Dáil Éireann díospóireacht -
Wednesday, 5 Jul 1939

Vol. 76 No. 15

Banking Commission Report and State Finances—Motion.

Mr. Dillon

I move the motion standing on the Order Paper in my name and that of Deputy General Mulcahy:—

That the Dáil is of opinion that in view of the contents of the Majority Report of the Banking Commission steps should at once be taken—

(1) to reduce the burden of direct and indirect taxation;

(2) restrict the creation of further deadweight public debt;

(3) and so order the administration of public finance and policy as to stimulate profitable production and abolish poverty within the State.

It arises, Sir, from a request made by the Taoiseach during the discussion on his Estimate that time should be afforded to him and his colleagues to prepare themselves to deal fully with the matters touched upon in the Banking Commission Report, and matters naturally arising therefrom. I understand that that preparation has been made, and that he now feels himself in a position to deal with the issues previously raised, and which we propose to raise again to-day. It may be well, in embarking on this discussion, to turn back for a moment to the statement of the Minister for Finance, as reported in the Official Reports, column 1999, volume 75, No. 16. Concluding his speech on the Budget, he said:—

"Stringent and straitened as our position is, I believe that we can endure it so long as peace is maintained. If a widespread war comes, however, our difficulties will be intensified beyond measure. I speak now only of the reaction of such a disaster upon our finances. But there I know that with a much diminished real income, we shall be called upon to shoulder vastly increased public burdens. Moreover, the problem in that regard will be aggravated by the fact that existing sources of revenue will rapidly dry up. The stamp duties are a case in point. And it will no longer be possible to get so large a part of our requirement by customs duties upon imported goods, for we may take it that our imports will be drastically cut down. We shall have to tax what we can and where we can. Taxes upon home-produced commodities will, I feel, be greatly increased; as will the standard rates of income-tax and surtax; while all the allowances which at present mitigate the full impact of these latter upon the taxpayer will be drastically reduced."

That is the Minister's own comment on seven years of Fianna Fáil administration; that is the account he rendered of his stewardship at the end of seven years of his administration and after what he described as a great victory. He announces to us here that we are in stringent and straitened circumstances and that if an event materialises, that of a European war, over which we have no control at all, our people will be launched into unprecedented hardship; there is no roost to rob and no nest egg left—it is all gone.

It is interesting to compare that account of Fianna Fáil stewardship with the account rendered by Deputy Cosgrave when he laid down office in 1932 and when he handed over to his successor the Treasury which bore the brunt of the economic war for five weary years and furnished the material with which to pour forth an immense flood of money to cushion the blows that were directed against us by Great Britain in the course of that encounter; when he had administered the country, beginning with nothing, receiving nothing to assist him but a civil war now happily a thing long past, having cast upon his shoulders the burden of repairing the ravages of that civil war, and spending the last two years of his administration defending this country against an unprecedented economic collapse which devastated the whole world. With all that burden courageously borne he handed over an Exchequer which the present Minister for Finance was glad to describe year after year as resilient, full, and ample to meet every contingency. After seven years of that exchequer under the present Minister's control, we are informed that it is empty, that we are in straitened and stringent circumstances, and that, if those whom we have no power to control should move amongst themselves, the repercussions upon this country would be disastrous, because there would be no money in the Treasury and no resources to cushion the reactions of those outside events upon our people. Contemplating that situation I felt that we had passed beyond the stage when disaster could be avoided. But I listened with encouragement to the statement made by the leader of the Opposition, Deputy Cosgrave, that, in his judgment, there was yet time in which to take the requisite measures to restore solvency to this country which the Fianna Fáil Party has put so gravely in jeopardy. That being his opinion, I believe it is an opinion worth so much that it befits us to examine the situation now and devise the means of remedying the situation with which we are confronted.

There is in the Banking Commission Report abundant material to examine the economic state of this country. There is more than one conclusion set out in that report, because I think there were two minority reports, or even three, and, whether we agree with those conclusions or whether we do not, there should be unanimity amongst us on at least one thing, and that is, that the information contained in that report is accurate, and that the facts set out can be depended upon. Leave aside for the purpose of this discussion any of the conclusions arrived at, let us try, with the facts established, to approach the problem ourselves and accept our responsibility as the elected Legislature of the country for arriving at conclusions and showing the courage to take the requisite steps to repair the damage that has been done.

The national income of this country, arrived at on a formula set out is approximately £150,000,000 per annum at the present time. Direct taxes paid by the people, either through their rates, or through the taxes which they pay to the central Government, amount at present to approximately £38,500,000. Those taxes do not include the money borrowed for expenditure. That means that we have at present a total taxation of approximately 26 per cent of our national income. In 1929-30, the total taxes amounted to about £27,000,000, and our national income then was estimated to amount to £162,000,000, which meant that our total taxes amounted to about 16¾ per cent of our national income. The percentage of our taxation as compared with our national income has gone up by about ten per cent in the last ten years.

Now that represents direct taxation. But if we are to judge of the effect of what has happened on the taxable capacity of our people, we have also to reckon with the indirect and concealed taxation which they also have to bear. Prior to 1931, when we intended to subsidise an industry or branch of agriculture, the practice was to draw the money into the Exchequer and to pay it out of the Exchequer to the persons subsidised. But a new technique was evolved by this Government. The Exchequer was short-circuited, and the subsidy was paid directly from the consumer to the producer, and no notice is taken in the annual financial statement of that burden falling upon the tax-payer. It is nevertheless there. In respect of the wheat scheme, it amounts approximately to £2,500,000 per annum; in respect of the beet sugar scheme, according to the Minister for Finance's own estimate, it amounts to about one million pounds per annum; and, taking together, the maize-meal mixture scheme, the industrial alcohol scheme, the butter scheme, and the bacon scheme, I think I underestimate it when I say, that they together impose a total burden of £1,500,000. That gives you a total burden of concealed indirect taxation of £5,000,000, and if that be added to the total of the evident direct taxation, we find our people are asked to find annually by way of taxation £43,500,000, and that represents 29 per cent of the national income.

It is interesting to remember that the national income of Great Britain is estimated approximately at £5,000,000,000 yet her Budget falls substantially short of £1,000,000,000 per annum. The people of Great Britain are required to place at the disposal of their Government about 20 per cent. of the national income, while our people are asked to produce approximately 29 per cent. It is true, and it must be borne in mind, that Great Britain is spending vast sums of borrowed money, which must be repaid some time, but it is wise to compare, as the Taoiseach is fond of comparing, the taxable capacity of our people with that of Great Britain. If I were to make a classical multiplication, it is 66 to 1. In connection with these figures I think even the Taoiseach would admit the absurdity of the calculation that he was so fond of making not so many years ago. In addition to the concealed taxation to which I have referred, there is a further immense item, which I do not think any economist has ever undertaken to assess accurately, and that is the amount our people have to pay by way of tariffs on imported goods plus— and this is the incalculable item—the increased cost of the necessaries of life that they have to purchase, which are produced behind the protection of tariffs and quotas and which are proportionately dearer than they would be if they were imported duty free. That burden has to be borne by the consuming public and must be reckoned with when considering the burdens that the people are called upon to bear in taxation of one kind or another. If we were confronted with a position in which we had a rising burden of taxation side by side with expanding production, the creation of more and more wealth year after year, while it would be necessary to watch it with every care it would not be prima facie an alarming situation but where you have rapidly-increasing taxation with no corresponding increase in the gross output of our people then you have to realise that ultimately if that continues it will destroy the productive capacity of our people and we will get into a rapid spiral decline the natural end of which is bankruptcy with all that it connotes. I admit that our Party made one grave political error in this regard. We foresaw the situation with which we are now confronted too soon. We underestimated the abysmal ignorance of the Government and its supporters. We did not realise that men could get into their position in this country without literally knowing the A.B.C. of economics and they did not learn them until they had been two or three years in office. In the earlier days seeing the orientation of their policy we said that if that continued it meant national bankruptcy and they got kudos from going around the country saying “national bankruptcy has been prophesied but we are still here.” A lot of people began to say that Fine Gael was crying “Wolf, wolf.” The trouble was that we realised all the time that if you come to the verge of the precipice no democratic Party can pull the nation back. The only chance of saving the nation then was to get them to open their eyes to the consequences of a certain policy before they were brought to the edge of the precipice— while one's hand might still be mended although very near to the edge of the precipice—but while those in the front cried back, we now hear voices from the back cry forward.

I read the amendment on the Order Paper about "The utilisation of the credit of the nation to stimulate such development and the absorption of the unemployed worker." It does not matter how you say 9d. for 4d. It is 9d. for 4d. all the time. You can trace to 9d. for 4d. a good many of the results that have led many nations to destruction. When sections of our people with the best intentions begin to clamour for 9d. for 4d. it is because they have been brought to a situation where financial stringency has become unbearable, and looking around for some escape from the circumstances in which they find themselves and the stringency which the Minister admits they turn naturally to the plainest way and that is some form of jugglery which will provide 9d. for 4d. for everybody. I see a situation here in which saving has been put an end to by the burdens of taxation placed on our people. Saving not only means putting money into banks, saving means replacement, saving means repair, saving means restoration to the soil of the fertility the crops take out of it. It means maintaining farm buildings, fences, the re-investment of part of every year's earnings in capital replacement or enterprise. What is happening in this country? None of these replacements is provided for. We are spending all we are earning and more and it is interesting in that connection to bear in mind the statements of managers of joint stock banks in this country who express concern that in the rural branches the small farmers' deposits are being steadily depleted by individuals who are taking the money out of the banks to pay current expenditure. They are living on savings, and when those are gone their standard of living is going down and sinking to a lower standard than they enjoyed heretofore. I say now that the time has passed for covering up the dangers that confront us. It is not a responsible reply to say that any criticism of our economic activities is calculated to shake the credit of the country. The only injury that can now be done to the credit of the country is failure on the part of those responsible to face facts. It is an idle dream to imagine that those whose judgments are influenced by their estimate of our credit have their minds made up for them by what is said in Dáil Eireann. They make their own estimates and their own calculations and have at their disposal all the information we have got. If they see our country going wrong economically and becoming a bad risk then our credit is destroyed, but if they see us hitting a bad patch and directly taking the requisite measures to restore solvency and to get back on the right road, then, even though we are at the moment insolvent, we have the prospect before us of returning solvency with our credit unimpaired and such accommodation as we require to overcome the difficulties that confront us will be readily forthcoming.

It is plain to the observant that unless we correct the adverse trade balance and correct it soon we are going to have a crash. All the indications are there. We have never retained any gold in our central banks. But the same barometer is available because our joint stock banks have held external assets and by a process of calculation we can determine the net external assets. They were £72,000,000 in 1934, after American money had gone back to America, in 1935 they were £71,000,000; in 1936, £72,000,000 and remained fairly stable over that period. In 1937, they were £67,000,000 having fallen by £5,000,000 and in 1938 they were £61,000,000 a catastrophic fall. It must be borne in mind that part of that catastrophic fall was due to the determined policy of the Oireachtas to settle the difference with England by the transfer of a capital sum of £10,000,000 to Great Britain and that must be reflected in the external assets of the banks. But they have been steadily dwindling, and they are steadily dwindling, and they show no signs of coming back.

This has to be borne in mind, that were our holdings in gold they would be substantially sterile, but when we hold our resources in the form of securities in Great Britain or elsewhere, they are not only reserves on which to build credit, but they are also a valuable invisible export inasmuch as we draw dividends on them. The man who loses gold, while his economic position may be affected, his income will be unimpaired; the man who loses income-paying securities, not only finds his economic position impaired, but his income is reduced and the position of the trade balance is further aggravated. With the disappearance of every £1,000,000, our problem with regard to the balance of trade becomes more complicated.

What are the items of our invisible exports? They are, first of all, the interest on investments of the joint stock banks. Secondly, we have the remittances from emigrants. Thirdly, we have the income from the sweep stakes. Then we have the pensions payable to our people by the British Government and the income from the tourist traffic. The interest on our external investments decreases as we lose the investments. Emigrants' remittances have tended to decrease since our people ceased going to America. It is to-day thought that with the immense wave of migration that has been passing over to England in the last three years, there will come back some remittances from that source, but they will bear little or no relation to the sums that originally came from America. If the English migration is a temporary feature of our national life, that source of revenue will completely dry up in a short time.

We had recently introduced a sweepstakes Bill to guarantee the promoters of the sweepstakes against the danger of a complete collapse arising out of some international event over which we have no control. It is a fair indication of the amount of reliance we can place on the sweepstakes in the form of invisible exports. British pensions to people in this country are dwindling as these pensioners grow old and die, and that source of revenue cannot be replaced. The tourist traffic could be developed, and no doubt steps are being taken in that direction, but notwithstanding the eloquence of correspondents in the Irish Times and elsewhere, I still believe that if our latter-day patriots are going to plaster the walls of this country with “damn your concessions, England” and “to hell with Great Britain,” the tourist traffic will not continue to yield any valuable dividends for this country. If that is the kind of patriotism which we are to encourage, and if we are to keep throwing bombs in order to blow the eyes out of children in the streets of London, then I think we will have to pay for that patriotism and those people engaged in that work should have realised that before they embarked upon it.

We have seen foreign companies establishing themselves in this country during the last seven years. In so far as they draw profits from this country by way of dividends, that has to be regarded as an item of invisible imports. We have also to bear in mind that a great many old people who owned land here and sold it to the Government retained their stocks and dwelt here amongst us. But they have sent their children abroad and those children are now living in Great Britain or elsewhere. As the old people die, the ownership of their property will be transferred to people who live abroad with the result that what was an invisible export will, by that transfer, become an invisible import, thus doubling the severity of the impact upon us.

If we cannot control these items of invisible trade, there is nothing left to us but to control our visible trade and redress the balance there. To do that our only hope is to get a larger share of the British market on terms which will enable those who produce here to make a profit. I wish Deputies would bear this in mind, that the primary producers here in this country do not want big prices. What they want is big profits. If they can produce cheaply, they are quite prepared to sell competitively in any market in the world. Big prices are no concern of the producers, provided there is a constant difference between the price at which they sell and the cost of production.

We have in Great Britain a market which all the people of this State, working three eight-hour shifts per day for 365 days in the year, could not attempt to fill. We have there, happily for us, a Government which is friendly and which, for its own tactical reasons, would be very glad to draw from this country a very substantial part of its total food supply. There is no limit to the proportion of the food market in Great Britain that we could get if we were prepared to supply it constantly. But we cannot dump stuff in the summer months and dry up in the winter months. We are confronted with the astonishing situation that the British Government, having asked us to name our quota of bacon and pig products—the thing which was primarily associated with the agricultural industry—and we ourselves having named the amount which we believed we ought to be able to deliver, we find ourselves unable to fill our quota and telling Great Britain to go to our competitors and get it from them.

The fact is that we find ourselves to-day obliged to import pigs from Northern Ireland and unable to deliver to Great Britain the bacon we undertook to supply at a profitable price. That is because the Government destroyed the pig industry during the last three years. We have the unprecedented situation that this country, one of the greatest of live-stock producers, is to-day importing fat cattle from Belfast. Fat cattle have been brought from Belfast and sold in the Dublin market because we had not fat cattle to put on sale.

We have seen the export of eggs reduced from over £2,000,000 per annum to £700,000. Why was that? Because the Government over there, by their reckless disregard of the elements of agricultural economy, destroyed one branch after another of our industry and substituted what? Beet, wheat and peat. Beet has gone up the spout, peat has gone up the spout, and wheat has imposed on our people an annual burden of £2,500,000. The only people who ever got money out of wheat were the millers. They fattened on it and that is one glorious example of what the Government have done for the plain people. It is certainly the plainest Government that ever a plain people put into office.

Let us consider our debt position. A lot of Deputies here are only too fond of welcoming the creation of public debt and then forgetting all about it. But you cannot do that. Some day, somehow, you have to meet that debt and pay it, and in the meantime you have to pay interest on it. That is a very substantial item in our annual bill. Our gross debt, due in 1937, was £73,000,000. Since that, I estimate that, with the transfer of £10,000,000 which we borrowed to give to Great Britain, it must be in the neighbourhood of £85,000,000. Now, in 1924, our gross debt was £14,000,000, and we have increased it by £60,000,000 in the last 15 years. Now, gross debt is one thing, but the vital figure is that of net debt. The net debt figure, however, is extremely difficult to ascertain. In order to arrive at the amount of our net public debt we have got to subtract from the gross debt, which is readily ascertainable, the value of the assets we hold against it. What is the value of the assets we hold against it? Some of the assets which are used for the purpose of showing in the finance returns that our net debt position is only £37,000,000 are shares in the Industrial Trust Corporation. No sane man would take them if they were given away with a pound of tea. They are not worth the paper on which they are written—an underwriting establishment with a capital of £5,000,000, which, I think, of all the issues, succeeded in getting only two of them taken up, and as to the remainder of them there were large lumps left upon their hands and they are now functioning not as——

Mr. MacEntee

The Deputy is eloquent, but he is not accurate.

Mr. Dillon

The Deputy has got a list here. Since the Minister is so blunt, I may tell him that I remember once asking him which ones were left upon his hands, and I do not think he was so anxious on that occasion to go into details, any more than he is anxious to go into them now. I have got that letter still. Will the Minister let me read it now?

Mr. MacEntee

That is a matter for the Chair.

Mr. Dillon

Does the Minister want the Deputy to go into details? If the Deputy does not talk in detail it is because he was asked not to do so.

Mr. MacEntee

The Deputy has been detailed when he said that there were only two issues in this country taken up.

Mr. Dillon

I said that there were two, but the vast majority of them were left on the hands of the Industrial Trust Corporation and are still there in their portfolio, and what they are worth is very problematical. However, I shall leave it at that, except to say that if its function were that of a real underwriting institution its capital would not be £5,000,000, as the Minister himself knows. It is a holding company which has been used for the purpose of helping crocks of all sorts, as the Minister knows. I shall not go into further detail unless the Minister wants me to go into all the details.

Mr. Davin

The Deputy is making a statement which is damaging to the credit of the country.

Mr. Dillon

What I have said is true, and everybody here knows that it is true, and I suggest that if Deputy Davin were to devote ten minutes to study of the economic situation in this country, under some informed guidance, he would find that most of what I am stating, as well as being true, is an actual understatement of the facts.

Mr. Davin

That is the Majority Report.

Mr. Dillon

Ah, the Deputy refers to the Majority Report. In addition, however, to that net debt position, we have to bear in mind also that we are building up the debt. In a moment of enthusiasm, we passed the Land Act of 1933, and that means that for every acre of land we divide in this country hereafter the State accepts responsibility for one-half of its total value, and that is an annual charge to-day of between £600,000 and £700,000 and it is going to grow and to grow steadily. We have resolved to transfer the migrants from the West of Ireland to the Midlands. That is the policy determined on by this House, and it is an immensely expensive operation because every single transfer involves the creation of a substantial block of deadweight. In addition, we have growing up from day to day the contingent liability for the pensions of our public servants, both in the local services and in the national services. Every public servant, who is at present drawing a salary, sooner or later will go out on pension, with the exception of those who die in office, and a time will eventually arise when, for a considerable proportion of people in public office, we will be paying a person as an active official and as a pensioner as well. The same, of course, I admit, is true of every other country, but here we are making no actuarial calculation or provision to meet that contingency, and that will create an annual charge which, as I say, is not peculiar to this country, but which is essential to the public services. What we have to bear in mind is that, in time, that is going to add to the annual charges which are fixed charges on the finances of this State and which, so far as they are, correspond to the fixed charges of a deadweight debt.

We have, in addition, the commitments to which I have referred, such as the contingent liabilities of the Government guarantees, and I believe that in 1937 they amounted, in all, to £2,308,000. Now, if we are going to get profitable production in this country, it has got to be profitable agricultural production because, with our system of tariffs and quotas and increased costs of industrial production, the prospect of our developing an outside market for our industrial products is remote in the extreme. Therefore, our first duty, if we are to carry out the purpose of this resolution, is to stimulate profitable agricultural production, and I submit to the House that, in order to bring that about, the first thing we have to do is to reduce the cost of the raw materials. Mind you, we are not dealing with a position or situation in which we can afford to hesitate in taking the necessary steps, because crisis is upon us. I believe that the Minister for Finance knows that as well as I do. Our only hope of converting the disaster which that crisis presages is to create upon the public mind an indelible impression that we have taken and are taking the requisite steps to meet the situation and that, given time, we will surmount our present difficulties. The first and essential step to take in order to create that conviction in the minds of our neighbours and of our people is to restore profitable production and extend it, and if we are to do that we must reduce the costs of our raw materials, because we have to sell our produce in a foreign market and have to come into competition there, in a greater or lesser degree, with world prices. If we are to make a profit on that market we must bring the costs of our production below the prices we are going to take when we come to sell our produce. In order to do that, we must reduce the costs of our feeding stuffs, of our manures, of our farm machinery and of our farm implements. We should reduce the cost of every item that the farmer brings on to his land. We should reduce the cost of seeds and every other item that the farmer brings on to his land with the purpose of converting that item into the finished product which he intends to sell. There is no escape from that, and the longer you defer facing that situation, the less resiliency will there be in the power of recovery, because if we go on as we have been going for another year or two you will have so far crippled the farmer that he will not have the resources left to enable him to avail of the advantages put before him by the British market, and if he once lets somebody else take that market away from us it may take a generation to get back that market that is there for the taking now.

