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Dáil Éireann debate -
Thursday, 31 Jan 1952

Vol. 129 No. 2

Private Deputies' Business. - Underdevelopment of National Resources—Motion (Resumed).

Deputy Hickey referred to the charge imposed on the weekly rent of a municipal house by the interest rate payable by a local authority for the money it cost to build it. I should like to hear anybody argue the justice or equity of the people, through their public representatives, being required to pay for the use of their own money. Eighty per cent of the money in circulation in this country and in every modern society is bank money. I should be grateful to somebody in this House who would expound for me the ethical or economic justification for asking the people to pay a limited group of persons, to wit, shareholders in joint stock banks, £35 a year for the right to use £1,000 of their own money.

A municipal house to-day may cost up to £1,500. Leave out altogether the annual allocation for the redemption of capital. If the municipality has to borrow that money at 4 per cent., the interest on the money required to build that house amounts to £60 per year which the tenant must pay, except in so far as the taxpayer pays it. If it is the tenant, a weekly rent of approximately 22/- is payable by the tenant for no other reason than that the normal banking system of the country is used to discharge the debt due to the contractor on completion of the house and his delivery of it to the municipal authority. There is no question of security and no question of any danger of the capital not being repaid.

It is merely the period of time over which the Legislature determines in its own wisdom that it is expedient to repay the capital. This strange fact is true that while it is regarded as axiomatic that money borrowed by a Government on which a municipality builds houses should be liable to this charge, from the moment that the three great societies of the world became involved in war and similar accommodation had to be procured in order to pay the armament manufacturer for the tanks and guns, no one contended that for an outlay of that kind the Government should be asked to pay—and none is paid. A management charge of something between I and 1? per cent is payable because there is no cheaper way of getting the accounts checked and that percentage meets the legitimate cost of the banking system in administering these loan accounts on Government account. The rate payable on such borrowing is ruled by the ascertained cost, as near as they can go, to the banking system for keeping the accounts.

Now, famous bankers of the 19th century have said that it was a dispensation of Providence that the average man could be depended upon never to unravel the mystery of money and credit and that, therefore, those who control it were in a position of absolute safety. They were mistaken in that belief. The average man does understand in very large degree the workings of money and credit. But here is our danger: the average man understands it in large degree but there is no subject on which the aphorism is more true, that "a little knowledge is a dangerous thing". The moment the problem of money and credit begins to appear simple and obvious to an average man, you may assume that he is either daft or stupid. The more this problem is studied and understood the more its infinite complexities confront the inquirer. I do not purport to follow the theory of money to its source. An attempt of that kind could not be encompassed in a book of less than 400 pages. For Deputy Hickey's information, I may mention that Geoffrey Crowther wrote a very good one, which the Deputy might with profit peruse.

I am simply applying my mind, and I am inviting the House to turn its mind, to one simple facet of the larger problem to-night. I urge the Minister for External Affairs to make the case, if it can be made, for requiring the community to pay 3½ or 4 per cent on its own money to provide essentials without which the community cannot properly function. When he has done that I ask him to enlighten my darkness on the issue of how it can be right, proper and orthodox to furnish the Government with money at 1? per cent to defend the public and the community from external aggression, but to forbid the community to avail of a similar amenity when the war is against disease and destitution. Let us make a note of this, for it goes to the heart of the matter that we are talking about, the borrowing of capital sums is an operation which predicates a redemption sinking fund to be raised annually from the revenue of the community. You cannot substitute credit for revenue, but if your revenue is sufficient to provide a redemption annuity for a capital borrowing there is no reason to make that annual charge more than that by adding to it an interest charge for the benefit of a few at the expense of the community to which that few owe their very existence and their opportunity of carrying on with the banking operation, the services of which the community proposes to avail of.

There is a last matter to which, I think, the Government might properly turn its mind. When the Central Bank Act was enacted I think a section was inserted therein providing that, in respect of the currency reserve, 100 per cent. cover in the form of British securities or British legal tender was to be maintained, subject to the proviso that if the board of the bank took the initiative in proposing to the Government that a proportion of that currency reserve should be invested in Irish securities, and if the Minister for Finance gave his approval, the board would be entitled so to invest. The very insertion of that section in the Central Bank Act demonstrates clearly that those who were responsible for it envisaged conditions in which such a departure might with propriety be made. In one long answer which the Minister for Finance gave to a question relating to that matter, he spoke of the Central Bank as the bank of the last resort. How you can have a bank of last resort without a money market such as functions in the City of London, in the sense of that term, is something that baffles me.

