Evening star. [volume] (Washington, D.C.) 1854-1972, 1951-05-27
|DoIIurGup
Danger Minor
In Europe
By Suson Strange

of having explained to us-is {
thing of the past. It is rapid.
being succeeded by more menacins
economic dangers, chiefly imitation
and all the social destruction i
brings with it. So far Europe
Britain and the United States art
all less prepared to meet and de-
feat these new dangers than they
were in 1916 to overcome the dol.
lar gap.
This is the underlying conclu-
sion of the Economic Survey Of
Europe for 1885," which has just
been published. The survey is ar
impartial affair written by team
of United Nations experts of the
Economic Commission for Europe
working in Geneva. which has q
high reputation for fearless ano
careful analysis of unpleasant eco.
nomic facts. The experts have not
been afraid in the past to warn
Europe of what may happen il
either European governments OF
the American Government do not
adopt more far-sighted policies
The warning they give now is
therefore all the more worth
listening to.
The two most immediate dangers
the survey describes are ones we
are already aware of: The rise
of prices and the shortage of raw
materials. Unfortunately, each is
likely to act on the other. making
it worse. For instance, one of the
few steps that might be taken to
lessen the shortage of raw mate
rails would be to raise prices oil
some of them in order to persuade
producers to put more on the mar
ket and thus, in the end. bring
down whole series of prices.
Price-Juggling Idea
The survey suggests, for exam
pie. that a higher price for British
coal exports or for electricity
would help to choke off unessen-
tial demands, and that a better
price for steel scrap (the big bot
tleneck at the moment for steel
foundries) would bring more scrap
forward. This would make pos
sible a higher level of steel output
which. in turn, would reduce the
pressure Of rearmament on other
prices.
But these would only be pallia-
tive remedies. The surveys only
cure for high prices is interna-
tional ALLEGATION of scarce raw
materials. This. they realistically
point out, is impracticable unless
the industrial consumers in Eu-
rope and North America are pre-
pared to offer the producers some
thing in return. Otherwise, as has
already been shown over wool
rubber and a number. of other
commodities, the producers refuse
to cooperate. The only thing
that might induce them to change
their minds is a firm guarantee
(a) that there will be a long term
market at reasonable prices for
their raw materials, and (b) that
in return for their raw materials,
they could be sure of steady sup
plies of manufactured goods, ma
chimes and industrial equipment.
The third big danger of which
the survey warns Europe is the
danger of lost opportunity to
combat communism effectively by
creating better living standards
for the peoples of underdeveloped
countries. The survey itself does
not put it quite like that, but that
is what 1t adds up to. At the mo-
ment, high prices for primary
products like rubber and tin are
giving a golden opportunity for
the underdeveloped countries to
get something in return for their
products. The terms of trade have
been against them for a long time
and the industrial countries have
had the best of the bargain. Now
the Korean war has launched re-
armament programs a little more
suddenly than they might other
wise have been launched. Re-
armament, in turn, has revealed a
little earlier than would otherwise
have been apparent that industry
has been running ahead of sup
plies of raw materials.
Future Shortage Figures
Beneath the present scarcity OF
raw materials there is a long
term shortage which figures in
the survey reveals very clearly
Now, then, is the time for the pri-
mary producers to use the chance
to invest capital and to push for
ward the balanced economic de-
velopments of their countries.
The danger of this situation is
that they will not be able to do so:
that rearmament will swallow UP
supplies of steel-made machines
and all the other "developmental
goods" For the underdevelopec
countries as whole" says the
survey, cit seems likely that just
at a time when they have the
financial resources of their own
available they will not be able to
spend them on those goods which
in the long run, they need most
for their welfare" Instead, they
will be tempted to fritter Their
profits away in local imitation OF
on the wrong kind of investments
The developed countries in
Europe and North America there
lore have a new responsibility
To see that instead of setting
aside less for export, they set aside
more for these undeveloped coun-
tries. On Britain there is par
Iticular responsibility to allow the
overseas parts of the sterling area
to spend, if necessary in dollars
the large balances which they be.
gan to accumulate last year ir
III 0T10Op 0thnruico tho e,,rx,o,