Lords Sitting of 7 December 1939

Preamble
The House met at half past three of the clock, The LORD CHANCELLOR on the Woolsack

BUSINESS: THE CHRISTMAS RECESS.
LORD SNELL: My Lords, I beg to ask the noble Earl, the Leader of the House, if he can make any statement in regard to the business of the House.
THE LORD PRESIDENT OF THE COUNCIL (EARL STANHOPE): My Lords, I am much obliged to the noble Lord for giving me the opportunity of making a statement. The House will meet on Tuesday next, when, in addition to the business already on the paper, we shall take the Committee stage of the India and Burma (Miscellaneous Amendments) Bill, and shall expect to receive from another place the Expiring Laws Continuance and Postponement of Enactments (Miscellaneous Provisions) Bills, which it is hoped to pass into law before the House rises for the Christmas Recess. On Wednesday, in addition to the business already on the Paper, we shall take the Second Readings of the two Bills received from the Commons the previous evening. I hope to make arrangements to have the Bills circulated to your Lordships so that you will have time to consider them. On Thursday we shall complete proceedings on the three Bills before the House and take Lord Leverhulme's Motion on the Central Register. There will probably be a Government statement that day on the general situation, after which there will be a Royal Commission and the House will rise for the Christmas Recess. The House will meet at 3.30 p.m. on Tuesday and Wednesday. The precise time of meeting on Thursday has not yet been definitely arranged, but I think it may be 2 p.m. The House will reassemble, unless recalled specially, on January 16.

INDIA AND BURMA (MISCELLANEOUS AMENDMENTS) BILL. [H.L.]
Order of the Day for the Second Reading read.
THE SECRETARY OF STATE FOR INDIA AND BURMA (THE MARQUESS OF ZETLAND): My Lords, this is a Bill consisting of some 16 clauses which effect a miscellaneous assortment of Amendments in the Government of India and the Government of Burma Acts, 1935, together with a printing clause, the effect of which will be to ensure, in the event of this Bill becoming law, that the Amendments made in the original Acts will be incorporated in the texts of the Acts in any future official issues of them that may be made. The greater number of the clauses of this Bill have already been assented to by your Lordships, since they appeared in the India and Burma (Miscellaneous Amendments) Bill which passed through all its stages in your Lordships' House last Session but, owing to lack of time and opportunity, made little progress in another place. I should perhaps, therefore, confine myself to explaining to your Lordships the extent to which the present Bill differs from the previous Bill to which your Lordships gave your assent.
Three of the clauses which were included in the previous Bill find no place in the present one. The reason for that, as regards two of them which sought to give the Central Government certain powers of co-ordination over the activities of the Provincial Governments in the event of war, is that they were actually dealt with by Parliament as an emergency measure and became law shortly after the outbreak of war. The other clause which no longer finds a place in this Bill was designed to give the Federal Government the power of imposing countervailing duties against a unit of the Federation in order to counteract discriminatory action, should that be proposed by a unit itself to the disadvantage of the Federation at large. But since, owing to the outbreak of the war, our negotiations for bringing the federal provisions of the Act of 1935 into operation have been temporarily suspended, there is no present need for such a provision. As against these three omissions there are four additions to the present Bill—namely Clauses 2, 4, 15 and 16, two of which amend the Government of India Act and the other two the Government of Burma Act.
Of the two clauses amending the Government of Burma Act, Clause 15 in

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the present Bill will, in effect, make possible the Amendment of an Order in Council affecting the financial settlement between India and Burma. Now that the final balance sheet of assets and liabilities of the two countries is in sight, it is necessary to make some adjustment in the provisional allocation of assets and liabilities which was made by the Order in Council. But, owing to an oversight, it is found that it is not possible under the text of the Government of Burma Act, as it at present exists, to bring in an Order in Council superseding that which is already in existence, and the whole purpose of this Amendment is to make it possible to bring in an Order to supersede that which is now out of date. Then the other Amendment to the Government of Burma Act is effected by Clause 16 of the present Bill, and the effect of that clause will be to enable the Burma Legislature to make provision to apply, with such modifications as may be necessary, the provisions of the Naval Discipline Act, to naval forces raised in Burma. The need for this provision has arisen as a result of a decision to raise in Burma a Naval Volunteer Force for the local defence of the approaches to Rangoon. So much, then, for the Amendments of the Government of Burma Act.
I now turn to the two new Amendments to the Government of India Act. Of these, Clause 4 merely corrects an oversight in the original Act in connection with the issue by the Governor of Ordinances made on the advice of his Ministers. By some oversight these Ordinances do not stand in precisely the same position as Ordinances issued by the Governor in his discretion or as Acts of the Legislatures or as Governors' Acts, and the purpose of this Amendment is really to rectify that omission and to place these Ordinances on the same footing as the others. Then, finally, I come to Clause 2 of the Bill, which is of rather more than merely technical interest and importance. The purpose of it is to place beyond dispute the distinction which it was always intended should be drawn between taxes on income, on the one hand, and taxes on professions, trades, callings, and employments on the other. Taxes on income, other than agricultural income, are a Federal source of revenue, whereas taxes on professions, trades, callings, and employments are a Provincial source of revenue. It was never intended,
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of course, that taxes under these Provincial heads should be so imposed as to constitute an Income Tax and so trespass upon the Central field of revenue.
Indeed, the main purpose in view, when these headings were included in the Provisional list, was to keep alive the right which Provincial Governments had exercised in the past of empowering local authorities such as municipalities and district boards to levy rates for local purposes which were commonly described as taxes on professions and taxes on circumstances and property. It was, of course, a characteristic of these taxes that their incidence upon the individual taxpayer was a very small one. Experience has shown, however, that it is possible to levy taxes under these heads which are, in fact, nothing less than Income Taxes in disguise. Some little time ago the Legislature of the United Provinces enacted a taxing Bill under the heading of an Employment Tax which was, in fact, nothing less than an Income Tax. It would have imposed on the incomes concerned of all those who derive their income from employment a substantially graduated tax which, in respect Of a large part of the incomes concerned, would have amounted to as much as 10 per cent. It is quite clear that this would have constituted a serious invasion of one of the more important sources of revenue which had been assigned to the Federal Government, and it is equally clear that if it were to be permitted on a large scale it would have the effect of seriously upsetting the balance between the Federal and the Provincial field of taxation.
The effect of Clause 2 will therefore be, by limiting the amount which may be levied on any one individual in any one year under the heading of a tax upon professions, trades, callings, or employments to a specified sum, which in the Bill is placed at 50 rupees, to restrict the tax imposed to the character which it originally possessed and from which it was never intended it should depart. Perhaps I might add that while Clause 2 of the Bill thus protects the Central sources of revenue against invasion by the Provinces, Clause 3 performs a similar service to the Provinces against the Centre, for it secures to the Provincial Governments the taxes on motor vehicles and also upon the sale and consumption of

