§ There has been a very marked tendency in the Press, in its review of the economic situation following upon the publication of the Economic Survey, to comment to the effect that the Survey for 1950 marks the abandonment of all attempts to plan our economy. That is, perhaps, a somewhat peculiar complaint by those who profess to be opposed to planning. It has always been difficult to explain, especially to those who did not wish to understand, the real object and the limitations of democratic planning. In two earlier documents this has been explained at some length, in the 1947 Survey and the long-term programme, and on numerous occasions in speeches. I must, however, in view of the obvious continued misunderstanding, try to explain the position once again.
39§ Democratic planning has for its objective to combine a free democracy with a planned economy. That synthesis is not an easy one, though I believe it is absolutely vital to the continuance of democratic freedom in the world. We are out after something a great deal more important than a good piece of planning machinery or even than a particular way of organising our industries and services. Our aim is to create a Happy Country in which there is equality of opportunity, and not too great a disparity of personal incomes, and in which every man and woman can feel that they are welcomed and have a full part to play and are invited to take their share in the democratic control of their country's economy.
§ It is basic to that kind of life that there should be full employment and full participation by the workers in the industrial life of the community. How particular planning operations are carried out or how particular industries are organised is only important in so far as such matters are essential steps in attaining the goal at which we aim. It is not possible any more than it is desirable in such a democratically planned economy, to use the violent compulsions that are appropriate to totalitarian planning. Nor would it be sensible to attempt to decide from the centre all the details of production and distribution. Such day-to-day decisions must obviously be made by individual undertakings within the broad framework of national policy laid down by the Government.
§ It follows, therefore, from these two reasons—the democratic nature of our planning and the necessity for avoiding over-centralisation—that while we dan and must use some financial and physical controls, yet a great part of the direction and control of the economy must be accomplished by agreement, persuasion, consultation and other free democratic methods. While therefore we can forecast what is likely to happen or map the possibilities offered for achievement, it is not possible to lay down a rigid target and say that it will be achieved, since in many cases there can be no democratic method of making sure of that achievement. That is not a failure of planning, but a recognition of the fact that there must be limitations to the capacity of a democracy to force the 40 implementation of any economic plan which it lays down.
§ Some controls are acceptable to a democracy—rationng is a good example —and we have in fact been able, by controls, to prevent many undesirable economic results which would in these post-war years have militated against the achievement of our aims. Some positive controls, too, have been and can be used, especially in the area of public expenditure, such for instance as the building of factories in the development areas.
§ Indeed, the Budget itself can be described as the most important control and as the most powerful instrument for influencing economic policy which is available to the Government. During the last Parliament its influence was brought strongly to bear against inflation, by reducing the excess purchasing power in our economy. We have thus been able, while maintaining full employment, to stimulate rapidly the development of our export trade and thereby tc help towards a solution of our balance of payments problem. Our very considerable success proves indeed the value and efficacy of our budgetary planning.
§ What has been so remarkable over the last three or four years is that so many people of every section of the population and of all shades of political opinion have played their part in the organised voluntary effort to achieve the economic goals set out in the Surveys. Because of this combination of moderate controls democratically accepted by the nation and the people's willingness to follow voluntarily the directions set out, we have in fact succeeded in a large measure—I would say a very large measure—in keeping to the difficult path of economic progress that we have planned in this postwar period. The Economic Survey for 1950 shows the degree of our success in 1949 in following that road and indicates how we can proceed a further stage in the same right direction.