Probably the lender of last resort.

How can you have a lender of last resort without a money market?

Somebody has the power to create currency.

I know, but why use a euphemism for the Bank of England?

It is not for the Bank of England.

As I understand the term "lender of last resort," it means that where the money market, the bill market, fails to get money from any of its usual sources—its own capital, its own deposits, the joint stock banks—it may discount its Treasury bills with the Bank of England; but the restriction on that is that, if they go to the bank of England for that accommodation, they are charged not the market rate but the bank rate, which is usually 1 to 1¼ per cent. above the accommodation rate from the joint stock bank or the discount houses. Now, a lender of last resort, in the position of the Bank of England, must be ready on demand effectively to encash for the bill market of the city where it functions, all the Treasury bills outstanding in the hands of the bill market, if for some reason the ordinary bank houses, such as the joint stock banks or the other financial institutions of the city, are temporarily unwilling or unable to provide the bill market with the liquid resources which are required. There is no money market in Dublin, and there is not any machinery analogous to a money market in Dublin. How then is the person for whom the Central Bank is the lender of last resort, in the sense I have outlined, which is the sense that imposes on the Central Bank the duty of high liquidity, to obtain these facilities? The only duty I know of devolving on our Central Bank which envisages the possibility of a rapid production of legal tender, is carrying out of its undertaking when there is a run on the bank to convert Irish currency into sterling. The method by which we maintain sterling is the undertaking on the face of our note that if any one brings that note to our agent in London, our agent will give him a Bank of England note. So far as I know the essential liquidity can only arise in that context, but if Deputies will only stop to think for a moment, our currency at present is to the order of £58,000,000.

Suppose every single note of our currency were transported by boat or aeroplane—and, mind you, they would have to be transported to England because the obligation to pay English notes only arises at our agent's office— and people drove to our agent's office in London with pantechnicons full of currency notes. The office does not open until 10 o'clock. They would then have to carry in the currency, mountains of it, and the cashier would have to start thumb-counting it, note by note, working to the best of his ability to count 58,000,000 notes. I reckon that, counting as fast as he could, and even taking his dinner at the desk, he could not hope to count the amount in less than six weeks, working a full day, and, remember, he would then have to count the other stuff out. The stock exchange accounting period is three weeks. Even if a run began on the first day of the account, the British Government being a rational sensible institution, does not want £50,000,000 of its war loan sold on the British stock exchange on a Monday morning. As the British Government disposes of funds in its own various Government accounts of several thousand millions, does anybody seriously suggest that if a queue formed outside the office of our agent in London and claimed conversion of these notes, the agent would say: "There is £50,000,000 of war loan here; we shall have to go to the Government stockbroker in Lombard Street and say to him: ‘Dispose of that and issue £50,000,000 in English notes, because there are so many lunatics who want to change our notes into your notes?'" You can then imagine a line of steel vans drawing up at the agent's office, packed to the roof with Bank of England notes, the poor citizen sitting inside the office of our agent counting the Irish notes in and counting the British notes out, and a notice hanging outside the door saying: "Let nobody in the queue fear; there is £50,000,000 in notes packed in under the desk here and as fast as we can go to it we shall pay you. Meanwhile, if anyone wants an umbrella or a rug to keep himself warm, we shall be glad to supply it, and we shall give you camp stools if you require them." That is a literal description, as I understand it, of the sterling link as at present operated.

The way the sterling link is maintained by our Government is that if anyone offers a pound note to the Central Bank of Ireland and asks a British pound note for it he will get it, and we maintain our agent in London to do that. If you want to hold the Irish Government to that undertaking the way you do it is to bring your note to the agent's office in London, where you are entitled to get British currency for it. Thus, for every pound note a cattle dealer pays out or that a shopkeeper receives, if he wants to purchase something in England with it, he can go and get a Bank of England note and pay for whatever he wants in England with the proceeds.

