HC Deb 01 December 1922 vol 159 cc1071-153

Order read for resuming Adjourned Debate on Amendment [30th November] to Question [23rd November], That an humble Address be presented to His Majesty, as followeth: — MOST GRACIOUS SOVEREIGN, We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Ireland, in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament. Which Amendment was, at the- end of the Question, to add the words, But regret that, in face of unexampled unemployment largely the result of four years of mistaken policy, for which the Government as the dominant party in the late Coalition is responsible, there is no proposal for an adequate or equitable treatment of the victims of that policy, including full recognition of what is entirely a national obligation, nor any indication of a change to enable our European customers to buy our goods again and so restore international trade and stabilise international exchange." —[Mr. Clynes.]

Question again proposed, "That those words be there added."


An hon. Member of this House—

Colonel Sir A. HOLBROOK

On a point of Order. I had possession of the House last night. May I not finish my speech? I had some suggestions to make.


It is quite true that the hon. Member was in possession last night, but he did not rise to-day, though I looked in his direction.


I was waiting to be called, Sir.


The hon. Member should have risen. He has lost his chance now.


An hon. Member of this House confided to me last night that he had intended to take part in this Debate, but that he had abandoned the idea because every point that he had intended to make had been appropriated. After a full day's Debate, my position is more difficult than that. It may be impossible not to traverse some of the ground which has already been covered, but I hope, at any rate, to be able to point out some features which have not been observed. The subject we are discussing is no new topic for the House of Commons. Every year since the Labour Party came here in 1906 this question has been the subject of constant debate. But before that the subject of the unemployed had been raised in this House. The late Keir Hardie, who will ever be reverently remembered as the Member for the unemployed, in the years from 1892 was alone in this House championing the claims of the unemployed. There is a certain measure of gratification in the fact that to-day every party in this House professes sympathy with the condition of the unemployed and that the Government to-day recognises the urgency of the matter a ad is prepared with some schemes, at any rate, which they calculate will alleviate the problem. In the days when Keir Hardie first raised this question, his difficulty was in getting the House of Commons and the country to recognise the duty and the obligations of the State towards the unemployed. It was not regarded as a matter in which the State had either a duty or an obligation.

I repeat, therefore, that we are grateful for the change that has come over opinion in the House of Commons in these years. During all the thirteen years that I sat in the House of Commons the Labour party introduced its Bill for dealing with the unemployed. The provisions of that Bill were two. The first was to impose upon the State and the municipalities the duty of providing work for those who were unable to obtain it in the ordinary industrial market, and, failing that, the provision of adequate maintenance. On every occasion on which that Bill was introduced it was opposed by the Government of the day. The Government were opposed to accepting responsibility for the provision of work and they refused to pledge the credit of the State to the maintenance of the unemployed. Very partial and inadequate schemes have been in operation for some time. The proposals which were submitted by the Government yesterday are based upon the provisions and the proposals of the Labour Party's Bill. Whatever has been done for the unemployed by the State and public authorities is due entirely to the persistent agitation of the Labour party, inside and outside this House. In the days to which I have referred the state of unemployment was what might be described as normal, and our proposals were directed to dealing with the normal problem of unemployment. But the conditions to-day are exceptional. If our proposals had been listened to and accepted by the respective Governments to which they were submitted, this problem would have been much easier of solution to-day. The difficulty we have always had in agitating the claims of the unemployed has been that we might be able to enlist public sympathy during a period of exceptional trade depression but that as soon as things became a little easier the problem was forgotten. Yet it is not in times of bad trade, when the problem is acute, that the question can be most effectively treated, but rather in times of good trade, when preparations ought to be made for the inevitable slump which will come.

If we succeed in getting the adoption of schemes which will deal with the exceptional character of the present crisis, the normal problem will still remain, for we shall always have the problem of unemployment with us under a system of competitive capitalism. I would next direct the attention of the House to this very curious fact. The Minister of Labour, in his speech yesterday, stated that the problem of unemployment was not confined to this country. That, I suppose, was intended as consolation and solace to the unemployed. It reminds me of the case of the man who was at death's door; in order to encourage him he was shown a corpse. The Minister of Labour quoted the condition of America. It is a curious fact that the more highly developed, industrially, a country becomes, the more unemployment there is. It is very strange, and the only inference that can be drawn from it is that there is something wrong in our industrial and social organisation. Surely increased production should be followed by the lightening of the burden and the alleviation of the severity of the industrial and social problems which have troubled us hitherto, but the fact of the matter is that with increased producing power and increased production we shall always have this problem of unemployment existing and aggravated so long as the control and direction of industry is in private'hands. It works like this—there is no fixed proportion between the wages of the workman and the value or volume of his output, and the longer his effective purchasing power remains the same, the sooner the market becomes glutted by goods which the majority of the people have not the effective power to buy. The only way in which we can solve the problem of normal unemployment is by bringing production and effective demand into closer relationship, and that can only be done by a progressive increase in the purchasing power of the workers who, after all, are the main customers of the merchants. [Hoy. MEMBERS: "Hear, hear!"] I am glad to have that measure of agreement. If we are going to deal successfully with this problem we should understand that point and every proposal we adopt should be directed in that way.

So much for normal unemployment. Hon. Members will have noticed that our Amendment deals rather with the exceptional or aggravated state of unemployment to-day. It refers to the policy of the present and previous Governments; their policy for the last four years. The question may be asked what has the present Government to do with the policy of the last four years? The present Prime Minister was one of the joint signatories to the manifesto issued in 1918. For half the lifetime of the last Parliament he was the Leader of the dominant party. Therefore, he and his supporters, cannot, escape responsibility for what has been done or left undone during the last four years, I will not weary the House with long quotations but will mention, without quoting, a few of the things which were promised by the present Prime Minister and the ex-Prime Minister four years ago. The first and the basic thing was the establishment of permanent peace. Had that been secured, there would have been no special industrial problem such as we have to-day. As a curious commentary upon that pledge, the Prime Minister himself stated, I believe in this House, two years after the Armistice, that there were at that moment twenty-three wars going on in Europe, every one of them the outcome of the so-called Treaty of Peace. We have no peace in Europe today. We have at the present moment a Conference sitting considering complications which are the outcome of the so called Treaty of Peace. We are standing on the very brink of a catastrophe which, in magnitude, may be far greater than the terrible calamity which we imagined was ended four years ago. In addition to that, we were promised a great scheme of land reclamation and land reform. Returned soldiers were to be put upon the land. Unemployment was to receive the immediate and serious attention of the Government. The ex-Prime Minister went so far as to say that he believed the problem was comparatively easy and that it would not be difficult to find work for every man who was willing to work. A great scheme of afforestation was to be immediately put into operation. The housing problem, in the words of the present Prime Minister, would brook no further delay. So I might go on. These were pledges given by the ex-Prime Minister and the present Prime Minister, by which the electors were deluded four years ago.

What have they done? I do not say they have done nothing, but the sum of all they have done is totally inadequate, miserably inadequate, and in fact, constitutes a gross breach of the pledges by which they obtained office four years ago. So much for our indictment. If my speech were confined entirely to criticising the leaders of the present Government, I might be open to the charge that I had not, and my party had not, any constructive contribution to make to this Debate; but I think that charge can hardly be made and certainly cannot be sustained, after the speech of my right hon. Friend who opened the Debate yesterday. It will be remembered that I said the Bill which the Labour party so often put before this House contained two provisions: first, the provision of work and, secondly, the provision of maintenance. May I deal with the question of maintenance first? In the speech of the Minister of Labour yesterday, he said he had communicated with representative bodies of employers and with the Trade Union Congress asking for their views on the question of insurance by industries. I regret very much the terms of the Minister's communication to these bodies. It appears to me he pre-judged the matter. At any rate he conveys the impression that the Government, if they had not already made up their minds in favour of insurance by industries, are very favourably disposed towards it. There is something to be said for and against every proposal and, in coming to a conclusion, we have to estimate the respective values of the arguments for and against. I admit there is a little to be said in favour of insurance by trades, but the arguments against it altogether outweigh the very few arguments in favour of it. It is urged that by adopting the scheme of insurance by trades we should give the employer a great interest in keeping down the number of unemployed. I admit there is something in that argument, but under a, scheme of insurance of industry as a whole there could be safeguards which would prevent employers from taking advantage of the situation.

There are very serious arguments against insurance by trades, and the principal argument is this, that no trade is quite independent. All industries and trades are inter-dependent, and a great many trades are subject to depression through no fault of their own. Depression in the cotton trade, for instance, seriously affects the coal mining industry. I think this is a strong argument against placing the whole of the burden of maintaining the unemployed on the industry which may at the time being be affected by an exceptional amount of unemployment. Then there is this further point. If the obligation to maintain the unemployed were placed wholly upon a trade, it certainly would have the affect of limiting the activity of that trade and preventing its expansion. If an employer saw an opportunity of expanding his trade, he would hesitate to accept the risk, because, should it fail, he might then have placed upon him the obligation to maintain a large number of unemployed, and I think the argument in regard to the seasonal and especially fluctuating trades is very heavy against insurance by trades. I think—and I believe I am expressing the general opinion of our own party when I say— that we are not in favour of insurance by trades, but rather in favour of placing the burden on industry as a whole. It would be necessary for the State to supervise the schemes and to contribute, and I would suggest that this might be done by what I might call a scheme of equalisation of wages At the present time- every business firm places to reserve a considerable part of its income for certain specified purposes, and why should not a certain proportion of the profits of these companies be placed to an equalisation fund out of which contributions might be paid to maintain wages and to provide for the unemployed during periods of exceptional trade depression?

So much then for the attitude of the Labour party to this question of maintenance. The Minister of Labour jibed at my right hon. Friend the member for Platting (Mr. Clynes) on account of what he seemed to think was an inconsistency in my right hon. Friend's speech. There was no inconsistency in that speech. In the earlier part of it he condemned maintenance as a solution of the unemployed problem, and gave preference, as I think we all do, to the provision of work, and in the latter part of his speech he went on to demand more generous maintenance, but there is no inconsistency there. We must have maintenance if work cannot be provided, and on humanitarian grounds, as well as on the ground of maintaining the efficiency of the worker, it is most important that the amounts of the maintenance allowance should be sufficiently large to prevent physical deterioration.

Now I come to the second and more important of our proposals, and that is the provision of work. I have referred to promises and pledges given by the present Prime Minister and his colleagues four years ago. We place in the very forefront of our proposals for dealing with normal employment—I shall have in a moment to submit our proposals for dealing with exceptional unemployment—we attach the greatest possible importance, for dealing with normal unemployment, to the full development of the resources of our own country, and the greatest of our resources is the land. The ex-Prime Minister has a much more picturesque style than I have. In those faraway days before the War, when the ex-Prime Minister's name was associated with the speech he made in Limehouse, he was going about the country addressing audiences, not at railway stations, but in great public halls, and he had some very pertinent things to say about our land system. I do not think I will quote from those speeches, because the ex-Prime Minister, if he were here, might very properly retort that that is a long time ago and that he cannot be held responsible for the opinions he expressed 10 or 20 yeas ago. I find, however, that he spoke from the Treasury Bench just two years ago, and on that occasion he had something to say on our land system and the need for developing our national resources. On that occasion the ex-Prime Minister said:— Whereas fifty years ago you had something between one-third and one-fourth of the population of Great Britain… working in and around the land, when the War broke out you had something between one-ninth and one-tenth only of the population on the land. It was not merely that the population engaged in agriculture had not increased in proportion to the rest of the population, but that there had been a decrease by hundreds of thousands of those actively engaged in that occupation, and that meant a decrease of the population on the land by something like 3,000,000… Last year we imported into this country for consumption… £500,000,000 worth of food which this soil and this climate are capable of producing… It is a national weakness, it is a national folly, it is a national scandal." [OFFICIAL REPORT, 15th November, 1920; cols. 1611–12, Vol. 134.] That speech was made on the 15th anniversary of the day that the right hon. Gentleman first came into office, and that is an indication of the practical outcome of all the legislation he had achieved. We propose, therefore, that something very drastic should be done, and no mere tinkering with this great question is going to have any effect. We would suggest that the State, in co-operation with the County Councils, should devote themselves to intensive production, and that the principle of co-operation should be much more extensively applied.

Of course, very closely associated with this question, are others such as transport. I do not think the importance of transport in relation to industry, and in relation to the price of commodities, is sufficiently appreciated. There are few questions, in my opinion, so important as transport, and I doubt if we shall succeed in very considerably reducing the cost of production until we have cheapened the cost of transport. I have for many years been interested in this question. I spent four years of my life as a member of the Royal Commission which inquired into it. We spent hundreds of hours upon that work, and the only result of our labours is to be found in a number of very large volumes which are now, probably, covered with dust and cobwebs on some remote shelves in this House. I see opposite my hon. Friend the Member for Holborn (Sir J. Remnant) who also had that painful? experience. I very soon became convinced that you could not consider the problem of transport as a question of waterway transport, railway transport or roadway transport, but that the problem must be considered as a whole. We visited Germany, and I am sure every member of the Commission was very much impressed by the way in which their means of transport were dovetailed, and there is no doubt that the facilities of transport were a great factor in helping the industrial and commercial development of Germany. I was convinced in the early days of our inquiry of the importance of improving facilities for road transport. Indeed, at the time, I made the suggestion that a very considerable sum of money ought to be spent on improving our roads, and my observations had the distinguished honour of meeting with the approval of the Spectator," which said it was the first occasion in human history when a sensible suggestion had emanated from the brain of a Socialist. The proposals made by the Government for dealing with this very important subject are in the same category as those to which I have already alluded. They are a pitiable endeavour to deal with the matter, and the question of improving the roads is becoming every day a much more important one, and, may I add, a much more dangerous one.

In considering all these methods for the provision of work, may I say that I think each scheme should conform to a certain principle? It is this, that the work should be, if not immediately, at any rate prospectively remunerative, and that the scheme should cost no more than it is likely to bring back into the national purse. If that be our idea, then certain proposals are ruled out for immediate consideration. For instance, the proposal is made that we should set the unemployed now upon the laying out of recreation grounds and parks, the erection of municipal buildings and the like. All these are most desirable things, and they ought to be done, but they ought to be done out of our prosperity and surplus, because schemes of this kind would not fall within the category I have just described. They would not be immediately or even prospectively remunerative, except in a very small, and an indirect way. Therefore, the schemes that we ought to put in hand are such as will bring either an immediate or an early remunerative return such as would stimulate trade and encourage production. Transport will do that. Housing, to which my right hon. friend yesterday attached so much importance, is another scheme which falls within that category. Reference was made to the fact that there are over 100,000 men connected with the building trade who are unemployed. That is a scandal and a disgrace to the Government of the country, when the need for houses is what it is at the present time. A big housing scheme would do far more than provide work for the men immediately employed in it. There is not a trade in the country which would not be stimulated by the building of more houses. The furniture trade, for instance, is very much depressed. For every house built and occupied, from;£l00 to £300 would be spent in furnishing. In a hundred ways, if we were really to begin to supply the urgent demand for houses, we should stimulate the whole trade and industry of the country. I need not say much about electrification beyond saying that it falls within the category I have described as being the work which would become almost immediately reproductive.

A word with regard to afforestation. I do not know how many Royal Commissions and Select Committees have sat on this question during the last 20 years. Their name is legion. And yet what has been done? A Minister standing at the Treasury box yesterday said they proposed to deal with the question of afforestation. What did he announce? He was very careful to keep from the House information as to the number of men for whom employment would be found in the aggregate by all the schemes he outlined, but he had a lapse in dealing with the question of afforestation, and he told us how many men it was proposed to employ by the scheme for afforestation which the Government had in mind. What is it? Two thousand. Why, Sir, before the War Germany employed, either wholly or in part, 4,000,000 men in connection with its forests, and we are proposing in a time of exceptional trade depression, with un- employment of the magnitude it is to-day, to deal with this problem by employing 2,000 men.

So much for the schemes of finding work, all of which fall within the category of dealing with normal unemployment rather than with the exceptional volume of unemployment with which we are faced to-day. The exceptional volume of unemployment is, without doubt, as this Amendment says, due to the destruction to a very considerable extent of our foreign trade. We are a country very largely dependent for the employment of labour and the maintenance of our people on our being able to find markets for our products in foreign countries. These Treaties have to a very considerable extent destroyed the markets on which employment depended before the War, and the post-Armistice policy of the late Government has aggravated the inevitable consequences which would in any case have followed from the pernicious Peace. I am not going to argue the question as to whether it is a desirable thing for a country to be in such an artificial position as we are in being dependent for the employment of our people upon markets over which we have no direct control, but the fact is that probably one-half of our population is dependent upon foreign trade.

Our home trade in reality is foreign trade, for the collective demand of the whole market is the sale of products in foreign countries. Therefore anything which affects our foreign trade is bound to have its immediate and disastrous reflex upon the state of unemployment here at home. We have lost, as compared with 1913, certainly one-third in volume of our foreign trade. We heard a great deal yesterday about the importance of developing trade within our Dominions, and inferentially that we might ignore the foreign markets. I do not want to bother the House much with figures. I put a question to the Board of Trade two or three days ago in regard to our trade with three countries, Germany. Austria and Russia; and I find that our trade last year was only one-third of the trade with those countries in 1913. I should say that the loss of that trade alone just about explains the increase in the number of our unemployed at home. That is not due to what we might call the ordinary operations of the capitalist system. It is because the Peace Treaties have destroyed the economic life of the greatest commercial States on the continent. Austria-Hungary was a great economic Union, and she is now the small State of Austria with Vienna as the centre. This city had a population of something like 2,000,000, and these have to be supported by a State the population of which is now not more than 6,000,000. If the loss of these markets be the cause of the abnormal unemployment to-day the solution is to restore those markets. How can that be done?

