HC Deb 02 June 1938 vol 336 cc2231-3
66. Mr. Craven-Ellis

asked the Chancellor of the Exchequer whether, in view of the fact that commodity prices in February and March, 1937, were at an artificial and exaggerated level, the Government has abandoned its frequently declared policy of persisting in furthering the rise of wholesale prices until there is evidence that equilibrium has been re-established?

Captain Wallace

No, Sir.

67. Mr. Boothby

asked the Chancellor of the Exchequer whether his attention has been called to the effects of the prevailing deflation throughout the British Empire; and whether His Majesty's Government will take consultation with the Federal Government of the United States, with a view to enlisting their co-operation in joint action designed to check the progressive weakening of the economic strength of the democratic countries by restoring world commodity prices to a remunerative level?

Captain Wallace

My right hon. Friend regrets the recent fall of certain commodity prices, but this is in no way due to any deflationary action in this country. The policy of His Majesty's Government, as has been frequently stated in this House, is to remove so far as lies in their power all obstacles which tend to depress commodity prices below a remunerative level, and to seek the widest possible measure of agreement, as in the case of our present negotiations with the United States of America, for the removal of the barriers to international trade which are the main obstacles to economic recovery. There is no reason to suppose that the general objectives of the Government of the United States of America in this respect are not in accord with our own, and my right hon. Friend is not clear as to what precise action my hon. Friend has in mind

Mr. Leach

Why do the Government regret a fall in prices of any of the necessities of life?

Captain Wallace

Because we believe that if you have the price of basic necessities so low that it does not provide a living to the producer, you are starting on a vicious spiral.

Mr. Shinwell

Is the right hon. and gallant Gentleman aware that the depression in commodity prices is attributable to a fall in demand, and how does he propose to correct that?

Captain Wallace

I am afraid we cannot properly discuss the general economic policy of the Government by question and answer.