Evening Post. THURSDAY, NOVEMBER 19, 1931. THE BALANCE OF TRADE

Evening Post, Volume CXII, Issue 122, 19 November 1931, Page 12

Evening Post. THURSDAY, NOVEMBER 19, 1931. THE BALANCE OF TRADE

The universal belief that the National Government had more to fear from its friends than from its enemies has been abundantly confirmed during the first week of the session. We have heard very little of an Opposition which, even if the Independents are included, represents <anly 10 per cent, of the House of Commons, but the freedom to annoy the Government which the security of a nine-tenths majority confers upon its supporters has been liberally used. The most conspicuous incident was the foolish attack upon a Liberal member of the Government in which Sir Austen Chamberlain made a most unfortunate debut in the dual role of free lance and elder statesman. But in spite of the natural indignation of the Liberals, the calm and dignified retort made by Sir Herbert Samuel outside of the House has minimised the mischief and averted what, if Mr. Lloyd George had been in his place, might have developed into a first-class Parliamentary scene. It was presumably the tariff question that was in Sir Austen Chamberlain's mind when he protested against any "hole-and-corner meetings" of Liberal leaders. It is, undoubtedly the tariff question that has inspired the endeavours of General Page Croft, Mr. Amery, and other ardent Protectionists to hustle the Government into a "whole hog" programme, and even to find some sinister intention underlying the admirable idea of Mr. Thomas's Imperial mission. There would be something to be said even for "hole-and-corner meetings" if they would secure for a good deal of this precipitate and unjust criticism the privacy that it deserves. The British Government seem to us to have been equally wise in refusing to be hurried with the broadest, most difficult and most delicate part of their fiscal task, and in the promptitude with which they have tackled the simplest and most urgent part of it. They are entitled to further congratulations on their choice of one of the strongest Freetraders in the country to take charge of this part of the programme. If Sir Philip Cunliffe-Lister, who was President of the Board of Trade in the first National Government, had retained the same position in the second, he would have carried no more weight as the Minister in charge of an antidumping Bill than any other Conservative Protectionist of equal standing and ability. But to put a Liberal in charge of this measure, and such a Liberal as Mr. Walter Runciman, who may be classed with Sir Herbert Samuel and Lord Grey among the foremost advocates of Free Trade, was the best possible way of appealing to the considerable section of the Liberals which still clings to the old faith and of meeting the taunt that this is a Conservative and Protectionist Government with nothing national about it but the name. The speech which Mr. Runciman delivered on the 10th September during the debate on Mr. Snowden's Supplementary Budget received a very high compliment from the first National Government, as we were informed by a Press Association message dispatched on the following day:— The Government has appointed a Committee of three experts immediately to examine a suggestion of the prohibition of luxury imports made in last night's debate by Mr. "Walter Runciman, Liberal ex-Minister. But oddly enough, though the "Daily Express" forecast of this suggestion had been cabled, the speech itself was not reported. Yet as a confession of an unrepentant Freetrader's faith in at any rate temporary Protection the speech was of even greater interest and importance than the suggestion which the Government adopted, as the following extract will show:— I have been a Freetrader all my life, and lam still a Freetrader. I am not sure that I am not the most bigoted Freetrader in the House, but I am not so much a Freetrader as to shut my eyes to tho terrible risks we are running at tho present timo in a failure to balance our trade budget. There is nothing unusual therefore in going to extremes. May I say to hon. gentlemen who sit behind me, I do not think that they are going to get over this trouble with a tariff. If you are going to balance your trade budget, absolutely prohibit the importation of those luxuries, as you did in war time. You have the list to work on. The wartime list will do for many purposes. You may have to revise it. You will have to examine it with very great care. You will have to see that an honest man is put at the head of the licensing department, but the thing is far better worth doing than any attempt to peg the exchanges. My suggestion to the Government to-day is, that they should at once set on xoot any inquiry by means of which they can exclude from this country luxuries purchased from abroad. In suggesting the total prohibition of luxury imports "as you did in War time" Mr. Runciman's modesty conceals the fact that he had any concern wilh the transaction except

as a looker-on. But this war-lime prohibition was actually his own work. work. When Mr. John Burns resigned at the beginning of the War Mr. Asquith put Mr. Runciman in charge of the Board of Trade in his place, and it was in [hat capacity that in 1916 he proposed and carried the. policy which he asked the late Government to imitate. Mr. Runciman pointed out in the same speech that the purchasers of luxuries had not abated since the prosperous days of 1920-21, and that the expenditure was not restricted to any one class. At the date of this speech it was estimated that the adverse trade balance was £75,000,000, and that £20,000,000 of it would be accounted for by this one measure. Neither of these estimates was brought up to date in Mr. Runciman's statement of the Government's proposals as reported on Tuesday. These proposals extend far beyond the modest limits which he proposed in September and apply, as we were told yesterday, to the whole range of manufactured and mainly manufactured imports, including Part 111. of the Board of Trade monthly return, representing between £200,000,000 and £300,000,000 worth of imports annually. During the present year the value of these imports to the end of October was £215,000,000. The rapid rate at which these figures had recently increased in anticipation of possible changes in the duties had been explained by Mr. Runciman in his statement. Two years ago, when trade was active, the imports in question amounted to £28,000,000 a month. During the first ten days of November the rate had increased to £35,000,000 a month—an advance of 25 per cent. The sound sense Avith which Mr. Runciman explained both the urgency and the limitations of his measure are well calculated to inspire confidence. The Government had, he said, .to deal with each problem as it arose practically and without preconceptions. To maintain the currency they must prevent the adverse trade balance from increasing. The only permanent way of restoring the trade balance was by expanding exports rather than by curtailing imports, but the two things were not incompatible, and he hoped that British purchasing capacity abroad would be reserved for essentials. To allow goods to be imported in the present abnormal quantities would defeat the ends of the Chancellor of the Exchequer, if he were later to impose duties. Though, as expounded by this eminently unfanatical Freetrader, the Bill which is being put through all its stages to-day is a currency measure rather than a protective measure, and though it imposes no duties, but leaves the impositions of duties not exceeding 100 per cent, to the discretion of the Board of Trade, it has been cordially welcomed by the Conservative Press and seems to have received substantially unanimous approval. We are actually told that "the speech satisfied even the critical General Page Croft, who said that it was evident that Cabinet was impressed by the urgency of the problem." This is indeed praise from Sir Hubert. The introduction by a Free Trade Minister of a tariff Bill which so fierce a Protectionist can approve is a feather in the cap of the National Government.