Some people tell us it is all a question of the stabilisation of the exchange. I admit that the discussion of the exchanges problem is very difficult in a public assembly like this. I have heard it said that there were only two people who wholly understood the theory of the international exchanges, and that one of them was dead, and the other was in a lunatic asylum. I think, however, I may venture to say this: that the question of the exchanges is not the cause, it is a symptom of the destruction and disorganisation of the commercial and financial system, and the only way to stabilise the exchanges is to bring back trade to its normal condition; then the exchanges, I think, will very largely right themselves. The problem is now to get hack this foreign trade. The first thing to do is to realise the pledge given by the Prime Minister four years ago, to establish peace in Europe, to make future wars impossible, to lay the foundation of a permanent peace. What is the trouble to-day? It is mainly concerned with the problem of reparation. The Prime Minister said yesterday that another Conference is going to meet, soon. That, I believe, is the 14th or 15th Conference that has been called during the last three and a half years to consider the application of the Peace Treaty. We do not appear to be any nearer arriving at an understanding, much less a settlement. We do not know how much Germany ought to pay. We do not know what Germany can pay. We do not know how Germany can pay. The Government have no idea, the Government have no policy, upon this question. In the meantime there is starvation and a million and a half of men unemployed in this country who are paying the penalty of the indecision and the incapacity of the Government.

Let us for a moment try frankly to ' face this question, for while Germany remains unsettled commercially there will be no return to prosperity. Until the reparation question is settled work cannot be undertaken, and no sensible business man will enter into contracts with the Continent of Europe so long as there is this uncertainty, and I do not want to say the imminence, but the possibility of the outbreak of another great war. I hold views on this question of reparation which may not be wholly accepted by all the members of our own party. I believe that reparation is twice cursed, it curses those who pay and it curses those who receive. I think we now realise the truth of the economic creed that no nation can live by itself alone. No nation can gain by war. It would be well frankly 10 -abandon the idea of any reparation, for if Germany can pay it would not be to our advantage that she should pay.

There are only three ways in which reparation can be made. There is that savage way in which the conqueror takes away the people as slaves so that they may work for him. I do not suggest that is the way that any hon. Member of this House would suggest that Germany should pay. There is a second way, and that is by payment in gold. That is impossible. There is the third way, and that is payment in kind. If Germany failed to pay we could not force her. An hon. Member on this side of the House, speaking in debate yesterday, referred to the fact of the unemployment in the North East of England. That raised the question of the payment of reparation in ships, and the undesirability of it, for it helps the unemployment. Precisely the same results would follow whatever be the form of reparation payment in kind. I put this question to hon. Members opposite: "What kind of goods would you suggest Germany should pay?" The answer to that question depends to a great extent upon the trade in which the hon. Member happened to be engaged. It is the old question over again. Every man is a free trader in regard to certain industries and a protectionist in regard to others. Suppose it were possible for Germany to pay in goods which did not come into practical competition with the goods that we produce, such as sugar, or potash. That will not alter the thing in the slightest, because Germany would have to make up the difference by extra exports to foreign countries, and it simply means she would be compelled to work all the "harder to increase her exports to neutrals or to foreign countries where she would be entering into a formidable competition with our own trade. Therefore, I say, it is no use leaving this thing in suspense any longer. Sooner or later we shall have to face this fact, that you cannot get indemnity from Germany except in one way, and that way is this: by permitting Germany to get upon her feet once more so that she may become our best-paying customer. By the proceeds of that trade you may get reparation or indemnities that will bless us whilst inflicting no harm upon Germany. So much then for that question. As I say, the settlement of Europe and the restoration of our foreign trade depends upon this.

I want to say a word about Russia. This is a matter about which almost if not all my friends on this side know that I am somewhat heterodox. My hatred of Bolshevism may prevent me from taking that smpathetic and dispassionate view of the question which I ought to take. Russia is the greatest potential market in the world. Our trade with Russia before the war, I know, was not very large. As a matter of fact, the foreign trade with Russia was only about 30s. per head of the population, whereas the neighbouring country of Sweden, far loss endowed with natural resources, had a foreign trade of something like £11 per head of its population. Russia has vast and unlimited possibilities. There you have a population of 150,000,000 and the country is largely undeveloped, and Russia might easily develop a trade of £2,000,000,000 or £3,000,000,000 a year. The market has to be secured and developed, but this country by adopting the policy we have adopted has gone far to destroy the possibility of getting its share of Russian trade. I know the main objection to having anything to do with the internal affairs of Russia after the revolution was Bolshevism. Personally, I believe Bolshevism is such a rotten thing that, had it been left alone without foreign interference, it would have totally collapsed.

I want the recognition of the Soviet Government of Russia. I believe that it would help trade, but what I think it would do is to compel the Soviet Govern- ment of Russia to throw away the last shreds of Bolshevism and Communism by which it is at present fettered. It would compel the Soviet Government to have commercial relations with the rest of the world, and to approximate the Russian system to that of other countries with whom they were having commercial relations. To get trade with Russia, you will have to have confidence in the Russian Government, and I know of no obstacle to free intercourse between this country and Russia except the lack of confidence in the Bolshevik Government. If Russia had to-day the confidence of the commercial countries of the world, I am quite sun; that such are the great possibilities for the profitable employment of capital in Russia that there would be no hesitation on the part or foreign capitalists about incurring the ordinary commercial risks in trading with Russia. For that reason I urge upon the Government the importance of recognising the Soviet Government.

Certain conditions were laid down yesterday which have not the slightest practical value. Take the question of the loans. What is the practical effect of the conditions laid down? Everybody knows that Russia is not going to meet her liabilities with regard to War Loans, and it would, in the most favourable circumstances, be years and years before any Government in Russia could begin to pay-even interest on those loans. In this connection I wish to put this point. I recognise the great difficulties of the Soviet Government of Russia. They have their own people to consider, but I do ask our Government to try and let down the Soviet Government as lightly as possible, and give them an opportunity of saving their faces in the abandonment of Communism. It will cost us nothing whatever, and by adopting that course we should gain immeasurably. Before we can have any large volume of trade with Russia they will have to improve the transport system. If, through the recognition of the Soviet Government, British and other capital were attracted to Russia, in a short time trade with Russia would revive far more than is possible under present conditions.


I am afraid I have already spoken too long. [HON. MEMBERS: "Go on!"] I will not say anything more about the normal volume of trade. In suggesting proposals for restoration apart from what I have indicated, I would say that, in our revision of the Peace Treaties on those lines, we ought not merely to pay attention to racial and national boundaries and conditions, because modern commercial development has destroyed to a very great extent national and racial boundaries as the area of political Government. The area of political government should be co-extensive with economic conditions. That ought to be kept in mind in the revision of the Peace Treaties.

I would suggest that the reason for the failure of the policy of the last four years has been the revengeful attitude of France, which has had very unfortunate results. If the report recently presented to the French Government by a French Commission represents the views and opinions of any large body of Frenchmen, then we might as well abandon all hope of peace in Europe. If the conditions of that report are carried out, Germany must necessarily be prevented from recovering economically and from getting into a position in which she could pay the indemnities. I am aware of the many difficulties in dealing with France, but I can only see one way out of the difficulty and that is by handing over all these questions, which have been discussed, and appropriated by France and Great Britain during the last four years—the consideration and the settlement of these questions of reparation and the like—to the League of Nations, and I would suggest that the League should have power to call into consultation international experts on economics to consider all these problems, and then the League of Nations should be empowered to act upon the recommendation of that Commission.

I wish to point out that, even when we have got back our foreign trade, unemployment will not have disappeared, because in the future normal employment will be more severe, for international competition is bound to be far more severe in the future. The hon. and learned member for Wallsend (Mr. P. Hastings), speaking yesterday, referred to the importance of the reduction in national expenditure, and he was enlightened by the right hon. gentlman the member for West Swansea (Sir A. Mond) I am always interested in the right hon. Member for West Swansea, because I never know what he is going to say or what opinions he is going to express. I have known him in every possible suit in this House. I have known him as the most ardent Free Trader and as the defender of measures of Protection introduced by a Government of which he happened to be a member. I believe he was a member of the Government when the last Budget was introduced. He ridiculed my hon. and learned Friend for expecting that any improvement of trade would result from reduction in taxation. Yet he was a member of a Government that introduced last year a Budget which, by almost fraudulent means, brought about a reduction in the Income Tax for the declared purpose of improving trade. They did it because that representative body of British industrialists, the Federation of British Industries, held a pistol at their heads and told them that commerce and trade depended upon the reduction of national expenditure. It does, and, after we have settled the European question, trade will depend far more upon the reduction of non-productive expenditure.

I am not going to be betrayed this afternoon into saying anything about the capital levy. I am, if I may say so, far too old a Parliamentary hand and far too much experienced in public controversy, to rise to a bait like that at a time like this. I can assure hon. members opposite that we shall welcome and not shirk the first opportunity presented by the business of the House to deal with this question and to ask hon. Members opposite, and I believe some hon. Members sitting below the Gangway on this side of the House, to say to our faces the nonsense and misrepresentation that they thought good enough for the Election platform. Let me come back to the point of maintaining our foreign trade after the War. Competition will be severe. There is an impression among hon. Members opposite that Labour is opposed to more intensive production. That is not so. All we are opposed to is that the whole of the fruits of more production and the intensification of industry should go elsewhere. It will be necessary in future, if we are going to hold our own, that there shall be no opposition to anything that is likely to cheapen the cost of produc- tion. There was a pledge given by the right hon. Gentleman and his colleagues in regard to the hours of labour. We were promised a uiversal legislative eight hours day. I believe that a universal reduction in the hours of labour would to-day absorb far more unemployed than are going to be absorbed by all the schemes submitted by the right hon. Gentleman. If we are going to hold our own after the War and not have this problem constantly cropping up,, we shall have to eliminate all non-productive expenditure and parasitism in industry. There is no country in the world that has to bear such a burden of parasitism as this country.

In conclusion, let me say a word or two about the proposals submitted from the Treasury Box yesterday afternoon. They are, as I have said, painfully inadequate. How many men are going to be provided with employment by all these schemes? The right hon. Baronet did not say. A hundred thousand? Two hundred thousand? Not more, and there are 1,500,000 out of work. Therefore, what the Government say to the unemployed is this: "You have to continue to exist upon miserable and insufficient doles." That is the bankruptcy of statesmanship. There is something more involved than the provision of employment. Confidence in Parliament and confidence in Government—constitutionalism—are involved in this question. Hungry men become angry men; and angry men become dangerous men. I would deplore any resort to any other method than parliamentary action, because I know it would be ineffective Therefore, may I ask the Government to reconsider their proposals and to bring forward something commensurate with the gravity of the problem. The right hon. Baronet appealed for the help of those on this side of the House. He need not have made that request. He will get that help in any practical and effective proposal that he brings forward. We only ask him to do more. This Government have a great opportunity, because I can imagine no more crowning glory than that the Government should be able to say that they have removed this stain from our civilisation and this reproach from our statesmanship.


I am sure that the whole House welcomes back again the hon. Member who has just spoken. Those of us who knew him in the old days may find him somewhat mellowed. The greater part of his speech might have been made from these Benches. There were moments which reminded us of the old times when we expected hard knocks—kindly knocks— always to the point from the hon. Gentleman, and I think and I hope that we shall get them again, and frequently. He ought to be gratified by the welcome that the. House has give in him. He has quite lightly said that unemployment has been h problem which has engaged the attention of this House ever since he and I have been Members of it. It is true that he claims that the Government's efforts today are really due to the activities of the Labour party in past years. He reminded us that year after year the Labour party brought in a Bill for employment. But he himself has given the answer why that Bill did not succeed. It was a Bill to enforce upon Governments and municipalities the provision of work for the workless. But it failed to find markets for that work. It failed to find the customers who would consume that work, and he himself gives us the answer when he says that something like half of our working population is dependent upon foreign trade. I do not agree with his figure, I think he has over-stated it. I do not think it is as much as half, but certainly it is a large proportion, perhaps a fifth, of the whole working population that is dependent upon foreign trade. He is right, therefore, in dealing with this question first from the point of view of foreign markets.

He and the right hon. Gentleman the Member for Platting (Mr. Clynes) blame the late Government for causing unemployment and failing to deal with the problem through their foreign policy. He said they caused it by not settling the Reparation question, and by their folly in dealing with Russia. That is how the right hon. Gentleman the Member for Platting described the Government's policy. Let me deal with that question for a moment. Take reparation. It seems to be suggested that some large sum has been fixed for reparation. The right hon. Member for Platting put it at £22,000,000,000 originally, and said that it had come down first to £6,000,000,000, and finally to £2,000,000,000, and he said because of that we are suffering unemployment. The figures are wrong. There is no fixed sum for reparation. It was because the Government realised that it is impossible to assess immediately the capacity of Germany to pay that no fixed sum was settled for reparation. It is quite true there has been mentioned a total of £6,600,000,000, or the equivalent, but that total is subject to reduction by the Reparation Commission—a body which can at any time take into account any claims put forward by Germany of inability to pay. That Commission has the right to reduce the sum so as to bring it within Germany's capacity.


That is the total of their claim.


Yes, the total of the claim, and I can assure hon. Members that the efforts of the British representatives at the International Conferences have been directed towards bringing the amount down to a reasonable basis and towards modifying any asperities in any direction. No one can say that the British have been endeavouring to pin-prick or to exalt in victory, or to do anything except bring about peace and that at the earliest moment. Hon. Gentlemen opposite, when they blame the Government, seem to think the Government has the sole control of European or international policy. They scorn to forget that the British Empire as a whole is only entitled to 22 per cent, of whatever reparation is paid. We are, in fact, in the position of a junior partner. We cannot dictate either the amount to be claimed or the course to be adopted, and when hon. Gentlemen have the responsibility of dealing with this question they will find that it is not what we say or what we wish only, but that we have also to take into account those who are entitled to a larger proportion of the reparation than we are and that we cannot force our views upon them. The hon. Gentleman said that reparation was twice cursed; that those who-paid were cursed, and those who received were cursed. Does he blame the Government for that? I do not think we are cursed. We have neither paid nor at present have we received.

The hon. Gentleman asked how reparation is to be paid? He said there is no gold, and as for the German ships and goods, we do not want them, because we do not want our people to have their employment destroyed. Does the hon. Gentle- man think that Germany is going to do no trade anywhere? If she does do trade, why should she not pay an export tax? There is no such dilemma as he suggests. Germany will do a large export trade, whatever we may do, and why should she not pay a portion of the receipts she will get from that export trade towards reparation? Someone is going to suffer by the damage done by the War. Why should France be the sole nation to suffer? Why should not Germany pay something towards the losses caused by the- War, and why should that necessarily disturb either the peace of Europe or our export trade 1 If Germany did pay an effective tax on her exports—and hon. Gentlemen will remember that these are exports which will compete with our exports—we shall suffer less in that fierce competition which is to come than we should do if there were no export tax on German goods.

I should like to say one word about the supposed folly of our dealings with Russia. The hon. Gentleman said that Russia ought to have a very large export trade, amounting to thousands of millions per annum, and that we ought to benefit by it. What did we do? Not without a great deal of opposition, we did enter into negotiations for a trading Agreement, and we did make such an agreement with Russia That it has not come to much is not our fault. We are and have been perfectly willing to trade within the limits of that Agreement, but the money which Russia had at her command, and which might have been used for trading, was used for purposes more congenial to her rulers—for propaganda against the British Empire. The hon. Gentleman also said that the terms that have been laid down for the full recognition of Russia were stupid. Those terms of recognition were laid down at Cannes, and my right hon. Friend the Prime Minister practically repeated them the other day. I did not recognise any difference between his formula and the formula laid down at Cannes. They were simply that Russia should behave honestly, and nothing more; that she should restore property that she had expropriated or else pay compensation for it; that she should recognise her public debts—not pay them, but recognise them—that in fact she should assume the attitude of mind of an honest Government, and nothing more. The hon. Gentleman asked what was the use of insisting upon that, as it was known perfectly well that if Russia did recognise her debts she would not pay them.


Could not.


I accept the correction, but surely there is a difference between a man saying "I do not owe," and his saying "I recognise my liability, but I cannot pay." I would not mind if Russia said "I recognise my liability, but I cannot pay." I should be perfectly willing to meet her and to say "You shall have time, "or "You shall pay only a small percentage of the whole." But I want her to recognise the fact that the public liability of a State is a public liability which ought not to be repudiated. It is the basis of civilisation, both with the individual and with the State. That is the difficulty. Surely the hon. Member is wrong when he said that it matters not and that it is a mere formality. It is something which goes to the base of the State's existence. We are told that we have been guilty of folly in dealing with Russia. What more could we have done with Russia. After all, it takes two to make a quarrel, and it equally takes two to make a bargain. We were willing on our side. We laid down conditions which were perfectly reasonable, but those conditions have not been accepted by Russia. It is necessary to look elsewhere than to the folly of the late Government in order to find the cause of unemployment. In my judgment, the cause is simply the poverty of our customers, both at home and abroad. The poverty of our customers abroad is due entirely and directly to the War, and to nothing but the War. The poverty of our customers at home is due, again, to the War, and partly, of course, to the very high rate of taxation.

Let me now deal for a moment with the other complaint which the right hon. Gentleman the Member for Platting made, and which was supported so ably by the hon. Gentlemen opposize, namely, that the measures of the Government were so inadequate that they only provided work for one out of twelve or one out of fifteen people. It is true that they only provided, directly, work for something like that number. I do not agree as to the figure of one in fifteen; I think it is nearer one in ten: but, again, the House has to remember that the schemes of the late Government have not yet matured. Take the Export Credits scheme. Something like £22,000,000 of credits have been arranged for, but those have not all matured in the shape of employment in this country. The process is that, in the case of a big order, the firm that is going to undertake the work wants to know that the finance can be arranged. Before they begin to manufacture, the finance is arranged, and after that the work is put in hand and employment commences. I believe that there is quite a lot of employment still latent in those schemes, which will very soon come to fruition. It is so much easier to complain and criticise another person's policy than it is to put forward a constructive policy. The hon. Gentleman twitted us with having had fourteen international Conferences since the Peace Treaty, and yet not having secured peace. I believe it is true that the Labour party have had 20 Conferences on unemployment during the last; few years, and they come here and criticise us for not having produced a scheme sufficiently wide to cover those who are out of employment. The hon. Gentleman made a most interesting speech to-day, but I defy him to point to a single constructive proposal which was formulated in any sufficient detail to be put into operation. For example, he was inclined to read, was it the Limehouse speech, or some other speech?


It was a speech delivered two years ago.


The hon. Gentleman began with the Lime house speech—


I was not aware that the ex-Prime Minister was here, or I certainly should have quoted it.