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electricity which there was some danger of the Central Government regarding as an Excise and therefore claiming as a source of Central revenue. That is, perhaps, all I need say. Apart from these four clauses and the purposes which I have endeavoured to explain, the Bill is the same which met with your Lordships' approval last Session. For the most part it deals with purely technical points, and may be said to be wholly non-controversial. I beg to move that the Bill he now read a second time.
Moved, That the Bill be now read 2ª.—(The Marquess of Zetland.)
3.46 p.m.
THE MARQUESS OF SALISBURY: My Lords, I am sure your Lordships are very much obliged to my noble friend the Secretary of State for his explanation of the terms of this Bill. I do not rise to call in question the merits of it in any respect. I rise merely for the purpose of making a suggestion to the Government. There may be some difficulty as far as the draftsmen at the present time are concerned, but in ordinary times it has generally been the practice in these Bills for your Lordships to have a small page at the beginning indicating the general scope of the provisions of the Bill so as to help members of this House, and indeed members of another place, to find their way through a Bill which carries the practice of legislation by reference to a very great length.
I make no complaint of it, but it would have been very easy to have had a little page saying that this Bill resembled in every respect the Bill passed by your Lordships in a previous Session except in these four clauses. Then members of the House who take an interest in the subject would have been able to devote their attention to these four clauses and would have saved themselves a good deal of time. Perhaps a word or two as well might have been added embodying part of the very clear explanation given by the Secretary of State in respect of Clause 2. Clause 2 appears to be the only clause in which there is an important modification which was not included in the Bill of last Session. I do not know whether my respectful suggestion to the Secretary of State might be considered, but I recognise that the draftsmen have been put to very great pains at the
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present time with emergency legislation arising from the war. It may be for that reason that the practice which was gradually growing—a good practice—in the printing of Bills has, for the moment, been omitted. I hope I may be forgiven for making that suggestion.
3.49 p.m.
LORD SNELL: My Lords, the Bill which the noble Marquess has moved is one of great technicality and difficulty, and I shall not, myself, take the responsibility of offering any opposition to it. So far as I understand it, the main part of the Bill has already received your Lordships' assent in another Session, and the purpose of the present Bill would seem to be mostly to secure a closer definition of the relationships which are to exist between the Provincial and the Central powers in India. I am presuming that these requirements have arisen out of the practical experience of the last few years and the need for securing smoother working of the great Act of 1935. I do not like to leave the subject of India, though I am afraid it is not within the scope of this Bill, without expressing a wish that it had been possible for the noble Marquess to have said something about the present general position there. Parliament will shortly rise for the Recess, and it would have been a comfort and an assurance to us all had he been able to have expressed any greater hope than that the working of the Constitution was temporarily suspended. However, I may not raise that to-day, but I do hope that before Parliament adjourns the noble Marquess may feel it possible to say a word on the general situation.
3.52 p.m.
THE MARQUESS OF ZETLAND: My Lords, I rise first of all to say to the noble Marquess that I fully appreciate the advantage of the course which he suggested, and I regret very much that it was not followed. It arose in this way. With the original Bill I did issue a White Paper. It was a fairly long White Paper, and I did consider whether I should be justified in re-issuing a similar White Paper for this Bill, which included only four new short clauses. I thought, in view of the burden which at present rests upon the Parliamentary draftsmen, to which the noble Marquess himself referred, and from the point of view of expense also, that perhaps I should

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hardly be justified in doing that; but I quite agree it would have been better if I had had a short paragraph drafted just to explain what the four new clauses were. With regard to what the noble Lord opposite has said, as he realises this is not quite the appropriate occasion on which to speak of the general position in India, but, of course, if before Parliament rises the noble Lord is desirous of having such further information as I may possess with regard to that, I shall be only too happy to give him what information I can.
On Question, Bill read 2ª, and committed to a Committee of the Whole House.

WAR AND PEACE AIMS.
Debate resumed (according to Order) on the Motion moved by Lord Snell on Tuesday last, That there be laid before the House Papers with reference to the recent declarations by the Prime Minister respecting the war and peace aims of His Majesty's Government; to the essential principles of a satisfactory and lasting peace; and to the urgent need for a wisely-planned programme of national economics and social reconstruction.
3.54 p.m.
LORD STRABOLGI: My Lords, I have the honour to continue the debate on the Motion moved by my noble friend on Tuesday. I think your Lordships who heard that interesting debate will find that there was general agreement in your Lordships' House, except on the part of my noble friend Lord Ponsonby, that the first essential principle of a "satisfactory and lasting peace," to quote the words of my noble friend's Motion, is to defeat Hitlerism, and the Foreign Secretary said that again on Tuesday. As to how we are to go about that, I understand the noble and learned Viscount on the Woolsack is going to be good enough to wind up this debate, and in view of the very important office he held for such a considerable time, I am sure your Lordships will agree that no one has a better knowledge of the preparations that were made.
Generally speaking, I am bound to say that the result of three or four years of preparation for the present war found us, when the war came, with good plans on the fighting side, and efficiency in the
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Navy, Army and Air Force, indeed high efficiency; but, unfortunately, that is not the whole story. Already it has been disclosed that the economic side of this war is not so good. By that I mean the facilities for export trade, our production at home, and the employment of our people at present idle and the unused plant. It includes also the blockade—I use that word for convenience; it is not of course an actual blockade in the legal sense of the word—and its corollary—the depriving Germany of foreign exchange by undercutting her in neutral markets, and the purchase in neutral markets of goods which would otherwise go to Germany. I suggest that whether these neutrals are friendly to us or not should make no difference on this side of the war. For example, it is wise to buy leather from Bulgaria and timber and manganese ore from Russia rather than that they should go to Germany. Of course we should be doing all this, and I presume that we are to a certain extent doing it, in conjunction with France.
Again, looking on the brighter side, the working of the naval controls at sea now outward as well as inward is good, but nearly everywhere else on the economic front, at home and abroad—I am sorry to have to say this; I never like criticising His Majesty's Government—there is a lack of vigour and drive, divided counsels and confusion. And that is not said by the wicked members of the Opposition in both Houses of Parliament or their supporters outside alone; it is being said by the Government's own supporters in the Press and elsewhere. Indeed, the honeymoon period of the new Government, or rather of the War Cabinet and the reconstructed outer Ministry, is over, and one has only to have read in the last few days the very interesting series of letters and articles in The Times newspaper, for example, to see that all is not well on this economic front. When I see The Times coming out with a full dress attack on the Government I know there is dissension within the Government or that would not happen. Then your Lordships will have seen, for it was in every newspaper, the striking criticism of Sir Warren Fisher, a very distinguished public servant now occupying an important position in the North of England. I would not dare to say the things he said in an interview

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which received such wide publicity. I agree with every word in the speech of the noble Lord, Lord Gainford, last Tuesday, if he will allow me to say so, and with the noble Lord, Lord Rea, and others who spoke in an earlier debate in your Lordships' House, and many fervent supporters of the Government on the other side, who have all pointed to what is required.
Everyone, except the Government and the Lord Chancellor and Lord Temple-more, agrees that what is needed is a suitable—I stress that word—whole-time Minister on the economic side of the war in the War Cabinet, with an efficient Economic General Staff to assist him. Everyone knows this except the Government themselves and the Lord Chancellor. When I said this on the last occasion the noble Lord, Lord Templemore, said there was a Committee of Ministers under Sir Samuel Hoare's Chairmanship. The short answer to that is that it does not work, and is not working. Everyone knows that; even the Lord Chancellor knows it; he cannot fail to know it. How can we be satisfied? How can the Lord Chancellor be satisfied when, despite heavy enlistments for the Forces, 1,400,000 workers are still unemployed, including 28,000 agricultural workers? I am not an expert on agriculture, but my noble friend Lord Addison is, and my noble friend tells me that this talk of these workers being unemployed for seasonal reasons is nonsense; that they could be employed and should be employed at the present time in winter ploughing and clearing land. I am sure those of your Lordships who have great knowledge of agriculture will bear that out.
Mr. Ernest Brown and Sir Samuel Hoare tell us that all these people will be employed sometime in the new year. Our criticism is that, while we are engaged in this terrible struggle for our very existence as a free nation, we are losing the services and labour of these people, this great army of willing workers, for five, six or seven months from the beginning of the war. Amongst the unemployed are 41,000 engineers and metal workers. We are still, unfortunately, losing merchant ships by submarine and mine action. We ought to be building merchant ships as hard as we can, but there are, to-day, shipyards
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and building slips unoccupied. The official reason is that there is not enough labour. What is being done to enrol more labour? There is no trouble on the labour side. The trade unions are willing to take in more men.
These are not querulous complaints. Other noble Lords and members of another place have been pointing out these defects since last September. Because as an Opposition we support the war, that does not mean, I submit, silent acquiescence in mudding or drift. If the Government could not plan the economic side in time for war—I stress the difference—can we trust them (I would like to be reassured on this) to plan in time for peace? Peace may come quite suddenly. I can believe in any miracle with the noble Viscount as Foreign Secretary. What is being prepared to prevent a slump and to find work for the demobilised Service men and the munition workers? What is to be done with the national factories we have erected and are erecting? Are they to go the way of the great plant at Gretna after the last war? Is there an economic plan for the resettlement of Europe? The Prime Minister—I was delighted to hear a high Protectionist talking like this—says that he wants freer trade in the new Europe. I am delighted. I am an unrepentant Free Trader. But are we preparing for that? Is the League of Nations, in which the Government have suddenly taken renewed interest, to be mobilised on its economic side? There is a very fine Secretariat at Geneva with expert people who could be working on this problem. Is the van Zeeland plan to be revised and brought up to date? I submit to the noble and learned Viscount the Lord Chancellor that it is no use saying there is plenty of time for that, and that we must win the war first. With the slowness of movement of Governmental machinery in this and other countries, my Party suggest that there should be a separate body of competent people thinking and planning now for the outbreak of peace.
The task really is not difficult. Despite the waste and ravages of war, this is an age of plenty; the war itself stimulates production and invention. In other words, there will be more real wealth, in spite of the destruction, than when we started. By real wealth I mean skilled

