Order read for resuming Adjourned Debate on Question [21st June]:
That this House takes note of Command Paper No. 6527 on Employment Policy and welcomes the declaration of His Majesty's Government accepting as one of their primary aims and responsibilities the maintenance of a high and stable level of employment after the war."—[Mr. Ernest Bevin.]
May I ask you, Mr. Speaker, whether you propose to call the Amendment, in the name of myself and two of my hon. Friends—at the end of the Motion to add:
But is of the opinion that full and stable employment cannot be achieved while the major resources of the country are owned by private individuals.
Might I address a short argument to you, Sir, in case you may be able to change your mind about this? I appreciate that the Amendment is put down by only a few Members, but I think it is relevant. My two hon. Friends assure me that the majority of the electors who voted for them, find that the Amendment expresses precisely the major criticism which they want to make on the White Paper. The constituencies which they represent are not very special constituencies, and the experience of electors in other Divisions must be similar and, although there are few hon. Members who want to raise the point, there is a large number of people in the country whose criticism is represented by precisely this Amendment. That criticism, of this policy and of all other policies, it is the object of the Government perpetually to evade and to ignore, to treat as if it was not there.
May I put this further point? It would not be fair on me and other Members of the House, whose names are not on the 6riler Paper, to ask us to vote in these circumstances unless there was a definite Amendment before the House. I do not want to cast a vote in general against a scheme which claims to do something to deal with unemployment, but, if a reasoned Amendment were put to the House, I should be in a position to vote. While I agree with you, Sir, that it would be unfair at an early stage in the Debate to limit it by the calling of an Amendment, I think you might consider whether the granting of a vote on it might not be considered, when the Debate has proceeded to its normal conclusion.
If, Mr. Speaker, your Ruling on this point stands, and is to stand on similar issues in the future, would it be possible for you to use your influence with the Government to induce them to put their Motions in different terms? It is all very well to point out that we have an opportunity of voting against the Motion, but it will then be said that we do not take note of the White Paper, and do not welcome the Government's statement that they intend to take responsibility for full employment. If the Government had put down a Motion declaring that the House approves the proposals in the White Paper, and regards them as adequate for meeting the problem of unemployment, we could simply vote against it, without being put in a false position. But what is happening is that the Government put on the Paper a Motion so worded as to make it appallingly difficult to vote against it——
The hon. Baronet who was responsible for this little incident has quite recently discovered a set of principles in which I have believed for many years. I commend his enthusiasm but not his judgment. We launched yesterday a Debate of very far-reaching importance raising very vital economic issues. The party to which I belong has always taken a very deep interest in the problem of employment for two reasons, first on the purely human ground that unemployment is a tragedy creating uncalled for and unmerited suffering, often amongst very large numbers of people, and, secondly, because in our analysis of our national problems we felt, and still feel, that unemployment is a social cancer arising out of economic dis-organisation. It is perhaps the most searching criticism of the capitalist system that, notwithstanding 150 years of capitalist development, that system has not solved, nor indeed has it tried to solve, the problem of recurring large-scale unemployment.
It is a generation since Keir Hardie came to this House, despised by the vast majority of Members, and hated by a large number. We have a new point of view. One of the earliest Measures which that small Labour group in the first decade of this century introduced was a Right to Work Bill. We had a slogan which I have used over 20 years on many occasions, "Work or Maintenance." That is to say, a responsibility is cast upon the State to ensure, so far as it can, that there is employment for people and that, failing the provision of employment, there is adequate and honourable maintenance What is now called "a high and stable level of employment and social security," is exactly what we said in much simpler terms, much more easily understood by the common man. That shows that we have at least now entered on a new stage of our developing social conscience. Time was when unemployment was regarded as being due to the inherent vices of the poor and to personal and moral defects. It was not regarded as being due to great, sweeping economic influences. Many years ago I quoted a story that I was told of a great lady in a rural village in Southern England, who held a Sunday school for children. It was not held in the drawing room but in the butler's sitting room. This lady had her own catechism. One question was: "What are laws?" The answer that these poor little agricultural labourers' children had to give was: "Laws are wise institutions to maintain the rich in their possessions and to restrain the vicious poor." That is typical of the 19th century social philosophy, and I grieve to say that it is held by many hon. Members even in the 20th century.
A revolution in our attitude towards unemployment came with the Royal Commission on the Poor Law. A new attitude was taken towards the problem of destitution by both the majority and minority of that Commission. About that time Sir William Beveridge was writing his book on unemployment, which was published shortly after the Royal Commission's Report. That volume was entitled, "Unemployment, a Problem of Industry." That, indeed, is true up to a point. It is a problem created by the mal-organisation of industry, but perhaps not capable of solution by industry alone. But that did represent a change, and I welcome the fact that the present Government, composed of the chief elements of our political life, should have come to the conclusion, for the first time declared in any State document, that the State has a definite responsibility for the maintenance of a high and stable level of employment. That is an admission from which no Government can ever recede. So far as we are concerned, any Government that tried to cast off that responsibility would be hounded by us to its very end.
Now the question arises how far we can travel together—all of us now that we have recognised State responsibility—in the solution of this problem. As I say, I share the views of the hon. baronet the Member for Barnstaple (Sir R. Acland). When I first discovered them I felt as religiously enthusiastic about them as he does to-day. We have been living with them so long that, perhaps, we have lost a little of our earlier oratorical enthusiasm. We are leaving the age—indeed we began to leave it long before the war—of what is called private enterprise in the ordinary sense of the term. There may be spheres of activity in which "the little man" may have a rightful place. That is undoubtedly so. I would draw a distinction, shall we say, between a potter who is making ornaments of real value, and the man who is turning out drain pipes. I believe that drain pipes ought to be manufactured on a very large scale, and the same necessarily applies to other things. But what has happened is that the economic unit, industrially, commercially and financially, has tended to grow in size as time has gone on. I would say that in the more important industries, the root industries, the real key industries of the country, the choice now is between private monopoly or public monopoly.
I am not saying that every industry is ripe for either kind of monopoly at the present time. That is not part of my case. My case is that the major control in industry in future, control which will govern even the minor industries, will pass more and more into the hands of monopolies, either public or private. Private monopolies are open, as their past history shows, to very serious criticism. They have not always proved efficient; they have, indeed, in many ways and on many occasions deliberately stood in the way of economic development for their own financial interest; and they have not the necessary authority themselves to handle the causes of unemployment in the same way as would a public monopoly. I believe that in the White Paper there are many proposals of great importance, which must be adopted if we are to organise industry in future.
My right hon. Friend the Minister of Labour and National Service said yesterday, "Here we have got this machinery; we are not begging the question as between private enterprise or public enterprise." I am bound to point out that sooner or later that is the issue which must be faced, if this problem of unemployment is to be dealt with on a proper scale. Therefore, there is much substance in the Amendment on the Order Paper, and I personally subscribe to it. [An HON. MEMBER: "Vote for it."] This is an issue which will not be settled to-day. It will not be fought out before the finish of my political life. It will be a long and stubborn issue, and we might as well face it. Where we part, as we must part on a matter of this kind, with hon. Members apposite is that they do not take the same view of the economic life of the country as we do. We put our emphasis on public ownership, partly on grounds of efficiency, partly also on grounds that it is the best way to assure to the common man the highest possible standard of life, and partly because we believe that in that way, and in that way alone in the last resort, can we finally destroy this ogre of unemployment which has been such a curse to the working-class life of this country.
We would go further than that. I do not believe that this nation alone can solve its own unemployment problem. I do not believe that fiddling about with preferences and tariffs can go very far, or that that is a way to prosperity which will yield lasting results. What we have to do if we are to get a proper standard of life for the people of this and other countries, if we are to maintain a high and stable level of employment, is to develop the undeveloped resources of the world. There we can do a great deal in the Colonial Empire. There are vast untouched resources which could, if they were developed, yield a new standard of life to the peoples of the Colonial Empire and help to maintain a higher standard of life for the people of this country. But that in itself is not sufficient. All the resources in the Colonial Empire are only a fraction of the world's resources still untapped, resources which we know are there, which have never been measured and have not yet been used.
The solution therefore of this problem of unemployment rests upon the orderly development of the available resources of the world for the needs of mankind. That cannot be done by racketeers and bucket shop merchants in Wall Street or the City of London or wherever they may be, and I suggest that just as we shall have in the future, in my view and that of my hon. Friends, to get rid of the competitive element and develop the co-operative element, so we shall have to do that in the wider sphere if we are to make the best use of the world's available economic resources. We would call that international Socialism. It might frighten a lot of people, but it really is worldly common sense. Therefore, while we here accept the recognition by the State of a new responsibility which hitherto has been un-recognised and unaccepted by the State, we do not believe that the machinery in the White Paper will, as it stands now, solve our problems.
A good deal depends upon the purpose of industry. My hon. Friend the Member for Pudsey and Otley (Sir G. Gibson) said yesterday that now we were producing for the war effort, and for the public good, but that after the war we should be producing for private gain. I can understand my hon. Friend making that statement. He is quite sincere and I did not expect that he would take any other point of view; but this is the rock on which the White Paper will split. If the predominant motive in industry is to be private gain we can say good bye to all hopes of ending large-scale unemployment. Therefore, while I personally am glad to see the White Paper and recognise how far it goes and how far it breaks with old traditions, I still must, on behalf of my hon. Friends, re-assert the faith we all hold that the one way is the way we call Socialism.
I must congratulate the Government upon the White Paper which they have produced. I have read it from beginning to end. It is a most readable, well-written, highly interesting document, and we ought to pay a tribute of some kind to those civil servants who have been responsible for it and have made, as they always do, a good job of it. It approaches the problem on a scale never attempted before. Certainly it aims high, in its attempt to solve the age-old riddle of recurring booms and slumps and to put in their place, as far as possible, a state of continuing good employment. To effect this, it proposes a number of measures of a novel character, such as control of private capital, regulation of public expenditure and works, and the variation of the rates of premium for social insurance in relation to the state of trade. All these involve a measure of Government control of industry, to which this country has never before been subject. The British people do not like Government control, and that may be the snag on which this scheme will founder, but it seems to me obvious that booms and slumps cannot be prevented by allowing the completely free play of economic trends, as in the past. We must recognise that, if stability is to be obtained, there must be some control. It is to a large extent a choice between two evils.
I do not intend to develop this theme further, because there are two specific
points to which I wish to devote the rest of what I have to say. First, I want to deal with some aspects of our export trade, and, secondly, to deal shortly with the balanced distribution of industry in the Development Areas. In regard to our export trade, in paragraph 48 of the White Paper one reads these words:
To avoid an unfavourable foreign balance we must export much more than we did before the war.
In facing this problem we have to recognise that many of our old markets are probably permanently lost; some of those, for instance, in the Dominions and India. Take, for example, Australia, of the capacity of which I personally know something. Australia is becoming a manufacturing country. We used to look upon Australia as mainly a primary-producing Dominion. Now, owing to the war, they are manufacturing more and more. They now make motor cars and aeroplanes, and after the war Australia obviously will not be the market for our manufactured goods that she has been in the past. The same observation applies to India, which is becoming more and more industralised, as the Chancellor of the Exchequer very well knows.
To offset losses of this kind we must make the most strenuous endeavours to maintain and increase our exports to other countries. Above all, we must hang on like grim death to the markets which are within our own control, by which I mean British enterprises established abroad. That is a branch of our foreign trade of which I have had some experience. Those enterprises comprise railway companies, oil companies, mining companies and public utilities of all kinds such as telephone companies, tramway companies and lighting and power undertakings. They were established abroad mostly by the enterprise and initiative of our forefathers and they all provide a ready made market for British goods. Railways require rolling stock and equipment; oil companies require drilling and refining machinery; mining companies require plant and machinery and also electrical equipment of all kinds; telephone companies need equipment; tramways require rolling stock, rails, brakes and axles and steel. These British enterprises operating abroad are to-day suffering increasing difficulties. They have to meet rising costs due to legislation in the countries where they operate, social legislation to a large extent, which is giving greater advantages to labour in those countries—all to the good, but, nevertheless, it means rising costs.
In many parts of the world these British enterprises have also to face an increasing nationalist feeling, an increasing feeling on the part of countries which in the past accepted British capital and British enterprise that they are better able to carry out things for themselves than they used to be. Therefore, I hold strongly that the Government should do all in. their power to help these enterprises. The help which the Government can give seems to me to be of two kinds; first, help politically. Our representation abroad is very important. The commercial attaches of our embassies and legations should be of a type who have a thorough knowledge of industry and particularly of the industries carried on by British concerns, which can also be helped by political backing when necessary. In recent years British concerns operating abroad have often felt that they have been left very much out in the cold by the home Government. There was the case, which happened not very long ago and is within the recollection of most hon. Members, of the confiscation, because it was practically confiscation, of the British oil companies—and American—in Mexico. Again, there is the treatment which the Argentine railways are suffering to-day, not at all the sort of treatment which they have a right to expect. I think that stronger action could have been taken by our Foreign Office and the British Government in the past in cases like that, and that it would have had good results, and I hope that in future British enterprises abroad will be able to look to the Foreign Office and to the home Government for the support to which they are entitled.
Another way in which British enterprise abroad can be helped and helped most strongly and definitely—and this especially concerns the Chancellor of the Exchequer—is in the field of taxation. All these concerns abroad are at present suffering double Income Tax. It is true that in arriving at the profits on which they pay Income Tax at home they are allowed to set off the Income Tax which they have paid to the foreign Government of the country in which they operate, but even so that still leaves a double Income Tax and means that these companies are paying more taxation than they would be paying if they were domiciled in this country. There is another way in which high British taxation very much prejudices British concerns abroad, particularly public utility concerns. An immense proportion of the revenue received from foreign nationals in the form, for instance, of railway fares or tram fares or payment for telephone calls goes into the British Exchequer in payment of British Income Tax instead of being available, as it otherwise might be, for reducing rates or improving services. That definitely puts these public utility companies into a very awkward position when operating abroad. I have reason to know that the Chancellor of the Exchequer either has been or shortly will be approached on behalf of industries of this character with regard both to the question of double taxation and the effect of British Income Tax on public utility concerns abroad.
I do hope that the right hon. Gentleman will give very close attention to those representations. I am sure he will, because he, more perhaps than any other Minister in this country, realises the immense importance of maintaining our export trade. In the British-owned enterprises abroad there is a ready market which naturally comes first to Britain. All such concerns wish to give employment to British work-people and to British firms. Although it is certainly true that since this war we have largely lost our foreign investments in the form of securities, nevertheless it seems to me that we still retain an immensely valuable export market in these British-owned industries abroad, established by the initiative and enterprise of those who came before us. Therefore, I most strongly urge the Government to do all they can to help and foster the prosperity of British industries established in foreign countries.
There is one other point I wish to make, regarding what is called "the location of industry," and it has reference to the part of the United Kingdom which I have the honour to represent. I ask the Government not to forget that Ulster should be treated as a Development Area. When the President of the Board of Trade was speaking the other day on the location of industry, he mentioned various Special or Depressed Areas in this country which were going to be treated as Development Areas, such as the North-East coast, Cumberland and the Scottish industrial areas, and so on, but he did not mention Ulster. That part of the United Kingdom has definitely, in the past, suffered unemployment as severely as any of these Special Areas. Ulster depends largely for its prosperity upon two main industries—linen and shipbuilding. I was looking recently at the percentage figures of unemployment among insured persons. They show that in the 17 years from 1923 to 1939, unemployment in Ulster was highest in seven of those years compared with the Special Areas; was second highest in seven more of those years and third highest in three of those years. Comparing it with the Special Areas during the four years, 1935–38, it headed the list in one of those years. I most strongly ask the Government, when they are considering new factories and the other advantages which are to go to the Development Areas, not to forget Ulster.
I feel that this Debate is the precursor of an attempt to inaugurate in this country a scheme for maintaining employment in the years to come of a character which has never before been attempted by any other Government in the world. All one can do is to wish it success, and to hope and believe that the main proposals in the White Paper will be found workable, and that the scheme will help the future prosperity of this country.
I do not intend to follow the speech of the right hon. Member for Antrim (Sir H. O'Neill), but I would like to say that some monts ago I visited Ireland and made a tour of Ulster for the purpose of securing men, if possible, to come to England to work. One of the most amazing things I found in Ulster was the great number of unemployed men who came to the employment exchanges seeking work. All I can hope and wish is that the speech of the right hon. Member for the furtherance of full employment in Northern Ireland will bear fruit.
I congratulate the Minister of Labour most sincerely on his excellent speech yesterday. I felt that it was full of sincerity and augured well for the future of the country. I am one of those who welcome the White Paper very much indeed, and I feel that too much time cannot be spent on this important question. I quite agree with the statement in the Minister of Labour's speech, which I was delighted to hear, that we are turning our backs on the past. To me the White Paper does, in its way, mark an epoch in the economic life of Britain and of the world. It is a real pleasure to me that, at last, a British Government have declared that it is the responsibility of the Government to ensure a high and stable level of employment. The right of the common man to be given work at fair wages and in decent conditions receives priority to a degree, over the claims—I will strengthen this point later—of financial conservatism, and for the first time there is an indication, slight though it may be, that money is to be our servant and no more our master.
When asking myself why and how this change of front has come about, I feel proud to be a member of the Labour Party which has for years agitated for, and demonstrated, the principle enunciated in the sentence to which I have just referred. I am one of those who remember very vividly the speeches of Keir Hardie in this House and throughout the country. I recall with interest and joy his propaganda on the right to work. Looking into the records I find that that was the kernel of his maiden speech, which, I believe, he made in moving an Amendment to the Address in reply to the Queen's Speech. In it he called attention to the widespread misery due to large numbers of the working class being unable to find employment. That, and all subsequent speeches of men like him, played their part in creating public opinion in this country for this particular change of front. His point was that the unemployed were not out for charity. What they demanded were constructive measures to provide work and end the wastage of human life. I am also pleased to read that in 1907 the Labour Party said that the State must accept responsibility for finding decent jobs for all its people. The position of the working man and woman of this country is now an agreed one.
Perhaps the House will pardon me if I give this personal note. I remember when the last war finished—I happened to be in it—signing on at the employment
exchange for a couple of years along with thousands of others. Having had that experience, I rejoiced in the remark made by the Minister of Labour yesterday that before the lads left this country to go to Normandy he was asked a certain question. I want to assure the House that when I heard him make that statement I felt that he was speaking of the bitterness that I myself went through after the 1918 débâcle. That is the paramount question in almost all letters which M.P.s get from their friends and comrades at the front. The question is: "What are we going to do when we return to civil life?" That is still the paramount question. Cutting down, which always takes away the purchasing power of the people, is wrong in principle. That was what happened at the time of the Geddes and May Reports, and the Snowden policy was the height of folly. The policy now proposed reverses that position, and should be welcomed on those grounds. The White Paper says that the Government propose to encourage—
privately-owned enterprises to plan their own capital expenditure in conformity with a general stabilisation policy.
That is all to the good, as far as it goes. The document goes on:
The larger private enterprises may be willing to follow in their own interests, the example set by the Government in the timing of public investment and to adjust their activities accordingly.
"Encourage" and "may" are not impressive words. They do not get down to the real thing. On this point, proposals like the following are much better:
To increase public enterprise, to include particularly fuel and power in all its forms, iron and steel and transport.
I believe that those types of enterprise are better if converted to public ownership. Every extension of public ownership makes easier future planning for the provision of full employment.
I feel that I can best express this point by giving the House this further thought. I have here three Reports in which I am deeply interested. The first is a Report by the British Gas Federation to the Minister of Fuel and Power. I have had to study it. From a factual point of view it is excellent, but I feel that its conclusions are almost 100per cent. in favour of the furtherance of private enterprise. Another Report is that of a committee, upon which
I sat for some twelve months, in relation to the future of industry. It is by the Association of Municipal Corporations, which is composed of representatives of all phases of public political thought in the country. This Report, with the other from the British Gas Federation, has gone to the Minister of Fuel and Power. In paragraph 14, the Association places this statement on record:
In our view, any attempt to reorganise the industry by a process of voluntary evolution, resulting in the perpetuation of gas companies and holding companies interested in the industry, would fail to bring about any substantial improvement in the industry. The extension of the dual system of public and private ownership as a permanent feature of the industry will always be a barrier standing in the way of voluntary rationalisation and co-operation.
The third Report contains the findings of the Labour Party on the same important question, and stands for the full policy of public ownership. Those are three lines of approach upon which the ultimate solution of the problem of employment is to be found.
The Government should set up a board to deal with national investments. The board should direct the money of the country into the best channels for securing employment. Much as I welcome the White Paper, I regret it does not go much further. It should definitely proceed upon the lines of full public ownership. I went through a large industrial establishment in Lancashire this week and was amazed at the speed with which things can be produced. The difficulty before us is not one of production, because our technical and scientific advancements are colossal. The problem is low consumption. It is upon the lines I have suggested that the Government should plan their policy for the problem of employment.
The White Paper proceeds upon the premise that, for some years after the war, there will be no problem of general unemployment. It states that there will, in fact, be a period of shortage of labour. We all hope that the forecast will be fulfilled. It recognises also that there are certain parts of the country, where, even in those earlier years, special difficulties will exist, to which the general proposition will not apply. Those are the areas in which are situated the heavy industries, so essential to the prosperity of the country, such as coal, iron and steel and shipbuilding, and most of the areas which are almost entirely dependent upon the export trade. Proposals are therefore contained in Chapter III of the White Paper, and I would invite the consideration of the House to this aspect of the problem.
