea from elsewhere, specifically via Lithuania, so she would no longer need the corridor and could return it to Germany. Having just discussed Germany's relative lack of diplomatic credibility this seems quite a leap, but it should be emphasised it was only a small part of the discussions and a long term aspiration not a short term plan. The German diplomats instead focused on the surprisingly numerous areas of German-Polish agreement, starting with their mutual dissatisfaction with their neighbours and hopes for territorial 'corrections' in the region. Diplomatically the two nations had a number of common adversaries, alongside Lithuania they both had claims on areas of Czechoslovakia and had made very public complaints about the Czech treatment of minority groups. Co-operating and co-ordinating their efforts would be more effective than either working alone, which would increase the pressure on Prague to agree to the proposed adjustments to the borders. Far less dramatically, but of greater immediate interest to Warsaw, the potential for economic co-operation was also discussed. Poland was still officially a member of the Gold Bloc but even after the 'revaluation' of gold by the Bloc the economy was still struggling and only regular support from the Banque de France was keeping the speculators at bay. The revaluation had made Polish exports more competitive on the wider global market, but to some extent that was just catching up with earlier devaluations. It also had no effect on intra-bloc trade as those rates were unchanged, all currencies still being tied to gold. As noted French firms had heavily invested in Poland and it was widely believed that Paris' support for Poland's continued membership of the Bloc was more to do with securing those repayments than any benefit for Poland. While the German negotiators did not propose anything as dramatic as Poland leaving the Bloc, they did suggest that moving some of Poland's trade to the German method of inter-government bartering would entirely avoid the problems of tariffs, quotas and exchange rates that dogged Poland's more conventional trade.

The Polish Foreign Office was quick to notice the common thread of these proposals, they all involved weakening or breaking Warsaw's ties to Poland's New Entente allies, France and Czechoslovakia and most of them would also damage relations with the Little Entente as well. This did not mean they were rejected however, Poland was gravely disappointed in the New Entente as it had not lived up to their somewhat unreasonable expectations. It was a cornerstone of Polish foreign policy that Poland was one of the pre-eminent powers in the region, should be treated as such by her neighbours and should be the prime mover and leader in any regional alliance or block. This was not a view shared by her neighbours who viewed her as a peer at best, with many thinking it was Poland who should look to them for leadership not the other way round. This mismatch accounts for the failure of Poland's many ambitious schemes in the period, from the dream of the Intermarium (an alliance of Eastern European states stretching from the Baltic to the Black Sea) to the more limited 'Third Europe' of just her neighbours, all of Warsaw's schemes assumed and required Polish leadership and every time this was utterly unacceptable to everyone else. It was therefore unsurprising that the New Entente was another disappointment, while Warsaw was not so far gone as to think the French would bow to their leadership, they had expected a strong Warsaw-Paris core with the Czechs and then the Little Entente doing what they were told. It was believed this would be a forum for discussion on vital matters of Franco-Polish interest, like a new set of massive loans to fund the next stage of Polish industrialisation and French support for Poland's various foreign policy plans. Instead the French had treated everyone as equals and worse wasted time discussing unimportant details, such as Poland resolving it's current debt default and starting to repay old loans before it got any new ones, or Poland honouring the terms of existing licence agreements as a prerequisite for discussions on licences for the next generation of equipment. What Warsaw wanted was leverage, but after their aggressive approach to default negotiations both Britain and America had blackballed the country for more credit, leaving Paris as the only option that had both the funds and any interest in offering them at non-commercial rates for 'strategic' reasons. From this perspective closer commercial links with Germany, or even the threat of them, seemed attractive as a way to put pressure on the French. It must also be admitted that much of the Polish political establishment was more comfortable being at odds with the Czechs than trying to be allies, so working with Germany to raise 'minority rights' complaints also appealed. The change should not be overstated, Poland remained in the New Entente and was still committed to the Gold Bloc as a sign of the power and modernity of the Polish economy, but the first Polish-German barter agreement would be signed that autumn as would the first demand for action about the Czechoslovakian government's treatment of non-Czechs and the statement from Berlin affirming it's support for Poland in the Vilnius Dispute and the need for a wider negotiation on Lithuania's minority and border disputes with her neighbours. It is interesting to note one area that was not discussed, despite the ongoing talks between the Japanese embassy in Berlin and the Dienststelle Ribbentrop (Ribbentrop's Special Bureau) about an Anti-Comintern agreement of some kind to include Germany, Japan and Poland the matter was not raised. This is a sign both of von Ribbentrop's continued isolation from foreign affairs after his earlier failings and the compartmentalisation of Nazi government, as the Foreign Ministry did not approve of those talks (due to concerns about it compromising Germany's position in China) they had just refused to do anything about it and, in the absence of a directive from Hitler, could not be forced into action.

