Evening star., 1931-04-05
BY HAROLD e. SCARBOROUGH.


Y ONDON-Ten lean years have
been Britain'S lot. OF these, the
last has been definitely the lean
IL est; the number of unemployed
has mounted week by week. until
1t has now reached 100000 Foreign
trade has diminished month by month.
Practically all industries show declines
in production, and such great staple
industries as shipbuilding. mining. the
iron and steel trades and the textile
business have done worse than the
newer luxury" industries, which have
tended to center about London instead
Of remaining in the Midlands or North.
Yet, despite the deterioration of the
country'S economic position In 1880,
something like a psychological i'm
provement can be discerned Heads of
business still view with alarm in
their annual statements, but privately
they are beginning to wonder whether
the bottom of the slump has not been
reached and whether when the up
wing comes Britain will not get her
''Ill share of it.
Perhaps some part of this near
optimism is founded on the fact that
at long last Britain seems to be no
worse off than some other countries,
and definitely better off than some
which only a short time ago were her
most formidable competitors. Since
1920 some years have been worse than
others for British business. but none
has been good. Through this long de-
pression-until 1929-Britain appeared
to have been isolated. The United
States in particular seemed to the Brit
ish to be making huge success
through flouting almost every cher
ished principle of orthodox economics.
While other great industrial nations
were rapidly expanding their production
and their trade Britain drifted toward
backwater Sometimes such Incl
dents as the general strike of 1926
| accelerated the process.
Wholesale Prices at Pre-War Level.
In the last year Britain at least was
able to find company in misfortune.
And, as a matter of fact, # actual de-
grees OF depression are to Re measured,
Britain has perhaps not done so badly
as she might have International coma
parisonS of statistics are VIGOROUSLY
unreliable, but, broadly SpeaL ing, 1t may
be questioned whether unemployment
in Britain is so severe as in Germany
or the United States. 1t Is true that
production in Britain did not have so
far 20 fall, but its rate of decline has
seemed to be less steep.
Moreover, the British have recently
! found some cause for complacency. and
! even for self-congratulation, on their
| banking system, which may be criti-
cized as being too conservative, but
| which at least has shown comforting
stability. an old fashioned virtue but a
very useful one in times Of stress.
In support of the views Of those who
| believe that an industrial recovery may
| set in in England before 1t does so uni
versally, it is pointed out that this Is
still the most completely industrialized
nation in the world. The fall in whole
| sale prices, which has been the most
striking feature of the slump, has been
most marked in foodStuffs and in raw
materials. OF these Britain is, directly
q comparatively small producer but a
| very large consumer. With practically
no tariffs to serve as check, British
manufacturers find themselves able tC
secure supplies on more advantageous
| terms than some of their foreign rivals
Wholesale commodity prices in this
country today are actually fractionally
below the pre-war level. according tc
the index number revised weekly by
the Financial Times. The American
index. however, Is still IA per cent anc
the German 10 per cent above pre-war
In this respect. at any rate. British
industry occupies a relatively favorable
| position.
Water Out Of British Stocks.
| Another factor which may tend tC
| hasten recovery is the extent to which
industry here has already been Debated
| During 10 years of depression capital
| has been written down drastically II
many industries which were burdened
with charges on capital no longer rep
resented by assets. Much deadwooo
| still needs to be removed, but, speaking
broadly, 1.-The water has been squeezed
out and profit margins can be corre-
| spondingly reduced.
The outlook for British industry,
| therefore. is not without bright spots.
| This does not mean, however, that all
! is we'll No question now Is more fre-
quently raised nor more earnestly de-
| bated them What is wrong with Brit
| ish inoustry?" Among the general run
| of business men the most frequent
answer Is, TOO little protection against
| foreign competition and too much tax
ation.''
This stresses the need for action by
| the government rather than by indus
| try itself The more acute analysis
provided by the economists suggests
| that the problem has deeper roots and
cannot be solved by shortcut methods
1t has been frequently pointed out that
the British industrial system is too rigid
The country was the first to become
induStrialized and for long was without
rivals. The result of this prinacy was
that industry became set in mold
and found it hard to recognize and to
adapt itself to changing conditions
Example after example could be quoted
to show how the rigidity Of industry
handicaps 1t in the present struggle Tor
markets. Every consular report pub
lished gives instances of trade lost by
oldfsshioned selling methods, by in