The economy
The four horsemen
Victor Montagu
Britain's international trading figures are very bad. The most recent figures show that our trade with the rest of the world this year. compared with last, has fallen very considerably, and the figures are only marginally worse in relation to Asia and the Pacific than they are in relation to Western Europe. One can see that joining the Common Market has not stimulated Britain's trade so far as Western Europe is concerned. Quite the reverse. In very few countries have we done any better. That is to say a good deal better in Bel-, glum and lower figures for Greece, Turkey, Poland, Nigeria, Israel and China. However, all these figures, when added up, are so low as to be negligible in relation to the total; a mere 4 per cent, What are called our invisible exports — banking, insurance, shipping, tourism — do not make up for this. They are calculated to rise annually by 10 per cent and no more. One can see at once how impossible it is to hold a 100 per cent worsening physical trade with a 10 per cent improved money inflow from these invisibles. The outlook remains very gloomy indeed.
In the middle of September Lord Rothschild, who is head Of Britain's 'Think Tank,' declared that by 1985 Britain would rate as Italy does now in the batting order of world powers. Lord Rothschild is a socialist. He comes from an international banking family and was a brave man in the war. He believes in war-time attitudes. He believes that the country can pull itself up by its own bootstraps as it did in the war. He thinks that the compulsive power of government should be used to establish greater social justice so that the wheels of production will turn more smoothly. At any rate he held to these ideas until very recently. This is the socialist in him, and liberal too, if you like. But now Lord Rothschild seems to be a disappointed man and if he is disappointed, I would agree with him. If we are falling behind in the rat-race of growth we cannot save ourselves by piling Hovertrains on Concordes and Maplins on Channel Tunnels. By Lord Rothschild's definition these are doomed to be too expensive and to fail in the very process of our becoming a backward Italy or whatever country may be chosen for com parison. Mr Heath is no more reassuring for all that he repudiates Lord Rothschild. I take alarm at Mr Heath's speeches because they are perpetually hortatory. They set Utopian standards of lick and spittle as would some regimental sergeant major. They urge perpetual growth as if it was a good thing in itself and as if, for example, the tallest and the stoutest people and countries were inevitably the best.
The truth is that most of our leading figures cannot get away from the war. Since Mr Attlee's Government entered on its disastrous course in 1945 everybody has assumed that if £14 million a day, which was the sum at that time, could be spent on the war it could also be spent on the peace. In depreciated pounds now that figure is £44 million a day. This is £16,000 million a year — rather more than what the Labour Government was spending at the beginning of Mr Wilson's second term not so long ago. The real leap forward — if you can call a U-turn a leap forward — has been made during the time of Mr Heath's administration. He is spending now twice that amount, that is to say 02,000 million a year, and it is Lord Rothschild and Mr Heath who have made the figure what it is, and in Lord Rothschild's present view, have dug Britain's grave with it. The recipe for Britain's failure has been written down and spoken out by its authors jointly, because one may be quite sure that Lord Rothschild is the 'think' and Mr Heath is the 'tank,' or vice versa.
Now what is the remedy?
First of all, what is growth? Production is certainly something which is promoted by man himself in all the three worlds, animal, vegetable and mineral. But not growth. Growth is uncontrollable and so is the reverse — abatement or degeneration. Growth is a secret of life which even the Bible scarcely comments upon. It is what Milton might have called "the ethereal and fifth essence, the breath of reason itself." Mr Gladstone, who read the Bible, never mentioned growth in his speeches. But Mr'Heath flays the citizens with growth and uses their money to establish his schemes for it. The process is comparable to gardener who sprays his plants with hormones and watches them sprout — and then die. Of course Britain is not dying, not yet. According to Lord Rothschild it is going cloWo the Italian peninsula, which is rather charming excursion if you like wine and heat. But I am not sure that imagery of this sort
or indeed any imagery — is wise in the mouths of statesmen and public servants. Leading men in an earlier epoch never spoke in Utopian or doomladen terms.
I became a Young Conservative forty-five years ago. I have seen two wars and two separate periods thereafter. For much of the first there was a grand recession in state control and interference, that is to gay there was a positive establishment of laissez-faire, a falling cost of living, and, I must admit, after 1929, severe unemployment. But on the whole people's private opportunities were opening UP in a way which they are not today. And that surely is what growth is. Not soaring economic statistics, not exponential graph curves, not brave,speeches by party leaders where the sky is the limit. But the still small voice that tells each one of us that life iS worthwhile, that it is fuller than it was before, that the future is, on the whole, hopeful, and that our children and grandchildren will respect us and emulate us for what we did.
To bring this situation back again the na' tion needs to take a deep breath and do something very positive. I would put four horsemen into the political skies, each of them with "15 per cent" emblazoned on his saddle cloth. One, a 15 per cent cut in government expenditure right across the front, especiallY on things which the private sector .can take up; that is to say education, health, much of welfare and most technological projects. TWO a 15 per cent surcharge on imported merchandise, exempting food and some raw materials. We snouia plum with the Common Market, as we have in the case of currencY alignment, that we be allowed to take this sort of maverick action. If Europe throws us out, well then the object of the anti-Common Marketeers is achieved. (But that is an article for another time.) Three, a 15 per cent cut in the money supply, that is to say in the note issue and in drawings on short call from the money market. The fourth and final horseman of the new apocalypse is a 15 per cent cut in bank balances on current account owned bY individuals, firms, companies, local authorities and the Government itself. (There would be no cut on savings which are on deposit or in investments.) This last action is not so revolutionary as K might appear. Memories are short. In Germany in June 1948 the United States of America and ourselves sealed the doors of the banks over a weekend and wrote everybody's accounts down, not by 15 per cent, but by 90 per cent. Shortly after that we discovered a man called Erhard, made him Germany's Economics Minisrer and the present German economic miracle is the result.
With these four horsemen riding the skies, the thunder cicruds which menace Britain can be swept away. The chief of these is the fury of the trade unions. Under these proposals there could be an immediate restoration of collective bargaining, and immediate repeal of the Industrial Relations Act and an immediate abandonment of the pay and prices code and of dividend limitation. Inflation would fly out of the windoW. Most of the threatening powers of government and local government, including burdensome taxation, would be greatly reduced. Pollution and despoliation would begin to disappear and things that weigh on life, like excessive industrialism, social turmoil and congestion would also ease. Most vital of all
— the sense of loss of control over resources for the maintenance of family life would be hfted There are no political panaceas which last a Whole lifetime. But at least we have the right In each generation to make an attempt, as the poet Shelley so well put it, "to outsoar the shadows of our night."
Victor Montagu, formerly Conservative MP for South Dorset, disclaimed the family title as 10th Earl of Sandwich in 1964. He is chairman of the Trident Group.
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