Editorial: The Frozen Policies of the Labour and Tory Governments

It is the function of the Opposition to oppose the government and to try to magnify any small differences there may be. But a close examination of the actions of the present government and the Labour Government that it replaced last year will show not how great the differences are but how small.

The Labour Opposition now claims to be shocked at the idea of a policy of “wage restraint” at a time of rising prices. But under the Labour Government prices were rising in February, 1948, when Mr. Attlee and the late Sir Stafford Cripps presented their “wage restraint” policy in the White Paper “Statement on Personal Incomes, Costs and Prices.” The cost of living index had risen by 6% between June, 1947, and February, 1948, and went on rising up to 1951 when the Labour Government went out of office. The speech the present Chancellor of the Exchequer, Mr. Butler, made at Exeter on 12 July of this year (Observer, 13/7/52) could have been replaced by reading passages from the 1948 Statement; nobody would have noticed any difference.

On re-armament the Churchill Government is careful to point out that they are only trying to carry out the programme of their predecessors, as also on events in Korea.

On the taxation of profits a curious situation has arisen. In office the Labour Government tried to dissuade workers from making wage demands by pointing to the way in which it was taxing profits heavily and discouraging companies from paying higher dividends. Now that the Tory Government has gone a step further and introduced its Excess Profits Levy as “visible evidence of the Government’s intention to prevent excessive profits being made as a result of the re-armament programme” (Mr. Butler, at Exeter), the former Chancellor of the Exchequer, Mr. Gaitskell, has discovered as a reason for objecting to it an argument that might well have been used by the Tories if they were still in Opposition. His argument is that if the Government wants firms to concentrate on selling goods in America it should encourage them to do so by letting them make higher profits:—


  “After all, what we want is to induce firms and businessess to switch over to dollar exports as much as we can. We have to give them incentives to do that. By all means use the controls as much as possible but, as I think we all agree, those controls will be far more effectively used if monetary and incentive considerations are working with them.
“At this very time, the Government’s policy will discourage people from earning extra profits. The Excess Profits Levy will be a spoke in the wheel of that transition which I should have thought that we all thought was necessary.” (Hansard, 26/6/52, Col. 2468.)


On nationalisation there has been a curious reversal of attitudes since the Government changed. Towards the end of the Labour Government the demands of some Labour Party groups for more nationalisation as quickly as possible were met with a go-slow movement on the part of the Cabinet, in particular in the delay in carrying through steel nationalisation. Now it is the Tory back-benchers who are pressing for speedy denationalisation of steel and of road transport, and the Tory Cabinet that is trying to delay action. Having introduced its Bill to deal with the denationalisation of road transport, it suddenly announced that it would be deferred till next session.


  “This means that the Bill is unlikely to become law before March and that any sale of the assets of the Road Haulage Executive is not likely to begin until the late summer or early autumn next year.
“Conservative back-benchers are surprised.” (News Chronicle, 11/7/52.)


It is plain from the comments of the Press that whatever the merits from a capitalist standpoint of more or less nationalisation, the one thing business men as a whole do not desire is an endless process of reversal of policy by succeeding governments.