Those areas were for many years before the war the Cinderellas of industry, and projects for restoring them have always been regarded as the acid test of any Government policy for dealing with unemployment. I would take as an illustration of the general problem of those areas the shipbuilding trade. During the last war there was a great expansion of naval and merchant shipbuilding, not only in this country but in the United States, Canada and Australia. After the war, great fleets of merchant ships entered into competition with our country, under the United States Shipping Board, the Australian Commonwealth Line and the Canadian Government Merchant Marine. This period was followed by serious dislocation in the industry, and by vast unemployment.
In these areas men were out of work for years—some for five, others for eight and some even for ten years. On the Tyne four out of five men engaged in the shipyards and in the shipbuilding trade were out of work, and two out of every three marine engineers. Thousands of them left the industry altogether. Subsidies for shipping had to be introduced, while many of the yards closed down, some of them permanently and others on a care-and-maintenance basis. Efforts have been made during this war by local authorities on the North-East coast, aided by representatives of organised labour, to get some of those yards brought into service, but the project has been definitely turned down on the ground of shortage of labour. Otherwise they might have been employed in the building of ships so badly needed by our country.
History has a nasty habit of repeating itself. During this war there has been an incredible expansion in the building of ships, both naval and merchant ships. All these will come into service after the war. What is to be the fate of all our shipyard workers and marine engineers after the war? Is it to be the same as it was after the last war? That problem is supposed to be faced in the White Paper, in Chapter III. How do the Government propose to solve that problem, so as to make the
future different from the past? The White Paper says:
The first line of attack on the problem of unemployment in these unbalanced areas must be to promote the prosperity of the basic industries on which they primarily depend. … It will be an aim of Government policy to help these industries to reach the highest possible pitch of efficiency, and secure over-sea markets.
A pious resolution, but every Government since the last war has passed the same resolution, to be followed by the most disappointing results to all those interested in these areas. There is no suggestion here as to what are the measures which will be promoted or which will carry out the aim of the Government to help those industries. I submit that the Government ought, if they have arrived at any decision at all on this matter, to give to the House at all events an outline of the concrete proposals by which they propose to carry out that very laudable object. The Paper says further:
Secondly, "these industries, and the areas which are largely dependent on them, will share in the benefits which will flow from the Government's policy for maintaining domestic expenditure at a high level.
The only way in which domestic expenditure can in any way even remotely affect the shipbuilding trade is that by a greater expenditure on imports more ships will be needed. That does not seem a particularly vital proposal.
Then the Paper goes on:
The Government, therefore, propose to attack the problems of local unemployment in three ways.
And the first way is by influencing the location of new enterprises. That subject was discussed a fortnight ago, and I do not wish to develop it now. I would merely remind the House that it is limited to new industries, and therefore has a very restricted scope at the outset. Then the Paper proceeds to refer to the location of new factories. I would ask the Government, What do they mean by new factories? Does it mean the erection of new buildings which will be equipped by the people who have built them, or does it mean the re-equipment of existing buildings, because there is a vast number of splendid new buildings which have been erected in the course of this war, and no doubt any industrialist who wishes to commence a new business can find a building already in existence in which he could carry it on? If it is to be limited
to new buildings which will be equipped by the industrialist, the location of new industries will effect practically nothing.
Moreover, there is the further consideration that the influencing of the location of industry is to be purely voluntary. There is to be no compulsion on anyone to go into those areas. Without any Government influence or interference, industrialists who felt it to be to their benefit to go into those areas would go in any case. Consequently I hope that the Government are not relying too much on their project for influencing the location of industry. Then the White Paper states that the Government will continue and extend the policy of trading estates. These estates have only been on a very small scale up to the present. They have been of certain advantage in the areas in which they are located but the advantage is very limited. There will be no solving of the problem of employment in those areas by erecting trading estates. I doubt whether a single man engaged in the shipyards has been engaged in employment on the trading estates, so there is no solution to be found there.
The next proposal is:
Due regard will be paid to the needs of these areas in the placing of Government orders of all kinds.
That has been a part of the professed policy of all Governments since the last war, but I venture to say that I shall have the support of every Member of this House who represents areas of this kind in saying that when attempts have been made to influence the placing of Government orders in those areas, orders which could be placed elsewhere, the greatest possible difficulty has been found in getting more than a nominal amount of orders so allocated. I assume that the personnel of the Civil Service will continue to be the same as it has been. What is required is an entirely new mind in that Service in dealing with the placing of Government orders, if these areas are to benefit. The next proposal is that
The Government will also take such action as may be necessary to secure the full development in these areas of the basic services on which industry depends and to stimulate the modernisation of their capital equipment … (including docks and harbours, …).
That is another part of the policy of every Government since the last war. The right
hon. Gentleman the Member for East Edinburgh (Mr. Pethick-Lawrence) said yesterday that many of the positive proposals in this White Paper are most obscure. This is a very good illustration. What does the Government mean by taking "such action as may be necessary"? There is no suggestion whatever as to what they propose to do. If they have thought about it, if they have arrived at some decision as to what action can be taken, because action will be necessary in these areas, the House should be given the benefit of knowing it.
In this White Paper what is the stimulant to stimulate the modernisation of capital equipment? There is no reference as to anything practical that the Government propose to do. There have been any number of schemes discussed for the development of docks and harbours in the North East. No stimulant was ever applied, and there is no prescription here for the stimulant which is contemplated. The next proposal is this.
By removing obstacles to the transfer of workers from one area to another, and from one occupation to another.
Is it part of the policy of the Government that workers should be transferred from one area to another? Apparently it is not, at all events on a large scale, because the White Paper says elsewhere that the Government—
do not rely primarily on large-scale labour transfers for a solution of the unemployment problems of particular areas …
and in paragraph 29 they say that
where a large industrial population is involved, the Government are not prepared … to compel its transfer to another area. …
So that it would appear that what the Government do is to give their benediction to transfers by removing obstacles to transfers, but not themselves effect any transfers, so not much will be obtained out of this.
The transfer of labour has been carried on as part of Government policy before the war, denuding these areas of some of the finest workmen they have had, men who had been trained in order to develop the particular industries on which these areas are dependent. What we want is a real stimulant in order to keep these men in the area where the industries are situated and help forward those industries which employ them.
I am coming to it in a moment. What we want is a stimulant to benefit shipbuilding, marine engineering, coal, iron and steel in times when the industrialists engaged in them are not prepared themselves to risk their own capital in putting forward various projects. The final proposal is:
By providing training facilities to fit workers from declining industries for jobs in expanding industries.
Do the Government regard the shipbuilding industry as one of these declining industries? If so, it is a sorry position for our great maritime country. If not, that provision does not apply to the shipbuilding trade at all.
That is the Government policy. In my submission it is inadequate to solve the problem which will necessarily arise in these areas after the war, when the building of naval vessels dies away, as it will do after the war, when we have this great conglomeration of merchant tonnage already in existence—except for the new liners which will be required. I suggest that unless it is proposed to do far more than is contained in this White Paper, we shall have a repetition of a good deal of the misery and distress we had after the last war. I would ask the Government, Do they propose to give subsidies to shipping again as part of this policy? I would ask them if they have considered whether it is not practicable for them, as a Government, to frame proposals which will ensure that ships are built in British yards in times of depression when owners will not build them themselves. Ship repairing is a field giving great employment. Could not the Government frame some policy which will ensure that ships are repaired in British yards, instead of being sent to Continental yards, where costs are lower?
It is merely a question of inducement in all these cases. The Government can do it without difficulty, if they are prepared to frame their policy accordingly. I exhort the Government not to be afraid of adopting methods which are unorthodox, and I can assure them that any reasonable policy which they may put forward which will help to maintain these great basic industries, which are so essential to the security and wellbeing of the nation and to the splendid body of workers who are engaged in them, will at all times receive the full support of all sections of this House.
I am glad to be able to follow the hon. and learned Member for East Newcastle (Sir R. Aske). He and I have been Members of this House for practically the same period, and I have never known an unemployment Debate take place in which he did not strenuously stand on the side of the unemployed men, and against the pettifogging proposals which he and I have had to meet periodically during the whole of those 20-odd years. I do not know where to begin to deal with this document, because if it had finished after the first sentence in the foreword, which says:
The Government accept as one of their primary aims and responsibilities the maintenance of a high and stable level of employment after the war,
it would have said all that it has said of practical value. It could well have been published as a pamphlet, bearing the title, "Some musings and meanderings on the economic problems of our time, by a Cambridge undergraduate," or "an Edinburgh undergraduate"—I do not want to be offensive to Edinburgh, which is a great university, but that would not have been an unfair description. I am a little upset at my right hon. Friend—no, he is not my right hon. Friend now: the right hon. Gentleman the Member for Wakefield (Mr. Greenwood) and the right hon. Gentleman the Member for East Edinburgh (Mr. Pethick-Lawrence), who have been the two official Front Bench spokesmen for the party above
the Gangway, applauding the fact that to-day, in 1944, we are seeing some of the ideas that Keir Hardie propounded on the first day he was in the House, being acknowledged in general terms by the Government of the day, to which their party has contributed a very large proportion of the responsible personnel. For the last 20 years, I have taken a primary responsibility for carrying on the party which Hardie led during the whole of his political life, the Independent Labour Party. He was the creator of that party. I have taken a primary responsibility for 20 years for keeping it close to the ideals of its founder.
Not necessarily pure, but refraining from running all over the fold like a lost sheep. I find very little ground for congratulation in the fact that, 50 years after the pioneering started, there is an acceptance, in general principle, of the idea. Progress at that rate will not do for the future. We are living in different times; we are living in speedier times; and we cannot spend 5o years before we reach the point of agreeing that this problem is a problem. We certainly cannot have another 50 years before we find the solutions. The mood and the tempo of this document are that a very long time is going to be spent in trying, very tentatively, to find solutions for the problem of unemployment, and the social evils that flow from it. I read in my paper this morning, "Government declares war on unemployment." There are wars and wars. The one in which we are at present engaged went through a period when it was described as a "phoney" war. It was never, as a military war, so "phoney" as this White Paper indicates that the war on unemployment is going to be.
I am glad to see that the right hon. Gentleman the Minister of Labour has come in, because he has played a large part in the building-up of the Labour movement, both on the political and on the industrial side, and, also, he has played a big part in the Government of the day. I would like him to tell me for which of the ingredients of this hodgepodge he was responsible. He will perhaps not remember this, but, about 1927 or 1928, two amiable gentlemen, who either were or had been Members of this House, Sir Alfred Mond and Sir Ben Turner, thought that it was terrible that the two sides in industry should always be fighting each other, and that if they could only get together, and work harmoniously, everything would be all right. The right hon. Gentleman remembers the Mond-Turner scheme. This is Mond-Turnerism in 1944. There is not a single concrete thing in it for the working class, and no real serious recognition of the problem as it is now. They put in the forefront the necessity to capture the export markets. One thing in this White Paper with which I agree is the suggestion that we should get better statistics in future, because this House of Commons has been starved for real, genuine, honest statistics about the whole business, about wealth and poverty, about employment and unemployment, about the movement of industry and things of that description. I hope that this promise of better information will be kept.
I remember Mr. Baldwin, as he then was, declaring some years ago that our export trade called for 20 per cent. of the total of our industrial production. I do not know how that figure stands now—I mean, how it stood in 1938 or 1939, before the war started. There is a figure here, giving the number of workers employed in the export side of the national industry as 1,750,000, and that would indicate that it is not very far away from that 20 per cent. It is all wrong to approach our economic problems on the basis of what is going to be needed for that 20 per cent., instead of approaching it from the point of view of the other 80 per cent. You have 45,000,000 people at your own door, a very large proportion of them unsatisfied consumers, who are consuming 8o per cent. of all your production, and you do not need to decide the whole level of your industrial processes and standards of living on the basis of the 20 per cent. of problematical customers across the seas.
I wonder. I did not mean to speak at any length, particularly on this aspect of the matter, but it is a subject of interesting rumination to me. I could write a pamphlet meandering along on this topic, which would compare very well with the White Paper, but it would be just meanderings, because I could not reach conclusions. But, as I saw this problem of export trade before the war, we were bribing, financing customers across the sea to take our goods. Is not that true? We were trying to sell ships, machinery, or textiles in some parts of the world. Customers were found, and they said, "Yes, we should like to have a big railway development, or motor transport development or electricity development, running into millions; but we have not got the money." It may have been in the Argentine, or in Uruguay, or somewhere else. We would say, "Do not bother about the money; give us the order, and we will lend you the money." That was the ordinary process of foreign trade. Indeed, it found a place in our Governmental procedure. Our export credits and trade facilities schemes were definite devices to provide our customers with the money to buy our goods. They were importers. The hon. Gentleman puts it up to me that we must send out in order to bring in. I say, "You import the goods, and let the other fellow find out just exactly how he is going to get the money for them." I do not know whether the hon. Gentleman has heard the story about Cohen, the Jew, who could not sleep at night. He was tossing and turning in his bed. His wife said, "What is wrong with you?" He said, "I am terribly upset. I owe Isaacs £100, and I do not know where to find it, and I cannot pay him." She said, "What, Isaacs across the road?" He said, "Yes." She got up, pushed up the window, and called across the road, "Isaacs, Cohen owes you £100, and he cannot pay it." Then she shut the window, and said to Cohen, "Now go to sleep, and let Isaacs do the worrying."
It seems to me that the problem is like that. After the war, as before the war, the other nations will want to export. They are all on this same game of wanting to export, and there will be no difficulty about us getting all the imports we want. In approaching the problem from that state of mind, you do not get into the difficulties that are indicated here. The Chancellor of the Exchequer referred to the export markets, I think in his Budget Speech, and, a couple of days
later, I cut this out of the "Glasgow Herald":
The importance of restoring Britain's export trade after the war was emphasised yesterday by Mr. So-and-So—
He is a prominent Glasgow citizen, but I do not want to hold him up to public attention by reading his utterances in this place. He is quite a responsible citizen.
—at a meeting of the directors at the Chamber of Commerce. Mr. So-and-So, reviewing the principal features of the Budget, referred to the statement by the Chancellor of the Exchequer on the rise in wages compared with the pre-war figure, with a tendency to go still higher. That fact, he said, was causing the Chancellor great concern, and the reason for that concern was made clear when he came to deal with the question of export trade.
Now, if I remember rightly, the Chancellor, in his speech, did not connect up this problem of rising wages with the export trade.
It would be all-important that in the postwar period we should not only recover, but vastly increase, our export markets. In view of the increase in costs in this country one viewed that prospect with alarm equally with the Chancellor. It was easy in these days to talk about full employment, but it would be essential to get back to reasonable cost if we were to carry on our export trade. He hoped some of our economists would keep in mind what the Chancellor stated and come to realise that full employment after the war—and particularly if we did not get down to it—was more or less a dream.
Unless we were prepared to cut wages and prices, causing us to get into competitive strife, as we did in the old days, when we were striving to cut our workers down nearer to the starvation level than the workers of other countries, then full employment was only a dream.
Oh, too many. Colonel So-and-So said he entirely agreed that if we were to live as a country, we must be able to compete in the world's markets. Mr. So-and-So carried the Chancellor's statement on the Budget a little further than the Chancellor, and the Colonel carried it still further. It does not matter what the hon. Member opposite says, that is the conception of the ordinary private-enterprise person in this country, and, indeed, of the party to which he belongs—that, if we are going to compete in the world's markets, then we must have a low Wage policy here and a low standard of living for the mass of our people.
I say, Do not start at the export end at all; indeed, do not start at the end of trying to find employment for our people. Start on the assumption, the general Sodialist assumption, and it is the only assumption that can be defended ethically and philosophically, that everybody in the world has a duty to take a share in the work of the world, and that applies to Chinamen, Indians, Germans, Russians, Italians and everybody else. Everybody taking a share in the necessary work of the world, everybody has a right to a full share of the wealth that his labour produces, and it is to see, now, that the persons concerned get their full share of the wealth that is produced that is the major problem, rather than the problem of seeing that everybody takes a full share in the work of the world.
The hon. and learned Member for East Newcastle talked about shipyards. I have put this point before, and I repeat it now. The world's shipbuilding capacity to-day—this is my own assertion, and this is a subject which I have studied and followed, and on which I have watched statistics for a great number of years—is sufficient to build, in one year, a mercantile marine of as great a tonnage as the whole mercantile marine of the whole world of pre-war days. One year can produce the 65,000,000 tons of shipping. Assume that you start from scratch at the end of the war, and that the whole of the world's shipping has to be replaced, which will be far from being a true statement of the case; there is only one year's work in shipbuilding for the shipbuilding capacity of the world. What do the shipbuilders of the world do, when, in one year, they put on the seas sufficient ships to keep the world going for 25 years, at a moderate estimate? Suppose we have all the ships we need for 25 years produced in one year. What do the shipbuilders, the steel workers behind them, the miners behind them, the local shopkeepers in the localities and the food and clothing pro- ducers, do for the other 24 years while waiting for the ships to go down? It is a sufficiently startling example.
Here is a little cutting, all to pieces, which I have shown a hundred times to my friends, whom I asked what they thought of it and what they thought about the significance of it:
Speaking in Vancouver, Sir Robert Fairey, director-general of the British Aircraft Commission"—
presumably, again, a responsible citizen, and presumably with knowledge of aircraft matters. Saying that Britain had set up records for plane production, he added:
Britain could turn out enough planes in three days to last all the world's commercial air lines for five years.
Where is our aircraft industry on that basis? Even supposing that we are so successful in making our productions cheap and efficient, and our commodities superior to all others in the world, and supposing we capture the whole of the markets available, the whole of that market is only enough to give the aircraft producers, and the other producers who stand behind them, three days' work in five years. This tremendously increased capacity for producing goods can be paralleled in every branch of industry where machine power plays a primary part.
I would rejoice in it. It would be to me a matter for great congratulation, because I believe in leisure and that the problem that we have to confront to-day is the fair and equitable distribution of leisure, but we are very far from looking at it in that way, certainly in this House. I want to say one or two words about some of the financial aspects.
May I ask my hon. Friend a question? I am very interested in his speech, but I am rather puzzled by the statement which he quoted about aeroplane production, because, only the other day, it was stated in the Press that the total output for the whole country is between 26,000 and 27,000 aeroplanes a year. This is roughly 500 a week, and, if you take three days as half a week, that means 250 planes, and I cannot believe that that will keep all air lines of the world going for five years.
The hon. Member will have to argue that out with Sir Robert Fairey. I am not awfully concerned about Sir Robert Fairey's figures about aeroplanes, or my own figures about ships. The figures quoted by the hon. Member just now are sufficiently good for my purpose to show——
Not at all. The hon. Member knows that he usually interrupts me when I am speaking, and that there is nothing I like better. I want to indicate to the House the point which capitalism has reached in its apologia. I am sorry I had to speak before the Chancellor. The Chancellor had a good Scotch Presbyterian upbringing, like myself, and, although I have not much left of it, I am beginning to wonder if there is not more left in me than in the Chancellor. I was brought up, in that atmosphere, to have a terrible terror of debt.
No, not quite. It is a childish inhibition. Apart from the one I am owing the right hon. Gentleman, I can think of no other debt outstanding. But we were taught to believe that it was terrible to get into debt, and that you should starve rather than obtain things that you could not pay for. Now this paper tells us that debt—the National Debt, civic debt—is the greatest thing that ever was.
It is not due to me. That is just the point I wanted to make. The hon. Gentleman says that it is due to ourselves. I would not mind that if it were absolutely and literally true, but it is not literally true. It is £20,000,000,000 of debt due mainly to some of ourselves. If it were that we—the 45,000,000 of population—owed ourselves £20,000,000,000 and paid ourselves interest on it, or that we were all shifting our shillings from this pocket—the producer's pocket, where we put our pay—to that pocket, if it were merely a question of transferring the money from this pocket to that, I do not see that there would be much in it.
It seems to be a silly thing to pay yourselves 10s. in interest. But I am talking too long and I am committed to the understanding, but I wish that capitalism would start to explain this to me. I do not like it, but I am tolerant, I hope, and I should like it to be explained to me how £20,000,000,000 of National Debt, and hundreds of millions or more debt hanging round our local authorities, which was always the bane of Chancellors of the Exchequer in pre-war days, has now become a great and beneficent thing. That means to say that a very large proportion of the producers of this country are going to have, as a first charge upon their production, the payment of huge sums of unearned interest to a small section of the community. In spite of all the National War Savings campaigns, "Salute the Soldier" and Spitfire Week and one thing and another, a very large proportion of that £20,000,000,000 of debt is owned by a relatively small group of individuals. The hon. Gentleman opposite shakes his head——
The hon. Member must not take it only in small terms but must remember the aggregations which belong to the people, the great mass of insurance premiums and that sort of thing, and the great charity ownerships throughout the whole of the land. He has put the case, from one point of view, quite fairly, but he must not leave these considerations out of account.
I am not leaving them out of account at all. I am insured with the Prudential Insurance Company. I am paying twopence a week for £20 with which to bury me when I die. The hon. Gentleman is trying to tell me that it is my twopence a week that is really going into the National Debt. That is true, but the economic power is the Prudential Insurance Company.
Again I appeal to the apologists and defenders of capitalism to try and explain the position to me, because it is so tremendously involved now that it is just a mess. My twopence, the hon. Member tells me, in the Prudential Insurance Company, is not controlled by the Prudential Insurance Company but by the India Rubber Tyre Company in the West of Scotland which they finance. I shall tell my constituents in Bridgeton that they are not to worry about property, because, with their twopence a week, they are maintaining motor car factories throughout the country. But I am still not satisfied that the £20,000,000,000 of National Debt, even allowing for the big blocks held by the big corporations, is equitably distributed throughout the whole body politic.