A streamlined and still brand new LMS Coronation Scot locomotive with Tsar Boris II of Bulgaria at the controls, the Tsar taking advantage of a royal visit to Britain to indulge his favourite hobby of driving trains as fast as possible. In this case he managed to get the engine up to 88mph, a new personal record but thankfully well short of the 114mph the engine had hit during trials in the summer, the shear novelty of the achievement being enough for the incident to make the news from Australia to America. There was a more serious purpose to the trip beyond locomotive driving, the Tsar and his advisors would be discussing trade, regional diplomacy, investment and re-armament with the British government and the many Imperial and international bodies based in London. Unfortunately for Boris and Bulgaria they would find all those issues linked back to the one thing they did not want to talk about, debt.

The Danzig loans were not the only matter the London Loan Committee had to consider that autumn, Bulgaria has been in default on it's League of Nations organised loan since 1933 and with the Bulgarian state visit to the UK another effort was being made to resolve the matter. Where Danzig represented the mostly conventional approach of negotiation and revised terms, Bulgaria had opted for a very different approach to defaulting on a loan, namely refusing to engage with the creditors and instead only paying as much interest as Sofia felt was fair and affordable at that particular point. Unsurprisingly the 'fair' payments were only a small fraction of what was owed or what the country could actually afford had it made the effort, which was the prime advantage to the approach. The initial disadvantage was being frozen out of the international debt market, but as the country has no further borrowing or foreign currency needs this was not a serious issue, while the diplomatic disapproval from the League and creditor friendly governments was not an especially serious deterrent. The consequence that Bulgaria had not properly anticipated was the impact on all other forms of credit, such as trade finance, shipping and even fuel bunkerage. The key problem was that Bulgaria was seen as being unwilling to pay rather than unable, which was indeed the case, and that was a far greater sin that mere default or financial crisis. A record of an inability to pay could be mitigated through collateral or guarantees, perhaps at a higher rate or less favourable terms but there would always be someone who would facilitate such trades, while new loans on the promise of economic reform were a League staple by this point. A government unwillingness to pay however undermined even collateral, after all a claimant would have to go through the courts and bodies of the state to make claim on the collateral and if the state itself was unreliable then that became a very uncertain proposition. As a result anyone trading with Bulgaria quite reasonably demanded payment up front while paying their own bills only at the end, which was a problem for a nation seriously short of foreign exchange and which lacked working capital even it's own currency. The State Visit to London had been an attempt to break this impasse and convince Britain to re-establish trade links, starting with a resumption of Bulgarian agricultural exports backed by guarantees from both governments. With Bulgaria black listed by the Credit Export Guarantee Department due to it's cavalier attitude to it's past debts, and it's refusal to reconsider it's position on the matter, this would have required Board of Trade intervention and a political-diplomatic decision that Anglo-Bulgarian trade was of such importance it needed quotas and government support. Unsurprisingly this was not forthcoming, Britain already had reliable suppliers from within the Sterling Zone and had no desire to disrupt those carefully balanced trades for the benefit of Bulgaria. To the extent Britain had interests in the region they were concentrated on keeping the Soviet fleet bottled up in the Black Sea and the challenge of trying to keep good relations with Greece and Turkey simultaneously. Bulgaria would be no help with the former and her loud irredentism over Macedonia and Thrace meant she was actively unhelpful for the latter, so there was not even a strategic case for trying to improve relations. It was this rejection, as well as a matching one from Paris for broadly similar reasons, that would see Bulgaria pulled tighter into Germany's economic system as bartering and physical swaps did not rely on credit or finance, or at least not explicitly. The risks and costs still existed in such trades but a government to government deal meant the entire trade had an implicit state guarantee, even if those negotiating it were not consciously aware of it, and much of the transport cost and risk could be dumped onto state railways and lost in the overall national budget. This had been the outcome that Boris' diplomacy had been trying to avoid, Germany already accounted for 40% of Bulgaria's trade but before the end of the decade it would reach 70%, Bulgarian tobacco, wheat and vegetables being trade for fertilizers, manufactured goods and eventually arms. The Bulgarian government was well aware of the risks of such dependency but, while it could identify the need for diverse trade partners, it could not take the steps necessary to allow it. Ultimately being dragged deeper into Berlin's 'Exchange Rate Control Bloc' was an easier option than facing up to their debts and making the necessary reforms. The German government was less interested in why nations joined preferring to focus on the simpler fact that they had and what followed, so the Reich Foreign Ministry saw marked it up as yet another success for the autumn. As with Poland the deals with Bulgaria were seen as just the start of the relationship, Britain may have had little interest in South Eastern Europe but the German government believed that having an irredentist dictatorship economically dependent on Berlin offered all sorts of valuable opportunities.