Secondly, we must do our best to bring home to our people the necessity for using the most efficient methods of agricultural science, and we should do that by providing adequate agricultural education in the primary and technical schools. In our madness, we have absolutely wiped agriculture out of the primary schools altogether, and in the technical schools it is pushed to one side in order to teach people to become typists and shorthand writers—functions for which they have no more capacity than the babe unborn. Instead of that, let us concentrate our energies on giving to those whose purpose it is to reside in rural Ireland as good an education in agriculture as possible. It is up to the Government to provide facilities for marketing and to help the people in the matter of providing suitable housing for their live stock, as well as in the provision of cheap feeding stuffs, so that the live stock will not have to suffer in the future, as they have in the past, from bad and unhealthy housing accommodation because the farmers either had not the means or the knowledge as to how best to design proper housing. These two things at any rate, should be provided for first. Then, in addition to those two things, I think that we require two others and one is the derating of land. I do not believe Sir, that it is expedient for me on this occasion to go into the matter at great length, but I believe that it is a vital part of the reconstruction of agriculture in this country. Lastly, I believe that it is required that we should provide credit for the farmers. Here again, that is a matter that might be elaborated at great length. But I think that those who are concerned in that matter need not worry too much since means have been found to deal with it "within the system," to use the Minister's words, and it was fully elaborated recently in the Seanad by Senator Counihan and, in greater detail by, I think, Senator Johnston, and any Deputy can turn to that scheme for a solution of this particular problem.

It is an ingenious, a sound and an effective method of bringing credit to the farmers of this country, one that could be done without shaking the economic foundations of the State, and at the same time without giving rise to any credit contingent liability. If we do that, then I think we begin to make money. I think if we begin to make money, and if we restore profit to our main industry in this country, we are off on the right road.

Now, this resolution that I have put before the House does not end with a reference to taxation and debt. The last paragraph contains perhaps the most important part of the matter which we wish to bring before the House. I have spoken of the stimulation of profitable production, because in order to achieve the last purpose that we have in mind an expanding national income is vital. Poverty and destitution will destroy us and the democratic things that we believe in if we do not destroy proverty and destitution themselves. Now, I do not want to pretend that our Party is in any superior position to any other Party in this House in regard to its solicitude for the poor, the hungry and the destitute in this country, but there is the danger that as we approach middle age we are comfortable—the worst of us has £480 a year—and we begin to think that it is very sad that the poor are poor; very sad that our neighbours are hungry; we are glad to do anything we can to help them, but we content ourselves by saying, "But, sure what can you do?" I do not profess to be in the least bit more softhearted than anybody else. I am thinking of myself. I like the system of government under which we live. I like individual liberty; I like democracy; I like all those things with which the Commonwealth of Nations is associated and stands for in the world; but, I do not believe in those things which suffer the continuance of a situation in which you have on the one hand rich people and on the other hand the hungry.

Now, I have waited and listened to a variety of schemes being propounded, none of which appears to me capable of working, so that I am asking the House if it will not now consider facing this problem and tackling it. I do not believe in waiting until you arrive on the touchstone which will solve all your difficulties, because if you wait for that you will wait for ever. I believe in facing the difficulties, and reconciling yourself to the fact that Joshua had to march around the walls of Jericho seven times before he brought them down: in making up your mind that you will get around the walls of your particular Jericho once before you die, and hope that those who come after will make the subsequent six necessary circuits.

The first and greatest evil in this problem of poverty, as I see it, is the evil of the man who is married and has a family of children, whose poverty means to him not so much that he must suffer himself in his own person, but that night after night and day after day he has got to look at his children go hungry to school and hungry to bed. That is a condition which I do not think we should tolerate any longer. I believe that to remedy it, admitting that it is not going to solve the entire problem of poverty, we should resolve that a first charge on the national income of this State would be the provision, for every person, whose income fell below a level to be agreed by the State, of a weekly allowance in respect of each child, so that at least that family will be guaranteed against the agony of knowing that its members suffered from literal want.

Now, I do not approach this question from any vague or blousey humanitarianism. That is too easy. There is no use contemplating a plan of this kind unless it can be paid for out of annual revenue, and any person who imagines that a reform of this kind can be profitably initiated, to be financed annually out of borrowed money, would, far from helping those whom he sought to succour, inflict upon them the cruellest injury he conceivably could. Therefore, I cannot emphasise too strongly that indissolubly bound up with this conception is the hope of an expanding income. Without an expanding income no justice of the kind I here outline can be done, but the injustice and the cruel wickedness of leaving any of our people hungry, and families unprovided for, must continue.

This plan arises—the necessity for it arises because there are those who may say: "Why should you do this now?"—from the most interesting social change that has taken place since the introduction of the industrial era in the world. May I trespass on the House to read for them an extract from the journal of Daniel Defoe? Describing the conditions, as he saw them in England before the advent of the industrial age there, he says:—

"When children worked alongside their parents, first in the fields and in their own homes, the old saying that `with every mouth is born a pair of hands' had some meaning... Within the houses we saw women and children carding and spinning, all employed from the youngest to the oldest, scarce anything above the age of four years old, but its hands were sufficient for its own support."

That day is passed. The works that used to be done on the hearth and in the home are now done in the factory. The wage-earner of the family brings home the money to purchase those things that used to be made at home. The children now are required to get their sustenance through the wage paid to their father for his work as head of the family. But there is this difficulty: that you have a situation in which the wage, however it is fixed, is going to be the same for the man with ten children as for the man with no children at all: that whereas the man with no children may be living at a modest level, the effort of the man with ten children to live is really desperate. The fact is that when a man marries, every child with which that marriage is blessed becomes a very menace to his survival: every child which comes into that house, which should be a blessing, is, in fact, a threat to his means of subsistence and a burden on the minimum ration of the children that are already there. For that situation there has been suggested the remedy of the family wage, but the family wage works in this inequitable way, that, if you fix an arbitrary figure for the wage which should be adequate to meet the requirements of a man and his wife and three children, when the day comes that one wage earner has one child and another has ten you find that the wages which ought to be going to the support of the ten children are in fact going into the house where there is only one.

The family allowance surmounts all that, and I suggest that it should be operated on lines analogous to those on which it operates elsewhere. I can conceive it is possible that one should arrive at a basic wage of say 27/-, a week, which is the fixed wage in agriculture in this country, and provide that any person with an income less than that should receive 5/- a week in respect of each child; that the allowance should be paid to the child's mother, so that the mother would feel it a special duty upon her to spend it in the service of the children for whose maintenance and care she is primarily responsible; that when the family income went up by 3/- to 30/- the weekly allowance should be 4/-, and so on, so that at 33/- the allowance would be 3/-, at 36/- the allowance would be 2/-, and at 39/- the allowance would be 1/-, and above that no allowance at all, bearing in mind that the man who pays income-tax is entitled to turn to the State and ask, in respect of children, for a remission of the tax due by him. I cannot see how any equitable argument can be advanced for refusing those who have not even sufficient income to require them to pay income-tax at all if they ask for some allowance for the children they have, pointing to those who are enjoying a comparatively adequate income and saying: "They are getting some allowance for children who are very much better off."

I think this plan would have the additional advantage of simplifying the administration of the social services, and ensuring that a greater proportion of the money required for the relief of familial difficulties would find its way to the family instead of to the civil servants who administer those schemes. I believe that the American plan at present being operated in Massachussetts might be incorporated in this with a view to consuming primarily the products of our own land. I believe in fact that it would go a very long way to abolish the worst evils of poverty in this country. I am convinced that it would be practicable and good, provided we had the money to pay for it. There is only one way to get that money, and that is to earn it. There is only one way to earn it, and that is to afford our people the chance to do so, and that matter is very largely in the hands of the Government.

On the one hand, we have the prospect of inflation, uncontrolled, which at first will be extremely pleasant for the people in this country. Its first impact will be one of relief from strain, expanding wealth and greater comfort for everybody. It will provide just that kind of relief which Deputy Davin has in mind when he speaks of using the national credit to absorb the unemployed and to stimulate the development of the nation, but it has as its logical end for this country disgrace abounding, shame and confusion for all of our people scattered all over the world who have held their heads up, and who have boasted of their Irish extraction, in the confident belief that when the Irish people got control of this country they would show the world an example of how a Christian country should be run. It will mean inevitably the loss of this country's independence. We have object lessons of that before us. We have seen Newfoundland travel that road, and end in London with a request for British Treasury officials to come and take from them their sovereign independence and run the country as delegates of the British Treasury. We have seen the Government of New Zealand—and we have got to face it—send to their Envoy to London to seek the cash to meet the liabilities of that Government.

Mr. Davin

Of its predecessors.

Mr. Dillon

We have seen the Government of New Zealand meet the consequences of the crazy schemes that are bewildering some of our people in this country at the present time. And unless we open our eyes and learn a lesson from the fate that has overtaken them the day will dawn when it will be brought sharply home to us. The fundamental difference between Ireland and New Zealand is that New Zealand is the daughter of an older country and may return to the country that begot her for help in her tribulation. This country is one of the oldest in Europe and can turn to no one as a mother. We stand upon our own or we betray all the generations that went before us. I say deliberately that the man who sold this country to Great Britain in its darkest hour of need never betrayed it so grossly as those who would use our own powers of government to destroy us and deliver us into the hands of Great Britain as a bankrupt to be done with as she pleases. Nobody knows better than the Minister for Finance that that is the fate which awaits us. I do not want to go with my hat in my hand begging alms of England or any other country.

Mr. Davin

You will never be asked.

Mr. Dillon

If this plan which peeps out of all the Labour Party utterances of the last 12 months should ever come to pass, they will not go to London but they will ask others to go for them.

Mr. Hickey

You are making a good case for the Bank of England.

Mr. Dillon

I am making a good case for the solvency of this country, and I am making a good case for the thesis propounded by those who fought to make this country free, that when we got control of it we would know how to run it. There are elements growing up in this country, and that Minister was responsible for calling them into existence, who would make a public fool of us before the whole world and who would deliver us into the hands of our enemies in a humiliation unprecedented in the history of this country. We have never struck our flag. We have been defeated again and again but always honourably, and have never had to beg alms at the table of any person, enemy or friend of this country.

Mr. Davin

What caused the famine?

Mr. Dillon

Folly such as that for which Deputy Davin stands at the present time would cause another. Lastly, let us bear this in mind, and I invite the Labour Party to dwell on it: the people who will suffer if this should come to pass are not the rich, not those whose wealth is sufficient to permit the transfer of themselves and their wealth abroad; they could go overnight. The people who will suffer are those who are bound to this country by the fact that they cannot get a living anywhere else. The small man whose all is invested here, the small man whose wife and family are dependent on the wages he earns here—it is on them that the burden of this will fall, and it is for them that those of us who are trying to prevent the catastrophe are fighting at the present moment. On the other hand, there is the blunt, unromantic, honest way of paying 20/- in the £; the old healthy instinct of the man who does not want 9d. for 4d., the man whose avarice is never stirred by the thimble and the pea, and the man who is, therefore, never disappointed. That way is the way in which we can maintain our independence. We may be poor together; we may have hard times together, but we can face anybody, and those who would interfere with the gilded or the mailed fist can be sent about their business now as they have been in the past. We can secure for our people, if we go the right way about it, a higher standard of living than any other agricultural country in the world can supply. We can provide for all our people a fuller life. Albeit there will not be in this country great riches, there should not be dire poverty either. We have the means of getting for all our people that which it seems to me a Christian philosophy would demand, and that is a modest standard of comfort for us all, with no surplus for anybody until the primary essentials are secured for all. And lastly, something that is as dear as anything else to me, we can by that method vindicate all those to whom I have referred, not only those who held their heads high the world over because they were Irish, but those who are gone, those who fought to make this country what it is now, sovereign and independent, unified, as we hope to see it some day; those who fought to make this country free, not only in 1916, but before that, too; those who were in the fight to make this country free and staked their reputation that the Irish people, and none others but the Irish people, knew how to run this country as it should be run. Their reputations, all that they did and all that they sacrificed for this country, are in our hands. We can throw it all away; we can betray them as no other generation ever betrayed them; or we can prove to the world that they were right, and that those who defamed and denounced this country, who wished it ill, were wrong and were confounded.

I look to the Government now for that co-operation in meeting the situation with which we are now confronted that we have the right to demand, and I say that we are quite prepared to waive all inquiry into the circumstances that brought us whither we are. We have no desire for further recrimination. We are anxious to save our common country. We appreciate that steps may be requisite now which are difficult for a democratic Government to put in hand. Let this democracy show that the interests of the nation will not be sacrificed for the passing political advantage of any individual Party. Let it be the duty of every Deputy in this House to tell the Government that if they are prepared to do what is right for Ireland now they will suffer no political injury thereby; that, in so far as they are prepared to organise the resources of the State for its protection, no matter what political Party happens to be the Government of the day, all sections of this democratic assembly will co-operate with them to avoid a catastrophe which must substitute for popular government the government of one dictator. We can lose our liberty to a foreigner or to an ambitious individual at home. Democracies have been jeered at by dictators all over Europe that they are unequipped, unable, and too weak to deal with crises. Can we show Europe that in this comparatively poor and, in the eyes of some, insignificant, democracy we can demonstrate our ability to meet this crisis, which is as grave as any could be, with the resolution requisite to surmount it and preserve our liberties when other countries might have lost them? If we do, we pay tribute to the memory of those who fought to give us the power we have now, more valuable than any other we could devise, more valuable than words or monuments. We will have shown them and their enemies that they were right and that their enemies were wrong; and that, far from being the least of democracies in the world, by the spirit with which we meet this situation, we are capable in this generation, as we have been in the past, to show those who love liberty the way to preserve it.

General Mulcahy

I beg formally to second the motion.

Mr. Norton

I beg to move the amendment standing in my name and the names of Deputy Keyes and Davin:—

To delete all the words after "that" where it first occurs and substitute:—

"in view of the serious depression in agriculture, the existence of widespread unemployment and the impoverished condition of large masses of the people as disclosed in the reports of the Banking Commission, Dáil Eireann requests the Government to submit to the Dáil at once proposals for the better development of agriculture and industry, the utilisation of the credit of the nation to stimulate such development and the absorption of the unemployed workers in productive employment at adequate rates of wages."

I do so because I do not think that the economic salvation of this country will be achieved by the adoption of the policy set out in the motion before the House. After all, notwithstanding Deputy Dillon's lyrical speech on the future of Ireland, and his pretended desire to safeguard democracy here, the motion which he has offered to the House this evening is a motion which bankers in this country and Great Britain would vote for if they had seats and votes in this House. The motion which Deputy Dillon offers to the House is a banker's motion. It is a motion which will beget the support of everybody who lives on rent, interest and profit. It is a motion which will be supported by super-taxpayers, will be supported by the wealthy classes in the country. Deputy Dillon is, apparently, satisfied that the economic interests of this country are adequately safeguarded if he can evolve or enthrone here a system of public finance and a system of government which will protect the interests of the wealthy few and leave the masses of the people of this country in a condition of impoverishment. Deputy Dillon, of course, will attempt to disavow any such intention on his part. But the terms of the motion indicate clearly that it is a rich man's motion and that its sole purpose is to depress the standard of living of the plain people of the country by restricting, in the very positive way which his motion indicates, very valuable agencies of social expenditure at present administered by the State.

I do not think that the road of this country's salvation lies in that direction. I think that what this country needs to-day is not a curtailment of expenditure in the manner indicated by Deputy Dillon, either in his motion or in his speech; I think what we need to-day is to think deeply, to plan carefully, and to mobilise all our resources of the State in the interests, not of the few people for whom Deputy Dillon spoke this evening, but in the interests of the mass of the people of the country. Our amendment is submitted, not with the desire to encourage the Government to embark upon a policy of retrenchment, or a policy of economy in respect of certain types of expenditure which must inevitably press with vigour and rigour on the masses of the people, but to encourage the Government to take the line of organising comprehensively all the resources of the nation and using those in the interests especially of those sections of the community who are least endowed with this world's goods.

I acknowledge at once, and it is possibly the only point of agreement between Deputy Dillon and myself, that there is a very serious economic position in this country to-day. I acknowledge that the position could scarcely be more serious. In my view, the gravity of the whole situation is more clearly portrayed when one tries to ascertain the proposals of the Government for remedying the situation. I think the Government have no proposals whatever for dealing with the serious situation confronting the country to-day. It is because we want to encourage the Government to get out on that broad high road of organising the nation in the interests of its people, and for the purpose of assisting in a mobilisation of the country's resources, that we have submitted the amendment to the motion to-day.

Any consideration of this motion necessarily involves a survey of the economic position as we see it to-day. What does a survey of that position disclose? According to statistics issued by the Government, there were on the 13th February last 105,000 unemployed persons within the country.

A few weeks previously we were informed by the Government that 38,000 persons were employed on the notorious rotational schemes, which gave them employment at appallingly low rates of wages for three or four days weekly, and since they were only employed for a very short period, a substantial percentage of that number must be added to the unemployed list. When we come, therefore, to ascertain the extent of unemployment in the months for the which examination is possible, it will reveal a fair criterion of the position and, I think, we must come to the conclusion that in a small State, with less than 3,000,000 people, we have approximately from 120,000 to 130,000 unemployed people. If we examine the statistics for home assistance, it will be found that there are 80,000 persons dependent upon the miserable scale of relief which they get under our Poor Law Acts. These two figures indicate that in respect of a small country, the economic position is so serious, that it is no exaggeration to say that catastrophe is likely to follow from failure to face up to it. The economic survey cannot end there. In the ten years from 1926 to 1936, and with greater acceleration in the latter years of that decade, we have exported to Great Britain and other countries, according to the official statistics, not less than 166,000 of our people. In the years 1936-1937 and 1937-38 the population dropped by not less than 30,000 people. Is a situation of that kind one which the Government can look upon with complacence? Is a situation of that kind one which the Government can expect the country to feel satisfied about? Is that representative of the Fianna Fáil policy? Is it the best that this Government can offer after seven years of office?

To-day we are in the position that in a relatively underdeveloped country we have from 120,000 to 130,000 unemployed people, 80,000 existing on destitution rates of existence provided under the Poor Law Acts, and 30,000 who emigrate each year. We have now the unenviable distinction of being the one white country in the world that is losing its population. Passing from statistics so vital as those I have quoted, to statistics in respect to the marriage rate, we find that while every country regards an increase in the marriage rate as something which ensures the continued virility of the nation, here apparently we are satisfied at having almost the lowest marriage rate of any white country. I put it to the Government that in a situation of that kind, there is an obvious responsibility on them, and that responsibility is one of mobilising on their side—and they will have the goodwill of every patriotic Irishman and woman—all the resources of the nation in order to correct what can only mean in the long run the impoverishment of the country and the annihilation of the Celt.

Let us survey our main source of productivity and examine both the agricultural and the industrial positions. In agriculture we have a depression that is probably unequalled in any period during the past 50 years. In a period of rising prices agricultural workers are expected to maintain themselves, their wives and children at the appallingly low wage of 27/- a week. If we survey some of the new sources of agriculture productivity, we find a position which can scarcely afford any comfort. In the beet industry, which has been vaunted as one of the achievements of recent years there is a very heavy fall in the acreage. What is still more serious we find a tendency for the acreage to fall still further because of the difficulties of managing the beet crop, and the low price farmers receive for the result of their laborious toil. If we look at an industry which was always associated with this country—pig production —we find that it has fallen so catastrophically, as to give grounds even for fear that we will not be able to continue to maintain what we once had, and that is our excellent position in the British market for pigs and pig products.

If we turn to another phase of our agricultural productivity, wheat, even the most optimistic will not find grounds for satisfaction in the position. At the outset we have to recognise that the growing of wheat exacts an enormous toll from the land, and enormously reduces its fertility, unless we are prepared as a counterbalance to provide farmers with fertilisers and manures capable of undoing the havoc which the production of wheat inevitably causes. After multiplying the advantages of the wheat scheme, nevertheless, we get a position where the growing of wheat affects only a very small number of farmers to such an extent as to make any impression on their agricultural economy and on their budget relationship. Let us go further and look at the grass lands. I am not one of those who regards grass as the enemy of the Irish people. I think there is considerable national advantage in grass. There are many countries which would be glad to have the fattening properties of our grass land. If we recognise that some grass land is incapable of being used for tillage, but must be used for the production of livestock, we find a position which affords no room for comfort. In Kildare, one of the finest fattening counties in Ireland, in which a very substantial proportion of fat stock is fattened and exported, we find a position in which the lands are under-stocked or without stock. While nature has given all the qualities necessary to fatten stock for export, the farmers are unable to finance a scheme of live-stock, production, or to fatten livestock, because of the complete absence of credit facilities.

I am sure we will be told that the Agricultural Credit Corporation exists for the purpose of supplying thrifty farmers with all the facilities they need. Anybody with any experience of the Agricultural Credit Corporation knows perfectly well that the Agricultural Credit Corporation would lend a farmer money as soon as a stranger that a farmer might meet in the street would lend it to him. Before money can be got from the Agricultural Credit Corporation a farmer must satisfy it that he does not owe any land annuities, that his rates are paid, that he has no shop debts, and that generally he is a thrifty, progressive farmer. If a farmer is in that position he would not look for money from the Agricultural Credit Corporation at 5 per cent. These are the only circumstances under which money can be got from that corporation. The utility of the financial schemes of the Agricultural Credit Corporation in that respect was still-born. Its utility to assist farmers has been negligible. No farmer believes that it offers him the slightest hope, either to restock his land or to finance any agricultural activities he might have in mind. Where can the farmer get money to-day? Nobody will attempt to say he can get it at the bank. A burglar is as welcome in a bank as a farmer, because it is impossible for the farmer to get money from any of the joint stock banks that function in this country to-day.

Let us pass on from that to our industrial position. Let us survey that for a few moments in order to ascertain the position. One of the outstanding developments of our efforts to stimulate our industrial production during the past 12 months has been the effect on our efforts of the London Agreement. Whatever may be said about the financial clauses of the London Agreement, the industrial clauses were disastrous from the standpoint of this country. Every British manufacturer, whether he is in Whitechapel or Manchester, whether he is on the Clyde or in Birmingham, can now make an application to the Prices Commission here for a review of the tariffs we imposed for the purpose of protecting our industries, and two or three members of the Prices Commission, with no responsibility to this Parliament, with no responsibility to the people of this country, unfortified by a single vote of any Irish citizen, are in a position to-day, under our legislation, to accede to the request of the Whitechapel or the Manchester manufacturers, and that may be done in such a way as to depress our tariffs in the interests of a British firm which wants to continue its stranglehold on the Irish market. Is it any wonder, therefore, that in circumstances such as these, Irish manufacturers have felt that their future industrial position was indeed grave when a British manufacturer, with the permission of this Parliament, can present a case to an Irish Prices Commission and have as good a standing there as if the person were an Irish citizen or an Irish manufacturer employing Irish people?

