POLICY AFFIRMED

Poverty Bay Herald, Volume LXIV, Issue 19248, 13 February 1937, Page 6

POLICY AFFIRMED

BRITISH ARMS LOANS LONDON PRESS COMMENT SIR S. HO ARE’S' DEFENCE “HOLDING THE BALANCE” (British Official Wireless.) Heal. 2 p.lll. ■ RUGBY, Feb. 12. The bill seeking authorisation for the Treasury to raise capital or use a realised Budget.'surplus for defence expenditure will be presented t,o Parliament without delnv. The necessary money resolution will come before the House of Commons on Wednesday, when there will be full opportunity for a debate. The newspapers point, out that the figure of s'per cent, while it may, in part, be a guide to the probabilities, does not refer to the rate payable to investors, but to the internal Treasury arrangements. Commenting on, the Government’s proposals, 'l'he Times says there is no question of throwing a, new Government loan of £400,000,000 upon the market, nor ilo the signs go to show that such a loan is immediately imminent. Technically. the announcement does little more than create the framework of a highlyorthodox financial operation and to leave the details to be filled in later. It is most, strongly to be hoped that this fresh evidence of British determination and capacity to carry through the defence programme will prove to be constructive in the highest sense of strengthening the efforts simultaneously pursued by the Government to call a halt all over the world to the disastrous policies of putting fists into the mail and piling up expenditure pyramidically, adds The Tiines. The. Morning Post says that borrowing for defence in a time of peace is certainly rare, but so, happily, fife emergencies of the kind with which we are now confronted. The Daily Telegraph welcomes the announcement as aii assurance that the rearmament is being pushed forward with full energy, and says the system chosen is elastic.

The Daily Herald strongly opposes tile Government proposals. It says the loan will place a much greater part of the burden on the working than, for the loan will be inflationary, increasing the monetary demand for all goods and services. Jt 'regrets that the money for defence will not he. raised by taxing the rapidlymounting profits of industry. The Daily -Mail declares that the amount is ' inadequate, and says the Government should have stipulated tor

£1,000,000,0CC at least. T'ho Financial Nows says, there is tftithiftg whatever in the Chancellor's statement, or in the White Paper containing the financial resolution, which' suggests thlil government borrowing on a huge stale is imminent, or to infer that the Government will require funds for the rearmament programme before the auturiiii. . The, News-Chronicle crluCTses the proposals on the ground that the loan will greatly complicate the task of the authorities in keeping expansion within boiinds of reason. . . . Sir Samuel lloare, the *. irst Lord ol the Admiralty, in a speech at (Birmiugliain on rearmameift, Said: ‘The defence programme must inevitably cost scores of millions. We shall find the money as we have found it in past emergencies, and we shall iind it wisely and fairly, holding the balance between all classes of the community and he-, tween sums that can rightly be regarded as capital expenditure and sums that must bo found by annual taxation. “While it is essential that a great part of the expenditro should be paid for in the annual Budget, it is not reasonable that tho deficiencies of many years should lie entirely met ,by tbe taxpayers of the present, year, or years immediately before us. Oil this account, there is every justification for finding a substantial' part of tire expenditure from loans to lie repaid over a term of years. Wo do not like loans of this kind, but in the present circumstances loans are inevitable.

“Wisely are carefully administered, 1 do not believe that it will shake our credit or endanger the supply of cheap money that is so essential to British industry. A strong defence, sound finance, and contented and united people and Empire, are the aims on which t.li'6 Government’s mind is constantly tixod."