Besides tragic human losses from the war, Great Britain’s economic losses were grave. The national debt after the war was ten times that of 1914. Many British investments abroad had been liquidated to purchase food and war materials. Forty percent of the great British merchant fleet had been destroyed by enemy action.
Though on the winning side in World War I, Britain staggered from economic crisis to crisis.
Immigration inward was steadily offset by emigration outward, especially to North America.
Despite efforts to recover, the steam had left the British economy, which grew at half its prewar rate.
Idealists like President Wilson HAD expected that the collapse of the Romanov, Habsburg, and Hohenzollern empires would automatically ensure an increase in the number of democratic states. But, instead, much of Europe came under regimes that were hostile to liberal democracy. In the 1920s and 1930s the core of democracy remained the great North Atlantic powers—Britain, France, and the United States; the smaller states of Scandinavia; the Low Countries; Switzerland; and the inheritors of the British tradition—Canada, Australia, and New Zealand.