London

ON THE WORLD TODAY

THE British Labor Government, after flirting with socialism, is now more boldly walking out with the girl. The affair has taken a more serious turn, including honorable intentions and all that, since the Government presented to Parliament the bill to nationalize the entire coal industry.

The bill charts the course for transforming the coal fields and all their appurtenances from private ownership to a modernized state enterprise. Coal is a problem with its own peculiarities in Britain, and this fact explains why a sector of the public which otherwise shrinks from socialism has welcomed the Government’s coal legislation as a good beginning.

In proposing to take over the coal industry, the Government is legally adopting a pale, emaciated orphan. Production has sagged to 180 million tons a year from 230 millions in 1939. Coal supplies to factories are limited, and there is scarcely enough fuel for domestic use to keep people warm in the chill and fog. Miners are working hard at poor wages, and in six years their number has dropped from 766,000 to 697,000. Almost one fourth of the total labor force consists of men above the age of fifty.

Much of the machinery is antiquated. By giving priority to mechanization, the Government’s bill shows enlightenment. Within five years the national treasury will lend up to 150 million pounds (about 600 million dollars) for equipping the mines with up-todate installations. Only the state could have offered so large a sum. Upon this capital for technical improvement depends the industry’s future.

Much more than comfortable homes and smoking chimneys is involved in this attempt to resurrect Britain’s coal output. Full employment is at stake along almost the whole range of the nation’s life. An ample surplus of coal for export has been a major source of revenue enabling the British to pay for imports of essential food and raw material.

Coal has played a crucial part in British history. It was the center from which radiated the industrial revolution that reshaped the character of the country, marking the passage from feudalism to capitalism, just as it is now leading from capitalism towards socialism.

A National Coal Board

The new bill sets up a National Coal Board with nine members. The board will have three duties: working and getting the coal; developing the industry efficiently; and “making coal supplies available in such quantities and at such prices as may seem best calculated to further the public interest.”

Until lately coal was just raw fuel. With the rise of new industries like synthetic rubber, oil, and plastics, the by-products of coal are surpassing the importance of coal as a generator of heat. In the coming years the state-owned coal mines of Britain will have to keep abreast of the new technological age.

The Coal Board will be appointed by the Minister of Fuel and Power and will be responsible to him. The Minister in turn must answer to Parliament, and Parliament to the people. Members of the Board are to be chosen for their experience and specialized qualifications, and will represent neither workers nor management. The bill suggests that the Government will tempt skilled engineers and other technicians to stay at their mining jobs or to enter this field as public servants.

Two councils will be created, one representing domestic consumers and the other industrial users. They will advise the Government on the quantity of coal needed, on prices, and on distribution.

There is to be no confiscation. The Government offered the mine owners a lump sum of about 200 million pounds (roughly 800 million dollars), but they refused it. Instead of delaying the industry’s nationalization until the owners’ claims are settled, Emanuel Shinwell, the Fuel Minister, is going ahead with the transfer of mining properties to the state and has asked Parliament to pass the necessary law.

A tribunal of two Supreme Court judges and one accountant will fix the compensation. This state payment will indemnify the owners not only for the mines but also for ancillary property like coke ovens, freight cars, and existing stocks of coal and timber. The tribunal will assess the value of these assets at the sum those properties would realize if sold in the open market by a willing vendor to a willing buyer.

Compensation is to be paid in government stock, not cash. The present owners are to be reimbursed according to the annual revenue which the industry could reasonably be expected to maintain if it were not nationalized. The tribunal will fix the number of years for which the expected revenue will be capitalized.

Right and Left dissent

Conservative opponents of the bill are singling out for attack the payment of stock instead of cash as compensation. More particularly they are criticizing the bill’s provision enabling the Government to forbid coal companies to buy or sell such stock. Apparently the Government fears that open trading in this stock would attract money otherwise available to purchase new government securities. The Government’s proposed right to restrict the marketing of this compensation stock is denounced on behalf of the investors by the weekly Economist as “monstrous tyranny.”

The whole “willing seller-willing buyer” basis for the compensation scheme is under fire from the leftists, who denounced it as meeting the capitalists on their own terms. Leftist critics maintain that the scheme creates a precedent for other industries earmarked for nationalization. They say, “ Let the Government establish a fair return for the small investors, and to hell with the rich owners.”

Parliament will debate and pass the law nationalizing the coal industry amid a flood of other legislative business. Approval (muttered through clenched teeth) of the American loan to Britain and of the Bretton Woods Monetary Agreements, just before the Christmas recess, freed the House of Commons for tasks among which socialist measures will become more conspicuous.

Britain gags on American credit

Of the British attitude toward the United States credit, one of the truest comments was that British opinion is divided between those who believe the Anglo-American financial deal is a necessary evil and those who believe it is an evil. Once the British negotiators in Washington had won the best terms obtainable, the majority in Parliament reluctantly approved. The House of Lords might have tried to reverse the decision if it had not feared that this act would precipitate a crisis threatening the very existence of the upper chamber.

For Parliament to have rejected the loan, it was said, would have opened a trade war between the sterling bloc and the dollar, and would have endangered Anglo-American friendship. What was less often admitted was that without this American help Britain would be doomed to a bleak living standard for more years than it cared to contemplate. Britain simply had to have enough dollars to buy American food, materials, and the machinery needed for industrial reconversion. She could not afford to reject the loan.