The Minister for Industry and Commerce is one of the Ministers who frequently attend banquets given by the Federation of Irish Industries and, generally, he attends banquets given by employers in this country. One can understand the kind of delicacy and courtesy that must obtain where a Minister is an honoured guest at an employers' function; but not all the courtesy nor all the delicacy can apparently prevent the Minister's hosts from saying that they were gravely concerned with the position of industry in this country as a result of the London Agreement.

Mr. MacEntee

How does the London Agreement come to be relevant?

An Ceann Comhairle

No point of order has been raised.

Mr. MacEntee

I put it——

Mr. Norton

Is this a point of order, or merely a growl?

Mr. MacEntee

Is that in order?

An Ceann Comhairle

It is not.

Mr. MacEntee

I am putting a point of order and Deputy Norton, I notice, is standing.

General Mulcahy

You have not made much attempt to put it yet.

Mr. Norton

I am anxious to hear the point of order.

Mr. MacEntee

This amendment purports to deal with certain things disclosed in the reports of the Banking Commission. Deputy Norton has been discussing the operations of the Prices Commission and of the London Agreement, as it is popularly called, for the last ten minutes.

An Ceann Comhairle

Deputy Norton purports, I gather, to give a preliminary review of conditions agricultural and industrial, as his amendment pleads for the better development of both agriculture and industry. Nevertheless, I think the Minister is correct in suggesting that the detailed operation of the London Agreement is of very doubtful relevancy in this debate.

Mr. MacEntee

It is not relevant to the motion.

An Ceann Comhairle

The basis of debate is the report of the Banking Commission.

Mr. Norton

The London Agreement is of very doubtful value. It is not so long ago since we heard that the London Agreement was one of the phenomenal achievements of the Fianna Fáil Government. Now, if you make a reference to it, even a Front Bench member of the Government Party feels, if he can do it, that he should have you ruled out of order lest you may go on to deal with this phenomenal achievement.

An Ceann Comhairle

It should not be insinuated that Minister or Deputy can induce the Chair to rule anybody out of order.

Mr. Norton

It is the last thing I would think of doing.

An Ceann Comhairle

Neither is it orderly, if the Chair does indicate the irrelevancy of any matter, to refer to it again. That is a habit which a few Deputies are in danger of developing.

General Mulcahy

I did not understand that you were ruling that no reference should be made to the London Agreement.

An Ceann Comhairle

No, but such a detailed discussion of it as to include the decisions regarding British applications is outside the scope of this motion.

Professor O'Sullivan

In the amendment there is no definite reference to the Banking Commission.

An Ceann Comhairle

This is an amendment to a motion dealing with the Banking Commission. If it was not consonant with the motion it would not have been allowed.

Professor O'Sullivan

I suggest it purports to wipe out any reference to the Banking Commission.

Mr. Davin

I submit, in order that Deputy Norton may come to the point of the proposals contained in the amendment, that it is necessary to survey the existing situation. I submit that Deputy Dillon went much wider than the contents of the Banking Commission reports in his lengthy speech.

An Ceann Comhairle

Contrasting what Deputy Dillon was allowed to debate contains an implied reflection on the Chair. Discussing the details of the London Agreement is not in order.

Mr. Norton

I do not propose to examine the London Agreement in detail, but it is very interesting to have the Front Bench view on the desirability of avoiding a discussion on that now. My observations on the London Agreement were designed to point out to those listening to the discussion, and whose votes may or may not be influenced by the nature of the discussion, that when we are considering the economic position of the country and the necessity for the adoption of the measures indicated in the motion or the amendment, we must necessarily take stock, not merely of the existing industrial position, but of the dangers that lie ahead by virtue of the shackling clauses of that once phenomenal Agreement.

My main point on the matter is that the London Agreement has very definitely slowed down industrial production in this country. It is not so long since the last election, when we had some lyrical speeches made by the members of the Government Party indicating that during the next four or five years 300 new factories were going to spring up. I have been watching for the emergence of three of them— and that is not a very impetuous demand—but there is very little inclination on the part of the Irish investors, as distinct from the foreigners, who want to secure control of Irish industry, to invest their money. They are showing a complete reluctance to invest money in Irish industries, because they know that the competitors in Britain can now come before the Prices Commission and ensure that no matter what we may do towards protecting Irish industries, a foreigner, with all the technical assistance at his disposal, can present a case to negative the possible establishment, development or expansion of an Irish industry.

There has been a complete stagnation in the matter of industrial development for the past 12 months. But there has even been worse. Many firms, under the competition they now have to face from foreign importers, are finding it impossible to maintain even the former scale of production. In many of the new industries there has been not only a paying off of staff but there has been a complete inability to pay any dividends on ordinary or preference shares subscribed by Irish nationals in these undertakings. That, I suggest, is a development which cannot afford any great consolation to the Government.

Here, Sir, it might be opportune to advert for a few moments to the general policy of the Government in respect of industrial development. The whole policy from the outset has been one of imposing tariffs and waiting to see what happens. The Minister for Industry and Commerce, who is the mouthpiece of the Government, apparently believes that all you have to do in order to protect Irish industry and provide employment for Irish people is to impose a tariff on some imported goods, have them manufactured here, and then everything is all right. We have seen that policy in operation now for the past seven years, and at the end of that substantial period, thus afforded for review, we find 120,000 or 130,000 unemployed people, and the figures would be gigantic in their proportions were it not for the fact that our people —aye, and people with republican and nationalist views—are being driven to go across to make munitions for Great Britain because they cannot get employment in any of the industries established or assisted by the Government here.

There has been a disposition here to impose quotas and restrictions, but the net result of all that policy has been to leave us still with a very serious unemployment problem, with a very serious poverty problem, and with a standard of living for the masses of the people in this country which is a negation of all the vaunted Christianity in the new Constitution. There are other instances of a disquieting industrial position, however, if we make reference to industrial statistics. Even the employment we have provided has been of an intermittent and irregular kind. Take the employment period up to the end of 1938, and we find that the average number of contributions paid, in respect of every man in insurable occupations and liable to work for 52 weeks in the year, was only 28 contributions. That means those who were insurable under the Unemployment Insurance Acts, and it means that they were employed for only 28 weeks out of 52 in the last insurance year. If we pass on to women, we find that women were employed for 41 weeks out of 52. Then, in the case of boys and girls, we find that boys were employed for 23 out of the 52 weeks and that girls were employed for 24 out of the 52 weeks—all indicating that even the employment which we do provide for our people is of an uncertain kind, and that the annual income derived from it is not sufficient to ensure for these people a reasonable degree of prosperity in any annual period of employment.

If we look, again, to further Government statistics in order to ascertain the prospects of further employment, and the prospects of a continuation of a policy of providing additional employment, the figures are again disquieting. The exchange of unemployment insurance cards is a fairly reliable test of the amount of additional people offered employment in any one year. It is by no means an infallible test, but whatever its weakness or fallibility may be, if we get the same thing in one year as in another, looking again at Government statistics, we find that 12,000 new cards, which means new unemployment insurance cards, were exchanged in the year ended October, 1931. That rose to 45,000 in the year ended October, 1933. In 1936 the number was again down to 12,000, and in the year ended October, 1938, the number was only 5,000. One can understand only 5,000 being exchanged in 1938 if there was a famine of workers and if there was an inability to obtain workers, but in October of 1938 we exchanged only 5,000 additional cards, and yet we had 105,000 people registered as unemployed at the employment exchanges.

Can anybody imagine that these figures afford ground for belief that the economic position in this country is satisfactory? Bad as these figures are, however, they must be related also to other figures, and one of the figures, and one of the phases of our national activity, to which they should be related is the provision for the poverty which is caused by our inability to plan our industrial and agricultural development. We are constantly being referred to the fact that we are a creditor nation, that per capita our extern assets are such as to be the envy of every country in the world, and that the financial equilibrium of this country is such as to invite envy from other countries. Let us look for a few moments and see how all that accumulated credit and all that rock-like financial stability affects the person suffering under the destitution which the figures I have just quoted disclose. Take a town here in this country with a population of less than 7,000—and, of course, very few towns here have more than 7,000 of a population—and we find that a man and a wife and six children are expected, during periods of idleness—periods of enforced idleness—to exist on a maximum income of 14/- per week. Eight people are expected to live on 14/- a week. If you divide eight into 14 you find that each person, the father and the mother included, is expected to live on 1/9 per week, and if you look at 1/9 you find that it will buy less than four loaves of bread at the current price, and you may get a pound of beef and one loaf of bread for that price. That is the amount of sustenance which we provide for those who are the victims of our national incompetence. Instead of trying to provide them with work and utilising their brains and brawn and harnessing them to a desire to create wealth and assets for the Irish people, the standard of living we are providing for our unemployed people to-day is a workhouse standard of living. Every man and woman in this country who has to make the weekly trek to the employment exchange to receive his or her miserable pittance in the form of unemployment assistance benefit is, in fact, enduring the standard of living of a workhouse even though he or she may be outside the walls of the workhouse.

It is impossible, Sir, to exaggerate the privation and misery which the unemployed people of this country are enduring to-day as a result of the pauperised standards of unemployment assistance benefits which we pay to these people. That, then, gives a picture, at all events, of the poverty-stricken position of large masses of our people to-day. It gives you the position, not merely of the hard core of unemployment, but of the very substantial fringe of perpetual poverty which surrounds it. It gives you some idea, I suggest, of the necessity for revising our methods of industrial and agricultural development and I suggest that it demands also from the Government some more comprehensive plans than we have yet seen from them. If we are to have agricultural or industrial development, and if we are to stop the appalling drift of the flower of our manhood and the cream of our womanhood to Britain, we can only do it in three ways, and one of these is a rather transitory way. We can develop our industry and develop and exploit our agricultural position, and, pending the time when industry and agriculture can absorb our unemployed, we can develop large-scale schemes of public works whereby we could enrich the national estate and improve the general amenities of this country.

Does anybody believe that our industrial position to-day is capable of any greater expansion under the methods at present in operation? As I said, a few moments ago, our whole industrial policy has been one of imposing tariffs and waiting to see what happens. Tariffs as high as 75 per cent, and even 100 per cent., have been imposed on imported commodities for the purpose, presumably, of protecting the production of a similar article here. Once the tariff has been imposed there has been no real effort on the part of the Government to supervise the production of that article here, or to insist that the factory producing it should equip itself in the shortest possible time with the most efficient methods of production. What has happened has been that we have been imposing tariffs at a very high rate and allowing individual manufacturers or a public company, as the case may be, to produce just as much as he or it wishes, but only so much as he or it wishes for the home market. There have been notorious examples, and there are still notorious examples, of cases where tariffs up to 50 and 100 per cent. were imposed, on imported articles, while for the past four or five years the home factory has not been producing more than 15 to 25 per cent. of the requirements of the Irish market. Nobody has suggested to those manufacturers that the tariff would be withdrawn if they did not try to produce more, or if they did not become efficient so as to be able to compete in a relatively short period; but nobody has pointed out to them that, even if they do happen to be the owners of industry, they have a responsibility, not merely in an individual sense, but in a trustee capacity for the Irish nation. There has been no supervision at all—merely the imposition of a tariff, and the manufacturer can produce any percentage he likes of the former imports so long as he pretends to produce Irish manufactured goods. There has been no insistence that he must equip his factory with that efficiency that will enable him to produce goods in competition with the foreign importers.

There has been a complete lack of appreciation on the part of many of those manufacturers of the hardships which have been imposed on the community by consenting to a tariff position whereby the Irish manufacturer produces a fragment of the home requirements, while the producer is expected to pay a duty up to as much as 75 per cent. on goods which formerly came in free. Firms have been allowed, notwithstanding the imposition of tariffs, to carry on in a huxtering fashion. There is no supervision and no attempt to compel efficiency. There is no attempt to insist that there is an obligation on them, if the community imposes hardships on itself by the imposition of tariffs, to produce all the goods required for consumption for the Irish people.

That has been the position on the one hand. Of course, there have been other manufacturers and producers who have done well, the people who "made hay while the sun shone." There has been no supervision at all over the men who will not produce and use the present position to the national advantage: no supervision over the get-rich-quick merchant who has grown up in this country. Take the case of the flour milling and bacon-curing industries in the last few years. There is one thing that this Government can, at least, take a pride in, and I for one will pay tribute to them, though I am sorry to have to pay it. They have done for the millers of this country more than any other Government ever did. There is at least one British miller who has got from this Government much more patronage, much more assistance and much more profits than he could ever hope to get from the Government in Britain to which, politically, he gives allegiance. If you are a bacon-curer you can do anything you like, in the view of the bacon-curers—the new rich—with a pig so long as you can get a substantial profit out of it and so long as you can get the Irish people to buy it at the fancy prices that are charged.

The millers and the bacon-curers have been allowed to do what they liked. The Government, which at election time says that it is a poor man's Government, allows the unfortunate working-class people of this country to be exploited by a ring of bacon factories and a ring of millers in a most shameful manner and there is not the slightest indication that the Government realise the necessity for dealing with a situation of that kind. If I were a miller in this country—if I were a British miller in this country believing in the Empire and worshipping it with the Union Jack wrapped round me—whatever I might think of the Government's political complexion, I would have no hesitation in saying that economically and financially this Government of Eire, which despises the Union Jack at times, is a better Government from the point of view of a British miller than any British Government. Any British miller who has come in here in recent years has had good reason to thank this Government for what it has done for him, for doing for him what the British Government would not do for him in his own country. The British consumer gets his goods at a reasonable price. But the Irish consumer must consume products owned by an Englishman in this country, and that producer can do just what he likes. It does not matter apparently to the Government if the Irish people cannot buy, except at his ransom, his products. In the case of the flour-millers and of bacon production, the Government have this record to their credit, and I think it is a disgraceful record. It has made the millers and the bacon curers wealthy, but they have become wealthy at the price of impoverishing the masses of the Irish people who consume the products of those two industries.

It is bad enough to exploit the people in the case of these two commodities, but there has been a very substantial rise as well in the price of the general level of commodities in the country. I propose to take two comparable figures, the cost-of-living index figure for November, 1932, and for November, 1938. Taking the month of July, 1914, as the base, the cost-of-living index figure for November, 1932, was 155, an increase of 55 per cent. over the July, 1914, figure. The cost-of-living index figure in November, 1938, was 176, an increase of 76 per cent. over the July, 1914, figure, so that between November, 1932 and November, 1938, the cost-of-living index figure jumped by as high as 21 points. Even these figures do not adequately measure the real increase in the cost of living because that is related to a weighted basis of ascertainment. Many of the commodities which are used and are stable articles in Irish working-class families have increased during the period I am dealing with, not by 14 per cent. or 17 per cent. but by as much as 25 per cent. and 30 per cent. So that with a wave of poverty and destitution on the one hand, we have rising prices on the other hand, and a complete inability on the part of the Government either to put the unemployed into productive employment or to enable those who are partially employed to meet the rising cost of living as disclosed by those figures.

One may well ask now whether these facts and figures, and the appalling position which they disclose, represent a complete consummation of the Fianna Fáil Party policy?

On the one hand, we have large-scale unemployment, 80,000 people on unemployment assistance, 30,000 people each year exported to make munitions in Britain, and we have the various other instances of distress to which I have referred. What have we, on the other hand, as the Government's achievements? All those consequences represent the net position after allowance has been made for whatever has been done in the interregnum. We have got this position after a seven years' period during which we were told the only danger in which the Irish people stood under the Fianna Fáil Government was the danger that they might be drowned in the deluge of milk and honey which was going to be released on the country. This motion which has been submitted by the Fine Gael Party in the names of Deputy Dillon and Deputy Mulcahy refers to the necessity for taking certain steps in view of the contents of the Majority Report of the Banking Commission, and it asks that those steps should be taken at once. I have read the report of the Banking Commission. In so far as time was available. I have read the comments on the report of the Banking Commission, and I want to say at the outset that the Banking Commission's report was purely a pro-British Banking Commission's report.

Mr. Dillon

The Bishop of Raphoe will enjoy that observation.

Mr. Norton

The Bishop of Raphoe at one time threatened to resign, and in fact did tender his resignation. Deputy Dillon might try to ascertain why, and why he withdrew his resignation.

Mr. MacEntee

Has the Deputy got the Bishop's authority to make that statement?

Mr. Norton

I did not know that the Bishop had appointed the Minister as his advertising agent.

Mr. MacEntee

I am rather surprised that he appointed the Deputy.

Mr. Norton

Nobody is surprised at what the Minister says. I hope he did not appoint the Minister?

Mr. MacEntee

I wonder if the Deputy is once again being guilty of a breach of confidence.

Mr. Norton

What is the purpose of the "once again"?. Are you ruling on that, Sir? The Minister for Finance has charged me with being "once again" guilty of a breach of confidence. I want to know whether it is permissible for the Minister for Finance to say that. It is untrue, but, apart from that, is the Minister permitted to say that in the House? I have been charged by the Minister with being "once again" guilty of a breach of confidence.

An Leas-Cheann Comhairle

It is so indefinite, I do not think the Chair can rule on it.

Mr. Norton

You do not consider that my honour is impugned by a statement of that kind?

An Leas-Cheann Comhairle

I do not think so.

Mr. Norton

Because the Minister for Finance said it. I accept that assurance. So far as there is a Majority Report of this commission—and it is very hard to say, when ten people out of 21 sign a report, whether it is a Majority Report—that Majority Report was a pro-British one. As a matter of fact some of the people who have signed the report have been architects of British finance or instruments of British finance either in Britain or on the Continent.

Mr. Davin

Under different names in some cases.

Mr. Norton

Some of them have been closely associated with British finance policy in Britain; others have been associated with British finance policy elsewhere. Those were the people selected by the Taoiseach to advise him as to what should be done with the banking system in Ireland. It is no wonder that certain papers found themselves called upon to comment on the Banking Commission. The friend of the Minister for Finance, the Irish Times, said:

"The report was so conservative that it almost might have been prepared in Manchester 50 years ago."

An English Catholic paper, The Tablet, said:

"The primal mystery, a mystery that has never been solved, is why Mr. de Valera entrusted the task of reporting on his policy to a body of men notoriously unsympathetic to him."

Mr. Dillon

Is that the Irish correspondent?

Mr. Norton

It is a quotation from The Tablet. Deputy Dillon can read it for himself.

Mr. Dillon

I think I have read it.

Mr. Norton

Then, he does not suggest it is the Irish correspondent? Those are two views. The pro-British character and the conservative character of the Banking Commission Report compelled the Irish Times to say that it might have been written in Manchester 50 years ago, and a very conservative, highly reputable, Catholic newspaper in Britain said they were mystified at the appointment to the Commission of certain people who were so well known to be opposed to any change in policy that even the Taoiseach's reasons for appointing them would remain the primal mystery. What does the Banking Commission's report involve? An examination of the report will disclose that its main purpose is to tell the people of this country: “Although tens of thousands of of you may be unemployed; although tens of thousands of you must remain on home assistance; although 30,000 of you must go to Britain each year to find employment; although the vast masses of you must live under conditions little removed from a workhouse standard; nevertheless, we are to continue in this country the British banking system. So long as we continue to maintain parity with sterling then, during the periods when you are unemployed, or when you are on the emigrant ship, or when you are waiting for the home assistance officer to call on you, you must feel that everything is all right because we are linked with Britain for sterling purposes.” That is the substance and the main philosophy behind the Banking Commission's Report. What purports to be a majority of the members makes recommendations. Those recommendations, I may point out, have been subjected to very careful scrutiny by many eminent Irish economists who have been anxious to ascertain the effects of the main report and the subsidiary reports on the future development of Irish credit and currency.

The report goes on to make representations which amount to a complete restriction of the State's activities in the matter of the promotion of schemes under the aegis of the State. They suggest that the whole policy of acquiring and dividing land should be stopped; that it is a costly arrangement; that we should continue the system of the small unemployed cottier and the large rancher. They suggest, too, that trade loans, which have been approved of by this Government and the previous Government, should be discontinued, so that many of our Irish industries would be in the struggling position which they would occupy were it not for the facilities and the assistance given to them under the Trade Loans (Guarantee) Acts. They suggest, too, that semi-State or virtually State undertakings, like the Electricity Supply Board and the sugar company, should revert to private enterprise. After all those recommendations and others have been made, they suggest that the only thing which is necessary now is to cut down public expenditure, which means in effect cutting down income-tax, cutting down supertax, and cutting down any of those other types of taxes which press upon the wealthy class in this country. I suggest that what purports to be the Majority Report and the signatures to it are well worth perusing. The signatories consist in the main of people impregnated with the British conception of finance, people whose whole training has been in the British conception and purpose of finance. Those are the people who are suggesting to this House, at a time when the nation ought to expand its credit and mobilise its resources for further development, that the only policy to be adopted in their view is to curtail the many beneficial activities which exist to-day. The report might as well have been written in London. Some of the views in it have been the views of the banking centres in London. If the British financial interests were to express a view on what may be described as the Majority Report of the Banking Commission, their viewpoint would be that from a British standpoint it is a very good report. But it is a very good report in the interests of people who are interested in anchoring us to parity with British sterling and who want to keep us there, no matter what the consequences may be for this country.

