The study of Britain's external financial and economic relations in the twentieth century provides a variety of insights into the nature of the relationship between the City and government. This chapter focuses on an aspect of that relationship which remains highly controversial: the part played by the City in the formulation and conduct of British policy towards Germany in the 1930s.

Historians must of course guard against the tendency to regard the City as some kind of homogeneous entity or single interest group. In this respect, even persuasive arguments based on the concept of ‘gentlemanly capitalism’, like those advanced by Peter Cain and Anthony Hopkins, remain open to criticism. Dumett, for example, has warned against any analysis of causation which allows the inference to be drawn that City and Whitehall elites were united by ‘likemindedness’ and a ‘common view of the world’. Instead, the investigation of foreign-policy formulation should seek to identify the conflicts and tensions within the decision-making process. Michie, similarly, has pointed to the difficulties involved in defining ‘the City’: its very diversity suggests that it was incapable of speaking with one voice. Individual parts of the City, on the other hand, were able to develop their own voice: tightly organised banking committees, for example, were well placed to represent the respective interests of their constituent members. As E. H. H. Green argues, this institutional structure allowed bankers, at least, to develop a degree of cohesion far in advance of anything seen elsewhere in the British economy.