I am quite, certain that the hon. Gentleman would not have run away. He said that the land is undeveloped, that 2,000,000 acres have gone out of corn production during the last few years, and that that is a scandal. I do not disagree with any of that. He suggested that transport ought to be improved, that there ought to be more co-operation, and so on. But what vague words those are! What is his proposal? Has he got a proposal?


indicated assent.


He has? Well, would it not be wise that that proposal should be put before the Government, so that the Government can see it? It is one of the most difficult and important questions. If we could in this country enlarge our base, so that we really did become a bit more self-supporting, there is not one member in this House, on whatever side he may sit, that would not welcome such a heaven-sent scheme. That is the difficulty. If the hon. Gentleman, instead of talking vaguely about improving transport, or improving production by means of co-operation, would tabulate a scheme, even in the rough, it would have, I am quite certain, the most careful consideration from the unofficial members of the House, because that is exactly the scheme for which they are looking. The right hon. Gentleman the Member for Platting was equally vague. He skated round some of the most interesting subjects. He said, "In war you could organise nationally; why cannot you do it in peace? "Is that his proposal? Does he propose that we should again set up new Ministries as we did in the War, that we should organise nationally another Ministry of Munitions, for example, for peace purposes? It is extraordinary that he should make a speech of that sort without being much more precise. Before the Election, the Labour party were more precise. They issued a manifesto, which said: Our industrial policy involves the prompt nationalisation of the mines, the nationalisation of railways, and other measures for the protection of the workpeople. —[HON MEMBERS: "Hear, hear!"]


I know. That is honest. You really mean it. But Mr. Arthur Henderson— I am sorry he is not in this House—went a bit further. He said the nationalisation of mines and railways was but a step to the nationalisation of industries. [HON. MEMBERS: "Hear, hear!"] I am glad that he has supporters in this House. But that is not what the right hen. Gentleman the Member for Platting said. He skated round that subject altogether. He said, "Yes, there is a duty upon the Government to find employment; why, if we can organise in war, should we not be able to organise in peace?" Does that mean nationalisa- tion? Is that what he means? If he does mean that, why should he not say so? It would be a good deal better that we should really know where we are. [An HON. MEMBER: "Have not you got there yet?"] I know where some other hon. Gentlemen are, but I want to know whether that is the meaning of the official Amendment to the Address which is moved by the Labour Party. That is of great importance. It is of no use to twit the Government with only finding work for one in 10 if you are not at the same time able to show some means for providing more work for more people.

Of course, the real question about which hon. Gentlemen have to make up their minds is, do they mean to abandon the system of working for profit, and adopt the system which they have hitherto advocated of working for use—production for use, that is to say, irrespective of profit? If there is a profit in it, there is no trouble about private enterprise doing it. Private enterprise will do it quickly enough if there is a profit in it. Hon. Members are suggesting that the State shall set to work to produce goods, not to be sold, but to be distributed in some way or other amongst the customers in this country; but hon. Gentlemen who make that proposal have got to go a little further. They have got to show where the money is coming from; and the right hon. Gentleman the Member for Platting again shied at that. The hon. Member for Wallsend (Mr. Hastings) was much bolder than his leader. He said at once, "Yes. A capital levy is where the money is coming from. "He was not cheered quite so much as he might have been on those benches, and indeed he showed that he was a bit afraid of his own proposal because he wanted us to get him out of it. Let us see what he proposed. He did not want to debate the capital levy on the Floor of the House. He wanted it referred to some economic Commission—the 15th is it to be, or the 21st?—some economic Commission which was to consider it and turn it down and let the Labour party out of their difficulty —get them out of the incubus which has lost them dozens of seats.

I want to deal with what seemed to me to be a scoff on the part of the right hon. Gentleman the Member for Platting at the proposal of the Government to develop Empire trade. The right hon. Gentleman the Member for Spen Valley (Sir J. Simon) also enjoyed himself on the same question yesterday. He seemed to think there was some inconsistency between my right hon. Friend the Member for West Swansea (Sir A. Mond) and the late Prime Minister in dealing with the question. Of course the world is an economic unit, but is not the Empire also? It is a smaller unit, but it is a unit, and it can be made more and more a self-contained unit. The proposal of the Government is, as I understand it, to explore that situation with a view of developing the Empire and making it more and more a self-contained unit. Does the right hon. Gentleman the Member for Miles Platting want, because the world is a trade unit, to ignore the Empire altogether? Surely if yon cannot get the world mechanism going, it is worth while to develop the mechanism of the smaller unit so that we can get as much trade as we can.


I can let pass many of the preceding inaccuracies in the right hon. Gentleman's speech, but I cannot let this pass. What I said is on record. I was the first man on this side of the House, when the Government some time ago brought forward its proposals to assist and stimulate Empire trade in relation to the great Exhibition, and I have done my best in that direction. What I said yesterday was to the effect that we must not neglect the larger areas of population in other parts of the world.


Of course, if I have misrepresented the right hon. Gentleman I gladly correct any misrepresentation I made. What I had as the effect of his statement was that he was pointing out that the white population was only 15,000,000 or thereabouts, while the other population was 300,000,000 or thereabouts, and the Government proposal was to look after the 15,000,000 and not the 300,000,000. That seemed to me to be scoffing at the trade which can come out of the 15,000,000. He did not even then take the whole point because, besides the 15,000,000 or thereabouts of white population, we have a very large empire in India, the development of which may bring very considerable work to this-country. If the right hon. Gentleman will consider the question of railways alone, there is a possibility of spending usefully, in. extending and improving the equipment of railways in India, anything between £30,000,000 and £50,000,000, which would bring to this country an enormous amount of direct employment, and it is very well worth while that that should be considered by the proposed Commission. I want to turn to the proposals which are being made by the Government for the exceptional unemployment at present existing. So far as they go, I agree with each one of those proposals. I am a little disappointed that some extension has not been found possible of the actual work which was set on foot by the Government last year. As far as I can calculate, the Treasury is releasing a sum of rather under £4,000,000 for the purpose of carrying out those schemes in addition to the sums which we set aside last year. I hope it may be enough, but my own belief is that it would have been better to deal with the question on rather wider and bolder lines. I am glad, however, to hear that the Unemployment Committee of the Cabinet is to be in constant session. I have no doubt, therefore, they will be able to review the schemes they are putting forward and extend them when they think necessary. There is one proposal which they have not, as far as I know, considered. It is a very interesting proposal, which was brought before the late Government by the right hon. baronet the Member for West Swansea (Sir A. Mond). He himself spoke of it yesterday, but unwittingly, I think, he may have given perhaps a false, or at any rate not a complete impression of what the scheme is. He pictured a man. going to an employer with his unemployed benefit in his hand asking for employment at a lower rate of wage because of his benefit in his hand. He pictured it rather as a subsidy in favour of low wages. I think he unnecessarily damaged his own proposal. There is much more good in it than he showed the House. There are two ways in which it might be used, because, in essence, we are all agreed that it is not unemployed benefit that a man requires—it is work. In essence, we are all agreed that, if work can be provided, even at the same cost as unemployed benefit, it would be infinitely better for the man and for the State. So the problem is, how to use the money which would otherwise go in unemployed benefit for the purpose of obtaining work. There are two ways in which it might possibly be done. You might take either a geographical unit, or you might take an industrial unit. You might take an area in which we will say there are 50,000 men out of work, drawing benefit, and you could say to the local authorities, or public utility companies if you like to exclude the private employer, "if unemployment is reduced in this area by works you bring into operation after date, for every man taken off unemployed benefit you shall have as a contribution towards the cost of the work that you have put into operation the amount which would otherwise be paid to me as unemployed benefit." That is not a subsidy to wages; it is not a subsidy to low wages at all. It is only another method of measuring the amount of contribution from the central or State fund towards the local fund, or the fund of a public utility society. There is another way of doing it. Instead of taking the geographical unit as the unit to be relieved, you could take in certain cases the industrial unit. For example, in regard to house building you might do the same thing. For those who are brought into employment by local schemes, you might give, as a contribution, the amount which would otherwise have been paid in benefit to the men who are employed in that way. I, therefore, ask that the Government should consider this scheme. It is worth examination. It would have been examined by the late Government if untoward things had not happened.


It was examined.


It was examined, but not completely examined. I remember being asked to examine it, but I regret to say that other things prevented its being fully examined. I think it ought to be examined by this Government, because I believe there is a way there for further consideration. I am afraid that recovery from the War is going to be, and is bound to be, slow, and that the problem of unemployment is going to be with us for years to come. It may well be that by stimulating trade we may begin to reduce the size of the numbers of unemployed. I hope we shall, and I believe we shall. On the other hand, the measures that we take must not be measures for to-day or for to-morrow only, as if at the end of this winter unemployment is going to disappear with the melting snow. It is not; it is going to be with us for a considerable time to come, and it behoves all of us, never mind on which side of the House we sit, to contribute whatever we can towards the solution of this serious problem.


I have risen for the Special purpose of putting the serious position in my constituency and in the City of Sheffield before the House and the country. I have been asked to do this by my colleagues in the representation of Sheffield. During the War, Sheffield was the great arsenal of the country, turning but munitions of war of all kinds, especially guns and shells. Suddenly, the War came to an end, and the large works which had been engaged in making munitions became idle and the people who were engaged in making munitions of war were thrown out of work. Not only were our own population engaged in these war industries, but we had a large influx of outsiders to help us to do this vital national work. The large plant which we had for this work is very special and expensive plant and could not be used for any other purpose when the War came to an end. The rolling mills and forges could not be used for small work. Therefore, it had to be thrown out of gear. We made a request to the Government that they should grant us a subsidy so as to keep this plant in working order, in readiness for national purposes again whenever it was required, but they refused to do that. Nevertheless, we have kept the plant in repair, and the Government will have the advantage of it whenever they wish. It may be said: "You were very busy during the War in Sheffield and made great profits, and the workpeople made great wages." That is not quite correct, because the Government took care that we did not make big profits. The munitions levy took care of that, the bulk of the profits being taken by the Government.

In the proposals which the Government are making for dealing with unemployment, there are two or three things which I think could be of assistance to us in our difficulties. First of all, with regard to the battleships, I got a satis- factory answer the other day from the First Lord of the Admiralty to the effect that progress was being made in regard to tenders and contracts. If the contracts could be given out at once, work could be found for our people during the winter months. That is what we require. It is the immediate future for which we require relief. With regard to railway work, I am glad that the Government have been able to summon the railway managers and have got from them promises to anticipate orders for railway plant and development in the immediate future. If those orders are given out now we shall get work during the winter which will be of very great assistance to us. Electric power stations were mentioned yesterday. The work would also be of very great help to us in finding employment for our people.

We have no fewer than 32,000 people unemployed in Sheffield. The number has been over 50,000, but it has gradually gone down. We stand in the unfortunate position of being second on the list of towns with the largest number of unemployed. A White Paper was published by the Ministry of Health the other day which gave 10 unions which stood at the highest point in regard to the amount of relief given, in Poplar the figure was 175.3 per thousand of the population. Sheffield came second with 164.7. Middlesbrough, Barrow, Stockton, Newcastle, West Ham, West Derby and Pontypridd came next in point of order. These ten Unions alone represent over 406,000 people unemployed, or, in other words, 27.9 per cent, of the unemployed belong to these ten Unions, which contain 10 per cent, of the population of England and Wales. With regard to rates in Sheffield, the rate to the end of March, 1921, for relief was 7s. 6d. in Sheffield and 5s. 1d. in Eeelesall. These figures for the two Sheffield Unions were increased in March of this year to 10s. 2d. in Sheffield and 11s. in Eeelesall. The total rates in the city at the present time amount to 21s. 10d. in Sheffield and 22s. 6d. in Eeelesall. The corporation have done their very best to keep down the expenditure. They have a system of rationing, and they have reduced the rates so much that the amount brought in by the rates is £200,000 less than last year. If this can be done locally, this House ought to be able to reduce expenditure in the national interest.

In addition to the high rates, Sheffield has had to borrow. The two Unions have borrowed £850,000 on account of unemployment relief, and that money has been spent on unemployment. That is a debt which will have to be repaid out of future rates, and it will be a very great burden. I had the honour last summer of introducing to the Prime Minister a deputation from the Poor Law Guardians who were most in distress. The right hon. Gentleman received us with very great sympathy, but at the end he said: "If I am to give you relief of your rates, it must come out of the taxation of the country, and I cannot do that at the present time." That is an argument which I am not prepared to meet, and as that was the difficulty then I am afraid that it may be the difficulty now. The Sheffield Corporation have put forward large schemes of relief works. The works in hand at the present time amount to £262,000, while the works commenced represent £418,000 and the works projected £244,000. So the corporation has done its best to meet the situation. All that I am asking now is that in all schemes to be brought before them, and in any proposals of their own, special consideration should be given by the Government to this city in its present distressed condition. I am sure that I shall have the sympathy of my right hon. Friend and that he will place no technical difficulties in the way. There are technical difficulties, I know, but these ought to be swept away and nothing ought to be allowed to stand in the way of this necessary object being attained. As to the recipients of the money, they have been most patient and persevering. The order in the city generally has been very good indeed. I am very glad to be able to make that public statement, but they are getting a little bit restive now. They think that they have been put off long enough and that relief in the shape of work ought to come forward now. I feel, however, the greatest confidence in the sympathy and support of the Government.


As a Member also for the City of Sheffield I want from this side to put in a plea to the Government for every consideration possible to be extended to that city at the present time. We had a discussion the other day with representatives of Sheffield local authorities and I believe that representations are being made to the Government. The City of Sheffield is perhaps the most hardly hit of the industrial areas in this country and we should have some real help offered to us from the Government at this time. That does not do away with the general plea of the party that sits on these benches, that the condition of Sheffield and other industrial areas makes it clear that this is a national problem, and that not only the necessitous areas like Sheffield, but all parts of the country hit by unemployment should have definite immediate help from the national Exchequer.

1.0 P.M.

In regard to the particular difficulties of Sheffield the hon. Member for Eccles* all (Sir S. Roberts) referred to the amount of money which they have had to borrow to meet their difficulties. Yesterday the Minister of Labour suggested still further loans to meet the situation. Loans of that kind will not meet the situation. I have no doubt that he has received from the conference of the representatives of the boards of guardians suggestions under which definite aid should be given to Poor Law areas like Sheffield, especially at the present time, in relation to the excess amount which they have had to spend on Poor Law relief over the amount which they had to spend in pre-War days. If necessary that special aid should be given by a per capita grant, with such safeguards as might be necessary to secure, efficient control over the local spending of the grants from the National Exchequer. I hope that those representations will be carefully considered by the Minister of Labour, and the Minister of Health, in order that some immediate relief may come to such necessitous areas as Sheffield. Apart from the peculiar case of Sheffield, I desire to say a word or two on the general question. The right hon. and learned Gentleman the Member for Spen Valley (Sir J. Simon) yesterday referred to those old lines, The devil was sick, the devil a saint would be, and so on. I feel sure that he was really directing that against his own party and not at any other party in this House. I remember reading a speech delivered by the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) at Newcastle in 1903, to which it is interesting to refer as we on these Benches are so frequently charged with being desirous of establishing a class Government. That was said all over the country during the Election. The right hon. Gentleman, having spoken of trusts and monopolies, went on to say: My last monopoly is the great monopoly of the governing class. What does that mean? There are about 6,000,000 electors in this land at the present day and yet the Government is in the hands of one class. They have so manipulated Parliament that it is ail in the hands of that one class. It does not matter up to the present which party is in power. You have practically the same class governing the country. There is no democratic country in the world where such a state of things exists Yet it is his party and the party who occupy the benches opposite who are so continually hurling at us the charge of desiring Government by one class and one class only. But that was in the days when the right hon. Gentleman was in opposition. A year or two afterwards he was seated upon the Treasury Bench. Meantime representatives of the working classes had begun to grasp the nettle of class monopoly in Government to which the right hon. Gentleman had referred. Representatives from the working classes were returned to this House. Then the right hon. Gentleman went to Cardiff and suggested that there was no cause for alarm at the new Labour agitation. He said at Cardiff in October, 1906–and I would like to draw the attention of Liberals to this—that Liberalism would never be ousted from its supremacy, in the realm of political progress, until it deserved to be deposed for neglect and betrayal of the principles which it professed. I would suggest that it has been deposed. The Liberal party to-day is the third party in the House. Liberalism has betrayed the principles of progress which it professed, and the ideas of progress on behalf of the people are now to be found on these Benches and not on the Liberal Benches. He concluded his speech by saying that the working man is no fool and we have proved it in these elections. We have doubled our representation here, and we will increase it further until we occupy the Benches opposite.

The working man understands more than any other the hardships which he has to endure. He not only understands a movement like the trade union movement but also the movement with which I am connected, the co-operative movement, an association of consumers as well as producers. Hon. Members opposite pride themselves upon their superior knowledge, but there is hardly a Member on these Benches who has not only practical knowledge of the organisation of producers, but has practical knowledge of trade and business from having graduated as a member of a committee of management of industrial co-operation, and who are able to speak not merely from text book knowledge, to which it is often said we are confined, but to speak from actual experience of the organisation of industry in this country to the extent of a turn-over of £350,000,000 per annum, and to speak with peculiar knowledge of what it costs to get raw materials, to provide wages, and to distribute, and what it ought to mean in price to the consumer at the end of the production and of the distribution. It is from that point of view that we are going to continue during this Parliament to put forward not merely theories but trading facts.

It has been said during the Debate that the root cause of unemployment is underconsumption. I want to stress one or two things in that connection. Underconsumption is the root cause of unemployment and it is the direct result of the present organisation of industry and commerce in this and other countries. It ought not to take hon. Members long in their study of the subject to make up their minds that that is so. All the improved methods of production of the present day, as has been clearly shown by a previous speaker, mean production at such a rate that there must be a surplus, unless the method of distribution of the wealth produced by the application of labour to capital is altered. We need only to look at the fact which was given to us yesterday by the hon. Member for Hampstead (Mr. G. Balfour). He said that the employing class was small, that there were only a few of the employing class. Let us look at the returns of the Board of Inland Revenue for Income Tax and Super-tax. We there find that although, perhaps, two years ago the capitalised wealth of this country was £18,000,000,000, it would not be more than £16,000,000,000 to-day. Of that £16,000,000,000 no less than £13,000,000,000 is held by fewer than 250,000 people in this country. That is the direct result of the distribution of the wealth produced by the application of labour to capital in this country.