I shall tell them that the majority of the workers will be producing wealth to pay the interest to non-producers, and they themselves, when their trivial compulsory savings and their few pounds in War Savings Certificates have gone, will have no share in the interest payments. Capitalism has now got to such a stage in its development, so completely messed up and involved, that it cannot keep itself going. It still talks in terms of private enterprise, but what a terrible misnomer. The other week I was paying a debt to my tobacconist, somewhat overdue, and rather terrifying and shameful in its magnitude—I mean shameful in the sense that I was spending so much on a mere personal luxury or vice. It happened to be just the day when the Chancellor of the Exchequer made the statement that, out of every 2s. 4d. paid for 20 cigarettes, he took 1s. 7d. I have my cigarettes sent to me by a decent tobacconist in Glasgow, a great defender of private enterprise, a capital chap and a really nice fellow. I said to myself, "Here is old so-and-so collecting a pound off me—private enterprise—and he has to hand 15s. of that to the Chancellor of the Exchequer and keep 5s. for himself." But you may say, "But he does not do that. The cigarettes he hands to me, he gets from the Imperial Tobacco Co., and they are going to take a very big whack out of that 5s. Then there is the landlord who owns the property in which the shop is situated, and he is going to take another whack; and there is the Glasgow Corpora- tion, who impose the rates on him, and they are going to take a whack. And there is this great champion of private enterprise working for the Chancellor, the Imperial Tobacco Co., the landlord, and the Glasgow Corporation,—and he talks about the independence of the common man.
I am the only fellow who gets anything of value out of it. For the right hon. Gentleman to align himself with the task of trying to maintain a system that is so ludicrous as that is really wasting the time of the whole working-class movement. And remember, the right hon. Gentleman is not their Ernest Bevin. He is like the Prudential. He is there, the representative of millions of people, he is their organised power on that Bench, and to come out with this White Paper seems to me to be a poor result. I want to finish by saying that I do not believe any better result could be achieved with that alignment, and, if we are to get something better than that, this business has to stop. The urgency of the case seems to justify it to the party above the Gangway. Let them get out. Let us resume the honest political relationship; let us get to the country at the earliest possible time. Let the Gentlemen above the Gangway defend their unemployment, their private profit, private enterprise and capitalism to the electors; let those who hold the Socialist view put that Socialist view to the electors, as honestly as it can be put; and then let the electors decide, and whatever Government happen to be returned, let them go ahead on the basis of their own principles and try to make good on them; but do not think that the great solvable problems of the time are going in any way to be terminated by bastard practices of this description.
Apart from the striking contrast which the great oratorical gifts of the hon. Member for Bridgeton (Mr. Maxton) present to my own limited capacities, I have difficulty in answering his arguments, and for the very same reason I have difficulty in answering the argument of the right hon. Gentleman the Member for Wakefield (Mr. Greenwood) who opened the proceedings to-day. It is, that both of them advocate a policy which has never been put into operation. Happy is the policy which has no history. The hon. Member will forgive me for not making comparisons with the policy that I have supported for many years.
No, I think that it is a fair contribution from a Coalition Government. I wish to devote my speech, which will be a little shorter than some of the speeches that have preceded it, to discussing the White Paper, which is a very effective vindication of the attitude of the Government towards post-war planning. The more unreasonable of the critics, in Parliament, in the Press and on the platform, have mistaken the care and forethought which these problems require for dilatoriness, and even for a reluctance to introduce any change into our political, commercial and social systems. According to these light-hearted enthusiasts, unless we plan with all speed, however hasty and ill considered our schemes may be, however lacking we are in essential data, however ignorant we may be of our ultimate resources, we cannot be sincere. The Government have had mare than their fair share of this particular kind of disparagement, based, as it now turns out, on quite unwarrantable assumptions. It is now manifest that the scope and complexity of the problems dealt with in the White Paper are so vast and intricate and so many public needs will simultaneously claim priority of treatment, that a great deal more patience than has been evinced hitherto will have to be exercised when these problems raise their hydra-heads on the conclusion of hostilities. Therefore, it seems to me that to carry out our plans in the proper sequence will be one of the essential requirements for success in an orderly reconstruction of our social and industrial life. Until the White Paper was issued, I had some misgiving that the Government were paying somewhat premature attention to certain plans which depend exclusively for their smooth operation upon a wise ordering of our commerce, trade and industry while neglecting to bestow any consideration upon conditions necessary for their success.
I was one of the Members who declined to be stampeded into giving my consent to any immediate legislation on the lines of the Beveridge Report until we had made sure that the three assumptions upon which this comprehensive insurance scheme depended had been proved correct. In this attitude I took my cue from Sir William Beveridge himself; but of late Sir William seems to have gone back on the stipulation he made in the first instance, and he warns us that he will not tolerate any further alteration or modification of his scheme which should be at once put into operation without dispute. Not for 300 years has there been so peremptory a threat issued to this House of Commons. On that occasion it was not very successful, but the individual who made the attempt at least had this to say for himself, that he was part and parcel of the three Estates of the Realm. Surely by now the Government must have realised how infelicitous was the procedure it adopted towards the Beveridge Committee. Royal Commissions, Departmental Committees and other statutory bodies of that nature, on which I and many other hon. Members have constantly served, are set up to collate information, to hear evidence, and then to make very humble representations to Parliament. In any case I have no intention of being influenced in my vote in this House by threats, from whatever quarter they may originate.
The correct sequence of our planning is surely, first and foremost, a plan for the recovery of our export trade, the recapture of our lost overseas markets, and the discovery of new fields for our commercial expansion. Although the White Paper makes it perfectly clear that this trinity of endeavour should be of paramount consideration, up to date the Government do not seem to have acted upon these professions. We are busy laying plans for education, housing, health, insurance, pay, allowances, and so forth, but we seem to have neglected plans for our trade and commerce and industry to which all other considerations must be subordinate. When we bear in mind that we shall have to increase our export trade by at least 50 per cent. to maintain our present standard of living, and that the extent to which we can borrow depends upon our credit, and our credit depends upon our ability to balance exports with imports, it seems curious that we should be urged to place upon the Statute Book a scheme of social security which will prove entirely illusory unless precautions are taken to achieve those conditions upon which security must depend.
On the previous occasion when we discussed the Beveridge insurance scheme, an hon. Member volunteered the statement that we could not afford not to afford it. Whoever originated that clumsy and rather unintelligible phrase could not have known very much about how our social services are financed. They are financed exclusively by the taxpayer and by the ratepayer. The question, therefore, that we should ask is, 1s there a limit to the burden that we can place upon the back of the taxpayer? Surely the right answer to that is that the limit of the burden we can impose upon the taxpayer is the prosperity of our trade, industry and commerce. That is the measure of our capacity to incur expenditure, and therefore I maintain that before we embark upon any novel plan of social reform the Government should, as a necessary preliminary, boldly confront this problem of our external trade. I do not mean that we should wait until we retrieve our position in the world's markets before we pass into law any further measures of social reform. That would indeed involve an excess of caution, but we should certainly possess our souls in patience until the Government have created conditions favourable to that achievement. I hope, therefore, that the Government will abide by the decision expressed in the White Paper in these words:
Any comprehensive insurance scheme will not be put into operation until the abnormal conditions of the immediate post-war years have disappeared.
Can the Government now report any progress on the most urgent plan of all? There are certain pious professions in the White Paper. We find this phrase in the opening paragraph:
In this country we are obliged to consider external demand.
That means, of course, that we depend for our very existence upon our capacity to pay for certain raw materials essential to our needs. I understand that there are committees sitting in Washington at the present moment endeavouring to elucidate this particular problem. Can the Government reveal any results of their deliberations? In 1942 the Board of Trade appointed a representative committee of industrialists to prepare the future development of British export. What conclusion has this committee arrived at? Our assets abroad, as everyone knows, have been reduced to such exiguous proportions that the balance will depend more than ever upon visible exports which will have to be doubled to maintain the equilibrium. Limiting imports artificially will lower our standard of living and will impoverish our overseas customers. Tariffs, as one hon. Member remarked earlier in the Debate, should have no place in a system which is founded upon mutual co-operation between nations. The standard of living of our potential customers must be raised. We must aim at a greater technical efficiency and quality of our goods.
There is another passage in the White Paper to which I would like to draw attention:
Freedom from want cannot be achieved without effective collaboration among nations.
This seems to suggest that the Government are beginning to awake from the trance which the wiles of Sir William Beveridge have produced. But the next passage I quote seems to confirm the good news:
The first line of attack on the problem of unemployment in these unbalanced areas must be to promote the prosperity of the basic industries on which they primarily depend. It will be the aim of Government policy to help these industries to reach the highest possible pitch of efficiency and secure overseas markets.
I represent one of the larger industrial towns of Lancashire, which depends for its welfare and prosperity upon the cotton industry. So far a defeatist attitude seems to have been adopted towards that industry, but there is an imperative obligation upon Government to reinstate it in its former position of pre-eminence in the markets of the world. Between 1912 and
1938, I believe I am right in saying, the cotton industry lost 75 per cent, of its export trade. To-day the industry has been subjected to a process which is known as concentration. A number of the mills have been closed down, their goodwill probably jeopardised, many mill hands have been scattered over the face of the world and they are not very likely to return to their normal vocations.
How can we recapture the trade we have lost to competing nations or obtain our fair share of any expansion of the general world demand? How can we compete, with our rising costs, against countries where the cost of production is lower? These are the matters which interest the people of Bolton far more than some scheme to make everyone secure by blue magic. If we had been as insistent upon the Government's prompt investigation of these vital problems as we were insistent in asking them to implement the Beveridge Report, something perhaps might have been evolved by now. Where I join issue with so many of our planners is in my protest against increasing the burdens of industry without first planning the prosperity of industry upon which the ability to pay depends. No one supports the education scheme more than I do, but I confess that I see little profit in it if you make no plans to find our well educated boys and girls scope for their skill and learning and you will not be able to do so until you find solutions to the problems which our trade and our commerce and our industry present.
However, I am gratified that in the White Paper the Government have issued some warnings to the public on the question of expenditure. For some while we have proceeded on a rake's progress. Surely, it is high time that the Chancellor of the Exchequer should explain to the taxpayer, before we proceed any further with our planning, that there are two alternatives before him: Either that he should consent to have all the remuneration for his diligence, thrift and toil forfeited in consideration of the State taking charge of his body and his soul from the cradle to the grave, or, in the alternative, that he should be captain not only of his own soul but of a proportion of his own resources on condition that he should forgo some of the rare and refreshing fruits which we are promised in such abundance from the hot-houses of Whitehall.
This I believe will be one of the main issues of the next General Election, but I have some misgivings that the issue will be confused because there still exists in many minds the illusion that the Exchequer can alleviate the burden of the taxpayer and the ratepayer by contributing a generous share from its own bounteous store. This act of munificence is called by different names, all equally deceptive—"Exchequer contributions," "Exchequer grants," "public funds," "subsidies." They all come from the same source, the taxpayer. Has it ever occurred to hon. Members that even when the State borrows, it is not the Exchequer which pays the interest but the creditor, the taxpayer? In spite of the millions we have spent on education, there are many who record their votes at the polls who still believe that the Chancellor of the Exchequer has at his disposal a hoard of wealth similar to that which Pericles accumulated in the Parthenon to pay for the Athenian fleet. We have to go back to the Norman and Angevin kings before we find such a system as that.
I am exhorting the Government to implement the promises contained in the White Paper and, until they do so, I am not prepared to give it a full-throated measure of congratulation. The voter in the near future will undoubtedly be called upon to exercise his judgment on very vital and fundamental issues. It is high time, therefore, that we in Parliament should refrain from hoodwinking the public any more in speaking of "Exchequer contributions"—an expression which I think should fall into disuse altogether. And the Chancellor should be more frank and less plausible in instructing the country exactly how we stand financially.
A good beginning has admittedly been made in this direction in the concluding paragraphs of the White Paper. I do not wish to close on a note of criticism. I derived considerable satisfaction and relief from my perusal of the Government's plans. Here was the first effort of responsible persons in authority—not before it was required—to face up to unwelcome and unpalatable facts, unequivocally to place them before a public whose interests are not helped by ignoring them. The White Paper should go far, also, to exercise a wholesome restraint upon those self-styled economists who have misled the public long enough. Personally, I see no reason why, with the exercise of patience and prudence—virtues which seem to be singularly lacking in our amateur planners—and provided we observe a proper sequence in the preliminary stages of reconstruction, this nation, over a term of peaceful and progressive years, should not be able to carry into effect all those reforms which have been foreshadowed in the Government programme and more.
I have frequently disagreed with my right hon. Friend the Minister of Labour on matters arising out of the organisation of the war effort, but I am glad to be able to extend cordial congratulations to him now, on the speech he made to the House yesterday. Defects, undeniable and obvious defects, are contained in the White Paper, to which Members have turned their attention as I shall, but I feel that we were very glad to detect in my right hon. Friend's speech a note of idealism, of passionate concern for the men now fighting on all the battlefronts for this nation and the Empire and, indeed, for the civilised world. But passionate intensity, even idealism, however fervently expressed, cannot alone lead to a solution of our economic problems. We must face facts, whether they are palatable or not. But there need be no fear on that score, because there is agreement in this House on the fundamental issue, namely, that we cannot afford to allow this country and its people to return to the muddled and sordid economic and social conditions that preceded this war. Opinions as to the solution of our problems vary but——
I hope my hon. and gallant Friend was not referring to me. I repeat that, on the fundamental issue which concerns us all, there is general agreement. That is to say, we are con-
cerned with the objective. As to the method of approach, there is considerable variation. Here is a White Paper which embodies a conception of expansion. That is the main idea and, of course, we on these benches offer it an immediate welcome. We have long paraded it in this House and the country, and we detect, in the presentation of this conception of expansion, a complete repudiation of past Conservative policy. That must be said, however unpleasant. The Treasury, before the war, held strongly orthodox views on the subject of financial expansion. The present Prime Minister was, himself, Chancellor of the Exchequer and on a memorable occasion said that
it is orthodox Treasury dogma steadfastly held, that whatever may be the political and social advantages, little additional employment and no permanent additional employment can, in fact, and as a general rule, be created by State borrowing and State expenditure.
That doctrine has been abandoned. It was the doctrine held in 1931 that led to the downfall of the Labour Government and, incidentally, led to my defeat at a subsequent election. In the circumstances of the conception, embodied in this White Paper, of the new doctrine that is being expounded and accepted, the Conservative Party, at least, owe me an apology and adequate compensation. Reference has been made to the late Lord Snowden. He had a part to play in that escapade, in a Coalition Government. We must beware of Coalition Governments, particularly when they are reaching their zenith like a fire-bomb, which reaches the peak of its activity and suddenly descends and explodes.
That may be, and we must protect ourselves against such an eventuality. I repeat, that the Tory doctrine of reconstruction and scarcity, and opposition to State borrowing to deal with unemployment or employment, has been completely abandoned. Let it go; it is of the past; let that spectre never be revived again. The question we have to consider is, How is this expansionist policy to be applied? It involves no mere manipulation of finance. That is only an incident in the process; it involves a comprehensive reorganisation of the industrial structure. It involves the development of agriculture on orderly lines. It calls for the introduction of capital equipment into old industries, and preparation for new industries.
It calls for a great deal more. Hon. Members in all quarters of the House are familiar with the various aspects of the industrial problem. Yesterday, my right hon. Friend the Minister of Labour referred to "full employment." Indeed, the phrase was repeated several times, but I cannot detect in the White Paper any reference to full employment, except in paragraph 54, where the workers are admonished not to continue their objectionable, or alleged objectionable, trade practices. Why it was inserted in that particular paragraph I cannot understand. There is nothing in the White Paper about full employment, nor is full employment, as an objective, intended. All that is asked for is a "high and stable level of employment," and I ask the Chancellor of the Exchequer if he will define for hon. Members what is meant by "a high and stable level of employment".
My hon. Friend is intelligent enough to know that that is a generalisation which will lead us nowhere, because in the past we have had the highest possible level of employment, according to some experts. But whether we have or not it is beside the point. We are entitled to ask what is meant by a high and stable level of employment. Is it 5 per cent., 8 per cent. or 12 per cent. unemployment? There is reference in the Appendix to 8 per cent. unemployment, rising to 12 per cent. I ask the question advisedly because the Government, in the White Paper, accept full responsibility for employment, and for those who find employment. What about their responsibility for those who fail to find employment? If the Government accept responsibility for those for whom they find employment then, by the same reckoning, they must accept responsibility for those for whom they fail to find employment. If Mr. A. is found a job under a Government commitment at£5 a week, while Mr. B, again under a Government commitment, fails to find a job, what is he to receive? The dole. Precisely what the Minister of Labour and the Prime Minister assured some of the men who were about to proceed to Normandy would not happen when the war was over.
I say to the Chancellor of the Exchequer that if the Government accept responsibility for employment, which means wages and, presumably, a decent standard of living, they must, equally, accept responsibility for that unfortunate section of the community, whether large or small is beside the point, for whom they cannot find employment, not on the basis of the dole, but on the basis of reasonable and satisfactory maintenance approximating as nearly as is practicable to the standard wages that are paid in a great industry. If I am told by hon. Members opposite that they refuse to accept responsibility for the unemployed under this Government commitment, and that they must accept insurance benefit, I ask, What purpose, what justice, is behind it? It may be urged that we cannot afford to pay some people for doing nothing. That does not come too well from some people who have always had money for doing nothing, or nearly nothing. That may be regarded as propaganda and I will not emphasise it, though it may be necessary to repeat it at the next Election. I ask my right hon. Friend to say that, if a man is prepared under Government schemes to accept employment, provided that employment is offered on a reasonable trade union basis, if he is ready to fit himself into national service in any capacity, he must be treated as reasonably as is his more fortunate brother who under Government commitments has secured employment. I detect that particular weakness in the White Paper.
The hon. and gallant Gentleman the Member for Bolton (Sir E. Cadogan) emphasised our alleged reliance on exports. I am sure the hon. Member for Pudsey and Ottley (Sir G. Gibson) would agree, and the hon. and gallant Gentleman would agree, that increased exports are demanded. There never was a greater fallacy uttered in this or any other Assembly. You might imagine from what hon. Members say, and the White Paper says, that, if you fail to increase exports, this country's standard of living will diminish, that, if we fail to export not only at the pre-war level but at least 50 per cent. more than the pre-war level, we cannot provide sufficient work for the workers of the country. Exports have nothing to do with the provision of work. We do not export in order to find work for people. We export for one reason only, and that is to pay for imports. [An HON. MEMBER: "How can you pay for them if you do not export?"] The hon. Member may be in too much of a hurry. I am as familiar with the subject as he is. Suppose we did not require imports; would there be any need for exports? Of course not. Why should we send our wealth out of the country? It is because, to some extent, we depend on imported foodstuffs, and a certain quantity of imported raw material, that we must export in order to meet the bill. There is no other reason. We do not export deliberately and, so to speak, with malice aforethought in order to provide work for people.
I want to put a question to hon. Members opposite who emphasise the need for the expansion of exports. I agree that, as long as there are imports, you must export. There is no question about that. But suppose we do not succeed, when the war is over, and after we pass through the transitional period, and come to the days of chaos and crisis and hard times, according to the White Paper, in exporting as much as is intended. Suppose we fail to export 50 per cent. more than we exported before the war, having regard to current prices and the rest of it; do we wring our hands in despair? Do we throw up the sponge? [Interruption.] If hon. Members do not regard it seriously, they will have to do so some day, because this is the most serious consideration that faces the country according to them. Do we wring our hands in despair, because we fail to expand our exports, or do we say to the workers, as was said before the war by prominent industrialists, "Accept lower wages because we must compete with other countries?" If you reduce wages it is not going to help an expansionist policy. You do not help an expansionist policy by taking money out of the pockets of those who are engaged in the export trade. If we do not succeed in expanding our exports, we are thrown back on our own resources. What do we do then? Consider the position of agriculture. I hope we do expand our exports. I shall offer suggestions as to how to expand them—perhaps ideas somewhat different from those advanced by the Government.
Suppose we expand our agriculture. Suppose we can produce more than we produced before, or suppose we make up our minds, as regards certain categories of foodstuffs, that we can make ourselves in- dependent, is it always to be asumed that this country can only produce at high cost and cannot produce efficiently at a low cost as cheaply as agriculturists can produce abroad? Is there anything so efficient in Holland, Jersey or Denmark that we cannot compete with it? I shall never accept that. If we find that we cannot expand our exports of manufactured goods, it may be necessary to reduce our imports. In that event, we must develop our agriculture on sound and rational lines. What is to happen to the coal industry in those circumstances? Someone said we imported raw materials. Petrol is one of the raw materials. Does anyone suggest that we could not, if we cared, produce synthetic petrol and to some extent make ourselves independent of imported supplies? The argument can be extended in many directions.
The point I am putting is that it is the duty of the nation to utilise its resources to the full. We must eliminate waste in peace-time, as we have tried to eliminate it in war-time. I want it done scientifically. There is no use in producing if we have to produce so uneconomically as to put ourselves at a disadvantage, but that has to be determined. Let us consider that scientifically. Our duty, if we intend to promote a real expansionist policy, is to begin by developing and utilising our national resources. That is the first step. It may well be that, in addition to expanding our national resources, we can continue to export. Of course we can. Is there any reason at all why we should not go on buying foodstuffs abroad and yet produce more at home, because there is a great demand among working class consumers of foodstuffs which remains unsatisfied and will remain unsatisfied for many years after the war? When hon. Members can come to me and say that every family has sufficient foodstuffs of the right kind, then will be the time to ease off. Until that happens, we can import foodstuffs and, at the same time, get on with our agriculture. The same applies to other aspects of our industrial life.
