Evening Post WEDNESDAY, APRIL 12, 1939. "THE BIG BLACK WOLF"

Evening Post, Volume CXXVII, Issue 85, 12 April 1939, Page 8

Evening Post WEDNESDAY, APRIL 12, 1939. "THE BIG BLACK WOLF"

Speaking lightly at the Labour Conference dance last night Mr. Savage denied that there was any "big black wolf" at the corner, unless it was conjured up by the imagination of people who had lost confidence in themselves. He implied that the big black wolf was merely a creation of Labour's critics. "What a dull life it would be if we had to be content with reading, say, the leading articles in the newspapers," he said. "It is delightful to be able to forget the big black wolf around the corner, the fellow who is waiting for us." Perhaps this facetious way of meeting difficulties will have some success, but we scarcely think so. Walt Disney has,woven the fable of the big bad wolf into his "Silly Symphonies," but we doubt if even supporters of the Labour Party are ready- to accept "Silly Symphonies" as political truths. It may be that this is all they are to be given—a joke instead of facts. Certainly it is all that the public have had so far. There has been no serious explanation by the Government for the people at large of the financial policy to be followed in the present very serious position. The attempt to dismiss the crisis as a creation of the newspapers will not carry conviction. It does not agree with the known facts —the loss of sterling funds, the imposition of sterling control and import restrictions, the increasing weight of commitments, the disheartening prospect of heavier taxation, and the hints given by the Minister of Education and the Minister of Labour that the lavish spending indulged in by Labour may have to be curtailed. It is contradicted also by Mr. Savage's own statements to the Federation of Labour that the Government's difficulties were beginning and not ending, and to the Labour Party Conference that "now that export prices have 'receded, particularly in wool, the true test of Labour's policy is at hand." If Mr. Savage knows "that things are all right," what difficulties are "beginning and not ending"? And if there is no big black wolf why not allow the public to have a clear view of what is around the financial corner? The Prime Minister may have complete confidence in the public, but the Minister of Finance does not appear ready to take the people into his confidence. To suggest that the difficulties ahead are merely a big black wolf conjured up by the newspapers is an old device. The newspapers have i only presented facts and asked for the Government's policy. The facts have not been proved erroneous— indeed they cannot be—and the policy has not been disclosed. Time and again we have pointed to the evidence of approaching trouble, the diminishing resources, and the growing commitments, and asked what provision the Government had made. There has been no scaremongering, but an effort to induce the Government to remedy a deteriorating situation before it be-, came too difficult for correction by moderate measures. The Government disregarded these warnings in relation to the loss of sterling funds until the position became so critical that drastic control was inevitable. Is it now repeating this method with the internal financial situation, hesitating and delaying action till correction by reasonable economies is no longer possible? If so it is playing into the hands of the extremists of the party who seek an excuse for further resort to inflation that will react disastrously upon the thrifty and industrious section of the community. The evidence certainly suggests that, in spite of assurances that Labour is more united than ever, differences have arisen which hinder the formulation and application of a definite financial policy. We mentioned yesterday the lack of. all information concerning the proposed internal loan, though the intention to raise such a loan was announced four months ago. It was commonly i reported when the Government issued its previous conversion and new money loan in 1937 that the terms did not have the wholehearted approval of the party. Mr. J. A. Lee, Under-Secretary to the Minister of Finance, stated in his pamphlet "Money Power for the People" the objections that some members held to the offer of even the low rates of interest then decided. Some members would have preferred to see the rate lower; so low, indeed, that the loan would have fallen back on the Reserve Bank for redemption by the \ issue of credit,

A considerable number of people would hope (wrote Mr. Lee), to quote one Labour member, "that not half a crown is subscribed." Certainly I want to see the new powers utilised to the maximum. Personally, I should like to see every conversion on a new loan underwritten at a rate too low for Capitalist subscription.

Has this difference emerged again and made it difficult for the Government to find a policy which will not offend the credit-users on the one hand or cause a failure of the loan issue on the other? Whether this be the explanation or not, the present dilly-dallying while the position becomes daily more serious, and the failure to expound a clear and firm policy to the public, are certainly not means by which thinking people can be persuaded to treat the coming of a crisis as a joke.