What does that mean? It means that even those who are most profligate and extravagant and luxurious amongst the class which takes an undue proportion of the results of the toil of the struggling masses of the country are unable to consume the wealth which they take as their share of production. They invest it again and again in more machinery, more productive enterprises, with the result that again and again you have cycles of unemployment, and the individual labourer has not the capacity to purchase the goods produced. That is the root cause of unemployment, and until something is done to alter it you will always have it with you. I suggest to hon. Members opposite that in the Co-operative movement, composed almost entirely of the industrial working classes, we have a better way altogether. One of the most iniquitous things—it is frequently overlooked—is that the result of the toil of the worker is always strictly limited—the wages of labour are always limited—but the wages of capital in most cases are unlimited.

I will put it another way. We have heard of one or two examples of the profits of capital. At a time when private soldiers were fighting in the trenches for 1s. 6d. a day and their wives and dependants were existing upon the allowances paid to them by the Government, the Maypole Dairy Company, dealing in just those foods which are required by the working classes in this country, paid on their share capital, over a period of six years during the War, an average dividend per annum of 128½ per cent. It is when you see things like that in regard to the distribution of the results of the application of labour to capital that you see the real cause of our trouble. In our own movement—I do not say that there may not be even some better way— the first principle is that the earnings of capital are strictly limited. Until you get a similar arrangement for the rest of the industry and commerce in this country, there can be no real solution of the unemployment problem. If we can get a limitation of the earnings of capital in such a way that we may increase the rewards of labour, increase the purchasing capacity of our in- dividual workers, we shall be going a long way towards removing under-con-sumption and our unemployment problem.

Captain Viscount CURZON

And limit the losses too?


I would suggest to the Noble Lord that the people who say that they have had losses have done fairly well during the last three or four years. Their hardships cannot at any rate be compared to the sufferings of 1,500,000 unemployed. [HON. MEMBERS: "The Cooperative Wholesale Society."] Someone mentioned the Co-operative Wholesale Society. That society was able, because of the great confidence in the institution felt by millions of co-operators in this country, to carry through at a time of great depression, far better perhaps than any other trade organisation of its kind.


They accumulated a big reserve during the War.


The only other thing I want to say about consumption is that the same problem of under-con-sumption is connected with the direct failure of the Government to arrange such a peace as was promised in 1918. So far there has not been a normal resumption of trade with European countries. The workers in other countries are so depressed and debased as the result of the Versailles Treaty that they are unable to-day to consume as much as they used to consume. I hope the House at an early date will not only deal with this immediate and pressing problem, but get down to the basic facts of the situation, in order that they may eliminate once for all this root problem of unemployment.


May I ask the indulgence of the House to say a few words about what is undoubtedly the outstanding problem of the day. We are just entering upon the third year of acute depression and unemployment. Since the Armistice the Government contribution towards the relief of unemployment can hardly be less than £100,000,000. If there was a prospect that half this sum would bring us to the end of the cycle of depression our anxiety might reasonably be less than it is. During the last two or three years, no doubt, most of us have made it our business to watch closely the steps which the late Government took to meet this unemployment problem. One is bound to observe the same sinister resemblance between their mistakes in organising for the War against Germany and their methods in organising for the present war against unemployment. In each case they display the same optimism about the duration of the trouble, the same delay in organising on a grand scale, and the same hesitation to co-ordinate and centralise their efforts. Under the circumstance these may have been pardonable mistakes, but I fear that in our present troubles we may be confronted with the same old overlapping and wastage of the nation's resources.

We have, apparently, accepted the position that the nation is responsible, at any rate in part, for keeping from starvation those who have lost their employment in the present emergency. We have, presumably, accepted this problem as one to be solved in accordance with business principles. We are bound to inquire, and the sooner we find the answer the better, whether the system of unemployment relief which we inherit from our predecessors, will stand the tests which economic principles impose. Can we say there are not too many authorities at work? Are we satisfied that our available means are being properly conserved? Nothing would justify our dissipating money wastefully through any lack of coordination of these several sources. At the present moment the Government is contributing through at least four sources— the Unemployment Grants Committee, the Trade Facilities Committee, the Export Credits Department and the Unemployment Insurance benefit. The last, I understand, has disbursed £22,000,000, the accumulation of many years of saving, and they have incurred a further debt of £27,000,000, and they are consequently now bankrupt. Outdoor relief and other forms of local grants towards the relief of unemployment are familiar to us all. No doubt hon. Members of the Opposition could tell us of enormous sums which trade unions have spent for the same purpose. Is there any central authority whose duty it is to ensure economical and efficient administration? No one grudges—I certainly do not—the money which is necessary to maintain the unemployed worker at the present time, but it is due both to the unemployed and to the taxpayer that every £l so spent should attain full value and that it should be properly distributed. It would be a betrayal of the interests of both, that a sum should be spent on two men which, by better organisation, might have maintained three.

One week and another, the Ministry of Labour, the guardians and the trade unions are paying out contributions to hundreds of thousands of men. I should like to ask the Government whether they have considered calling together representatives, particularly of those bodies who are concerned with outdoor relief, with a view to forming a central authority equipped with powers to deal with the situation. Further, I feel it would not only be very helpful but is an essential preliminary to action, that we should have before us an estimate of the present cost of unemployment to the country. A White Paper setting out clearly and concisely the payments made and the commitments now existing, both in the form of direct payments and guarantees, would go far to show precisely where the country stands in this matter. These are matters upon which we should turn the searchlight of information and, further, we should seek daylight beyond the limits of the present darkness. The recent election convinced us, if, indeed, anyone needed convincing, that unemployment is the vital question of the hour. I think we should not have dared to face our constituents unless we had first examined our minds and consciences, unless we had first satisfied ourselves that we had a true idea of the unemployment problem and that the policy we were advocating was not merely practical, but as complete and extensive as lay within our power to make it.

We are all conscious of the necessity for meeting the immediate needs of the situation. Unfortunately it is a case where generous impulses are tempered by inexorable circumstances, but we must not forget that unemployment is not merely a recurring evil. Hitherto, unfortunately, it has been a normal condition of our civilisation. The Prime Minister stated two or three weeks ago that he was considering the possibility of a scheme of insurance by which industries would carry their own casualties. From my own experience in the election, this statement was cordially welcomed by the country.

We do not know how far the right hon. Gentleman's mind has travelled in this direction. At the present moment we have to cope with difficulties and immediate needs which will exact every ounce of energy and capacity we may possess. Under the present pressure it is no doubt impossible to bring any such scheme, but once that pressure is relieved, I believe there will be no serious or at any rate insurmountable difficulties. In saying that, I have in my mind the outlines of a particular scheme, and I welcomed the statement of the right hon. Gentleman the Minister of Labour yesterday, that he was inviting co-operation and suggestions with a view to establishing an improved system of unemployment insurance along these lines. We Conservatives, I think, can claim to have convinced at any rate a large part of the country of our sincerity and determination to solve this problem, if it is possible. I think we shall not fail. Indeed, we have got to succeed. We are stimulated not only by the urgency of the nation's need, but also by a full realisation of the tragic conditions in which hundreds of thousands of our fellow men are now living. They need more than our sympathy, and I, for one, am pledged they shall have it.


I am sure we must all congratulate the hon. and gallant Member who has just sat down on the lucidity of his speech. The hon. Member for the Hillsborough Division of Sheffield (Mr. W. Alexander) made some references to the question of unemployment which rather reflected upon the party to which I belong. I should like to point out, as a member of that party, that we are in no way responsible for the problem of unemployment as it exists to-day. Unemployment is not a party question. It has not been brought about by any party. It is an unparalleled problem brought about in the first instance by the War. It may have been intensified by the mistaken policy of the late Government, but in the first instance, this great difficulty has been brought about by the conditions which the War left behind. It is not the concern of members of the Labour party alone. We who sit on these benches and, I believe, those who sit on the opposite side are equally interested and are equally anxious to find a solution. I can understand some of the impatience which has characterised speeches delivered from the Labour Benches. We remember that for two years in this House speeches have been delivered on this question, and very little has been done, and we do not want to feel that in this present House speeches, and speeches alone, are going to be delivered. We need to remind ourselves that the real wealth of a country does not consist in the money you have in banks or in any commodities of that kind. The real wealth of a country are the people in it, and you may have millionaires and you may have signs of financial prosperity and yet be a poor country. A country is rich only as it contains happy and contented men and women, and I venture to say that the late Government have made the mistake in the past of looking after the interests of the people in other countries to the neglect of the people in our own country, because the Prime Minister quite recently said in the House that we were in Iraq to-day because of the promises that we had made. What of the promises that have been made to the working men and women of this country? We promised to make this land worthy of the sacrifices that had been made. We were going to unfold wonderful schemes of employment for the people, and houses were to be built for the people, but none of these promises have been kept. We embarked on military adventures in various parts of the world and spent money that could have been usefully devoted to I he purposes of developing trade and finding employment for the people.

I would like to give one illustration that has taken place in the constituency that I have the honour to represent in this House. There are there a number of mining villages where men to-day, who at one time were drawing good wages from a prosperous industry, are out of employment. I refer to the zinc and the lead mines of Cumberland. Shortly before the Armistice was signed, the late Government made a ten years' contract with the miners in Australia, and the result is that they have since then subsidised that industry and closed many industries in this country, including the mines of Cumberland. As a result of that mistaken policy, these people to-day are drawing doles, and I venture to claim for these people that it would be a fair and reasonable thing to treat this home industry in the same manner and on the same terms as the men engaged in this industry in Australia, while it would not cost this Government any more money than it is costing to-day in the doles that are being paid to the unemployed. Many suggestions have been made in this House for the solution of this question of unemployment, including a capital levy, the building of houses, and road making. These are all helpful suggestions, but I think we need to remember that the solution of the problem does not lie entirely along that road. We need to remember that we in this country live, not by supplying the needs of each other, so much as by supplying the needs of the people in other countries, and we can prosper only when the people of other countries are prospering too. During the War the people who were our best customers were many of them engaged in war, building up for themselves great war debts, which reduced their credit and depreciated the value of their money, and much as they would like to buy the goods that we have got to sell, they are utterly unable to do so. It is only when these people are able to appreciate the value of their money that they will be able to come into the markets of the world again and buy the goods that we are so anxious to sell to them.

In response to remarks made by hon. Members opposite, that they want helpful suggestions, I venture to say that if they would consider the advisability, either of the scaling down of these war debts or of their cancellation, they would do a great deal to improve the trade of many of the nations on the Continent. It does not matter to the workers of this country, if they are unemployed, to know that possibly those who succeed us will be able to get something from these countries. What we are losing in unemployment and depressed trade is greater than anything we may hope to get in the future from those countries, and it is not on the ground of sentiment, but as a sound business proposition, that I advocate that we consider the advisability, and the early advisability, of the cancellation of these war debts, in order to help those unfortunate nations again to come into the markets of the world and buy the goods that we in England are so desirous of selling.


I think you know, Mr. Speaker, that I very seldom trouble this House with a speech and I do not intend to take up much time to-day, but, as far as I know, I am the only representative from Scotland on this side who has attempted to speak in this Debate, and I am the more inclined not to give a silent vote to-day because the West of Scotland has figured very largely in the arguments advanced on the other side. The hon. Member for Shettlestone (Mr. Wheatley) told the House the other day that he and his party spoke for the second city of the Empire. I am sure of this, that they do not speak for the business community of the second city of the Empire. I do not represent a division of the City of Glasgow, but the County which surrounds it, and my business interests are in Glasgow, and I never would have been here had I not had the support of a very large proportion of the business classes of Glasgow. I cannot, in the short space of time I have allotted to myself, deal with anything like all the points that I would like to touch upon, but I listened with great interest and satisfaction to the speech made by the hon. Member for the Colne Valley (Mr. Snowden). I did not, of course, agree with a great deal of what he said, but it-was a reasonable speech, and there was no attack in that speech on the system of Capitalism, which was one of the great arguments of the Labour party in the last Election. On the contrary, what he did say, especially about Russia, entirely depended on the Capitalist system.

From all these attacks that have been made on the late Government, one would imagine, to hear some of the speeches, including those of the late leader of the Labour party, the right hon. Member for Platting (Mr. Clynes), that from the very start all the Members on the opposite side were perfectly certain that the Treaty of Versailles was going to be the ruin of this country and of Europe. Well, I was in the House when the then Prime Minister returned from Paris, and I listened to all the Debates upon that Treaty. There was none of these prophecies used then, as one would have imagined there had been from the speeches of hon. and right hon. Members opposite. I well remember most of the speeches from the Opposition side of the House, and I would like to quote one or two of them. In those days I think the right hon. Member for West Fife (Mr. W. Adamson) was Leader of the Labour party, and he said: I think the Peace Treaty terms should be of such a character as will secure a lasting peace. The right hon. Member for Platting said: The terms are very stringent, but less stringent than Germany, if successful, would have imposed upon us. At a later date the right hon. Gentleman used these words: The view I have formed is that the manner and terms of payment have been considered, and due regard has been paid to German liabilities in relation to her capacity. That is an entirely different story from the one we now hear.


The hon. Member must recollect that, speaking from this side of the House, I stated that when the Labour party came into power, all the Treaties, including the Treaty with Austria, would be revised.


The hon. Member is not the Leader of the party. I am quoting from Leaders of the party, and I gather from the Debates that have occurred here that there is nothing like unanimity in the Labour party. A great deal has been said about the destruction that has been done to this country's trade by the reparations, and two particular industries have been referred to. One is the mining industry, and the other the industry I know most about, shipping. I would like to deal very shortly with both, but before doing so, may I say that this question of unemployment was in my mind for many years before the War? I saw an industrial population growing up, and I saw competition developing, and it occurred to me—of course I had no war in my mind then—that the time might come when, because of that competition, and because of a wave of adversity, we might find a large part of our population unemployed, and it has always been a marvel to me that our Governments for years have given so little attention and so little care to the question of emigration. There must be an outlet for our surplus population. It is not an unreasonable pro position, and I do not know why the Labour party always seem to oppose it. Why should people be penned up here in the miserable streets of our cities and large towns? [Interruption.] I have listened attentively to the arguments addressed from the benches opposite, and I hope for the little time I shall speak I shall be listened to also. I am speaking of emigration to our Dominions where there is very fertile land and good climate. I spent a most interesting afternoon in one of the Committee rooms of this House where we had the Prime Ministers of three of the Provinces of the Commonwealth of Australia. I was deeply interested in the statements they made. They wanted a population and were willing to give facilities for immigration. Since then the Government has done a little in that direction, but not, in my estimation, nearly enough. I consider that so long as we are an industrial population and country, we are bound to have this recurrent unemployment. I welcome the suggestion that has been made for industrial insurance. It would not cover the whole question, but I believe it would be a step in the right direction, though I think it would have to be a national scheme, and not confined to any one particular industry.

Coming to the question of reparation, the allegation is made that almost the sole cause of the low wages of the miners and the number of pits that are shut is that this country compelled Germany to deliver so much coal to France, as if we had had the only say. What about France? It was on her behalf, not ours, that Germany was made to give the coal. In the year 1921 we were up against a very serious crisis in the coal industry. The taking off of the subsidy which the Government had for some time been giving to the industry was followed by what I will call a dispute. That dispute continued from March until June, during which time, of course, industries of all kinds were affected and the effects of that dispute are not dead yet. But my immediate point is that it lost us a great many of our markets. What followed? When the men went back to work, and when trade was getting a little more normal, France resumed her imports from this country. Before the War, in 1913–14, France took from us 1,200,000 tons of coal a month. It is said we lost that trade because Germany supplied France with coal. What are the facts? France in the first seven months of this year was very nearly up to the monthly average for 1913–14. The figure was about 900,000 tons per month. France was sending to Italy and to Switzerland the coal from the Ruhr Valley. That compelled Germany to buy from this country, and for the first six months of this year Germany took nearly double the amount of coal she has ever taken from us. Therefore, the allegation that because of the coal reparation the mining industry is suffering here is absolutely fallacious. There is not a word of truth in it.

Let me come to shipbuilding. There seems to be an idea in the minds of the Labour party—I found it constantly thrown in my teeth at my election meetings—that Germany is now, owing to the Treaty of Versailles, engaged in building ships for this country. Germany has never built one steamer of any kind for Great Britain owing to the reparation. What did happen was this. Germany had a very considerable mercantile marine, and was one of our most severe competitors in pre-War times. If, in those days, America was a very small competitor, during the War she managed to go forward, and under normal circumstances she might be a very formidable competitor. Germany, however, was our chief competitor. What happened? Though we had lost about 10,000,000 of shipping tonnage by German submarine warfare, the whole of the tonnage taken from Germany was only in the neighbourhood of from 2½ to 3 millions.

There were three courses open to this country to adopt. In the first place, she might have left that tonnage in German hands. What would have been the consequences of that? Anyone who knows anything whatever about it, knows that German wages and, possibly, the cost of everything else German, in connection with the working of an ordinary steamer, is from one-third to one-half less than it is here. If these ships had been traded by the Germans, it would have meant the laying up of tonnage on our part and the throwing of the men of our mercantile marine out of employment. The amount, after all, laid up in British ports of British tonnage is between 1,000,000 and 1,250,000 tons, but that, I am happy to say, is now melting gradually away. The second course to take was to take these vessels out and sink them. As a ship-owner; suffering from a plethora of tonnage throughout the world, if I had looked only at my own selfish interests and considered what would have suited me best, I should have said, "Sink the lot." That proposal, however, when it was put before the British Government was very wisely turned down, and for this reason: they were able to realise a considerable sum of money from the sale of these ships. Some of them were sold, most in this country, but some to France and other places. It has been alleged that if our ship-owners bad not bought these boats and got them cheaply there would have been a similar amount of tonnage built in our ship-building yards. I can say at once, so far as I am individually concerned, that I never bought one of these ships, cheap as they were. I had no desire for them. No one can accuse me of having profited by the situation.

