The importance of war and military institutions has been generally neglected in British historical writing, whose tone has been set by the Whig and l… - Correlli Barnett

Two things caused the decadence of British maritime power: the long peaceful supremacy after Trafalgar and the capture of the navy by that hierarchy of birth and class that controlled so many of Britain's national institutions. Drawing most of its officers from 1 per cent of the nation, the Royal Navy never tapped that great reservoir of urban middle-class talent that made Scheer's fleet so well-educated and so intelligent... The navy reflected social rather than functional values, preoccupation with tradition rather than technology... It was a tragedy for Britain that the aristocracy and gentry had never been cut off from the national life, as had largely happened in France... [T]he social and intellectual values of industrial society never ousted those of the aristocracy. The richer Victorian England became, the more ashamed in a deep sense did she become of the technological origin of those riches. The engineer and the businessman have never been as "respectable" in Britain as in Germany or America... [I]n the world after 1870, when Britain faced the technical challenges of the more complex phase of the industrial revolution and the commercial challenge of foreign competition, the leadership of the country was in the hands of the social group least likely (because of its wealth and privilege) to be aware of the challenges and to respond to them. From 1870 to 1914 Britain was decadent because a decadent ruling social group and decadent (non-functional) values had captured or corrupted the forces of technological and social change.

The urgent challenge of winning a total war against so formidable an enemy as Germany, indeed the peril of national defeat, jolted Britain as an industrial society far more effectively than mere peacetime world-market competition, to which she had failed to respond as she should have done according to classical economic ideas. A remarkable technological revolution began in Britain in 1915 and was consummated in 1918 – remarkable not only because of all the deficiencies that had got to be made good, but also because the revolution was accomplished under wartime conditions and at utmost speed. It is also noteworthy that it was masterminded by the government, and that many of the new American-style factories were actually owned and operated by the state.

It remained only for Britain during the war to pour out the rest of the investments and the gold on the purchase of war supplies from the United States, while at the same time cutting visible exports to a third of the 1938 level for the sake of war production, and the basis of Britain's economic existence for the last hundred years had been comprehensively destroyed.
In 1945 Britain was therefore left by this nemesis of free trade with none of the advantages of being highly dependent on foreign trade, and all the vulnerability. In the immediate postwar era, and for the first time since the beginning of the industrial revolution, she would have to depend almost entirely on visible exports in order to secure the life and work of the nation and to rebuild her old prosperity.