The Minister for Finance said that the Central Bank of Ireland required to maintain a high degree of liquidity because it was a lender of last resort. So far as I know, its functions as a lender of last resort can only come into operation under the circumstances I have described—far different from the position of the Bank of England which, as I have tried to explain, is a lender of last resort to the money market in the City of London, while it is true that, even as a last resort, in the limited sense that that term applies to the Central Bank of Ireland, it must maintain a genuine and real readiness to redeem the promise printed on the front of our note—and there must be no hugger-mugger about it. The question is whether it is necessary to maintain the whole of the currency reserve in British Government securities because that operates to leave us with a very modest return on a large capital sum at a time when we ourselves find it necessary to borrow. But if wise heads remain convinced that the preservation of certainty in regard to the convertibility of our currency with British currency depends on 100 per cent. currency reserve, surely the same wise heads will concede the desirability of accepting the principle that different interest rates should obtain for Government borrowing from the banking system from those rates which obtain for individual entrepreneurs seeking accommodation.

I think that if the differential interest system were instituted, much of the objection that Deputy Hickey feels to the existing system of maintaining the currency reserve would disappear. My worry about all this business is that the present system of monetary management here and in Great Britain and in other free countries, like every other human institution, is far from perfect, but it works and can be made to work much better without any radical or revolutionary upheaval in it. It has been made to work much better in Great Britain—and quietly and silently the character of the whole banking system in Great Britain has been revolutionised in the past ten years.

They have a system of social control there.

It is too late in the night to go into that now. Hitler was responsible for a good deal of it. I do not know why we need to wait for international catastrophe to drive us into doing what most reasonable men recognise as fair and equitable, but there is this danger——

Do not spoil it.

——that the rigid orthodoxy of experienced financiers, with their desire to maintain everything exactly as it was and their horror of departing from any existing institution however archaic, drives people— reasonable, moderate, but perhaps too warm-hearted people like Deputy Hickey—lepping mad. The trouble is that all of us know that fundamentally Deputy Hickey is substantially right and if he goes lepping and nobody has a real heart to spancel him and hold him back because you have the feeling that, well, he has done everything he could do to achieve these reforms by argument and reason and that nobody would listen to him. But when he goes lepping mad something begins to happen. The danger is that, in the process of lepping mad around the country, people whose heads may be as soft as their hearts may tear down a very complex and delicately-balanced piece of social machinery, confident in their capacity to substitute something much more efficient, equitable and just, only to discover that when they have torn down a very complex thing which it has taken generations to build up, it is quite beyond their capacity or that of anybody else to put something in its place.

Do not put a fear into the minds of the people.

Let us not close our eyes to the danger. The argument, in my submission, for reform is unanswerable. The argument for caution and prudence is the most urgent that could exist in any society. Hell is paved with good intentions. More people in this world have lost everything they value through the well-intentioned activities of good but simple men. They never lose their properties or homes through the activities of villains. God defend me from the well-intentioned man.

Oh dear!

That finishes you.

I would sooner try to stop a runway horse. When a well-intentioned man gets cracking, God knows what may happen. I am not talking now to the do-gooders. I am not talking now to the starry-eyed idealists who believe that human nature is perfect and only waiting for the opportunity of blooming in its perfection for the world to see. I am talking to people like myself who are very imperfect and have a very adequate appreciation of material gain.

The Deputy is talking a long time.

Yes, and I am not going to be stopped or checked by one minute.

If the Deputy puts questions there may not be time to answer them.

How much time have we left?

Half an hour.

If the Minister is rearing to get in and answer my questions I an longing to hear him.

There is only one remark that I want to make, in a personal sort of way, to Deputy Dillon and Deputy MacBride. It is that for three years they were members of a Government——

Surely the Minister is not drawing that out again?

——yet they come in here to-night and ask questions for which they could have got answers if they had had any interest in getting answers during those three years.

I hope the Minister will pass from that type of approach.

We made it our policy to repatriate sterling assets. You say that is wrong.

What the Deputy's Government did was to avoid taxing in order to avoid political unpopularity. They inflated, and the result of the inflation in this country was that the people were consuming more wealth than they were creating and drawing upon past savings, namely, the sterling assets. That practice is as old as the hills. Governments from the beginning, when they did not want to face the political unpopularity of collecting money or cutting down Government expenditure, either pulled in the coins and put out lighter coins, or pushed out some seashells, or created Government debt of some kind or another. It was not a new idea that the former Minister for Finance hit upon, when he could not get his Party to stand for collecting money they should have collected, to borrow and to spend funds like the Post Office Savings Bank's funds and the Marshall Aid funds which were under his control.