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workers and efficient, up-to-date plant and machinery. We shall have more land under cultivation in this country, I hope, when the war is over. Are we preparing plans to harness the vast energies which will be released after the war to the rebuilding of society on surer and fairer foundations? That is what my Party have been hammering at in another place, and that is what my noble friends and myself would like to ask the Government now.
Perhaps I may be permitted to make a few remarks on the very important speech made by the noble Viscount the Foreign Secretary on Tuesday. He referred to the aggression on Finland by Russia. I want to say at once that we Socialists are more hurt and wounded by this invasion than anyone else. We have always thought in good times and in bad times that the Soviet Republic stood for peace. I hope we shall have sympathy from those who believed in the peaceful intentions of Hitler and rather admired his system and doings up to the end of last August. May I with great respect say how glad I was to hear the noble Viscount, Lord Halifax, say that our main task was to defeat Germany and to hear him reject the proposal to patch up peace on any terms "to save Western civilisation," to quote his words. We say that the way to save the civilisation not only of Western Europe but of North, South, East and West is to prove that aggression does not pay, as my noble friend Lord Noel-Buxton put it in the same debate.
There is talk in certain neutral capitals a long way from the fighting and also in restricted circles in this country, that we must make an alliance with Germany quickly to attack Russia. One trouble in Russia has been that they have feared that there would be a coup d'état in Germany, monarchist or militarist, and that then we should patch up a peace with the new Government—the camouflaged Prussian Government which would replace Hitlerism—and all assail Russia. That is the obsession they have undoubtedly had in the Kremlin and it explains a lot of what has been happening. That policy which, as I say, is being preached in certain restricted circles, will not carry—as I presume the. Government are aware—a large mass of British people with them. It would split the country in two. I do not think this country can ever have been
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so united in war as it is at the present time in the prosecution of the war against Hitlerism and the horrible Nazi-Prussian spirit. But there will be no unity of that kind for a change of enemies, and I hope this fact will be recognised. I hope also that this will be made clear to both Germany and Russia. We have still an Ambassador in Moscow and I presume the channels of communication are still open. I hope they will be used to that effect.
If, as I understand is the Foreign Minister's policy, we spurn this suggestion of "switching the war," I hope also that we will go further and avoid a course which will lead us to fight Germany and Russia together. That is another alternative. There would be an arguable case for sending all possible help to Finland if we have decided that there is a danger of all Scandinavia being overrun, but I suggest with great respect that a policy of drift combined with pinpricks does not make sense. We can have our burst of indignation and then we must think calmly what to do next. So far as I know, not a single aeroplane found its way to Poland from this country before the outbreak of war. Sir John Simon was still haggling with the Poles about a loan to enable them to buy arms when the present war broke out. Yet last night and this morning, on the British wireless and in the newspapers, there is publicity for the sending of twenty British fighter aeroplanes to Finland. Twenty fighter aeroplanes will not make much difference there. They would be better employed guarding the Thames estuary against Nazi seaplanes laying bubble and magnetic mines. They are needed there.
With great respect, that policy does not make sense. We know that nothing would suit the present German régime better than to have this country involved in war against Russia. We shall be navigating very deep waters in the weeks and months ahead of us. My friends have approved of the Government seeking to avoid friction or cause of quarrel with Italy. The Foreign Secretary knows that we think that is a wise policy. We did not object to the recognition of the Italian conquest of Albania, but what Italy did in Albania last Good Friday—I shall never forget the Foreign Secretary's speech on that occasion, with which I agreed—was no worse and no better than what is happening in Finland now from Russia. I say that if we had

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been on better terms with Russia in these last months and years we might have prevented this assault on Finland. I am very sorry to have to say this to the Foreign Secretary: I was very sorry to hear him congratulate himself on having refused agreement with the Soviet Government. I do not want to go over that old controversy, but I am bound to allow myself to say this: that earlier and better handling of those negotiations could have succeeded.
But that belongs to history, including the history of this great second world war. Why was there this Russian desire for the acquisition of strategic positions in the Baltic and Arctic Ocean? I am not approving of their methods. I said at the beginning of these remarks that we Socialists are deeply wounded and hurt by what has happened. But what lay behind it? It was fear of attack from the West, which could only come from Germany or with the assistance of Germany; that is the explanation of it. We were shocked, all of us, and my noble friends in another place especially made very caustic remarks about it when the Red Army walked into Eastern Poland. But, taking the long view, it is now recognised that it was better so for many reasons than that Germany should have overrun the whole of Poland and established a common frontier with Rumania. I am not alone in saying that; the First Lord of the Admiralty has said as much. Taking a still longer view, Russian interests will not be served by a German victory over Britain and France and the consequential increase in Germany's strength and power of aggression. It may be said that a strong Russia may be a menace in the future; but with her vast area, her natural resources and her population, Russia will always have great potential strength. We cannot help that. She may have her confusions and her troubles, but she can always recover. Her area, her population and her natural resources will always make her a potentially strong Power.
Now is it not true that there is no natural clash of interests between Russia and the British Empire? Our interests do not clash in any way. I can see no fundamental cause of quarrel, apart from ideologies, between ourselves and Russia. Our interests clash nowhere. The Russian advance towards the warm waters of the
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Persian Gulf has been stopped. That was the old cause of trouble in Sir Edward Grey's time; the noble Marquess, Lord Salisbury, will remember that very well indeed. That is all removed now, and I can see no fundamental cause of quarrel between ourselves and Russia. I must here speak for myself, but I know I also speak for many other people in the country of all Parties and of no Party when I say that we do not despair of the Russia that emerged from the stupendous events of 1917. In any case, we are fighting inter alia, as the Foreign Secretary said, to create an order of society in which the strong, whoever they are, will not be a menace to the weak, and, in the Foreign Secretary's own words, in which force is recognised as a bad plan. Furthermore, we are fighting for our lives, for without liberty life is not worth living.
In those circumstances, with great respect, we cannot afford more diplomatic mistakes. The record of this Government has been a series of blunders culminating in the Munich Agreement and in the Foreign Secretary's failure to visit Moscow last June, when he was invited and assured of a most friendly welcome. But I do not wish to make only criticisms. As my noble friend Lord Snell has done, I make exceptions, and I compliment the Foreign Office on their Agreements with Turkey and Egypt. These are the two bright spots in the recent handling of British foreign relations. But we are engaged in a life-and-death grapple, and the real fighting has not yet begun. Time is on our side, but not if we add to our enemies and neglect or misuse our economic strength.
4.16 p.m.
VISCOUNT SAMUEL: My Lords, I would ask leave in the first instance to express, as I feel sure I may on behalf of all noble Lords on these Benches, our general concurrence in the speech that was made in the earlier stage of this debate by the Foreign Secretary. Indeed so far as I am concerned I would go much further than general concurrence. As behoves a member of an Opposition Party, I not only listened with great attention to the speech of the Foreign Secretary, but also carefully read it through afterwards with a critical eye in order to find passages which might give ground for legitimate criticism. I am glad to say that I was disappointed and was able to find none. I do not concur