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Notes:
A Danzig Crisis! Of sorts anyway. Danzig did default in OTL for the reasons stated, but it just got tidied up with an interest rate cut and an extension of the loans. There were certainly plans in the 1920s to give Poland a port in Lithuania, everyone knew the Danzig/Polish Corridor solution was not especially stable so a rebuilt Polish-Lithuanian Commonwealth was considered, however the Lithuanians really weren't keen. German-Poland relationships are interesting at this point. Weimar Germany spent the last years of it's existence in a bitter economic tariff/trade war with Poland to try and pressure them into giving up Danzig and the corridor. Then Hitler comes to power, ends that conflict, signs a 10 year treaty of German-Polish friendship and spends years making speeches about how amazing that deal was and how it proves what two 'strong men' can do without democracy getting in the way, even as late as January 1939 he was boasting about it. I think it is an under-rated reasons why he got away with so much, he had been 'reasonable' about it and appeared to defuse a powder keg issue. All lies and misdirection obviously, but if you were already inclined to appeasement and inaction it was helpful 'proof' that Hitler would negotiate and keep to a deal.

The Polish government knew it was facing a tricky balancing act between the Soviets and Germany, it also knew more allies would aid in that, however they insisted on leading anything and no-one else wanted them to lead. There were many reasons for this; the Polish habit of starting border disputes, the Polish belief that licence agreements were just worthless paper and the fact the Polish economy was not that strong and fairly agricultural. Czechoslovakia was the industrial power of Eastern Europe, Romania had oil and both had far stronger economies that weren't regularly teetering on the brink of default, so neither had any reason to look to Poland for the 'leadership' that Warsaw thought it was due. Poland would OTL at least tacitly co-ordinate with Germany, they used the Anschluss as cover to issue an ultimatum to Lithuania and would participate in the carve up of Czechoslovakia during Munich, so it would not take much to tip them over into a bit closer co-operation, particularly economically where they were struggling.

A brief reminder there is no Anti-Comintern Pact in Butterfly. I've discovered Japan was quite incredibly keen on the idea and probably still are, from their perspective hating Communism is a key strand linking themselves, Poland and Germany so is a good basis for a treaty. Even OTL von Ribbentrop wanted Poland included in the Anti-Comintern Pact and it wasn't that crazy as Hitler was, publicly at least, boasting about German-Polish relations being strong. Here Germany is still trying to balance China and Japan and there is no Sino-Japanese War to force them to pick, so the idea remains just an idea. Italy is not included as Mussolini sees trade links with the Soviets as a way out of his current economic hole and the very different Spanish Civil War means relations remain strong, in addition relations with Germany are far cooler than OTL.

The Bulgarian bit is mostly OTL, they did default and refuse to pay, and Boris did want to expand trade with other nations to avoid being dependent on Germany but just as here he failed. It was included partly for the train anecdote but mostly to show German diplomacy is finding it's feet again. Von Neuarth was a full on Nazi and he only disagreed with Hitler and von Ribbentrop on tactics not on the overall objective, so the German Foreign Ministry is still going to be stirring up border complaints and inciting Germany minorities, but less bombastically and possibly more effectively. Certainly things are looking up for German interests, even if certain economic and financial fundamentals remain and are casting ominous shadows over the future.

El Pip · Apr 16, 2025

Chapter CLXV: Spanish Oranges Are Not The Only Fruit.

In the autumn of 1937 the British authorities found themselves grappling with the always sticky issue of marmalade. Delightful as marmalade is their concern was not the substance itself, or even the marmalade factories of Dundee and Oxford, but the raw material they required; oranges. Autumn is not marmalade making season, however if you wish to have industrial quantities of oranges available for the actual marmalade making season it is the time of year to start purchasing them. This was an issue as many believed the best fruit for marmalades were Seville oranges, named after the region in which they were almost solely grown. The late autumn was also the time when British importers of eating oranges began switching from South African and Brazilian suppliers to the in-season fruit from Palestine and Spain, they also increased the volume of imports considerably as the lack of any other cheaply available fruit meant orange sales spiked enormously over the winter months. Thus the seemingly innocuous and minor matter of orange supply could legitimately be restated as a concern about the impact of the citrus trade and the international fruit industry credit financing on the Spanish Civil War. The matter also required the British government to address some very fundamental questions about the war in Spain that it had been diligently ignoring and had hoped to continue ignoring until the war was over. Stated in those terms it should be apparent why the matter attracted such high level attention, particularly given the magnitude of the problem; prior to the outbreak of war fully half of Spain's exports to Britain had been oranges, £5 million being spent on the fruit alone with the shipping, insurance and other costs further increasing the value of the trade. For context, and taking examples that were very relevant to the Spanish and British authorities, £5 million would pay for 2,500 Vickers Cervantes SPGs or 1,300 Spanish Venom fighters at list prices and in practice far more if ordered in anything like those quantities.