I will tell the House what is the best method of expanding exports. A few weeks ago we had a Debate on an International Monetary Agreement. We were advised by the Chancellor of the Exchequer and many others to accept the implications of a monetary agreement. I opposed it and I still oppose it. Apparently I was right. I opposed it because I main-
tain that the implications of that International Monetary Agreement prevent us from adopting our own internal expansionist policy. Reactions in the United States have supported my contention. Even pro-British journals, very friendly to us, have asked why, having accepted the basis of the International Monetary Agreement, we are now seeking to promote a policy of cheap money and expansion. Is it not about time that we stopped allowing ourselves to be led by the nose, by American financial experts, or even by Lord Keynes? Lord Keynes is, at present, leading a delegation in the United States. What effect that will have on the White Paper I cannot say. We cannot play fast and loose with this question. You can promote an international policy simultaneously with an internal policy, but not in those circumstances. Some years ago the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George), in his war memoirs, expressed himself about Mr. Keynes, as he then was. The right hon. Gentleman said he was a much too mercurial counsellor for a great emergency; that he dashed at conclusions with acrobatic ease, and that it made things no better, that he rushed into opposite conclusions with the same agility. The right hon. Gentleman went on to say:
He is an entertaining economist whose bright but shallow dissertations on finance and political economy, when not taken seriously, always provide a source of innocent merriment to his readers.
I am not going to accept Lord Keynes as my mentor in matters of this kind because I rely on an internal expansionist policy, and I am satisfied that that policy can be developed, but not along the lines of the International Monetary Agreement.
Let us come down to the policy that ought to be developed. But before touching on that, I want to deal with two aspects of the White Paper. One is the subject of insurance contributions and their variation. Even that defect in the White Paper was apparent to the Minister of Labour yesterday, because he saw that it meant very little in the way of expenditure. That is true, but suppose it meant even £50,000,000 annually. The idea is to vary the insurance contributions at a time when depression has begun, but that is the wrong time. Has it never occurred to the Government that when depression begins certain unscrupulous employers, and, indeed, other employers who cannot help themselves, seek to reduce wages? That always happens at a time of depression or incipient depression, and the benefits derived from a variation of insurance contributions will be more than offset by the reduction in wages. The other point is this. It is proposed to adopt an investment policy. Of course there must be an investment policy, but I say that with this proviso. It must not be assumed that finance is the determining factor in industry and industrial development. It is nothing of the sort. It is certainly not a determining factor in promoting employment or dealing with unemployment. In 1921 there were 1,200,000 miners employed. In 1939 there were 800,000. Does anybody suggest that any manipuation of finance would help a situation of that sort? The Lancashire cotton industry underwent a remarkable transformation in 15 to 20 years. Does anybody suggest that that problem could be solved by some financial manoeuvre? Something much more potent and substantial is needed.
This country can afford for at least 20 years a programme of expansion. It requires a great national spring cleaning. I am not now discussing national or private ownership. I am discussing the objective—the best use of our resources, providing employment and satisfying the consumers. That is our objective. The coal industry needs reorganising, and out of the coal industry must be produced new industries. There are at least a dozen new industries that could be derived from the coal industry. What are we going to do in South Wales and Durham? Inject a few small industries and say we are dealing with unemployment? That is not the way to deal with it. Even the idea of location of industry along the lines suggested by the Government is only playing with the problem. We must take some of our old industries like coal, iron and steel, shipbuilding, textile, and a few others, and revive them, transform them, and create new industries from them, as is being done in the United States and as was done in Germany before the war. That is where we are backward. What about the railways? Do not they require electrification, at any rate, as far as the branch lines are concerned? What about the transport position generally? I am not raising doctrin- aire issues. I am talking about our objective—a healthy transport system, efficient for the user and worthy of the State. There is 20 years' work to be done there.
Then let us have a 20 years' housing programme—[An HON. MEMBER: "Fifty years.] I am modest as compared with some Members. Do not let us deal with it in a higgledy-piggledy fashion, piecemeal year by year. Let us deal with it on the basis of a programme that is planned out, with no improvisation. What about ports and docks? Is there no work to be done there? I could take hon. Members to scores of ports that require transformation. What about coast erosion? Is there not a great deal of work to be done there? What about bridges, drainage, Colonial development? What about the development of India? Not that we should impose our industrial will on India, but that we should encourage its development and raise the standard of life of the people there, to their advantage and ours. It is no good dealing with Colonial development on the basis of an expenditure of £5,000,000. It will want many millions, and it may be necessary for the people of this country to sacrifice and to invest in the Colonies, the Dominions and India. Hon. Members speak about exports as if the United. States was a great and capacious market for us. It is nothing of the sort. Does anybody challenge that?
My hon. Friend is much too jejune. I know what is in the White Paper, and if he wants to know, it is simply a philosophical dissertation on expansion. There is nothing realistic about it. This is only an academic Debate. Let us not forget that. It is not as if the Government had brought forward a series of Bills into which we could get our teeth. The White Paper refers to the Government's conception and to what they propose. Which Government are we talking about? Is it the present Government? It cannot be the present Government, because this policy is designed not for the transitional but for the long-term period, for several years hence. Do my hon. Friends opposite think that they are going to be in that Government so remote, or do they intend another Coalition Government? Is this their election manifesto? Is this what they are going to put before the people? If they are going to put this muddled idea before the people without any legislation, and if it is merely going to be a promise, the assurance which the Minister of Labour gave to the men going to Normandy will turn to ashes in their mouths.
I return to the point—continuous development is required and it can be achieved. I come to the final point—On what basis is it to be achieved? I have already said that we need not indulge in any doctrinaire, academic discussions about whether there should be private or public ownership. I envisage the system of the future in this way. There will be, whether hon. Members like it or not, a large measure of State ownership. We cannot carry on the coal industry for many years longer on the present basis. I believe the railways will be nationalised some day, but not in a bureaucratic fashion administered by civil servants, but owned by the State and administered by the people who understand how to run them—the people who are running them now. We shall have in future, too, hybrid forms of organisation, partly private enterprise and partly State ownership, such, for example, as we already have in the Anglo-Iranian Oil Company. That is not a very good illustration, but it is an example of the hybrid form of organisation administering a great industry. I even envisage a large measure of individual and private enterprise in developing new industries; but whether it is State ownership, partially State and partially private, or private ownership only, I ask for a general over-riding supervision by the State so far as national policy is concerned.
I put it to hon. Members that what we must concern ourselves with is the objective. Do hon. Members want full employment? I doubt whether they do. Full employment carries severe implications for them. Full employment and capitalism cannot go together; there must be a margin. Full employment and Socialism can go together. Hon. Members opposite are not prepared for Socialism, and I warn them that if this policy and all that is unsaid in this document—and there is a great deal more unsaid than said—should fail there is nothing for the country but Socialism. If my hon. Friends opposite can solve the problem of unemployment by private ownership or capitalist measures, let them do it and then there will be no need for Socialism. We do not want to impose it on the country if they can solve it, but so far they have failed to solve it. If they cannot solve it they must get out of the way and allow other ideas to be advanced. That is a fair proposition.
I welcome the expansionist conception in the White Paper, but I see a weakness in the fact that there is no provision for its application and that it apparently relies on a future Government of whom we know nothing—and I am not prepared to rely on the present Government. It is a Coalition Government, a compromise Government. There are some good and efficient men in it, but there are some men in it who are not efficient and ought not to be there. I would not trust them to carry out a policy of this kind. They have been opposed to it all their lives, and I do not believe in their sincerity now. We want a different kind of Government. I am not even concerned about a party Goverment if we can have a Government that will accept the objective and are prepared to work for it with all their might and soul. If we cannot have that Government there is only one alternative, and that is a party Government, a Government that believes in this policy and will seek to carry it out.
I wish that it were possible for me to deal more' fully with a number of the main points raised by my hon. Friend the Member for Seaham (Mr. Shinwell) than I can possibly deal with on this occasion because, as I am sure he will recognise, other speeches have been made also raising important points and I have a wide field to cover. There are, however, one or two things I would like to say with reference to his speech. In the first place my hon. Friend declared that the policy outlined in the White Paper represents a repudiation of past policies. He said it was a repudiation of past Conservative policies. I have nothing to do with that, but I say quite frankly that this plan does, in fact, represent, as is stated clearly on the face of the paper, a fundamental change of outlook. I think, if we look into the matter, we shall find that those whose outlook has changed, who have not been above profiting by experience, are not confined to the Members of any particular political party.
My hon. Friend not only made a number of statements, but he asked a number of questions. He was curious to know what we meant by "a high level of employment." He pointed out that the paper does not make use, save in one instance, of the expression "full employment." Let me call my hon. Friend's attention to a passage in the foreword of the White Paper which is very relevant to remarks he made when seeking to define the responsibility of the Government in this matter. I refer to the last paragraph of the foreword, which runs:
For employment cannot be created by Acts of Parliament or by Government action alone. Government policy will be directed to bringing about conditions favourable to the maintenance of a high level of employment; and some legislation will be required to confer powers which are needed for that purpose.
And here is the important point:
But the success of the policy outlined in this Paper will ultimately depend on the understanding and support of the community as a whole—and especially on the efforts of employers and workers in industry; for without a rising standard of industrial efficiency we cannot achieve a high level of employment combined with a rising standard of living.
That is the essence of it. It is a plan which the Government submit for the judgment of this House. It is a policy which can be carried out stage by stage, detail by detail, only if the community, as a whole, accepts the fundamentals underlying the policy and is willing to collaborate with the Government in carrying it out. That is the first thing I have to say on that point. My hon. Friend asked what we meant when we spoke of a "high level." There are figures in the Report and there were figures, if I may venture to refer to them, in the Beveridge Report. It will be found also that when the Government's proposals for dealing with social insurance are submitted there will be figures there——
They are the figures in the appendix to this Report, but let me finish what I want to say on that point. We are dealing here not only with the core of unemployment, but with statistical unemployment. We are dealing with un employment made up of people out of work for the time being, changing their jobs for a longer or shorter period, and with people out of work as a preliminary to passing out of the field of employment altogether. We mean to reduce to a minimum the period of unemployment for people willing to work, but who are excluded from work because of conditions obtaining for the time being. I cannot say anything more definite than that on the matter.
That is Scottish logic. I would like to pass to what my hon. Friend had to say about exports, because I think there are one or two observations to be made at this stage. My hon. Friend said, truly enough, that we are not particularly interested in exports for their own sake, but because they are the means, now that we have lost the greater part of our foreign investments, by which we can get imports. [An HON. MEMBER: "The other way round."] I say quite definitely that unless we can maintain a high level of imports of commodities which we are not well placed to produce ourselves we shall not maintain our standard of living.
My hon. Friend referred to agriculture. Of course we want to develop our agriculture. We have got to, because of our exchange conditions. But if my hon. Friend will examine the figures he will see how absurd it is to use words suggesting the possibility of displacing the vast volume of our agricultural imports by production at home. He spoke also about the development of our industrial processes, about improving our industrial efficiency. Of course we can do a great deal. I have taken some part in this business myself. I know pretty well what we can do in the matter of producing oil from coal, but I tell the hon. Member that if he would like to set about organising our industry with a view to producing from coal all the products we now import in the form of petrol, fuel oil and kerosene he will be setting a terrible task to the people of this country, a task which would bring them to something very near to slavery. The consumers have to be considered, because they are identical with the workers. Where I do agree with him is that we should do everything possible to develop to a high level industrial production of the products of combustion of coal, not fuel oil and kerosene and the bulk products, but the more highly developed products. That is only one illustration. If I had the time I could multiply it many times over.
I will say one last word to my hon. Friend about imports and the place they take in our economy. I would just remind him of what Adam Smith said. He took a simple and homely expression to demonstrate the fallacy of supposing that by taking thought and making effort you could produce at home, to equal advantage, what you had been producing abroad. He took the case of grapes in Scotland. He said "You can grow magnificent grapes in Scotland, but if you want to enjoy a glass of wine do not rely on the Scottish production of grapes." [An HON. MEMBER: "Sour grapes."]
I would like to say one other thing before I pass from this topic, which I cannot fully develop now. My hon. Friend compared the position of this country with the position of Belgium, Holland, Denmark, and so on. We have a history behind us. We have developed an economy; we have built up a population largely on imports. If we have suddenly to switch over to what we can produce ourselves, we shall find the process very hard, very difficult and very painful. I say to my hon. Friends in all quarters of the House, Do not let us be deluded in this matter. We want imports, to maintain our standard of living and our level of industrial efficiency, and we need exports in order to pay for them. It would be deplorable if, on an issue of that sort, which is as plain as a pikestaff, as a result of the sort of argument which my hon. Friend advanced—[Interruption] —I want to get the thing clearly stated. I will have a word to say later on the proposed international monetary agreement to which he referred. I will take that in its place.
What we have here does not pretend to be a cut-and-dried scheme. It does not pretend to be a scheme at all in the strict sense of the term. It represents a policy. The right hon. Member for East Edin- burgh (Mr. Pethick-Lawrence) referred to the scheme as being in some respects vague. I think he used the word "nebulous." I do not quarrel with any word which he applies, because it is inevitable that there should be a certain element of vagueness in what is, after all, a preliminary study, covering a very wide area, of what my right hon. Friend truly described as uncharted sea. If we are to take the House of Commons into our confidence and to look to the House of Commons to give us help and co-operation in building up a plan of this kind, we do not want to try to come down at the outset with cut-and-dried plans. This Paper is, in fact, at one and the same time, an announcement of a fundamental change of outlook towards these matters, and the submission to the judgment of Parliament of the pattern of a general policy, to which plans, still to be fashioned in detail, will conform, if Parliament approves. [An HON. MEMBER: "What is the change of outlook?"] It is set out quite clearly in the foreword to the White Paper. It is an acceptance on the part of the Government of responsibility for a positive policy in this matter.
Do we understand that if the House of Commons approves this part of the White Paper, it will be regarded by the Government as authority to make plans based upon the second part of that Paper? In regard to the whole White Paper, do we understand that we are now authorising the Government to take steps to prepare a plan in fulfilment of the whole of the White Paper?
I am sure that my hon. Friend knows far better than that. I said that if the Government find that Parliament and the country accept the approach to these problems, which is set out in some degree of detail in the White Paper, then they will be in a position to go forward with detailed plans in this respect and in that respect, subject to the approval of Parliament.
Is my right hon. Friend saying that if we accept the general outline of policy advanced here, the Government will produce measures, legislation, before the end of the war?
I am not saying anything necessarily about legislation. I did say that the position is set out in the Fore- word. The Government will no doubt have legislative proposals to put forward. They will also have administrative proposals. One of my hon. Friends below the Gangway complained that there was not sufficient detail in the White Paper showing what the Government would do to help industry, or those industries, as I understood him, which are engaged in the export trades. That is a matter which will have to be taken up. There will have to be discussions and proposals, and maybe legislation as well. There has been legislation put before Parliament in the last 10 or 15 years for dealing with such matters.
On a point of Order. I would ask your guidance, Mr. Speaker. The right hon. Gentleman has said that the Government will take the attitude of the House and the country towards this White Paper as authorising the Government to take certain legislative and administrative steps. We cannot, in my submission, prevent the Government preparing legislation, but we are entitled to ask how far Motions which merely ask us to welcome declarations by the Government as to one single principle contained in a White Paper, which in fact, is not before the House——
That is not a point of Order. That is a debating point which, if the hon. Member catches my eye later, he might make. I cannot be expected to interpret the meaning of such declarations.
Here is a document be fore the House. The right hon. Gentleman has said that he has submitted it for discussion, in order to gather the mind of the House, and if the House assents to the policy embodied in the Paper that will set the plan for future Government policy. I want to ask, in all fairness, what line of action the Government are going to take to test whether the House of Commons accepts every detail of the document.
I can answer that question very briefly indeed. The Government will form their own judgment, and the House will not be held committed to any form of legislative or administrative policy; brat the Government will be encouraged to come forward in regard to the matters sketched out here, in accordance with the degree of support accorded to their general policy. I think that is perfectly clear. In the White Paper the Government frankly recognise their responsibility, not merely, as in the past, for mitigating the consequences of unemployment, but for ensuring the co-operation of all sections of the community in the maintenance of the employment of the people continuously, on a high level.
I do not want to weary the House by taking up too much time. Perhaps hon. Members might wait for a little while and hear what I have to say. This conception has been described as a revolutionary change of outlook, which consorts well, as I should like to point out, with other developments. For example, it has come to be recognized that, in the framing of Budgets, account must be taken not merely of the financial position and the prospects of the Central Government, but of the general economic condition of the country. That is the purpose of the White Papers which for some years past have been presented with the Budget. It follows that taxation must no longer be viewed merely from the standpoint of its effectiveness in raising the necessary revenue. I shall return to this topic later. But I should like to make it quite clear on this point that nothing in this Paper is to be taken as implying any departure from our traditional standards of sound Budgetary finance.
The review given by my right hon. Friend the Minister of Labour yesterday covered practically the whole field of the White Paper. While there is, I believe, practically no aspect of the matters touched on in the White Paper with which the Treasury is not in some way or other concerned, and in some cases very closely concerned, I will not seek to weary the House with mere repetition, but will proceed at once to deal with certain matters on which I believe the House would naturally expect me to comment, while leaving still, I believe, sufficient field for the Minister of Production, who is to take part in the Debate to-morrow.
My right hon. Friend the Member for East Edinburgh, following, I think, the point that had been taken up by the hon. Member for Peckham (Mr. Silkin), expressed the view, and put it as the view of the Labour Party, that he and his party were not convinced that unemployment could be cured under private enterprise. Other hon. Gentlemen said very much the same thing in different terms. As my right hon. Friend the Minister of Labour pointed out yesterday, the White Paper does not seek to take sides in the controversy between private enterprise and public ownership or public management. It seeks to cater for both. In my opinion, for what it is worth, sensible people must recognise, as previous speakers on the opposite side of the House have recognised, for example my right hon. Friend the Member for Wakefield (Mr. Greenwood), the existence of a very wide field in which free enterprise will undoubtedly continue to operate. Surely it is therefore commonsense to provide conditions under which free enterprise can operate and have a healthy development for the general benefit of the community; and on the other hand we must reckon with the growing opinion against allowing certain services, certain activities, which are vital to the life of the community, to be carried on for private gain.
We took all that into account, but the point that troubled me as I listened to my right hon. Friend was this: He seemed to be drawing a distinction between the freedom which the Government would have in giving directions designed to promote fuller employment when industrial activity was under public management as compared with activity which was in private hands. That point does trouble me. I do not want to be in the least controversial, but when I have given, as I have, study to the technical problem of management under conditions of public ownership, I have always pictured this sort of set-up: that managers would be appointed to act on behalf of the community under the general directions of the Government; they would have a duty that would be laid down in some document or direction, to conduct their enterprise with regard to certain principles. If it were transport, for example, it would be to provide an efficient service for the public at a reasonable cost. There would be an element of trusteeship in the duties and obligations of the manager of such a publicly owned enterprise. I venture to doubt whether the Government would really have quite as much freedom, as unkind people would say, "to play about," with the affairs of such enterprises under conditions of public ownership as might be supposed. I have sometimes, in regard to the public service, thought there were people who took the view that the public service was a sort of philanthropic institution, which should be run with a view to providing opportunities of employment for people who were in need. All experience shows that unless the public service is conducted with a view to efficiency, and other considerations are discarded, you very quickly get into very serious trouble.
I should imagine—I do not dogmatise at all—that in the field of industry, especially if it were in any way competitive industry, these considerations would have at least as much weight as in regard to the general Civil Service. What I feel is that we have to develop a technique which, in regard to industry, whether privately owned or publicly owned, will enable influence to be exercised and directions to be given, within limits, which will conduce to the maintenance of a high level of employment. That is by the way, but the point is one which seemed to me of considerable importance and I thought it ought to be emphasised. I do not think I need at this point say very much more about the part that exports may be expected to play in our economy.
Will the right hon. Gentleman give us an assurance that it is not the intention of the Government, after the war, to build up a great export surplus?
I dealt with that point when my hon. Friend made it in an earlier Debate. Certainly an export surplus would not in itself be an objective, but in that particular matter I can assure the hon. Member that we are exposed to no risk whatever at the present time. My right hon. Friend the Member for Wakefield said very truly that this country alone cannot solve the problem of unemployment, because we have to deal with other countries. That is the argument, or one of the arguments, for having arrangements with other countries which will have the effect of clearing the channels of international trade, and the removing of unnecessary obstacles in the way of trade, and saving us from the consequences of competitive depreciation of exchanges when the economic conditions do not justify it. These are all matters that deserve very careful and close consideration. At the same time we must beware of entering into arrangements, either monetary or commercial, which will so tie us to world conditions that we should be dragged down in a deflationary spiral if depression should develop elsewhere, or which would prevent us from controlling our imports if the balance of our payments could not otherwise be brought about. This is a thing we have to bear carefully in mind, in considering what arrangements we ought to make.
Before, in the course of negotiations. The hon. Member knows that the Government are not committed to any detail in these matters. What we really need, in my belief, is an international code of rules which will limit the use of devices calculated to impede trade but will still leave the nations free to take the necessary action to preserve their own internal economic activity and balance of payments. That, I can assure my hon. Friend, is what we have in view in the negotiations now proceeding. To pass to another topic, the right hon. Gentleman the Member for East Edin burgh asked whether the Government contemplated the possibility of a continuance of bulk purchase as a means of getting over the difficulty of price levels. The answer in brief is, "Yes." He further asked, in regard to the use of public works as a means of stemming unemployment, how the Government's proposals differed in any way from what had been done in the past, for example in the period of the depression from 1929 to 1931, when public works on a very large scale were undertaken by local authorities and others, with Government support. The answer is that hitherto when public works have been resorted to as a means of dealing with unemployment action has been taken after the onset of the emergency. They have been undertaken in a hurry with inadequate administrative machinery, and in many cases the effect of the action taken was too long delayed to be of any use. What we contemplate—and I will expand this later—is a close and continuous study of these matters, so that an advancing tide of depression can be foreseen. We contemplate that programmes of public works will be prepared.
