Orders of the Day — Economic Situation

Part of the debate – in the House of Commons at 12:00 am on 11th March 1947.

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Photo of Mr David Eccles Mr David Eccles , Chippenham 12:00 am, 11th March 1947

I have not time, but the hon. Gentleman knows that there are many such practices. They are referred to in the White Paper and it is common ground. I am asking: is the choice in escapable between a return to the free play of prices or totalitarian Communism? Very significantly, much the same answer to that question was given yester day by both the President of the Board of Trade and the right hon. Member for Aldershot (Mr. Lyttelton). Both said that democratic planning is possible. The methods which these right hon. Gentle men proposed were more remarkable for their points of agreement than for their points of disagreement. But will they work in practice? The essential feature of the President's plan was co-operation between both sides of industry and the Government. He rejected compulsion; so does my right hon. Friend. The President said that he would revive the Joint Production Staff; that was invented by my right hon. Friend during the war. As his servant I attended its meetings. My right hon. Friend said he would confine planning to strategic decisions and in various ways he would delegate the carrying out of those decisions to industry itself. I am certain that the President of the Board of Trade would be glad to do the same thing, if he knew how to do it.

It is easy on paper to draw up a scheme of democratic planning, but is it practicable, in the economic and political conditions which exist? That is the real question which the House has to answer. My answer as a technician is that, in terms of economics, it could be done. My answer as a Member of Parliament is that, in terms of politics, it cannot be done. As long as the ultimate aim of one of the great parties in the State is to socialise all the means of production and exchange, for them to ask for voluntary co-operation between the hangman and his victims does not make sense. Nationalisation is a policy which is bound to split the country into two, and we feel that our half is growing. On the other hand, if we on this side of the House were to aim at a return, when the shortages have disappeared, to a completely unplanned economy, I think that the proposals of my right hon. Friend would not work and that it would then be our turn not to have co-operation. We could not have the co operation of labour in those circumstances.

In my judgment, the conclusion is quite clear. Democratic planning—that was the essence of the proposal of the President of the Board of Trade—has little chance of success while the electorate is equally divided by great differences of political principle. If that planning is to succeed, the Conservative Party for its part must convince itself and the nation that it knows how to prevent a return to an over - privileged and under - employed society, and the Labour Party must abandon Socialism. Those are the hard facts of democratic planning. The President of the Board of Trade said yesterday, and he was quite right, that no temporary solution to this economic crisis is possible. No short revival of the Dunkirk spirit will avail. I believe that we need something of an economic revolution. We have to find the principle on which we can make a radical change in the balance and methods of our industry and agriculture, and that is a long-term business. If I turned that idea into political words, I would say to hon. Gentlemen opposite that we shall have to meet in the middle or we shall diverge in disaster. So much for the politics of democratic planning.

I turn now to the technique, of which I have had some slight experience. I am surprised continually at the poor show the Labour Party have made of planning. I frankly admit that I thought they would do much better. The fuel muddle is only one out of many examples. I believe that within a few months the Ministries of Food and of Agriculture will be seen to be just as incompetent as the Ministry of Fuel and Power. This is not an accident. There must be behind that incompetence some underlying weakness, and I want to offer to the House, for what it is worth, a technical explanation—not a political explanation. I am sure that an immense amount of harm has been done by the confusion between planning and controls. Planning. and controls in this country are irreconcilable enemies. The better the plan the fewer the controls; the more the con trols the Less flexibility we have in our economy, and without that flexibility it is not possible for a British Government to plan for abundance. What fools we are to have taken our notion of planning from Continental economists who have never been able to understand the limitations set to the British policy by our love of individual rights and liberties.