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in the grounds of criticism that have been expressed by the noble Lord who sits on my left. I was particularly glad that the Foreign Secretary emphasized what had already been said by some of the previous speakers: that in discussing war aims and peace aims we must get out of the habit, into which some people in this country have fallen, of assuming that this is a matter for ourselves alone. France and our other Allies and the Dominions must be completely agreed; and I would add that our efforts should be in consonance also with Indian opinion, which is sometimes forgotten in this connection.
We share also the sentiments expressed by the noble Viscount the Foreign Secretary of sympathy with Finland in the presence of the dastardly attack that has been made upon her, and our great admiration of the fortitude and courage with which it has been withstood. This is another example of the new Tsarism which has been established in Russia. From Germany we expect frank cynicism in foreign affairs; they have never pretended to adopt any other policy but one of sheer cynical power politics. But in Soviet Russia for many years past we have been accustomed to hear all the vocabulary of internationalism and humanitarianism. Now to find this unprovoked and unpardonable aggression really makes our gorge rise. The present Russian view of international fraternity seems to be based upon the old principle, "Be my brother or I will kill you." No doubt this will come as a great shock to all the sincere idealists, particularly among the younger generation, who have been attracted by the Communist creed and who have held Russia in great admiration. I trust that they will now see that their hopes and forecasts have been mistaken through error of judgment on their part. The noble Lord who has just spoken referred to the possibility of some sudden volte face in our national policy and a combination with Germany against Russia. I am not sure it is worth while to discuss that contingency. I feel sure that it is not even on the political horizon, and that no one of the slightest weight in this country would contemplate such a contingency, least of all any member of His Majesty's Government.
In general I believe that the nation, so far as one can presume to attempt to
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gauge public opinion, views with a feeling of confidence the administration of foreign affairs by the noble Viscount the present Foreign Secretary; and on the whole I think the nation is satisfied that the military side of the war is also in safe hands. But when it comes to the economic side, the general feeling, I am sure, is quite different. There the voice of criticism is heard, and loudly heard, and with good cause. In fact it is not too much to say—and here I fully concur with the noble Lord who has just spoken—that there is grave and general dissatisfaction. Governments, like Generals, must be judged by results. They win their battles or they lose them, and if they are losing their battles they will be condemned, even though they may say that in many respects circumstances have been against them.
With respect to employment, to which the noble Lord, Lord Strabolgi, has referred, we have now a million and a quarter of men under arms; hundreds of thousands have been called up; we have a Government expenditure of £6,000,000 a day; and yet there are still 1,400,000 workers unemployed—170,000, as I calculate, more than at the outbreak of war. Mr. Clement Davies, a Member of Parliament known to many of us, wrote a very able letter on this subject in The Times a few days ago in which he gave some examples of the kind of people who are now unemployed. The noble Lord who has just spoken also gave some illustrations. I would quote others. There are 64,000 miners unemployed; there are 32,000 in the engineering trades; there are 18,000 shipbuilders and repairers; there are 34,000 cotton workers; and there are 56,000 other textile workers. All this cannot be understood by the public—how such a thing can be—and they are bound to come to the conclusion that there must be mismanagement somewhere. One error, I venture respectfully to say, and I have said it before in this House, was in the Budget, in imposing so heavy and sudden an increase in the Income Tax at one blow. It was heroic but it was unwise. If the increased taxation had been imposed more gradually, I believe the conditions of employment would have been less unsatisfactory than they are today. But of even greater importance is the continued low level of our exports. No doubt shipping and other international difficulties have much to do with it, but

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those are not the only causes. Our exports, as we know, are 40 per cent. down compared with pre-war and they remain at that level. This is a very grave matter, particularly with regard to the value of sterling and the maintenance of the dollar exchange—a matter of immense importance if we are to make large purchases of military materials from America, as we are now permitted to do, but only for cash.
May I here interpose this observation, that we can now see how serious the consequences have been of the handling of the American Debt question? For many years past, for my own part, if I may venture to use that unpleasant and unwelcome phrase, "I told you so." I initiated a debate on the American Debt question a year or two ago and repeated my plea on other occasions, and have done so before when I was a Member in another place. I consider that the handling of the American Debt situation has been one of the major errors of policy of this country in recent years. But as conditions are, we are forbidden now to borrow money in the United States, as we did in the last war, and that must impose great financial difficulties. The maintenance of the value of the pound in relation to the dollar is therefore of great importance, and here the question of increasing our export trade is of course the vital factor.
The Economist newspaper, a very ably-conducted and impartial journal, said this a few days ago:
"It cannot be too often reiterated that Great Britain must export or die, that the present state of the export trades is disastrous and that not nearly enough is being done about it. It is our worst failure of the war, and will bring down all the rest unless drastic action is taken at once."
We know some of the causes of this partial collapse of our export trade. Two noble Lords on these Benches, my noble friend Lord Rea and my noble friend Lord Gainford, have lately referred to this matter fully and in some detail in this House. My noble friend Lord Rea, in a very forcible speech a week ago, mentioned among other things that the Presidents of the Anglo-French Chamber of Commerce and the French Chamber of Commerce in London had complained bitterly of the harassing restrictions that are still imposed on the interchange of
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goods between France and this country. My noble friend gave a number of other concrete instances.
Lord Gainford, in the earlier stage of this debate, mentioned that about a year ago he attended with the President and a past President of the Federation of British Industries, the most representative body in this country, as a deputation to the Prime Minister, and he said that they pointed out at that time that it was the duty of the Government to make arrangements in advance of a possible war to deal with the expansion of exports. And my noble friend went on to say:
"Now we find after nearly three months of war that very little has been done to stimulate the exports of this country, and we are very apprehensive because unless the Government have the matter in hand we shall be in a very parlous condition."
But even more striking was the outburst of Sir Warren Fisher a day or two ago, which was just briefly mentioned by the noble Lord, Lord Strabolgi. Sir Warren Fisher, as we all know, was Secretary to the Treasury for many years, and head of the Civil Service, and he is now the Regional Commissioner for Lancashire and the North-West. These are his words:
"In economic strength we started with an advantage, but it was not so great an advantage, and our resources were not so immeasurably superior to the enemy's that we could afford to misuse them. We are doing that good and hearty. We are finding the industries of this country interfered with by controllers, sub-controllers, and sub-sub-controllers, appointed all over the place, showering spanners and monkey wrenches into the industrial machine; our export trade interfered with and handicapped in every possible way. By our export trade we live, and by its maintenance alone can we succeed."
We are right to take all the steps that we can to stop the exports of Germany, but to stop our own exports is surely the height of folly; and that can be done by badly administered Controls. In fact it is not too much to say that a bureaucrat can do as much harm to our own trade as any U-boat. The fact is that all the world sees that at the present time there is no clear-cut, firm, effective direction from the Government of the economic affairs of the nation. Contradictory advice is given by different Ministers. The Chancellor of the Exchequer tells the nation that they must not spend but save and lend. Other Ministers, Sir Samual Hoare, for example, say that, so far as possible, people should maintain

