I would claim the right on the Report Stage to deal with the Bill as it has come to us from the Committee, its principles and its details, and the principles and the details of any clause or section of the Bill. I am not going to do that, but I claim that one would be entitled to do that under the Standing Orders and the Rules of Debate of the Dáil. I want to call attention to a matter which was raised in the course of Deputy Hewat's speech in this matter, which reminded one of the fair and reasonable contention put forward by Deputy Figgis that the Advisory Committee to be appointed under Section 1 ought to be a different Committee from that appointed under Section 2. Deputy Hewat's speech rather added to the weight of that argument. One could quite understand that a gentlemen of the experience and interests of Deputy Hewat might be appointed upon an Advisory Committee under Section 1, but such a person with such an experience and outlook would not be a desirable acquisition to the Committee under Section 2, because the bias of his interests and outlook would militate against the proper working of Section 2.
I think, therefore, that the question of the constitution of the Advisory Committee might well receive further consideration in the Seanad. But I want to raise another question that is involved in this whole Bill, and to point out to the Dáil the way it strikes me as to the effect the Bill is going to have and what it is we are actually doing by passing it. I am glad we are passing it, and I hope it will become law immediately, and that it will not be the last of similar Bills that will also become law. We are, by this Bill, authorising the Ministry to inflate currency to the extent of £1,000,000, authorising them, as a matter of fact, to do the work of banking institutions, and to determine the direction which industry to the extent of this advance will take. I think it is a pity that this is not to be done direct, although it is quite conceivable that within the scheme of the Bill it might be done direct, but I rather anticipate that it will be done through the banking institutions, and they will give credit on the backing of the State. I would rather these credits were given through a State Bank. I hope, to some extent, that will be done. The issue of £1,000,000 worth of credit, which is in the greater part to be expended to promote employment, and presumably for reproductive purposes, will, no doubt, bring a quick reward, and to the extent that moneys of this kind are advanced, which, in their effect, cause inflation, inflation for quickly reproductive purposes, is not harmful but good. It will promote employment and will bring immediate benefit to the community.
I am following in this contention no less an authority than the Chairman of the Midland Counties and Westminster Bank—I mean Mr. Reginald McKenna —and as a matter of fact there can be no question that if the State banks were to loan in this way, and were in effect to advance money on the future tax-paying capacity of the community, and if they were going to do that to the extent of £1,000,000 for directly productive purposes, without great harm and, as I think, probably with great good, I hope the lesson will be borne in mind, and that we might use the same method to an even greater extent and advantage. We shall be using this money for capital expenditue, which will be slowly reproductive. We might use large sums of money by the same method, advancing State credit for the production of wealth which might be recovered within the year, I mean agricultural wealth. I suggest that the method adopted by this scheme, if applied to the payment of wages for the production of food, would be quickly reproductive and would be entirely beneficial.
There is another point that I want to make in this connection, and it is this. If, as I contend, the granting of loans of this character, backed by the State, based upon potential taxable capacity, in effect inflates currency, the effect may be to raise prices generally. The raising of those prices in reality means that the community is paying for the capital that is sunk. Unfortunately, when this financial operation is done through a bank the community is not only paying for the capital expended in increasing prices through inflation, but is also paying over and over again through interest on the capital which is being apparently lent by bankers but which is in reality lent by the State on the real credit of the country, which is based upon future potential production. I may say that I am glad the Bill is passing, and I hope the lesson to be drawn from it will be learned and repeated.