The Commonwealth and Britain's Economic Recovery

MR. JOYCE: This is a joint meeting of our two great Clubs to hear an address by Great Britain's Secretary of State for Commonwealth Relations--The Right Honourable The Viscount Swinton, P.C., G.B.E., C.H., M.C. Lord Swinton, who has been a prominent figure in British politics since 1920 is also the Deputy Leader of the House of Lords, a post he has held since 1951. .

Born in Yorkshire 70 years ago, Philip Lloyd-Graemebetter known as Sir Philip Cunliffe-Lister, a name he assumed later-was educated at Winchester and at University College, Oxford. He was called to the Bar in 1908 and decided to specialize in Mining Law.

However, he joined the Army in 1914 and served in France, winning the M.C. and rising to the rank of Major. Invalided home, he was appointed Joint Secretary to the Ministry of Labour in 1917. This led to his leaving the Bar for politics, so the next year he was elected to Parliament as Conservative Member for Hendon, a seat he held until his elevation to the Peerage in 1935.

In 1920 he was knighted and also received his first appointment at the Board of Trade as Parliamentary Secretary. A year later he became Secretary of the Department of Overseas Trade and in 1922 reached full Ministrial Rank with his appointment as President of the Board of Trade, an office he held for three periods . . . 1922-23, 1924-29 and in 1931.

As President of the Board of Trade he presided over the Imperial Economic Conference in 1923 and the International Conference of Maritime Nations in 1928, which adopted a Convention which did much to improve conditions for safety at sea. He was also responsible for legislation to reorganize the British film industry.

Sir Philip's next appointment was that of Secretary of State for the Colonies, a post he held from 1931 to 1935. He established the Economic Section at the Colonial Office and instituted an economic survey of the Colonies which was used at the Ottawa Conference in 1932.

As Colonial Secretary he displayed the air-mindedness which was to distinguish him later. He also made annual tours in the Colonies, in order to gain first-hand knowledge of their problems.

In 1935 he was raised to the Peerage, taking the title of Viscount Swinton, from his Yorkshire home. From 1935 to 1938 he was Secretary of State for Air. Alive to the dangers of the European situation, he worked tirelessly for a strong Air Force and was responsible for setting up the famous "Tizard Committee" under which radar was developed. Within a short time he had trebled the numbers of the Air Force personnel. In the requirement of the Air Force he chose the difficult task of developing new types . . . among them the Spitfire and Hurricane which won the Battle of Britain. To speed up production he cut out the prototype stage, ordering "straight off the drawing-board". The power-operated turret, the cannon gun, the shadow factory scheme, the R.A.F. Volunteer Reserve, the balloon barrage and the use of wireless long-range telephony on aircraft, all had their origins in the Swinton era at the Air Ministry.

Early in the war Lord Swinton was Chairman of the United Kingdom Commercial Corporation, a body formed to buy "pre-emptively" materials which might be of use to the enemy. It also supplied goods to the civil populations in countries behind the fighting line.

In 1942 he was appointed Minister Resident in West Africa. The fall of France and the closing of the Mediterranean had made West Africa a strategic highway both by sea and by air.

He set up a War Council and a Civil Committee and with their help organized the war effort of the West African colonies.

In October 1944 Lord Swinton was recalled to Britain to become the first Minister of Civil Aviation. Some of his proposals became the basis of the 1946 Bermuda Civil Aviation Agreement between the United States and the United Kingdom.

He was also responsible for the White Paper on British Air Transport presented in March 1945 (usually known as the "Swinton Plan"), reorganizing the British Civil Air Transport services.

While still in West Africa Lord Swinton had spoken of the possibility of converting the great network of military airlines to civil use. He visited South Africa in the spring of 1945 for a series of conferences on air communications between Britain and South Africa. The plan evolved for the United Kingdom-South African air route served as a model when the Commonwealth Air Council met in June under Lord Swinton's Chairmanship, for arrangements for the other main Commonwealth routes.