There is, as my hon. Friend truly said; great scope for development, in a great many directions, in this country. He cited many instances. We have to get these schemes ready, to have them all worked out with the authorities concerned—the local authorities, the drainage authorities, and the authorities responsible for coast erosion, or whatever it may be—and then to adjust the schemes, and get them into operation as the situation develops. That is a way in which the situation would be materially different from anything of which we have had previous experience.
You will tap the barometer quite often?
Sir J. Anderson: I hope so. I come now to an entirely different problem, which was raised by my right hon. Friend the Member for East Edinburgh, by my hon. Friend the Member for Walsall (Sir G. Schuster) and by my hon. Friend the Member for East Birkenhead (Mr. G. White)—the question of the unbalanced Budget. My right hon. Friend the Member for East Edinburgh spoke of the section of the White Paper from paragraph 74 to paragraph 79. He pointed out that those paragraphs had been criticised in an article in the "Economist": that they had been described as obscure and self-contradictory; and my right hon. Friend thought that he saw the explanation, perhaps, in a mixed parentage. In fact, these paragraphs owe their origin entirely to the Treasury, but I think that in some respects they are difficult because they deal with a highly technical subject-matter and because the authors of these paragraphs move in those particular regions with a freedom and an agility which I confess I sometimes view rather with alarm, because I move in them somewhat laboriously and with faltering steps. But I would like to try to explain in a few words the general effect of those paragraphs.
I think that some of the readers who have found difficulty in understanding them have been seeking in them some indication of further suggestions for dealing with unemployment. Any such search would be vain, because the purpose of the paragraphs is to explain the bearing on the problems of central finance of the proposals and suggestions which are made elsewhere in the White Paper. That is the whole purpose of the paragraphs. Therefore, when the first paragraph talks of "no deliberate planning for a deficit," all that that means is that nowhere in the suggestions that have been made earlier in the White Paper has there been any hint that an unbalanced Budget might be deliberately used as an instrument for improving the employment situation. All that the White Paper contains, in regard to the bearing of taxation upon this problem of unemployment, is to be found in paragraph 72. Then the passage goes on to make a contrast between productive and unproductive debt—unproductive or dead-weight debt, as it is called. It contemplates that the dead-weight debt might be written off at a time when the productive debt is still increasing, and it indicates that there would be a definite advantage in that process.
It goes on to say that the policy of reducing unproductive debt, while at the same time increasing productive debt, does not mean that the Government would be committed to a rigid plan of balancing Budgets year by year; and in the next paragraph you find the argument examined that interest charges, being in the nature of a transfer payment, do not involve any additional burden on the community. The paragraph points out that, while that is, in some degree, perfectly true, nevertheless, heavy taxation has a cramping effect on enterprise, and that, moreover, the growth of debt must always be considered in relation to the expansion and resilience of the national income. In that connection, one has to consider whether prospective increases in the national income are not perhaps already mortgaged, for example, by reason of an increasing disparity in the distribution of the population between the old and the young.
These points are all brought out in those paragraphs, perhaps with some degree of condensation, which has made the argument difficult to follow. But, finally, in paragraph 79, the point is made that, while problems of central finance must be dealt with on a balance of considerations, we must never leave out of account the paramount importance of maintaining confidence at home and, perhaps even more, abroad. For that reason, it is essential that, whatever may happen to the Budgets from year to year, they must be balanced over a period; and that must be seen to be a cardinal point in Government policy. I hope that I may have made clearer than it was in the text of the Paper what the purpose of these passages was.
You may not pay it back; you may put it into a parallel fund. I pass to the question which was put to me, of whether the Government mean in this White Paper to maintain the cheap money policy. There is a sentence in the White Paper which I think is to some extent ambiguous, because it talks about maintaining the cheap money policy as long as necessary. What it means is that special measures would be taken as long as necessary to maintain the cheap money policy. If there was any ambiguity, I am glad to have had an opportunity of clearing it out of the way. The White Paper might perhaps have been read as suggesting the possibility of short-term changes in the long-term interest rates. That, I believe, would have been quite unworkable; and the White Paper was not intended to convey any such suggestion. The reference to changes in interest rates was intended to apply to short-term interest rates.
I am sorry to have to dash from one point to another. My right hon. Friend talked about the policy of stable prices and stable wages. I think he asked me whether we meant by stable wages stabilising wages on a certain fixed level. My hon. Friend the Member for Walsall criticised the White Paper from a similar point of view. What we contemplate is a policy of stabilising wages, not on a dead level, but on an inclined plane upwards, if productive efficiency justifies the process.
Then there is a point to which my right hon. Friend, in that connection, referred when he mentioned what he described as a deflationary gap that may be found to develop. I agree with him that, in the transitional period, the problem will be a problem of an inflationary gap, but, after the transitional period, we may have an inverse position and the problem may be what I should prefer to call a deflationary overlap, where production is in excess of effective demand. [An HON. MEMBER: "That could never happen at any time."] That is what happens, in fact, though I agree that general over-production is impossible, in spite of Adam Smith. [Interruption.] The difficulty with the old school of economists is simply this, that, while their arguments were sound, they left the time factor out of account. They recognised the operations of natural forces, and accepted the results of the working of natural forces, but did not stop to consider what happens before the system came to equilibrium. A positive policy must inevitably take account of the time factor.
I should like to say a word or two about social insurance contributions. A novel suggestion was made in the White Paper as to the possibility of adjustment of the social insurance contribution as' a means of influencing the purchasing power in the hands of the community. It is a thing that has never been tried before, but the Government think that it might well be worth trying and that the effects might be substantial. But I do not quite understand where my right hon. Friend, and other speakers, got their figures, because they suggest that the effect would be limited, I think my right hon. Friend said, to a figure of £26,000,000 a year. In the Appendix to the White Paper the figure is put at between £70,000,000 and £80,000,000 a year. I know also that it is the view of quite competent persons in this matter that the actual effect of a change which had that arithmetical consequence might be considerably more.
Anyhow, if a change in purchasing power could be brought about to anything like that magnitude, its effect, taken with other devices that are suggested in the White Paper, might well be very substantial indeed. Everything does depend on the time factor and upon the Government being in a position to initiate action soon enough. It is just like trying to stop a pendulum. These cycles of unemployment have a rhythm, and if you try to interfere with them at the stage of maximum momentum you find it very difficult to achieve, but just 'as you can arrest a pendulum or stop it at the beginning of its period, so these cyclic variations in unemployment, and the alternation of booms and slumps, can be affected, if taken at a sufficiently early period, in a way which would be absolutely impossible at a later stage. I would say to the House, quite frankly, that these are matters all of us can afford to learn by experience. It is novel and it will involve a novel technique.
As to the possibility of supplementing the adjustment of insurance contributions by variations of taxation, I would refer only to paragraph 72 of the Report, and say that we ought, in my opinion, to be very wary how we play about with our taxation, for the purpose of producing a desired economic policy. I would not wish to rule anything out, but I say that we ought to proceed with very great caution. The hon. Member for Walsall spoke of structural unemployment, and put a very pertinent question—How would the problem of dealing with a depression in coal, or in the cotton industry, have been affected if the White Paper had been in operation when these problems arose? It is a very pertinent question, and I think the answer that can be given is that, under the plan envisaged in the White Paper, the Government would be continually watching these matters and would be in touch with the representatives of industry. Blizzards would be seen approaching, measures would be taken in time, involving perhaps, the early scrapping of out of date machinery, arrangements for training of workers who might be displaced and adjustments of different kinds which would be undertaken very much earlier than if the kind of organisation contemplated here had not been brought into existence.
No, not precisely the same. We had not the equipment to enable us to do it effectively. We are building it up gradually, but it takes a considerable time. Nothing of this kind has been done systematically up to now. The onset of depression may result from action happening outside our control, because unemployment often arises from unforeseen developments abroad. We propose, in this White Paper, not only a new outlook, but the development of a new technique. We have to build up our organisations, as I have said, and we propose to have a strong central economic staff, not to dictate policy, but to prepare materials and to see that the Government are in a position to take informed decisions on policy. During the war, we have had the means of dealing with a variety of economic problems. In peace time the position will be different. We shall have new problems, different in the transition period from those we shall have when the immediate effect of the war has begun to wear off. Nevertheless, I personally agree that, by working on the lines that are indicated in the latter part of this Paper, we shall be able to develop the organisation which will make it possible for whatever Government may be in office to take action on the lines indicated much more effectively than has ever been possible in the past. We must have the co-operation not only of the general public, but of public authorities of all kinds, financial institutions, industry and commerce, trade unions, and the private citizen also will have his part to play. If our action is successful, the reward for our action will be universal; all sections of the community will benefit. A high and stable level of productive activity and employment should bring advantages to every class. But the policy will certainly not succeed unless we can somehow or other ensure reasonable continuity. That is why it has been important to frame a plan which shall, as far as possible, be independent of purely party considerations. It is really of very great importance.
There will be plenty of room for changes and adjustments. The purpose of this Debate is to see how far there is, in fact, a general measure of agreement—not in every detail, and there is plenty of room for adjustment—on which continuity of effort can be founded. I feel very hopeful that if we can do that we shall be able to proceed to raise the standard of our community to a higher level and keep it on a higher level than we have ever seen before.
My right hon. Friend talked about continuity. Can he tell us at what point a beginning is to be made with this central staff for the collection of information, because many of us foresee problems after the war and would like to know whether a beginning will be made soon?
Yes, Sir, it has been to a very large extent built up; but it will have to be refashioned at the end of the war because it will be in part dependent on people whose services we cannot expect to retain indefinitely.
I have always had a great admiration for the personality and character of the right hon. Gentleman the Chancellor of the Exchequer, and never more so than to-day. Hon. Members, whatever angle of approach they may have to the problems of the White Paper, must recognise that he has endeavoured to take us into his confidence and tell us frankly what his views are and that he does not avoid the difficulties. The right hon. Gentleman to-day reminded me of the acrobat on a tightrope anxious not to fall either to the right or to the left. He was anxious not to fall either on the side of Socialism, or what is sometimes—I think wrongly—called capitalism. The right hon. Gentleman is in a unique position in the Government in that he has no party political label. I assume that he regards himself as the linchpin to bring together the various sections of the Government and make them work out a constructive policy.
It is very remarkable that here at a time when our Armies are locked in a life-
and-death struggle in Northern France and in Italy, and when infernal machines are being sent over for the definite purpose of destroying our nerve, we are fully debating this vital post-war problem. I hope that there will be wide publicity of the fact that we are discussing and facing the most difficult and vital problem of the world. The sentence of the White Paper that is significant is that the Government, for the first time—and this applies to Labour Governments, Conservative Governments and all previous Governments—have accepted responsibility for high stable employment. In paragraph 87 they go further, because at the end of the Report they say:
They seek to achieve work for all and a progressive increase in the efficiency of the nation
The Government at this very difficult time in our history have faced up to this most urgent problem. I am grateful—we all ought to be grateful—that the White Paper has been published. Of course, we do not accept it all, paragraph by paragraph. I doubt whether every Member of the Government accepts it paragraph by paragraph, but the fact that it has been published and that we are debating it is a healthy sign. I say, deliberately, that there is nothing particularly novel in the White Paper. We have been reading about these kinds of ideas for many years in the writings of many well-known economists. My right hon. Friend the Member for Carnarvon Boroughs (Mr. Lloyd George), who, I am sorry is not here, put his signature to a book commonly known as "The Yellow Book," or more properly called "Britain's Industrial Future." It advocated many of the things in the White Paper. That is 16 years ago. Therefore, I am not viewing this with. a critical and hostile eye. But time marches on. The theories which we rejoiced over, and which were rejected by the other two parties—and rejected at the poll, incidentally—and were considered very advanced and revolutionary in 1928, must be improved on in the light of the experience during the last few years, and particularly of the war years.
The nation has enjoyed the advantages of full employment in two wars, and the people are going to demand the enjoyment of the same economic prosperity in times of peace. If this Government or their successors try to wriggle out of their undertakings in promising to the nation a policy of full employment, there will be a terrible day of reckoning. I am glad that the right hon. Gentleman dealt with the pernicious fallacies of foreign trade of the hon. Gentleman the Member for Seaham (Mr. Shinwell). They had very much the flavour of the doctrine of Dr. Schacht, of economic self-sufficiency, one of the very things we are fighting against and one of the direct causes of this war. I do not want to see this country in a position of self-sufficiency. I want to see the interdependence of nations through trade, which is the only way to prevent war. The White Paper has rightly insisted that a level of employment and a standard of living do not depend only upon conditions at home. My right hon. Friend the Member for Wakefield (Mr. Greenwood) put it in another way, that this nation alone cannot solve unemployment. In fact, it would be deceiving the nation to guarantee a policy of full employment and suggest that we can maintain the ordinary peacetime standard of living yet cut ourselves off from the outside world.
The White Paper quite rightly reiterated, as proof of our intention to collaborate with other nations, the signing of the Atlantic Charter—which some people seem anxious to forget—the Hot Springs Conference, when we gave undertakings not only to the United States but to the United Nations—I commend study of that Conference to all hon. Members, for it is full of sound economics—and, thirdly, but not least the Mutual Aid Agreement of 1942 between ourselves and the United States of America. I shall not pursue that point because there was a Debate on the Dominions when that particular Mutual Aid Agreement loomed very large; in it we agreed to the elimination of all forms of discriminatory treatment in international commerce, and to a reduction of commercial and other trade barriers. The hon. Member for Seaham has a bee in his bonnet about the United States of America; he is always going out of his way to give a kick at the economic policy of the United States. We recognize the fact that they have a high tariff and have tried to be self-sufficient, but we should do everything to encourage the collaborators in the United States who are seeing the unwisdom of their former economic policy. The fact that they have signed this agreement is evidence that they are anxious to break down tariff barriers.
In my view, this involves a reversal of the Ottawa spirit—I attach more importance to the approach than to the actual agreement. If we accept Chapter I of the White Paper, that we cannot achieve the highest level of employment without effective collaboration among the nations, then we must make the world our market. By all means let us collaborate with the Dominions and the Colonies. If we do our best to develop the Colonies we shall be repaid one hundredfold in an abundance of trade which will stimulate our people. But we do not want an exclusive policy. We must be ready and willing and anxious to come to trade agreements, not only with the United States of America, but also with the U.S.S.R. and, I would add most emphatically, the great Chinese Republic, which offers immense potentialities for the exchange of goods, for trade and for development. It is a very significant fact that at this very moment there is a distinguished American industrialist in Russia trying to come to trade agreements, and no less a person than the Vice-President of the United States, Mr. Wallace, is now in Chung-king no doubt bent on the same mission. It would be most unfortunate if it were thought abroad that, when the war is over, we shall try to draw in our horns and return to the Ottawa spirit and try to cut ourselves off from the rest of the world. I am quite sure that the Chancellor of the Exchequer is much too wise to swallow such ideas.
There has not been much reference to what I may call the transitional policy. I think that part of the White Paper is excellent. I do not think we shall have difficulty, immediately after the war, in employing the whole of our population; we did not after the last war. There will be a shortage not only of all consumer goods but a demand for every kind of capital goods, not only in our own country but throughout the world, and the change over from war to peace will be gradual. But in that stage when trade is good and there is employment for all we should start to build on sound foundations and always think of the long-term policy—there is a great danger, when everybody is making money and earning good wages, of taking short views. Much depends on a sound money policy, but we have had one Debate on that and I shall not pursue it. I was satisfied with the Chancellor of the Exchequer's statement. I am not one of those who make a bogy of Lord Keynes. I think he is a very brilliant man, very versatile and adaptable, perhaps a bit mercurial as my right hon. Friend the Member for Carnarvon Boroughs says, but he is a brilliant man and I think the Government are very wise to make use of his abilities in negotiating with other countries.
If I may, I will follow the Chancellor on the vexed problem of private enterprise, which is another bogy. I do not mind saying that I am all for private enterprise, for a spirit of adventure after the war. You want to encourage the returning. Service man to go into business. Young men should be encouraged to show an enterprising initiative and open up new industries and new business. It is the age of the technician and of invention, and we do not want the technician to have no scope for his ability except under the State or under monopoly. In my view the Chancellor was perfectly right: there is room for private enterprise and there is room equally for the development of public concerns under State control. Where monopoly can be shown to exist, it is essential that the State should face up to it.
I welcome paragraph 54, except that it approaches the subject too tenderly, and seems too afraid to offend combines or to criticise trade agreements. As long ago as 1918 a committee was set up to investigate the problem of monopolies, combines and cartels. It was under the chairmanship of Mr. Shortt, K.C., afterwards Home Secretary, and the Report was actually signed by Mr. McCurdy, who also eventually became a Minister of the Crown. That Report definitely recommended the setting up of tribunals to investigate the operations of monopolies, combinations or trade agreements. It advised the appointment of a permanent chairman, and that any trade or industry which was under the suspicion of being a monopoly should be investigated and reported on to the Government. We move slowly in this country. That was 24 years ago, and we are still talking about this problem to which we have not yet faced up.
Here I might also say the Yellow Book made very definite and constructive pro- posals. In my view, if a monopoly is a conspiracy against the community and is not necessary, it should be declared illegal. On the other hand, if it can be found to be necessary to ensure efficient production, or to render a particular service, then it should be run—here I agree entirely with the hon. Member for Seaham—not by a Government Department but in the form of a public utility company or a board, very much like the Port of London Authority or, alternatively, the London Transport Board. We do not want, in 1944, to be hindered or handicapped by doctrinaire ideas, either suspicion of private enterprise or fear of nationalisation. Each problem will have to be faced on its merits. The only test will be that of public good.
We have heard a good deal of discussion about so-called functional employment. During nearly five years of war, under the incentive of fear and the necessity of rearming the nation, technical improvement has been remarkable. In many cases one machine has enabled one man to do the work of three, but no one has been put out of work, because the demand for commodities has been so great. When peace comes along the machine—and this has been our difficulty for over 100 years—pushes out the craftsman and unemployment ensues. America is miles ahead of us in the technical exploitation of industrial power. We can all agree that whatever our remedies may be we should do nothing to put back the clock or discourage high efficiency in our industrial organisation and the use of every technical appliance. If we are to hold our industrial position in the world our plant and industries must be up to date and efficient. There, again, comes in the question of monopolies. Only too often the advantage of proved technical methods has been that prices have been maintained and profits have been increased while men have been thrown out of work. Where there is competition it is impossible to keep up prices but where there is a monopoly the advantage goes in increased profit with no gain to the user or consumer. One example was the high price of steel. The attempt to bring our steel industry up to date was held up because of vested interests. Technical improvement does not necessarily mean less employment; on the contrary, if the public is given the advantage of a reduction in prices it should increase demand and with it more employment. That is where the Government have a great responsibility to act as the guardian of the community, especially now they have assumed the responsibility of safeguarding us against large-scale unemployment.
A word or two about cycles of unemployment. Our economists seem to regard cyclical unemployment as inevitable, that slumps and booms are a kind of law of nature which we must accept, like measles. I think here the White Paper, in dealing with this problem, was timid and afraid to upset industry and employers. The Report suggests that we should go cap in hand to industrialists and ask them what their capital commitments are likely to be. I take the opposite view; I think the State has a direct responsibility to acquire information from industrialists about their projected schemes for industry. That brings me to the whole question of capital investment from the point of view of unemployment. Most economists argue—I do not know how rightly—that one of the worst of the immediate signs of trade depression is the curtailing of capital expenditure, which reacts right throughout the country on the basic industries. Some of us, for a long time, have recommended a board of national investment, the object of which would be to stimulate capital expenditure not only among local authorities, as my hon. Friend the Member for Peckham (Mr. Silkin) insisted, but among Government Departments, not in times of prosperity and boom but in periods of depression. My hon. Friend was right when he said it was no use waiting until a slump was upon us. The thing to do is to anticipate it. If every industrial undertaking, over a certain number of years, was required to inform the Government, quarterly or annually, of its projected schemes for expenditure on capital goods, then a board of national investment would be able to extend capital expenditure, both of the State and local authorities, according to the state of trade and make a definite contribution to the ironing out of slumps and booms.
That, of course, is one definite way of maintaining consumption when we are threatened with a period of trade depression. I am attracted with the idea, in the White Paper, of varying rates of insurance, variation of social insurance con- tributions. It is perhaps the one novelty in the White Paper. If, as the Chancellor says—and the White Paper confirms it—in times of depression, instead of increasing rates of insurance, as in the past, we were to reduce them, it would help to pour in purchasing power at a time when industry was depressed, and when the purchasing power of the community was decreasing. But I rather agree with some hon. Members in being a little critical of this particular instrument, with all its attractions. After all, rates of wages vary enormously. To a man making £10 a week, 5s. 6d. is immaterial, but when you come to the lower scale workers, a 5s. 6d. insurance contribution for a man earning £3 a week or less comes very near to a poll-tax. I cannot quite understand the Treasury attitude in accepting the unbalancing of the insurance fund while at the same time insisting on orthodox finance when it comes to the Budget. I should have thought that a fairer way of stimulating consumption in bad times would have been to lower the rate of Income Tax. That would be fair, because it would mean that the man with the small income would contribute his fair proportion and that the man with the larger income would get an advantage according to his income.
