Seldom has the essentially farcical nature of the great incomes
policy debate been better exemplified than by the recent episode of Mr Wilson's latest—and reverentially well- publicised—jeu d'esprit, the so-called 'national dividend.' Born on Friday, killed by Mr George Woodcock on Saturday and buried on Sunday, its ephemeral existence makes even the life-cycle of the late Mr Solomon Grundy seem in retrospect a miracle of longevity.
Nevertheless, since there are still a num- ber of grown men who persist in taking the debate seriously, and believe that there is something 'new'—they are not quite sure what—happening, it is time to take a long, hard look at this extraordinarily resilient myth. There has, for the past seven and a half months, been in force the most thorough- going system of statutory control of in- comes. It has worked, in the sense that wages over that period have risen very little. This has been achieved only minimally because of the existence of restraining legislation. What has mattered far more is that, for the greater part of the period, the policy was one of total freeze—the easiest of all concepts to grasp—and that this was widely accepted as a strictly temporary measure at a time of 'national emergency.' There is nothing new or remarkable in this: Sir Stafford Cripps did much the same nearly two decades ago, without legislative backing. Nor is it remarkable that another result of the experience has been to drive even the most solidly loyalist of trade union leaders into a position of total opposition to any attempt by the Government to con- tinue statutory control of incomes after its present powers lapse this summer. Instead. the unions want to see a voluntary incomes policy, operated by themselves. But a volun- tary policy is what even the unrivalled bully- ing abilities and emotionalism of Mr Brown failed to achieve. There are some in White- hall who believe he was defeated by the particularly acute pressure of demand for labour, and that a voluntary system could still succeed if only more men were out of work. But as the National Institute point out in their latest review, 'we have serious doubts whether, even with a higher level of unemployment, a voluntary incomes policy of the kind being operated before the freeze would be sufficient to earn any sig- nificant leeway on the balance of payments.'
So, in short, it is compulsion or nothing. Talk of a voluntary system with reserve powers of compulsion to deal with the occa- sional maverick is either ignorant or dis- honest. For the growing disenchantment among trade union leaders with the idea of a policy containing any element of compul- sion shows clearly enough that statutory controls, if perpetuated, would have to be invoked on a steadily increasing scale. Pres- sures from the shop floor, alone, would make sure of this. There is only one other country outside the Communist bloc that has at- tempted a statutory incomes policy : Holland. Even among the law-abiding Dutch the pressures and internal contradictions have proved such that the policy has totally col- lapsed. with wages rising last year by more than 10 per cent. individual subject to statutory government control, then it would be embarking on a suppression of individual liberty as intoler- able as the administrative task would be impossible. But, of course, it is thinking a nothing of the sort. Mr Wilson likes to threaten a further increase in unemployment as the alternative; but everyone knows that this is as empty a piece of bluster as his threat to the Labour rebels of a general elec- tion. Apart from Mr Crossman, who is in the doghouse, and those two nebulous and quasi-metaphysical entities the DEA and the CHI, who are capable of believing in any- thing. it is difficult to discover who really does take the incomes policy debate seriously.
Certainly the Prime Minister does not. He has made it clear that all he is concerned to do is to wind the incomes policy up altogether. 'The issue,' he said last week, 'is . . . to ensure that our existing controls are dismantled not in an orgy of decontrol, but in an orderly manner . . . But the future of free collective bargaining is not in doubt.' Nor is it surprising that having, on 20 July 1966, in an orgy of control, built up the wage pressure behind the' dam, he should now wish to release the pressure as gradually as possible. But this is the begin- ning and the end of it. There is nothing more to it than that. explanation : that the Prime Minister is des- perately concerned that no one should dis- cover that his real economic policy is simply that commonly associated with the name of Mr Selwyn Lloyd. The more Mr Wilson's opponents—both within and outside his own party—concentrate on the spurious incomes policy debate, so beloved of the press, the more they are playing into his hands. And, what is more serious, the more they are avoiding the real economic issues that this country has to face.
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