The Timaru Herald SATURDAY, MAY 19, 1934. FRANCE’S CHANGING POLICY.

Timaru Herald, Volume CXXXVII, Issue 19803, 19 May 1934, Page 8

The Timaru Herald SATURDAY, MAY 19, 1934. FRANCE’S CHANGING POLICY.

Something of a shock will be experienced in the chancelleries of Europe when they read the announcement coining from London newspaper sources that the money France saves, by the economy cuts, with other millions totalling in all fifty millions sterling, will be expended in strengthening the national defences. Such a statement is scarcely credible, in view of the almost hopeless position into which the national finances have drifted during the succession of political crises which have resulted in the rise and fall of several Cabinets. It is interesting to recall, however, that it was on March 30, after a Cabinet Council held at the Elysee, that the announcement was made that Cabinet had definitely approved of measures of economy which were submitted to them. These measures, it was understood at the time, were the first of a series of degrees aiming at restoring financial equilibrium, and give a balance to the national budget. The measures were as follows: (1) A reduction of 10 per cent, in the number of civil servants. Estimated yield: 750,000,000 f. (2) A reduction of 5 per cent, to 10 per cent, in official salaries without exemptions. Estimated yield: 675.000,000 f. (3) A reform of pensions, with the abolition of overlapping benefits. Estimated yield: 700,000,000 f. (4) Cuts in Departmental estimates, one-half applicable to the Defence Ministries, the other half to the Civil Ministries. Estimated yield: 7700,000,000 f. Total estimated economies are: 2,285,000,0001.

Leading experts have estimated that the deficit on this year's Budget is 4,000,000,000 francs, and that it will therefore he necessary for the Government to take other measures shortly, and these are expected to involve unpopular demands on the ex-soldiers. Already the civil servants are threatening to rebel against the proposed reductions of their numbers and their pay. At a meeting held recently the Civil Servants’ Union decided to call upon all their' members, including the employees of the public transport services, to declare a general strike, and to carry it on until the Government’s measures were withdrawn. The danger of such a movement seems always present in France; indeed, the independent Federation of Civil Servants called upon its members and the whole of the working class to take “virile action” to prevent the issue of the decrees. Hopes of peace rested mainly on the possible lack of sympathy for the “fonctionnaires” among the working classes. The announcement made in the cable messages this morning that France proposes to utilise the millions saved by recourse to economy cuts, on defence purposes will he widely debated. Already there is a sharp clash in the French Cabinet on policy measures which may develop into a crisis of the first magnitude, under the terrific pressure of unfavourable economic conditions. The most recent crisis developed in the French Cabinet in consequence of the opposition between M. Germain-Martin, tlie Minister of Finance, and M. Marquet, the Minister of Labour, on the question of whether public works should be financed from the social insurance fund. Disruption was. averted, and it has been announced to the Press that complete agreement exists on this point. It is understood that M. Marquet, who demands public works, won the day. It is not unlikely that a new crisis will develop if the French Government slashes unmercifully with the economy axe, not because the budget should be balanced, but to furnish funds for the strengthening of the country’s defences. The question raised in the message from London has some relation to disarmament negotiations. It is believed, moreover, that a distinct change is taking place in France in relation to the British proposals for reduction in armaments, which ought to result in a substantial relaxation in the terrific strain the defence requirements of France make upon the national purse. It is certain, of course, that France will strongly oppose the rearmament of Germany without some international guarantees which would necessitate close co-operation with Britain, and this would hardly be forthcoming if at this stage the French Government made up its mind to spend millions saved by the swing of the economy axe in the strengthening of the already formidable national defences. AUSTRALIA’S “ DEMANDS.” Dr. Earl Page’s rather sensational pronouncement on Empire trade and his powerful demands for reciprocity will not be overlooked by the Imperial authorities and all engaged in the controversy on the vital problem of trade access to the United Kingdom. Dr. Earl Page demands, on his part, that unrestricted entry of Dominion produce into the Home market should be insisted on. It is known of course that Australia is deeply concerned about the proposal of the British Government that Australia should put restrictions upon its exports of primary products to the Eng-

lish market, particularly wheat, butter and meat. Australia’s High Commissioner in London, returned to the Commonwealth to put the case before the Federal and State Governments. He pointed out that if Australia exported all the wheat it possibly can, without reaching an agreement with other countries, it may find the markets closed. During the last three years Australian export of butter has almost doubled and mutton and lamb shipments have shown a substantial advance also. The three years international wheat shipping agreement entered into a few months ago, has not yet affected production, but a further barrier is feared. The public has not yet been informed of the quotas likely to be fixed. Thus the matter has been discussed only on principle, as an influence on Australia’s progress. There is anxious interest and some opposition. Before the Ottawa Conference Australia, in common with the other Dominions, actively advocated imperial trade reciprocity. Australia granted tariff preferences to British manufactures which remitted duties upon them, as compared with the tariff on foreign goods, to the amount of several millions a year and helped to make Australia (before the depression) the largest national buyer of British manufactures next to India. British and Australian advocates of British immigration to Australia pointed out that Australia should develop her primary industries, “buy British” and gain a further share in a British market for landed products of a total annual value of about 500 million pounds a year. Ottawa was expected to advance this policy. As Great Britain, out of a commendable regard for her own people, has decided to develop her own agriculture, and in the interests of her foreign trade has felt compelled to enter into trade agreements with nine foreign countries, guaranteeing them quotas in the British market on the basis of former supplies, the outlook for Australia’s primary products does not seem over bright. Australia is strongly in favour of imperial trade preferences on a fair basis, and it hopes for a. British-Austra-lian agreement, by which Great Britain will grant a reasonably effective reciprocity. The Australian consumer has paid in excess prices for butter, wheat, sugar and products during the last four years over £3O million, including £8,400,000 on wheat, about £l2 millions on sugar and a similar stun on butter.' “The outstanding capital liability on soldier and civilian settlement in Victoria, including arrears of interest,” said the Acting Premier of Victoria recently, “is £32,772,34(1, and the cost to the State is increasing each year.” The settlers are employed mainly in producing wheat and butter. Hence the persistent call for trade reciprocity that would stabilise Empire markets and ensure more security of tenure for the man on the land.