I ask myself, on the principle of what is good for the hounds is usually good for the hare, if folks of that kind want to anchor us to British sterling, want us to leave things as they are, and want us to leave the boat unrocked, whether that is the kind of policy that ought not to make us suspicious. The poverty of our people is being made the excuse to justify the continuance of the conditions of affairs which has brought about that poverty —that there is no necessity to do anything to relieve that appalling poverty beyond maintaining the present financial and currency position and cutting down governmental expenditure. They are not concerned whether you cut down old age pensions; they are not concerned whether you cut down widows' and orphans' pensions; they are not concerned whether you reduce the national health insurance benefit, the unemployment insurance benefit, or any other of the social services. Get down public expenditure, they say, and these items are public expenditure. They believe that when you get these down, then you will probably get down income-tax and supertax and this may be just a nice little paradise for folk like millers and bacon curers to invest further money in Irish industry. One would imagine that it meant the end of this nation to suggest that the relation between our currency and British sterling should be disturbed. New Zealand has found it to its advantage to disturb its relationship with sterling. Australia has found it to its advantage to disturb its relationship with sterling —it has not maintained the parity that we do. Denmark has found it equally advantageous to do so.

Mr. MacEntee

Does the Deputy suggest that the Australian pound is not linked to sterling?

Mr. Norton

No. The Deputy is not as silly as the Minister. He maintains that New Zealand and Australia do not maintain the parity we do. If the Minister does not know that, he ought to resign at once.

Mr. MacEntee

If the Deputy means that their pound is not worth what our pound is—yes.

Mr. Norton

If the Minister does not know that the relationship between the Australia, New Zealand and Danish currency and British currency is different from ours, he ought to resign and let somebody else occupy his position who knows something about finance.

Mr. MacEntee

He knows that, but he appreciates the significance of it, which the Deputy does not.

Mr. Norton

It is good to have it on record that the Minister appreciates something. That is a revelation. The Minister's friends on the Banking Commission, who can be numbered amongst the ten, have advised the Minister and the Taoiseach and the nation generally: "Do not get away from parity with British sterling." There is ruin there, according to the famous ten who signed the Majority Report. The Minister for Finance, judging by his disorderly interruptions, is apparently on their side. He thinks it is dangerous to try to get away from that. I want to suggest to other people, who do not worship in the same suppliant way, that the Minister does at the feet of British and international financial experts with the British financial mentality, that it does not look nearly as dangerous as the report of the famous "ten talents." I have heard the interruption about 16 members.

Mr. MacEntee

The Deputy has at last discovered that there were 16 signatories to the Majority Report.

Mr. Norton

I know how the Minister heard it. The Minister did not know about that until the information was carried to him. If the Minister's nerves are bad, I will not feel hurt if he leaves the House to repair them. Of course, 16 people signed the Majority Report. Anybody who read the report knows that. But six of them signed it with such wide reservations as clearly to indicate that they were not at all subscribing to the Majority Report. It is true that they signed the Majority Report with such reservations. Sixteen people may decide to do a certain thing, but the 16 may say that they are going to do it on such terms as to mean that they are not going to do it at all. That is in fact what happened with the Majority Report. In any case, let us look at this awful danger against which this Majority, or so-called Majority Report, warns us. We are told that we ought not to get away from sterling, although New Zealand has done it, Australia has done it and Denmark has done it. There is no farmer in this country to-day who would not be glad to live here if the farming industry were able to export to Great Britain the quantity of the commodities which New Zealand, Australian and Danish farmers are able to export to Great Britain. We are to keep on sterling— the Banking Commission advises us to do that. But the three small and somewhat comparable countries which have gone off sterling, which have a new relationship with sterling, are able to meet us, notwithstanding their remoteness from Great Britain, by exporting to Great Britain much more agricultural goods than we do in many respects, and they have been able in the past four or five years to increase their exports to the British market by a very much greater percentage than we have been able to do.

The abandonment of complete anchorage to sterling has not meant for these countries the catastrophe foreshadowed by the Report of the Banking Commission. Instead, the working-class people and the farmers of these countries enjoy a standard of living that is incomparably higher than that which is the lot of Irish workers and Irish farmers. I do not accept the position at all in the Banking Commission's Report. I believe it is pro-British in conception and pro-British from the standpoint of the road which it advises people to travel. Its whole emphasis has been to get back to the policy of the production of cattle, and an abandonment of a goodly portion of the development of our secondary industries. The Banking Commission emphasises getting back cattle production with all that that means to this country. It means that unemployment is to continue; it means large scale emigration; and that can only be continued if we are prepared to tolerate a situation whereby we are to have a large rancher class exporting bullocks or beef to the British market, the maintenance of a professional class and, at the same time, it means poverty-stricken cottiers scattered about the country. That is what a reversion to cattle production means. That is a policy which no Government can ever think of going back to, except at the price of revolution on the part of the Irish people.

The amendment takes stock of the serious position of agriculture, the existence of widespread unemployment, the impoverished position of large masses of the people, and it is to these matters I have adverted in the course of my remarks. It cannot be denied that the position economically, industrially, and of agriculture, is such as to warrant the very serious consideration of any Government charged with the responsibility of developing the resources of our people in the interest, not of a few, but of the three million human beings comprising the nation to-day. I should prefer a motion of this kind to be discussed objectively and unrelated to the cut and thrust of Party politics. Apparently it is not possible to get a situation of that kind, and one has, therefore, to view it from the standpoint of one's own political or economic outlook. No matter what the cut and thrust of the debate may lead to, and no matter what the result of the vote may be, there is a serious situation here that will tax the ability and the ingenuity of people of goodwill amongst all Parties. Some effort ought to be made to try to get agreement on the basis of grappling with it in that way and at least trying to do something, notwithstanding our political disagreements, which will rescue masses of our people from the poverty they are enduring to-day.

The amendment suggests that the Government should.

"submit to the Dáil at once proposals for the better development of agriculture and industry, utilisation of the credit of the nation to stimulate such development and the absorption of the unemployed workers in productive employment at adequate rates of wages".

I do not think we are asking the Dáil to do anything which is outside the capacity or the ability of the Administration. We have been told, and it is an undeniable fact, that we are a substantial creditor nation with very substantial external assets. If we are a substantial creditor nation with substantial external assets, we are in a position which even, according to the most orthodox standards, is financially sound. When we come to look at the soundness of our external assets and at what our position as a creditor nation gives, and apply that to agriculture, we might as well not have any external assets or be a creditor nation, because the position of agriculture is deplorable, and that is due to the complete absence of any facilities to assist agricultural production. If we look at the economic position, we find that, notwithstanding our foreign investments and our credit position as a nation, the position is such that we have 105,000 unemployed and, in respect of them, we might as well not have £1 invested in any external markets.

There are no adequate credit facilities for any section of the community provided by the medium of the present joint stock banks. Our proposal is that in a situation of that kind, what the country needs is not an economic reflection of a policy that is in the interest of wealthy people as adumbrated in the motion in the names of Deputy Dillon and Deputy Mulcahy. We believe the road to salvation and the road which will lead to the rescue of our people from the poverty they are enduring to-day lies rather in the direction of the amendment. We feel that what is required is a survey of human and citizen needs, and a survey of the other potentialities of the nation, and its ability, under proper planning and direction, to supply those human and citizen needs. We feel that a policy along these lines will at least enable us to know the extent of our needs and the possibility of supplying them. When we come to ascertain the real possibility of supplying our needs, we must inevitably look to agriculture and industry. In agriculture, we have a position in the world which is unique, a position which no political consideration should induce us to ignore. We have proximity to a market which absorbs a substantial amount of our agricultural produce.

Mr. Dillon

Hear, hear!

Mr. Norton

Notwithstanding the viewpoint of people who inhabit that country, if we admit that we should sell them goods, and we are selling them goods to-day, then, we would try, if it is profitable, to sell the maximum amount of goods that we do not require for home consumption. How can that be done to-day? We are being beaten in the British market by Australia, New Zealand, Denmark. We are being beaten there because the Governments of these countries had vision and had the courage to plan more radically than any Government here. We are in the position that we are within 60 miles of a market that is capable of taking our produce, and, in fact, is taking substantial quantities of it, and it would be worse than lunacy not to try to exploit our position to such an extent that we could not merely continue to supply the present quantity, but further to increase our exports, if it is profitable to do so.

Mr. Dillon

Hear, hear! It is late in the day the Deputy learned that.

Mr. Norton

I learned that before the Deputy was ever a member of this House.

Mr. Dillon

You forgot it since I came into it.

Mr. Norton

In respect to the organisation of agriculture, no insurmountable difficulties present themselves against the fuller exploitation of our agricultural position. It is an industry which, having regard to its circumstances, and to our proximity to the British market, lends itself to exploitation and reorganisation on a scale which would yield much better results than have been secured by the present haphazard methods. We must break, I think, from the somewhat individual policy on which it has been carried on. We must try to inculcate into our agricultural industry a belief that collective or State marketing does not present the dangers that people fear, and that it is possible to do here what has been done in other countries, to organise marketing facilities in respect of the export of our produce under the aegis of the Government, or under the aegis of a semi-Government undertaking, and that we should plan our financial and credit policy in agriculture so as to be able to market on a national scale. Then, I feel that we should achieve a revolution in a relatively short space of time, particularly having regard to our position in relation to the British market.

In respect to industry, there has been no planning. Almost any attempt at planning would be better than the present unsatisfactory position. No one is thinking nationally in respect to industry, and no one has been planning nationally. The whole policy has been merely a huxtering one, quite unrelated in any way. The raw material of one industry is being taxed so as to enable another person to attempt to produce from that raw material and to supply a small percentage of the Irish market. That kind of disordered industrial development can only yield chaos, and the complete absence of any supervision in industry is such as to arouse grave doubts that we are not now on the threshold of a long period of disillusionment in respect of such industries as we have already established.

In the matter of industrial development, our view would be that while every industry capable of development here should be protected against foreign competition, that protection ought to be afforded on the basis that the industries which get the protection should get a period of time, but only a period of time, in which to make themselves efficient and get sufficiently equipped to deal with foreign competitors; that they should be compelled to produce, in the interests of the nation, the entire requirements of the Irish market, and for these considerations they should be compelled to offer the maximum amount of employment at the best possible rates, at rates of wages and under conditions of labour that the industry of the nation can afford.

Even when you plan industry and try to rationalise agriculture you still have a situation whereby it will take some time, perhaps, before you can absorb your unemployed into productive employment. It is there, with the nation using its credit position and the facilities at its disposal, that it can get advantage from the fact that it is a creditor nation with substantial extern assets. In this country, the surface of which has been only relatively scratched, there are enormous possibilities for the development of large-scale schemes of public works. If one goes to any city, town or even a fair-sized village, one is at once struck with the amount of neglect of public and private property and the benefits which would accrue to the nation and the local community if steps were taken to make that decay the object of a Governmental survey, with a view to utilising the unemployed manhood of the country to operate upon these sadly-neglected public amenities.

Public works are capable of employing a very substantial number of people. They are capable of adding very substantially to the amenities of the country. They are capable, on that account, of bringing into the country a substantial number of tourists and, by the cumulative effects of these factors, they are capable of enriching the nation and providing considerable employment. Once we can concentrate on the production of more agricultural goods, and of more industrial goods to offset the imports from other countries, we need not be afraid to embark upon a large-scale scheme of public works, feeling convinced that all expenditure under that head will at least be assured of stability by the fact that in the domains of production for export or production for home consumption we are creating new assets against whatever may be created in the form of public works schemes

Our proposal asks the House to take that line, believing that it is the best line in the interests of the country. We can take the line of the motion, which is going to mean more cuts in old age pensions, less widows' and orphans' pensions, less unemployment assistance and unemployment assurance, and, incidentally, perhaps less income-tax and supertax for the wealthy folk in whom the movers of the motion are interested. We can take another line. We can carry on the present Micawber-like policy of the Government and wait for something to turn up, hoping that something will happen which will extricate us from an unsatisfactory condition, hoping that the situation, through some phenomenal occurrence, may change for the better, or we can take the line suggested in the amendment of considering and submitting to the Dáil comprehensive proposals for the development of industry and agriculture, for the utilisation of the credit position of the nation and provide for our unemployed, and indeed for all our citizens, a guarantee against want and against the poverty and misery and degradation which tens of thousands of them are compelled to endure to-day.

We can take that road if we like. If we do, I think, no matter what difficulties may be encountered, one can at least see the triumph of the nation over the deplorable position in which it finds itself to-day. But if we fail to take the road of organising the country's resources, of mobilising the potentialities within the country and utilising its credit position, then we will drift on in the same unsatisfactory way as we have been doing for the past seven years, and another seven years of what we have gone through will make this country not the Ireland that many aspire to make it, but a tenth-rate country, a Balkan State in Western Europe.

Mr. Hurley

I formally second the amendment, and I reserve the right to speak later.

Mr. Dowdall

I am speaking to-day by reason of the fact that yesterday I listened to a most interesting talk by a gentleman who was very well qualified to give us his views with regard to an experiment carried out in his own country. He made it abundantly clear, and I do not think Deputy Dillon has stressed this point, that he did not want any credit issued without production and he said very definitely that if there were no production you could not issue credit. If you have production in the country sufficient to take charge of the money issued, everything would be in order. All this arises out of the Banking Commission reports, the comments made upon them and the subjects introduced by reason of them. New Zealand has got into the position in which she is, not by reason of this experiment. They borrowed £90,000,000 and, of course they cannot pay their old debts. They are doing the wise thing. They are starting off looking after their own people and the debts can come on afterwards.

Mr. Dillon

That is a grand doctrine.

Mr. Dowdall

They supply goods to pay the interest. They cannot renew the loan without getting some help from the lender. Although this is not very relevant to the debate, the point is that if they do not get a loan the only thing for them to do is default, and they have a very good example from the lender. This matter of credit seems to be like a bogeyman. Certain people object to it and the reason they object is because of their acquired habits, habits that they have grown up in. They think the things that are, are the things that ought to be. They never think of anything that is new and that might offer a means of getting out of the morass into which many nations have sunk, and in which we are. They cannot try any experiments. They are afraid of the bogeyman and of their own imaginations. We want houses built and the Banking Commission suggest we should not build any more.

If we want houses built, I think it is the duty of the State and not of the Government. There I differ with other people. In New Zealand, the Government seems to have the power, but I say that it should be the State and not the Government, because a Government, just like other institutions or individuals, is exposed to temptation and might get too busy with the handle of the printing press, and you cannot have any real prosperity, as the gentleman who spoke yesterday told us unless you have production to meet the money that you issue. Now, I want to stress that point and I want people to get it into their heads, because it is very important that we should look at things as they are and not as we think they are. I think it would be a very good thing for Deputy Dillon and also for members of our own Executive Council and many people up and down the country as well as in other countries if they were to get the cobwebs out of their brains and to have the scales taken from their eyes. If that were to be done for them, they might be inclined to look at things in their proper perspective and they might find that there is a possibility, in some of the things that are put before them, of finding a way of getting out of the morass into which we have got.

Mr. Dillon

Who got us into the morass, Deputy?

Mr. Dowdall

As Deputy Norton said, the position is deplorable in many ways. I do not want to go into the reasons for that now. The reasons for that go back many years, and neither this Government nor the late Government can be blamed for that state of affairs. It may go back for 100 years, for that matter, so far as the reasons are concerned, and I suppose that even then we would not get to the end of it, but I say that one of the causes that New Zealand, Argentina and some other countries are in the hole they find themselves in to-day is that they diverted all their energies to providing food for countries that are not now able to take it. Now, it must be remembered that such work as housebuilding is reproductive work, because you can make your retirements day by day or week by week as the rents come in. If a sum of £1,000,000 is spent in building houses, and the rentals from these houses come to £25,000 a year, that means that it will be paid off in 40 years. If interest at 5 per cent. is charged it would mean an extra £2,000,000 instead of the original charge of £1,000,000. What we want to do is to make it possible for the ordinary working people to pay a rent such as their wages would permit and live in some comfort at the same time. I think that the Government is not acting in the best interests of the country if, so far as housebuilding and the getting rid of the slums are concerned, they do not go in for providing credit for that purpose. The question there is the repayment of the rent. Of course, I know that quite a number of people would try not to pay any debts if they could avoid paying them.

Now we come to this question of parity with sterling and keeping with sterling. I cannot guarantee the exact figures, but we were reported to have something like £300,000,000 of investments in England. Deputy Dillon gave one figure, but I think he was referring to the banks' amount. At any rate, I think it is something about £300,000,000, although that is only an estimate. Now, when England went off gold, that depreciated at once to £200,000,000. They took away £100,000,000 without a by-your-leave or anything else to anybody. Now, if you go down Dawson Street and turn into Nassau Street to the left, there is a shop there advertising that they will pay 34/- for sovereigns, and more for quantity. The position is that the sovereign, which was worth 20/- previously, is not worth anything like that. It is only worth about 12/- or less, and if we have a war it may be worth nothing at all, but whether we have a war or not it is going to go down more, and then we lose more of that £300,000,000 that we had there. Why are they issuing all this credit over there for the production of armaments, and where did they get all the money that they spent in the last war? It was not there. Deputy Dillon says that the income of England is about £5,000,000,000—perhaps he will correct me on that—but the last figure that I remember was £2,400,000,000, and the total capital value of the English railways, docks, warehouses and so on, was £14,000,000,000 all told. I am not questioning that the Deputy has given me what he thought was the case, but my figure was £2,400,000,000.

Mr. Dillon

Perhaps the Deputy would permit me to interrupt him for a moment. If he will refer to column 2372, No. 23, Volume 22, of the Seanad Debates, he will see that Senator Johnston, who is an economist, says that the national income of Great Britain is estimated at £5,000,000,000, and their Budget is well within the £1,000,000,000 mark.

Mr. Dowdall

Yes, but I presume chat Senator Johnston is not exactly infallible.

Mr. Dillon

Oh, no.

Mr. Dowdall

Well, the figure I remember was £2,400,000,000.

Mr. Dillon

I am only giving the Deputy the source of my information, and Senator Johnston is an economist.

Mr. Dowdall

At any rate, you had all that money that was spent on the Great War and now you have all the money that they are spending on armaments, and where is all that money coming from? Where does it come in? They are turning the handle of the printing press. Why the devil do not we do it also to that extent? I do not want it to be done for any more than we have production for. When England makes an issue, the banks accept it and the people accept it. They accept the money as being all right because they think that England has got capital goods. Deputy Dillon has stated that it will have to be paid sometime, but if there is a war, neither the capital nor the interest may be paid, and if there is not a war the capital will never be paid. There is no doubt about it. It will not be. There are factories built on the east coast of the United States of America—much bigger factories than any we have here—which were erected for the purpose of trading with Europe. Some of these factories have never been opened and the others have been shut. These are tremendous factories. So that that means that the capital goods they have got, in the nature of factories and buildings, may be of no value at all. Take British trade in India, China and elsewhere. If Japan increases her cotton trade to these countries, Lancashire cotton mills will go to rack and ruin.

All this, however, is beside the point. What I am interested in is the question of unemployment. Deputy Dillon, when he first came into this House, made a speech one evening and harrowed all our feelings by what he told us of the conditions under which the poor in Dublin had to live. He said something similar this evening, although perhaps he did not harrow our feelings to the same extent. The fact is, however, that people do not realise the conditions under which the bulk of our people are living. The poorest man in the country is just as important as any of us here or as any other person in the country, and his interests should be looked after to as reasonable an extent as we can look after them. I am not trying to make any capital out of this. I am looking at the matter from the purely humanitarian and Christian point of view that we should do all that we can for the under-dog all the time.

Deputy Norton called attention to the numbers of unemployed we have here. I think he said that there were 130,000 unemployed at a certain date in February. It is about 70,000 now. It varies during the summer, although I do not know why.

Mr. Davin

Due to the Employment Period Orders.

Mr. Dowdall

Well, at any rate, there were 100,000 people unemployed and there were at least another 100,000 under-employed—people who were unable to earn enough to provide themselves and their families with sufficient food. We are simply begging the question if we do not realise that at least three out of every five persons have not got sufficient means to supply their requirements in food, clothes and housing. If that be so, I do think that this Government should do everything within its power to clear up the position. The situation is simply monstrous. If you have any trouble in your own house, you will try and clear it up. Government is merely housekeeping on a large scale. The Government have 3,000,000 people under their care. A large proportion of these people are unemployed, under-employed and not sufficiently nourished. It is the Government's bounden duty to look after them and nobody in the country will object to their doing so. If they should object, they should not be considered. Deputy Norton stated that he would be glad if we could eliminate Party feeling from this question, examine the position together and try to come to some agreement. I had that idea in my mind, too, and I am glad the Deputy mentioned it because I do think that the position is so desperate for people in the country—not for members of the Oireachtas—that the Government should take counsel amongst themselves and see what they should do, even if it means a rapprochement with the other side. The people are badly off. I do not mean to say that that is all the fault of the governing classes or the well-to-do. The people themselves are to blame, to a great extent, in ways, but that is another question, with which we are not dealing now. I do not wish to disturb the debate and I do not think that I would have power to do so, but, instead of having this matter come before us in a debate on the adjournment, I think it would be better if members of the House and of the Government would try to inform themselves on the subject before we come back after the adjournment. The position is really a very bad one. The sands in the glass are running out and, as Deputy Norton said, we are going to have a frightful country here after a time if something is not done. Great Britain in the final weeks of the Great War was spending £8,000,000 a day on armaments. She is now spending £2,000,000 a week on aeroplanes. Where is all this money got? There is only £2,200,000,000 worth of gold in the whole world, at the old valuation. The last war cost the nations something like £50,000,000,000 and, in view of that, it is fudge to say that you cannot issue credit unless you have a gold basis for it. There was no gold basis for that issue. If it is possible to issue money for war, the result being destruction, why cannot we issue money to the extent to which we can produce consumable goods for that purpose? I do not want to dogmatise on the matter, but I think the position is well worthy of examination. I do not think that anybody should accept the present position simply because they do not approve of this proposal.