Lord Swinton has visited most of the Commonwealth countries since his appointment as Secretary of State for Commonwealth Relations in November 1952. He will address us on the subject of "The Commonwealth and Britain's Economic Recovery" . . . the Right Honourable The Viscount Swinton.

VISCOUNT SWINTON: Your Honour, Mr. President and Gentleman: It is quite a long catalogue of previous convictions which the President has presented. I will give you one assurance, that I know today I don't know it all, and that I have come to Canada to learn some more. The day a man thinks he knows it all he had better go.

I am so grateful to the two great Clubs for inviting me here and I am deeply grateful to the Prime Minister of Canada for inviting me to come back to Canada on this visit. I think visits of Ministers should be a two way traffic. Your Ministers . . . indeed, all the Commonwealth Ministers . . . so often gravitate to London, but it is enormously important that we in the British Government should come to you, and I think that applies particularly to whoever is the Minister for Commonwealth Relations. I am glad to say this isn't by any means my first visit. But I haven't been across Canada since 1932 and I am staggered by the progress which I find everywhere.

You referred, Sir, to my presiding over the first Imperial Economic Conference in 1923. In all the offices I have held it has been my good fortune to be very closely associated with Commonwealth affairs. In all those years the contact has never been closer or more constant than it is today; and what I think is more important, the mutual understanding and cooperation has never been greater. In the world today, with all its difficulties and uncertainties, we of the Commonwealth, all the Commonwealth, realize more and more that we are indeed members one of another, that there are common interests transcending any sectional differences and that broadly we must march together toward the same goal. And I have found everywhere in my visits to Commonwealth countries the realisation that together the countries of the Commonwealth and Empire have a strength and power for good, their own and other people's, far greater than any of us could enjoy in isolation. With us in the Commonwealth the paradox is true that the whole is greater than its parts. So I think it is that our interests and tradition all point the same way and in recent years we have stood together in our faith and in our unity.

When we in the United Kingdom and most of the other Commonwealth countries were in grave economic peril we came together in conference. You, in Canada, more happily situated, gave us your counsel and your help. I would like today to just relate something of the story of our recovery and progress at home in the three years since those dark days--and they were very dark days.

I was all through the economic crisis of 1931. I was a Member of the Cabinet that was formed in the National Government. But, frankly, the situation we faced then was child's play compared to the situation we had to deal with at the end of 1951.

Consider for a moment what our position was. Our great reserves of capital were largely exhausted. That was because we had thrown everything into two World Wars. We had to pay as we went. We were running into debt, we were running an adverse trade balance at the rate of over seven hundred million pounds a year. Our reserves were draining away at a perilous rate and the pound was at a discount: you could buy it at a different rate in half a dozen black markets. The world was beginning, I think, to lose confidence in us, though believe me, we never lost confidence in ourselves.

For the Commonwealth Sterling Area as a whole the position was the same. Taking us all together, we were running on the wrong side at a rate of over fourteen hundred and fifty million pounds a year. Well, we took immediate drastic action at home. We did a lot of very unpopular and unpleasant things. But when you have a mortal disease you have got to do pretty drastic things. Sometimes the surgeon's knife is the only way. Well, we did it. We were backed by the rest of the Commonwealth in doing it. In eight months, by the middle of 1952, we had turned the corner. We turned that adverse balance of seven hundred million pounds a year into a balance running well on the right side, and by the end of the year our trade balance was running at the rate of two hundred and seventy millions on the right side. All the other countries of the Commonwealth Sterling Area who had taken counsel with us took the same kind of action, and as a whole they can tell the same story. By the end of 1952 instead of running an adverse balance of fourteen hundred and fifty millions there was something like four hundred and eighty millions up on the right side.

