AFTER THE LOAN

Otago Daily Times, Issue 26713, 6 March 1948, Page 6

AFTER THE LOAN

Great Britain has made the final withdrawal from the United States Loan. The vast sum of £937,500,000, which was expected to last for three to five years during which time the nation would recover from immediate post-war difficulties and be firmly set on the road to recovery, has been expended in less than twenty months. The difficulties remain unabated, and bankruptcy is a possibility much more real than recovery. The facts of the situation are so serious that the blow may almost be welcomed. If .a severe enough shock can be administered to an apathetic sufferer it sometimes acts as an effective stimulus. The British Government, immersed in its fond hopes of at last creating a Socialist paradise, has concerned itself chiefly with cherished reforms and plans of nationalisation. It has been loath to come to grips with realities and reluctant to associate itself with the enforcement of an austerity which would damage its popularity at the polls. When the' loan was negotiated, its agents too readily accepted the American terms caps in hand. The convertibility and non-discriminatory trade clauses were recognised from the outset as being likely to prejudice British hopes. Similarly, and almost apologetically, the Government has handed out millions of dollars to countries such as Egypt to cancel sterling indebtedness created during the war when it might well have presented a counter charge for services rendered.

And now the loan is exhausted. Only within the last month has the British Government showed signs of facing up to its task. Sir Stafford Cripps gave to the nation the frankest statement of what the crisis meant to the working man, but even that was vitiated by signs of an over-dependence on the early arrival of the emergency dollar payments under the Marshall Plan. Certainly these dollars are essential —it may be serious if they are delayed for even a few weeks —but Great Britain, in the final analysis, must save itself by its own efforts. American dollars should be only a priming for the pump. The only real assets remaining to the nation are, as the Economist contended in a recent article, the political balance, the deep natural unity and the phenomenal staying power of the British people. By reducing the standard of living, by harder work and longer hours, by developing trade in a united Western Europe and by expanding Commonwealth trade, Great Britain can still win through. The first requirement is that the Socialist Government must provide the leadership to resist a menace fully as grave as, though less easily comprehensible, than that which confronted the nation in 1940.