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normal buying so as not to cause more unemployment. It is true that that was said two months ago, and circumstances may have differed since then, but, so far as I know, that advice has never been withdrawn, and the public do not know what to do. We are now in the full Christmas shopping season. "To buy or not to buy, that is the question," as Shakespeare very nearly said. And the public needs guidance. Mr. Keynes has suggested a plan of compulsory saving so as to prevent people buying and to ensure that they shall save. Well, that scheme, although ingenious and in some respects attractive, is open to obvious and very grave objections.
But the public are only anxious to do what they can to help. They would be willing to abstain from spending and to save and lend if they were told that that was the right thing to do, or they would be willing, most of them, to follow guidance if they were told that they ought to spend in order to promote employment; or they would be willing to follow advice, I am sure, if they were told that in some directions they should spend and in others economise. But they wait for guidance from the Government, and no guidance is given except of a confused character. It is not sufficient that the noble Lord, Lord Stamp, in whom we all have great confidence, should have been appointed as Economic Adviser to the Government. We need some Minister of the highest authority in the War Cabinet who shall co-ordinate all the Departments which are concerned with these matters, and who shall take resolute, definite and swift action to remove the Controls that are not necessary and that interfere so gravely with our export trade, and thus guide the public action with respect to these economic matters. That, I venture to say, is the weakest side of the present administration, and it is for the Houses of Parliament, both of them, to demand and to require amendment.
4.32 p.m.
VISCOUNT TRENCHARD: My Lords, when I was here on Tuesday and listened to the speeches of several noble Lords I was perturbed. They recalled the speeches of impracticable idealism which we so often heard before the war. To hear them again after war was declared filled me with anxiety, because if any-
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thing has brought us to this pass it has been all the idealistic talk which we have heard so often in this country. But as we listened to the two great speeches of the noble Lords, Lord Stonehaven and Lord Crawford, I could not help thinking, "Those are the speeches that will be understood by the ordinary Englishman." They were practical and true, and I felt that what those two noble Lords said represented what 90 per cent. of our people feel. But I was amazed, and I could barely believe my ears, when I heard the speech of the former Lord Chancellor, Lord Maugham, who used language which I so thoroughly understand and agree with in saying that it was crass stupidity to think that anything short of security would satisfy the French. That was language that we all understood.
The noble and gallant Field-Marshal, Lord Milne, in his speech in the debate on the Address, remarked:
"We are said not to be fighting the German people. That is a very dangerous theory."
Further on he said:
"…though we may think that we are not fighting the German nation, I can assure you, my Lords, that the German nation are fighting us, and they are a very stubborn lot."
The idea that we are not fighting the German people has been spread and fostered in many speeches, and by some which we have heard in the debate on this Motion—that of the noble Lord, Lord Snell, especially, and the noble Viscount, Lord Cecil, who is not here to-day. That idea has been repeated up and down the country, and as the noble and gallant Field-Marshal said, it is a dangerous idea. Hitler and his Government are the representatives of the German people. It is the German mentality, for the Germans are not idealistic, they are materialistic. There may be a few thousands in Germany who are more broad-minded, but we have to face the fact that we are at war in order to destroy that mentality. Nothing but defeat of the Germans in their own country will bring that about. If Hitler and his Government were overthrown to-morrow, I dread what might happen. If we made a peace on idealistic lines straight away, we should have this menace again, because there would be another Hitler, or another German Emperor.

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The noble Lord who introduced this Motion, Lord Snell, said that the aim of war must always be to win it in the shortest possible time. I thoroughly agree with that, and I sometimes feel when I listen to speeches elsewhere that we think there is something sound in making it a long war. Is there? I doubt it. But then the Leader of the Opposition also said:
"…We are always afraid that whenever the pinch begins to be felt the Social Services will be the first economy that will be made."
But if you agree that the first aim in this war is to get security against aggression, then I hope the first economies will not be made at the expense of that security by sacrificing the fighting Services. Without that security you cannot have the Social Services. Nobody is keener on improving them than I am, but I am perfectly certain that they are put back many years by our having to fight a war like this again within twenty years of the last because we have not got security.
The most reverend Primate referred to the question of reprisals, and I saw in the newspaper the next day the words "Reprisals Condemned." Speaking from a military point of view, I am equally against reprisals. They show that you have lost the initiative. But all our actions should be undertaken with the aim of making the war as short as possible, and thus saving thousands of lives and years of misery. War is a brutal thing—everybody admits that—and if we say we will wage it humanely, we lengthen it. It cannot be done; and the longer it goes on, the more war becomes inhuman. A noble Lord who spoke from the Front Opposition Bench referred to war aims, and assumed at once that certain things were bound to be included in them. Did not that justify the Government in their refusal to define our aims, except so far as to say that we want security and we want to stop aggression? A more dangerous remark than that at the present time I cannot think of.
I would like to refer to the speech of the noble Viscount the Foreign Secretary. I am glad that he mentioned the negotiations with Russia. What I understood from his speech to be the chief reason for their breakdown was that we were asked to be a party to the obliteration by Russia of a number of small States in order to help our own cause. Yet the majority of
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the people in this country were at the time pressing the Government to come to an agreement with a nation that was wanting to do this. I say that, if anything, the Government were too quixotic in their desire not to embitter relations with Russia by disclosing this fact earlier so as to make it clear what sort of bribe we were being asked to give in order to get assistance. I hope this lesson will be learned in the country. With regard to the end of the Foreign Secretary's speech, I should like to have seen him alter one phrase. He referred to the "conditions created by the present rulers of Germany." I would rather he had said "the conditions created by the German mentality." I have friends in Germany, and I do not want anybody to think that I desire the destruction of that nation, but we know that after we have been victorious and won the war, as we shall win it, we shall have beaten the German nation and not only the German Government. Then we must be fair in every way, for they are a great nation. The only thing we must guard against is insecurity, and all the rest will come. Finally, I should like to pay my tribute to the young men and pilots in the Royal Air Force for their wonderful efforts, their keenness, their skill, and their bravery. I feel they are not only keeping up the reputation of those young pilots who fought in the last war, but they are doing their level best to enhance it, and I am sure they will.
4.42 p.m.
LORD ADDISON: My Lords, everyone of us would wish to be associated with the tribute to the men of the Air Force contained in the last sentences of the noble Viscount's speech. I am rising for a few minutes only to call attention to certain of the economic implications of the Motion which is before your Lordships' House, and to reiterate, what is self-evident, that every one of us is in agreement with the Foreign Secretary that nothing is possible in the way of peaceful development here or elsewhere until the terror that is over Europe is destroyed. There is no inclination anywhere that I know for anyone to escape from the obvious truth that the cause of this terror, which has been imitated by Russia in this deplorable and ghastly manner, is the Government of Germany. Until that terror is overcome, there is no hope for any of us. We all accept that.