What was really the case? Ask any British ship-owner you can name, and I think you will find that none of them would have built vessels at the cost then ruling. I took the trouble yesterday to go into the City to refresh my memory on some of these points. I saw the managers of two of the largest shipping lines, both of whom had bought some of these German ships. I put this question to them: "Would you, if you had not bought these German ships, have placed any orders on the Clyde or elsewhere for new vessels?" Their reply was: "You know perfectly well that the price we should have had to pay, about £20 a ton, was an impossible price." It is now down to £10. To say that the German reparation ships have depicted our ship-building yards is just as fallacious as what has been said in regard to coal.

As to the position of shipbuilding on the Clyde—there is a tremendous amount of unemployment—is it a good one? I am not by any means a pessimist. I have always been an optimist—and I am still one. No doubt some of the points put by the other side are true. I may be asked: "What hope is there of any revival of trade?" So long as the costs remained as high as last year, and until very lately, there were no orders being placed, except for some special kind of craft. What has happened? Several orders have been received, and this means several thousands of men on the Clyde are now at work. Under natural circumstances wages and cost have had to come down, and they have come down. What is more to the point, a great deal of the work is being done on piece work, that is, payment by results. With these two things shipbuilders are now able to quote lower prices. The reason, too, why shipbuilders may now get orders is that there is a great deal of tonnage at present owned in this country which is becoming obsolete. Owners are not willing to place an order at an unreasonable price if they can keep their present ships running profitably, but as soon as there is any inducement to put these vessels on the scrap heap and replace them by new tonnage, that will be done. But there are difficulties in this matter, finance for one.

I also spoke the other day to one of our chief engineering heads, a friend in Glasgow, who took a very prominent part in matters during the War, and did very valuable work. I said to him, "How are things with you?" He replied, "I am happy to say we have been able to secure several orders." I further inquired, "How did you do that?" The reply was, "Our men are nearly all on payment by results; they are making bigger wages than they were making before; they are turning out so much work that we are able to quote a price that others are willing to pay, and we are getting the orders." At any rate, these are indications that some trades that have been suffering more than others, the shipbuilding and engineering and the iron and steel trades, are beginning to see daylight. I know other friends of mine, employers of labour, who are actively scouring the country and searching even the Continent for orders, and if they can book them at prices which will cover the cost aid nothing more, they will be glad. The idea that we as employers are callous as to the interests of our men is a calumny. I have worked amongst working men for the last 40 years. I hope I have always done well by my employés. I have men in my employment who have been with the firm nearly as long as I have been there myself, and therefore I can speak with knowledge, as well as with a great deal of sympathy for the men.

The question of unemployment is the most serious question before the country at the present time. I am glad to hear that the Government is doing something. They cannot do very much. No Government can ever book orders if the private individual cannot get them. It is not by-scrapping the capitalist system that you are going to arrive at prosperity, nor is it by setting up a Soviet system or a Socialist commonwealth that you are going to bring peace and happiness. It is going to be by the wholehearted cooperation of the employer and employé and the Government keeping their fingers out of the pie as much as ever possible. We talk about our foreign policy. While there is no doubt it is most desirable and necessary that the world should be at peace if we are to get back to anything like our former prosperity, it is still a long road to travel. We are dealing in some cases with countries that are most difficult countries, and if we wait till we get pacification in some of these areas we will have to go through a very great deal of suffering. My idea is this: that employers and employés should do their best to work closely together.

May I just give one illustration, for the benefit of hon. Gentlemen opposite, of employers trying to do their part? The Minister of Labour is sending out circulars in order to hurry them up to get something done. Here is an instance where the employer tried to do his best. I will give you the instance of a firm on the Clyde, who, finding their yard was being depleted, decided to construct four large steamers on speculation. This was a firm whose benefactions in the interests of their workers have never been questioned. They said to the men, "On these ships we will pay the current rate of wages, but there is one class of men in one particular section who must come down to our terms before we agree to lay down these ships, because we know in times past that they have taken advantage of their position. Therefore we want to know before we begin those ships, on what terms we can depend?"

The terms which the firm were willing to agree to, I am assured, would have meant that any of the men could have made from £7 to £10 a week, but the particular union with which they were connected said, "We are not going to come down to the terms which you have suggested, but we will adopt the same plan as before, and when the time comes to do this work we will make our terms with you." The fact is that those vessels would have been laid down if this one union could have been brought to terms, but that union stuck out against the terms, and the ships have never been laid down. I have not mentioned names because that only gets other people into trouble, but I think I have said enough to enable the hon. Member opposite to identify the firm if he likes, and I know that this firm has nothing to be ashamed of in regard to this matter. I could also give the case of two steamers which were bought to be broken up in order to give employment, and what happened? The men were constantly making new demands on the firm, and the employers at last said, "We are sick to death of all this. Stop the work." Those steamers are still lying there. Is it very encouraging to employers, who are trying to do their best, to be treated in this way? I am giving these instances in answer to the charge that has been made that nothing has been done by the employers to meet the problem of unemployment. That is not the case. However earnest the Government may be in trying to solve this problem, the means which they can adopt are, to a large extent, artificial. We are all trying by individual efforts to meet the situation, and I appeal to the various representatives in this House and outside who are connected with industry, to do their best, because what we are trying to do is more in the interests of the men than of ourselves. I am not asking for any personal gain, but what I am devoting my time to now is to try, as far as lies in my power in the concerns with which I am connected, to get something done which will bring about contentment and prosperity.

2.0 P.M.


The hon. Member who has just sat down promised that he would only speak for a very short time, but he has nevertheless dealt with a very large number of questions. I will endeavour to be more brief. He said at the beginning of his remarks that he was the representative of working-class electors. That is perfectly true, but I would remind the hon. Gentleman that if the Representation of the People Act had been as democratic a Measure as the Labour party would like to make it, someone other than the hon. Gentleman would have been representing Dumbarton to-day in this House. As a matter of fact, the hon. Member opposite has to thank that particular provision, which gives some electors two votes, whereas it only gives to other electors one vote, for the position he holds in this House to-day.

I want to confine my remarks almost exclusively to two points. The hon. Gentleman opposite referred to one of them, and that is, the effect of the reparation policy upon certain industries in this country. The hon. Member said he is not so closely connected with the mining industry as he is with the shipping industry, and I can quite understand why he took the line he did in dealing with this question. I happen to represent a constituency which, to a considerable extent, is connected with the mining industry. I have myself been closely connected with that industry, and I disagree with the view that the hon. Member expressed with regard to the causes of the present depression in the mining industry and the low wages prevailing in that industry. There have been one or two incidents during the past few days which have undoubtedly given hon. Gentlemen opposite grounds for saying that the miners themselves are much to blame for the present position of the mining industry, because, curiously enough, at certain periods we had some trouble in regard to that industry.

The trouble was first noticeable in October, 1920, but I want to remind hon. Members that before that date a certain event had taken place to which the hon. Member who sopke last referred. It was that a certain reparations policy had been imposed upon our enemies, by which they were compelled to sell to our Allies 2.000,000 tons of coal per month, and the trouble really began after that coal began to be delivered to our Allies. The trouble began in October, and I daresay that, during the General Election, hon. Gentlemen opposite used the argument that the trouble in the coal trade was due to the fact that in October, 1920, we had a strike lasting for three weeks. It is true that that strike took place. It was a strike on behalf of the miners for a higher rate of wages, and they were compelled to accept an arrangement whereby they got two or three increases provided that they increased the output during the period that the agreement lasted. Then, again, hon. Gentlemen opposite undoubtedly have ground for saying that the miners' condition to-day is due very largely to the three months' lock-out which took place last year. Whatever idea may be in the minds of hon. Gentlemen opposite, there certainly has been no doubt in the minds of the miners of Great Britain that their position to-day is due almost entirely to the reparation policy which was pursued by the late Government. We on this side of the House are sincerely desirous that that policy should be revised and that an opportunity should be given to the British coal trade to regain some of the prosperity which it enjoyed before that particular phase of the reparation policy was imposed. The hon. Member for Dumbarton (Sir W. Raeburn) spoke as a shipowner. It would be interesting to hear the opinions of shipbuilders on the question of reparation. I venture to say that if the shipbuilders had been as interested in their employés as the hon. Gentleman professes to be in his, they certainly would have opposed any such proposal as that the whole of the German mercantile marine should have been divided among the Allies, thereby imposing upon the shipbuilders and the men engaged in the shipbuilding industry in this country conditions and privations that have been unexampled in our industrial history.

I appeal to the Government to give the same consideration to their employés as the hon. Gentleman professes to give to his. I represent in this House a constituency which is interested, not only in mining, but which has within its borders a Royal Dockyard. As a result of the economy policy of the late Government, the dockyards throughout the country have been very considerably reduced. That of Rosyth has been reduced as well as other dockyards, and as little consideration has been shown by the Government to the men who were employed in the dockyards as has been shown by private employers to their employés. The Government put aside the men who have been employed in the dockyards when there was no longer work for them there, without endeavouring in any way to find fresh work or fresh avenues of employment for them. I appeal to the Government to take a more far-sighted view of this question of employment, so far as they, themselves, are concerned. They should act as model employers. They should set an example to the nation. We expect from the Government a higher standard of conduct that that which is expected from private employers, and I hope, in the future, if the policy which has been pursued in the last year or two is to continue and we are to have continual reductions in the numbers of men employed in the dockyards, that the Government will do something to prevent an increase in unemployment by starting new works or by using the dockyards in a way in which they have not used them up to the present time. I suggest to the Government that alternative work should be undertaken in connection with the dockyards and the other industries for which they are responsible. We have enough to do in the industrial field to find employment for the men who from time to time are thrown out of work, without the Government adding to the problem by displacing men from the Royal Dockyards.

The problem has been discussed in a very friendly and sympathetic way from the other side of the House, and I hope that we are going to see that spirit developed during the next few months and that a serious effort will be made to find a cure for it. I am afraid that the proposals which have been put forward by the Government are not proposals which will cure the problem. As a matter of fact, they are mere palliatives. They are meant merely to find employment for a few thousand men, or at most, 200,000 men. An enormous number of men and women are to be left unprovided for so far as work is concerned. I hope that a more earnest endeavour is going to be made to find work. It is work that we want for the unemployed, not doles, and I hope that bigger schemes than those which have been outlined by the Government are going to be undertaken, so that we may find work at remunerative wages for the unemployed of this country. I would, in my closing words, appeal to the Government to make a serious endeavour to end this problem. We on this side of the House wish to get rid of it. We do not wish to go on year after year making speeches on the question of unemployment. It is no pleasure to us to discuss unemployment. We wish to see every man and woman in this country willing to work provided with work that will give them wages which will keep them in decency and comfort.

Lieut.-Colonel CROFT

The House will agree that no Debate has been conducted in this House with better feeling on all sides. That must be an indication to everyone that this is not a problem which concerns any one section of the House, but is one in which all parties are equally interested. I must not detain the House at any length, and I cannot therefore -deal with many of the arguments which have been advanced. I will only say this, that when my right hon. Friend the Member for Spen Valley (Sir J. Simon), speaking for the senior branch of the Liberal party, told us yesterday that he was much concerned with the fact that the late Government had not done more to provide against unemployment in the good times of trade and employment, one could not forget the fact that the right hon. Gentleman himself was in this House for a very considerable time, and one mu6t express regret that, holding that view, he and his colleagues did not find some opportunity for providing for the evil day.


The personal point is of no importance, but I rise on a matter of accuracy. I was not a Member of this House from 1918 onwards, and it was the period 1918–1920 to which I was particularly referring.

Lieut.-Colonel CROFT

I was referring to the long years before, when the "Wait and See" policy was in vogue. But I do not want to make a party point. One must admit that there have been very few constructive proposals put forward in this Debate. I believe, however, putting aside all the palliatives which have been suggested, we could do more to cure unemployment if it were possible to get rid of the present burden of taxation and allow the money to flow through the various channels of industry. That, however, is not possible at the moment, although I hope that, under the present Government, something may be done in that direction. I would ask the House to concentrate on a proposal of more permanent value, not only to the unemployed, but to the country at large. Admittedly, the late Government had the question of unemployment very much at heart, and my right hon. Friend the Member for North-West Camberwell (Dr. Macna-mara), who was responsible for the Labour Ministry, will agree that hundreds of million pounds were poured out in the most generous manner—in a manner in which no other country in the world has ever attempted, or is likely ever to attempt, in order to solve this problem. It must be observed that the more money that is spent in non-productive ways, the greater ultimately is going to be the difficulty of recovery from taxation, and of bringing about prosperity in industry. We can all of us approve the idea of the Labour party that Micawberism is of no use in this connection. We must regard unemployment as a permanent evil in our midst. We have to realise hard and brutal facts. We have to really tackle this question almost as we tackled the great problems of the War. There has never been anything like it before and I am afraid things are likely to get worse, even if trade improves, rather than better in connection with unemployment. I want to remind the House of two facts; first, that since the War there have been two million persons fewer emigrated from this country than would have been the case in a like period prior to the War. That is a very important fact. I estimate further that the natural increase in the population of this country means that there are more young men coming into the ranks of industry than were actually killed during the War. Putting these two facts together, I suggest I am stating a moderate figure when I say there are now about 1,500,000 more persons to be absorbed in industry than was the case in 1913.


No, not so many.

Lieut.-Colonel CROFT

I have pointed out there are 2,000,000 who, under happier conditions, would have emigrated, and from these we may deduct the 700,000 killed in the War. That leaves consider ably over 1,000,000 and to that figure must be added the natural increase in the population during that time—


And the unnatural decrease.

Lieut.-Colonel CROFT

I have already allowed for that. I am content, however, for the sake of argument, to accept a lower figure, and I will say there must be 1,000,000 more persons to be absorbed in one way or other in industry in this country than would have been the case if the natural flow of emigration had gone on and if the increase of births over deaths had not been so large as it is. It will be admitted that the number of births over deaths represents about 300,000 a year, which means that in 10 years' time we shall have a far bigger number of people to consider with regard to employment even than at this moment. If you cannot reasonably hope to absorb this vast proportion of the population of our country in industry, then you must take the Labour point of view and say that every man must either have work or maintenance. That cannot be secured unless you are going to bring in something on a gigantic scale, and you will probably have a charge for maintenance of £300,000,000 per annum for 10 or 15 years. That, of course, means bankruptcy, and to avoid that we must look ahead in a way we have never done before. This is not, a party question; it is a great human issue. I am going to put my point very briefly before the House without any endeavour to make any party capital whatever. If you cannot hope to absorb this population, if you have no employment for the men, they must be found a place in the sun, not only where they can exist, but where they will have a real chance of employment. I have never contemplated anything in the nature of forced emigration. I would even say, do not try to persuade a man to emigrate against his natural instincts; but I do suggest that if amongst this great army of unemployed there are young men with big enough hearts and courage to go and seek a living overseas, then in Heaven's name let us give them the opportunity and make the most generous provision to that they may once more have the ladder of progress placed at their feet. We have to look overseas to the vast vacant spaces in the British Empire for the fulfilment of our hopes. There, at least, men will move from home to home. They will remain under the same flag, the same laws and the same civilisation. When I listened last night to the speech of the right hon. Member for West Swansea (Sir A. Mond), who has become such a burning convert to the idea of developing the Empire in the last few years, I could not but feel surprised at his moderation. I wondered indeed that he did not go far further than he did.

The second point that I should like to put before the House is this. It is generally agreed by all parties in this discussion that we must find new markets and new customers, and I was surprised that the right hon. Gentleman the Member for Platting seemed yesterday to attach so little importance to the Empire side of this question. When my right hon. Friend the Member for Colchester (Sir L. Worthington-Evans) referred to that to-day, the right hon. Gentleman the Member for Platting was a little indignant that the House should have been led to think that he did not attach very much importance to the British Empire. I must, however, remind him of his actual words. He said yesterday, referring to the proposal of the Prime Minister for developing Empire trade: It is a comparatively secondary consideration. [HON. MEMBERS: "NO, no."] I say that I do not belittle it, but set it side by side with that great world trade which a manufacturing nation like this must continue to do with other parts of the world, and it is indeed a minor consideration."— [OFFICIAL REPORT, 30th November, 1922; col. 949, Vol. 159.] I must remind the right hon. Gentleman, who is one of the leaders of the Labour party, that he is not informed of the facts, and I do think, in view of the position in which we are, that we ought to inform ourselves of the facts. He referred to the smallness of the population in the Empire. True, but for every £4 that we are exporting to foreign countries, we are exporting £3 to the British Empire overseas. Again, taking the case of Europe alone, it will be found that we are exporting to the four great dominions of the British Empire £110,000,000 worth of goods a year, whereas to the whole of Europe, excluding alone France, we are exporting £100,000,000 a year. That is not the only point which the late leader of the Labour party pressed upon the House. He said that there are only some 20,000,000 white inhabitants of the British Empire. Why the Labour party should divide the Empire up into white and black I do not know, but the fact remains that one-quarter of the population of the world is under the British flag, in markets which are most readily able to expand. The right hon. Gentleman forgot that these 20,000,000 whites in the Dominions are buying every year in pounds per head, as against shillings and pence in the countries of Europe which are, unfortunately, derelict. He might have told us, for instance, that in the four great self-governing Dominions they are buying from us at the present time to the extent of £6 15s. 6d. per head, whereas other countries are buying from us, on an average, only to the extent of 19s. 1d. per head. Therefore, if it be true that we must find new markets, what more fruitful and profitable markets can we find than those of the great Dominions under the British flag?

That brings me very briefly to a question of policy. We have had the Empire Settlement Act, which was a step in the right direction. I have not very much good to say of the late Coalition, but I will say that I think that was a sound Measure. It was, however, rather of the nature of a pill to cure an earthquake, and I think we want bold Measures at the present moment, Measures on a grand scale to meet a terrible danger. At the present moment we are spending £100,000,000 in relief in one form or another—and I agree that we should not talk about doles any longer, because it is not fair; it is a case where every man has been contributing—but from a reproductive point of view we are throwing that £100,000,000 away. I want to ask the House to invest it. That is the difference in policy. The Prime Minister, whose mind has never been confined to narrow channels, but who naturally, as the result not only of close association but of instinct, always considers these questions from the wider Imperial point of view, is calling the representatives of the Empire together, as I understand, in an immediate conference. I hope he will honour me by considering for a moment or two the plan which I have to put before him. It is that he should boldly ask the Prime Ministers of the Empire to give him country—vast tracts of territory—in each of the Dominions, with an option of developing that territory for 30 years or else returning it to the Dominion Government. I suggest that those territories should be territories away from existing vested interests of either capital or labour.


