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ESSAYS IN PERSUASION

PART

Thus the direct effect of an expansionistpolicy must be to cause Government borrowing,to throw some burden on the Budget, and toincrease our excess of imports. In every way,therefore—the opponents of such a policy pointout—it will aggravate the want of confidence,the burden of taxation, and the internationalinstability which, they believe, are at thebottom of our present troubles.

At this point the opponents of expansiondivide into two groups—those who think thatwe must not only postpone all ideas of expan-sion, but must positively contract, by whichthey mean reduce wages and make largeeconomies in the existing expenditure of theBudget, and those who are entirely negativeand, like Mr. Snowden, dislike the idea ofcontraction (interpreted in the above sense)almost as much as they dislike the idea ofexpansion.

The policy of negation, however, is really themost dangerous of all. For, as time goes by, itbecomes increasingly doubtful whether we cansupport our standard of life. With 1,000,000unemployed we certainly can; with 2,000,000unemployed we probably can; with 3,000,000unemployed we probably cannot. Thus thenegative policy, by allowing unemploymentsteadily to increase, must lead in the end to anunanswerable demand for a reduction in ourstandard of life. If we do nothing long enough,there will in the end be nothing else that wecan do.