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The more modest purpose for which I am rising for a few minutes is to look more closely at ways and means from the economic side. We are told, truly enough, that we cannot win the war only by our Forces, but also by our trade, by the maintenance of civil life and the contentment and prosperity of the people. It was only the other day that I made a speech on this subject, and I shall not repeat it except to say that I should like once more to associate myself with what was said by Lord Rea last week and Viscount Samuel to-day on the terrible confusion which is being spread in industry by the chaotic system of so-called control which is, in fact, fostering the disorder which has been invented or introduced by the Government. I have described previously the method of operation of different Controls under the supervision, presumably, of the Minister of Supply. So far as one can ascertain, it is almost impossible to exaggerate the unnecessary difficulties which have been placed in the way of the conduct of ordinary business from one end of the country to the other. Like the noble Viscount, I am not in the least consoled by the fact that Lord Stamp has been appointed to some new office among the numerous other offices he occupies or is alleged to occupy. It is no satisfaction, I am quite sure, to anyone who understands what is the trouble. This is a matter in which a first-rate Minister, a member of the War Cabinet, should be responsible for introducing order where there is chaos. It is quite outside the powers of Lord Stamp, whatever may be the high-sounding title of the post to which lie has now been appointed. It is a job for a Minister and for the Government themselves.
The figures which have been mentioned point to an inescapable conclusion. Here we have, as Lord Samuel said a few minutes ago, a million and a quarter men taken by our various fighting Services, and I imagine that, in addition, we ought to add all those who are on whole-time work on A.R.P. and suchlike. If we do that, there must be little short of 2,000,000 men abstracted from producing work, and still there are nearly 200,000 more people out of work and receiving unemployment pay than there were before the 2,000,000 people were abstracted. That is a most amazing, a most discon-
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certing fact. True, the war has only been going for three months, and therefore it is not reasonable to expect that in three months the country could have adjusted itself and recovered from the inevitable dislocation of business to which war must give rise. That is clear, but a dislocation of this magnitude is something which no one I know of foresaw. It means that you have taken 2,000,000 people out of some kind of occupation—they were doing something—and still you have got more people without any work than you had before, although Ministers are telling us that a maximum national effort is required for war purposes.
LORD MANCROFT: Will the noble Lord allow me? I am not contradicting him at all, but we ought to straighten out these unemployment figures so that we do not deceive ourselves. It is said, and truly said, that there are 1,400,000 persons out of work. In the first place, however, there is no question that one must deduct from that total 80,000 to 100,000 people who are not seeking work. They represent people who register on the unemployment lists in order to get their old age pensions. The second point is this. Half of these persons, as was made clear in a speech by the Minister of Labour on March 2, are out of work continuously for under six weeks only. They are not perpetually out of work. They may be changing from one occupation to another. The third thing, and it is always forgotten, is that it was stated in the Report of the Royal Commission on Unemployment that from 600,000 to 800,000 would not get work at any time because they were unemployable, deficient physically or mentally. If, therefore, the noble Lord talks about 1,400,000 people out of work, he must recognise that the real unemployment problem concerns not 1,400,000, but something like 700,000. If we do not recognise that, we deceive ourselves, because 600,000 of these 1,400,000 on the register can never be employed owing to their unfortunate personal disabilities.
LORD ADDISON: I am sure I welcome the intervention of the noble Lord, because anything which contributes to a clarification of this grave matter is helpful, but the point I wish to make in reply to him is this, that all the circumstances to which he referred prevailed before. There is nothing new in any of them. They existed, as he says, at the time of

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the Royal Commission, and they have been ingredients in our unemployment figures all the time. Therefore the war, so far as they are concerned, has introduced no change. Allowing for such figures as constant factors more or less, still we are confronted with the equally ugly fact that, although there is theoretically this immense demand for work in war services, and although you have extracted 2,000,000 more or less able-bodied men—because they have to be able-bodied men—and put them into the various branches of national service, you still have this swelling of the numbers of unemployed people. And they are not old people; they are not decrepit, they are people who have come in since the outbreak of war. Nearly all are men and women who have lost their jobs, and anybody who visualises, as I know the noble Lord does, the exodus from our cities and the enormous dislocation of industry that the war has occasioned will understand where the additional number has come from. I see, for example, there are not less than 144,000 people unemployed in the building trade.
LORD MANCROFT: That is seasonal.
LORD ADDISON: They are not old age pensioners, and they are not children; they are bona-fide people employed in the ordinary way in the building trades, and 144,000 of them are out of work.
LORD MANCROFT: Seasonal.
LORD ADDISON: The point I am trying to emphasize is this. We are confronted at this very early stage of the war with this immense volume of unemployment, and for my part I see no hope of their re-employment in the short time visualised by the Lord Privy Seal so long as present methods of dealing with employment outside war service, and even inside war service, is persisted in. I referred to this the other day so far as the Ministry of Supply is concerned, and it would be improper to repeat my observations, but I would like, if one may, to carry this examination of the case a little deeper. Even if we get all the harmony we should like to have in the Controls, if we get the system of obtaining employment for the Ministry of Supply working as easily as we should like it to work, if it could all be as well managed as the Ministry we are talking about could
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make it, I still think we should have a large volume of unemployment in this country, and I suggest that we should deceive ourselves if we thought that we should not be confronted with this problem even on a vaster scale when we are victorious. I take it that we shall be victorious; we all take that. I am suggesting to your Lordships that at the best, with all the good management that could be imagined, we shall in fact be confronted by a much larger volume of unemployment at the end of the war.
I know it is early days, I know nobody can foresee the conditions, but I suggest that it is the first duty of the Government to examine that problem as an ingredient in their war and peace aims, because Hitlerism arose out of a discontented, frustrated nation. There would have been no opportunity for Hitler to develop his campaign, there would have been no enthusiasm behind it, had it not been that in Germany there were from four to five million people out of work, and an immense volume of discontented young men feeling frustrated and hopeless. That is the plain English of it. That is where the followers of Hitler came from, and he would not have had any chance without them. I suggest that it behoves our statesmen to look at that side of the war aims lest we ourselves in the future should be in as bad a plight. I am not going to talk theoretical Socialism, but it seems to me inescapable that, as the world is developed, the machine is becoming our master. You are now producing vastly more munitions per man-hour than you were in 1917 and 1918 when we developed our factories to the best that was then possible. We can now produce a much greater volume of output with a much smaller employment of man-power than we did twenty odd years ago, and that is going on every year. For my part I cannot think that there is any escape from the conclusion that when we have won the war we shall be very foolish if we imagine we can then sit back contented and believe that all is going to be well.
I think myself the prospect may indeed he very grim, and therefore I am suggesting that at this early stage it behoves the Government to enlist the services of men of good will to look into these social and economic problems which inevitably will emerge, possibly in a graver form, even if we are victorious. I am not going to

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weary your Lordships by airing any of my own theories or the reasons for them, but I am quite sure that we have got to fashion a different form of life, a different series of rights and obligations, attaching not only to national sovereignty but to the ownership of property and the use of it; and until we do we shall be presented with this problem which is rotting the root of society in every nation more and more. I do not know whether the Government will turn a blind eye to it; I hope not, for I am perfectly certain it is as big and dangerous a problem as the war itself. Nothing was more disappointing to many of us at the end of the last war than that a blind, unthinking reaction possessed people and set at nought all the proposals which men of good will of all Parties had tried to fashion for our national benefit to be made use of after the war. I hope we shall never make that mistake again. It is in order to express that hope that I have intervened for a few minutes on this occasion.
5 p.m.
THE LORD CHANCELLOR (VISCOUNT CALDECOTE): My Lords, the few occasions upon which I have had the privilege of addressing your Lordships' House were so different in interest and importance from this afternoon's debate that perhaps I may be allowed to crave the indulgence which your Lordships would give to a newcomer addressing your Lordships for the first time. My noble friend the Foreign Secretary on Tuesday informed your Lordships that I should attempt to deal with the latter part of the Motion which the noble Lord, Lord Snell, then moved. There have been some references to-day to the questions which my noble friend the Foreign Secretary answered. I hope I may be excused from attempting to embroider the answer which he gave upon those questions. It would be presumptuous on my part to add to, or even to repeat, what my noble friend said. I listened, with a little difficulty in understanding, to what the noble Lord, Lord Strabolgi, said on the question of Russia and Finland. I gather that he thought that after some caustic observations with a large explosion he and his Party should relapse into quiet watching of whatever was going on, and he was inclined to complain that a provision of aeroplanes, which he had seen mentioned in the Press, presumably by private manufacturers,
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was different from the way in which Poland was treated. It would be perhaps foolish on my part if I attempted to make any commentary on what the noble Lord said on that question.
My noble friend the Foreign Secretary was able to say, as indeed has been confirmed by the noble Viscount, Lord Samuel, to-day, that there was a fundamental basis of agreement on the questions which the Foreign Secretary discussed. I cannot, I am afraid, make the same assumption with regard to those questions which have been chiefly discussed this afternoon. Looking at the Motion which has been moved by the noble Lord, Lord Snell, I find that he declares there is "urgent need for a wisely-planned programme of national economics and social reconstruction." I think I am justified in saying that there is perhaps some uncertainty in the minds of some of your Lordships as to the meaning of the words "national economics," but I imagine all of us are agreed upon the necessity for wise planning.
The noble Lord who has just spoken rightly said that the war, whatever its length, will have a great impact upon our social system, and in so far as it is possible it is undoubtedly the duty of the Government to take time by the forelock and look forward to the conditions which will arise at the end of the war. But the noble Lord, Lord Snell, claimed that no solution was likely to be satisfactory unless it was based upon Socialist lines. The noble Lord is doomed to disappointment if he thinks this Government are likely to undertake an inquiry or to make plans which are consistent with the view that salvation is only to be found in that resource. It would be unprofitable to pursue that topic this afternoon, but I think I may fairly claim that the Government have not shown themselves unwilling to adopt measures in this war which some noble Lords might think, with reason, savour too much of Socialism. The one object of the Government, I hope I may say, even though they may not always have achieved it, is that the measures should be those which are best needed in the public interest.
I find myself in agreement with the noble Lord, Lord Snell, in his enumeration of the problems which we have to face. Unemployment, both now and in the future, higher education, export trade,