The people will recognise what went on. They have seen people having a good time in a pub, some fellow rapping and calling and then telling the bar-tender to "put it on the slate". That lasted for the three years of the Coalition Government. The Minister for Finance rapped and called and he "put it on the slate". We have to pay for it, and future generations will have to pay for it. We have to pay extra £4.3 millions a year in interest and sinking fund because of the debt created by the Coalition Government.

Deputy Dillon comes along to-night and asks why we did not get money from the banks at 1? per cent. for State purposes. The only money that was ever got from the banks here at 1? per cent. was got by myself. I created the system whereby the Government could get money by means of Exchequer bills for three months at 1? per cent. One of the first things that Deputy McGilligan did when he became Minister for Finance was to allow the banks to give State loans at 3¼ per cent. and then repay the Exchequer bills that were drawn at 1? per cent.

Deputy MacBride wants to know what moneys we have in sterling assets. He gave a lot of figures which I do not propose to contest. It is true that the Central Bank has £80,000,000 or £90,000,000 of sterling assets; that Government funds have £50,000,000 or £60,000,000; that the commercial banks have a couple of hundred millions; and I suppose other institutions and persons have probably another £100,000,000 or £200,000,000. We have gross sterling assets of probably £ 400,000,000 £500,000,000 or £600,000,000. Against that, however, we have various claims on us. The best estimates I have seen —it was made unofficially because it cannot be done officially—was made by one of the officials of the Department of Finance. That estimate was that, about 1949, we had net sterling assets of about £222,000,000. We have spent a good deal since. Therefore, our net must be very much less at the moment, nearly down to half. If we continue for the next couple of years as we have been going it will be down to nil.

I do not speak as a defender of last resort of sterling assets. Deputy Dillon was talking about the lender of last resort. We as a Government, from 1932 to 1948, often had to take decisions which might mean that our community would draw upon their savings outside the country. We got a lot of abuse from Deputy Dillon, Deputy McGilligan and others during the 30's for adopting that policy. We were told that we would be ruined because we were spending a few millions per year more than we were producing.

Deputy MacBride last night said that we should agree upon a common national economic policy; that we should have a review of the situation and see where we were going because we had not changed since 1921. That is not true. Deputy MacBride has been acting like Rip van Winkle. There was a revolutionary change in 1932 in the economic and financial outlook of the country. Before that time the Cumann na nGaedheal Party were in office. They were supported by a number of people whose attitude was that this country could only prosper if it produced goods for a single market and the type of goods wanted by that market. Any idea of substituting imports by native production was the subject of great examination. I remember that there was a proposition in the Cumann na nGaedheal time that we could at least produce our own prayer books. The then Tariff Commission sat for two years considering that and they visited half a dozen countries to see whether or not we could print our own prayer books here.

We still do.

The total involved was about £30,000. I do not know how much the Tariff Commission spent on investigating that matter. That was the mentality——

The Minister is aware——

I did not interrupt the Deputy when speaking and I have not got a very long time to speak. Whenever the local communities pushed Cumann na nGaedheal when there was a local factory closed—there were several closed down in my constituency during the Cumann na nGaedheal regime up to 1932—they took very diffident steps into the cold water of protection. They were like a two year old child at the seaside with the found father, mother, aunts and others trying to get him to take a duck in the sea and only succeeding in getting him to put in his toe. The Government at that time put their toe into the water on a few occasions but they had not the slightest idea of having a swim. They were careful about protection. The result was that nearly 1,000 factories were closed down during their regime.

Their whole attitude to economics was displayed by Deputy Mulcahy when Minister for Local Government in 1931. When he was asked to go out for a housing drive he said: "We cannot go on with any great housing development until the cost of labour and the price of materials fall to a point when we can build houses and let them at an economic rent."

When we came in we changed that whole attitude. We started off on a housing campaign and got 146,000 houses built or reconstructed during our time. We gave protection all round. We created industry as a result of which at the present time, even though we are not producing as much as we should for export in order to pay our way in the outside world, we are producing a vast amount of industrial products which are enabling our people to have as high a standard of living as practically any country on this side of the Atlantic Ocean. If we could for a number of years get our people to restrain their present consumption and put their energies into building up more capital equipment, the time might come when we would have a higher standard of living than people in other parts. It is very difficult, however, to get people to save in order to build up capital wealth.

Deputy MacBride, I am glad to say, has dropped a few of the old cliches and slogans which he used to use in connection with problems of this kind.