Why not distribute the home lands?

Lieut.-Colonel CROFT

We can talk about that another day. I am quite prepared to do so, but I do not want to delay the House. What I suggest is that new colonies of settlers should be formed in undeveloped territories in the old Dominions, and that, if the Dominions will give the land, the mother country will provide a host, if they desire to go, of new settlers for the permanent enrichment of those Dominions. As a first step I suggest that Great Britain should finance the building of the railways in those new territories. [An HON. MEMBER: "Where is the money to come from?"] I will show the hon. Member if he will listen. I suggest that this money should be advanced on condition that the rails are made in British factories, and that also, if possible, 50 per cent, of the rolling stock should be made in British factories, and the other 50 per cent, in Dominion factories. That would bring immediate orders to Sheffield and the other great iron and steel districts whose sad story we have heard to-day. Those railways would be built through the gift territories of potential agricultural land. We could not supply at once a vast population of agriculturists, I know, though we could provide a good many; but we could send out, even if it were only for a matter of two or three years, large numbers, say, of bricklayers, bricklayers labourers, plumbers, painters, and all the men connected with the building trade, in order to run up stations, elevators, and warehouses, and build the villages which will ultimately expand into towns and cities along the line of those new railways.

The land along this railway frontage would be divided into sections for small farms, all fronting the railway, with an increased land area in rear kept in reserve in case the settler desired to expand his holding of land, finding that he was successful as an agriculturist. All these farms would be provided on easy terms of land purchase spread over 10 years, the purchase price to include the original ploughing up of the virgin soil for the first year, which would be carried out by the Government on the advice of the Dominion authorities on the spot. Every worker, agricultural or otherwise, would have his complete passage money paid and work guaranteed for him on arrival within the new settlements, but there would be a small levy on his wages, spread over five years, so that that amount might be repaid. I suggest that there might either be a temporary loan or, if the policy was found successful, there could be a longer loan. The right hon. Gentleman the Member for West Swansea, with bated breath, last night spoke about £100,000,000; but we are wasting £100,000,000 a year now, and it will be found that the money can be easily provided with the land as security behind it, and the increment value will be developed as you go along.

It may be asked, where do the Dominions come in? I would answer that, where the railway has been built, every third plot of land should be held for the Dominions themselves to develop and to sell at a later date. You would give them an army of new taxpayers, you would be creating a great demand for their timber, bricks and other housing materials, and you would immediately add to the prosperity of the Dominions as well as of this country. I believe we have got to face the fact that we can never absorb our unemployed in this country unless we assist, in some manner such as this, at least 200,000 young men every year to go to the Dominions. An hon. and gallant Member says that there must be more. I say that there should be that number in addition to any chance emigration which may occur, but I believe we shall have to organise for 200,000 men a year going out. That can only be done if it is organised on a large scale. What does the adoption of such a policy mean I It means that, whereas the wheat consumption of the world is overtaking wheat production—the Eastern peoples of the world are becoming wheat-eating peoples, presently to absorb a, vast amount of the wheat of the world, while the United States also is practically no longer a wheat-exporting country, but has to buy wheat and import it within its own shores —you will be ensuring the wheat supplies of the people of this country and of the whole world in future. At the same time it means more work for British factories, it means a boom in the iron and steel trades, it means a boom in the shipping trade, and it means new life and new hope for a vast number of the workers of this country. I believe it also means, what is more important still, a real and lasting partnership within the Empire which is going to be of inestimable value to all the partners concerned. For these reasons I hope the House will consider the scheme and will do its utmost to regard it, not as a question of paying out a little money, which is merely going to have the same effect as if you scratched the coat of a sick elephant when it is suffering from an internal complaint, which may be very soothing, but does no good in the long run. I believe you have to think, not only in millions, but in hundreds of millions, and that the money is going to be returned at an early date to the taxpayers of the country.


The time that remains for the conclusion of the Debate on this Amendment is so limited that I shall not ask the attention of the House for more than a very few moments, and I shall spend very little of it in anything like an examination, either in their general scope or in their details, of the schemes which were so lucidly brought before us last night by the Minister of Labour. I think it was a very admirable example of the art of Parliamentary exposition. But the right hon. Gentleman showed, I think, prudent reticence in not giving the House any estimate, even of the vaguest and most general kind, of what proportion of the 1,300,000 persons now out of employment would, under those schemes, if they were carried into effect, be in receipt of work and wages. However admirable they may be in conception, when they come before us, as they will in due course, after fuller consideration, for I hope close scrutiny by the House of Commons, it is quite obvious that in execution there must be difficulties and delays. There is the task of selecting which among the unemployed you are to choose for each particular scheme, questions of transport and of housing and a hundred other miscellaneous and incidental details which make me pause before I can take anything like a sanguine estimate of the immediate or the prospective future results on the problem with which we have to deal. The hon. Member for Colne Valley (Mr. Snowden), I understand, in a speech which greatly impressed the House, and which I am very sorry to have missed, estimated the total amount, measured in terms of men obtaining additional employment, which these schemes will bring about, at something like one-sixth. That is a very melancholy instalment for this House to be asked at this time of day, after the experience of the last two years of that which is, after all, the most urgent and formidable of all our social difficulties. I do not propose to occupy the time of the House to-day with any examination of these remedial measures. They are not put forward as correctives, still less are they put forward as preventives. The utmost that is claimed for them is that they are reasonably adequate palliatives, I will hot say to meet, but to mitigate the stress of a pressing emergency. That is, I think, the utmost claim which can be made for them.

I should like to look at the wider and deeper aspects of this matter. The kind of unemployment we are witnessing today is different, not only in degree but in kind, from that which we have experienced in the past, and which has become almost a regular incident in the cyclical movements of industry. My right hon. Friend the Member for West Swansea (Sir A. Mond) said last night, very truly, that under normal conditions we are a great exporting country. So we are. But we are not only a great exporting country, but what follows from that, what, indeed, is incidental to it and consequential upon it, we are a great importing country also, and though what we produce for home consumption is not by any means so inconsiderable a factor as some people think of our total production, there is no country in the world —I am stating a commonplace, though one that is often left out of view—which is 60 dependent upon and so sensitive to the conditions of international trade. Until international trade—and I use the word in its broadest sense as including markets, currencies, and all the rest of it—is put upon a stable foundation, we shall continue to be of the nations of the world the chief or among the chief sufferers. That is the real key to the problem of unemployment. A great deal has been said by the hon. and gallant Gentleman who has just sat down—he will excuse me if I do not at this stage go into details of his very interesting scheme—and by others, very naturally, about the importance of finding and developing new markets, and especially markets within the confines of our own Empire. I am all in favour of that. Like many of my friends, I have never said a word of hostile criticism or even of discouragement in regard to such schemes. I am all in favour of them, provided—it is a large proviso: I am not quite sure that here I shall have the complete assent of the Prime Minister — that the measures adopted in pursuit of them are economically, financially and fiscally sound. It has always to be remembered that international trade is not carried on in compartments, Imperial or otherwise, ethno- logical, geographical or political. It is not a mere matter of direct exchange and barter between country A and country B. It cannot, if I may use the expression, be canalised. For this purpose—and this view was well expressed by the late Prime Minister a few months ago—the whole world, with its infinite variety both of resources and of needs is one, and you cannot sterilise or paralyse production over any considerable area without injuriously affecting, in a greater or lesser degree, sooner or later, the whole of the rest. This may sound like an abstract proposition, but it has a very direct bearing on the problem which is raised by this Amendment. It is that paralysing and sterilising of large areas of production and of possible interchange that has happened during the last eight years, and is still happening to-day.

Let me analyse it. We had, first of all, four years of war, with its enormous destruction of fixed capital and of human life—which is, after all, the main and the vital instrument of production—and with its unexampled diversion of wealth, both of accumulated wealth and current profits, to unproductive purposes. That was the price, the inevitable price, which the nation had to pay for playing their part in this gigantic struggle, and I for one, and I hope the House, and I believe the country, will not regret that we were ready to face that enormous task. That was the inevitable price of such a war. What has been our history in the four years since the War? I venture to say, speaking from the economic point of view, that it has been one of progressive unsettlement. I use the word "progressive," advisedly. It has been progressive because, from the nature of the case, if nothing effective was done during all this time the tendency was every year and every month to go further back.

I will say nothing except a few words on the territorial arrangements which were made in the Treaty of Versailles and in the other Treaties. I reiterate the opinion, to which I have often given expression, that when you were breaking up, as you were bound to do, the great autocratic Empires, to some extent Russia, and the whole of Austria, and substituting for them a number of free autonomous States, it ought to have been remembered, but it was forgotten, that with all their demerits, these great Empires, Russia and Austria, were, for fiscal, financial and trade purposes, economic units within the boundaries of which there was complete free intercourse and interchange. It was a mistake, in my opinion a disastrous mistake, I hope not a fatal, irreparable mistake, not to take, as the statesmen and diplomatists at Paris might easily have taken in advance, safeguards against the erection of tariff wads, of military organisations and other artificial obstacles against free interchange and uninterrupted transport. That is too often left out of view. In my opinion, over a large part of Central and Eastern Europe, where conditions of industrial paralysis exist, a large part of the paralysis ought to be set down to the lack of foresight and prescience which characterised that aspect of the new territorial re-arrangement of Europe.

I do not lay so much stress upon that aspect as upon the last point which I wish to impress upon the House, and in regard to which I should like to have an expression of opinion from the Prime Minister on behalf of the Government. Over the whole scene, over the whole economic area of Europe, there still loom two spectres, reparations and indebtedness, and until they are laid, and finally laid, the prospect of restoration to anything like economic stability is hopeless. It is an idle dream. [HON. MEMBERS: "Waste!"] Worse than waste. My own view as regards reparations and indebtedness has been frequently expressed. It is well known to all who care to know it, and I should be wasting the time of the House if I were to repeat it, even in the most general terms. I want to put a question to the Prime Minister and the new Government—a Government which, I hope, from an expression which the Prime Minister used the other night, is not trammelled by the fetters of the Balfour Note, one of the most unhappy diplomatic adventures which we have seen in the last four years. I trust and believe that the Government in these matters has a free hand.

We are told, and I am very glad to know it, that M. Poincaré, and possibly the Italian Prime Minister, are coming over here in the course of the next few days to enter into counsel with my right hon. Friend before the Brussels Confer- ence assembles. I do not ask—it would be unfair to ask him, until he has had an opportunity of conference with the representatives of these friendly countries, our old Allies—to make a definite commitment. But I do say, and I believe that I can make the appeal not in any party sense, but as representing the great bulk of opinion throughout the whole commercial community of this country, certainly the Liberal party and the Labour party—if I may presume for a moment to say so; I do it with bated breath; I may be repudiated, but I do not think that I shall be—I believe that I can say for them as much as I can for ourselves and, what is more, for the people who are not separated by party divisions or bound by party affiliations in every part of the country, that, until there is a definite ascertainment and final liquidation of all these claims, involving as it must, on our part, not a very heavy sacrifice, but the abandonment of imaginary assets, you cannot have economic stability, for it is on those lines and on those lines only that you can lay the foundations of a system of economic stability, of international interchange which, until it is established, will make unemployment in this country not only a temporary, but a chronic evil.

The PRIME MINISTER (Mr. Bonar Law)

With a great deal of what my right hon. Friend has said I am in agreement and, most of all, I can assure him that he can rely on it that I shall bring forward no Measures which are not economically, financially, and fiscally sound. But I shall at this moment attempt no definition. My right hon. Friend dealt mostly with the economic aspect of this question as did also the hon. Member for Colne Valley (Mr. Snowden) whom, if he will allow me to say so, I congratulate on his speech, and whom we are glad to see again in the House. The condemnation of the hon. Member for Colne Valley was even more strongly marked than that of my right hon. Friend. But I would like to point out, even to him, how much more difficult this problem was then than seems to be imagined now. Anyone would have agreed five years ago, as we all agree to-day, that the economic division of the Austrian Empire cannot be a good thing. But my right hon. Friend said how easy it would have been to have arranged that at the Conference. At that time there was nothing in the minds of all these small nations so fixed as the idea of self-determination, of which my right hon. Friend has always himself been an advocate. And how difficult it would have been to get them to abandon the idea of fiscal independence was proved conclusively by what we have found when dealing with the case of Ireland, though there is nobody who will not be convinced that it would be good for Ireland and the United Kingdom to have a common fiscal system.

But I now want to deal with another aspect of the case. I feel as strongly as anyone in this House that, so long as there is this cloud of uncertainty over Europe and the world, we cannot get stable conditions; and it is certain that any man standing at this bench, whatever party he represented, would say that the one object which he had in view was to secure peace throughout Europe. We all desire that. But the ideas a6 to the faults which have happened in the past are very much astray. For example, it is assumed now by my right hon. Friend and his colleagues that it was only those who supported the late Government who were bent on this big demand of reparation from Germany. My right hon. Friend was not himself in the House, but in February, 1919, on the Address, my right hon. Friend Sir Donald Maclean, who then represented that party, and whose absence we deplore, said: So far as I was concerned I was most heartily in agreement. There was first, punish the Kaiser, and the other was make Germany pay. There is no good saying to-day that now it is all our fault, when it is evident that that party had held the same view as we did. But are Members of the other party opposite in a better position? May I read the words of the hon. Member who was then leading the Labour party. He said on the introduction of the Treaty: With reference to the terms of this Treaty, Labour has always insisted that Germany must make full reparation for her wanton destruction done in all the Allied countries.

Captain O'GRADY

You put in things that they cannot pay. That is the difference.

3.0 p.m.


That is not the attitude taken in Debate. I am not sure, that the hon. Member represents his party, but his idea clearly is even now that we should not take any reparation. We want peace. Certainly the last Government and this Government were trying to carry out what has been the universal practice of the British Empire—that when War is over, we get peace with our enemies. We all desire that. But now just consider the suggestion put before us. It really means that we are to pay our debts abroad —which are a large sum—and that we are to give up all debts due to us, we are to abandon all hope of any reparation from Germany. It is obvious, in view of the meeting to which my right hon. Friend referred, that I cannot say any thing to prejudge what we shall do one way or another. What I would like to point out to him is that it does seem to me, and I think it ought to seem to every Member of this House, a very curious result of the War, in which we have sacrificed so much and out of which we came victorious, that we should be the only one of all the nations who should pay an indemnity.

I am not prejudging this question, but when hon. Members say that it is impossible to get payment from Germany at all, I would put this to them. The Allies were victorious. German factories, German mines and interests of that kind were not touched. Those of France were almost destroyed. Is it really reasonable to suggest that some reparation should not be made for this destruction by those who made it? Now we are told that it cannot be done. I do not think it is worth while arguing the matter very closely, but it is worth while to point out two simple facts. An hon. Member on the Opposition side said that the ships we received from Germany were the cause of unemployment on the Clyde, the Tyne and the Wear. I am not a shipowner, but I believe one of my hon. Friend? has spoken on this subject to-day. If there be any trade in the world which is international, it is shipowning, and it seems to me to be an absolute certainty that, whether these ships had been run by Germans or by Britishers, they would have had precisely the same effect on the freight market, and precisely the same effect in preventing the building of ships. That is so. Before the War, as everyone who has any interest in the subject know s, European ships were competing in the trade of the Empire. Norwegian ships were employed, and so were German ships. Precisely the same thing would have happened after the War. What prevents the building of ships is a surplus of ships, not necessarily owned by one nation only, but by all nations. Freights then are so low that the building of further ships is not encouraged.

Look at another aspect of the question. We are told that the Germans cannot pay because they must pay in goods, which is true. But what does that mean? Does anyone suppose that, when Germany recovers, there will not be an export trade from Germany? As my right hon. Friend the Member for Colchester (Sir L. Worthington-Evans) pointed out, it surely would not be unfair, on the assumption that it is right that they should pay something, that there should be in one form or another a tax on these exports. It has been said that, in order to pay the indemnity, Germany will be forced to sell these things at a very low price. II that be really the case, what it amounts to is that, if you put a very heavy tax on the industry of any country, that country will beat every other in competition. If that be true, it looks as if we could very easily put ourselves in a position to rival anyone else.

I have very limited time, but I am going to divide it with the hon. Gentleman opposite. I shall try to deal with some of the more general aspects. When I read the Amendment, I was a little surprised at its wording. I have been a long time in the House, and it was not difficult for me to find the explanation. In one of the earlier Debates on the Address I expressed the hope that the various oppositions might cancel each other. This Amendment is formed with the idea of defeating that hope; it is worded in such a way as to bring them all into the same Division Lobby. I do not object to that. But perhaps the words of the Amendment afford an explanation of the difference between the speeches on the first two days of the Debate and the speeches of the last two days.

I, personally, have been interested in this Debate all through. I was most interested on the first day. I listened, not with any displeasure, but with great interest—and though it is difficult to believe—with some enjoyment, to speech after speech from hon. Members for the second city in the Empire, who spoke in a language with which I was very familiar. It seems to me at the time that some of them were almost angry because, in the course of a single afternoon, they did not convince us that two and two make five They realise now that it will take a long time to make that conversion. These speeches were all good, some really eloquent, and I quite understood how we had lost our seats. The difficulty with them was this. As long as they were describing the evil conditions of the present time, they were on perfectly firm and strong ground. I listened to every one of them. But when they come to the time when they are going to tell us the exact remedy, the speech breaks down. Obviously, that is not so easily noticed by a platform audience. Therefore I can understand their success. [An HON. MEMBER: "That accounts for your majority."] Possibly. Since the whole form of the Amendment has been changed, and there is no suggestion now that the way to remedy the present evils is to upset our whole system tomorrow, it is obvious that I ought to devote myself to a consideration of what can be done under the present system.