Bananas being loaded onto LNER fruit wagons at Canary Wharf, part of the sprawling network of docks on the Isle of Dogs in the Port of London. Canary Wharf had opened in 1937 to support the growing volumes of fruit being imported by the Norwegian owned Fred Olsen Fruit Lines shipping company, the name of the new wharf indicating the source of much of that fruit, the Spanish owned Canary Islands. Rather than using the opportunity of the war to squeeze the Norwegian lines out of the Iberian trade, London had taken the wider view and instead allowed them under the aegis of the Royal Navy provided they co-ordinated their sailings through the Admiralty. This offer was keenly taken up the Norwegians and the other neutral shipping lines, not to gain protection from the Republican raiders but as a defence against from the crippling insurance rates being charged to unescorted operating in a war zone.

It would be unfair to say the British government had hoped to ignore the matter, but only because that implies they were in any real sense aware of it, at least outside a few specialists in the Board of Trade. The government did not have an orange or indeed citrus fruit policy, beyond the usual Empire Free Trade preference for Imperial suppliers where ever possible, and had contentedly left the things to the free market (or as free as any market got in the period). In the case of trade with Spain the Monarchist government had retained the Clearing Office system to intercept any foreign currency earned and collect it in Madrid. However instead of being used to repay outstanding debts, as was the intent of a Clearing, the money was spent on the priorities agreed by the Military Council, the body that was de facto running the country in the name of King Javier. As Britain had accepted that repayment of pre-war debts was suspended due to the war, and carefully avoided the question of what happened post-war, there was nothing for Britain to do and no need for any policy on the subject. The problem with this conclusion was that it assumed the theory translated into reality, which it regularly does not. To begin with the marmalade, the orange groves of Seville were all safely within the Monarchist sector and the transport network remain mostly intact, both sides conviction that they would "soon" win making them reluctant to attack non-military targets. Seville and the rest of the Monarchist south was under the mixed control of General Yagüe's Army of Africa and the German supported Falangist militias under Manuel Hedilla and this was where the diversion from theory began. Hedilla and his German backers had put together a somewhat labyrinthine scheme to bypass the centralised system and divert the hard currency away from Madrid and towards their own purposes. The Falange would take their share of the military budget in Pesetas and use it to buy the oranges, these would then be traded to Germany in a barter deal for the tanks, artillery and various other equipment to arm the expanding militias and re-build the 2nd Armoured Division 'Primo de Rivera'. Germany would then sell the fruit onto British traders and use the earned Sterling for her own imports. While Britain may have lacked an orange policy it absolutely had one about trade and understandably this scheme was not what they had in mind. Given the priority that Berlin had attached to building Anglo-German friendship the scheme came as a surprise to the British, it threatened to undo much of the limited progress that had been made to build relations. That it was even contemplated is a testament to the growing foreign exchange/strategic materials crisis in the German economy. While the sums involved were relatively small in the context of Germany's total import bill they were in hard currency, something which was increasingly being demanded by the oil companies and other suppliers of strategic materials who had no interest in complex barter arrangements. It was also hoped the scheme would serve as a template that could be used to expand the trade with Spain, not least to vital minerals and strategic materials. This was the context of Berlin's instruction that the immediate demands of the economy took priority over longer term plans for a British alliance; diplomatic relations could be fixed later but re-armament could not be delayed.