He did not put forward to-night or last night as the cure for all our ills that we should break the link with sterling. He did not talk too much about the fact that we were giving £150,000,000, or whatever the amount was, at ¼ per cent. to the British, but that we could not get money here under 5 per cent.

I did not emphasise every point.

I hope the Deputy may have been educated a little bit to realise that the fact that we have external assets, instead of detracting from our ability to build up our country, in fact encourages us and strengthens us in the attempt to build it up.

Deputy Dillon alluded to an understanding away back in 1939. Supposing it had been possible for the Government here in 1939, 1929 or 1949 to translate all our sterling assets and foreign assets of any kind into gold and take them back here and put them into the vaults of the Central Bank, is there anybody who would say that, because we had gold in the vaults, it detracted from our ability to produce wealth here?

That is just what we have not got. We have wasting assets.

We have the modern equivalent.

The only equivalent that is open to us.

Sterling?

Sterling.

The equivalent of gold?

Let me take one Deputy at a time. I cannot talk if everybody else is talking. I said it is the only alternative to gold that is open to us in the modern world. Deputy Dillon spent about half an hour before Christmas telling us how hard sterling was, and Deputy MacBride spent most of the time telling us how soft it was. All that I want to say is that, whether it is hard or soft, it is the only external asset that we have to enable us to buy equipment and to buy the things which we do not produce here at home and which we want to consume.

That was not so in 1939.

No, it was not so in 1939. The point that I was making, in reply to Deputy MacBride, was this, that if in 1939 or 1949, 1929 or 1919 we had translated all our external assets into gold and dumped them here, there is no one who would say that that was detracting from our ability to create credit or to promote capital development here, or that that development was stopped in any way by the fact that we had gold. As Deputy Dillon has pointed out, we spent £90,000,000 of the external assets that we had in 1939 in buying dollars to enable us to buy the things that we imported during the war. Now, you can buy dollars or buy francs with an acceptable currency or with an acceptable commodity like gold. Even at the present time, you can buy gold for sterling if you give enough of it.

Enough of it?

And if you want to buy gold for dollars you can buy gold if you give enough dollars.

You are getting a bit off the rails there.

You will have to give a few more dollars for it than the American Government would give.

And you have to break the law.

It would not be breaking the law if an Indian did it in India or an Irishman did it in Ireland.

It is against your own law.

If you have the dollars you would not be breaking the law by translating them into gold. There is one other thing I want to say in regard to the power of the Central Bank on this question of lender of last resort.

Will the Minister say now——

I would ask the Deputy to remember that I have only ten minutes to reply to all the things said here. The Central Bank has the power to control bank credit in this country if it wants to exercise it, and the Government of this country has the power to select and appoint the directors of the Central Bank. The last Government had the power to do it, and, in fact, six of the present directors are people who were appointed or reappointed by the previous Govern-ment—six out of nine.

They have no power.

The Deputy knows as much about that as he seems to know about a lot of other things. Section 50 of the Central Bank Act gives the Central Bank the power to control credit.

To contract it but not expand it.

The thing is this, that if the Deputy wants to impose his will upon me—let me put it that way—and he has a gun at my back——

The Minister knows that I would not use it.

——he can tell me either to go forward or to go back. He has the force to compel me to go forward or to go back because he has the power to impose the penalty of shooting me if I do not. The Central Bank has not the power to shoot bankers, but it has the power, if they are lending too little or lending too much, to make them cover a percentage of their deposits in the Central Bank, interest free. It has the power to compel the commercial banks to do that.

Through their loans?

The Deputy, unfortunately, knows very little, although he talks a lot about this subject. As a matter of fact, he talked here for about an hour as to his inability to get a certain bit of information from the Department of Finance when he was in office. I had to point out that an official in the Department of Finance had actually written a book about that.

I have read it. It is a most excellent book.

My only point is that Deputy Dillon spent a lot of time proclaiming and complaining that he could not, during the three years he was in office, get information from the Department of Finance which was already in published form, issued and written by an official in the Department of Finance years before he became Minister.

He was a very modest man and he would not tell me that. I bought it since.

I am glad the Deputy did.

The Minister ought to name the book now that he has given it such praise.