What is wrong with the orthodox economists and the banks? I do not refer to the banks here, because the trading banks here and in England are all right. It is the people who manufacture the money, like the Bank of England, the Bank of France and some of the other banks on the Continent that are causing the trouble and not the ordinary trading banks. I have had 50 years' experience as a trader and, taking things all round, I must say that I have been treated very well by the banks. I cannot complain at all of them. We learned from the visitor from New Zealand yesterday that the trading banks are continuing their ordinary avocations. If we make any change in our method of issuing credit, whether we do it ourselves or get somebody else to do it, the banks will continue as they are. If they were to refuse to advance money for housing, then the matter would have to be considered. I quite appreciate the position of Deputy Norton and Deputy Dillon, with whom I am in agreement in many things. I do think—though some people may not agree with me— that Deputy Dillon spoke in good faith, but he wants to clear his mind of cobwebs and his eyes of scales. If he does that, he will be a very useful member of the House. The matter is very serious. You cannot have a running sore spreading disease in the community, and that we have. Why should not the Government make some attempt to change the system of issue? What is sacrosanct in the note issue we get from abroad more than our own note issue as long as we have got the goods to meet the notes? We would not have to pay any interest and would merely have to meet accountancy charges. That is, of course, only for productive works. I do not want to dogmatise on the matter, but I do hope that the members of the House will seriously try to bend their minds to the consideration of this subject so that when they come to deal with this matter again, they will know what they will be talking about.

Professor O'Sullivan

I wish Deputy Norton or Deputy Dowdall would help me to clear my mind of some of the cobwebs that have got attached to it during the last two hours. Anybody who knows Deputy Dowdall knows the extraordinary interest he has always taken in the position of the poor and I can understand his anxiety in that connection—an anxiety which is shared by everybody in the House. However, I did not grasp from his speech what his attitude was either on the motion or on the amendment. I looked with a considerable amount of interest at the amendment standing in the name of Deputy Norton and his colleagues because, except for one very doubtful phrase, I thought it was a resolution we could accept. The one doubtful phrase I expected some enlightenment upon but I got no enlightenment either from Deputy Norton or from Deputy Dowdall. The real gist of the amendment, apart from some altogether unwarranted attacks and suppositions that Deputy Norton made on the purpose of our resolution, was the phrase "utilising the credit of the nation". I did expect from the Leader of an important Party in this House, who put down a motion of that kind, and I did expect from Deputy Dowdall, occupying the position that he occupies, or that he occupied up to a moment ago, and because of the views he holds, that I should get some more enlightenment on the nature of this "credit of nation" than the mere ipse dixit“Let us cut free from sterling”. I ask anybody who listened to Deputy Norton's exposition, whether he had any other suggestion to make of what he means by utilising the credit of the nation for these estimable objects he has in view, except to cut free from sterling? I would ask the House also to cast their minds back on the various cobwebs Deputy Dowdall removed and whether there was anything else in his speech except two things: first of all, to cut free from sterling and, secondly, the suggestion that there is no difference between the Government raising a loan, the interest of which it must meet and the capital of which it will be responsible for paying back to the lender, and the Government going in and printing off money. As I understood it that was the actual suggestion of Deputy Dowdall and I wonder did it throw light on what I consider the main purpose of this amendment.

I waited—and it will be confessed that Deputy Norton was not unduly brief in his exposition—minute after minute, in fact quarter of an hour after quarter of an hour, for some enlightenment as to how the credit of the nation was to be utilised for this purpose, how industry and agriculture were to be helped. I confess again that I do not know what is his policy for agriculture. There were moments when I thought he surpassed the palmiest days of the Fianna Fáil Party in desiring that we should have nothing to do with England, in condemning the very idea of exporting our cattle to England, and in suggesting that if we returned to a policy of that kind, there would be a revolution in the country. I was rather surprised at that and still more surprised about two minutes afterwards when I heard a laudation of that excellent market, especially for the sale and consumption of our agricultural goods, and when I heard mention of the unique position we occupy geographically in being so near to that market. I do not think, with all respect to the Leader of the Labour Party, that a speech of that kind exactly tells us how we are to find the money for all the things he wants, for the help which he wants for agriculture, our major industry, or for some of the secondary industries to which he referred.

He says that we shall have to depend on the products of our main industry and our secondary industries. Quite so; let us realise that. It is because we, on these benches, realise that and realise that every person in the community, worker as well as employer—in fact, worker even more than employer, because an employer has sometimes a nest egg put aside—poor man as well as rich man, is dependent on what we can produce, that we think it is necessary to take steps to help those engaged in agriculture, which even Deputy Norton and, I believe, even now the Government, are at one in regarding as the primary industry —in seeing that that industry is made as productive as possible and in seeing that our secondary industries will also get a chance. We think it is not a stimulus and it is not a help to industry to make the cost of production impossible, to insist that we have all to live on the produce of agriculture and of our own secondary industries and at the same time to make the price of the raw materials of these industries such that they will be unproductive. It is in order to avoid a situation of that kind to which we are drifting, warned as we were by the Report of the Banking Commission, that we put down a motion of this kind.

As I have referred to the Banking Commission, and as I am a member of this Parliament, I should like to say one thing. We may or may not agree with the views of any of the 20 gentlemen who unselfishly gave their time to drawing up this report. There are many things in the Majority Report with which some of us may disagree. There are things in the Minority Reports with which we may disagree. But about one thing we should be clear. We should be thankful to the people who gave their services on that commission and I think for a Leader of a responsible Party to get up in this House and insult members of that commission, is not a thing that is in keeping with the dignity of this House. He may disagree with them but that is no reason for accusing them by implication of mala fides. They were asked, 20 of them, by our Government to do a certain task. I believe that to the best of their ability these men performed that task. The suggestion that a majority of them recommended a continuance of the connection with sterling because they were engaged in pro-British work, does not bear examination. They rightly or wrongly approved of that. They advocated that particular view because they believed in it as a sound thing for this country. You may agree or disagree with them but I see no reason for questioning their bona fides. It might possibly be well to remind the House that another Banking Commission, men who were not connected in any way with Great Britain, made a similar recommendation on a previous occasion and I do not think anybody would have thought of questioning their bona fides. There were reasons given in that previous Banking Commission's report which anybody can read if he wishes to do so. He may agree or disagree with these reasons, but at least they were important and weighty reasons.

I have no interest in the banks. I am sorry to say the banks have more interest in me. This Party is not at all anxious to cut down social services. Deputy Norton knows that and in his objective, non-Party review he could not help making Party capital by imputing to this Party views that it certainly does not hold. But we do say that there is a waste going on, not on social services, but elsewhere, and we advocate a cutting down of expenses. Deputy Cosgrave has gone into that fully here and elsewhere. At least he has shown the lines where a lot of expenditure could be cut down and cut down, I believe, with advantage to the country. Much of the expenditure, in officials and otherwise, that has been heaped on by this Government, is not only wasteful, but I believe the purposes for which it is being used are actually harmful to the country. That is why we think there could be reduction in direct and indirect taxation. We do believe and hold very strongly that it is idle—it is silly, I may even say—to talk about the people of this country having to live on the products of our primary industry and our secondary industries and yet make the conditions for a profitable working of these industries practically impossible by all the costs that have been put on the raw material that they use. That is why we object to that. It is because it hits the worker as well as the employer, the farm labourer as well as the farmer, the man employed in the shop as well as the shopkeeper.

I am not willing to prove the phrase against him, but Deputy Dowdall said that we are in a morass. He repeated the phrase a couple of times. I would return to the phrase, not to throw bricks at the Government, but to ask them, as he did ask them, to face what is a serious situation, and a situation that everybody in the country is becoming convinced is a serious situation. We suggested the three ways by which the situation could be met. We suggested the objects, at all events, which the Government ought to have in view. Where is money to be found? We cannot agree that you can go to the banks and take it from them, as some people clearly suggest and have suggested from time to time in this House. They speak of the banks having the people's money. That is most misleading. The banks in this country, the trading banks, to which Deputy Dowdall referred and which he praised, as I understand the matter, are largely trustees for the money of private individuals. Many of those private individuals are not millionaires or rich men. They are the ordinary hardworking farmers in the country. Is the bank entitled, would anybody in a similar position be entitled, to play fast and loose, as some people suggest, with the hard-garnered earnings of these people? It is not the rich people alone who have their money in the banks. Personally, I am, unfortunately, not interested in that aspect of the question. It is the poor people as well; I mean the ordinary people, the farmer who, as a result of working his land, put a little sum of money by, possibly as a dowry for his daughter or for some purpose of that kind. I cannot look upon the bank as holders of national property. They are not. They are holders as trustees of the property of private individuals. What does the Labour Party's amendment mean? What do the social credit people mean?

Deputy Dowdall referred to encyclicals. I know that one of the reports that we may discuss and also an appendix to the Majority Report referred to these encyclicals. I can only give my own view of encyclicals and their purpose. They lay down, sometimes in very definite and strong language, certain general propositions. They condemn, sometimes in very definite language, certain abuses that exist. There is no sparing of language, no indefiniteness, but they do not attempt to do the work of the statesman or the economist. That is my view—it is only my view. Personally, I believe it is the correct view. They are there for a guidance to us in our whole private and public life; but they do not constitute a detailed scheme of politics or of economics and do not pretend to be such. If I may make a comparison, take the Gospels. We do not go to the Gospels for the details of our code of morality. They guide us and they help in the formation of the code and in the shaping of our conduct, but you will not find the detailed code of conduct in them. In the same way you will not find any detailed economic plan or any political plan in any of the encyclicals that deal with economic or political matters— though politics and economics are subject to the general principles laid down. If there was any such attempt on the part of His Holiness to do anything of the kind he would be quickly—too quickly—by statesmen told that that was not his business and there would be a very strong protest on the part of different Governments that he was interfering in purely political matters. The instructions are strong; the principles are definite but to suggest that any plan necessarily carries out, to the exclusion of other plans, the behests of the encyclicals is to my mind a complete misreading of the whole position. Yet they should guide us. They should, as I believe, be before us, not merely before the Government, but they ought to be before the public as well. In a general way they lay down certain general principles for the Government and for the community. I do not believe these two are the same thing. Some people very often think that they are. They are not. If there are certain duties incumbent on the community, it does not necessarily follow that all those duties are incumbent on the Government. I would remind everybody in this House that encyclicals apply to the individual as well as to the Government; that they ought to guide the conduct of the individual as well as the Government, of the employer and the employee as well as the Government. I am convinced, apart from that, that unless there is an effort on the part of everybody in the country to do the best he can, and not the least he can, whether he is a manufacturer enjoying a tariff, or—because you do find black sheep in every flock—a person who draws a salary or wage for which he will give the least work possible, that is not going to help the country.

Easy money, whether that means easy money for the manufacturer with the tariff or easy money for doing nothing, will not save the country. I think the situation is so serious that during the recess all the attention of the Government ought to be devoted to that particular problem. The crisis may not quite merit Deputy Dowdall's phrase when he described the country as being in a morass, but if it is not dealt with and dealt with on sound lines, I am afraid we are going to be in a morass.

Deputy Dillon was quite right when in referring to us as prophets of evil he said we were just a bit too premature. But the danger is there. I am not going to go into the past. I am not interested in it now, but I want to face what this country has to face, and that is the future. Whatever we may say of those eminent gentlemen that presented the banking Report, or signed the minority Reports, this we can say, that they did present to this Government, to this House and to this nation, a very serious problem. There is no good pretending, with that report before us, that there are not serious things to be faced. There are, and the sooner they are faced the better.

I may be a conservative. I never thought I was. I may have cobwebs about my brain, or it may be prejudice —I will admit that. But I have a distrust of easy solutions of complex problems. I think that the Minister for Industry and Commerce to-day more or less tried to get out of answering a question by using a similar phrase. I am glad to see that he is awake to that. This is just one of the few references that I will make to the past: that he, too, had a too simple belief in the efficacy of a simple method for settling the problems of this country—tariffs. His belief was altogether too simple. Perhaps it was natural at the time it was tried. I am not going to go into that, but it was too simple. You do not solve your problems in that way. I would like to be convinced by those who advocate these new departures now put before us and ask us to rub the cobwebs away from our old brains, to show that in trying to remedy one evil they are not creating much greater evils. We have that in every phase of public life. I have referred to it here already. It is referred to in the Majority Report of the Banking Commission.

We are embarking once more, as I take it, on a certain agricultural policy: that is exporting as large quantities as possible of our surplus agricultural products to Great Britain, principally, still, cattle. Now the Government are also anxious to relieve congestion, a laudable object. That, I think, will be admitted. The obvious way to relieve congestion is to split up big farms. Incidentally, I do not think it helps an "objective" consideration of the problem to refer to "ranches". There are no such things in this country. There are large farms. I often wonder whether the Government have considered the effect that the splitting up of these middling sized farms must have on the cattle industry all through the country. The Banking Commission in their Report do not think that they have sufficiently considered the matter. The Commission draws special attention to that. I think we will all agree that if we are to better our position in agriculture it will be by an improved technique, by constantly improving our methods and by getting greater efficiency. The Banking Commission make the suggestion that you are not helping efficiency if you undermine the confidence of the farmer in the hold that he has on his land: that you cannot expect him, in these conditions, to put money into the improvement of his land if he is not sure about the security that he has. They point out—and I am largely in agreement with them as regards its effect anyhow—that the result of recent legislation has been to impair that confidence. I shall not put it any stronger. I do not want to exaggerate.

Here is a case in which our chance of making good economically lies in getting increased returns from our industries—I am dealing now with agriculture—and yet I think Government Departments are pulling different ways. I think one Department is keen on promoting our cattle industry along certain lines; another Department is mainly dealing with congestion. It is quite true that there may have to be a "change over" in our cattle methods. What preparation is being made for that? Again, attention is drawn to that in the report of the Banking Commission—a report which so many people despise. Attention is drawn to this fact, namely, that if there is a change over it will involve capital expenditure on the part of farmers. Where is that to come from? It is on the credit of the country: the credit of the Government to borrow money and deal with the problem in that way, if necessary. But the other way, the facile way, whether you call it social credit or printing notes—call it what you like— surely nobody believes that you are going to do it that way. That way may give pleasure: it may give intense relief for a while—a very short while— but it has brought catastrophe wherever it has been tried. So it seems to me—I may be quite wrong. I cannot say that I have been enlightened by the two speakers who preceded me and who, I thought, were more or less sponsoring this system— Deputy Norton and Deputy Dowdall. It does not seem to me very different from systems that were quite gay for a while, but that ultimately led to disaster, to great heart searchings and a tremendous social revolution not necessarily for the better or for the stability of the country where it occurred.

But we are convinced, and I should like the Minister for Finance to be convinced that, without cutting into social services, economies can be made in public expenditure. A lot of economic services, a lot of the inspection that we go on with at the moment, may have to be scrapped. I think that could be done not merely with advantage to the Exchequer but with advantage to the community. We want a simplification, in the sense of a cutting down and a curtailment of Government expenditure. It is not putting the facts before the people to pretend that all the increased expenditure in recent years has been on the social services— nothing of the kind—and that you dare not open your mouth in this Assembly, where we are supposed to consider matters, to suggest the cutting down of Government expenditure without being told immediately that you are proposing to take a "bob" off the old age pensioners. I think there is wastage, wastage that is not merely harmful to the Treasury but harmful to the nation.

I do not know—I wonder have they considered it—what the attitude of the Government is to the views of Deputy Dowdall. I gathered from his references to the cobwebs which he seemed to think clouded the brains of the Government more than of the Opposition that the Government has not up to the present fallen a victim to his siren notes or those of any of his colleagues—so far as real practical remedies are concerned. But are they not travelling along a road that will seriously interfere with private employment? I do not think they are willingly doing it now. Five years ago if I were asked were they willingly doing it, I might have been more doubtful, but I put it to them that they may be travelling along a road that will seriously interfere with private employment, and that will have the ultimate result of bringing most employees directly or indirectly under the Government. Deputy Norton might approve of that. There were certain parts of his speech in which he did seem to approve of that. So far as our system is concerned—I do not mean only our financial system; I include our political system—I see no cure for unemployment in any real sense unless there is increased production in agriculture, and in some secondary industries.

I know there are two countries—at least two—which make a boast, a boast so loud that I do not think anybody could help hearing it, that they have solved the question of unemployment. One is the Government of the Soviets and the other is national socialist Germany. They may have done so, but I put it to Deputy Norton and others that they have done so not merely because they have control of capital. That is only half of their power. They have done so because they have control of capital and of men, and the control that they have over the men, over the individuals, is quite as strong as the control they have over capital. You can solve unemployment, I am convinced, in that way, but I do not think anybody in this House wants to solve it in that way. Those countries may boast that they have solved unemployment, but they have done so by compelling men to go thousands of miles to work, and to do the work they are put to. I do not want to call that slavery or anything of the kind. There is little good in using words of that sort. But the unemployment problem has been solved in that way. It has been solved because there is control not merely over capital but because there is control over man-power as well. Those two things were essential for the solution in the way in which it has been solved in those lands.

I look for a solution of our difficulties in increased production. That was the policy for which a colleague of mine, unfortunately now no longer with us, always stood in agriculture; that is the late Deputy Hogan. He wanted improvement in production. He foresaw that our keeping a hold on the British market was due and must be due in the long run to the improved and continually improving quality of our commodities. The Banking Commission, years afterwards, makes practically the same recommendation about all our industries in so far as we can hope for exports for them. Coming to the secondary industries they point out that there is no hoping for export where you have mass production. On the whole, I think, under modern conditions, that is true. You may get an export, even under modern world conditions, for certain things that are of an outstanding quality in themselves. Along that line we may have some hopes.

But again, whilst not sharing to the full the pessimism of Deputy Dowdall, I would ask you to consider some of our industries. I am not referring to those for which Deputy Norton is almost as responsible as the Government, and on which he poured I do not know exactly what kind of water to-day. I am not referring to those. Take our agricultural industry. Is it in the condition, from the productive point of view, in which we should like to see it? The Banking Commission pointed out that there were three main factors operating against the healthy condition in which it ought to be— the general depression, the special duties caused by the war with Great Britain, and the policy of self-sufficiency. I would ask the Government to put this to themselves: "How are they going to put it in an ultimately sound position as long as everything the farmer buys either for himself or in the way of raw material for his industry is itself taxed?" As I put it before to the Minister for Finance, how can we keep up the policy of helping every industry? Out of what are we to help them in the long run? If no industry is in the position that, of itself, it can stand on its feet, whence are we to get help? For a while at all events, we shall have to resort, in concealed or other fashion, to the policy advocated by Deputy Norton and Deputy Dowdall when they so openly referred to foreign investments.

It is time that there should be reconsideration of the whole position. After all, the Government has four years of office before it. Anything it does now is not likely to interfere very much with its political position. Is it not possible that it could re-examine the position? I do not necessarily say that they should follow the views I am putting forward, but I say that at least they should thoroughly re-examine the position with an open mind. They came into office with a plan. I am not referring to that plan. Although it might be quite useful for political purposes, and quite relevant too, I put it aside. My objection is that it was no plan; it was a belief, a genuine belief, that by giving tariffs to a number of industries those industries could absorb so many. But I make the suggestion that they did not take into account the disturbing effect that would have on other industries which were already there. It has had that disturbing effect. Although they may have put so many people into employment in those tariffed industries, they have created a great deal of uneasiness, unrest and unemployment elsewhere. That is the danger. It is time that the Government realised that, and reconsidered the whole position in the face of the very serious situation that has been put before them from these benches, from the Labour Benches and from the Government Benches. It is necessary to do so; it is necessary not merely for the life of the Government —I shall not pretend that that exactly perturbs me—but for the life of the State that there should be a full reconsideration of the whole business.

After agriculture let us turn to the other industries. What is the principal industry which far outweighs the other industries which I may call secondary industries? It is the brewing industry. The Banking Commission points out what an excellent industry it is. It gives better employment probably than any other industry. It gives higher wages. Actually, it may not employ more people than other industries, but it pays higher wages. Should not the Government look into the serious matter of the decline of production in that particular industry? There was a decline between 1931 and 1935. There was a decline between 1937 and 1938. Is not that a serious situation? Is there not a problem there? I am taking our principal secondary industry, after agriculture. If the Government are really anxious to deal with the matter of unemployment, surely those two things alone, apart altogether from the abuses that were dealt with by Deputy Norton, show that a re-examination of the whole position is urgently called for, and that no Government are doing their duty if they do not give that re-examination. I do not see, as I said, what the Government have to fear from such a re-examination. They have four years to go in office; they have a majority in this House. Judging from the way in which they have supported very loyally any somersault on the part of the Government, the Government can rely on that majority.

We want agriculture to succeed, not merely on economic grounds, but on social grounds as well. Fault has been found with the Majority Report because it did not deal with the social aspect. I put it to the House that the maintenance of agriculture in a healthy condition is absolutely essential for our economic life and is highly desirable, and almost essential, for the type of life we want in this country. Again and again, I have heard Ministers say, when they were urging their economic policy—and I am sure important members of the Government will be in full agreement with me—that they have no intention of setting up even an imitation industrial England in this country—that that is not their aim. But I suggest that that is what is happening. Whether it is their aim or not to get the people out of the country districts and into the towns, that is what is happening. On that side anyway they are copying England. People are leaving the country districts either for the towns or for England. It is disastrous economically and highly regrettable from the social point of view and from the point of view of the particular ideal we have for our own people.

We are told by some people that really there is no trouble about the problem. I admit that people who speak like that have not yet had the responsibility of government. I think I heard similar statements from certain highly-placed people before they came into office, but at least they have learned that the problem is difficult— I will give them that credit. But, when other people now get up, notwithstanding the experience of two Governments before them anxious to help the country as well as they could and to deal with unemployment, they ought to consider whether the solution is quite as easy as they think. We are told that we have the men, and the number out of work is pointed to; we are told that we have work to be done and that all we want is the money. Where is the work to be done? I am very glad to hear that coming from the Government Benches and Government supporters, because I had the idea that the Parliamentary Secretary to the Minister for Finance has found it difficult to get economic and suitable work. Supposing you do call home all that money from England; supposing in a burst of patriotic ardour, you follow Deputy Norton's lead and cut the cable of sterling, call home your investments, etc., how are you going to use the money productively? I see no difficulty in making the proposition, but I do not think that that is the way in which the problem is to be solved.

