THE NEW REIGN IN BRITAIN

Press, Volume LXXII, Issue 21733, 16 March 1936, Page 12

THE NEW REIGN IN BRITAIN

ITS HOPEFUL OPENING [By HARTLEY WITHERS.] Our new ruler of the British Empire I starts his reign, as far as domestic and Imperial affairs are concerned, under # thd happiest auspices. The testimonies paid, by opinion in all the important countries of the world, .and echoed still more earnestly by his subjects, to the character and devotion to duty of the late King George have given the British throne added prestige. His successor has promised to follow in his father’s footsteps; and, with youth in his favour and experience gained during a long and hardworking apprenticeship, there is every reason to feel confident that he will worthily fulfil this promise. He has shown the keenest interest in the social condition of his people, and also in problems of domestic, Imperial and foreign trade; and there can be no doubt that his influence will be strong on the side of industrial and political peace and goodwill, at home and abroad. -In the last few years of King George’s reign, revolutionary changes, as our readers know, happened in the political and economic arrangements of Britain. Under the stress of the crisis of 1931, party Government was suspended in favour of a National Administration, believed by its supporters, and by the great majority, of those woo organise business, to represent the best and steadiest Elements in all the existing parties. The policy of free trade, that had' been maintained, in spite of growing tariffs abroad, for the best part of a century, was abandoned in favour of stiff protection. Finally, Britain was forced by foreign panic, and after a struggle in which she exhausted her gold resources, off the gold standard which had been the ark of the covenant of her financial policy. Confidence Increased These economic. changes, as to the practical effects of which discussion will probably never cease, undoubtedly had the effect of increasing the confidence of British industrialists, already cheered by the political change. After long feeling that they* had little fair chance of earning profits, with markets abroad closed to~ them by tariffs and other trade barriers, and with their home market wide open as the dumping ground of the world, both the adoption of protection and the depreciation of the pound, which assisted and increased its effect, gave them at last the belief that the dice were no longer loaded against them. And, since the beliefs and hopes of the business organisers are by far the most important influence on the activity of business, British recovery made its appearance in 1932, and has gone steadily on, with scarcely any appreciable setback, since that time. This recovery, however, has been only partial; since there are still, in spite of considerable reduction in unemployment, nearly 2,000.000 on the register as unemployed, and depression in certain areas and industries is very far from having been overcome. In a country which is still the chief trading nation of the world, such gaps in recovery are obviously inevitable as long as foreign trade is hampered by all the manifold restrictions on it that are prevalent to-day. All the more credit, we may fairly claim, for British enterprise in general to be able, during 1935, to raise its volume of activity, as measured by an index composed by the “Economist,” to a point slightly aboye the level reached in 1929. the last year before economic nationalism began to produce its deadliest effect in- strangling international trade.

Gap in Recoverr-

On the other hand, the critics of recent British policy can argue that this continue# gap in recovery shows how wrong the Government has been in joining In that inharmonious protectionist concert which has drowned the voices of those. who wish, to see international trade restored; and these critics contend that British recoery cannot go much further, or even maintain its recent success, until relaxation ot trade restrictions, and stabilisation of the pound, and the reopening of the international capital market, havp helped to revive the flow of trade across the frontiers.

British industrialists, however, can find plenty of reason for confidence in the continued activity of the home market. The National Government has obtained a new lease of power and has adopted a bolder policy. The profits of the last years and the wide-spread prosperity of all classes —even the unemployed are now better off than many of the workers of a generation or two ago—are putting an abundant revenue into the Government’s hands, and it has achieved a handsome saving by debt conversion. This revenue and saving -it proposes to use by an extended programme of expenditure, in repairing its defence forces, road improvement, simp clearance, and other efforts for the improvement of the country’s health and education, all of which will help to keep industry busy 3nd profitable, and so provide more revenue for further effort, if required. This characteristically British form of “new deal.” with no fireworks, no unbalanced budget, but revenue and expenditure helping one another, may be continued for years, barring external accidents. Overseas Trade There is also good reason to hope that overseas trade may imnrove on the faint signs of revival that it has already succeeded in showing. The rise in the prices of wheat, wool, gold, copper, and other commodities and metals, has put fresh buying-power into the pockets of many countries in and beyond the British Empire, that were lately reduced to the verge of ruin by the fall in the values of their staple exports. If, in addition to all these hopeful signs of economic improvement, international, politics can be induced to assume a more peaceful complexion, and if a real peace and co-operation can introduce international goodwill in the place of suspicion and quarrelling among the nations, the reign of the new King in Britain may be marked by the return, on a greatly extended scale, of the prosperity that meant a notable, thci’gh still insufficient, advance in the standard of comfort of all the chief civilised countries of the world, during the century before the war.