Clause 14. — (Charge of Income Tax for 1949–50.)

Part of Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 23rd June 1949.

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Photo of Mr Robert Boothby Mr Robert Boothby , Aberdeenshire and Kincardineshire Eastern 12:00 am, 23rd June 1949

The hon. Member knows as well as I do that the decision to have a currency reform rescued Germany from the total economic collapse brought about by the policy of this Government.

The hon. Member went on to say that we ought to adopt the policy Keynes advocated in 1931, but he knows as well as I do that conditions today are diametrically opposed to the conditions which prevailed in 1931. If he does not know that, then he ought to. The hon. Member knows that Keynes was then advocating a policy designed to counter an acute world deflation, in which the main problem confronting this country and the world was a glut of commodities due to the lack of purchasing power.

Can it be said that today we are suffering from a glut of commodities? As my hon. Friend the Member for Chippenham (Mr. Eccles) rightly pointed out, if we try to spend our way out of this economic crisis we shall aggravate the crisis of the balance of payments to a point where it will become absolutely unendurable, and which can result only in a drastic cut in our standard of living. The hon. Member knows perfectly well the conditions in 1930–1 were fundamentally different to the conditions which prevail in the world today, when we cannot possibly count, as we could then, on an adequate supply of food and raw materials at very low prices. Then it was possible to spend our way out of the crisis, but now it is not.