I regret that we have made such little headway with the unemployment problem. The number of unemployed is still tremendous. It is a grave problem for the community and for the State. Let us remember that a number of people who are employed are doing work of a doubtfully reproductive character. Let us remember that there are a large number of our people, 100,000, or whatever the number is, living on what amounts to charity. It is given by the State—anyhow it is not given for reproductive work. I am not saying that the State has not a duty to do it or has not assumed that duty; but it is not money given for reproductive work. These are the evils that have to be faced.

I think any reading of any of the reports of the commission should convince any Deputy, whatever arriére pensée he puts into the mind of some of the members of the commission, that there is there a problem to be solved, and it is quite clear from some of the speeches made from the Government Benches that some of the Government Deputies, at all events, and their supporters are alive to the situation. But I cannot accept the position that, when you are in a difficulty, you should take the first plan that is put before you. In so far as I am not in complete agreement with the Labour amendment, in what I consider is the real point of difference between the amendment and our motion, I cannot see anything else but a suggestion of that kind in Deputy Norton's amendment.

The State is bound to deal with this problem, but I have yet to learn that the State, because it is bound to deal with this problem, is bound to plunge into any scheme suggested to it, merely because the author of the scheme says, "That will solve your difficulty." The solution is not as easy as that. I do not think that any country at the present time, whether it is ruled by a Socialist Government, a National-Socialist Government—I do not know the precise difference there is often between them—or by a Liberal Government, or any type of Government, can solve this question of unemployment except by increased production. I am not saying that the economic aim is the chief aim that the community ought to have—I am not urging that; but unless you solve economic problems they will bring grave, moral problems with them. The responsibility is there and ought to be faced.

Deputy Norton spoke of planning. As we all know, the Government had a "plan". I suppose in modern economic conditions a certain amount of planning is necessary. What I am inclined to criticise on the part of the Government is the fact that in reality they had not a plan, as I said already; they have had different plans. I think there is an excellent phrase in the Majority Report of the Commission—"piecemeal-planning". I think that is what has happened. I am not saying it was intended; I am not saying it was inexcusable; but it was not planning. I do not think there was any co-ordinating mind directing, or settling, or bringing into harmony the different phases of the different plans. I think a symptom showed itself and was dealt with. The man dealing with that was satisfied that his medicine would be effective, but he soon found that it only meant further interference, more drastic medicine, and, after that, still more interference. There was no thought-out plan, no co-ordination of plans on the part of the Government. If we are to have planning then I think it ought to be planning. There ought to be some guiding principle and some control. It should not be a case of three or four different horses pulling three or four different ways.

I look upon the way the Government has used what could be a very useful weapon, namely, tariffs, as open to grave doubt. I put it mildly. There again I ask them, in the interests of the nation, not to sacrifice the nation to a doctrinaire belief in tariffs any more than any person ought to sacrifice the nation to doctrinaire belief in free trade. Neither one nor the other should be done. There is very often, I fear, a tendency, once a line of action is taken, to stick to that through thick and thin. I hope the Government will reconsider how far this policy of privilege for one class and then for another can go. How long will that last? It is a serious question when you come to the help of one class, to do so at the expense of some other class, and then when you help that class to find it is at the expense of a third class—and to do the same with individuals within a class. As a Parliament we have come to the help of a number of individuals and made them rich at the expense of the ordinary consumers. Men have had fortunes made for them, not because of any increased skill, ability, or endeavour on their part, but merely as a result of votes passed in this House. The money has come, not from foreigners, but from the ordinary working men, so that when you help one portion of the community you give them privilege against someone else. Even coming to one Department of the Government like agriculture, how does it help nine-tenths of the people in my constituency to put it that way, when they have to pay dearly so that certain farmers elsewhere can grow wheat or beet at a profit with Government subsidy? What help do the great majority of the people get from that? I am not denying that some do get help. What I want to drive home is that there is privilege first for Pat Murphy, then for John Moynihan, and then for Michael Sullivan. Where is it going to stop? Can it stop? These things are worth considering and I put them before the Government for that reason.

Reference has been made to the necessity of cutting down taxation. I include in that a great deal of the concealed taxation. I have often referred to it here, but I saw it much better referred to in another place as private taxation; taxation for the benefit of a private individual at the expense of his neighbour. I am not willing—shall I put it that way—to accept the doleful image that the speech of Deputy Dowdall called up. We are not up to our necks in a morass, but I think we could quickly get into it. We are just on the edge or walking in.

Mr. Moore

The Deputy's own colleague was worse on that.

Professor O'Sullivan

It is a pleasure to see such agreement in different parts of the House. I thought the views of the West and of Cork were represented when Deputy Dowdall spoke. Now we will have the cheerful note from the same cheerful prophet who told us that it was not merely a question of getting Government money for works, but a difficulty in getting suitable works for the money.

Mr. Flinn

There is nothing cheerful about that.

Professor O'Sullivan

It is not very cheerful for the working man. I have given my views on the Banking Commission's Report. They require a certain amount of consideration and should not be lightly rejected. There were other things mentioned in the report. Evidence was given before the commission a couple of years ago as to the necessity of a change over not from cattle but in the type of cattle. What efforts are being made in that direction to induce farmers to bring about such a change? Reference was also made to poultry which at one time was an important export. I believe it was one of our principal industries and that before the setting up of an independent Government here it exceeded Harland and Wolfs. The commission in their report point out that in well-to-do countries a sign of advancing prosperity has been the progress of that industry. They state that in the United States and in England it had improved with the improved standard of living. What efforts are we making to develop along the lines that would improve our position? I am afraid we are devoting a great deal of our energy to twopence ha'penny things.

I do not see any reason why the Government should refuse to accept the motion. I should have gathered, from the Budget speech of the Minister for Finance, that he is satisfied with the first section of it. I do not think a stronger case could be made for the first portion of the motion than to quote the Budget speech of the Minister for Finance. Does the Government really object to any other portion of it? I think they should accept it. I do not know why Deputy Norton in his speech did not explain what he meant by the reference to the national credit. I do not know how anyone could accept the amendment when the principal words in it were not explained. I recommend the motion to the House and if it does not accept it, I recommend it to the serious consideration of the Government.

Mr. Moore

I think everybody was glad when this motion appeared on the Order Paper. We were glad that, at last, we were going to have a real discussion on the report of the Banking Commission, and that, instead of the asides that we heard so insistently, and the frequent references that were used for Party purposes, we would have what Deputy O'Sullivan called an objective examination of the report. That is not what has happened. Deputy Dillon was hardly on his feet when it was evident that his use for the Banking Commission's Report was, to see how far he could get material in it to support his own outlook and the outlook of his Party, to see how far he could use it merely as a Party document. His opening remarks were the strangest contribution to an important debate that I have ever heard. He used for Party purposes the warning of the Minister for Finance, of the terrible effects that a war situation would create here. That warning was given, naturally, for the benefit of the people. It was intended to warn the people that war would not be a help to us, that it would create immense problems, would cut off all imports, would cut off probably the interest from investments abroad, upset our industries and possibly very seriously upset our agricultural industry.

The warning that the Minister for Finance thought it necessary to give— and I think he was very wise to give it —Deputy Dillon turns into material for Party propaganda; he tells us it is a confession of the failure of Fianna Fáil after seven years of office. That is, that Fianna Fáil, in seven years, carrying on a very difficult dispute with a powerful neighbour, initiating immense social work and carrying on the ordinary duties of a Government, was also to be capable of preparing for probably the most terrible catastrophe that the world has ever seen; that it should be able to prevent anything in the way of economic disturbance to this country through the fearful international conflict that is being expected. If that is treating a big subject fairly, if that is treating it objectively, to use the word of Deputy O'Sullivan, well, some of us are hopelessly at sea with regard to the proceedings or the purpose of this House.

Deputy O'Sullivan's speech, similarly, was not a very constructive oration. I thought at least we would hear from him some explanation of the contradictions that are apparent in Fine Gael policy. Deputy Dillon, for instance, warned us that unless the adverse trade balance is corrected there is going to be a crash, and at the same time a great part of his speech was devoted to urging a policy that would have the immediate effect of increasing our imports by a good many millions. He is concerned, as the Banking Commission are concerned, with the position in which our trade exports, plus our invisible exports, are not capable of meeting the commitments on the other side. He tells us that unless that position is put right we are going to have an immediate crash. But he himself wants to add £1,500,000 to our imports of sugar. He has stated that we should wind up the sugar factories —that we should agree to liquidate them.

He has again and again poured scorn on the growing of wheat. That, again, would account for at least two more millions in the way of imports. He claims he has been successful in inducing the Minister for Agriculture to drop the idea of "the mixture," by which imports of maize meal will probably be increased by £1,000,000 this year at least beginning with the autumn. In these there are at least £4,000,000 that Deputy Dillon would add to our imports, yet the Deputy is gravely concerned because our imports are so much greater than our exports. He may say "I would easily balance that with increased exports." If he says that, then he is not in agreement with the Banking Commission, because if there is one thing the Banking Commission was conservative upon it was the possibility of greatly increased exports. He will find in their comments on the evidence of Mr. Twomey that while they were hopeful of some increase of exports, such increase was not to be expected soon and need not be expected to be considerable.

With regard also to the question of increased technical efficiency in agriculture, that has been laboured a good deal by Deputy O'Sullivan and Deputy Dillon, they accepted Mr. Twomey's evidence that there was not much room for improvement in that respect, yet both Deputy Dillon and Deputy O'Sullivan commend such improvement as a lesson to be drawn from the report. I admit that Deputy Dillon has the support of the Banking Commission with regard to the sugar industry, and that is one of the contradictions of that report that I was expecting to hear explained to-day.

The Banking Commission, like Deputy Dillon, were greatly concerned about the adverse balance, the balance of payments, as they call it. They issued several warnings about preserving a correct position in that regard, yet any reference they made to the sugar industry is an unnecessarily scornful reference. One of the words they use in regard to it is that it is unproductive, a curious word to apply to any industry that is responsible for about £1,000,000 worth of goods in one year. They said that the industry is unproductive. What I have often wondered at is in what way the sugar industry is unproductive any more than the dairy industry. It is a fact that we could get sugar from Cuba, Jamaica and places like that very much cheaper than we can manufacture it ourselves, but the same applies to practically everything we use, either in the way of human food, animal food, or anything else.

Mr. Dillon

Nonsense.

Mr. Moore

One of the reasons we changed from oats and barley this year as an animal food is because maize is supposed to be cheaper and it will enable us to feed pigs and other live stock so that we may sell more advantageously in the export market. I was hoping that that curious contradiction in the Banking Commission's report would be explained to-day. It seemed to me, from the gravity of the remarks of the Banking Commission with regard to the balance of payments, that they would welcome any sacrifice in order to rectify the position even a little. Yet there, where there is a substantial sacrifice, where it results in the reduction by £1,500,000 in imports, if any Deputy examines the report he will see how unnecessarily scornful were the references used in regard to that particular industry. It is a contradiction I would like some member of the Banking Commission to explain, because it is totally opposed to the general trend of the report.

There were other things in the Banking Commission's report that I was hoping to hear discussed and defended. There is one thing, for instance, that they exalt to an enormous extent. They apotheosise the external investments, yet not one reference is made in dealing with that question to the enormous sums lost by external investments, the enormous sums lost to this country. There is not a reference to a thing like the Hatry crisis or the various other crises caused by swindlers to whom Irish money was entrusted. One would think, in dealing with a big subject like that, that they would have some warning to make; that private investors—and I do not think it was only private investors who were involved in the Hatry crisis—should at least be warned that there were various openings for their money in England that would not be successful.

There is another contradiction that seems very obvious. The Banking Commission report, after all that apotheosising of external investments, is hardly issued when you have the very people who were most responsible for it, the Currency Commission and the Bank of Ireland, telling the public "we have no confidence, unfortunately, in the present situation; we have no confidence in these external investments. Let us liquidate some of them at least and, even though gold is exceptionally dear, and we will be sacrificing some income in the way of interest on our investments, let us at least have something real rather than have all our money in that form." Deputy Dillon took no notice of that curious development that has taken place since the report was published and he did not see what seems to be the obvious deduction from that fact, and that is that if war takes place in England, instead of these £300,000,000 being an asset to us, they may not be worth the paper on which they are written.

I think there is a very big question there for the Government to consider. What the way out is, I could not attempt to say, but at least you have had the warning both from the Currency Commission and from the Bank of Ireland—both of which were so largely responsible for that report— that they no longer have that confidence that they had a while ago in British investments, at least in the event of war. That is one of the gravest things that is facing us, and instead of Deputy Dillon regretting so much the withdrawal of balances like that for investment here, and instead of the Banking Commission regretting such transfers, it may well be that our regret will be that they were not all withdrawn. It is not a very pleasant subject, because so much is involved in it, and I do not want to enlarge upon it, but I thought that at least there would be some explanation of these contradictions that arise out of the report.

Naturally, the position of the farmer came in for a lot of consideration in the two speeches we have heard. I should like to point out this very big contradiction that seems to be, not merely implicit, but explicit, in the speeches we heard from the opposite benches, not only in to-day's speeches, but in the speeches we heard on the Budget and that we hear on every occasion when there is a general debate. You had Deputy Dillon to-day quoting the figures of taxation following upon the Budget. He then proceeds to examine the hidden taxation, and he calculates that at £5,000,000. Well, when the Government here is arraigned for not treating farmers fairly——

Mr. Dillon

For not treating them intelligently.

Mr. Moore

——there is generally the fact to be reckoned with, that with regard to several of their main products, the farmers have been guaranteed economic prices. The Government have said to the farmers: "If you produce these goods, at least we will see that you will get an economic price: you will be paid for your labour." They have done that with regard to wheat, with regard to beet, with regard to butter, and with regard to bacon and eggs.

Mr. Davin

And milk?

Mr. Moore

And milk.

Mr. Davin

Query.

Mr. Moore

I say milk, certainly.

Mr. Davin

What is the average price?

Mr. Moore

Nobody can say, when he buys a lb. of butter in Dublin to-day, or when he buys it in Ireland generally, that he is paying one farthing more than what is an economic price for the farmer.

Mr. Davin

What about the price of milk?

Mr. Moore

Yet, Deputy Dillon and Deputy O'Sullivan—they who claim to be the friends of the farmers; they who want consideration for the farmer all along the line—keep on insisting on this "hidden taxation". Now, I have always been trying to get an explanation of that contradiction in the policy of the Opposition. I have never yet heard an attempt to reconcile the two things, and I wish to goodness some attempt would be made to do so. I am sure there are very many other Deputies here like myself who find it hard to reconcile these two things and would like to hear from some of those who are going to speak this evening an explanation as to what is in their minds. You cannot have it both ways. You cannot accuse the Government or arraign the Government on the ground that they are not friendly to the farming community or that they are not doing sufficient for the farming community, and then, when they have done the thing that is of most service to the farmers and that, in my opinion, is most appreciated by the farmers, come along and say: "Not only are you taxing the people directly but you are heaping up indirect taxation on their heads." You cannot have it both ways, and I think that Deputy Dillon and Deputy O'Sullivan, in their speeches to-day, were very much endeavouring to have it both ways.

There are very few countries indeed where farming is prosperous to-day, and I think it can be held that in this country, as far as the Government are concerned, they have endeavoured to do as much as any other Government has done, and in fact the remedies that were applied here are practically identical with the remedies that were applied in Sweden, for instance, where, so far from there being any recrimination, there is general agreement that the measures taken by the Government —which, as I say, were almost identical with the measures taken here—are credited with rescuing the Swedish farmer from the worst effects of the depression and enabling him to continue his industry. Again, when people talk about rural emigration here as being phenomenal and as being caused by Government policy or something of that kind, and at the same time point to the great success of Denmark, Sweden, and so on, I wish they would have more regard to the facts. In Monday's issue of the News Chronicle I saw a report that some thousands of farm labourers had left Denmark for work in Germany, and that having got into Germany, they found that the wages they were given there were not sufficient to support them. They tried to get home, and, as they had not got passports, the difficulty in getting home was very considerable and a very ugly situation had arisen. Now, if Denmark, which is organised up to the hilt, and which is often pointed out to us here as a country which we could take as a model—if that situation prevails there, where thousands of farm labourers left for a country like Germany where wages are small and working conditions are very hard, I think it might not be considered so obviously due to Government dereliction of duty that people should leave this country for another country, in order to work in industry, where there are relatively high wages and relatively good conditions.

It would be very much better, in my opinion, if all these things were not made mere Party matters and if questions were considered more on their merits and with a view to finding some constructive line for remedy. You find that in the United States, also, it is calculated that the farmers' income has decreased by 30 per cent. since 1929, and you find that in Czecho-Slovakia, of the efficiency of which we heard a great deal in recent years—and particularly in recent months, when, from English sources, you hear a great deal about the wonderful efficiency and the wonderful charm and the wonderful culture of the Czechs—that, in the short space of 20 years, the rural population has fallen by 280,000 and from something like 55 per cent. the percentage of rural population as to the whole has changed to 32. That is to be found taking place in a country that is supposed to be a model of efficiency, and that was a model of good government, if we were to believe the English accounts that have been so numerous in recent months.

Deputy Dillon made one remark that I think is grossly incorrect. He said the bank managers—he may have said bank directors: either managers or directors—have expressed alarm at the rapidity with which farmers were withdrawing deposits. I happen to know from one bank director, at all events, that, so far from that being the case, the surprise has been in banking circles that, during the depression in farming and during the economic war, the withdrawal of deposits has been very very low: altogether less than £1,000,000.

Deputy Dillon

I believe the Deputy will find that statement made by, I think, the Governor of the Bank of Ireland in the Report for 1938.

Mr. Moore

No, I certainly would not.

Mr. Dillon

You certainly will.

Mr. Moore

My information comes from a director of the Bank of Ireland.

Mr. Dillon

Look it up again.

The Taoiseach

Would the Deputy not look it up himself and support his case by an actual quotation?

Mr. Dillon

I certainly will, when I am winding up the debate; and I think that the Prime Minister will not deny it, because he is too cute.

Mr. Moore

I deny it, on the very best authority.

Mr. Dillon

Yes, but you will find that the Prime Minister will not deny it.

The Taoiseach

I will make no such absurd suggestion.

Mr. Dillon

Well, let the Prime Minister deny it and I will correct him.

Mr. Davin

Deputy Dillon will have the last word this time.

Mr. Dillon

And the Taoiseach will be as circumspect as a cat on top of a wall as a result thereof. The Prime Minister is being warned off.

The Taoiseach

No; quite the contrary.

Mr. Moore

Here is a quotation taken from a book on agricultural economics that has just arrived in the library:

"The decline in the aggregate income of farmers as a group has been general, affecting all countries, but has been greater in the countries which export food. In the United States the purchasing power of farmers' income is estimated to have fallen by 30 per cent. In Germany the farmers' share of the national income has been increased slightly at the expense of food consumers."

May I remark another contradiction? The Government is accused of not stimulating production sufficiently: if they were in earnest about the job, if they were a good Government, they would have increased production more rapidly. How is one to reconcile that with the taunt of Deputy McGilligan when he made one of his rare appearances in the Dáil a few weeks ago, and with the taunt of Deputy Mulcahy also recently, that the Government was supplying cheap food to John Bull? Increased production, I presume, means not merely cheap food, but cheaper food.

General Mulcahy

It is making the people here pay in order that the British people may get food cheaper than we can get it here. What I mean is, that the Government by its policy is raising the price of bacon and the price of butter here, in order that bacon and butter may be pushed over to the British market and sold to the British people at lower prices than the same commodities are sold at here.

Mr. Moore

Deputy Mulcahy cannot be as innocent as he pretends. He knows that the price on the British market is the best price we can get for our exports.

General Mulcahy

Certainly; why should we have to pay a bigger price here?

Mr. Moore

Then the Deputy is in favour of withdrawing the export bonus. He says——

General Mulcahy

I might explain——

Mr. Moore

Allow me to state my case. As I understand the Deputy, he wants butter and everything else, where there is an export surplus, sold here at the price that it fetches in the British market. If butter cannot fetch more than 70/- or 80/- a cwt. in the British market, that is to be the price in this country; if bacon is sold at a certain price in the British market, that must be the price in this country. I understand that to be the Deputy's case, and that if farmers cannot live on those prices, they can go to the wall.

General Mulcahy

The Deputy spoke about the jibes of Deputy McGilligan and Deputy Mulcahy on the ground that we were supplying John Bull with cheap food. I ask the Deputy is it not a fact that the people in this country who are exporting bacon and butter have to pay higher prices than they otherwise would have to pay, in order that Irish butter and bacon may be sent over to Great Britain and sold at a lower price.

Mr. Moore

In the name of goodness, how does that explanation make an improvement?

General Mulcahy

I am bringing the Deputy back to the question of the jibes.

Mr. Moore

I still think that they are jibes. Deputy McGilligan, at least, considered it was good Party propaganda. He as much as says, "I will not be here for a good while longer, and will have a `go' at the Government in a way that will appeal to the crowd." I am sure that was Deputy McGilligan's mentality, but Deputy Mulcahy is surely not so innocent as to think that he explained his jibe.

General Mulcahy

I have explained that the jibe was, in fact, a true statement of the case.

Mr. Moore

I am afraid I will have to leave it at that.

General Mulcahy

I am afraid the Deputy will.

Mr. Moore

One would like to know what it is the Deputy is aiming at. Is he urging that the farmers should be left so that their income should depend on the British export prices, on the prices received for our exports to Britain? Is that to be their position, that, if they cannot live by that, there should be no attempt to compensate them? Is that his claim?

General Mulcahy

I am not saying that I will answer the Deputy at length, but it might do a lot better for the farmers than some of the things tried by the Deputy and which kept the Front Bench so silent up to now.