As mentioned the British government was not impressed with this scheme, it managed to annoy almost everyone except the few Anglo-German Fellowship types who were reduced to unsuccessfully arguing the scheme was small and insignificant and pretending there was no unfavourable precedent being set. A large portion of the opposition was just to the idea of British imports so nakedly funding German re-armament, though this was kept fairly quiet; just because the government and Foreign Office didn't share Berlin's dream of alliance didn't mean they wanted to openly antagonise Germany. The complaints instead focused on the impact on the British consumer (all the extra hops in the trade meant the final price of the fruit would be considerably higher) and the long standing opposition to government level barter deals. Unfortunately while the British establishment was united on the matter, this had very little direct impact in Spain. The Monarchist Military Council had ruled against government level barters in favour of a somewhat open market export of commodities (subject to various taxes and duties) and the proposed trade was mostly within the letter of that ruling, even if it completely violated the spirit. As Hedilla had was taking his claim on the central funds in Madrid in local currency not rarer hard currency none of the other factions felt like they were losing out and did not fancy a bruising internal fight over the seemingly trivial matter of fruit. The British could have applied enough pressure to force the matter at council level, but their main allies were the Carlists who lacked the local influence in southern Spain to actually enforce things if Hedilla just ignored the council. There was of course another faction the British had good links with, the Army of Africa under General Yagüe who were very appreciative of the 2pdr anti-tank guns and other supplies that they had received over the summer. The British liaisons had reported favourably on the professionalism and competence of the Army of Africa, but were concerned about their lax attitude to acceptable collateral damage and the uncertainty over quite what Yagüe wanted for post-war Spain. In an ideal world London would have kept channelling support through the Carlists and kept Yagüe at arms length, but having been forced into working with him earlier in the year the Army of Africa now presented an opportunity. Yagüe and his commanders were happy to work with the British, on the reasonable basis that the money earned from the sales was spent on arms for them and not just put into central funds in Madrid, something the British reluctantly accepted. A more positive side effect of the deal from London's perspective was to deepen the fractures in the Falange between the pro-German group around Hedilla and the self proclaimed Legitimist faction, both groups claimed the legacy of the conveniently dead former leader José Antonio Primo de Rivera but the strong support of the German ambassador had seen Hedilla's faction in the ascendency. The failure of the deal, and the German reluctance to supply equipment without the 'adequate compensation' that Hedilla could no longer provide, would force much of the militia and membership to abandon him and look elsewhere for the support they needed.

Juan March, by some counts the 6th richest man in the world in the late 1930s, certainly the richest man in Spain and a key figure on the Monarchist side of the war. Aside from being one of the main financial backers of the cause, both directly and through his banking connections, March was also one of the unofficial channels between London and Spain. In the Orange Affair he would help link up the British representatives with the Army of Africa leadership, he would later arrange talks between the disgruntled Legitimstas Falangists and the Carlists. While never officially a British agent, March's first loyalty was always to himself, he would work hard to ensure the British aligned factions came out on top in Spain, not for their benefit but to avoid other, less business friendly, groups winning out. It is also highly likely his own Great War experience had left him reluctant to openly being on the opposite side to London again.

Moving to the east of Spain we find the orange groves of Valencia which predictably enough produced Valencia oranges, unlike their brethren from Seville they were sweet and soft, suitable for eating and juicing not being processed into marmalade. As Valencia remained firmly within the Republican sector their export was being routed through the French quasi-guarantee system for Republican agricultural goods, this was unfortunate for Britain as Valencia oranges made up the other half of the Spanish-British citrus trade. On a practical level this was not a concern, discreet discussion between the main fruit importers and the French Agricultural Export Board had indicated they were very willing to sell to British firms; Britain was the largest orange market in the world so it would hard to find anyone else that would want so much fruit and, though the French would vehemently deny it, an injection of several million pounds of Sterling would be very helpful in supporting the recently re-valued Franc and rebuilding the Bank of France's reserves. The importers were quick to complain that this system would also result in higher costs, British consumers paying the price for the guarantees Paris had given to the Spanish, but it was the broader impact that concerned Westminster. In a parallel with the German plan the intent was that Paris kept the hard currency and paid back Spain in the form of weapons, ammunition and the like, thus it would be fairly simple to draw a line from British consumers buying a glass of orange juice to new Hotchkiss H38s tanks heading to the armies of Republican Spain. A similar logic applied to other Spanish agricultural exports and indeed non-agricultural exports that France was involved in facilitating, a hurried investigation discovered that the problem was widespread but fortunately at a far smaller scale.