I was rather surprised at one matter which is forgotten in the White Paper—that is family allowances. When we had our great Debate on the Beveridge Report very few of the recommendations were accepted. The one thing that was accepted was family allowances. Somehow we have forgotten that undertaking. Nothing would contribute more to even out slumps and booms and prevent a decline in consuming power when trade was bad. Perhaps the Minister of Production, when he replies, will not forget this important contribution to the problem of maintaining consumption in time of trade depression and tell us whether the Government have in view or have thought out a method of definitely implementing their promise to introduce the policy. The hon. Member for the English Universities (Miss Rathbone), who has been for so long associated with this policy, is not here, unfortunately, owing to indisposition, and I feel that I must see that her pet remedy is not forgotten.
To me, one of the most attractive proposals of the White Paper is the setting-up of an Economic General Staff. Here again, is something that has been advocated for many years. As long ago as 1917 it appeared in a Government Paper. It was put to the Labour Government in 1924 and was turned down. No one seems to understand why. It appeared in "Britain's Industrial Future," when a whole chapter was devoted to it. It was pressed on the Government and turned down. No one understood why. At last it appears in the White Paper as an original proposal. We are thankful for small blessings, and we are glad to have it, but we want it to be a reality. We want the staff, to be effective, to be supplied with proper statistics. It is only recently that there has been a serious attempt to collect full statistics of industrial life. There should be a Minister of rank not less important than the Minister of Defence, responsible for reviewing the whole problem of unemployment and economic progress. It is very satisfactory, as I am raising this point, that the Minister of Production should be here. His post has been created to meet our requirements in the light of experience under the pressure of war. He is responsible, as I understand it, for surveying the whole economic problem and co-ordinating it so that the best use should be made of our industrial resources. If this proposed Economic General Staff is to be effective, it should be responsible under a Minister, who should have a position in the Cabinet equal to the Minister of Defence and co-ordinate the various activities of Ministers in our industrial life. It was suggested the other day that it should he largely vested in the Board of Trade, but I do not think that that would be satisfactory as so many Departments are concerned—the Ministries of Labour, Health, Town and Country Planning and Building Construction. I give my general blessing to the White Paper.
I should like to give a welcome to the White Paper, not that I regard it as a complete thing, but because I regard it as a declaration on the part of the Government to deal with the problem of widespread unemployment. At this stage it is nothing more than that. I welcome it, too, because I think it is a complete repudiation of the policy that brought into being such things as the Geddes Committee, the May Committee, the General Strike and various other very diffi- cult things that happened in the inter-war period. It brought us, too, the means test, and all the troubles that we have had in connection with it, and the large amount of industrial depression that we had during that period. The Minister of Labour, in a speech which I thought was of very high order indeed, intro duced this new declaration on the part of the Government. He referred to the General Strike and to his association with it. He did not apologise for that at all, and I am glad he did not. I think he regarded it as a consequence of the policies that had been pursued. I am glad, too, that 18 years afterwards he has now had an opportunity of submitting a policy, which, I hope, will make unnecessary any such thing as a General Strike in the future.
I am confident that there are many difficulties ahead in working out this policy and there will be a large number of people who will oppose it. Particularly will there be hon. Members opposite who will offer opposition, perhaps not in words, not by public declarations in the House and in the country, but by various means in the industries—by every means they can call to their command. Yesterday we had one hon. Member who said he did not think it was possible. The hon. Member for West Fife (Mr. Gallacher) had extended a welcome to the Paper, though he thought it was almost impossible to put it into operation, under the private ownership of industry. The hon. Member for Hastings (Mr. Hely-Hutchinson) said that, in his judgment, it would not be possible to operate the policy with private ownership, and he caused us all to look up rather suddenly, when he said he was in agreement with the hon. Member for West Fife.
That was the only definite declaration that I heard during the Debate from the other side—that the policy cannot be operated under private enterprise. Whether it can or not, remains to be seen. I do not think we need wait to discuss it in detail here. There is however urgency for steps to be taken now in order to prevent unemployment in the future. It is interesting to note that this subject, or one very close to it, was discussed in the British Parliament as early as i6ar. At that time there was a great depression in the cloth trade and there was a Debate. They did not then have to deal
with theories like those of Adam Smith because it was easier for them to see, what was happening. An interesting observation was made in that Debate by a Member of the House, named Sir Edward Sandys. He said:
Unemployment is not due to lack of the fruits of the earth, thank God, but it is due to the lack of money.
It is rather extraordinary that that situation should have arisen in 1621 when there was insufficient money to buy back what was produced. It is rather close to the subject with which we are dealing now. The matter was dealt with rather effectively. Provision was made, as far as I have been able to ascertain, from which better trade resulted, and I am hoping that better trade and full employment will result from this Debate.
There is another interesting thing in the records of the House, not so long ago. On 10th May, 1911, the late Keir Hardie introduced the Right to Work Bill. He said it was a Bill to make provision for work or maintenance for the unemployed. His proposals were that the unemployed, after being out 9f work for seven days, should be registered and, unless work was provided for them, they were to be paid a subsistence for themselves and their dependants, of such an amount as would be determined by the medical officer of health for the district. There was also provision for training the unfit. It is extraordinary that we have only recently passed a Bill for the training of people who are not fit. Keir Hardie's Bill was actually introduced several years earlier than 1911, and it was being introduced year after year, but the House took no notice of it. In the speech that Keir Hardie made on 10th May, 1911, he said—and this was prophetic:
There are signs that the boom is becoming exhausted in this country.
He went on to say:
When unemployment again becomes prevalent this country should not be humiliated by the spectacle of honest men and women being deprived of the opportunity of making a living by the right to work.
I have just listened with a great deal of interest to the speech of the right hon. Baronet the Member for South-West Bethnal Green (Sir P. Harris). If I remember rightly, in 1911 a Government of his turn of mind were in existence, but they took no action with regard to the
proposals of Keir Hardie. Year after year from 1906 his Bill was introduced, and no steps were taken to deal with the problem. There was an almost complete disregard of the point of view that Hardie was expressing. He was a Scottish miner who was prophetic, wise and far-seeing. That was 33 years ago. Now the House is beginning to discuss this problem again.
I have said many times in the course of my life that a late settlement is usually a bad settlement. A late Bill is not as good as an early Bill would have been, in dealing with this problem. By what happened in the inter-war years, the situation has been made extraordinarily difficult. I remember my own experience in South Wales. We had, in 1920, about 270,000 men employed in the mining industry. The Government, instead of facing the problem, handed the mines back to private ownership and immediately the industry went into the international market, when coal was selling for about £2 a ton. Within a short period, the selling price was reduced to about £1. The consequence was that in March, 1921, the employers declared a lock-out. The men were driven out, and by the lever of poverty, the men were beaten in three months, and went back to work. By November of that year the men in South Wales had their wages reduced by no less an average than £3 per week per man, which for the whole country meant a contraction of £150,000,000 a year in purchasing power. As a consequence, the cotton trade and the engineering trade fell, and prices went down. There was no proper attempt to control the industry and to keep prices and wages on an even keel.
Is it not a fact that in 1921 the total volume of money in this country was deliberately reduced, not by industry but by the policy of the Bank of England in destroying purchasing power?
I had a share with my hon. Friend the Member for Llanelly (Mr. J. Griffiths) in the negotiations at that time, and the coal-owners said many times that the miners would have to work for less money and under bad conditions, in order that we could compete with everybody in the world. The Bank of England were joint criminals, there is no doubt.
The consequence of that has been seen. In South Wales the 270,000 miners have been reduced to 105,000, and in the country as a whole 400,000 miners have been lost. As a consequence, we got very near during this war to a serious shortage of coal. Had the matter been carried very much further we might have lost the war as a result. In one of the periodic strikes and lockouts the boards of guardians could not relieve the men, but they relieved the dependants, provided the men worked on relief work. So the men worked, and made a road in my division, and to this day it is called the "Bob-a-Day" road. The men were paid a "bob" a day relief for making the road. During the slump of the inter-war years 413,000 people left South Wales. The place was denuded of its young people, and the average age of workers in the industry is particularly high as a consequence. Coal was not the only trade that contracted. The steel trade contracted until the war came. It is the variations in trade from year to year that are so upsetting. I was told only yesterday by an authority, that the production of heavy steel in this country varied between £4,000,000 and £13,000,000 in the inter-war period. Industry is badly organised when it arrives at that stage.
I welcome this Paper, and I am glad that the Minister of Labour had the pleasure of introducing it. It is a policy that we of the Labour Party have attempted to pursue for a very long time. We have long asked for it to be established, and I am looking forward to the time when it will be put into operation. I know there are difficulties involved, but they must be faced. If, ever again, we get into a period of trade depression such as we previously experienced, I do not think that the country will come through it as well as it did on the last occasion. Some years ago, a very important personage 'came to my division and met a number of unemployed. Twelve of them stood out, lean and hungry-looking men, and this personage walked across and spoke to them. He came to a certain man and said: "You were at such and such a place in the last war." "Yes, Sir, I was," replied the man. They conversed about it for a time, and then the person- age said, "You are unemployed. How long have you been unemployed?" The man replied, "I have been unemployed for eight years, and during those eight years my wife and children have never had anything new to wear." That was the state of things that existed. All that must be changed. If it is not changed, this country will get very much poorer, too poor to remain a first class nation. That is what a continuance of the old policy means.
I should like to say a word about international trade and what I regard as the fundamental requirement for it. Our industries have to be made efficient. There are many that are not efficient now. Look at the coal trade. You will find some pits that are efficient and some that are not. That runs throughout industry. Let me look at steel for a moment. Steel is among the most fundamental things in connection with our exports. I believe it was mentioned yesterday and I apologise if I repeat anything that has been said, but I think it is important. The steel industry has been organised in this country, with so much unnecessary capital, with certain objects in view, that the industry, on its present basis, cannot supply steel to other industries as cheaply as it can be supplied in some other countries. I believe that the motor-car trade, a very big industry, and the railways, are paying comparatively high prices for steel. America is supplying motor-car manufacturers at the moment with steel for the bodies of motor cars, at rather less than half the price at which our motor manufacturers have to pay. How can we compete in those circumstances? The motor-car trade ought to be an excellent thing for export. We ought to be able to export motor cars to people in our Colonies and Dominions, and even to foreign countries, but if that situation is maintained, and if the motor-car trade is to be handicapped in that way, I see little possibility of developing its international trade on a large scale.
These matters should be looked into at once. I want things done on the basis of this Paper, as early as possible. I want to avoid the possibility of our sinking into disaster after this war is Over. I do not want to repeat what was done after the last war. I hope that the enthusiasm, wisdom and forcefulness which were in the speech of the Minister of Labour yesterday will be continued, until such time as we have put into operation everything that can be put into operation from this White Paper. If it is found that the proposals of the White Paper cannot be applied to private enterprise, the undertakings must be taken over for public enterprise. On no account can we allow such a situation as we had after the last war to recur. I welcome this Paper, recognising its limitations and believing in public ownership. I want to pursue that object as fast as it possibly can be pursued. In the meantime, I want definite action taken immediately so as to make impossible large-scale unemployment such as we had after the last war.
I doubt whether any sensible man would hold the view that this country, or the other countries involved, could go through two world convulsions such as we have experienced and at the end expect to find everything pretty much the same as before. That is one reason why many of us have had to change views that we held in pre-war years. We heard a dramatic speech yesterday from the hon. and learned Member for Carmarthen (Mr. Moelwyn Hughes), who argued that the White Paper torpedoed—"exploded" I think he said—tariffs, the Liberal policy of free trade, Socialism and various other minor philosophies. That speech was an indication that the White Paper attempts to interpret the altered views which modem events have compelled many of us to take. Among all the White Papers the Government have so far presented dealing with post-war problems, this Paper on unemployment policy is the best. It erects a good many direction posts, pointing the way to most desirable objectives, while, at the same time, posting up certain warning notices which all of us would do well to mark. It is easier to postulate a policy than it is to consummate it, and we must all face the fact that the proposals which we are discussing in this three-day Debate are largely in the nature of experiments to be carried out over unexplored ground. Time alone can show whether success or failure will emerge as the result of these experiments.
Am I qualified to intervene in a Debate which deals with unemployment policy? Perhaps the House would forgive me for striking a personal note for the moment. I have been engaged in industry for considerably over 40 years. I started at the very bottom of the ladder and, in the progress of time, it has fallen to my lot to serve in municipal service, in private enterprise and in Government Departments, which after all is a very useful experience. It gives one an insight into the good and the bad in all these respective administrations. I have also been fortunate enough to have had the opportunity of travelling to some of our Dominions and Colonies, and to various parts of Europe, endeavouring to get business for the Home Country. Therefore, may I modestly claim that such knowledge as I have, has been acquired in the hard school of experience, and not by the academic study of theory? While I give general approval and support to this Command Paper, I have taken the trouble to fortify my own views by contacting leaders of industry in many parts of the country, and I find that the views I have expressed are very widely shared. I think it can be said without contradiction that, although, of course, questions may be asked on this or that part of the White Paper proposals, in general industry is prepared to give them wide support.
In fact a good many of the suggestions in the White Paper have already appeared in booklets, pamphlets and in speeches from great industrial associations, and therefore it is not surprising that there is much common ground. This common ground may be said very generally to include these points. First, I think all sensible people have recognised, even if they do not like it, that, at any rate for some time to come, there must be a continuance of rationing and of price control. Where these restrictions are not essential for the problems we are discussing, they should, of course, be removed, but where they are necessary to carry out this policy I do not think anyone in their senses would deny that they must be retained. Though one does not like being interfered with in what one does with one's capital resources, I think we must be prepared to recognise that if we are to do away with the peaks and valleys of employment, we must be prepared for some control over the timing of capital expenditure. There is one point with which the White Paper does not deal, and about which I am most anxious the Government should make some pronouncement. I do not want to see repeated what happened after the last war, when some undertakings acquired many others, at highly inflated values, and within a comparatively short time, millions of capital, in consequence of these amalgamations, had to be written off, with grave consequences to the shareholders who were foolish enough to invest their money in these combines, and to the employees, many of whom were very shortly afterwards put out of work. There should be some control over undesirable amalgamations, so that this piece of history will not be repeated.
Though I dislike it intensely, I feel I must be prepared to agree that the Government are right in endeavouring, as reasonably as they can exercise it, to have some control over the location of new industries. It is necessary when there are areas so dependent upon one industry, such as coal, iron and steel or cotton, that, wherever possible, new industries should be located in the areas where labour and homes may be available. I would, at the same time, utter one word of warning, which is that if a Department is set up to decide where enterprising business men are to establish new industries, it must act intelligently and promptly. It is no use trying to persuade a firm that may be developing some new invention of the greatest importance which will expand our exports, to locate themselves where the conditions may be wholly unsuitable to efficient production. I have had some experience of the mischief that can be done by locating industries in the wrong places, which I could give to the House if time permitted.
I want however to pass to other matters. May I say, as one who has for very many years been on the best of terms, I am happy to say, with Labour, there is no hope of success in securing the maximum employment, unless managements have the wholehearted co-operation of Labour. This is pointed out in the White Paper, and, as my hon. Friends opposite know, just as there are good employers and bad employers, so there are good trade unions and trade unions which, shall I say, are not so good. There are some with whom one can live peaceably and happily, and on terms of good comradeship; there are others, where there may be an odd man or two, who thinks his main purpose in his position is to create as much trouble as possible. The trade union leaders, of course, know well their own black sheep, and just as it may be necessary for Indus- try to submit to some extent to discipline after the war, so I think the responsibility will lie on trade union leaders to see that discipline, which in some cases has become rather slack in the course of these war years, is restored after the war, so that we may all endeavour to pull together.
I would like next to make a reference to cheap money. Of course, a continuance of that policy is absolutely essential. It may be a good plan to try the practice of varying the rates of interest, as a matter of policy, to deal with threatened slumps, or with periods of boom, when we want to slow down an unhealthy rate of expansion. Stability in wages costs and in international currency are more important, perhaps, than some hon. Members realise. I speak from experience of having to quote for big civil engineering contracts—this happens more often in overseas contracts—the completion of which may take three, four or five years. If, assuming that we were at peace again, I had to quote for a contract, say, in Malaya, which would take four or five years to carry out, I should have to quote a price which would take care of any risks that might have to be faced, not only in regard to differences in wage rates in that period, but also in regard to differences in the value of money. Therefore, stability in these matters is of the highest possible importance, if business firms are to run the risks of manufacturing machinery in this country which provides employment.
I come to the reference in the White Paper to future budgeting. If I understand it correctly, the Government intend that, in good periods, the Chancellor shall accumulate surpluses, so that in bad years he may budget for a deficit, always with the proviso that, over a period of years, the Budget must balance. That is what one does in business: one creates additional reserves in good times, so as to have them available to meet the storms in bad times. This is a policy which the Government should encourage local authorities to practise. It is common sense that, when wages are good, ratepayers will be able to afford higher rates, better than they are likely -to be able to do during the transitional period from war to peace production. On all these points, industry, generally, finds itself in support of the Government's proposals.
I have a few questions to ask. This Government central staff which is to be set up, and which is to be qualified to measure and analyse economic trends, will have a task of the highest importance. I should like the Minister of Production, if he will be good enough, to enlighten us more to-morrow about this central staff. I imagine that it is going to be a permanent body. It will be very necessary that it should be strengthened and refreshed from time to time, by bringing in recognised experts from outside, to consult with those who may be on the permanent staff—I do not mean experts representing the management side of industry alone, but experts who can speak from the labour point of view also. Then take shipping. There are few of us who do not realise to-day, as never before, how our lives depend upon our Mercantile Marine. It will be our solemn duty, after the war, to see that our shipping never again gets into the moribund state into which it got after the last war. How much does that depend upon what arrangements we come to, particularly with the United States, who have established a huge Mercantile Marine? I can never cease to think of what we owe to our merchant shipping, since the days when, to cross the seas, was to face appalling dangers. It is true that we have largely mastered those dangers now, but I am looking to the future of an industry than which none is more important. We have, wisely or unwisely, agreed of late to provide stability of wages, and I hope of employment, for those who go down to the seams in shifts. I want to hear from the Government what we are going to do in future, for those who go down to the sea in ships. The importance of exports——
Yes, I have a good many ideas, but I do not want to make my speech too long. I think I shall have to leave that for another occasion, or I am afraid I shall incur your displeasure, Sir, and then I may not catch your eye again for months to come. Just one word
about exports. I want to refer to a statement in the Prime Minister's famous broadcast speech of March, 1943, when he said:
Anyone can see the difficulties of placing our exports profitably in a world so filled with ruined countries. Foreign trade, to be of value, must be fertile.
This is the important condition:
There is no use in doing business at a loss.
In pre-war years, I am afraid, it is only too true that a good deal of our export business was done at a loss. I should like to know whether the Government agree with the Prime Minister's dictum, and, if so, what action they contemplate, so as to make it reasonably sure that the important business of export after the war is not done by this country at a loss, which, as the Prime Minister rightly said, is of no use. We shall, no doubt, have to lend vast sums of money to countries overseas, and it might be one of the conditions that these moneys lent, either free or at some very low rate of interest, shall be utilised by these countries in buying their requirements from us, at prices which must be reasonably agreed.
Then there is another very important point not referred to, I think, in the White Paper upon which I would like some further enlightenment. I do not know whether hon. Members will remember that, at the end of the last war, we had accumulated Government stocks, I think, of a total value of about £800,000,000. What the total stocks will amount to at the end of this war, heaven knows, but, in all probability, it will be a figure at least twice that. These stocks, in the taxpayers' interest, will have to be liquidated, and if that liquidation is not carried out with the greatest intelligence, the disposal of those stocks may have a very adverse effect on employment, Therefore, while we are considering employment policy, I make no apology to the House for having stressed the importance of that point.
I come back to the question of Excess Profits Tax. Those of us who are responsible for industry and providing employment want to know as soon as possible what is to be the E.P.T. policy after the war, because it must have an important bearing upon the prices that we dare risk quoting, not only for business in this country, but for the important export business which we must contrive to get. My last question mark is this. What are the Government going to do after the war in the way of reducing intensely swollen Government staffs?
I cannot conclude my remarks without emphasising to the House that there is a very big warning in the Government's White Paper. In their Foreword, the Government make it clear that they are seeking to create, through collaboration between the nations, conditions of international trade. I am quoting their words:
that will make it possible for all countries"—
not only our own, but all countries—
to pursue policies of full employment.
But they wisely add:
If, by these means, the necessary expansion of our external trade can he assured, they believe that widespread unemployment in this country can be prevented by a policy for maintaining total internal expenditure.
I ask the House to note that it is a very big "if," which raises two other important questions. Will other countries, with wage rates lower than ours, and with whom we may compete, be willing to establish wage rates comparable with those prevailing in this country? That is the first big question. The second is this. Will the Governments of other nations be prepared to raise the standard of living in their countries, to make it comparable with ours, and with relative social services? I think so much depends, for our competing power, upon the answers to those questions, that it is only right and honest that I should point out their great importance.
If the Government succeed in securing agreement with other countries—and it takes two or three, at least, to arrive at agreement, and I am going to be bold enough to hope that they will succeed—then I say this, to myself and to my industrial colleagues throughout the country: "This White Paper will then become a definite challenge to industry and to the conduct of our great industries under private enterprise"—or, as I prefer to say, free enterprise, because that is the correct term to use. Although I am not so young as I used to be, I think that the time has arrived when many of us 'have to consider whether we should not have what I call "a new philosophy of business." What do I mean by that? I mean that I think it is up to business management to produce, and to see that their factories are efficiently equipped to do so, at the lowest possible cost; that they should embark upon an expansionist policy; that they should be able to rely upon labour assisting them, to the best of their ability, at good wage rates; that selling prices should be such as to secure what I call a modest return for capital, and, perhaps, fewer of those larger rewards to individuals that may have been thought appropriate in the past. That is my philosophy of business in the year 1944. There may be many in industry who would not share my views, but I think that the only way in which we can successfully meet the challenge which will arise, if the Government can secure successful collaboration with other great nations—America, Russia and, later, China—is to adopt the new philosophy which I have just ventured to submit.