I was greatly interested in noticing that two or three of these speakers, and the hon. Gentleman who resumed the Debate this morning, came pretty near the same thing. They seem to have an idea that everything can be put right by the proper use of the land. I was reminded in many of these speeches of an experience which I went through regularly when we were discussing on the platform the fiscal question. I had to listen frequently to chairmen who were introducing me, and who were very enthusiastic, but who had not devoted much study to the subject. They all started with this idea: "We are going to be a self-contained country, surrounded by a wall, keeping every competitor out." That really was the idea of many of these speakers. They tell us, "You can get all you want by proper cultivation of the soil and by co-operation." It is a fact that our lop-sided system—the extent to which we are industrialised, and the small extent of our agricultural population—is at a time like this the cause of greater suffering here than in other countries, and undoubtedly if it were possible to do anything to remedy that on the lines of our general policy, there is no reform which in my opinion would be so important.

Let us follow this argument. Once you have got land suitable for wheat under cultivation, and you come to land not so suitable for it, any economist or anyone who has studied the question will tell you that when you come to that less suitable land, if you got it for nothing, if you had no rent to pay, it would be utterly impossible to produce food in competition with the food from the rest of the world. See where that leads! You could, of course, go on producing it at this high price, but whatever population were engaged in the industry, owing to the high price of the cost of necessaries, would be absolutely out of any foreign market. We could not export at all, and the consequence is that if anyone aims at that ideal it comes to this—and perhaps it will be accepted more readily if I quote the words of Mr. Wells, a Labour candidate, who said in Manchester: But a country which can carry 60 or 70 millions of people on a modern industrial organisation cannot carry more than 10 or 12 millions if you are going to have it on a peasant basis. I will add something more. I am certain of this, that judging by the past 20 years, and admitting all the hardships, our workpeople as a whole have had a far more human life in this country than is to be found in any peasant State of the world. Let me take another point. Hon. Members say over and over again, "You were able to raise any number of millions during the War," and they add, "There is a fall in wages of £500,000,000, and if we had that there would be no unemployment, because there would be the buying power." One hon. Gentleman who spoke from the Labour Benches last night absolutely amazed me by the statement that the difference between the two parties, his and ours, was that we wanted low wages and they wanted high wages. There is nothing more absurd than that.

I am not an employer, but I have always said—I am not saying something new— that the ideal at which we should aim in this country is that the workmen should get the biggest share of the industry that the industry will stand. Where is the £500,000,000 of wages to come from? It is obvious that it can only be in one of two ways—by profits in the industry, or by taxation or borrowing, and in no other way. It is quite true that we raised these enormous sums during the War, but we raised them by a method which now lands us with a debt of £7,000,000,000. We could go on doing that as long as people would lend, and I am convinced —I am not saying something new; I said so during the War—I said in the War that our employment troubles would come, not while the War was going on, but when it ended, and we had balanced our Budget and ceased to borrow. That is what happened, and we are paying for it now.

I have not myself the smallest doubt that, if we had made what is called "deflation" slower, there would not have been anything like the unemployment there is in this country at the present moment. I have not a doubt about it. I was responsible for the heaviest taxation of all, the 80 per cent. Excess Profits Duty. But I think we were right, and I think so for this reason, that we are going through troubles now which nations that have not faced their problem have got to go through later. But, believe me, this policy which we have adopted has had some very grave evils. I know hon. Members opposite think that any amount of taxation on capital does not matter. Perhaps, there are one or two who think so. [HON. MEMBERS: "On wealth!"]

I can assure those hon. Members that it is an undoubted fact that the money taken by the Excess Profits Duty is the reason that industry after industry in this country is unable to expand to-day, because they have not got the money, and not merely that they have not got the money, but that they have not got the credit from the bankers. It is a very serious handicap. There is another thing. It has given people abroad the idea that, because our central financial position, the balancing of our Budget, is so good, we are far stronger than we really are. The money that we have put in balancing our Budget has been taken out of what would have been the savings available for the expansion of industry, and it is perfectly possible— I believe it is true—that, if you look at the amount of our unemployment, and the cost of it, we are probably suffering more to-day than, or as much as, any of the Allies who won the War. It is obvious that it is no good to talk about "acting in peace in the same way as we did in War." We cannot go on piling up debt. We must pay our way, and it cannot be done in that method.

There is another subject upon which I should like to speak. An hon. Gentleman talked about sympathy. I think there is a general feeling in the House to-day that it is not confined to any one class. If I cannot feel the problem as acutely as the hon. Member who told us that a month ago he was receiving the benefit dole, or the hon. Member who described how he hunted for work when his children were little, it wants small imagination to realise how terrible that evil is; and if there be any difference between us, it is not so much that we wish to keep the better share we have got—although, naturally enough, we should hesitate about giving it up—as that we really believe that the remedies proposed would make the case far worse.

I am going to say very little about our proposals. It has now, I think, been admitted by nearly every speaker that, taking into account our system, the late Government have a right to claim that they have done far more than has ever been done by any Government in the world. When we came to deal with the subject, I started with the knowledge of the tremendous effort that has been made, and, at the Election, I said that the Government had done splendidly in regard to this problem. We have looked into the schemes, and have made some additions to them. They are not very Large I admit. We looked into the subject of arterial roads. I think it is a way in which money could be most usefully employed. But we found that not a penny of it would be available for wages in the coming winter, and in those circumstances it seemed to me clear that it was a question to be considered later, in view of the following winter. But there is one thing for which we have tried to make provision.

I believe that what is wanted to restore trade is confidence. I hope that that might do something for the country. I did believe that. The first condition of improvement is to get into the minds of the business people of this country that there are not going to be surprises, and that is our aim. We are more likely to help matters by looking after the things which we can control than in any other way. But there are things that do not depend upon us, and which might at any time throw the whole prospect out. Still, I do believe that there is now a real chance of improvement It was stated the other day that I was seeing the railway directors. There is nothing particular in that. I am sure my right hon. Friend the late Prime Minister, had he been in my place, would have done the same. What was my object in doing so? So long as prices seemed so high that it would not pay business men to do work that did not need to be done, I could not expect them to do it. But I put it to them —and I think they agreed—that it looked as if we had got, if not to the bottom, very nearly to the bottom, and therefore it was advisable, in the interest of business, in the national interest, and in view of the state of things, to anticipate. I think they agreed. See how far that goes. If you can get employers generally to accept and adopt the belief that, having got to the worst, or nearly the worst, there is going to be an improvement, that in itself will cause the improvement. The price of any commodity at any moment does not depend on the law of supply and demand at that moment. It is psychological. It depends on what people think it is going to be in the near future. If you can once get the idea established that there is a chance of improvement, that in itself will go a long way to cause it.

In that connection, let me say a word or two—I will not be more than a few minutes more—on the question of more work in the Empire. I wish the House to feel that this is not a question of fiscal heresy. I have pledged myself on that subject to do nothing in this Parliament fundamentally to alter our fiscal system. The right hon. Gentleman opposite treated this as a question of figures. He took the number of the population in Europe, and compared it with the number in the Dominions. Was not that putting it very widely? It is not a question of the numbers of men who might possibly be our customers; it is a question of the men who are our customers. Let us take the central portion of Europe. I believe the House, and, I think, some hon. Members, know how the matter stands. But let me give again what I think I have told the House before. The value of our trade before the War with the Dominions, with a population of 17,000,000, was over one-third of our trade with the whole of Europe, with a population of 436,000,000.

Let me give another figure. In 1913 our exports within the Empire were two and a half times the size of our exports with all the disorganised countries of Central Europe and the Near East, including Germany, Russia, Turkey, and the rest. In 1921 it was not two and a half times; it was four and a third times. In 1913 our import trade with the Empire was one and two-fifths of our trade; in 1921 it was nearly five times as great. What is the explanation of that? There is no mystery about it. Trade, however bad the conditions, if it be left to its own devices under the wicked system of private enterprise, will find some means of making the best of bad conditions. What has happened? We used to buy immense quantities of food and materials from Russia, but now we get them largely from other countries. Not only this, but the buying power has been transferred to other markets, and it is there that we must look for improvement. It is not really a question of putting the Empire first, or other countries first. We have to put Europe on a right basis, as we all desire. Nothing however, could be worse for you than to give the impression that there can be no improvement until Central Europe has been put right, because that is fatal. There is a possibility of immense improvement, and it was not for electioneering purposes that I was going to call an Economic Conference. I do not believe it is necessary to have this £100,000,000, but I am not afraid of a little inflation. That is the kind of thing for which I hope, and I can assure the House that in my belief it is in that kind of method that the only real hope lies of our getting out of this terrible condition.


I propose to detain the House for a very short time and, in doing so, I shall attempt to concentrate its attention upon the business before us. The right hon. Gentleman who has just addressed the House said, with very pardonable pride, that he listened on the first day of this Debate to the wonderful incursions of Glasgow Members. He said that he was charmed by their accent and delighted with their descriptive arguments, but he thought that when they came to practical proposals they completely broke down. Assuming that is true, they have, at any rate, an advantage over the Government, because not only are the proposals for dealing with this problem made by the Government very bad, but their description of the evil is also very bad. They not only break down on their practical proposals, but they fail to appreciate the nature of the problem.

Take the question of Empire trade. The Prime Minister and those who have spoken from the opposite side of the House seem, somehow or other, to assume that they ought to lecture us on this side as if we were heretics. We want to develop the trade of the Empire, but also the trade of the world, and the only caveat we put in is that, in developing Imperial trade you do not adopt a principle, either economic or fiscal, which will hamper you in getting your proper, natural and just share in the trade of neutral and other foreign markets. I do not know if the definite proposal made by the hon. Member who outlined that very effective glimpse of a world fit for heroes to live in, but very remote from our own shores, will command the attention and support of His Majesty's Government. So far as we are concerned, all those questions are dealt with purely upon their merits. Emigration, we are told, is one solution. It was from this side of the House that the other day the suggestion was made that our population is now too large. If it be a result of the War that the economic position we have held in the world can be held by us no more; if it be a result of the War that our peculiar position as a specialised productive country and world industrial power has gone, emigration must be faced and will be faced. Yes, but it is a very extraordinary phenomenon, and it casts a grave reflection upon all those assumptions that in principle and in system this country is governed as well as it possibly can be and that no fundamental changes in that respect are necessary. But there is something more. It is also very extraordinary that a great many of those who have emigrated and have gone abroad seeking new homes and fresh prosperity have failed to find them and are now back in this country, registered at the Employment Exchanges, with all their savings and all their protection against continued poverty gone and, without homes, are in a very much worse position than they were before they went.

The position is a serious and very complicated one, and we know it perfectly well. Our charge is this: First of all, the Government took no precaution to meet it before it came. My right hon. Friend the Member for Spen Valley (Sir J. Simon) referred to a Report presented to the Government in 1918. That was not the beginning. Questions were put by some of us when we were Members of this House before, as early as 1916, warning the Government then that after the War an aftermath of the nature through which we are now going would come. The then Prime Minister told us that he had appointed a special Reconstruction Committee, that he had given specialised officers to that Committee, and that one gentleman very well known for his great social experience, Mr. Vaughan Nash, had been specially appointed to take charge of all this reconstruction proposing that was going to go on during the War, so that when we came to peace the great book would be opened, and, behold, all sorts of schemes would be put into operation straight away. What happened? In 1918 friends of ours made an extraordinarily good report, warning, advising, suggesting. Nothing was done until 1920, when, as an hon. Gentleman opposite said, the storm broke upon us, and we prided ourselves upon bringing waterproofs and umbrellas when the rain was pouring down upon our heads. It was perfectly plain to anyone watching the affairs of Europe that when the War was over and peace began to be constructed the Governments of this country and of France commenced to pursue a policy that was bound to destroy the markets. They can advance what excuses they like, but the simple economic fact was—and it is not going to be twisted, turned or thwarted by any sentiment whatever—every one who went abroad saw it, every one accustomed to see the beginning of changes in economic policy detested it—the fact was that in 1918 to the end of the year, and right up till 1921, the policy for which the Governments made themselves responsible was a policy of destroying production and of destroying markets. At the very time when hon. Members were going about the country asking our workpeople to produce, they themselves, as responsible politicians, were supporting a Government which by its policy made that extra production absolutely useless. It is not production only that we want. We certainly want production; we want full production, and we want honest production, but when that production has been accomplished, if it merely accumulates and is not sold or exchanged, then that kind of production is merely the first step of national bankruptcy. That is our position.

I find myself—I dare say hon. Members opposite will be surprised—in some measure of agreement with those who yesterday talked about the very evil effects of trade disputes. Yes, I do not say strikes, I do not say lock-outs. I say trade disputes. Where I part company with those who spoke about this yesterday is this: that when they go through the evolution of a trade dispute and come to the point when Labour acts, then they say that that is the reason for it all. The hon. Member for Hampstead said yesterday, "The truth is somewhere." [HON. MEMBERS: "The truth lies somewhere!"] The expression was so precious that I apologise to the House for having spoilt it. At any rate, the hon. Member in his paltry attempt to escape responsibility said, "The truth lies somewhere." I am certain it does not lie just at that point where Labour begins to defend itself against capitalist oppression, and those who blame Labour for all the consequences that follow, I am perfectly certain, have not got hold of the truth.


I do not think that any employer has ever made any such charge. They are endeavouring to do everything that is possible to co-operate with Labour, so that these disputes may be avoided; but there is a difference of opinion as to how that can be achieved.


I do not think that that is the point I have been raising at all. What I say is that, taking the coal dispute itself, certain hon. Members yesterday actually talked as though they were under the impression that the Spa Agreement was made after the coal dispute started. In that dispute you first of all had Government action, resulting in a difficulty for Capital and in a difficulty for Labour. When that Government action is taken, Capital and Labour get into trouble with each other; Capital takes up a certain attitude which Labour declines to accept, and for very good reasons. Who now defends the wages paid to the miners? Who now can go to a mining district and survey the terrible state of poverty and destitution there, and trace it back to what happened in that dispute—not through the action of the men, not through the action of the men's leaders—who can trace it back to the inception of the dispute, which was created by the short-sighted international policy of the Government, and then say that Labour was not justified in refusing passively to accept the conditions which Capital sought to impose upon it? I will take Ebbw Vale and detail that, if hon. Members wish; but, unfortunately, what disturbs me more than hon. Members' interruptions is that the finger of the clock goes round.

Our Amendment calls for three things, and criticises the Government for not doing them. Firstly, in a state of unemployment such as we have to-day, we must have ameliorative work, or ameliorative treatment; and, as has been said again and again from these benches, if you cannot find work, which is your first responsibility, then maintenance must be found. You have not found maintenance, and you have not found work. The scheme that was produced yesterday is a scheme which cannot be implemented by a definite statement of how many men are going to be employed upon it. I asked the right hon. Gentleman yesterday for such a statement. It could have been produced. It is not exactly in his speech. He very wisely refused to grant my request. If he had, I am certain that he could not have made out even the liberal figures that my hon. Friend the Member for Colne Valley (Mr. Snowden) made out this morning. My hon. Friend was, I think, far too generous. I have also asked that these figures should be taken out. I have not been able to make myself responsible for them, but they have been taken out by one in whose ability I can trust, and they show that not more than about 120,000 men can be employed upon these schemes as they are—120,000 out of 1,500,000.

The whole thing is so unsatisfactory and so inadequate that to criticise it almost defies one. You have one in 10 or one in 15 getting this work, and being put under pressure of the necessity of competition to get this little stroke of luck, to come under the really beneficial part of this scheme. You have crowds of people expecting and hoping, and 19 out of 20, when the decision is come to, will be turned away and told that their hope has been absolutely misplaced. I am certain that hon. Members opposite, when they consider what that means, when they consider the psychological effect, when they consider what it means to people who have been for months and months out of work, acquiring bad habits— people who during the War, and owing to the high wages paid during the War, were beginning to move steadily up the scale, beginning to enjoy a much better life, beginning to acquire better conceptions of social happiness and social harmony, now sinking back, after a long period of either total unemployment or only partial employment, and being told, after this scheme has been brought into operation, that their expectations from it are nil. Let hon. Members imagine what the effect upon the mind of masses of the people such an experience is going to have. Moreover, we say if this House is going to deal with unemployment, it must not only deal with it in this ameliorative way. It must be remembered that the only thing that is satisfactory is a return to normal trade and normal conditions. You cannot go on subsidising, either by gold or anything else. A money subsidy without labour is a last resort, adopted, not because it is good in itself, but out of sheer necessity, with the full knowledge that it is bad in itself, and, therefore, the Government's duty is to go on developing a policy which will produce as quickly as possible a normal state of trade. There are two things that stand in the way. The first, undoubtedly, is the unsettled condition of what is known as German reparations. It is all very well to smile. I do not know a single business man who is interested in international trade who does not share that view. The great difficulty is this. The right hon. Gentleman quoted certain things that were said by this bench, by supporters of ours, by the right hon. Gentleman who was the chairman of the party when the Treaty Bill was before the House. As a matter if fact the quotations did not justify the right hon. Gentleman's conclusions. What was said was that Germany should repair the devastated areas, should make good the loss and the destruction. It is certainly two years ago since a conference of French and German trade unionists met in Switzerland and came to an agreement by which German labour should restore the French devastated districts, and if that has not been done it is certainly not the fault of those of us who sit here or the organisations with which we act. The French would not have it because there are so many capitalist interests involved. [Interruption.] Hon. Members are profoundly mistaken-. The statement I have just made is a quotation from a speech made by a late Minister in the French Chamber of Deputies. However, the point is that until reparations are settled, until German obligations are fixed, we cannot reestablish international trade. I was surprised that the right hon. Gentleman seemed to regard as something that was very negligible the economic condition of central Europe.


indicated dissent.


I misunderstood the right hon. Gentleman. I am very glad I did. It is of the greatest consequence to us that Central Europe should become economically restored, that Central Europe should become a market, that Central Europe should send goods to us and take goods from us, and that Central Europe should complete that great world-wide round of production, exchange and distribution, without which, and until it is complete, we can never produce to our maximum and our people can never enjoy wages to their maximum.