Informed criticism was not aimed at the terms of the loan. The $3,750,000,000 of new money at what will amount to 1.63 per cent interest for fifty-five years, combined with Britain’s right to waive interest payments in bad trade years — all this was acknowledged to be generous.

There were those who argued that America ought to have given an interest-free loan because Britain had lost one fourth of her total national wealth in our common war. But a ready answer to this was the renunciation by the United States of all but 650 million dollars in payment of the 15 billion dollars of Lend-Lease supplies to the United Kingdom.

British teeth were set against a promise not to restrict imports of any commodity from the United States unless British imports from the Commonwealth are proportionately cut. Critics also stressed that American tariffs, even after an all-round reduction, would remain higher than those of Britain and other countries. Financial writers insisted that the very conditions imposed on Britain make certain her future default on this new debt.

Conservatives recoiled from American dictation of British economic relations with the Empire and with the world generally. Socialists resented a return to what they consider an unplanned competitive policy and outworn free-trade practices which clash with state-managed economy.

Before the loan agreement, the Government had announced that Britain, to get back on her feet, must raise her exports 50 per cent beyond their 1938 volume. The obligation to repay the American loan with interest is said to make a 75 per cent increase imperative. To reach that target, it is estimated that Britain would have to capture and hold 40 per cent of all world markets for manufactured products — an impossible feat.

The Parliamentary debate and the press persuaded most Britons that the entire American credit will be exhausted swiftly and that Britain has bought a short breathing space at a steep price. Talk in the lobby of the Commons suggested a revolt of the British colony against its American sugar daddy. The London Economist, remarking that beggars cannot be choosers, added, “But they can by long tradition put a curse on the ambitions of the rich.”

The international horizon clears

Meanwhile the gloom which has overcast international politics since the collapse of the conference of the five Foreign Ministers in London on October 2 has been partly lifted by the results of the ByrnesMolotov-Bevin Christmas meeting in Moscow. Except for those who in advance see a sellout to the Bolsheviks whenever Great Britain and the United States take their seats at a table with the Russians, British opinion has welcomed the Moscow agreements as easing a tense world situation.

Admittance of the Soviet Union to a share in the control of Japan was bound to provoke less concern in Britain than in the United States, because the British are less interested in Japan than are the Americans. Even before going to Moscow, Bevin had privately expressed the view that United States domination in Japan was the principal cause of Russia’s growing distrust; and if America was willing to yield a point to Russia there, why should Britain object?

Britain’s desire to limit the spread of Soviet influence in Asia as well as in Europe has not prevented the British from questioning the wisdom of United States policy in Japan. The London Times expressed an opinion that a number of people hold when it mentioned the weakness of the American policy, which is attempting “a moral and material revolution in Japan through the present governing classes. So long as they remain in power, the social system for which they stand will endure.”

What is the use, it is asked, of depriving Shintoism of its status as a state religion, if the practice of this religion continues to inculcate obedience to the Emperor and the myth of racial superiority, which are the most formidable obstacles to democracy in Japan?

The decision of the three Foreign Ministers in Moscow to restart preparation of the European peace treaties on a pattern combining Soviet and American proposals for procedure was accepted in Britain as common sense. Bevin at first had doubts about this procedure. He was loath to present France with another ready-made Big Three solution and thus risk alienating the French at a time when Britain is hoping that 1946 will see a new Anglo-French military and political alliance.

British comment has approved the plan for setting up the United Nations Commission for the Control of Atomic Energy and making it responsible to the Security Council. The belief in London is that this commission will talk rather than act; and, doubting that international inspection of atomic-weapon plants will in fact be permitted, British diplomats are privately skeptical of this part of the results of the Moscow Conference.

There is disappointment at the failure of the conference to check great-power rivalries in Persia and Turkey, which are much more important to Britain than is Japan. And the intention of the United States and Great Britain to recognize the pro-Soviet Rumanian and Bulgarian governments after slight changes in their composition is regarded as a distinct Russian success.

Awareness that the Byrnes-Molotov-Bevin negotiations left many major and minor conflicts unsettled is subordinated in British comment to relief at the narrowing of differences between the Soviet Union and the West.

Picasso-Matisse fireworks

Despite their preoccupation with big league politics, the American loan, and the United Nations and Britain’s veering towards socialism, and despite their worry about housing, short rations, and fuel, Londoners have been diverted by a racy controversy about the paintings of Picasso and Matisse. An exhibition of the work of these two artists at the Victoria and Albert Museum resulted in a flare-up of the temperament which the English are not supposed to possess.

It began with a public protest by a woman who clapped her hands and gathered an impromptu audience in the room where the paintings are being shown. The quarrel raged between apoplectic Blimps, who regard everything painted in the past eighty years as rubbish, and young enthusiasts, for whom the history of art begins with the French surrealists. Some of the reputable critics remained silent, remembering perhaps that nineteenth-century painters like Gauguin and Cézanne, and artists of the Barbizon school before them, had been targets of similar anger, derision, and adulation.

A jaded newspaper reader satiated with daily columns of politics and economics expressed his gratitude that thanks to the Picasso-Matisse fireworks, “several organs of the press are giving space to something serious for once.”