The efforts to stop the trade soon hit problems, all of which revolved around the British government's decision to keep the status of the conflict ambiguous. Monarchist Spain had been diplomatically recognised to allow trade, transfers and loans but it was far from clear what it had been recognised as; the legal successor to Spain, something temporary or something else entirely. Informal pressure could be applied but this had limits, the relevant example would be if an importer had a contract with a Spanish firm now in the Republican zone then they would need a legal reason to cancel it or risk being sued for the breach. Indeed given the UK's dominant position in the relationship such contracts tended to be governed by English law and so the case would be in a British court, making the matter even more awkward and public. The government would soon discover the problem extended just beyond physical imports as a number of firms had, in the absence of any definite legal requirement, continued to trade with the Republicans or even started new relationships, though almost always through a non-UK based subsidiary or allied firm. Informal inquiries were met with the response that the firm had a contract or other legal commitment and no basis in law to not fulfil it, which was generally true although greed, indifference and even occasionally politics were doubtless motivators as well. As mentioned at the start of the chapter there was a financial dimension to the problem, mostly concentrated around credit financing. The London based Anglo-South American Bank had been the largest foreign owned bank in Spain and the third largest overall prior to the war so was heavily involved on both sides. While the bank had not directly funded anything, perhaps the reason it's operations had escaped official notice until that point, it had provided the backing, contacts and foreign exchange access that the Republican banks and co-operatives that did the financing relied upon. The Bank of England, while admitting it had failed to notice the banks activities, did question exactly what issue they were supposed to have noticed; no UK or Empire funds had been sent to Republican Spain, indeed the flows had been the other way with profits coming back to London, and legally the Anglo-South American directors hadn't broken any laws, regulations or even official guidance. Given that the Anglo-South American was still in severe trouble after some disastrous ventures in Chile earlier in the decade an attempt to keep a profitable and legal business going in order to pay off their creditors was in fact exactly what many thought they should be doing. This part of the affair is sometimes highlighted as a failure of the informal, unofficial method of government and regulation, which while somewhat true misses the point, the problem was not that the informal system was incapable of stopping trade with Republican Spain from happening, the problem was that it had worked too well and allowed the government to fudge and delay some of the difficult question of what to do about Spain. Ultimately it was not the enforcement mechanisms but the lack of a firm government position and policy to enforce that had allowed that state of affairs to develop.

The government reluctantly accepted that what was required was either to accept the status quo or pass legislation to change the legal position and outlaw trade with the Republicans. This was not as straightforward as it may seem, for while the government retained a healthy majority there were concerns on the backbenches that the country was on something of a slippery slope, one which could well end up with Britain being dragged into the actual fighting, indeed arguably the Royal Navy was already involved. Such a move would also be another blow to Anglo-French relations and a smaller one to the trans-Atlantic relationship with the US, both of which had been somewhat recovering (or at least no longer getting worse) after the currency market co-operation earlier in the year. In the end though the cabinet decided to make the changes, British interests were now tied to a Monarchist victory and it was too late for regrets or a change of course. The specific legislation was straightforward enough, essentially being an updated version of the Trading with the Enemy Act from the Great War with Republican Spain officially cast into the role of the 'enemy' who should not be traded with. Pressure from the whips, along with very public commitments from Eden about Britain not joining the conflict, headed off a back bench revolt so it was the opposition benches that had the most issue with the legislation. Labour uniformly voted against the Act due to their sympathies for the Republic though not without grumbling from some of the industrial unions who's members were making a good living fulfilling Monarchist orders but who had not see a penny from the Republic, but with the rest of the party united on the issue it was not seen as worth a fight, a telling indication of where it actually sat on the priority list. The Liberal Social Democrat leadership had the toughest time of it, starting with when they realised they didn't have a policy on Spain and so had to scrabble together a position of being against the legislation as it was an escalation while never actually saying what they would do instead, thrashing out an actual policy would involve some internal fights which the party hoped to keep private. Such politicking aside the Act would make it's way through Parliament relatively rapidly, though the debates would still prove bruising for both sides as the unsavoury allies of their preferred faction were played up for maximum rhetorical effect. For all that outside of the question of fruit prices the Act had minimal domestic impact, for much of the public the war in Spain was something that happened in the newspapers or on the radio and not something that impacted their daily lives or their voting plans. In general though the public favoured the Monarchist side, not out of any particularly deep seated analysis of the conflict but because the Republicans had shot at the Royal Navy and so were 'obviously' the villains of the affair. The government's decision to further support the Monarchists was therefore mildly popular, the mildness being due to a general disinterest in a foreign war than anything specific about the policy.

A contemporary sketch of the secure vaults beneath the Banque de France (BdF). While not quite as full of gold as some in France would prefer the contents had at least stabilised after the dramatic events of the summer. The BdF had idiosyncratically chosen to manage the 1930-31 banking crisis by prioritising support for connected banks, that is those who were shareholders in the BdF, on the basis they were more important and also more likely to be able to repay. This had not quite worked as intended, in large part because the resulting bank failures of unconnected banks had just exacerbated and prolonged the panic, even spreading to the connected institutions and overwhelming the BdF's reserves, requiring a government bailout. While the major banks survived 15% of banks in France failed, unfortunately for Paris this included all the banks that had operated in Spain and the surviving banks remained too weak to even think about international expansion. While many in France were pleased they had not bailed out bankers (BdF excluded) and ensured they had suffered along with the rest, one unfortunate consequence was that the French state lacked any bank like entity that could replace the British institutions pulling out of Republican Spain.