Mr. Moore

Now, one thing at a time. We would like to settle this question of butter. The Deputy and his colleagues claim to be a farmers' Party and in favour of more and more help for the farmers. He finds fault with the position that the farmers are getting a certain subsidy on butter. If all our butter was to be sold at a certain price—the price obtaining on the British market—butter would not pay and the industry would collapse. Yet the Deputy says that it should be sent out at the Irish producers' expense. Is not that so?

General Mulcahy

No.

Mr. Moore

Does the Deputy hold that there should be no butter exports? If the British will not give us an economic price we are to refuse to trade and we will do without a good deal of the things that we require— oil, tea, and all the things that come into this country. Is that his case?

General Mulcahy

I am glad that the Deputy realises that he has to pay for these things.

Mr. Moore

I am not so innocent that I have only just begun to realise that we must pay for what we get.

General Mulcahy

The Deputy has only just begun to realise that, and that we must pay for the mistakes that we make.

Mr. Moore

I must repeat that I am very disappointed in this debate. I was hoping, from those who apparently gave notice of this motion and who one would expect would read the report of the Banking Commission very carefully—I was hoping that we would hear genuine expressions of opinion from them as to some of the main recommendations of that body. It is singular that up to the present there has been no mention at all as to what they advise should be the attitude towards the two main recommendations: that housing should be suspended and that land division should be suspended. Neither Deputy Dillon nor Deputy O'Sullivan made the smallest allusion to these two questions. Why? Are they waiting for the Government to make a decision on these questions, and then to assail that decision? Why could they not give us the benefit of their thinking on these two matters? They are very big questions for the country, and it would be of great use to us to hear what such important leaders as Deputy Dillon and Deputy O'Sullivan think about such matters.

Personally, I did not intend to intervene in this discussion at all. I hoped that I would have had a day of real education, and that I should be able to hear all these things which have troubled me with regard to the Banking Commission Report explained in the clearest and most lucid way possible, and that I should have no further trouble with that document. So far from that, we got merely a Party reading of it, and a very shallow Party reading, in my opinion. The report is a very valuable one for its facts and for a number of its technical recommendations. It is valuable, too, in the sense that it brings out what, of course, was obvious to those who were directly in touch with things, that we cannot live beyond our income, that we have to pay our way as we go along, that if we get goods from abroad they have to be paid for by goods in exchange, and other facts of that kind. It is very useful so far as it brings out these points to people who have perhaps become a little over-confident and who thought that no such problem as merely paying their way would arise. To that extent, the report is very valuable, but I still think there are many contradictions in it. I am afraid I shall have to wait, but I hope that before the debate closes we shall hear some of these contradictions explained.

Mr. Esmonde

In rising to support the motion, I thoroughly agree with what the last speaker said, that this debate should proceed so far as possible on a non-Party basis and in a non-Party atmosphere, and, in reading this motion, I see nothing in it of a Party character. The object of the motion, as I understand it, is to give this Assembly an opportunity of expressing its approval of certain recommendations made by a non-Party and technical commission, the Banking Commission, and I think it is the duty of all of us here, no matter to what Party we belong, to pool our experience and to pool our brains, so to speak, in order to give support and effect to these recommendations. That, so far as I can see, is the object of the motion. I think it would be very much a matter of regret if this debate resolved itself into a debate in the real sense of the word, with an attempt by each side to score debating points off the other about things that do not really matter. I think we should wake up and realise the serious situation in which the country finds itself at present, and the responsibility which rests on each and every one of us to contribute, so far as lies in his power, to a solution of what is admittedly a very urgent problem indeed. It is no good quoting figures at length. The plain people of the country do not appreciate figures. They realise better than the most eloquent tongue in this House can put it the state this country is in, and it did not require, and does not require, the findings of the Banking Commission to prove that to the ordinary inhabitant. The situation that faces us is that something has to be done to save the country from ruin. We on this side have been called Jeremiahs, and we are told that we have a gloomy outlook on things. We are only taking a gloomy outlook, because we have to face facts. There is no good in going about pretending that we are better off than we are.

The Taoiseach

Or worse off.

Mr. Esmonde

We are not in any way pretending that we are worse off. We say that we must face facts, the facts as found in the Banking Commission Report and the facts which are known to the people, who do not require any elaborate or technical figures to bring home to them their situation to-day and their situation some years ago. I am not concerned with the causes which have brought about the situation. I do not think the debate should proceed on historical lines, or on debating point lines, but I am here as a representative to contribute, in my own humble way, to the discussion in order to find, if possible, some solution of the urgent problem that confronts us. We have only to look at the recent Dublin by-election to realise that, not only the Party to which I belong, and the Labour Party, but all the members of this Assembly, sitting here as a House, are rapidly losing caste in this country. In the first by-election held since the last general election, over 50 per cent. of the electorate did not bother to leave their homes to register their votes for one Party or the other, and they were electors residing in an urban district for whom there was no difficulty in going to the polling booth. It is up to the Government and to this Assembly to try to formulate some scheme that will put an end to the situation which exists and which is known to exist in the country.

I am not a great believer in quoting figures. We have listened to some interesting figures to-day, but there are certain facts which a plain person can understand, facts which it has taken a long time for people in high places to realise, but which the plain people realise. The first fact, and apparently there is not unanimity on it, is that things are indeed very bad in the country. Perhaps I may think them a little worse than other people, but, at all events, a situation has arisen which every Deputy and every Minister recognises calls for immediate action and urgent action on the part of the Government who are responsible for the carrying out of any plan put forward. The second fact is that we are a food-producing nation. I listened to Deputy Moore, who gave us some interesting references to the incomes of members of the farming community having gone down in America, CzechoSlovakia and in other places. I am not in the least interested in the inhabitants of other countries. We should accept the facts that exist here, that we are a food-producing country and that we are producing the type of food which is suitable for and wanted by the people who live in the European temperate zones and climates, and that we have the market ready at our door. That is fact No. 2. Fact No. 3 is that the market, and a willing market, is at our door; and fact No. 4 is that we do not at present supply our market with anything like the quantity of food and produce which that market could take.

These are four simple facts which the people can realise, with, or without a Banking Commission, and they are four simple facts which call, I submit, for some action on the part of the Government to improve the situation here. Before we can improve that situation, before we can increase production and before we can increase the marketing of our goods, there must be a demand for those goods before production. I submit that the organisation of the Ministers and of the Government in this country is all wrong. We have nine members of an Executive Council here responsible for Government policy. One of the nine represents the Department of Agriculture, a Department on its own. I submit that there should be only one Department, a Department of Agriculture and Industries which should be amalgamated together, and that in that Department Agriculture should take the prime place. There should be no two separate Departments of that kind. I submit also that there should be a Department of Exports, and I would amalgamate with that Department of Exports the Ministry or Department of External Affairs, to deal with the marketing of our produce in a specialised and technical way, to create a demand abroad for our produce and the advertising of our produce abroad. And once the demand is there, and has been created, we will not be able to supply in sufficient quantities the demand that would arise.

That is a fact that very simple people can understand. There are parts of the Banking Commission Report which I do not understand myself, but I do understand plain facts. I have come to this House; I do not seek to make any political capital out of the fact that a situation has arisen here as set out in the Banking Commission Report which it is the duty not only of the Government, but of Deputies on this side to deal with. It is our duty not to sit here and debate, but to go out and do something for the people. It is especially the duty of the Government to go out and do something for the people who gave them a mandate to sit and govern here. The Prime Minister laughs. Perhaps I am saying things that sound foolish here within the walls of this House, but they do not sound foolish down in the country where the people of this country live and have to earn their living. If the Prime Minister would go down the country and investigate for himself the situation which exists there he would not be able to keep that laugh on his face—if he could only appreciate what is happening.

The Taoiseach

There is nothing so foolish as some of the statements made by the Deputy.

Dr. O'Higgins

The Deputy is only asking the Prime Minister to carry out his promises.

Mr. Esmonde

The Prime Minister describes my remarks as foolish. I am quite satisfied to accept from the Prime Minister that description; but I stand here as, I hope, an honest Deputy representing his constituency and bringing to the notice of the Prime Minister and of his Government facts which may sound foolish; but I am only stating facts and putting the actual situation in the country before the Prime Minister. Certainly if this is foolish then I suppose I am speaking foolishly here to-day.

The Taoiseach

Who is the actor now?

Dr. O'Higgins

Oh, we will always give the Taoiseach best.

Mr. Esmonde

Now, in putting these facts before the Prime Minister I may be foolish but I am certainly not insincere. However I am willing to accept the charge of insincerity and to admit even that if it would help in any way to make the Government concern itself with matters of this kind. We are dealing with only three-fourths of our country here to-day. Unfortunately a good part of the country is cut away. First of all we should reduce our housekeeping expenses to such an extent that they would conform to that part of the country which exists to-day. We should first of all reduce our housekeeping commensurate with the size of the State in which we live. Owing to the historical trajectory of this nation since 1922 we have assumed the garb—I submit I am foolish again but not insincere—of some major European Power with Departments of this and Departments of that. We are acting as if some of the major European Powers were in competition with us for places in the sun. If one of these European Powers sees fit to increase its armaments we do the same. We are competing with European Powers in the matter of bombing planes and we are expending public money on bombing planes. When I mentioned that matter in a debate here the answer I got was that these were not bombing planes, but light bombing planes. But the Press in the last few days has been full of pictures of large bombing planes in transit over this country at the expense of the tax payers and generally at the expense of the people of this country. I submit, Sir, that we should not try to carry on as if we were some enormous European Power.

There is nothing infra dig or wrong in assuming the garb of what we are, a small and not a very rich country. There is nothing infra dig in housekeeping on that basis, but I am afraid what the Government have forgotten is that we are a small country of insignificant resources. But we are a magnificent country still and one with very unique resources. If the Government will only take time by the fore-lock and accede to the terms of this Motion then there may be some hope. The country is waiting for them to do something but so far they have done nothing. I submit, with respect, that this Motion before the House will give the Government a decent opportunity of bringing forward some scheme for alleviating the situation that exists. If the Government will only do that, this Motion will act as a source of prevention before it is too late.

Mr. H. Flinn

I had thought that a good many Members of this House would have looked forward to this Debate as something which might have removed a good many of the honest doubts and difficulties which challenged Members with cross bench minds which all Parties entertain in this matter. We remember that there was a commission set up, the Banking Commission, for the purpose of examining into a whole lot of fundamental economic facts and conventions in relation to dealing with them in this country. A very great deal of importance and a very great deal of significance was attached to that particular report. A considerable amount of Party feeling was engendered by the suggestion that the very important facts and conclusions arrived at by that report had been kept back from the people. There were very many forecasts, fearful and terrible forecasts, in relation to the nature of the Commission's revelations, its directions and its recommendations. Now, that report has been in the possession of the people for a very considerable time. The conclusions which responsible people would form in relation to it should have now been solidified. I think everyone will have felt some surprise that an earlier opportunity for a formal examination of that Report was not sought by those who are professedly in favour of it. I am quite sure that it was not the duty of the Government to bring it forward, but we certainly looked forward to the day when it would be brought forward and to all the facts, conclusions and coordinations which it contained and which we expected would be brought out as an expression of policy by those who are in favour of the different and very diverse points of view which were put forward in the matter. Roughly speaking, the Banking Commission Report has divided itself into a Majority Report and a series of comments on the Majority Report. The suggestion has been that the Majority Report as such has been approved of by the solid, commercial, educated and conservative opinion in this country.

Therefore we would have been entitled to expect to-day that someone on his feet in this House would have expressed himself as accepting in principle the Majority Report of the Banking Commission. Up to the present I have never met in Ireland a single man who accepted in principle the Majority Report of the Banking Commission. I most certainly have not heard to-day anybody so profess. The central principle of the Majority Report of the Banking Commission is that there shall be no further borrowing, under any circumstances, for any purpose, including housing and the distribution of land, except a directly reproductive purpose. That is the main principle of the Majority Report of the Banking Commission, and, right or wrong, it is a courageous declaration. They put no tooth in it. Under no circumstances—not even for housing or the distribution of land—shall any further deadweight debt be incurred except for purposes which are immediately reproductive. Unless one does accept that principle—it is a principle without any condition and without any reservation—one is definitely turning one's back on the Majority Report of the Banking Commission. I do not want to have any doubt on that subject. They made no conditions, and those who say they follow them can make no conditions either.

Is there a single person in this House who accepts the principle that housing in this country in the future shall be limited to that amount which can be done immediately out of income? Is there any Party in this House that is prepared to declare that it will have nothing further to do with the redistribution of land? If you once say to yourself, "I am going to pick and choose between the things on which immediately reproductive expenditure can be undertaken," and if you are going to say to yourself, "I am in favour of the economical, solid, sound administration of this country in everything except in the things in which I want a different kind of administration," then there is nothing in the suggestion that you are in favour of a sound and economical administration. If one man is entitled to except housing and another man is entitled to except the redistribution of land, then, in turn, every other man in this House is entitled to choose those things which he is in favour of and say they shall not be subjected to that particular test. When the Drainage Commission reports, and when we come to this House and ask, perhaps, for millions of money—deadweight and, definitely, not immediately reproductive expenditure—who is going to get up here and say that he is not going to have drainage done? If one man can choose drainage, another housing, another distribution of land——

Mr. Gorey

They have had a fair innings.

Mr. Flinn

Why should not another man come along and say that, in relation to the rebuilding of the whole school system, he will make an exception? Why should not people whose minds are on the black areas of the West say that, in relation to reconditioning the lives of these people—the best of our people, the people to whom we owe most—they also must be left outside the ambit of expenditure which must be immediately reproductive? On that basis, what I want the House to understand is that there is not in this House, or outside it, or, in my personal opinion, in the membership of the Banking Commission, a single man who, with full advertence to the meaning of that resolution, accepts it in principle and is prepared to carry it out. Before the thing was published, the very people who signed that report were falling over themselves to subscribe, to advocate subscription to and to help the subscription of a £10,000,000 loan—dead-weight capital expenditure.

That being so, we turn from the whole of the majority recommendations of the Banking Commission Report as something which those who signed them either did not know the meaning of or did not mean. We turn away from all their recommendations with the duty on every individual of us to read the evidence and to form our own conclusions as to what ought to be the system of financial administration of this country. I speak as one definitely and openly a conservative in finance, one who does not believe that any miracles can be performed, who believes that hard work and prudence, sound administration, the doing of unpopular things, the facing of difficulties, and only those things, are going to produce results. But I am certainly not going to say that, with all the inequalities in the wealth, station and condition of the people of this country, nothing must be done to help the poor, the unfortunate, or those who carry the heavy end of the log, except what can be immediately done out of this year's income—and done safely out of this year's income.

The second thing that we have looked forward to in this debate was a discussion upon a subject which has disturbed the minds of a lot of people over the world for the last ten or 15 years, and which increasingly has tended to disturb the minds of the people of this country in relation to what is known as a social credit system of finance. At various times Deputies, in this House and out of it, have used what seemed to some of us loose expressions in relation to purchasing power, manufacturing purchasing power and the energising of industry by the use and development of the credit of the State. It is quite possible for people to use expressions of that kind and to know what they mean, and it is quite possible for them to use those expressions and not know what they mean. What would be very important, in my opinion, would be that on some occasion in this House, face to face, men who had different experiences in relation to the crude, ordinary things of life, would put their cards on the table and show what they did really mean, apart from hoping, by ideas of this kind.

Now, it is very curious to relate, but it is true to say, that the biggest impetus towards that kind of thinking in this country came from popular resentment of the basic principle which was laid down in the Banking Commission Report. Its illiberalism, its hide-bound conservatism, its reckless, uncalculated acceptance of the particular principle which I have put before you as its main principle, drove numerous conservatively-minded, quiet-thinking people practically Red in the matter of finance. A lot of people who previously had hardly thought about the subject took that particular line and the result has been that there has been a very large movement of popular opinion in favour of something in the nature of social credit reform.

Now, why I am stressing all that is because I want it to be clearly understood that I do not regard people, who at the present moment are speaking of these things, as speaking with a considerable amount of support amongst the people, but it is far more widespread, far more eloquent, than its merits, in my opinion, deserve. It was for that reason that I looked forward to-day to have those doubts, which some of us have, of the existence of any reality behind an idea of that kind, resolved. I had hoped that when the Labour Party had put down in a formal resolution here "the utilisation of the credit of the nation to stimulate such development", they would in fact have, in a student-like spirit, explained to us what they meant. Now, I think it is literally true to say that they have not attempted to do that. I am not now saying that in any sense of blame. At the moment they may feel that all their spokesmen are concerned with is in making a case for the necessity of something being done, but I think they will recognise that they cannot leave this case here to-day without a full technical explanation of what exactly they mean to do and how exactly they mean to do it. If they give us that explanation, they will be doing something which will be of great service to the House. If they can make clear to the House that some such miracle of this kind can be performed by currency manipulation or any other means, then they will have done a very great service to the cause and the purpose which they regard as the raison d'etre of their Party and the justification for its existence. They will, I think, agree with me that up to the present no such attempt has been made. Certainly, this debate must not end without such an attempt being fully made by them.

Personally, I should very much like to feel that there was some such solution. I agree with my colleague, Deputy Dowdall, when he says that the limit of credit is the production, the available exchangeable production, of the country, and that up to that limit you can multiply credit without any difficulty and without any danger.

Mr. Hickey

We agree.

Mr. Flinn

That is what Deputy Hickey will have a full opportunity of explaining to us later. My personal belief is that there is something to be done as between a restricted and an enlarged currency, but the amount that is to be done is relatively very, very small indeed compared to the things that can be done in other ways. I am deliberately asking for information; I am asking for help. I am speaking as one who, for 30 years, has tried to believe this thing, who has tried to find out some machinery by which it can be done, but up to the present I have not been able to do it. I have read, I think, every authoritative exposition which has been made of this particular theory. Up to the present I have found nothing that is anything but words.

Apart from currency manipulation there is another use, a Governmental use, which is being made of money and which is being confused with the other. I am dealing with it now simply and solely so that the cards on both sides can be put upon the table, and so that there can be no confusion in the matter. Certain countries like Germany and Italy—Germany especially at the present moment—are carrying out a great deal of their government by manipulation of their currency; by the control of money; by the power which the Government has taken into its hands to ensure that no money shall go in any direction except a direction approved by the Government; by systems of internal and external currencies; by restraint of the supplies of money in certain directions. They are doing, through the control of money, a great deal of the things which in other countries are done by legislation. If, for instance, this Government took control of all the moneys, it could say that agriculture shall be stimulated at the expense of industry; it could say that heavy industries shall be stimulated as against light industry; it could say that money shall flow conveniently into tourist development; it could say that money would go into industries that were paying wages of a particular character, or that were employing people of a particular character or in a particular place. In other words, if a government takes into its hands the possession of money, and decides to manipulate that, it can do a lot of things that are being done in the ordinary country by legislation.

But it is an entirely different proposition to imagine that the totality of the wealth of a country or the totality of its production can be altered by manipulation of that kind. I am putting to those who honestly believe something different the difficulties which I have in the matter, convictions which I have formed, deliberately for the purpose of making sure that before this debate ends they, knowing the difficulty of honest enquirers in the matter, will recognise they have the duty and will be able to discharge the duty of explaining what has not yet been explained— what they mean by "the utilisation of the credit of the nation to stimulate the development of industry."

Returning now for one single moment to the main proposal of the Banking Commission Report: that we must live in everything for the future on our immediate income; that expenditure must come down, all I can say is that if you could find agreement in this House in relation to anything in which expenditure could be reduced there would be an amazingly strong case founded on that agreement for reducing that expenditure whatever it was. I have never seen a sign of agreement of that kind. You are in precisely the same position if you go to the people who are in favour not merely of that wide principle but of the general atmosphere of the majority report. Some years ago the Associated Chambers of Commerce or their representatives solemnly met in Dublin for the purpose of considering the Budget before the Budget was introduced. They decided to go on a deputation to the then Minister for Finance, to ask him to reduce expenditure and taxation. Some very kind and sensible member of their body said, "Well, that is the sort of thing that has been said a great number of times to a great number of Ministers for Finance but if we as being probably the most responsible commercial body in the country were to go to him with definite recommendations as to what should be reduced or, if in relation to any particular tax which had to be taken off, what tax we would substitute for it, I consent. It would have an enormous effect and influence." That was agreed but, after an hour's discussion, they decided to go to the Minister for Finance and simply ask him to reduce taxation.

Until you can get out of that, until you can reach a stage in which there would be agreement, not merely that too much of the income is being taken by its government for the purpose of carrying on the corporate works of the people, but agreement as to the things you do not want done, you are not likely to get any further. What this country wants, in my opinion, is not so much emphasis on reducing expenditure but emphasis on getting value for all the expenditure. I think there is more room for effective saving, more room for reducing the burden on the community of corporate work in the mobilisation of public opinion behind the slogan: "Value for every penny of Government expenditure," than there is for any other slogan that I know. Those who want a sound economy in this country will, I think, find it along those lines and I invite them to mobilise along those lines.

Again, and in conclusion, I would say to those who believe that there is some other form of currency control which has in it magic possibilities for the betterment of this country, that their duty here to-day, having themselves challenged the issue, is to expose their hand, to tell us exactly what they mean and give us an opportunity of examining its merits.

Dr. O'Higgins

I rise to take up very few minutes of the time of the Dáil on this particular debate. I do so in order to express both surprise and my protest at the particular way in which Parliament is being treated on such an important occasion as a debate of this kind, a debate which was specially invited by the Taoiseach himself when speaking on a previous occasion in this House, a debate dealing with such grave matters as the incidence and weight of taxation, the pressure of debt, unemployment and the general financial stability of this country. I think it is an insult to the Dáil and callous disregard of the people outside that a debate of this kind should have gone on for nearly six hours and that no member of the Government has intervened in order to state Government policy or attempt to put a case for debate before the Dáil. It is a definite and blatant shirking of the responsibilities of office. It may suit everybody to get the last word but, attached to every office, there are certain very definite responsibilities. Never before have I seen responsibility shirked in the manner in which it has been shirked to-day. Two Deputies from this Front Bench have spoken. The Leader of the Labour Party has spoken. A number of Deputies from different Parties have spoken but neither the Taoiseach nor any of his Ministers has so far intervened.

