NOW ON VERGE OF BANKRUPTCY

Chronicle (Levin), 29 September 1949, Page 5

NOW ON VERGE OF BANKRUPTCY

(NJZ.P.A.-

-Reuter.

Churchill Bitterly Attacks Government . For Lavish Spending . i

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! • Received Thursday, 9.15 a.m. ; LONDON, Sept. 28. "We are now brought to ihe verge of national an& international bankruptcy," said the Leader of the Opposition, Mr. Churchill* in moving the Conservative amendment to the Government's confidence motion in the House of Cojnmons debate on devaluation today. He said that the Socialist Government had exacted more than £1,600,000,000 from the pehple and spent it in the past four years, used up ev§ry national, asset it could lay its hands on and taken 40 per cent of the national income for governmental administration.

Mr. Churchill dropped election hints to the Government when he said: "Most of us agree that it is high time for another Parliament and that all our difficulties will have a better. chance of being solved in a new House of Commons." The stock exchange today reflected hostility to yesterday's announcement by the Chancellor of the'Exchequer, Sir Stafford ^ripps, that the profits tax would" be increased by 20 per cent. As soon as the markets opened dealers marked down the prices for all shares irrespective of the nature of the business. Mr. Churchill resumed the debate before a crowded House. Moving the official Opposition amendment, he said: "We have reached a point in our postwar story and fortunes which is both seri'ous and strange. There lies before us a general election and overall there looms and broods the atomic bomb." The Opposition's amendment "welcomes the measures agreed upon in Washington, but regrets that the Government, as a result of four years' mismanagement, should now be brought to drastic devaluation of the pound sterling, contray to all . the assurances given by the t Chancellor of the Exchequer. The return of national prosperity, the maintenance of full employment, and the safeguarding of social services can never be as^ured under the present Administration which, instead of proposing fundamental cures for- our economic ills, resorts to one temporary expedient after another." Mr. Churchill said he could not believe that American manufacturers would immediately reduee their highly protective tariffs. "True exchange value between the pound and dollar is one whereat we ought to aim. If in the present circumstances the Chancellor felt it necessary to devalue the pound *to a fixed figure, I think it was right to go the whole hog. Decision Taken Too Late. "I am all for a free market. I should have been more inclined to set the pound free under regular and necessary safeguards and controls, and acoept the results rather , than adopt the present rigid method of pegging exchange at the very lowest rate anyone could possibly conceive." Mr. Churchill said the Chancellors' admission of "resorting to one temporary expedielit alter another" largely explaiiied the nations continued drift down hill. A drastic alteration of the exchange rate should not have been left until the crisis broke. The Chancellor should have taken the decision in goo-d time before Britain's gold reserves drained away. Recalling Sir Stafford's denials on devaluation, Mr. Churchill said:

"It will be impossible in the future for anyone to believe in the statements he may make as Chancellor." He attacked Sir Stafford for "prejudice against profit earners," demanding to know how could the country live without profit earners. Socialism was in principle contrary to human nature and could only be enforced ii\ its entirety in the wholesale f&shjon of Communism. Mr. Churchill ended his 75minute speech saying: It is my duty to warn the country in good time of the dangers, but I thank God that in my old age I preserve the ihvincible faith that we shall overcome them." The President of the Board of Trade, Mr. Harold Wilson, described Mr. Churchill, as making a "frankly electioneering speech. We 1 have no room in our present situ- I ation* for restrictive controls operated by private industry and trade I associations. With the new exchange rate, if manufacturers . set out to produce the goods j American consumers want, I am I certain we can treble the rate of export of consumer goo'ds to America and increase tenfold. the rate of export of capital goods to Canada."