Evening star., 1949-08-29
Increased Imp 5 by U.S. Held
Chief Dollar Source for Britain
fSecond of a series.J

Chief Dollar So
Second of seriesJ
By William n. Stonemon
Foreign Correspondent Of The Star and
| Chicago Daily News
LONDON. Aug. 29.-Britain is
like a man with the hiccups.
Everybody has a cure for the
economic cramps in which this
country and the sterling area find
themselves as their dollar deficit
mounts at the rate of $2,500.000,-
900 a year and their gold and
reserves head rapidly toward zero.
Some particularly drastic reme-
dies will be suggested by the
Americans during the financial
talks that begin in Washington
September 7.
Some of them were suggested
by Paul G. Hoffman at the end
of his recent European tour as
head of the Economic Co-opera-
ton Administration.
His principal suggestion was
that the United Kingdom should
treble its exports to the United
States, raising them from $780,
900 900.
Certainly the cure will be a
multiple one. and the one thing
certain about it when it finally
comes to be applied is that it will
be a lot tougher than the disease.
Generally speaking. it is going
to consist of strict economy on
the home front and lot of very
hard work, all based on a general
realization that. economically
.speakiug.- Britain is living in a
time of crisis just as serious and
just as demanding as the evil
days of 1910.
Labor Party Responsible.
This realization does not now
exist despite the outspoken hon.
>esty of Sir Stafford Cripps, Cham
cellor of the Exchequer, on the
government side and of Anthony
Eden on the Conservative side.
The labor party must accept
very heavy share Of responsibility
for miffing the population into
the belief that all is well.
The nonsense which 1t has been
peddling to the people will come
home to roost when they are
forced to apply the brakes to gov
ernment expenditure in the COM
paratively near future.
Laborite attempts to blame
their distress on Wall Street will
not fool many people in country
which, though broke, has not COM
pletely lost its sense of humor.
The cures which will have to be
employed to correct Britain's dol
lar situation will have to include
measures both here and in the
United States.
Everybody with whom we have
discussed the situation here in
London seem to agree that nation
alization of such things as coal
mining and transport hasn't had
anything to do with the current
crisis.
They all agree that nationaliza-
ton of coal mining has probably
prevented an extremely serious
situation in that important field.
Thus, to begin with, it must be
taken for granted that no attempt
will be made by the Americans or
anybody else to undo Socialism,
as such, in the United Kingdom.
Problem Is to Earn Dollars.
The main problem is to make it
possible for the United Kingdom
to earn more dollars. 1t can do
this In two ways: =
BY selling more goods and serv-
ices to the United States and
other dollar countries directly. or
BY selling more goods and serv-
ices to other countries which, in
turn, can earn dollars by selling
more goods and services to the
dollar belt.
In either case Britain must have
something interesting to sell and
must be given a chance to sell it,
Boiled down to practical meas
ures this means that the United
Kingdom must sell first-class
goods at reasonable prices in large
volume.
It also means that the United
States, first of all, must be pre-
pared to buy a maximum amount
of goods either from the United
Kingdom and the colonies, or
from other countries which will,
in turn. buy from Britain.
With all respect to Mr.. Hof-
man-who is obviously intelligent,
energetic and deeply dedicated to
the job Of restoring Europe-his
suggestion that British exports to
the United States should be
trebled-seems to verge on the
fantastic.
u. S. Takes 4 Pct. of Exports.
At present only per cent of
the United Kingdoms exports go
to the United States and only n
per cent go to the United States
and Canada together. Even in
1948 only 6 per cent went to the
United States.
Total exports from the United
Kingdom to the whole dollar area
during the first half of this year
came to only $352,000. 900 COM
pared to imports Of $828, ,000, 900.
The United Kingdom, before
the war, had a dollar deficit of
up to $500, 900 900 q year, which