COMMERCIAL NOTES

Evening Post, Volume CV, Issue 110, 10 May 1923, Page 4

COMMERCIAL NOTES

SIR E..GEDDES ON TRADE

THE MANDATE FOR ECONOMY

■TAXED OUT OF EXISTENCE.

(FROM OUR OWN CORRESPONDENT.) LONDON, 17th March. As president of the Federation of British Industries, Sir Eric Geddea delivered an important speech on taxation at Birmingham. It was absolutely imperative that taxation should be reduced, for trade was being strangled by the high taxation that took the savings which should provide capital—the life-blood of industry. Asking, "What is the task that we have to perform to get baok to the general level of, prosperity of 1913; what difficulties we have to face; what steps we havo to take?" Sir Eric continued: rrWe talk loosely—and, indeed, it is not only humble people like ourselves, but His Majesty's Ministers talk, as I think, loosely—about returning to 1913 condi^ tions. Can we return to 1913 conditions! The war has not left the world and our part of the world in a poßition to return to the 1913 situation. We have something far more difficult ahead of us than that, and it always pays, and has always been one of the characteristics of our race, to look facts in the face. There are three main reasons why the 1913 basis, as I see it, is inapplicable as an aim for us to-day." (1) The country had now to support an adult male population of 1,300.000 more than had to be supported in 1911, and this took no account of the increasing number of women who, owing to the economic conditions of the country, were able to do the same work as men." There was a net increment in the male population each year of 250,000 boys who reached an adult age and required employment. (2) Provision had to be.made for the payment of £30,000,000 per annum to the United States on account of our debt. This did not mean that they had merely to increase exports by 53.0,----000,000, but that they had to obtain an exports surplus of over £30.000,000 a, | much more formidable task, because to get- an export surplus of £30,000,000 a. ! year it was necessary to increase im- ! ports, and it was only the net figure on j the balance that was of. use. \(3) They ! had to meet inevitably a higher level o"f taxation than obtained in 1913. "During 1922, on the whole, conditions improved throughout the world, but whether this improvement can continue now, and during 1923, with the disturbance and dislocation of trade caused by the occupation of the Ruhr and more of Germany by the French, seems to me to be more than doubtful. This dislocation affects us far more than tne direct trade between cur country and the occupied section of Germany. . It mean.s that Germany injured industrially and economically will j be unable to Tray from other parts of the world, and therefore those other parts of the world will be unable to buy from us. I wish to avoid the dangerous role of prophet, but the more one studies the | trade conditions of the world, the more we are forced to realise that the recruI descence of disturbances in Europe will have effects by no means local but ■worldwide. The first' reason for trade rej covery^-the general improvement of conditions throughout the world—has, unfortunately, now been interrupted by the Ruhr trouble. "Assuming the markets of the world" existed, assuming tranquillity returned to Europe, and Europe regained her purchasing power, how could the country's trade be increased to beyond the 1913 level if there was not the capital essential to the employment of the increased I population? We could only get additional capital by our savings, or by the |. investment of foreign capital in the country. Some of the surplus capital, particularly of America, 'might 'eventually find its way into this country in the form of investments in British undertakings, but.it was,from the savings of the people that we' must look mainly for our capital equipment. To-day many could not meet the tax-collectors' demands out of savings or surplus, and drafts on capi-tal-were frequently made. The country, as I see it, is being taxed out of ezristence." _ The Estimates for the incoming year did not make very encouraging reading, xilmost one-hall of the apparent £100,000,000 saving represented, *r.ot economy, but mere '' cessation of war charges. "As I see it, the trade of the country is being strangled by the high taxation that, takes the savings wliich should provide the capital, the life blood of industry. I have no doubt that there are still fruitful avenues of economy down which the Government should proceed with courage and resolution. If the Government will only take its courage in both hands, I beliave it will find that the country will rally round it, even in that unpopular tack of making specific aav ings," said Sir Eric, in conclusion. GLOW LAMPS OF TRADE. News from some of the leading provincial centres of industry is of a more encouraging nature than was the case a year ago. It is reported that the windows of Coventry motor and cycle works are lit up at night now—the most cheerful sight the citizens have seen lor some years. Night shifts are at worK. One company is turning out 400 motorcycles a week, and wagon, 'loads of "push-bikes" go to the railway station as in the boom days. The number of unemployed has sunk locally from 12,500 a year or so ago to little over 4000, and men; are taken on at the rats of about 600 a month. In Birmingham a- gradual expansion of the mar ket i'or hardware is noticed, both the Home and overseas trade showing more activity, while a large amount of work is in prospect in the engineering industry. In Sheffield the steel industry shows a remarkable advance, and the number of unemployed has fallen from 62,000 in 1921 to 30.C00. One of the leading firms has three and a half times more orders than a year ago. After eighteen months of idleness, blast furnaces near Nottingham have been relighted, and it is recorded from Swansea, that the output of the South Wales steel industry is greater to-day than ever before. It stands at 90 per cent of the total capacity, which was increased by half during the war. Tin-plato exports are 9000 tons up this year, and there is a greatly-increased home trade. Swansea's total output so. far this year has been 1,029,000 tons, compared with 790,000 for the corresponding period last year. Coal has reached pre-war figures. , EMPIRE RESOURCES—UNIVERSITY DEBATE. As the last event of the dying Cambridge term, the Union Society held a debate on the motion: "Thatthis House considers, that the' solution of our economic difficulties must be eought in the restoration of Europe rather than in the development of the resources of the Bri- ;. tiah Empire." In the result the motion was lost by forty votes. The mover held the view that the first need of tho time was to restore Europe, for Europe ! must by proximity and natural needs always be Britain's best customer. In the opinion -of the retiring president, Mr. G. G. Phillips (Trinity), the biggest hope of getting back pre-war prosperity was to stimulate Imperial trade.

This did not imply that the work of restoring Europe was to be neglected, but that new markets must be found for British trade in the interim. Mr. G. H. Shakespeare, M.P. (Emmanuel) "said that Europe was crippled, and, try as you like, you could not increase Empire trade until Europe was drought back a3 a purchaser^ Those who talked about Imperial unity usually had the principles of Imperial preference sticking out of their pockets. Col. L. S. Amery, M.P. (First Lord of the Admiralty) said the real question was. which v/oa the most profitable method of development at the present time. It was an economic question, but yet could not be exclusively separated from politics or defence. It might be true that trade did not directly cement the Empire, but it did ultimately and indirectly. England was a great co-oper-ative institution, which developed its own resources and drew in outside resources to make up our own deficiencies. It was these imports which created employment and which should be considered as well. Eighteen months' ago, in the House of Commons, Mr. Asquith had stated that from the Empire rather than from Germany we were getting just those thingß_ in food and raw material which we required, and which gave employment to our people. It was this Empire trade which was the really nourishing part of .our trade. There could, be no such thing as overproduction in the Empire, but there could be, and was, uneven production. It was astounding to find 50,000.000 people huddled in these little islands, when millions of miles of fine territory were starving for human and money capital to develop them. Here was room for great and rapid and healthy development if only we could get the men, the money, and the markets.