Above all, somehow or other, we have to secure confidence. Confidence in the Government that we can rely upon a stable policy, confidence that this country is going to be safe in the future, and not subjected to the risks of 'war, and confidence that, when agreements are made with other countries, they will, and can be, looked upon as inviolate. I finish by quoting again from the broadcast speech which the Prime Minister made in March last year: Towards the end of that speech, he said:
Our fortunes will be greatly influenced by the policies of the United States and the British Dominions, and we are doing our utmost to keep in ever closer contact with them.
In another sentence, the Prime Minister said:
I tell you my solemn belief, which is that, if we act with comradeship and loyalty to our country and to one another, and if we can make State enterprise and free enterprise both serve the national interest and pull the national wagon side by side, then there is no need for us to run into that horrible devastating slump, or into that squalid epoch of bickering and confusion which mocked and squandered the hard-won victory of a quarter of a century ago.
The Prime Minister also said:
It is all the more vital to revive at the earliest moment a widespread, healthy and vigorous private enterprise, without which we shall never be able to provide, in the years when it is needed, the employment for our soldiers, Sailors and airmen to which they are entitled after their duty has been done.
I venture to say this to the House. It will be wise for us, as older men, to keep those wise words of the Prime Minister
ever in our minds. If we do not, then, in my view, the younger men of this country and of our Allied countries will have fought in vain for the preservation of their countries, for the liberation of the other nations, over-run as they have been, and for freedom for all to make this a better world.
It was with very great regret that I learned, Mr. Speaker, of your intention not to call the Amendment tabled in my name and the names of hon. Friends. In my submission that Amendment crystallises the whole of this problem. The hon. Gentleman the Member for Stockport (Sir A. Gridley) stated that he did not like the expression "private enterprise." I agree with him; I would prefer to call it "capitalism." Under capitalism we shall not get full employment, and we cannot have full employment—a fact which has been freely admitted—but in the common ownership of the great resources we can, and should, get that full employment which we would all desire. I have stated repeatedly, from the time of my election onwards, that I do not consider the present Government a fit and proper Government to legislate for the days of which we are thinking. I adhere to that statement. When discussing this White Paper we should examine closely the parentage from which it springs. The right hon. Gentleman the Member for East Edinburgh (Mr. Pethick-Lawrence) referred to its mixed parentage, and with that expression I fully agree. We cannot succeed in conquering this problem by any attempted compromise. Certain pledges were given at the time the Labour Party entered the Government which have not been adhered to. The Labour Party—and I say this with no disrespect but with the greatest respect—have adhered loyally to their part of the bargain, but I regret that the Government—this present Coalition—is rather an unholy union of opposites. A nagging wife sometimes accomplishes something, but the Labour Members of the Government have not, to my knowledge, even nagged. They have adopted the position of the meek submissive wife—submissive to every whim of a tyrannical husband who has imposed his will upon her.
I regard the weaker partner as the wife; that should be fairly obvious. Worse than that, they are not even married. In fact, they are not even in love. I have not detected any sense of growing affection between them. But, worst of all, they are now producing offspring, and the latest offspring of this illicit union is this White Paper on full employment. One can detect in the White Paper the influence of the weaker partner in that the Labour Party have apparently successfully diagnosed some of the causes of recent disasters and have even suggested certain remedies. But the dominant influence in this White Paper is that of the male partner, who has insisted that at all costs capitalism and the influence of capitalism must be maintained in our national life. It is going to be disastrous if we cling to that in the world of the future.
The White Paper correctly recognises that the volume of employment varies directly with the volume of expenditure. That is true. It also recognises, on page 16, that if more money is spent on goods and services, then more money will be paid out as wages and more people will be employed. We recognise that it does diagnose some of the causes, but we have a pretty poor opinion of a doctor who successfully diagnoses the cause of an illness, and then refuses to apply the remedy, because he does not like performing the particular operation that is called for. That is the position as I see it, at present. In order to get the full employment which we want, a major operation is necessary, and, let us confess, the Conservative Party are not prepared to effect that major operation. It states in the White Paper, as one of the reasons for maintaining capitalism, or rather one of the difficulties of obtaining full employment, that
The Government cannot control private investment.
Of course, they cannot. We, on this side of the House, have been saying that for a long time. But there is one method by which private investment can be not only controlled, but directed into the proper channels, and that is when the State itself takes over the means of production, and itself directs capital, in order to promote employment, into those industries. It is not sufficient, as this White Paper attempts to do, to tackle merely the problem of
mass unemployment. It has been remarked on various occasions that the words "full employment" do not occur once in the whole of the White Paper; in other words, a purely defensive war is to be waged against the mass unemployment we knew before the war. That is not sufficient. We suffered heavily in a military sense at the beginning of the war because we attempted to wage a defensive war against the Blitzkrieg—a defensive war which became known in various parts of the country as a "phoney" war. Are we to be accused of waging a "phoney" war against unemployment? We shall be, unless we tackle this problem at the roots.
It is not only a question of tackling mass unemployment but of realising that we have to develop the resources of this country, to adopt a policy of maximum production, in order to build up the standard of life of all our people as well as to grant full employment to all our men and women who are at present engaged in various theatres of war. We have seen in the past that under capitalism full employment cannot be provided, and also that a satisfactory standard of living for our people cannot be built up. My hon. Friends from South Wales will remember the position before the war when we had 2,000,000 or 3,000,000 unemployed for whom capitalism could not provide a job. My hon. Friends will remember the families of those men in South Wales, children who could not go to school because they had not shoes to put on their feet, who could not absorb the education and the training they were given because their little bodies were undernourished—the derelicts of capitalism. It was not as if we had not work for these men to do. There was plenty of work to be done, there was land going uncultivated, there were mines derelict, shipyards derelict, factories standing idle and containing idle machines which these men could have been working.
If hon. Members talk about money, it was not as if we had not money with which to do the jobs because, throughout that time, there was more money lying idle in the banks of this country than we have known before in the world's history. Capitalism could find no way of directing that money into the proper channels. Capitalism could find no way of employing that money in order to open up the mines and the shipyards and the factories to get the land cultivated, to put these men to work to produce the goods which the people of this country needed so badly. It could not be done, and it cannot be done under capitalism, and the sooner this House and the Government face up to that fact the sooner we shall have a decent land for our men and women to return to after this war.
I feel that this problem is linked very closely with the problem of demobilisation. I receive many letters from men in the Forces, all of whom ask what is to happen to them when they return from their duty overseas, when they are demobilised after this war. They ask, "Have the Government any demobilisation policy? If they have, why do they not announce it?" I feel that their fears and suspicions could be allayed to a very great extent if they were assured of a policy which was, in fact, one of full employment and of full production. Then they would not worry so much about what will happen to them.
In conclusion, we realise that hon. Members are divided between the preferences for capitalism and preferences for common ownership, or Socialism. The problem is not which is the preferable system of the two, so far as our individual tastes are concerned, but which of these two systems is to provide employment for all our people and a constantly rising standard of living. It has been proved that capitalism cannot achieve this. Then I and my hon. Friends claim that common ownership must be tried, and that these things cannot be achieved until common ownership or Socialism is attained in this country. I can only repeat it was with deep regret that I learned that the Amendment tabled in our names was not to be called to-day. My hon. Friend the Member for Barnstaple (Sir R. Acland) stated that it would be very difficult for us to vote against the Motion as at present worded. The decision of Mr. Speaker leaves us with no alternative but to vote against the Motion when the time comes, purely and simply because we do not consider that the aims we seek to achieve can be accomplished by any means other than by the common ownership of the great resources of this nation.
My hon. Friend the Member for Stockport (Sir A. Gridley), speaking with his life-long experience of industry, said on his own behalf and that of the very large interests he represents outside this House and the considerable body of Conservative feeling which he represents inside this House, that he welcomed the White Paper. While asking a few questions to secure further elucidations from the Government he plainly indicated that, so far as he was concerned, he welcomed it and was prepared to do everything he could to make it work. I speak without his experience or knowledge, and I speak only on behalf of a much younger section of the Conservative Party which has on occasions both criticised the Government—when it has not gone far enough—and on other occasions has lent support to the Government in some of those Measures, like the Catering Bill, which did not secure the unanimous support of the party to which we belong, Unlike many people who have spoken to-day, I and my friends welcome this White Paper, as the hon. Gentleman the Member for Stockport does, as the best of all the White Papers that the Government have introduced. Indeed we could really hardly do otherwise. It was immensely gratifying to us to find in how many respects it did adopt, develop and carry very much further certain ideas which we ourselves ventured to put forward in a manifesto which we published some time ago.
To us this White Paper means the end of one chapter and the opening of a new one. It means the end of laissez faire and of the Free Trade century which has now come to an end, and it represents the definite adoption by the Government of a planned economy. The general course which the Debate has taken shows, I think, that just as we, in the proposals we put forward more than a year ago, tried to make an appeal to moderate men in all parties and to moderate men outside all parties, that this Government—which in our view represents moderate and able men of all three parties—has come to similar conclusions with regard to the future which I believe will be found tomorrow, if there is a division, acceptable to the vast majority of this House, and I am sure will also be acceptable to the majority of the country as well.
There are, of course, in all matters of this kind the extremists of all parties, and it was remarkable to notice yesterday that it was the solitary representative of the Communist Party in this House, the hem Member for West Fife (Mr. Gallacher) who challenged hon. Members on this side to reconcile private enterprise with full employment. There was not one of us who was prepared to say that we did not think that full employment and private enterprise could be reconciled, until the hon. Gentleman and my hon. Friend the Member for Hastings (Mr. Hely-Hutchinson) spoke. There, indeed, were the extremists on both sides—the hon. Member for West Fife, who desires to nationalise everything, and my hon. Friend the Member for Hastings, who remains attached to the old principles of the bankers of the nineteenth century, both of whom said that the proposals which have been made by the Government are unworkable. Again, to-day, perhaps in a more political way, we have heard from the hon. Member for Eddisbury (Mr. Loverseed) that it is the intention of his leader and himself and the third of the trinity to divide the House to-morrow on this Motion.
The White Paper which the Government have put forward seeks to introduce method and order into what was the chaos of unregulated competition, without going to the other extreme and trying to put the whole of our national life into the strait waistcoat of Socialism. I believe there can be a flexible framework in which both public and private enterprise can be used in their own appropriate spheres, in' the general interest of the country to provide optimum employment and to raise the standard of living. The problem of unemployment is not one for which there is any one panacea. It is not merely a question of finance or a refusal to adopt Socialism. The hon. Member for Eddisbury made what I thought was a sound point when he said that we ought not to regard this matter solely from the point of view of trying to prevent unemployment. What we desire to bring about, as we suggested in our manifesto, was the full development of resources. As three examples of that we gave, first, full employment, then the development of export trade and then the development of the Empire. I was gratified to-day to find that the hon. Member for Seaham (Mr. Shinwell) also emphasised the vital importance of those things.
Unemployment has generally been divided into two kinds, structural unemployment and cyclical unemployment. Structural unemployment has occurred in distressed areas where certain basic in- dustries have become concentrated and have become depressed owing to the decline in the export trade. I welcome the proposals which the Government have put forward for dealing with that structural unemployment. They have, in the first place, said that they propose to take three great industries, and others which may fall into the same category—coalmining, cotton and shipbuilding—and take all appropriate steps to provide them, so far as possible, with export markets and to ensure their efficiency. The argument of the hon. Member for Seaham was somewhat unreasonable when he criticised the Government for not having dealt with these specific points while in the course of his speech he covered in an equally nebulous way exactly the points which had been dealt with by the Government in general terms.
In the second place, we now have for the first time—and I very much welcome it—the acceptance by the Government of the main recommendation of the Barlow Commission, that there should be an attempt to influence the location of industry in order that in these Depressed Areas, which have in the past been entirely dependent on one basic industry, there should be a greater diversification in order that all the eggs should not be in one basket. It is in our national tradition that while we have been asking the Govment to make a statement as to whether they do or do not accept the recommendations of the Barlow Commission they are now trying to put forward a concrete proposal for dealing with unemployment and include this matter among the many steps they are to take in order to prevent a recurrence of unemployment.
In the third place, I specially welcome what is said about the provision of training in order to enable men who have become unemployed in an industry which is not likely to revive to be given training for a new industry, or another industry in another part of the country. In extending the scope and raising the social and economic status of the trainee, we see the authentic hand of the Minister of Labour. Since he became responsible for the Ministry of Labour the training of hale and sick men has been developed to a remarkable extent, and I am confident that he will see that in the difficult period after the war the same tradition will be carried on. Of course, it follows that if the Govern-
ment are to accept responsibility for employment they must also exercise a considerable measure of control over industry. That calls for certain concessions on the part of both employers and employed. Hon. Members opposite have rather concentrated upon those cases where great combines or cartels have fixed prices and have restricted output, and I welcome what the Government have said in the White Paper about taking the necessary steps to obtain information winch will enable them to exercise the necessary control. We ourselves asked for this sometime ago and said with regard to these combines that
a point does come where an individual firm … obtains a dominance … which it should neither exercise nor desire to exercise without the counsel and the authority of the Government itself.
Therefore we very much welcome the statement of the Government that they are going to take the powers that are necessary. But restricted practices have not been confined to the employers and, when once the fear of unemployment has been banished, it will be only reasonable to ask of the trade unions that those restrictive practices which may have been necessary in order to protect their members against unemployment shall be abandoned and that labour, like capital, shall do all it can to increase the production of wealth in the general interest of the community as a whole
The hon. Member for Walsall (Sir G. Schuster) criticised the White Paper on the ground that it said too little about increasing the efficiency of industry and concentrated too much upon just smoothing out the ups and downs of the trade cycle. I am confident that the Government fully realise the vital importance of increasing the efficiency of industry. Some detailed figures were published in the "Economic Journal" in April, 1943, comparing the production per man in a number of industries in this country, in the United States and in Germany. Obviously we cannot remain satisfied with an organisation of industry in which the British workman only produces a half of what is produced by the American. I am confident that that is no reflection on the British workman. It is rather that there is great need of equipment of our industries on modern lines. We have to face the fact that at the end of the war we shall have a declining labour force. The numbers of
workers available in industry are never again likely to be as great as they were in 1939. It is, therefore, more important than ever that industry shall be so organised and so capitalised that those able bodied men who will bear all the burdens of the extended social services shall be given all the advantages for production which capital and organisation can give them.
I pass from structural unemployment, which has been the chief cause of the Depressed Areas, to cyclical unemployment, which has struck the country on two or three occasions during the last 20 years. I am glad the Government accept the view that this is primarily due to fluctuations in the investment in capital goods. We wrote:
We therefore consider that the Government" must so influence, or if necessary control, the volume and timing of expenditure on capital goods as to ensure an adequate demand for them at any given time.
I am glad to see that for the transitional period immediately after the war the Government propose to take powers to control the timing and the volume of investment in capital goods. But I am cure it cannot be left there. When once this has been instituted it will have to be a permanent feature of our economic system. If once that is abandoned and we allow investment in capital goods to depend on the mood of optimism or pessimism of industrialists, we shall once more get back into these booms and slumps which have been the bane of the past.
I come to the one really obscure part of the White Paper, one which the Chancellor of the Exchequer dealt with without entirely satisfying us. The general argument of the White Paper, as I understand it, is that, since there are a number of factors which make for a certain rhythm in the economic life of the country and which tend to take employment up and down, it is necessary for the Government to take positive steps to try to counteract those ups and downs. When we read the White Paper through carefully and consider it again in the light of what the Chancellor has said, we find that the Government are prepared to use many of the funds which they control, like what has been called the Social Security Budget, in order to increase expenditure in bad times and to reduce Government expenditure in good times, but when we come to the Budget—in one place it is called the Revenue Budget—that is apparently to be treated as sacrosanct. If the principle applies in the case of all the other funds, equally it must apply in the case of the National Budget. While I fully accept what the Chancellor said about the desirability of balancing the Budget over a period of time, I hope that he will be willing deliberately to unbalance the Budget in really bad times in order to stimulate employment. I have a feeling that the Treasury feels that it has gone a very long way, but that it is still so far under the influence of the teachings of Mr. Gladstone and that, while a little irregularity of life in the case of various other funds may be permitted, they must at any rate stick to respectability as far as the Revenue Budget is concerned.
Some hon. Members have complained that the White Paper does not use the expression "full employment." I think there are two answers to that. In the first place, the White Paper is dealing with the methods and controls by which the Government are trying to obtain some measure of control of the volume of employment. It is not dealing with what the amount of employment is to be. I have no doubt that in the future the Government will try to maintain employment at an optimum level. What the optimum level is, is not a thing on which one can be dogmatic at present. It will be a long way below what the present over-employment is, but it is not reasonable to ask of a White Paper which is dealing with the methods of exercising influence and control to lay down finally now what is to be the level at which stability is to be sought. In the second place, until the Government had committed themselves to this, no one had ever suggested that full employment ought to mean that there should be no unemployment. The expression "full employment" really comes from Sir William Beveridge, and presumably the whole idea of the White Paper is to meet his Assumption (c). Sir William Beveridge says:
Assumption C requires not the abolition of unemployment, but the abolition of mass unemployment and of unemployment prolonged year after year for the same individual.
In his estimated budget he works upon the assumption that there will be unemployment amounting to 8½ per cent.
of the total insured population. That surely must be right, because in any flexible and progressive industrial system there must be people who are moving from one job to another. What the White Paper aims at abolishing—and it can be abolished—is the unemployment which is either mass unemployment or the unemployment of an individual over long periods of time.
I have said that I welcome this White Paper. I feel that the Government in writing it have brought themselves into line with advanced economic thinkers. So far as trying to put it into practice is concerned, they have not merely brought themselves into line with advanced thinkers, but they are leading all the nations in the world. Full employment has been known in war time in democracies and in peace time in totalitarian States. This is the first time that any Government have attempted to introduce the conception of organised full employment while maintaining free institutions. I rejoice that it should be this Government who have given the lead. The White Paper contemplates planning in the horizontal or physical sense by the deliberate location of industry. It contemplates planning also in the vertical sense by the use of credit, currency and finance in order to ensure full employment. It does for the first time indicate that the Government are prepared to ensure that finance shall be regarded as the servant and not the master of production. I believe that in the general scheme which the Government have put forward we may reasonably look forward to the full use of our national resources, the full use of our manpower and increased efficiency in our industry in order to maintain a perpetually rising standard of living.
Sandwiched between the hon. Member for The High Peak (Mr. Molson) and the hon. and gallant Member for Stafford (Major Thorneycroft) is the hon. Member for Oxford City (Mr. Hogg). He will forgive me, because he knows I would not be malicious, if I described him as a gay troubadour, who is the leader of a little bunch of young Conservatives, one of whose objects is to pay court to the body of Socialist opinion in this House and who, by his approval of the somewhat ragged speech of the last speaker, would, I presume, have a strong desire to introduce into the new plans which he advocates an admixture of Socialism and capitalism. A long time ago, a fellow at a meeting I attended got up and said that capitalism was like a bad tooth in the head; the longer it remained in, the rottener it became. I am one of those unrepentant people who believe that, no matter how much you endeavour to improve capitalism by illicit associations politically, or by deluding members of alleged advanced parties to believe that there is something in it, you get no result. We must accept that as a sound proposition. There are sound propositions and unsound propositions. If I said that all round things are cheeses, and then pointed to the circular lighting apparatus above, I would be logically right in deducing that it was a cheese.
I only know that when a proposition is propounded and an inference is made therefrom, provided the premise is sound, then the inference should also be sound from a logical point of view. I admit that my proposition is not a sound one, any more than is the proposition of people who say that capital is the result of thrift—"I am a capitalist, ergo I am a thrifty man and thus I incorporate in myself a group of virtues." What we say on our side of the House is that capitalism is the exploitation of the working-class and that if you are a capitalist you must, therefore, be a thief. That is the way we argue. I absolve the right hon. Gentleman the Minister of Labour—who on this occasion is certainly honourable but not right—from any complicity in connection with this White Paper. If he speaks as a Socialist, he would not get my support in perpetrating a White Paper of this description which purports to be a panacea for unemployment, because it is not a panacea.
I hope the House will bear with me if I give a practical illustration of the capitalist mind. A year or two before the war my wife found that the business of which she was the owner, was expanding. She was a girl in the early twenties with a staff of several hundred employees, and being a young lass and not knowing much about the sophisticated ways of this world, she was anxious to keep the staff contented and happy and to do the right thing by them. A bright young man came in one day. He was a salesman for a book which was published by the "Efficiency Magazine," and he told her that if she wanted to solve unemployment and labour troubles, here was a book for her. It was called "Labour Troubles and How to Prevent Them," by N. Casson. The writer was connected with the Tory school of thought. Only recently the Hon. Leonard Cripps, brother of the Minister of Aircraft Production, was one of those who contributed to a certain paper, dealing with the question of that notorious and illuminating book "Your M.P." He tried to explode the fallacies of Socialism in this publication, wherein appears the name of this gentleman, Mr. Casson—so he is evidently quite alive, so far as advocacy of Toryism is concerned.
