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Saturday, June 10, 1944

ECONOMIC BALANCE OF

POWER .    ₁₆₀

The W hi te Paper en “Ernploy-ment Policy” (cmii. 6527) is tor many roasons a docurneutof signal import nnce. It reprcsents lin* only seriou.s attempt madę so far by a goYcrnment to re-deline "liberał economies” and to adapt 'Mieni to the requirements ot' a ehangod world. As sucli it is in itself an achievement—whether or not one agreos with the principlos it pronmmees—and it i.s of good omen that it hns been aceomplish-ed by a country whose eeonomie thoughts and creative initiative have so much eontributcd to eeonomie prdgress. Also, it is an eft'eet;ive niuans to clorify Britnin’s •position in world eeonomy whieh bas bron obseured by a propaganda bascd bn a wrong assess-¹ went of relevant facts.

While. in the initial eornmenls after publication. the interna! aspekt of the mensure have lioen sfressed most, il is in faet the International impaet whieh—for the time boing—seems ©f printary interes!. tt bas heen asserted that the włir-tinu* impaet on Britain’« finanoiiil potential bas deprivod ller of the, contrę position slie- lir-ld before the war as an eeonomie groat power. Conseqiiont!y it was suggested she won Id do weil to resign horself tothoTole of a good third after the ononnous finanoinl and productive capacilios of t ho lES.A., and the unriralled demand of the U.S.S.ll. markets. The great merit of the Wbite Paper is thut it has disposed of these fal-liieies by soberly stressing ono fundamental faet. That faet is the revolutionary ehange of the menning of flnanee in eonnomics It is a triiism whieh is upfortu-nately not goilerally acknowledg-eil that the dopletiou of BritaiiUs overscas investnients results in u łmrdening—and not: in a weaken-ing—of lier position in internat ional markets.

In 1938 £200 millions were net income from British oeersea in-vestments, and £63 millions oxeess «»f British gold exports. Tu futurę botll will hnve to be ex<:lnded as credit position in the British ba lance of payrpcTit. “Cash and carry” preceding Lend-Lease, and change.s in the foreign indebted-ness to the London market have resulted in a dis-imestment total

ostimated at £2,843 millions dur-ing tbo fonr yeurs of war ending Dccember 31, 1043.

In 1938 Britain had tu eover an

import surplus amoimting to £388

milliops. If the import volume

of that year is madę the liasis of

futuro foreign trade poltay, that

would inean that. this country

•

must expand its cxport»—prosnm-ing the pro-war priee-lcvel—by nearly 1/3 to maintain its pre-war import standard. The pre-war foreign trade, however, was in-sufficient to seeure a mensure of stable employment. Tt will not be enough to maintain the volume of pre-war British exports. It has t<i bo greatly cxpandcd. A recent hendlinc of an American paper read “ Depa rtment' of Coni-mej-ee studieś report that British profereuces aro dependent on United Btat.cs trade poliey.” The great merit of the Wbite Paper is Iii hiiye madę elear llmt no unilat-eral mensure, but the interdepend-om-o of Imperial and United States trade poliey, i.s the only solid basis o i! a suecessful world eeonomie poliey. It is the stabiliziition of loreign •babince whieh musi be aehieved; independently of the changes in the distribution of in-vcstinents diiring the war.

That does not mean that an ex-punsionist eeonomie poliey eau.be

THE POPE’S

Three days before the yietorious entry of the Albed Armies intó Konie the Pope broadeast his tenth peace$appeal to thp world. In essetiće the views expressed on a just and 1 ast.ihg prace nre in aecord with I bose expressed by Mr. Churchill and General Smuts.

The first lmlf of the broadeast deal willi the fute of the Bternal (lity. In the seeoad hall' the Pope madę four distinct statements:—

1.—The first referred to respon-sibility for the war, in whieh His HolmcSs said that “Responsibility for wars to-day as i o the past can only with difficulty be placed on peoples or nations as sucli.’' British and American Govern-ments uever deiiied this offieially, and repeatod appenis have been mado to Óermans to prove tlieir designed without due regard to an approprmte finaneial poliey. Oom-petent oltservers retnrning from the States nre not at all coinuneęd that the prevailing optimism on the mntter of post-war United States entploylitem is justilied. Tliey feel that the United States after the initial post-war boom aro heading for a profound eeonomie erisis whieh they ran only over-eorne by an expansionist poliey of investment« abroad as a main means of dcveloping new markets. Before, bowever. such a poliey can be earried out, in faet before its out lino can be properly defined, it is necessary to establish a iirm liasis from whieh the new start can bc madę. This Imsis can only l>e an understanding almnt the eeonomie balance of power \\\ the world. In tlie wording of the Wbite Paper: “It. is an essential part of the Government’s employ-ment. poliey to co-operate ac1iveiy with other nations. in the first place for the re-estnhlishiaent of generał eeonomie stahility . . and nex< for the progrossii-e expnnsion of trade.” The Wbito Paper on Bmploymcnt poliey bas m«de elear Britaiirs priaeipal position lo-ward lliis problem. The uext. step would be to complotę Ilu; out lilie of a p.olicy of fuli employment, by u eoneept of foreign eeonomie poliey wbieb, if madę the basis of diseussion. may go a long way to eliminating elements ot' imstabili-ty eaused by tlie laek of control of eeonomie devęlopments abroad.

BROADCAST

lieart by inoring out of target areas, refusing to work in war Industries, to help Jews and otlier perseeuted individuaLs, etc*.—Mar-shal Stalin in his speech ol' Nqvem-1>er 7. 1942, cnllgd people who donbted that tlicie always would lic a Germany and a German Army “ illiterate.”

The second statement of the Pope refers to responsibility for tlie prolong-ation of the war. Quoting Cicero’s "Complete vic-t.ory or complete dest.iaiction— Miero is no other alternatiee for peoiiles or nations,” tlie Holy 1'ather went <>n. “Onee this thought i.s iufused into the mi ud, it turns even thosc who by naturę would be inclincd to aceept. a reasonable peace. Thosc pos-sessed by sueh thonght are cafry-