The Dominion. SATURDAY, OCTOBER 4, 1941. GROWING WAR EXPENDITURE

Dominion, Volume 35, Issue 8, 4 October 1941, Page 8

The Dominion. SATURDAY, OCTOBER 4, 1941. GROWING WAR EXPENDITURE

The disclosure by the British Chancellor of the Exchequer (Sir Kingsley Wood) that war expenditure in the past five weeks. touched a new high level of some £13,000,000 a day provides a. reminder o the magnitude of the struggle for liberty and democratic survival in which the whole Empire is engaged. As Sir Kingsley went on to point out, the fact that the figure has reached colossal proportions —and still has a rising tendency—does not of itself give cause for undue anxiety. The organization of Britain on a full war basis Jias proceeded steadily during the year, and though the burden is now greater the national economy —valuably aided by the United States Lease-Lend programme—is improved and fortified. But there, is a potential danger in the situation, and. one which calls for willing and whole-hearted co-operation by the whole of the people. Wherever there is continuous outpouring of money in non-productive directions, coupled with restriction in the output of consumer goods, the elements of inflation are present. . ' . . . f In order to keep inflation within strict limits—for a degree oI it has been unavoidable —the British Government has employed . re sound remedy of tapping heavily and at many different points the swollen flood .of money released by war expenditure, and diverting it back, into the Treasury. In addition it has checked rising prices, and the consequent fall in the value‘of money, by rationing of goods and price control. Further, it has called upon, the people to limit all their requirements proportionate to the continuing shrinkage o industries and manpower for other than non-productive war purposes. The question confronting Britain today is not whether the general policy is right. In the circumstances .there is only one safe and right policy —that of tightening the national belt and checking a needless circulation of money through the community and through one insidious process of inflation after another. . The question is one of degree in applying the policy. The unavoidable trend of war expenditure in Britain is such that the nation may soon confront, the necessity for still heavier application.of the methods now in use. It may be, as the London Daily Mail says, that: . .. . Tighter control bf prices, wages and surplus money is vital to financial health. Everyone must live harder and do with less of everything. And this advice is directed to a people who are already living hard and doing without many of the minor, everyday luxuries of life. The warning and lesson for this Dominion, to be taken from Britain, is that our national commitments in money, material and human power, to meet the demands of war must not be regarded as having reached' their peak, or anywhere near it. We cannot safely assume that the proportion of domestic not-vitally-necessary expenditure indulged in under the present State programme will be possible, within the bounds of economic stability, a year hence, or perhaps even less. Britain is spending today for war purposes an amount equal to nearly six shillings per-person-per-day-for every man, woman and child in the country. We are spending for war purposes little over two shillings per-person-per-day. And instead of husbanding the balance of our daily, weekly or yearly resources for greater inescapable calls, we are spending heavily on maintaining and increasing purely domestic, non-essential State services. In this respect our policy is directly in conflict with the course the Motherland is taking for herself and the example she is setting to the Empire.