He says that there are four great fallacies. One is that labour creates all wealth. We say that labour by hand and brain certainly does create all wealth. The second fallacy, he says, is that all profit is theft. We say that that is so. The third fallacy is that the operations of capitalism are opposed to the true interests of labour, and that it is impossible for capital and labour ever to harmonise their implacable differences. We say that there may be adjustments and temporary understandings, as in this war, but that, in the long run, there can never be fusion between capital and labour. The simple reason is that the object of Labour and the object of the Labour Party, as the party of discontent, is to fight the present social system and get as much as it can in the transitional phase, just as contrariwise it is the object of the Conservative Party to get as much as they can from labour by making labour work longer hours for lower wages. Finally, he says the fourth fallacy is that high production is in the interests of the workers. He says that so long as the workers have these four mistakes in their minds, it is as useless to hope for cooperation between labour and capital, as it would be to ask for cooperation between householders and burglars—presumably, he regards the workers as the burglars—and added that those four ideas ought to be discarded because
they are, in fact, silly and suicidal notions which have been put into the minds of workers by slackers and theorists.
He says further:
Labour and capital belong to the same class. They are co-workers. They are partners in production. They must combine against the plundering classes—the bureaucrats—the politicians—the lawyers—the schemers and do nothings of every sort. If I were a dog, for instance, I would not believe in fighting my fellow-dogs. I would try to get all the dogs to combine and fight fleas.
This statement was cancelled by a later one on the subject of how to make discontented workers contented and get better production. He says:
It is the discontentented, neglected worker who suffers most from fatigue. It is not speed that tires—it is lack of loyalty and enthusiasm. Speed is often a stimulant. It is better and less tiring to work fast than to hold back. Imagine a jockey refusing to ride a horse because he was too fast. Imagine a skilled football player refusing to play because the team was speeded up. Such a thing is incredible. Under good conditions and with fair treatment a worker will enjoy being speeded up. It is more enjoyable to be quick than to be slow. Slacking is flat against human nature, if human nature is fairly handled.
I believe in blowing up the opposition with other people's dynamite. I wish to conclude my quotations from this book with this further passage:
Many welfare workers, who ought to know better, are making a speciality of fatigue … This is all arrant nonsense. It helps nobody. It only creates a philosophy of laziness and self-pity. It is nothing but the leisure class trying to justify its idleness. The truth about fatigue is that it is a normal, healthy, helpful, necessary thing, up to a point. There must be fatigue wherever there is work. Tired? Of course, we get tired. Everybody ought to be tired every night. Work causes fatigue and fatigue causes sound sleep and sleep prepares for work and so it goes. That is the cycle of health.
This may sound rather funny, indeed, it is, but the people of this country have worked for a long time on those principles. When we had from 1,000,000 to 3,000,000 unemployed, the idea was to get as much out of the worker as possible, and to pay him as little as possible, with the result that we had persistent periods of unemployment, and I am afraid there is the possibility of those periods returning. In paragraph 5 of the White Paper, it is stated that it is with industry that the responsibility and initiative must rest for making the most of its opportunities to
recover the export markets. So long as the White Paper can say that responsibility rests with private enterprise to recover lost markets, I am prepared to say that we are in for a spell of very considerable disillusionment.
Little has been said in this Debate about the position of India with its 400,000,000 population. The population of India has increased by 50,000,000 in the last decade or so. China has a similar population of over 400,000,000. With Soviet Russia, these constitute half the population of the world. There should be magnificent markets for this country after the war. Let us improve the standard of living of the people of India; but would hon. Gentlemen opposite go out of their way to do so radically instead of offering piecemeal reforms? To improve the standard of living of the Indian worker might be embarrassing to their profits. After the war, we shall have to find people who can afford to purchase the things we have to sell. The only reason why there was unemployment before the war—it can be reduced to a very simple proposition—was that the workers could not afford to buy back the things which they produced. If, in the aggregate, workers by hand and brain produced as much as they could, the march of science has been such that there would be, not merely enough for all, but a surfeit.
Hon. Members opposite are, no doubt, sincere and anxious to build a better world, but I assure them that they cannot do so until the worker is able to receive the full fruits of his productive labours, and until we have a system whereby the production of all commodities comes back to the community, without the intervention of the capitalist, who is only concerned with individual aggrandisement and personal profit. Whatever may be their intentions, I am afraid that any other policy is but relying upon a worm-eaten prop which is supposed to buttress up a tottering building. They cannot expect us to go into the constituencies and say: "Hey presto, we have the answer to all the evils to which flesh is heir." We cannot say that the Government have put their heads together and evolved some marvellous new invention which, for the first time, will solve unemployment.
I am prepared to say that if public opinion could be tested in a fair way in the constituencies in regard to the White Paper, people there would never give assent to a proposal of this description as a cure for unemployment. I submit with great deference to the Members of my party, that it would be a great danger for Labour to ally itself with this White Paper, unless it is made clear that the policy proposed in it is a provisional and a temporary measure, not to be perpetuated after the war. I can come to only one conclusion—that this policy may be a sweetener and a feeler. If we admit that this is a good Paper, and will be as effective as we are told, it follows that there is a case for the present Coalition Government, including the Labour Members, who have evolved this Paper; consequently there is a good case for the continuation of the Coalition Government after the war, in order to implement the policy advanced in the White Paper. To me that would be a suicidal type of reasoning for Labour, because we, as a party, are diametrically opposed to everything, so far as unemployment and methods of alleviating it are concerned, that makes up the outlook of hon. Members opposite.
On the question of investment, are hon. Members opposite prepared to control investment? People invest in businesses, not because of any sincere desire to benefit the workers, except in isolated cases here and there; the chief motive is profit. Before the war, people were concerned in investing in a certain type of industry, not because it produced commodities wanted by the community, but because it would bring better profits. One hon. Member below the Gangway alluded to the Prudential Assurance Company. As hon. Members know, I have been connected with that industry in the capacity of an insurance agent. I was sacked from my job because, it was alleged, I attacked the business capacity of my so-called masters in the Royal Liver Friendly Society. But the Prudential Assurance Co. spent many millions in financing industry in other countries, including coal mines in Poland, which produced coal so, cheap as to undercut the export prices, of our coal. It has been said that
Patriotism is the last refuge of a scoundrel.
But surely patriotism is not merely love of one's country, but something bigger and better—the idea behind every sincere trend of thought, that the workers of the
country are entitled to the very best possible conditions and terms which can be achieved.
Surely that fortifies my contention. If the British Government did ask the Prudential to invest money in Polish coalmines, to finance Polish capital, to employ under-paid Polish workers and thus under-cut the British collier, it was a disgrace to the British Government of the day, and the hon. Member must accept responsibility for supporting it.
Surely, but the fact that the hon. Member was not there does not absolve him from responsibility for supporting the Government. I am very glad that hon. Members opposite are not prepared to support him in furthering that contention. In the past, Governments in this country have been very much concerned about putting workers on the dole. Why not put industrialists on the dole? I would put a certain type of hard-faced capitalist on the dole to-morrow, if he did not fulfil the obligations that a civilised country demands. I do not believe in unrestricted private enterprise, nor that the means by which we live should be controlled by individuals, and I believe that sooner or later the ownership and control of the whole of industry in this country must be invested in the Government of the people of this country. That is quite a different thing from the Government which has acted in recent times.
There is the question of Russia. I do not want to say anything that would, for a single moment, disturb good relations or tend to exacerbate differences between this country and Russia. I hope the good feelings which exist will grow, but I know that a grave measure of responsibility rests upon the shoulders of some of those who were prepared, all too eagerly, to misrepresent actions on the part of Russia in the past. I would say that, so far as the future is concerned, it is absolutely imperative and vital that we in this country should build up a strong endur- ing friendship with Russia, so that mutual trade can be improved. Russia, with a population approaching 200,000,000, may, in 30 or 40 years, have a population of 300,000,000, because they are young and have a high birth rate.
We in this country are faced with two facts so far as the future of employment is concerned. There is the fact that our age groups tend to get higher and higher. There is also the raising of the school-age, first to 15, then 16, and in many cases to 18. That does not mean to say that we need necessarily be worse off. It means that if you educate the young worker, he will produce still more, and he will produce more still if he knows that the ownership and control of industry are vested in him. I would say that unless we are quite frank with ourselves, the outlook after the war will be firstly a temporary period of employment, and after that, as sure as night follows day, and day follows night, there is bound to be a big degree of unemployment unless we can establish with America, but equally important, with Russia, China and India—the great markets of the world—a more cordial relationship. We have to bear in mind that the standard of living of India and China has to be improved.
The Minister of Labour has certainly got a difficult task. I would not wish any words of mine to be misrepresented, but I do say that, within the confines of capitalism, he has done a remarkable thing. He has marshalled 23,000,000 or 24,000,000 workers, with very little complaint, although I know there are inequalities. I would be the first to say that it is a wonderful piece of work. He has been doing a task for the benefit of the community, but only so far as this war is concerned. In the long run, there can be no possibility of any fusion between the Labour and the Conservative Parties in the method of approach to, and the cure of, unemployment. I do not view the future with the same degree of optimism as some of my right hon. Friends. It is easy to be a pessimist, but there is some truth in the saying:
Pray for sunshine, but always be prepared for rain.
As far as the war is concerned, I realise the trade union and political Labour movements have to harmonise many differences with the other side, but ultimately control must be vested in the
Labour Party. [HON. MEMBERS: "In the Labour Party?"] Yes, to a large extent, because the Labour Party is the political expression, and will be so still more in future, of a great number of the workers in this country. [AN HON. MEMBER: "Real totalitarianism."] You can call it anything you like. When the next Election is over, I am perfectly satisfied there will be a material improvement in the numbers of the representatives of the Labour Party. Be that as it may, no compromise on those lines is possible in the long run. I welcome this White Paper as an honest though unfortunate approach to bridging an impossible and impassable gulf.
The hon. Member described the speech of my hon. Friend the Member for The High Peak (Mr. Molson) as ragged. I would not apply that description to his speech. I found it most enjoyable. I was, at least, left with a very clear idea of his attitude to the Conservative Party, and to the Government's White Paper. He describes all capitalists as thieves, and he said that the Government White Paper was a worm-eaten prop. He invited the rest of his party to take the same attitude. Having listened to most of the speeches that have been made in this Debate, from the various sides of the House, I am glad that most Members on that side have not adopted the same attitude to the Government White Paper that the hon. Member has adopted. I think that this White Paper is probably not only the best White Paper the Government have produced, but one of the most important State documents of this century. We had the Beveridge Report, which attracted an immense amount of attention at the time, and rightly so. That was an important document. But, while all of us may be attacked, at one time or another, owing to the accidents of human existence, by insurance problems of that kind, all of us are affected all the time by the Government's employment policy. The Government can congratulate themselves on the wide measure of support that their Paper has had, in the country and in the House. I suppose that I differ from other Members only in that my reservations on the Paper are hardly any at all. If I have any regret about it, it is only that I had not the wit or the imagination to produce something of the sort myself.
There are only two criticisms levelled against the White Paper. The first comes from hon. Members like the hon. Member for Newcastle-under-Lyme (Mr. Mack), who regrets that the White Paper was not itself a blue print for a corporate State. He nods his head. We are bound to get a certain amount of criticism from that quarter. Then there are the criticisms of the hon. Member for Eddisbury (Mr. Loverseed) and the hon. Member for West Fife (Mr. Gallacher). One could almost have said exactly, before the Debate, from what quarters that type of criticism would come. Then you have another type of criticism. It has been rather modestly put forward, but I think it probably exists. You have the type of criticism which says that this White Paper is the first milestone on the road to serfdom. Those who make that criticism fear that the carefully-thought-out and tentative controls envisaged in the White Paper are the first step in the decline, and that, if they concede these, they will automatically be drawn into greater controls, and find themselves in a totalitarian State. Those are the two schools of criticism; but, for my part, I believe that, certainly in this House, and even more certainly in the country, there is a vast and growing body of opinion that recognises that both private enterprise and State enterprise have a wide and ever-increasing part to play in our future affairs.
I always suspect Members who claim to say what the British people want, because none of us can say what the British people want; but may I suggest two things which they certainly do want? To put the first one in the blunt way that they would put it, which is perhaps unparliamentary, they want "to get rid of these damned officials." They want to get rid of the red tape and bureaucracy which have been built up in time of war, and which are constantly touching them in their everyday life.
Every housewife who has to go into a queue, and every person who is held up at every stage of his career and asked to fill up a form. Every person is brought into contact with officialdom at every stage of his life. Let us recognise it, and be absolutely fair, and say that this is a thing which people would like to reduce to a minimum. There is another thing, that is, to get rid of the squalor and misery which go with an unplanned economy. There are the two sides; and, as I see it, the problem with which statesmanship will be faced in the zoth century is to reconcile those two demands of the British people.
There are three aspects only of this White Paper to which I want to make just a passing reference. There is the economic side, there is the human side, and there is the political side. I am going to say very little about the economic side, partly because I always find it difficult to talk sensibly about economics—and I do not mind admitting it, quite frankly. All I would say is that I believe that we could argue for days on the relative importance of private investment and public investment, on the difficulties of diagnosing whether the start of unemployment is cyclical or structural, and that I believe that at the end of it almost everybody's guess would probably be right. I believe that the whole of this White Paper is largely experimental, and that when we set out to use these various weapons in the armoury of the future statesmen of this country some mistakes are going to be made. We are not going to pull the right levers all the time, and in those early days considerable restraint will have to be exercised in the criticism of those men who are in charge of this enormously complex problem.
I want to say something on the human side, because I really believe that the human side of this problem is almost more important than the economic side. This White Paper will, and can, work only if the individual industries, the individual trade unions, and individual men and women are prepared to make it work. That is the fundamental condition of this White Paper. It is not going to be very easy, and I want to say a few words on the position of the trade unions and of big business in this matter. I would say, to start with, that both of them have a great many things in common. Both of them are the subjects of organic growth: that is to say, they started with small beginnings, and they have been built up into these huge organisations which they now represent. Both of them are great vested interests: that is to say, if you cross their paths and they do not like it, you had better watch your step. Both of them have an ideal behind them. Everyone will appreciate the ideal of the trade unions to improve, as they have done over a quarter of a century, the standard of living of their members; but big business, too, has something of an ideal. That ideal has been to bring stability to one area of industry, at any rate, while the whole outside world was being subjected to booms and slumps of unemployment. Both have, in the course of time, adopted restrictive practices.
Trade unions have adopted restrictive practices as to the transfer from one trade to another or the output of a workman. Big business has adopted restrictive practices as to output, in order to maintain prices. Those restrictive practices have, largely speaking, been forced on both trade unions and industry by the instability of our industrial life outside: they were measures of self-defence. So let none of us, at this stage of the proceedings, turn round and blame either the trade unions or big business for all the restrictive practices which they have adopted. In particular, might I say of the trade unions that it is easy enough to say to a trade union leader, "In future you must not press for higher wages, unless they are related to increased output," or "You must abolish your restrictive practices," but it would be unwise and foolish to under-estimate the difficulties that trade union leaders have to face in these matters. I suppose a member of a trade union, like everybody else, expects value for money, and, if he has a trade union leader, he expects him to press for higher wages. I hope, for my own part, that in the years immediately after the war we shall see trade unions playing an increasing part in the efficient running of the industries in which their members work and paying rather less attention to pressing for higher wages.
I would say, in reply to that, that I believe that only one man can be responsible for the day-to-day decisions that have to be made, and that neither shareholders nor labour can possibly be responsible for the day-to-day decisions of a manager. That does not prevent them from being taken fully into consultation regarding the policy of the industry. On both sides we have got to have a change of heart. If big business is going to get into a ring and keep prices up—and one hon. Member gave an admirable example just now of the Steel Federation, a ring that is hampering and crippling our export trade in the case of cars—if that is done on one side, then the object of the White Paper will never be realised and we will never get an expansionist economy on those terms. On the other hand, if the trade unions and the Labour Party restrict the transfer of workers from one industry to another, or say they must lay only so many bricks an hour and cut the building trade down like that, we will never have an expansionist economy that way. It is not all on one side or the other; it is both sides that have to have a change of heart.
I would like to conclude with a few words on the political aspect of the White Paper. I ask myself this question: Can a scheme of this kind, or a policy of this kind, be put through if it is to be debated on a basis of nationalisation against private enterprise? I do not believe it is possible. I do not know what the future development of politics will be in this country. I do not know whether the Government will go to the country as a Coalition or on a party basis, but, if the Labour Party is going to say that socialisation is the answer to our troubles, and the only answer, while the Conservatives say, "We want to abolish all control," and both sides say the White Paper is nothing but a ridiculous compromise, then I am afraid that, in the next 10 or 15 years, we shall have every bit of the squalor and misery we have had before. I believe in the White Paper and in the policy it sets out. I believe there is room for both private enterprise and State enterprise, and I hope that it is on those terms that it will be supported by the House.
We have had a fairly long discussion on this White Paper to-day, and I must say that I have enjoyed most of the speeches I have heard. Efforts have been made on both sides to try to overcome many of the difficulties with which we are faced. I cannot, however, agree that it can be done under the conditions outlined in the White Paper. The Minister of Labour made an excellent speech in opening the Debate, a good propaganda speech, and I thought that, for the time being, he had forgotten that he was not addressing the Trades Union Congress and putting across some of the stuff that he used to do there. I was more than surprised at the extent of the support that he received from the enthusiastic members of the Young Tory Party.
I would like to say that full employment is a misnomer. It is impossible. There never has been full employment since the world began. There was never full employment when there were none of the mechanical machines in use. Therefore, I can visualise that it will be a more difficult matter indeed to secure anything like full employment in these days of private mechanised industry. You can only have full employment if you have full destruction. It has been mentioned that we have only had full employment in our lifetime during periods of war. If you can guarantee total waste, I will 'guarantee total employment. We can provide full employment in a period of mass destruction, when we are producing for the purpose of maintaining armies in the field. The White Paper says there are about 23,000,000 people either engaged in war or providing for war, and the rest of us have been able to live with the same standard of decency and comfort. It is a remarkable accomplishment that, although we have withdrawn 5,000,000 people to the Armed Forces, and the Minister of Labour has directed all the available labour into the factories, still the people of this country have been able to maintain a decent standard of existence, and, indeed, a much more decent standard of existence than they maintained, many times, during the years between the wars.
I would like to ask a few questions in regard to Scotland on this question of employment. We in Scotland suffered more severely, probably, than any part of the country, with the possible exception of South Wales, from mass unemployment after the last war. It was because we depended, to a large extent, upon coal and shipbuilding, and the remarkable thing which strikes me, as I read through this White Paper, is the dependence and reliance placed upon export trade after this war. The experience of the people of this country who depended upon the export trade in the past has not been very happy. Export trades have been classed as the unsheltered industries—the industries most dangerous for people to enter.
In the periods of depression the first districts that were attacked were those that were dependent upon the export trade. We talk now as if we were the only people who are going to look for markets after the war. The White Paper says something about increasing our export trade by 5o per cent, of our exports before the war, when, with other countries competing against us, it brought us ultimately to the position of war. Is America to increase her exports by 50 per cent.? Is France? Is Germany? Perhaps we do not intend to let Germany export anything at all or to trade at all. I remember the slogan during the last war: "No more trade with the bloody Hun," and immediately after the war the financial gangsters of this country were buttressing Germany by means of loans. I notice in the financial Press that they have considerable interest in it. One of the results of the defeat of Germany will be that the holders of Dawes and Young loans will come into their own. Hitler would never pay them, but they expect that when a new Government is established in Germany it will stand by all the liabilities of the German Government.
What is my country of Scotland to do after the war? According to the White Paper the war factories are to be turned into peace factories and, as far as possible, placed on a peace-time basis. If that is so, we in Scotland come very badly out of the deal. We have very few of the wartime factories. The factories were built in England and it was the duty of the Minister of Labour to transfer the workers from Scotland to England to work in those factories. Where do we stand? Scottish export trade was hit largely before the war. We are mentioned with regard to Polish competition. We were told in 1936 by Sir Adam Nimmo that they could not increase the miners' wages because they had to face Polish competition, and that Polish miners were working for only 4s. a day underground and 2s. 10d. a day on the surface. Polish coal was sent to Sardinia and Danzig and we had to enter into competition with the Scandinavian countries. We heard that the British Government were responsible for the Prudential Assurance Company investing funds in Polish mines. Is this the sort of thing we are to visualise after the war, and is Scotland, which suffered severely from unemployment after the last war, again to be faced with this possibility?
I agree that export trade will be necessary but only in the sense as outlined by the hon. Member for Seaham (Mr. Shinwell) as payment for imports. If we are to enter into competition again for markets, it will mean competition for strategic points, trade routes, concessions and it will mean an industrial and economic war that ultimately ends in a military conflagration. I would like to know from the Government if, in their further search for export markets, they intend to do anything for the great Indian market. There are the potentialities of a market which I hope will not be exploited, but if we are to trade with India let us trade on the basis of value for value and not in any sense attempt to exploit it. The expenditure of the Indian people to-day is £5 per head per annum. If that can be doubled or trebled, there will be an export market there that will allow the workers of this country, on a fair and equitable basis, to exchange our commodities, without entering into any external competition with any class of people in the world.
I cannot understand the desire for exports. First, let us explore the home market and see that the people of this country are fed, clothed, housed, educated and have sufficient recreation afforded them, and after we have once exploited that market, and examined and supplied the goods for that market, then, if we have any surplus, let us look for an export market. Do not let us take the commodities that ought to be used by our people for the purpose of attempting to secure a foreign market. I cannot understand how the conditions outlined in this White Paper are going to help us as long as private enterprise is allowed to run loose and as long as we are going to use the machine of production in the interests of private enterprise rather than on behalf of the great masses of the people of our own country.
That the Debate be now adjourned."—[Mr. Drewe.]
Debate to be resumed To-morrow.