London, Aug. 4.
IS week the Finance (No. 2) Bill will come up for its second reading in the House of Commons. To judge by the report of the Budget resolutions. the Chancellor of the Exchequer ill defend his interim Budget proposals by the need "to give ople time to look round." There is, of course, much force in the eller's suggestion that taxation is pressing very hardly at the ent time not only on the rich but on people of smaller means.
ere is far less force in his deduction therefrom that it is to give people time to look round. Substitute for the iraetion of civil enterprise has been purely haphazard would be an over-Statement; but it can hardly be said that the system of priorities and rationing of raw materials which has been the chief instrument used so far for this purpose, apart from the reduction of consumption expenditure by taxation, has achieved other than a very inadequate and imperfect adjustment between the optimum economy of consumption and the maximum war effort.
1|. For, like taxation, the system works negatively; it leaves to individual manufacturing establishments or trading organizations the responsibility of shutting down plant and releasing la-hour, and it is not to be expected that the individual manufacturer—left to himself and the higgling of the market will see eye to eye with the Government upon such a matter.
War-time Release of Labour Tu claiming that taxation is pressing hardly at the present time, the Chancellor is admitting unconsciously and reabsorption of labour war effort, To be just, this inadenot the fault of the present But it change with it a It was announced a few days ago, are now being adapted to provide 400,000 persons a year. The vidnerease is welcome.
But if the experience of the last War is anything to go by, even this be a small enough contribution the numbers that may be required.
1914-18 the transfer of man-power the Forces and into munitions, i&c., involved a contraction of 2,750,000
In any case, a reduction of output of non-essential goods, achieved by a diminution in the output of all firms producing such goods, is not the method best calculated to release the maximum, volume of labour for more useful production. It is likely to be much less effective than the concentration of output in the most efficient firms and the closing down of all other establishments.
The advantage of the second method may be striking if the results of an investigation into the case of the food, drink, and tobacco industry contributed by Mr. G. H. Daniel to the latest bulletin of the Institute of Statistics, Oxford, can be accepted and are anything like typical of the consumption trades as a whole. There Were 554,350 persons employed in this industry in July, 1939. A reduction of consumption by 30 per cent, would release 33,260 persons if the reduction was distributed over the output of all firms. By concentrating production in the most efficient units, Mr. Daniel reckons that no fewer than 202,340
Text read from the printed page and cleaned; old type leaves the occasional error.