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our financial resources are all of undoubted urgency and importance. Your Lordships will forgive me if I remember, without commenting upon them, one or two other questions to which this war is certain to give rise—questions of great significance in their influence upon the life of the nation and possibly even upon the future of our race. The home life of our children has been greatly disturbed, and will be disturbed, by this war. The basis of Christian instruction upon which our social fabric is founded must be preserved. These are examples of subjects which deserve the attention of thoughtful men and women as soon as they can devote themselves to such matters.
So far as education is concerned, I am bound to say that I thought the noble Lord, Lord Snell, departed a little from the high standard of fairness which it is his accustomed practice to preserve. He described the attitude of the Government towards higher education as that of a person saying "Here is a young life at the university or elsewhere, let us get it into the trenches at the earliest possible moment." That is removed far from the actual facts of which most of your Lordships are very well aware. Not only was a register prepared before the war began of persons with scientific and technical attainments, but use has been made of that register to place 4,000 such persons in positions requiring special qualifications. At the universities, boards and technical committees were established on the outbreak of war to deal with undergraduates and resident graduates under twenty-five years of age who had special fitness for commissions in the technical branches of the Services, or if not in the Services for employment in connection with civil requirements. Care has been taken to enable these boards and committees to recommend the completion of the studies of undergraduates before using them either in military work or in the Civil Service. Has the noble Lord forgotten that medical students are reserved as an entire class? There is no attempt to hurry them into the trenches. Nor has there been any diminution in the grants which the Universities Grants Committee make to the cost of higher education. The Government have decided that the same grants shall be paid as in former years. University dons and other teachers over the age of twenty-five are
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also in a reserved occupation. Indeed, I should have thought, if the facts were known, that anybody would come to the conclusion that the Government, both in advance of the war and in execution of measures since war began, have been peculiarly careful to make use to the best advantage of the scientific attainments of the youth, of the younger generation, at our universities.
One of the questions most discussed this afternoon has been the important and ever difficult question of unemployment. I think I am right in saying that it was unemployment after the war that was in the mind of the noble Lord, Lord Snell, rather than unemployment at the present time, although he did mention that. Most of us have a lively recollection of the unemployment that unfortunately developed very soon after the end of the last war, but that is a problem rather different from the question of the recruitment of the 1,400,000 persons who are now registered as without work. Perhaps I may be allowed to make one comment on this question of figures to which the noble Lord, Lord Mancroft, referred a few minutes ago. The noble Viscount, Lord Samuel, said that about 18,000 shipbuilders are out of work. I well remember when I held another office having the most elaborate examination comb-outs of these figures of what might be supposed to be skilled workmen. We found in practice that there is always a residue of persons who register themselves as belonging to skilled occupations, but that a very small proportion of them are capable, at any rate without fresh training, of taking their part in the industry to which they profess to belong. I suggest to the noble Viscount, Lord Samuel, that if he would make further inquiries he would find that no man at the present time in the shipbuilding industry need be out of employment if he is able to come forward with the skill that justifies him in asking for immediate work.
So far as unemployment in the building trade and in the mining industry is concerned, there are at the present moment difficulties which of course must be overcome, but which it would be beyond the powers of anybody to overcome immediately. The building trade suffers largely from a shortage of material; in the mining trade it is very largely a question of sufficient means of transport and of distribution. If these difficulties

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could be overcome, as I say again they should be overcome if it is at all possible, I have no doubt that more people will be diverted into employment from this unhappy regiment of unemployed persons. Surely the export of coal is one of the ways in which we can help the exchange of which the noble Viscount, Lord Samuel, spoke.
If I may say one word about planning for the unemployment which the noble Lord, Lord Snell, contemplates at the end of the war, I should I think be justified in saying that it hardly seems possible to bend one's back to a task of that sort when we are by no means certain either of the length of the war or of the conditions that may exist at the end of the war. The noble Lord, Lord Addison, said, I think, a few minutes ago that we did not know when the war would end—which, of course, is obviously true; nor do we know the conditions under which we shall find ourselves. After only three months of war I should have thought that the immediate task was to devote our attention to winning the war and, of course, to absorbing the 1,400,000 persons who are now unemployed.
LORD STRABOLGI: Would the noble and learned Lord Chancellor forgive me? In raising this matter we did not propose that the present War Cabinet or the present Government should take on this task. They have more than they can do already; that is obvious. We want outside people of competence, who surely exist in the country, to be given this task, as indeed was done in the last war.
THE LORD CHANCELLOR: As the noble Lord has said that, it enables me to cite, I hope with appositeness, a passage in a volume written by the noble Lord, Lord Addison, in reference to his efforts at reconstruction immediately after the war. I know that he and those who think with him are accustomed to place the responsibility for failure after the war upon those who failed to carry out his admirable proposals; but this is what he thought at the time of the difficulties that would face anyone who would plan for these matters in the course of the war:
"It was a common practice with some publicists at that time, amongst which the late Pall Mall Gazetta was most prominent,
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to represent that the Ministry of Reconstruction during the course of war was to put all kinds of developmental projects into operation. Our national business during the war was to win it."
I agree with the noble Lord. Then he went on to explain that in July, 1917, his plans for reconstruction were very difficult to make:
"The first question…was how to set about the examination of these things as the preliminary to framing plans for dealing with them. There was one serious drawback, and there were two substantial advantages. The drawback was that, whichever way one turned, the people who had the knowledge and who could give the most effective help were already as busy as could be. The different war departments had laid hold of capable men and women everywhere, and I myself at Munitions had been responsible for a goodly share. Apart from this, the immense activities of the war called for the very best that could be obtained from those who remained in industry after the insatiable demands of the war services had been met."
The position to-day is very like that, and I am not surprised, therefore, that the noble Lord, recollecting his experience as he did a few minutes ago, said that these were early days to make such a proposal; but still he made it. It is a difficulty which everybody would have to face who thought of collecting a staff of the eminent, skilled and experienced persons who alone could be gifted with the qualities which are necessary to make a success of a Ministry of Reconstruction.
LORD ADDISON: Might I with great respect interrupt the noble and learned Lord Chancellor? Notwithstanding those difficulties which I pointed out so truthfully, we did with great perseverence set about the job and did enlist the aid of a large number of men of all Parties, as I have said. It only shows that a recognition of the great difficulties indicated the need for making a start in time rather than putting it off.
THE LORD CHANCELLOR: Of course, the whole question is what is the right time at which to undertake these tasks, and I venture to think that three months after the beginning of a war, which may be a long war or may be a short war, is hardly the time in which to gather together a collection of men who will be dealing with conditions which are as yet unknown.
A great deal of attention has been devoted to our export trade. I share to the full the opinions which have been ex-

