THE NEW DEAL

Evening Post, Volume CXIX, Issue 104, 4 May 1935, Page 6

THE NEW DEAL

LORD SNOWDEN'S BLESSING

"FINANCIALLY SOUND"

£■ Lord Snowden has emerged from to give his blessing to the "New Deal" of Mr. Lloyd George. - In a sixpenny pamphlet he pronounces

it to'be "financially sound," states the

..*\Daily Telegraph." f "What weight that will carry with *the' Cabinet Committee which is now

* examining the plan remains to be '.seen. Lord Snowden himself is not "I shall await the out- * come," he says, "but without much - hope." ', As he' aiimits., there is little in the ~ scheme that, is new. So far as bold ■^expenditure on public works is concerned, it is the same programme as ;• before. " • ' The Jdea—also not new, but less well .tonqwn than the other—o'fia National '^Investment and Development Board, ; combined with a Special Department -^ot the Cabinet to carry their schemes reorganisation into effect—which 'Mr. Lloyd George urges as an im•"'mediate necessity Lord Snowden puts ."'into cold storage.

',; -C "There is not much likelihood," he "that these practical sugges'i tions will be adopted just yet." They " concern .long-term policy; he is more ' concerned with short-term policy—in pother words, with a vast programme ■> 01 wcpejlcuture on works of public trahty designed both to provide work Jot fhe unemployed and also to add to \the. national well-being. vC\ REBUILDING ENGLAND. * * ■ He sets no limit to what might be' X undertaken. "In fact," he says, "the part of England needs to be. ~ rebuilt." If England, then presumably '...Scotland and Wales as well. They, \ -would certainly v not desire to. be I omitted from the golden rain. i ;„' .Such is-the mood in which Lord Snowtfen approaches the problem. In- . .stead. ,of destroying and replacing J2SQ,QOa slum tenements, the Govern- , ment should have dealt with a million. '. Jt is as if the Pharaoh, when told that G^eat Pyramid was finished, had 3. brusquely said, "Then build six more!" *„ only ■hope is that the State will ti U deliberately direct-the dormant savings £, into necessary and remunerative pubgc works. !,'' -"The State pan now reap the benefit &of the cheap' money which private ! trade cannot or will not use. Money s can be got at under 3 per cent, instead -', of at 5./ per cent four years ago. A v-3oan of £400,000,Q00 would cost the , l Budget-£12,000,000 a year less in in- ,; terest charges—far less than, is now ,; Being thrown away on .State subsidies in a futile effort to revive certain , industries." ' ~ ' It is. characteristic that Lord Snowt ,.den does not particularise. The most cballengable and the most, challenged ■t" Ofi aU tne'existing subsidies is his own ,j\^-that on beet sugar. ' \? '■> Then he goes on to say: "Personally .;:X have no doubt that for a number of V~ years to come a, sum' of at least i^ £200,000,000 annually 'could be raised : -_ by the State without encroaching on f' the capital required for industrial pupposes. Money is likely to remain ;'^ cheap until there is a real expansion *» °* ft&fe' Cheap money is the opportunity tor State borrowing. There ■ f woujd be no increase of taxation. The *,intere!st will be met out of an expand- "- ing revenue apart from the great' . saving in 'subsidised idleness.' " ■ ;" i-;Tbifl }S told prophecy. But the gen- . AraJt'exfeerience is that whenever poli-| T. ticians promise "no increase of taxa- ,; .tioa" the taxed invariably increase.

,' '* CRITIC OF THE GOVERNMENT. :,;_ -The author warmly repudiates the ■ .Charge of encouraging extravagant expenditure. Yet, when he was in office, if he did not encourage it, he ~ acquiesced in it, salving his conscience ~by,«n occasional warning which, his ' Socialist followers derided. • ' l|is'' charge here against the National :'Government; which, in his view, has ' v done no good since he left it, is that by % "refusing to'recognise that conditions * ''have changed in, the last three years, - ajnd'by adhering to a-polic^ of national u"eeoi»bmy, now become unnecessary, the £" Government have retarded trade re- /■■ covery," ' '

- "Very likely they might have exP landed their public works expendi- '' tinre by 10 or even 20 per cent, with- ; out much > hurt, but that is not to say that they could have expanded it by *- 50, 60, or 80 per cent, with advantage. \l''&U& Snowden very wisely does not r define/ closely what he means by '""n'ecessary and remunerative expendi- "> ture.1' '~'Building schemes," roads, abridges, drainage, land reclamation— ' ,- -fit is the same old catalogue. But the "©ld" obstacles still strew the path. ~ Millions might be spent on building f Without putting a single cotton opera*t 4ive into employment, though those - fortunate .enough to be already in em- • pldyment might earn rather better v- fconey. '/• Every third-class road in the country '-trnjghVbe transformed into a secondary ■ and given a perfect motoring surface. '«But it would be absurd to call either a the work necessary or the results '■ Remunerative.

, - Lord Snowmen is very contemptuous Ajßf business men who are "still timid about the prospects of trade." But their timidity would be violently accenif his old associates were back' 'r pt office and spending freely. i 1 'He'has no words to describe the I "inefficiency of British industrialists t""Who clamour for tariffs as "crutches" whereby they may "toddle" lazily and - comfortably along. He demands lowv ■ ered costs of production, but never • Jnentions comparative rates of wages ' »ndJ hours of work. ,i .Nor does he show how an unsub- ' Eidised British industry can compete against a subsidised foreign rival selling here fat below cost ' price in the ,' place of origin. Perhaps, fortunately lor himself. Lord Snowden has never v l>een in business: else he might have fared often as disastrously as Mr. ' ■ JCobden.

, ] '' .TRIBUTE TO, THE BANKS. _~. - In general Lor,d Snowden flashes his ,;-.»\pord upon the National Government. -Butoccasionally he has a fling at his ;-Old comrades. On the Labour Party's : policy of-the Nationalisation of the /Banks and the public control of credit " he caustically observes: «-," "If the banks we're-nationalised they r s would have to be managed, as they are j. now if their solvency was" to be main- " tamed. That, however, is clearly not • the intention of the Labour Party, -as expressed by the most garrulous ex- § ponent of its policy." %l Again he says: "The British, banking v system is the envy and admiration of .the world* Through all the world f- .chaos of the war and the aftermath while, in other countries banks have been crashing, the British banks have stood firm as a rock ,and the depositors have never had a moment's anxiety , about the safety of their money." » It is by no' means the first time that \ Lord Snowden has given the banks a glowing" testimonial. He even mildly .' reproaches Mr. Lloyd George for sug- ( ; gesting that the directorate of the i Bank of England might be improved *»' if its basis were still further broadened. \; "The representative character of the -„', board might be widened, as Mr. Lloyd if-'Qeorge suggests, by introducing a ~' .democratic element. But, frankly, I do t -not believe this would make an-atom of difference in the actual managejaent of the bank."