South Yorkshire Times, March 11th, 1944
Home Secretary at Mexborough
Partnership of State & Industry Envisaged
Organised by the Don Valley Divisional Labour Party, a well-attended meeting at Mexborough Secondary School on Saturday was addressed by the Rt. Hon. Herbert Morrison M.P. Home Secretary and Minister of Home Security. The Rt. Hon. Tom Williams M.P. for Don Valley and Joint Parliamentary Secretary to the Ministry of Agriculture presided.
Mr. Morrison, who was accompanied by General Sir William Bartholomew (Regional Commissioner), spoke on private enterprise and the future partnership between the State and large-scale industry. Mr. Morrison was accompanied by his daughter and son-in-law, Mr. and Mrs. Horace Williams. Mr. Horace Williams is Mr. Tom Williams’ son.
Demand for Social Security
Mr. Williams referred to the disillusionment of people after the last war, and said there was now a desire for more widespread social security once peace arrived. There was a desire for a great advance in education and public health services. They were anxious to see the Government proceed with a gigantic housing scheme. They wanted full employment and a prosperous agriculture.
Saying he did not wish to see Government control for the mere sake of control, Mr. Williams said if they were anxious to establish freedom from want, they must have the best possible use of industrial resources or they would have a rude awakening in future. Control or no control, it meant in future that the State had to have a more active part in directing the economic policy of this country.
Abandonment of Competition
Pointing out that to-day the principle of unrestricted competition had been abandoned, Mr. Morrison said the instinct of combination was now given free play while competition was restricted, and in its extremer forms disapproved of by the altered moral sense of the community. Important Industrial firms no longer engaged in a life-and-death struggle from which the most efficient emerged triumphant; they even at times combined on terms calculated as far as possible to allow the least efficient of them to survive. A hundred years ago it might have been said that the economic system of Britain was private enterprise tempered by survivals of feudalism. Today, our big business was a system of monopoly tempered by survivals of private enterprise. To call the whole system “private enterprise” was a grave misnomer and to justify it on the moral grounds formerly used to justify private enterprise was a disastrous confusion of thought.
The moral basis of the system of private enterprise was at one time a system of rewards and punishments, said Mr. Morrison.
The community no longer believed in the rewards of private enterprise as the Victorians did. If you wanted people to risk their money, their energy and their working lives in order to develop new ideas and new processes, you had in a system of private enterprise to offer them very substantial rewards. You had to allow them to make their millions, or at least to have a chance of making millions. Nowadays we did not believe in millionaires – even the millionaires did not. They hastened to give their money away in large lumps.
No Extremes
Mr. Morrison said we no longer believed in extreme inequalities of wealth. The State set out to remove them. He did not suppose that present levels of taxation would continue quite where they were indefinitely after the war. On the other hand, it was most unlikely that we should turn our backs on the system of income tax and super tax which hit the rich man hard and tempered the wind to the shorn lamb.
Nowadays he had a social conscience. We did not readily accept scrap-heaps as part of the social landscape. This had been one of the factors in the growth of combine and monopoly. It became morally repugnant to deprive the less efficient competitor of his livelihood; much better to fix prices at a level that enabled him to survive, and safeguard his own level of profits. On the side of the workers the social conscience operated even more decisively. Private enterprise in the hey-day used to exercise an unlimited right to hire and fire. It needed this right, it claimed, to maintain discipline, to weed out what is called the slackers, to reduce costs in the interest of successful competition, and to adjust the scope of business to the extent of demand. ,Nowadays this right of private business to inflict the penalties of unemployment and want in its own interest had been seriously challenged.
Saying that the right of mass dismissal might still be exercised on some few occasions after the war, Mr. Morrison said he was sure the few occasions would be few. Public conscience would back organised workers in a refusal to recognise such a right of mass dismissal. The whole of the emphasis we were now increasingly placing upon full employment, meant denial of this right to throw the unwanted on the scrap heap. The conscience of society today would not accept unemployment as part of the natural order of things, and still less would it accept unemployment as a weapon in the hands of competitive business.
