How do we evaluate Mr. Wilson's stop-gap measures*to meet the balance of payments crisis? The first thing that needs to be said is that Monday's measures do not represent a policy in themselves; they need to be judged in the context of the general line of march. The vital questions, including that of what measures are to be taken to shoct down funk money as it begins its inevitable flight to safe climes; and that of what steps will be taken to reduce overseas commitments, such as the scandalous wers in Malaysia and Arabia, will not be answered until the Queen's speech is delivered: and if the answers are too timid, or wrong, the movement will find ways to make its desires felt, Every?thins depends on whether Labour is to make use of its opportunities to enact all of its programme, and then push forward from that base into profoundly popular le,;rislation which can ensure a steamroller majority within two years; or whether we are to have a caretaker regime which will take care of the mess until the Tories come back to reclaim it for their own, If they see the beginnings of a new society taking shape, the workers will gladly tolerate any restrictions which seem essential. But if they see the roundabout teetering on, back round to where we just came from, then they will do the other thing,
Monday's measures were fairly warmly received by the business press. Mr. Maudling even claimed they were his own, which reveals if true, that he was possessed of a most chaste modesty throughout the whole of the past six weeks, during which time he declined to recognise even the crisis, let alone his solution for it. The Economist, advocated Mr. Wilson's measures in detail three days before they were announced. But the advocacy of The Economist did not stop at import surcharges. It went on to put very clear recommendations for the next onslaught, and the one which is fraught with most dangers for Labour, the one of incomes policy.
When they met the government spokesmen, the employers said "..their attitude to the whole field of prices and prefits had not changed since earlier this year, when a special report by the F.B.I. came to the conclusion that no workable methods could be devised for exercisin;: discipline on prices and profits." (Financial Times Oct. 27, our emphasis). Hastening to their rescue, The Economist had already advanced the notion that a tax on excess dividends (the so-called "unearned incomes equalisation tax") would excetly fill the bill. This red light must be very clearly marked by the unions. That The Economist's advice has been followed up to now is not perhaps surprising: but if the Government accepts this particular line it will suffer a setback which could easily prove fatal. The unions cannot afford to even negotiate on such a basis. It would leave the employers in complete control of the situation; and a little bookkeeping manipulation would enable them to dodge the worst effects of the tax. Profits reinvested in the holdings of the profiteers ere still very much profits = and the fact that "income" has been turned into"capital’ in this process is no comfort at all.
Yet the danger remains that in their loyalty to "their" Government big sections of the working class and the trade unions will accept such a proposal. It will appear to be advocating "restraint" and"saczifices" on both sides. The left must find a way of opposing the incomes policy with slogans which will appear reasonable to these sections of the workers. With due humility we would again put forward our particular slogan: "No negotiations on an incomes policy until the books are open to the workers", * The Financial Ting estimates that under the export incentive scheme Ford Motor might get an £2$ milliSA p¥ofit!! We shall publish a study of this next week.