Well, Sir, we have never looked back. We have gone steadily forward. We are still well on the right side, although we are importing more and have greatly liberalized out trade. In spite of the dollar gap which still exists in the trade between Canada and the United Kingdom, we have increased our trade with you. We have freed from import restrictions, from every kind of import restriction, your wheat, coarse grains, soft woods, lead, zinc, nickel and asbestos. We are importing nearly twice as much of your wheat as we did before the war, and we will go on doing that because, fortunately for you, in my country we can't grow hard wheat. The wheat we grow is soft and our people like a lot of hard wheat in their bread and we, being a democratic country, give our people what they want. Certainly we get very full agreement on that. We are increasing our imports of newsprint. We have increased them. I think we shall import another hundred thousand tons next year. We are increasing our imports of chemicals, cheese, and, not uninteresting to this Province, we bought three million dollars worth of apples when the axe went down across the border. I hope we shall still take them in spite of hurricanes.

Now, in some sense, that is an act of faith, because as I say, the trade balance is still very heavily in your favour. Something like a hundred and forty millions sterling ... I can't do the sum in dollars ... last year. But it is an act of faith which we believe will be justified by works on both sides. We believe ... indeed, I think it is self-evident ... that there is a great and growing opportunity for trade between us. Our two markets are essentially complementary. We need what you can give us and we can give you what you need. You will find our market a steadily increasing outlet for your products. I say we can fulfil your needs. Our position today I think is the best guarantee of that. Our production is the highest it has ever been.

On the export side we can tell the same story. Our reserves which drained away so disastrously are up by over twelve hundred million dollars, and they are up in spite of the fact that we are paying off a lot of dollar debts and that we are doing a great deal of dollar importing. The reserves are up. Confidence is restored. We have abolished controls. We have reopened our great market exchanges like the Liverpool Cotton Exchange and the Metal Exchange to the whole world, and the whole world is doing business at them today. The pound is steady. We can look any currency in the face.

We will never forget what we owed to you in Canada and to your neighbours in the United States "for very present help in trouble". I think we can claim that we have used that aid well, and you can feel that like manna from heaven you have helped those who have helped themselves.

Well, Sir, that is the story. I haven't exaggerated it at all. I think it is a pretty good story of cooperation and success and we may be modestly proud of it. But let me give you this assurance; the last thing we are at home is complacent. There will be no relaxation of effort on our part. We know we face increased competition on all hands. We are not afraid. We know there is no easy road ahead of us and no short cuts. Easy roads mostly lead down hill; but I promise you that we are going on the road which has brought us back from the brink of disaster to where we now are. In all this we have been a. united nation and, as I say, we mean to follow that road. We know it means hard work. We are not in the least afraid of that. We know it means increasing our production without raising our costs. We will do that. What do we have? Last year our production was seven per cent up on the year before, and the year before was quite a lot upon the year before that. It has meant selling in competition. The sellers' market is gone forever.

Well, we are facing up to that. Our exports this year, are nine and a half per cent better than last year, and last year was a good deal better than the year before. And we have done that in spite of a downturn in the American economy, comparable to that which in 1949 knocked our economy endways. We have taken it in our stride.

To complete that policy, for its success, we need the development of Commonwealth resources and Commonwealth trade. We want to trade with the whole world. There is no question of choosing whether we trade with the Commonwealth or with the rest of the world. We must do both. Indeed, all past economic history shows that the more we, the countries of the Commonwealth, trade with one another, the more we can trade with the world outside. We have in our country, as you have in yours, great resources, physical, scientific and, I would say, spiritual. We have what is perhaps the best asset of all "goodwill", founded on our unique experience of a century of world trade, merchandising, finance, insurance, shipping and, now, the air. We have that experience. We have the "know-how", and something more ... a century of integrity. Is not that the real meaning of the "Freedom of the City" London, Liverpool--all our historic marts--the knowledge that business done "on the nod" is as binding as the most formal contract . . . the certainty that any contract or deal will be honoured to the full whether it be to our own interest or not.

Sir, that is a great asset and a priceless heritage. But I wouldn't have you think for a moment that we are just living in the past, relying on the past. We are not doing anything of the sort. We are building on the past a new edifice of all kinds of inventions, improving our old industries and developing the new.