“Let us stop bandying words about the profit motive and the virtues of enterprise and the dead hand of State control, and let us instead look at the actual facts as they are developing and coming into being around us. If we do, we shall see, I think that we are moving into an altogether different form of society, working in an altogether different atmosphere of ideas,” said Mr. Morrison. If we set out to forbid combination and to enforce industrial competition, we might find we are fighting against the tendency of the time. There were very strong arguments for combination and association; these things made for economic stability. They simplified the making of reasonable wage agreements and they were at times a safeguard against the throwing of businesses and workers on the scrap-heap.
Mr. Morrison suggested the close rearing-up of business combination and associations to sound public policy – the granting to public authority of a large or possibly complete measure of power over them. This did not mean bureaucracy or Treasury control. Public control could be exercised by public corporations with a good deal of business freedom, but with sufficient measure of public responsibility and accountability to ensure that they served the public interest. He did not pretend that this solution was without its problems. It pre-supposed the existence of a pretty large class of administrators who possessed both business capacity and drive and the sense of public duty and responsibility of an enlightened civil servant of the State in the sphere of industry and business was enlarged as quickly as possible and put to work in the right places. An actual practice, the degree of public operation of business could not be extended over the whole fields of large-scale business and industry for some years to come so they would inevitably have to make the experiment of enforcing competition in some parts of the field and imposing a measure of the State regulation of prices and restrictive agreements in other parts.
Form of Partnership
“For some time to come we shall in Britain be working out a form of partnership between the State and large-scale industry,” said Mr. Morrison. They would be experimenting with different types and degrees of State power over industry, varying all the way from full public ownership and operation to a limited degree of control of prices and practices exercised from outside. Public Interest must be the paramount consideration and private ownership of big business, instead of being regarded as a God-given dispensation, should be regarded as something being required to justify its social utility on its trial.”
After the war, we were committed to a policy of full employment. This meant a policy of economic expansion and this in turn, the use of the resources of the State to ensure full, effective demand on the part of customers and full, effective activity on the part of productive industry. Every form of industrial organisation would have to be required by its ability to operate effectively as part of the new expansive, economic system. It was said that cartels and associations were inherently restrictive – that they only acted in a restrictive way in times of economic slump and decline. It remains to be seen if that were true, and the State could take no risks about it. Its relation to these great organisations must be such that it could ensure they would not throttle the beneficent processes of economic expansions by charging high prices, limiting output by undercover methods, keeping relatively inefficient firms in being, or burdening themselves and the community with unnecessary costs of any kind.
“We have to provide for the mass of people a chance to work,” said Mr. Morrison. Idleness of either rich or poor was an undesirable state of affairs. It was a tragedy that men and women willing to work should be denied the opportunity, and although there was unemployment benefit, no healthy minded man preferred that to employment. There was something wrong in the economic system if they were to be afraid of producing too much. We wanted full employment for all and a better standard of life. Our greatest standard of life was better than it was 50 or 100 years ago, and so it should be, because the industrial capacity of men and women went upwards. We could make it better for men and women to feel that the more they worked the more they were contributing to the well being of the nation and their own advancement. Finally, we had got to lift industry above a sense of merely “drubbing” along and merely seeking existence. There should be a sense of social utility and high moral venture above industry. They should be made to feel that as long as they worked a fair time the rest of their time was for comradeship and the development of their education, knowledge culture and souls. Business and commerce should not be things in which they were crawling on their bellies hoping to pick something up, but things in which they could seek social security and advancement for the human race.
A vote of thanks to Mr. Morrison was proposed by Mr. Ben Gething and seconded by Ald. G. Schofield J.P. In thanking Mr. Morrison for his excellent address Mr. Gething offered the opinion that the world was all right but it was the people who lived in it who were wrong. He disagreed that material considerations should come first and considered spiritual things should be given precedence.