Deputy Dillon talked about certain powers of the lender of last resort. He said that there was no use and no necessity for a lender of last resort in this country. It is foolish for Deputy Dillon to think that the lender of last resort can only act through the intricate series of operations which come into play on the London Money Market through its bill brokers and the rest. The general function of the lender of last resort, applicable in any country in the world, is to see that if there is a run on the banks and the people want cash or legal tender they will get it. That is why that clause, to which the Deputy has alluded, is in the Central Bank Act.

It is a new definition for a lender of last resort.

It is quite an accurate one, as the Deputy will see if he looks it up. I had come as far as 1932 in dealing with Deputy MacBride's points. It was the belief of the Fianna Fáil Party right from its foundation that if we only put our backs into the work as a nation, we could utilise the resources in both brains and material which God had given us here in order to build up an ever-increasing standard of life for an increasing population. I think it is true to say that the population is to-day about the same as it was in 1932. A number have gone. That is another line of argument. About the same number of people are in the Twenty-Six Countries to-day as there were in 1932.

When we first came into office and brought in an Agricultural Wages Act there were certain districts in which farm labourers earned only 14/- a week, without keep.

Do you really believe that?

I know it to be a fact. In certain districts that is all they got. The first increase we gave, and it was thought to be quite a big advance, throughout a large part of the country was 24/- a week. The minimum now is £ 10s. od.

The average would be £3 10s. od. In some parts the wage is £4. It compares very favourably at any rate and clearly demonstrates that some advance has been made because everybody must admit that the poorest section of our workers have gone from 14/- to 70/- or 80/- a week.

Will the Minister now give us the cost of living figure?

The cost of living figure may have doubled since but wages have gone up five and six times.

£3 10s. Od. is not five and six times £1; it is three-and-a-half times.

It is five or six times 14/-.

That is ridiculous.

It is an easily verifiable fact.

Nobody got 14/- a week here since before the 1914-1918 war.

I know they were getting it in 1932.

I have a fairly considerable knowledge of conditions in rural Ireland and I never heard of a wage of 14/-.

Not since before the 1914-1918 war.

I will bring the Deputy down to Country Louth. No later than three months ago we were talking about this at a meeting there and some of the people there told me that they themselves were getting 14/- a week in 1932. It was the time of the economic war. I grant you, there was a bit of "Blue-shirtism" in it as well as farm economics.

Is this not a very edifying contribution to an economic discussion?

Deputy MacBride made a certain allegation. I would not take much notice of it were it not for the fact that he will probably deceive a number of people. He said that the banking system here was largely controlled by the British Government. That is not true. Our commercial banks are subject to the control of the Central Bank. If my memory serves me aright, I think it is Section 50 that gives the Central Bank the power to make the commercial banks put in an interest-free deposit if, in its opinion, they are not operating in the right direction. On the point raised by Deputy Dillon as to what it is right for the Government to pay the commercial banks, may I say that the commercial banks have to live. Deputy Dillon seems to think that if they are allowed to participate in Government loans, they should participate at the lowest possible rate. But they have a function in the community just as well as other privately-run businesses have. A lot can be said for leaving a private business that is doing a reasonably good job of work alone rather than nationalise it. We could, of course, if we thought fit, nationalise the banks here. If we nationalise them, the working of them may become a much more expensive job for the State. In terms of cost to the community, the work might be much more expensive than it is at present. Irrespective of what the cost might be as between running the banks by civil servants or by banking officials, there would be a very big public outery every time a loan was refused or every time a loan was granted. It would be said that loans were granted or refused purely for political reasons rather than for business reasons.

What is the Minister's opinion of the Belgian system where the two function together?

If we went to Belgium and examined the position there we might easily find that it is not so very much different from our own. Side by side with commercial banks there are institutions there for the purpose of making loans. Side by side with our commercial banks we have the Industrial Credit Corporation and the Agricultural Credit Corporation. We have institutions like the Sugar Board, indirectly a Government organisation, giving credit to the farmers for the purchase of manures, seeds and so on. If we examine the Belgian system, therefore, we may find it is not so very much different from our own. But there is a very big difference in the Belgian economy because during the last few years the Belgians have really got down to living within their means and creating a little more wealth than they actually consumed. The result is they are to-day on top of the world.

They increased production by going into deficit for two years.

We have been going into deficit also but the point is we went into deficit a little too much for our economy.

Debate adjourned.
The Dáil adjourned at 10.30 p.m. until Wednesday, 13th February, 1952. at 3 p.m.
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