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pressed by noble Lords this afternoon as to the importance of our export trade. We are all well aware of the impediments and distractions which the importer has at present, or has had in the past few weeks, to overcome. A series of well-informed letters and articles in the Press have provided critics of the Government with plenty of ammunition. I expected the reference to Sir Warren Fisher's "outburst," as somebody called it a few minutes ago. The first step towards providing a wise amendment of the present system is to understand, or at any rate to appreciate, the causes which have led to a shrinking of our export trade. Nobody could deny that the dislocation of trading systems, which was an inevitable and immediate result of a world war, was a cause of diminished exports. But the next cause is not so generally appreciated. The establishment of a series of checks and controls, which are no doubt exasperating in the last degree to traders, is of vital importance in the economic war. It is as important to prevent commodities and manufactured articles from reaching Germany, indirectly or directly, as it is to establish a system which will prevent contraband trade by neutrals from going to Germany. But the establishment of Controls, however ill they may have worked in the first weeks of the war, is certainly a necessary part of the system which we have to establish to fight the economic war successfully.
I agree, of course, that the delays in obtaining licences must have aggravated the difficulties which in any case would have existed. I do not for a moment resent, nor do the Government resent, the criticisms that have been made; nay, more, I hope that advantage will be taken of the criticisms. Some amendments have already been made: the Department of Overseas Trade has been reorganised so as to enable traders to know that there is one place and not half a dozen different Government Departments where they may obtain the necessary advice and help. And it is very desirable that traders themselves shall engage in some organization by which the multiplicity of inquiries may be reduced. If the traders will co-operate in this respect it will hasten the improvement which we should all like to see. Some reference has been made to the appointment of Lord
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Stamp, but what I think has been overlooked is that, rightly or wrongly, instead of appointing a Minister who is to be in charge of the co-ordination of all questions relating to export trade, there has been set up a Ministerial Committee over which my right honourable friend the Chancellor of the Exchequer presides, and at the present time a statement is being prepared, for the guidance of Government Departments, of the principles upon which our export trade shall be carried on and controlled, in so far as control is necessary, which will, I hope, materially improve the position.
May I say one word about a subject which has been mentioned, though not in debate this afternoon, because I think it is of some general interest to those who are concerned with the success of the economic war? Pre-emption has been mentioned repeatedly in the criticisms to which I have referred, as if pre-emption were a policy of which the Government had not yet begun to think. I can assure your Lordships that the Minister of Economic Warfare is not blind to the advantages of what is described under this phrase. He appreciates the advantage of buying goods to deprive the enemy of the use of them, and he appreciates the advantage of developing trade with certain countries in order to counter German economic influence, which is one of the ways of diverting supplies which Germany finds necessary for the conduct of the war. I could not be expected to give details either of such purchases as have been made in the past or are likely to be made in the future; that, of course, would defeat the very object of such arrangements; but if a Reuter telegram which I have observed is true, it shows that the Government has been much more active than some critics of the Government would appear to think.
This is a telegram from Berlin on December 5:
"A warning that Germany will not tolerate 'indirect participation in Britain's economic warfare' by the agriculturists of South-East Europe is uttered by to-day's Berliner Boersen Zeitung. The paper claims that Britain is infringing on Germany's 'sphere of influence' by selling at lower prices than German exporters, by raising the price of goods that Germany wants to buy, and by buying all the available stocks of commodities that Germany requires."
If information of that sort has reached Germany, I hope we may encourage our-

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selves to think that the Government have been doing good by stealth, and that the success of their economic and of their export trade systems may perhaps be more readily recognised.
A number of other subjects have been raised, but I ought not to weary your Lordships with a further detailed reply to some of the questions that have been mentioned. The noble Viscount, Lord Trenchard, dealt, with his great authority, with questions concerning the conduct of the war. Perhaps, as it would be impertinent of me to express any opinion on this occasion upon that subject, I may be allowed to join with him in the words which he used of the efforts of the young pilots of the Royal Air Force. One of the most magnificent parts of the present war has been the devotion and skill and courage of these men, upon whom our daily protection depends.
Reference was made by one noble Lord—I think it was the noble Lord, Lord Strabolgi—to idleness in the shipyards. I should be curious to know where facilities exist for the construction of ships, with both plant and work-people, which are not in use to-day. It is indeed an example of the forethought of the Government to find that many of our slips are occupied with ships which began to be built in the days of peace upon a very large scale indeed. It is partly for that reason that my right honourable friend the First Lord of the Admiralty is able from time to time to point to the fact that we are making up, and shall make up in the future, our Mercantile Marine strength by ships which come fresh from the shipyards.
I hope it will not be thought for a moment, in so far as I have ventured to criticise and attempted to meet what some noble Lords from the Opposition have said, that in any way I disparage the importance of the questions which they have raised. The noble Lord, Lord Snell, claimed on Tuesday that his Party had helped to sustain the Government in the great burden they have to bear. I am sure that that is the noble Lord's constant desire, and it would be untrue and ungrateful if I suggested for a moment that his claim is not justified to the full. The noble Lord and his Party have helped to keep the country steady and quiet, but resolute and unyielding, and united by the common purpose described by my noble friend the Foreign
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Secretary. We are strong to-day, and we shall be stronger. To-night's debate may serve as an example of the frank discussion that is possible only in free countries. Criticism has been made, and I hope met, with but one single object, the welfare of the State, and there has been no fear of misunderstanding or of repression in this country, or indeed of misunderstanding abroad. That such things are possible I venture to think must encourage us as we persevere in our task until we reach the inevitable victory.
5.28 p.m.
LORD SNELL: My Lords, it is not in the tradition of your Lordships' House that the mover of a Motion should make a controversial reply after the replies of the Government have been given. Therefore I propose first of all to thank the noble Viscount the Foreign Secretary and the noble and learned Viscount on the Woolsack for their replies and then to ask your Lordships' permission to give one or two words of explanation. In spite of the many doubts that have been expressed as to the wisdom of talking about peace aims at the present stage of the war, the debate which has taken place has been one of exceptional interest and quality. I think I can scarcely remember a debate more worthy of a serious occasion; and if the Motion had done nothing else than to secure the speech of the noble Viscount the Foreign Secretary, it would, I think, have justified its being put upon the Paper.
I want just to explain my position, in answer to one or two criticisms that have been made. The noble Earl, Lord Crawford, appeared to deprecate the introduction of the controversy as to peace aims at the present time—and I know all the difficulties. And then the noble Earl proceeded at once to provide what I thought a most excellent set of peace aims on his own account. The noble Viscount, Lord Stonehaven, took occasion to suggest that Socialism was embodied in living strength in Russia and in Germany. It is not the first time in history when a word of high meaning and of useful purpose has been seized upon by people for their own use, and to its disadvantage. I do not want to end this debate on a note of gloom, and therefore I hope the noble Viscount will forgive me if I say that if ever the day cames when the word "Toryism" is seized upon to be used, that will indeed be a matter of some significance.

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The one argument that I thought really important was that it might be misunderstood if we began to talk about peace aims without the fullest recognition that we have great Allies and Dominions to consult. I think that really is important. But at the same time we must not assume that in France and in our Dominions people are not themselves engaged in these same serious discussions; and I cannot help feeling that whatever thoughts we may develop can be correlated at the proper time. That will be much better than going to a conference table with blank and unprepared minds. Finally, I hope the noble and learned Viscount the Lord Chancellor will permit me very
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sincerely to congratulate him upon his "maiden" speech in the House, and to say that it had a very welcome familiarity from old controversial days. He said that we must not expect any Socialism from the Government, and I must accept that as being well and truly meant. But I beg to point out, in closing, that the activities of His Majesty's Government at present are definitely Socialistic—national factories and dozens of other things; and it is the one thing that is commending their activities to the nation at the present time. I must close on that note, and beg your Lordships to permit me to withdraw the Motion.
Motion, by leave, withdrawn.
House adjourned at twenty-six minutes before six o'clock.