STATE EXPENDITURE

Wairarapa Times-Age, 28 June 1941, Page 7

STATE EXPENDITURE

TREMENDOUS INCREASE TO MEET WAR COSTS. One of the first leading articles I. wrote when, a very young man. I became editor of the “Eastern Morning News," at Hull writes Mr J. A. Spender. in the “Yorkshire Observer,’’ was about the sudden resignation of the Prime Minister’s father. Lord Randolph Churchill, then Chancellor of the Exchequer, in December, 1886. Why did he take the stop which so disastrously ended his career? It was to protest against the rise of the national expenditure to just over £9O 000.000 a year. What would he have said if he had known that his son would be Prime Minister of a Government which had to budget for an expenditure of £3,844.000,000, and proposed to raise £250,000,000 by increased taxation in one year? Between the two figures we get the measure of the combined effects of ’war and social policy upon the finances of the country, and at the same time of its extraordinary and. in those days, altogether unexpected ability to meet the new demands. In 1880 a ninety-million Budget was the legitimate target of economists in all camps, and not least of Liberals preaching retrenchment and reform. If I remember rightly. I joined with those in praising Lord Randolph and endorsing his gloomy prediction that if this went on the hundred millions would be reached by the end of the century. In these years the hundred-million Budget and the shilling income tax were marked together in the public mind as the final stages on the road to ruin. The point which concerns us now is that the Cancellor of the Exchequer is as confident of the capacity of the country to meet the present expenditure of £3,884,000000 as -his predecessor in 1886 was doubtful of its capacity to meet an expenditure of £90,000.000.