You spoke, Sir, and far too generously, of my share in building up an Air Force in which so many of your best men fought. Well, we won through . . . we had the best fighters as well as the best pilots. I know something of that for I took them all off the drawing board. You mentioned Radar. It is called an American name today but it wasn't an American invention, it was a British invention and for some years it was called Radio Location. I will tell you the story of Radar.

When I went to the Air Ministry I said to the Chiefs of Staff: "Now I am going to bring in some of the greatest scientists in England."

They said, "You mean as advisors?"

I said, "Oh no, I don't mean that at all. I mean they are going to be as much an integral part of the operational staff as you yourselves; they will know everything and they will originate." And there they were, the four greatest physicists of the time, and one day as I was taking a meeting of the General Staff and the scientists, I casually said, "What would be the greatest revolution you could have in he air?"

Somebody, I think it was a young Staff Officer, not one of the great brass hats, said, "Well, Sir, supposing we could know where an aircraft was a quarter of an hour before it got here." That seized all our imagination.

Suppose there need be no patrolling and the fighter could go up with all his petrol on board. He would know where to go and know where to find the enemy. And I said to those great scientists, "Gentlemen, there is your problem."

They deliberately set to work to find the answer to that problem and I asked them a week or two later, "Did you do anything on this?"

They said, "Well, we are on to a line that we think is the most hopeful one."

The consequence was that in an incredibly short space of time the answer was found-Radar.

And by the time the Battle of Britain came the whole of Great Britain was ringed by radar stations.

Well, that wasn't a bad story. Of course the men who won the Battle of Britain were the pilots and yours were on every figher field. But they couldn't have won it without the machines they flew and the radar which guided them.

There was one thing we had to give up in the war and that was transport aircraft. We were making the best fighters and the best bombers, so we concentrated on these and on transport aircraft we fell behind. But look at the position now . . . we lead the world. Take our modern jet civil aircraft . . . we just can't execute the orders that are coming in from every country, whether this side of the Atlantic or the other for the Viscount. The Comet will be flying again soon. We know what was the matter with it.

Then engines ... we have led and still lead in the Jet. You already, I am glad to say, are manufacturing on our patents.

Then, another thing connected with the air, that amazing device which is called a Flight Simulator. You know it. You are buying and using it. You have a cabin in which the whole of a crew of an aircraft can be posted and in which every change and chance which that aircraft can encounter is reproduced at the cost of a few cents of electricity. Well, that is another great British invention. You have been buying them for your Air Force here. Other countries in the Commonwealth and elsewhere are ' doing the same.

I could talk to you about other things like Terylene--I think you call it Dacron over here. We invented it. Rather like Radio Location which became Radar, Terylene becomes Dacron; but it is British all the same.

Now, Gentlemen, I read the reports of companies, and of a great variety of businesses. I read in many annual reports . . . of this or that new process; a variety of inventions all doing well . . . giving greater economy and increased efficiency--and all selling well. These processes and inventions which we are applying in our industries, old and new, are the product of research stations in which if you go and visit them as I have, you find not only the whole of the firm the management and the scientists in industry--but the workmen too are taking a deep interest. I went and opened an extension a year or so ago in Yorkshire of the great wool research project there and I found it was a cooperative effort of the whole industry. I found the trade union men there were just as keen as was the most efficient firm. That is all very heartening and all this, of course, has been of great value to us.

But it can be and should it not be of equal value to you. Sir, this visit of mine has impressed upon me daily the tremendous opportunity there is for trade, for unfettered, increasing trade between our two countries, and so I would give you this message today: In our common interest let us make this more and more a partnership effort, free, independent, but united. And so it will be said of every country of the Commonwealth, as it was of Britain long years ago, and as it can surely be said about Canada and Britain today, "All our past proclaims our future . . . England still shall stand."

THANKS OF THE MEETING were expressed by Mr. Hal Linton, President of The Canadian Club of Toronto.