The Cabinet's First Duty
TILE personnel of the new Cabinet, which has not been announced as these words are being written, is a matter of obvious importance, but of much less importance than the spirit in which the new Cabinet approaches its tasks. It must be a spirit of unity, of courage and of resolve. Of unity it is early days to speak. We have been assured already that measures against dumping are to be taken immediately, and that a systematic tariff will thereafter be framed as soon'as the necessary study has been given to the problem. There will manifestly have to be careful going in the Cabinet room if accord in the handling of those questions is to be preserved. But preserved it perfectly well can be, provided Mr. Baldwin is resolute, as we believe he will be, in voicing the views of the moderates in his party—which happen to be his own views—and disregarding the hotheads of the Right. Measures of a certain type against dumping need arouse no a priori protests from Free Traders—certainly not in the present Circumstance's, when it is recognized that there must be give and take on both sides. But the measures must be directed to that single end alone, and not used as a calculated first step towards the introduction of a general tariff. And there must be sufficient reason to believe that they will achieve their purpose. The first thing to do about dumping is to define it. If it is under- stood to mean the deliberate sale of goods in this country at prices below those ruling in the country of origin, then there can be no serious complaint if a Cabinet representing what the present Cabinet represents attempts to meet by temporary 'restrictions threats, in many cases temporary and deriving from special causes, to British industrial equilibrium.
The question of dumping in that aspect (it need hardly be observed that this does not meet the special case of goods from Russia, where there is no ruling internal price in the ordinary sense) can be considered on its merits. The question of Protection generally cannot be so much as discussed without raising in their most challenging form those international issues which, beyond any likely to arise at home, will put to the proof the vision, the courage and the realism of Mr. MacDonald's new adminis- tration. Half the prophets of Protection are speaking still in the language of 1903. We are living to-day in a world such as Mr. Joseph Chamberlain never conceived of. We are living in a world such as no one but a few far sighted students of events conceived of as little as five years ago. We are living moreover in a world so near to a complete financial crash that unconsidered measures taken by any single State of importance may easily bring a dozen other States to ruin. All over the Continent of Europe governments are being urged, as the League of Nations Financial Committee has just been urging Hungary, to increase exports and restrict imports. And everywhere the State endeavouring to increase its exports collides violently with the barriers erected by a State resolved to restrict its imports. The end of that process is collective suicide.
But what is the alternative to it ? Germany, to take the outstanding case, has to export at any cost. It is only through the trade balance so achieved that she can hope to pay foreign creditors a pfennig. As it is she has no hope of paying off the frozen credits extended under the " standstill agreements till next February, and far less of resuming any sort of reparation payment (except per- haps in kind) when the Hoover moratorium expires in July. It has been revealed this week, moreover, that Germany's commercial debts are greater by over twenty per cent, than the figure at which the Basle Committee estimated them. That is the situation the world has to face, and the French Prime Minister is said to have come back from Washington determined to face it. His desire is to emphasize France's leadership in Europe. As to that no one will grudge France her primacy if she really aspires to lead the world by straight paths out of the quicksands of impending bankruptcy back to financial stability and restored confidence. Financial power is in France's hands, and it is for her statesmen to decide how they will use it. But participation in the negotiations that must soon open in this field will throw on the British Cabinet responsibili- ties such as none of its predecessors since the War has had to bear. In 1929 the Young Plan was approved at the Hague. Mr. Snowden fought for Great Britain's rights there and found his praises sung in strange quarters. Far greater problems are before the world now. The Young Plan itself has broken down—after a bare year of opera- tion—and the first decision is whether it shall be remodelled or discarded. Debts were not discussed in 1929. It is inconceivable that they should be excluded to-day. M. Laval, indeed, in his singularly guarded disclosures as to what passed between him and Mr. Hoover, has hinted clearly enough that revised arrangements regarding debts " during the present emergency " are in contem- plation. That is enough. It will be singularly difficult to begin discussing debts now and leave off half way.
It is with those world problems that the new Cabinet has to grapple, knowing that they are problems whose solution may mean life or death to this country. How ill- considered in that connexion is the suggestion that haS found strange favour in some quarters that the Cabinet should detach one or two Ministers as a kind of " flying- squad " to look after international conferences which departmental Ministers are too occupied to attend. There is not a problem in the domestic field comparable for a single instant in importance with the tasks awaiting the Cabinet on the world stage. To ignore them would be fatal. They would be settled then without our co-opera- tion and to our detriment. To the Prime Minister, the Chancellor of the Exchequer, the Foreign Minister, the President of the Board of Trade, whoever the holders of these latter offices may be, the one imperative and dominating call should be to collaboration with the Ministers of other Governments in establishing conditions in which British trade will once more find markets where countries with restored purchasing power can buy British goods as they were buying them twenty years ago. No one need envy the Cabinet that task. It will need de- sperate efforts merely to ward off further disaster. After that comes the long toil of regaining firm ground. And with that in prospect we are invited to begin by disor- ganizing the creaking machinery of European commerce and finance further, and perhaps finally, by interposing another protective tariff between producer and purchaser. If the Cabinet has any sense of what the international situation demands, if it has not discarded in advance all hope of creating better conditions in the world through new international agreements concerted before the last chance has gone, then it must recognize that Protection to-day and Protection to-morrow are utterly different things. The immediate task cannot be evaded. And the immediate task is not the creation of a protective system. Protection now would only make complication disas- trously more complex. To put first things first does not mean postponing second things for ever. It means leav- ing their consideration, certainly leaving any decision on them, till they can be considered in the light of the new conditions the Cabinet should be striving to create.
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