Part of the debate – in the House of Commons at 7:56 pm on 5 February 1981.
Until I heard the excellent speech of the hon. Member for Loughborough (Mr. Dorrell) I was about to say that an economist who chanced to hear the debate could be forgiven for believing that, with the notable exception of my right hon. Friend the Member for Battersea, North (Mr. Jay), no one had exhibited an expert knowledge of economics. I must now add the hon. Gentleman's name to this short list. His speech showed an impressive grasp of economics and his shrewd questions require careful answers from his Front Bench. However, if I might criticise his speech, it would be to say that economists tend to take a callous approach. They abandon industries without ensuring that alternative industries are established in order to provide employment for those who lose their jobs. The economists may argue that that is not their task. It is, however, our responsibility as Members of Parliament. It is not good enough simply to allow industries to go to the wall.
Lack of knowledge of such an imprecise discipline as economics is not necessarily a handicap. We are dealing with people and not abstractions, and I make no apology for speaking in the debate as a layman on the subject. The Prime Minister's speech was characterised by an unwarranted optimism, as though she were entirely convinced that her policies would work. No one should be that sure. It does no harm and is perhaps salutary and more natural for ordinary human beings to have some doubts about their infallibility.
My right hon. Friend the Leader of the Opposition exposed the nonsense that the right hon. Lady spoke when she claimed that all our policies over the past 25 years have been wrong. I would go even further. What the right hon. Lady wants is for the country to go back to the late nineteenth century, which was a time par excellence of low wages, high profits, unemployment and the virtual enslavement of the worker. It looks as though the right hon. Lady and her Government are heading in that direction. They are doing immense and perhaps irreparable damage on the way.
I once heard an American comedian debunk the Robin Hood myth. He said that the bandit of Sherwood Forest did not rob the rich and give to the poor, but robbed everybody and kept the lot for himself. He said that a good press agent propagated the myth of Robin Hood's kindness. I think that I dare use the pun and say that the public have been similarly hoodwinked. The modern counterparts of that medieval press agent is Saatchi and Saatchi, which made such a good job of selling the Tory Party to the British public before the 1979 election. It sold that party as having the cure for all our ills.
Everyone now recognises that that was a big con job. In the past 20 months the Conservative Government actions have proved to be the reverse of the Robin Hood myth. They have taken from the poor and given to the rich. We have seen tax handouts being given to the richest in our society. Not a peep has come from the Government Benches about the fact that top earners have awarded themselves 40 per cent. or even greater salary increases. At the same time, workers have been bludgeoned into accepting wage increases that are well below the rate of inflation.
This debate concerns the economy. There can be no doubt that if our economy is not at disaster level it is approaching it. Output is at its lowest since the 1930s. Unemployment—at about 2½ million—is the highest since the 1930s. About 2½ million people and their families are unable to participate in the benefits of the British economy. When the right hon. Lady appeared on the ITV programme on Sunday she showed her iron will. I watched her very carefully. She gave a very impressive performance. When the possibility of an unemployment rate of 3½ million or 4 million was raised, she did not even bat a carefully shadowed eyelid.
Businesses are folding up every day. The bankruptcy rate is unprecedented since the 1930s. It looks like the Wall Street crash all over again. Conservative Members should appreciate that there is widespread disillusionment, even among those whom the Government were supposed to help. I refer not only to small business men but to big business men. The Government have adamantly refused to render the necessary assistance to some of our industries, such as the textile industry, which are vital to our country.
Contrary to the hon. Member for Loughborough, I believe that we should keep some industries going even though the hon. Gentleman may think that we are throwing good money after bad. I refer to industries such as the textile industry, the shoe industry and the fishing industry. Indeed, the hon. Member for Dundee, East (Mr. Wilson) and those of my hon. Friends who represent Scottish constituencies would confirm that. We need some form of selective import control. Like my right hon. and hon. Friends, I am not in favour of holus-bolus import controls. Nor am I in favour of permanent import controls. I think that I know the arguments for and against such controls. I think that I know the answers. It is a balanced argument, but falls in favour of doing something to protect our industries so that they can survive until the time comes to compete on a normal basis.
I should like to quote from Background Paper No. 82, which is available in the Library. I know that the members of the Cambridge economic group are not necessarily economic wizards, but I agree with at least one of their statements. The paper states:
attempts at direct stimulaton of investment, by grants, subsidies, tax relief etc. have not been successful because businessmen are more concerned with the prospects of their markets".
Markets are important. If industry can manufacture the goods, it can sell them, but if 2½ million people are unemployed they will not be able to buy them.
The Government have adopted a deplorably doctrinaire attitude in their slavish devotion and adherence to the EEC, but they know that this country is paying through the nose for the doubtful benefits of membership. As long as the CAP takes up 75 per cent. of the total budget Britain must necessarily lose out on the overall market deal. Another aspect of Government policy requires changing. As other hon. Members have said, interest rates are too high to allow industrialists to borrow. As a result, there is a strong tendency for business men to go out of business.
The over-valuation of sterling has been mentioned. It has been pointed out that the Germans did not allow their currency to be over-valued by anything like the amount that the British currency has been over-valued in the past year or so. In the meantime, our share of world trade continues to fall and the living standards of the British people are not being maintained. It is no longer a question of improving living standards.
Social services are being cut. Many of the benefits of the Welfare State are being eroded. I shudder to think what would happen if we did not have the bonanza of North Sea oil revenues. The situation would be very much worse. I know the implication of my next remarks. The Government are dangerously close to using unemployment as an instrument of economic policy. They have browbeaten the workers into accepting pitifully low increases in their wages on pain of losing their jobs. That is an inhuman policy, which shows a callous disregard for the needs of the majority of our people.
We do not want confrontations with the work force or with the trade unions. We should seek co-operation with the trade unions, the CBI and all those concerned in the economy. The Government say that their way is the only way. They say that the medicine that is being forced on us is necessary, and for our good. The doctors who prescribe that medicine are not properly qualified. They are quacks. The patient may well be at death's door before those quacks are exposed and a proper antidote is administered.