I was very interested in the remarks of the hon. Member for South Bristol (Mr. Wilkins) on the subject of the increase in the Tobacco Duty, and it appeared to me that what he was really attempting to do was to shift the burden, or part of it, from his own constituency, where they manufacture tobacco, on to the constituencies of certain other hon. Members, perhaps particularly that of the hon. Member for King's Norton (Mr. Blackburn), where I believe they manufacture sweets on a very large scale. I do not know whether that would meet with the approval of the other hon. Members concerned. I do not really know whether the system that he suggested would be practicable or not. I do not know whether it could be easily administered. But I have seen it stated that any direct attempt to restrict the sale of tobacco would lead to the establishment of a large black market and, as the hon. Member knows, a black market always favours people who have got money at the expense of those who have not. I rather doubt, therefore, whether the system he suggested would be preferable to the straight increase in the duty which the Chancellor has proposed.
Now I would like to make a few comments on one or two of the issues raised by the Budget. First, I am bound to say that I welcome wholeheartedly the Chancellor's assurance that we intend to stand absolutely firm against the peril of a return to a policy of deflation, which has had such disastrous consequences in the past, and would undoubtedly have disastrous consequences again in the future. I agree with my right hon. Friend the Member for the Scottish Universities (Sir J. Anderson) that what we have to do is to avoid the twin evils of run-away inflation and uncontrolled deflation. What we require, of course, is the greatest possible measure of stability at a high level of activity, with probably a slight inflationary trend, which we are almost certain to get under such conditions as the hon. Member fox Smethwick (Mr. Gordon-Walker) described yesterday. If I were compelled to choose, I would rather have to deal with the problem of preventing a run-away inflation than with that of arresting an uncontrolled deflation, because on the whole I believe that our technique of dealing with a potential inflationary situation is somewhat more advanced and efficient than anything we have so far evolved for dealing with the results of deflation once that policy has really got under way.
A word or two about the cheap money policy, which has already been thoroughly raked over by a number of other speakers. Up to recently, when the prices of gilt-edged securities have been steadily rising for a long period, the Chancellor claimed that fact as a measure of the confidence felt in the Government by the investing public, or by that section of the public who put their money into Government securities, and a measure also of the high standing of the Government's credit generally. He rather tended to ignore, or skate lightly over, those factors which created an artificial market in gilt-edged securities, as the hon. Member for Chip penham (Mr. Eccles) pointed out yesterday. The fall in the prices of gilt-edged securities consequent on the fuel crisis must, I think, have come as rather a rude shock to the Chancellor, indicating as it did a reversal or semi-reversal of public sentiment in that respect. Whatever he may say about the small volume of selling and the reluctance of jobbers to take stock on to their books, and so on, it cannot be denied that the fall did indicate that such confidence as is felt in the Government is built on somewhat flimsy and shaky foundations, which are liable to be undermined or swept away by a comparatively mild wave of adversity.
By and large, however, it must be confessed that the Chancellor has, during the last 18 months or so, won great victories over the rentiers with, on the whole, great benefit to the national economy. It seems to me that this whole operation may very well be likened to a battle. In that battle the Chancellor has made sweeping gains and has driven the rentiers back into a small corner of the field. This, however, is a very peculiar sort of battle, because the consummation of the Chancellor's victory, and therefore the ultimate success of his whole policy, depends not on exterminating the enemy but rather on keeping him in existence. In fact, he must keep him in existence, because if he presses his adversary too hard, so that he either ceases to save at all or indulges in an orgy of gambling and speculation, in order to obtain higher yields or to live on capital appreciation, well then, while appearing to have won the battle the Chancellor will unquestionably have lost the war, because a wave of uncontrolled inflation will set in which his whole policy will crash in ruins.
Therefore, I would submit that everything in this cheap money policy depends at the present time on knowing just where to stop and consolidate the ground which has been gained. The Chancellor reminds me very much of the man who had a horse, and who in order to save money gave it a little bit less to eat every day in order to see how little it could live on. He was eventually compelled to confess sorrowfully to a friend that he had just got it down to nothing at all, when it died.