As previously noted the British government did not have an orange policy and would have been happy to continue not to have one, unfortunately they were forced to develop one to deal with the question of where the winter oranges would come from if not Republican Spain. The preferred option was of course an Empire source, however South Africa was just at the end of their season, the West Indies orange unpopular with the public, and the other sources were all too small to make any meaningful difference. The exception was Palestine, which we shall look at in more detail in the next chapter, but suffice to say it too could not fill the gap in the short term. A Sterling Area supply was next on the list, but here again there were issues as an outbreak of the Tristeza virus had all but wiped out production in Latin America and nowhere else in the official area was or could be a major exporter. This left external options, all of which had their own economic or diplomatic problems; Italy, the US and Japan. Aside from the obvious problems of turning to Italy for a supply Italian oranges had been forced off the European market by the lower price and higher quality of Spanish fruit, so there was a reluctance from the importers to return to them even if the other difficulties could be overcome. Japanese mandarins, while eminently suitable for the British winter fruit market, were also a potentially more expensive option due to the considerable shipping distance and the need to use a reefer (refrigerated cargo ship) to ensure they arrived in good condition, the alternative of canned oranges would be cheaper but another market disruption as it was a noticeably different product. Finally there was the US where the navel oranges of Florida were good 'eaters' and just coming into season in considerable volume, all the major fruit lines had well established routes and it was felt that the very low price of US agricultural products would somewhat offset the extra cost of trans-Atlantic reefers. The issue therefore was diplomatic and political, fruit had been one of the areas where the American government had been pushing for British trade concessions and the Board of Trade had long identified that it was an area of opportunity; the US agriculture sector had a political importance completely disproportionate to it's economic heft and the US farm lobby was desperate for more export markets to offset domestic surpluses and so low prices. There was therefore a reluctance to 'throw away' such a good bargaining chip without getting some American tariffs lowered in exchange, something that the Embassy in Washington confirmed was still vanishingly unlikely given the makeup of Congress and the priorities of the President.

While most government departments were happy to ignore the matter as being someone else's problem, the Foreign Office actually engaged and came out in favour of the Italian and Japanese options, in both cases hoping to use trade to increase contact between the parties and improve relations. Notably this was one of the first twitches within Whitehall of a desire to engage with post-war Italy with the hope of re-establishing at least a functional diplomatic relationship with Mussolini. Scarred after appeasement the Foreign Office was careful to emphasise this was not about making any concessions but about the benefits to Britain of having more normal interactions with what was still a European Power and major player in Mediterranean and Balkan diplomacy. As Mussolini's government was considered unlikely to make the first move it would fall to London to do so, the orange matter was considered a good choice as it was low profile and strategically unimportant, but with enough economic weight behind it to be worthwhile. In contrast the Japanese option was supported as a measure of balance, while Britain had heavily committed to Nationalist China the Foreign Office was still trying to keep relations with Tokyo at least cordial and a large trade deal rarely hurt relations, especially with Japan needing to find extra Sterling to support it's quasi-barter deals with Germany. The US option did not attract much favour as Anglo-American relations were not seen as particularly bad, the Canton Island Incident was being diplomatically buried and the Presidential equivocation over 'Moral Neutrality' had convinced most observers the Landon Administration was having second thoughts over engagement with Spain, so would not be that concerned about further British involvement. The Board of Trade and Imperial Trade Council were united in their view that it didn't actually matter as it was probably only a short term issue, once the Monarchists won then the trade would be restored so this was a temporary blip; unspoken was the corollary that if the Republicans won then Britain had far bigger problems to deal with than citrus supply. In the end the Foreign Office viewpoint won out and the cabinet decided they might as well try to get some benefit out of the whole affair. The Board of Trade and Foreign Office began the talks to allocate a nil tariff quota to Japan and Italy, the decision being that both nations would respond better to serious talks than unilateral gestures. In deference to the strong views of some of the cabinet a brief effort was made to talk to the US State Department, however this merely confirmed the Americans had not departed from their unique definition of 'reciprocal' when it came to trade. It also emerged that Britain more formally coming out as opposed to the Republicans, as oppose to supporting the Monarchists, had caused the 'Spanish Credit' market on Wall Street to crash as traders bet against a Republican victory, further imperilling the American firms selling to the Republicans on credit and the banks that had financed them. This further damaged the prospects of any form of trade talks while also causing the government and Foreign Office to revise their view on the actual state of Anglo-American relations.