The other point that struck me was the matter of debt. The situation to-day is that probably there never was in the whole history of the world such a liberal dipping into and such a claiming of a share of our annual national income by hands that yield no production. That is largely the result of our enormous National Debt. Until we lighten the National Debt we cannot lower the costs

of our production and improve our position in the neutral markets of the world as we should like to do. How can it be done? Hon. Members opposite were a little hilarious when my hon. Friend the Member for Colne Valley (Mr. Snowden) declined to enter into a controversy about the capital levy. I can assure hon. Members that they will not have to wait very long for that. In the meantime, I will content myself with inviting them to consider how they can reduce the National Debt. There is a tribute being paid from national income of something like £300,000,000 per annum. You cannot go on paying that. The nation, the industrial nation cannot go on paying that tribute. Wages cannot go on bearing the taxation which is necessary to pay it. It is imposing such heavy taxation that a scientific system of taxation is quite impossible. It cannot be done. Yet business men with large economic and industrial interests, with which we associate the party opposite, are laughing at us for producing a scheme by which the National Debt can be reduced— [HON. MEMBERS: "By confiscation!"]— by which taxation can be reduced, by which costs of production can be reduced, by which, without increasing wages by a single sixpence, wages can be materially increased in their real value. Instead of smiling at us they ought to receive us with open arms. Covering the ground as rapidly as I could, I hope the House will support the Amendment as a Vote of Censure upon the Government for its neglect during the four years and for its failure to indicate practical remedial measures.

Question put, "That those words be there added."

The House divided: Ayes, 172; Noes, 303.

Division No. 10.] AYES. [4.0 p.m.
Adamson, W. M. (Staff. Cannock) Brotherton, J. Cowan, D. M.(Scottish Universities)
Alexander, A. V. (Sheffield, Hillsbro') Buchanan, G. Darblshire, C. W.
Ammon, Charles George Buckle, I. Davies, Evan (Ebbw Vale)
Asqulth, Rt. Hon. Herbert Henry Burgess, S. Davies, Rhys John (Westhoughton)
Attlee, C. R. Burnie, Major J. (Bootle) Davison, J. E. (Smethwick)
Barker, G. (Monmouth, Abertillary) Buxton, Charles (Accrington) Dudgeon, Major C. R.
Barnes, A. Buxton, Noel (Norfolk, North) Duffy, T. Gavan
Batey, Joseph Cairns. John Dunnico, H.
Benn, Captain Wedgwood (Leith) Cape, Thomas Edmonds, G.
Berkeley, Captain Reginald Chapple, W. A. Edwards, C. (Monmouth, Bedwellty)
Bonwlck. A. Charleton, H. C. Emlyn-Jones, J. E. (Dorset, N.)
Bowerman, Rt. Hon. Charles W. Clynes, Rt. Hon. John R. Entwistle, Major C. F.
Briant, Frank Collins, Sir Godfrey (Greenock) Fairbairn, R. R.
Broad, F. A. Collins, Pat (Walsall) Falconer, J.
Bromfield, William Collision, Levi Foot, Isaac
Graham, D. M. (Hamilton) Lowth, T. Short, Alfred (Wednesbury)
Gray, Frank (Oxford) Lunn, William Simon, Rt. Hon. Sir John
Greenall. T. Lyle-Samuel, Alexander Simpson, J. Hope
Greenwood, A. (Nelson and Colne) MacDonald, J. R. (Aberavon) Sitch, Charles H.
Grenfell, D. R. (Glamorgan) M'Entee, V. L. Smith, H. B. Lees (Keighley)
Griffiths, T. (Monmouth. Pontypool) McLaren, Andrew Smith, T. (Pontefract)
Groves, T. March, S. Snell, Harry
Grundy, T. W. Marshall, Sir Arthur H. Snowden, Philip
Hall, F. (York, W. R, Normanton) Martin, F. (Aberd'n & Kinc'dine, E.) Spencer, George A. (Broxtowe)
Hall, G. H. (Merthyr Tydvil) Mathew, C. J. Stephen, Campbell
Hamilton, Sir R. (Orkney & Shetland) Maxton, James Stewart, J. (St. Rollox)
Hancock, John George Middleton, G. Thomas, Rt. Hon. James H. (Derby)
Harbord, Arthur Millar, J. D. Thorne, G. R. (Wolverhampton, E.)
Hardle, George D. Morel. E. D. Thorne, W. (West Ham, Plalstow)
Harney, E. A. Morrison, R. C. (Tottenham, N.) Thornton, M.
Harris, Percy A. Mosley, Oswald Tillett, Benjamin
Hartshorn, Vernon Muir, John W. Tout, W. J.
Hastings, Patrick Murray, Hon. A. C. (Aberdeen) Trevelyan, C. P.
Hay, Captain J. P. (Cathcart) Murray, R. (Renfrew, Western) Wallhead, Richard C.
Hayday, Arthur Newbold, J. T. W. Walsh, Stephen (Lancaster, ince)
Hemmarde, E. G. Nicol, Robert Warne, G. H.
Henderson, T. (Glasgow) O'Grady, Captain James Watson, W. M. (Dunfermline)
Herrlotts, J. Oliver, George Harold Watts-Morgan, Lt.-Col. D. (Rhondda)
Hill, A. Paling, W. Webb, Sidney
Hillary, A E. Parker, H. (Hanley) Wedgwood, Colonel Josiah C.
Hirst, G. H. Pattlnson, R. (Grantham) Weir. L. M.
Hodge, Rt. Hon. John Pattlnson, S. (Horncastle) Welsh, J. C.
Hogge, James Myles Phillipps, Vivian Westwood, J.
Irving, Dan Ponsonby, Arthur Wheatley, J.
Jenkins, w. (Glamorgan, Neath) Potts, John S. White, H. G. (Birkenhead, E.)
John, William (Rhondda, West) Pringle, W. M. R. Whltelsy, W.
Johnston, Thomas (Stirling) Richardson, R. (Houghton-le-Spring) Wignall, James
Jones, J. J. (West Ham, Silvertown) Riley, Ben Williams, David (Swansea, E.J
Jones, Morgan (Caerphilly) Rltson, J. Williams, Dr. J. H. (Llanelly)
Jones, R. T. (Carnarvon) Roberts, C. H. (Derby) Williams, T. (York, Don Valley)
Jowett, F. W. (Bradford, East) Roberts, Frederick O. (W. Bromwich) Wilson, c. H. (Sheffield, Attercilfie)
Jowitt, W. A. (The Hartlepools) Robertson, J. (Lanark, Bothwell) Wilson, R. J. (Jarrow)
Kenyon, Barnet Rose, Frank H. Wintringham, Margaret
Kirkwood, D. Sakiatvala, S. Wood, Major M. M. (Aberdeen, C.)
Lansbury, George Salter, Dr. A, Wright, W.
Lawson, John James Scrymgeour, E. Young, Robert (Lancaster, Newton)
Leach, W. Shaw, Thomas (Preston)
Lee, F. Shinwell, Emanuel TELLERS FOR THE AYES.—
Mr. Spoor and Mr. Neil Maclean.
Ainsworth, Captain Charles Burney, Com. (Middx., Uxbridge) Du Pre, Colonel William Baring
Alexander, E. E. (Leyton, East) Butcher, Sir John George Edge, Captain Sir William
Alexander, Col. M. (Southwark) Butler, H. M. (Leeds, North) Edmondson, Major A. J.
Amery, Rt. Hon. Leopold C. M. S. Butt, Sir Alfred Ednam, Viscount
Apsley, Lord Button, H. S. Elliot, Capt. Walter E. (Lanark)
Archer-Shee, Lieut.-Colonel Martin Cadogan, Major Edward Elveden, Viscount
Ashley, Lt.-Col. Willfrid W. Campion, Lieut.-Colonel W. R. Erskine-Bolst, Captain C.
Astor, J. J. (Kent, Dover) Cayzer, Sir C. (Chester, City) Evans, Capt. H. Arthur (Leicester, E.)
Astor, Viscountess Cecil, Rt. Hon. Sir Evelyn (Aston) Evans, Ernest (Cardigan)
Baldwin, Rt. Hon. Stanley Cecil, Rt. Hon. Lord H. (Ox. Univ.) Eyres-Monsell, Com. Bolton M.
Balfour, George (Hampstead) Chadwick, Sir Robert Burton Falcon. Captain Michael
Banbury, Rt. Hon. Sir Frederick G. Chamberlain, Rt. Hon. N. (Ladywood) Falle, Major Sir Bertram Godlray
Banks, Mitchell Chapman, Sir S. Fawkes, Major F. H.
Barlow, Rt. Hon. Sir Montague Chilcott, Sir Warden Fermor-Hesketh, Major T.
Bamett, Major Richard W. Churchman, Sir Arthur Fildes, Henry
Barrle, Sir Charles Coupar (Banff) Clarry, Reginald George Fisher, Rt. Hon. Herbert A. L.
Becker, Harry Clay, Lieut.-Colonel H, H. Spender Flanagan, W. H.
Bell, Lieut.-Col. W. C. H. (Devizes) Clayton, G. C. Ford, Patrick Johnston
Bellairs, Commander Carlyon W. Cobb, Sir Cyril Foreman, Sir Henry
Bennett, Sir T. J. (Sevenoaks) Cockerill, Brigadier-General G. K. Foxcroft, Captain Charles Talbot
Bentlnck, Lord Henry Cavendish- Colfox, Major Wm. Phillips Fraser, Major Sir Keith
Berry, Sir George Collie, Sir John Frece, Sir Walter de
Betterton, Henry B. Colvin, Brig,-General Richard Beale Fremantle, Lieut.-Colonel Francis E.
Birshall. J. Dearman Conway, Sir W. Martin Furness, G. J.
Bird, Sir R. B. (Wolverhampton, W.) Cotts, Sir William Dingwall Mitchell Galbraith, J. F. W.
Blades, Sir George Rowland Craig, Capt. C. C. (Antrim, South) Ganzoni, sir John
Blundell, F. N. Cralk, Rt. Hon. Sir Henry Gardiner, James
Bowyer, Capt. G. E. W. Croft, Lieut-Colonel Henry Page Garland, C. S.
Boyd-Carpenter, Major A. Crook, C. W. (East Ham, North) Gates, Percy
Brass, Captain W. Crooke, J. S. (Deritend) Gaunt, Rear-Admiral Sir Guy R.
Brassey, Sir Leonard Curzon, Captain Viscount George, Major G. L. (Pembroke)
Bridgeman, Rt. Hon. William Clive Dalzlel, Sir D. (Lambeth, Brixton) Gilmour, Lt.-Col. Rt. Hon. Sir John
Brlttain, Sir Harry Davidson, J. C. C. (Hemel Hempstead) Goff. Sir R. Park
Brown, Brig.-Gen. Clifton (Newbury) Davidson, Major-General Sir J. H. Gould, James C.
Brulord, R. Davies, Thomas (Cirencester) Gray, Harold (Cambridge)
Bruton, Sir James Davison, Sir W. H. (Kensington, S.) Greaves-Lord, Walter
Buckley, Lieut.-Colonel A. Dawson, Sir Philip Grenfell, Edward C. (City of London)
Bull, Rt. Hon. Sir William James Dixon, C. H. (Rutland) Grigg, Sir Edward
Burn, Col. C. R. (Devon, Torquay) Doyle, N. Grattan Guest, Hon. C. H. (Bristol, N.)
Guinness, Lieut.-Col. Hon. W. E. Lumley, L, R. Richardson, Lt.-Col. Sir P. (Chrtsy)
Hacking, Captain Douglas H. Lynn, R.J. Roberts, Samuel (Hereford, Hereford)
Hall, Lieut. Col. Sir F. (Dulwich) McCurdy, Rt. Hon. Charles A. Roberts, Rt. Hon. Sir S. (Ecclesali)
Hall, Rt. Adml Sir W.(Llv'p'l,W.D'by) Macdonald, Sir Murdoch (Inverness) Robertson, J. D. (Islington, W.)
Ha stead. Major D. Macnaghten, Hon. Sir Malcolm Roundell, Colonel R. F.
Hamilton, Sir George C. (Altrincham) Macnamara, Rt. Hon. Dr. T. J. Russell. Alexander West (Tynemouth)
Hannon, Patrick Joseph Henry McNeill, Ronald (Kent, Canterbury) Russell, William (Bolton)
Harrison, F. C. Macpherton, Rt. Hon. James I. Russell-Wells, Sir Sidney
Harvey, Major S. E. Makins, Brigadier-General E. Rutherford, Sir W. W. (Edge Hill)
Hawke, John Anthony Malone, Major P. B. (Tottenham, S.) Samuel, A. M. (Surrey, Farnham)
Hay, Major T. W. (Norfolk, South) Manville, Edward Samuel, Samuel (W'dsworth, Putney)
Henderson, Sir T. (Roxburgh) Margesson, H. D. R, Sanders, Rt. Hon. Sir Robert A.
Henn, Sir Sydney H. Mason, Lieut.-Col. C. K. Sanderson, Sir Frank B.
Hennessy, Major J. R. G. Milne, J. S. Wardlaw Sandon, Lord
Herbert, Col. Hon. A. (Yeovil) Mitchell, W. F. (Saffron Walden) Shaw, Hon. Alex. (Kilmarnock)
Herbert, Dennis (Hertford, Watford) Mitchell, Sir W. Lane (Streatham) Shepperson, E. W.
Herbert, S. (Scarborough) Moles, Thomas Simms, Dr. John M. (Co. Down)
Hewett, Sir J. P. Molloy, Major L. G. S. Sinclair, Sir A.
Hilder, Lieut.-Colonel Frank Molson, Major John Elsdale Singleton, J. E.
Hiley, Sir Ernest Moore, Major-General Sir Newton J. Skelton, A. N.
Hinds. John Moore-Brabazon, Lieut.-Col. J. T. C. Somerville, A. A. (Windsor)
Hoare, Lieut-Colonel Sir S. J. G. Morden, Col. W. Grant Somerville, Daniel (Barrow-ln-Furn'ss)
Hogg. Rt. Hon. Sir D. (St. Marylebone) Morrison-Bell, Major A. C. (Honlton) Sparkes, H. W.
Holbrook, Sir Arthur Richard Murchlson, C. K. Spears, Brig.-Gen. E. L.
Hoot, Sir Joseph Nail, Major Joseph Stanley, Lord
Hopkins. John W. W. Nesbitt, J. C. Steel, Major S. Strang
Home, Sir R. S. (Glasgow, Hillhead) Newman, Colonel J. R. P. (Flnchley) Stewart, Gershom (Wirral)
Houtton, John plowright Newman, Sir R. H. S. D. L. (Exeter) Stockton, Sir Edwin Forsyth
Houston, Sir Robert Patterson Newson, Sir Percy Wilson Stott, Lt.-Col. W. H.
Howard, Capt. O. (Cumberland, N.) Newton, Sir D. G C. (Cambridge) Stuart, Lord C. Crichton
Howard-Bury, Lieut.-Col. C. K. Nicholson, Brig.-Gen. J. (Westminster) Sueter, Rear-Admiral Murray Fraser
Hudson, Capt. A. Nicholson, William G. (Petersfield) Sugden, Sir Wilfrid H.
Hughes. H. Collingwood Nield, Sir Herbert Sutcliffe, T.
Hume, G. H. Norton-Griffiths, Lieut.-Col. Sir John Sykes, Major-Gen. Sir Frederick H.
Hums-Willlams, Sir W. Eills O'Neill, Rt. Hon. Hugh Thomson, Luke (Sunderland)
Hunter-Weston, Lt.-Gen. Sir Aylmer Ormsby-Gore, Hon. William Thomson, F. C. (Aberdeen, South)
Hurd, Percy A. Paget, T. G. Thorpe, Captain John Henry
Hurst, Lt.-Col. Gerald Berkeley Parker, Owen (Kettering) Titchfield, Marquess of
Hutchison, G. A. C. (Peebles, N.) Parry, Lieut.-Colonel Thomas Henry Tryon, Rt. Hon. George Clement
Hutchison. W. (Kelvingrove) Pease, Rt. Hon. Herbert Pike Tubbs, S. W.
Inskip, Sir Thomas Walker H. Penne father, De Fonblanque Turton, Edmund Russ borough
Jackson, Lieut.-Colonel Hon. F. S. Penny, Frederick George Wallace, Captain E.
James, Lieut.-Colonel Hon. Cuthbert Percy, Lord Eustace (Hastings) Ward, Col. L. (Kingston-upon-Hull)
Jarrett, G. W. S. Perkins, Colonel E. K. Warner, Sir T. Courtenay T.
Jephcott, A. R. Perring, William George Watson, Capt. J. (Stockton-on-Tees)
Jodrel, Sir Neville Paul Phillpson, H. H. Watts, Dr. T. (Man., Withington)
Johnson, Sir L. (Walthamstow, E.) Pielou, D. P. Wells, S. R.
Jones, G. W. H. (Stoke Newington) Pildltch, Sir Philip Wheler, Col. Granville C. H.
Kelley, Major Fred (Rotherham) Pownall, Lieut.-Colonel Assheton White, Lt.-Col. G. D. (Southport)
Kennedy, Captain M. S. Nigel Pretyman, Rt. Hon. Ernest G. Whltla, Sir William
King, Capt. Henry Douglas Price, E. G. Willey, Arthur
Kinloch-Cooke, Sir Clement Prlvett, F. J. Windsor, Viscount
Lamb, J. Q. Rae, Sir Henry N. Winterton, Earl
Lane-Fox, Lieut.-Colonel G. R. Raeburn, sir William H. Wise, Frederick
Law, Rt. Hon. A. B. (Glasgow, C.) Rawlinson, John Frederick Peel Wolmer, Viscount
Lever, Sir Arthur L. Rawson, Lieut.-Com. A. C. Wood, Rt. Hn. Edward F. L. (Rlpon)
Lloyd, Cyril E. (Dudley) Rees, Sir Beddoe Wood, Maj. Sir S. Hill- (High Peak)
Lloyd-Greame, Rt. Hon. Sir Philip Reid, D. D. (County Down) Woodcock, Colonel H. C.
Locker-Lampson, Com. O. (Handsw'th) Remnant, Sir James Worthington-Evans, Rt. Hon. Sir L.
Lorimer, H. D. Rentoul, G. S. Yerburgh, R. D. T.
Lort-Williams, J. Reynolds, W. G. W.
Lougher, L. Rhodes, Lieut.-Col. I. P. TELLERS FOR THE NOES.—
Loyd, Arthur Thomas (Abingdon) Richardson, Sir Alex. (Gravesend) Colonel Gibbs and Major Barnston.

Main Question again proposed.

It being after Four of the Clock, and objection being taken to further Proceedings, the Debate stood Adjourned.

Debate to be resumed upon Monday next (4th December).