Evening star., 1934-11-05
BY LOUIS NJ. LYONS.

series OF SIR articles OutttntnQ Eng
lands efforts to reform the British
economic system.
BY LOUIS NJ. LYONS.
England's recovery, nursed by her
national government as its chief
| chore, has been steady over the last
| two years. If it still has a long way
| to go, it has nevertheless taken a big
lift from the doldrums of 1882. Un-
employment is still greater than in
1929, but much less than two wears
| ago. British imports and exports have
both shown improvement for the first
half OF this year. Particularly has
England had better fortune than
America in getting her hs~y indus
tries back to work She is experience
ing right now building boom. stimu-
lated by the cutting of interest rates.
She is militantly pushing her shipping
industry back into the front OF the
| world carrying trade by financing
shipping mergers and paying for the
construction of the largest ship in the
world
Better business has not Just hap
per.ed along in Britain. To get it has
been the central effort of her govern
ment since the crisis that split the
labor ministry Of Ramsay Macdonald.
Nothing has been too small for the
paternal oversight of a government
that thinks in terms of boosting Brit
ish trade Our striking fishermen
would be interested in the agreement
announced by a British minister in
Parliament this Summer for aiding
the herring industry. Funds will be
provided up to limit of S250,000 for
,, loans at per cent, repayable in three
years, for the purchase Of nets. and
,, in addition the government will under
take to meet any amount by which
the boats share Of the net earnings
at the end of the season falls short
Of the actual expenditure on fitting
out" Three per cent is better rate
| than our r. F. c. gives a borrowing
industry.
Rate Cut Aids Recovery.
Experts appraise the root cause Of
England's recovery to the drastic low
ering of interest rates. Walter Runci-
man, president Of the British Board
Of Trade. claims that the single finan-
cial stroke of converting the British
war debt bonds from per cent issues
to 81 per cent has saved the govern
ment 100000 900 in annual interest
charges. 1t goes a long way to &C
count for the comfortable surplus
! with which the British treasury fin
ished the year. and for the good news
of 10 per cent cut in income taxes
that came to the British taxpayer this
Summer
Instead Of a 25 per cent income tax.
the British salaried man now pays
only 2212 per cent (412 shillings to
the pound. Instead of paying a tax
of SIS per horsepower on his automo-
bile. he now pays only $375 horse
power Government employees have
had half their 1881 cut restored and
unemployment benefits have been put
back to where they were before Philip
Sncwdens heroic budget slashing Of
three years ago.
These lightenings Of the tax load
have given a lift to the spirit of
British business. They leave $4,000
900 a year more for private spending
than there was under last years
budget Britain's home market has
responded by showing4a capacity 10
absorb a IA per cent increase in pro-
duction this year.
Free Trade Abandoned.
,, To aid her industries. England has
thrown overheard her ancient tradi-
ton of free trade. She now applies
stringent quotas upon imports, going
so far as to cut Japanese textile ship
mentS by 81 per cent, to prevent
dumping of goods that were threaten
ing British wages. BY trade pacts she
has seen to it that when Danish bacon
comes to Britain it is wrapped in
| British twine. When Poland sells
lumber in England she agrees to buy
British steel and automobiles. She
has arranged it so that her own do
minions have benefited most by the
/ recent increases in her raw material
! imports
! Redundancy" Is word that
| Britain has coined to describe surplus
I plant and equipment. The govern
ment has encouraged industrial re-
organization, mergers. and pools to
reduce redundancy" by the scrapping
of the least efficient of her industrial
plants.
Most striking illustration OF the
British governments policy of stand
ing generously back of British indus
try has been the tremendous urge she
has put behind her effort to- help
British shipping back TO its premier
position in world commerce. Her
shipping used to be half the worlds
tonnage. 1t has fallen to just over
a quarter. BY recognizing her great
shipping lines and eliminating the
less efficient shipyards. England by
mid1e34 was again building half of
all the shipping under construction in
the world.
Probably it is impossible to exagger-
ate the effect of a lowered interest
rate on Britain's business improve
ment. Money is now cheaper than
for two generations in England, ac-
cording to the president of the Board
of Trade. Unemployment in the
building trades has been reduced by
40 per cent in less than two years.
The reduced cost of capital has
brought home building within the
reach of low-income families. Around
London, whole new Subdivisions of
homes have been built by private in
dustry to sell for less than $4,000
on terms of Sl00 down and SIS a week.
All these aids to business and en-
ployment cost public money. England
has not hesitated to tax her wav
through. There a $4,000 income is
taxed at as high a rate as a $4,000
income here. British income taxes
reach right down to the man earning
$40 a week. A single man with $2,500
pays the exchequer 10 times as much
as under our Federal income tax A
married man with two children,
earning 81 500 pavs 1914 in England