Once the decision on suppliers had been made the matter vanished from the political agenda and sunk into the depths of Whitehall, even the relevant minister were more than happy to delegate the matter to lower level functionaries. With London keen to get the fruit, both Tokyo and Rome very keen to earn some more hard currency and nothing strategic involved the small scale deals were duly thrashed out, the Board of Trade even managed to carve out some concessions in the form of small reductions in the tariffs those nations were imposing on British Empire imports. In practice however little came of this as those nations imports were in practice centrally directed; all their earnings from the citrus trade were poured into 'strategic imports' such as oil, iron ore and rubber, the positive view would be that all those imports were from either Britain or the Empire and the talks and ongoing contact required did provide another channel for communication and other activities. It is possible that had Cabinet or Parliament been aware of how the trade flows would develop they may have deliberated more and made a different decision, but political attention had moved elsewhere long before this became apparent. How much the officials in the Board of Trade and Imperial Trade Council had known, or even suspected, about the outcome is a different question, the evidence suggests they were somewhat clearer eyed about the realities of trade and the non-financial costs of having a widely used reserve currency. In any event the most politically noticed ramifications of the whole affair would not be the any international response, but events within the Empire.

---
Notes:
As has long been threatened it has now come to pass. The impact of the citrus trade and international fruit industry credit financing on the Spanish Civil War. Who else would dare to combine such words, let alone write a chapter on it? Probably best not to answer that.

Fruit import numbers are right for the early 1930s, I've changed the equivalence based on my best rough estimate of how much the kit being sent to Spain in Butterfly would cost. Military costs are always a bit witchcraft as they depend heavily on what is/isn't included, how far along the manufacturing run is and (for wartime numbers) how bad war inflation was both in general and for that sector. Also worth pointing out the obvious that those costs don't include fuel, ammo, supplies, spares, uniform and all the other things that turn a tank or aircraft into something militarily useful.

The Canary Island fruit runs and the history of Canary Wharf are OTL. In an attempt to keep on track I did not mention the apparently obligatory trivia about that, but here in the notes there is space. The Canary Islands are named from the Latin Canariae Insulae, which translates as Islands of the Dogs, the area of London Canary Wharf sits in is called the Isle of Dogs.

There is a whole load of complex politics about the Falange that I decided not to include because this is not a Spanish AAR so it's out of scope. Very broadly the Falange had some big internal fractures that didn't matter when Franco was running the show and merged everything together, without him those fractures have split open. German support remains lukewarm as they are much more worried about an assertive France (want to keep good kit for themselves) and aren't getting paid (no big barter deals as per OTL). The other relevant point is that the British are having to spread their support which they know is probably not going to end well but feel they have to. Juan March remains an interesting character, certainly he would have had his fingers deep into this sort of scheming.

The Anglo-South American Bank is a fun, to me anyway, little story. It only ended up in Spain in 1916 when the British government decided having a British bank in Spain would be useful for various reasons. They turned this into being the biggest foreign bank in Spain, but then had serious problems in the 1930s and ended up a Bank of England quasi-supervised 'bad bank' which limped along until it's main rival was encouraged to buy it. My feeling is with more money to be made in Spain they are still in a mess but the profits from Spain are helping to keep them healthier, which means they are around to make more of a mess about government (lack of) policy. I also liked the contrast with France, who let their banks in Spain go to the wall or be brought by foreign rivals which was morally cleaner but is coming back to bite them. A sub-theme I'm exploring in Butterfly is "If you want to be a global financial power there are costs you must pay" and this is part of that. I also really liked the BdF vault sketch.

The public opinion is pretty much the opposite of OTL, but given all the changes and the reasons mentioned I think such a swap would have occurred. I am reminded of the OTL Nov 1937 survey where given the choice between fascism or communism a quarter went for each and the other 50% had no opinion. Most people not really caring was probably the default unless something major happened, like one side shooting at the Navy.

Dangling my toes far too close to current affairs I will note that the US attitude to trade at the time were messy but a bi-partisan one, so I doubt it would change much with Landon in the White House. The US was in the position of being a major exporter who's markets were cut off by tariffs and quotas, but due to domestic pressure couldn't/wouldn't offer any real concessions. This made any talks a waste of time, at least until the infamous master negotiator Neville Chamberlain got involved. Fortunately he is nowhere near this, so it remains at a deadlock.

Finally the question no-one was asking, how did this get dealt with in OTL? Well mostly by Britain just buying from whichever side controlled the oranges at that point. But also by buying a lot of canned oranges from Japan, several hundred thousand cases of it a year and that was while Japan was at war in China, money that as mentioned was used to lubricate Japan's barter deals and foreign trade. The fundamental interconnectedness of all things is never to be under-estimated.

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The Butterfly Effect: A British AAR

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