It might suit everyone of us to have the last word: by having the last word to get the better of an argument. But Government office carries certain responsibilities, and early intervention in a debate of this kind is certainly one responsibility. We had a Parliamentary Secretary just now giving us a long exhibition of shadow-boxing, fighting or attempting to beat down a non-existent case: trying to pretend that there was something either in the motion or in the amendment directly advocating social credit, and devoting the whole of his speech to a laboured attempt to mislead the public as to what is demanded from the Government.

What is demanded from the Government in the motion is to reduce direct and indirect taxation: to endeavour to curtail or slow down the pace at which the deadweight debt is increasing. In the amendment there is a demand that the credit of the country be more sensibly utilised towards reducing the growing masses of unemployed people in the country. With all that before us, the nearest thing we had to a Government spokesman has just sat down. I certainly say this definitely: that during all the time he was on his feet he directed attention neither to the motion nor to the amendment. The man who directed all his energy in an endeavour to mislead the country as to what was demanded either in the motion or in the amendment is—it is hard to believe it—an individual who sprang into fame and notoriety as the father of a plan for no income-tax in this country. Politics certainly makes strange bed-fellows. It also extracts strange confessions, but I think the strangest evolution that has been produced in this country inside the last 20 years is the development, from an embryonic non-income-tax advocate, to a stalwart of heavy taxation. He has had the audacity to throw out a challenge to other Deputies as to what suggestions they have for a reduction of taxation, and he was not interrupted by anyone suggesting "No income-tax". But it would be very obvious—"No income-tax"—if we were given to interruptions.

This Report of the Banking Commission was published nearly 12 months ago and, without exaggeration, this at least is true, that danger signals were flying in every second chapter of it. Things, to say the least, were not healthy and were not satisfactory when we found it necessary to appoint a commission to inquire into all the matters dealt with. But having appointed a commission and got a report of a very grave nature, one would expect that the Government itself would take an early opportunity to bring that report before the Dáil and have it discussed. And yet, it is only when a motion is put down by the Opposition that we get, at the very tail-end of a Parliamentary session, rather grudging permission to have it discussed, and when the opportunity arises for discussing it we have a blank wall of studied silence on the Government Front Bench as deliberately offensive as it is callous.

Now, it may be that the Government case is this: that circumstances are such that they see no prospect of an avenue through which they can reduce taxation. If that is their answer that case has got to be made, and not the frivolous type of question that we get from the Parliamentary Secretary as to where you would reduce taxation, how, and off what. If the Parliamentary Secretary paid more attention to the proceedings of the Dáil, beyond coming in here when the bell rings for a division, he would not have to think very hard to remember that on occasion after occasion the expenditure of public moneys was opposed by the various Parties in this Assembly. The last occasion was when the proposal was for the expenditure of many millions of pounds on the production of a ground army, of heavy bombers for the air, tanks, etc. The question was put at the time, if this is purely an army for defensive purposes in this country, and not offensive purposes elsewhere, why do we want all the paraphernalia of an army about to invade another country? We regarded that at the time, and stated it at the time, as a sheer waste of public money. We opposed all the expenditure, rightly or wrongly, and now we have had the twittish type of speech that has just come from the Parliamentary Secretary as to how money could be saved or what proposal we ever made for the saving of money. We had a huge, unequalled demand for new taxation to meet new expenditure, the demand coming in two directions, to meet it immediately out of revenue for this year; and a proposal to increase the public debt of the country to meet demands from that quarter. We opposed that, and new we are asked by the Parliamentary Secretary did we ever make a proposal to reduce taxation, and did we ever agree on economy in any direction. Every fourth spending measure introduced by the Government has been opposed, but the bell rang and the majority was against us.

That commission sat and its report was issued at a time when every possible means of abstracting taxation from the people had been utilised to the full; when income-tax has gone to a figure unequalled in times of peace in this country, when it has got a sudden jerk of an increase of 1/- in the £; when indirect taxation has been carried to an extent that years ago anybody would consider impossible in this country. When, in order to meet the growing demands of a Government prone to spend, we have reached the point where we cannot exempt from the tax gatherer's rake even the poorest pauper in the country, when tax after tax has been clapped on the immediate necessaries of life in the poorest homes, and when we have a motion down to discourage or deplore that set of circumstances, we have that motion debated for six or seven hours and complete silence from the Government Bench. On public platforms neither the Taoiseach nor any of his Ministers is so very reticent as they are in this Assembly. When an opportunity is given for making a speech and there is no opportunity to reply, then they are all very vocal. When it is a case of making a promise, or stating that there is a plan for this, that, or the other, then everyone of them is very vocal outside this Assembly. But in here, where the plan should be implemented—if it exists—the plan for lowering taxation is in practice a plan for rapidly increasing taxation month after month and year after year.

That report deplores the rapidly mounting deadweight debt and rapidly increasing taxation. The motion deals with the cruel indirect taxation as well as the direct taxation. The amendment deals with the growing unemployment in this country. It is my opinion at all events that the whole thing is a senseless vicious circle. We increase surtax, we increase income-tax, we increase rates, and we justify all that by talking glibly about social services. Because of the increasing overhead charges in any particular industry, we force economy at the other end. The result of all the increasing taxation is increasing unemployment through the dire necessity of economising in some direction in order to meet the exorbitant demands of the Government on taxpayers. When we have a situation like that, and when we have a report calling attention to these things, and when we have a motion inviting the Government to express their views, to state their plans or name their intentions in view of that dismal picture, we have the Taoiseach adopting the role of jovial interrupter. We have his Ministers beside him silent, and in the course of six hours we have no Government spokesman except an individual put up to make a speech against a non-existent motion. I wonder at times if the Government have ceased to take their responsibilities seriously, or if they ever commenced to take their responsibilities seriously.

We are debating this motion in a country whose export trade in agricultural produce alone has fallen from something in the neighbourhood of £35,000,000 to considerably below £20,000,000 a year, and we are facing that situation at a time when the Minister for Finance introduces a Budget and tells us that if war breaks out in Europe the position in this country will be so serious that it will be a case of tax all you can where you can. When we have Government Deputies—not Opposition Deputies— one after another getting up and sounding a note of warning, telling the Government that if things are not altered within 12 months or so the position will be really desperate; with our export trade shrinking so rapidly that one can almost say it has gone; with unemployment reaching an apalling and unprecedented figure; with direct taxation gone to a figure beyond the recollection of any living man; with indirect taxation carried to such a fiendish extent that no labourer can call his wages his own; and when there is an opportunity for discussing all those things, and when criticism is levelled at that state of affairs by one speaker after another from different quarters of the House, we are met with deliberate, studied, Government silence. As one Deputy in this Assembly, I wish to record my protest against the manner in which the Dáil is being treated. Sooner or later—when it was not done sooner, then let it be done later, at the end of the Government's seventh or eighth year in office—I would invite the Ministers to begin to face up to their responsibilities even when it is a bit awkward. One way to make at least a beginning is by not sitting silent— by not remaining open to the brand of moral cowardice and clever political trickery through sitting hour after hour in face of a motion and amendment such as we have here.

Two Deputies rose.

Mr. Dillon

Minister! Minister!

Minister for Finance (Mr. MacEntee)

The Minister would have risen in this debate long ago if those who were responsible for the motion and those who were responsible for the amendment had stated to the House the reasons which drove them to the conclusion, in the first place, that it was necessary to reduce the burden of direct and indirect taxation, and to restrict the creation of further deadweight public debt. I should have risen earlier, perhaps, if we had heard from the Labour Benches a reasoned speech in favour of their amendment. We had a long, prolix, turgid statement from Deputy Norton, who did not adduce any figures to prove his major premise that the reports of the Banking Commission indicate that there is now a serious depression in agriculture. It is quite true that, when this report was being drafted, not merely this country but agricultural and manufacturing countries the world over were just emerging from a very serious economic depression. Super-added to that we had the difficulties occasioned by the dispute with Great Britain, and undoubtedly those factors weighed very heavily with those who were responsible for drafting not merely the report signed by the majority of the Banking Commission but with those who were responsible for drafting the three Minority Reports as well.

But I think that any student of the Reports, and particularly any person who presumes to base his case in this House upon the words of the Majority Report, ought, in fairness, to have submitted to the House what were the causes to which the signatories to that Report ascribed the depression in Irish agriculture. As it has not been done, I should, perhaps, read what the Majority Report does say on that head:

"Before the agricultural depression set in, about 45 to 50 per cent. of the gross output of Free State agriculture was exported. In 1935-36, under the influence of the depression,"—the world depression—"the financial dispute with the United Kingdom, and the policy of replacing imports by domestic production of wheat and beet, and other products, only 34.4 per cent. of the total gross output was exported...

"The three main factors to be considered are, as just said, the following:

"Firstly, the agricultural depression, which began to make itself felt in 1928 in a drop in the price of wheat in the world markets, and in 1931 began to affect, also, prices of foodstuffs of animal origin, has, in the Irish Free State, as in most other countries, including the United Kingdom, given rise to some measures of Government action for the assistance of agriculture.

"Secondly, the financial dispute with the United Kingdom, of which an important feature is the imposition of special duties by the British Government, has led to the granting of subsidies in aid of Free State exports and has also in other aspects affected the country's agriculture."

It is quite clear from that that any references contained in the Reports of the Banking Commission to the serious depression in agriculture—and it is upon such references that the case, for the amendment, at any rate, has been made—referred to transitory causes, and causes which, in one respect at any rate, have completely ceased, and, in the other, are rapidly passing away.

Mr. Dillon

The report deliberately denies that.

Mr. MacEntee

What does the phrase "depression in agriculture" usually connote? In its usual acceptance it would appear to describe a state of affairs characterised by a considerable reduction in the incomes of persons depending upon the land.

Mr. Dillon

On a point of order. The Minister has purported to read from the Banking Commission's Report. The extracts which the Minister has read from the report represent one-half of paragraph 74 of that report. The second half of that paragraph, which he has not read, specifically says that for the purposes of their study—

An Ceann Comhairle

That is not a point of order. Any Deputy or Minister may quote as much of any official document as he cares. The Chair has no control.

Mr. Dillon

On a point of order——

Mr. MacEntee

You having ruled, Sir, I presume I may speak.

An Ceann Comhairle

There is another point of order.

Mr. Dillon

I am raising another point of order. Is it proper for a Deputy or Minister to read a paragraph from an official document in a mutilated form calculated to deceive Dáil Éireann as to the contents of the quotation?

An Ceann Comhairle

As the Chair stated in first replying to the Deputy, Ministers or Deputies may quote as much as they desire or as little as they desire of any report or document.

Mr. MacEntee

I was saying that the causes to which the decline in agricultural incomes are attributed in the Majority Report have now largely disappeared, and disappeared because of the ending of the economic war by the signing of the Agreement with the United Kingdom, to which Deputy Norton, who deplores the depression in agriculture, took such voluble exception when he was on his feet. Having now ceased, because of the ending of the economic war and the lightening, during the past two years of 1937-38 of the world depression in agriculture, we now find that our cattle exports, which amounted in value to £2,361,000 in the period from January to May, 1936, have risen to £3,792,000 in the corresponding period of the present year. That certainly does not indicate any decline or any diminution in farmers' incomes, and it does not indicate any intensification of the depression in agriculture, which, admittedly, existed to some extent in the year 1936.

Mr. Gorey

Perhaps you will give us the figures for 1932.

An Ceann Comhairle

Deputies must give as good a hearing to the Minister as they expected and got.

Mr. MacEntee

Not merely, however, have there been increases in the value of our cattle exported, but we have also increases recorded in the period January to May over the values in the same period last year in exports of milch cows, sheep, lambs, pigs and horses. The total increase in the value of the live animals exported in this period has been no less than 34 per cent. Perhaps I had better give the full figures for the value of the exports of live animals in the years 1935 to 1938. In the year 1935, the value of the animals exported came to £7,316,000; for the year 1936, it was £8,952,000; for the year 1937, it was £9,803,000; and for the year 1938, it was no less than £11,958,000.

But it was not merely in regard to our exports of live stock that the value of our export trade went up. We had the same tendency manifested in other principal agricultural exports. For instance, within the period January to May this year—I am giving the latest figures available—the export of bacon and hams came to £826,000; in 1938, that is last year, within the same period, the export amounted to £699,000; in 1937, the year previously, it was £620,000; and in 1936, it was £614,000. So that there has been an increase of over 33? per cent. in the export of bacon and hams within the first five months of this year as compared with the first five months of the year 1936.

Mr. Dillon

Give us the figures for pigs.

Mr. MacEntee

I had better give the total figures for the year in regard to bacon and hams. In 1935, the total export was £1,427,000. For 1938, the value of bacon and hams exported from this country had risen to £2,257,000.

Mr. Dillon

Give us the figures for pork and pigs.

Mr. MacEntee

I shall give a lot if I am only permitted to talk without interruption. The total exports of butter in 1935 were valued at £1,658,000; in 1936 they had risen to £1,917,000; in 1937 they had fallen to £1,589,000, but last year exports totalled £2,159,000, an increase of almost 33?% over the figures for 1935. The export of eggs during the first five months of this year amounted to £732,000; in 1938 to £614,000; in 1937 to £527,000; and in 1936 to £613,000. For the whole of 1935 they amounted to £995,000, and for the whole of last year to £1,176,000. These are not reckless statements. These are figures which I can stand over and which no one can controvert. We are not talking now in exaggerated terms of the poverty that exists here and there or using wild generalities. These are figures which show that there has been a continuous improvement in the position of agriculture and agriculturists over the years 1935 to 1939. They are the only sort of arguments that should be used in a debate of this sort where, presumably, people want to talk in terms of £s.d., because it is in terms of £s.d. of a fixed standard of value that the condition of the people can be most concretely expressed. To sum up, by giving a comprehensive total for the value of agricultural exports in the four years which we have been considering, we find that whereas in 1935 they amounted to £13,834,000, last year they had risen to £19,657,000 or had gone up in value almost 50 per cent. I should say also that the agricultural price index for 1938 stood at 111.9 and was higher than it had reached here since 1930.

Let us consider it from another point of view. We were told of the impoverished condition of our herds, and that they had shrunk. The figures do not show that. The last inventory up to June 1st, 1938, showed an all-round increase over 1937 in the live stock population, which had gone up by 2.6 per cent. The number of sheep went up 6.8 per cent., the number of pigs went up 2.6 per cent., while horses went up 2.9 per cent. In face of this evidence of improvement in the agricultural position, surely there is no justification for the major premise, on which the Labour amendment is based, that there is an aggravated depression in agriculture here. On the contrary, as I have shown, there has been a continuous improvement in agricultural conditions here over the past four years.

Let me get back to the motion. I presume it is intended to be taken seriously. We had a very eloquent speech from the proposer of the motion. I think it would have been a much more practical speech if it had been more closely related to the motion. I presume the terms of the motion were thought by those who put it down to be worthy of serious analysis. Let us see, therefore, what this motion that we have been discussing for the past six hours does in fact say:

That the Dáil is of opinion that in view of the contents of the Majority Report of the Banking Commission steps should at once be taken——

to do certain things.

Surely that presupposes that those who put down the motion made a careful and a critical study of all the reports of the Banking Commission, and that, for reasons which to them seemed well-founded they have pinned their faith to the recommendation set out in the Majority Report. At least, if they wanted the matter seriously discussed they would have given us the arguments in the Majority Report which led the members of the Opposition Party to these certain conclusions. What reference did we hear to the Majority Report from the proposer of the motion? We were told that there is in the Banking Commission's report abundant material to examine. Undoubtedly, there is in the Majority Report abundant material to examine, material which, no doubt, was accurate at the date it was given, but which is long out-of-date, as the figures I have quoted, showing the trend of agricultural production in this country over the past four years, amply testify. Much of the information available in the Majority Report is completely out-of-date by reason of the fact that what was, perhaps, if not the major cause, at any rate, a very weighty factor in the depression which we endured here from 1934 to 1937, has completely disappeared, and we have now the British market upon better terms than our farmers ever enjoyed that market before. In the light of that, all the figures set out in the report would have to be reviewed, revised and considered anew.

There are a great many recommendations in regard to what I might describe as the mechanism of our financial system, and particularly in regard to governmental accounting and public finance which, perhaps, do not need much revision even in the light of the changed situation. But apart from these there are statements of economic facts which no longer hold. Undoubtedly, a great many of the forces which impelled the majority of the members of the commission to make drastic recommendations, in regard to certain features of governmental activity, have disappeared, and the situation, in my view, is not at all as grave as it might have appeared to those who made the recommendations generally referred to in the years 1936 and 1937 when, I understand, the report was drafted.

It has been suggested that the Government has been unduly dilatory in making up its mind in regard to the recommendations contained in any of the reports of the Banking Commission. I do not know whether Deputies really have done more than look at the covers of the reports, or simply skimmed through them in the hope of finding some statement which would be useful to them as political ammunition. Certainly, there was no indication given by any of the speeches we heard from the Front Opposition Benches whether from the proposer of the motion or those who supported him, or by the speech of the Labour Leader, who was responsible for the amendment, that the Report of the Banking Commission and the appendices and the addenda had been seriously considered by them. Let us see what really the Report of the Banking Commission does represent in terms of material for investigation and consideration.

The Majority Report, as has already been indicated here this evening, is not by any means a completely self-contained document. There are appended to it four addenda by different members. They are not addenda dissenting from the main report. They do relate to matters which those who prepared and signed the respective addenda felt had to be dealt with at some greater length than in the report. But they are not, in the main, inconsistent with the recommendations of the report and, therefore, there is no point in a person who is presumed to hold a responsible position in the Labour Party—whether the presumption is too great for ordinary acceptance or not, I am not going to say—one who is presumed to hold a responsible position in this House as a leader of one of the principal Parties —there is no excuse for him to use the sort of slick trick-of-the-loopery he did when he alleged that this report has been signed by ten members of the commission. It was signed, not by ten, but by 16 members.

Mr. Davin

Is the expression used by the Minister a parliamentary expression?

An Leas-Cheann Comhairle

It was not used in a personal sense.

Mr. MacEntee

It was not used in a personal sense.

Mr. Davin

It is scarcely one that would be used by a gentleman, a Minister.

Mr. MacEntee

In addition to these addenda, there is one note by another member of the commission who signed the Majority Report, and there are two separate reservations relating primarily to the question of housing and the question of land division by yet two other members. Apart from these reservations and addenda, there are 32 appendices to the Majority Report and, while a number of these may be purely statistical, there are others relating to the census of production, national income, social credit, Papal encyclicals, central banking, and the effect of State action on commodity prices, all of which call for individual consideration in relation to the main report. I am not for a moment suggesting that there is not in the Majority Report a complete set of recommendations, but it must be quite clear to any person that a final view can only be formed of these recommendations after a full examination of the addenda and appendices, which cover over 200 pages and, in addition, a full consideration of the three minority reports, two with appendices; and not merely that, but, as the Parliamentary Secretary, Deputy Flinn, has pointed out, in addition, the evidence taken before the commission must also be carefully considered in conjunction with the reports and with the evidence, which alone fills two half volumes.

That has to be done, and not merely that, but, as these recommendations affect a very large number of Government Departments and a very large part of the general machinery and operation of government in this country, it is quite clear that a considerable period of time must elapse before they are even put in form for consideration, with the necessary observations of the particular Government Department concerned and data and the necessary collation of all the various aspects that have to be considered by any Government in relation to any major matter. Before all these things are in form for our consideration, it is quite clear that a considerable period must elapse and, whether for good or ill, I think people must take this point of view in regard to all the very valuable work that we cannot accept it as Holy Writ. When I say that I am not for one moment inclined to decry the work of this commission and all the very valuable work done by all the members of the commission, in trying to express certain points of view, trying to secure for us data which are necessary. This commission has undertaken—I can say it, and I think it will be generally agreed—the first thorough survey of our economic resources, of our economic structure and conditions, that has been made here, so far as I know, within historical times.

I am not going to decry the immense value of the work done by these gentlemen. There is no person who would be prepared to pay a higher tribute to them than I, but I am not going to take, and I am certain my colleagues in the Government, and the members in the House, and the general public, are not going to take the members of the Banking Commission as working under the afflatus of Divine inspiration. They are just human beings, whose conclusions may have been well-founded in some respects, but whose conclusions in other respects may be completely erroneous, and it is our duty to give to the recommendations which they have made the same careful study which they gave to the facts upon which they based those recommendations. When we have done that, we will be in a position to put before the people a policy, based upon the study of these reports, which we can confidently recommend to the people and which, I am sure, the people will be prepared to accept in these circumstances.

I would like, again, to draw the attention of the House to this very peculiar motion. It states here "That the Dáil is of opinion that in view of the contents of the majority report of the Banking Commission steps should at once be taken..." It is quite obvious that that motion has been worded in such a way as to lead the people outside to infer that the members of the Opposition have adopted and accepted the recommendations of the Majority Report. But that is not written down here in this motion, and it is not upon what people outside might infer, or might be led to infer, from the sort of speeches we have been listening to and the sort of agitation that has been going on in the Press which supports the Opposition Party, and upon certain platforms which they sometimes grace, ever since the report of this Commission was published, that the House is going to divide. The division upon this motion is going to be taken, not upon the merits or demerits of the Banking Commission Report, either of the Majority Report or any of the minority reports, but it is going to be taken upon three specific things, all of which must be taken together. There are not going to be separate divisions on No. 1, No. 2 and No. 3. The whole lot have to be taken as one collective whole. The first thing that this House is asked to do is to take steps to reduce the burden of direct and indirect taxation. I would like to examine that in some detail.

Mr. Dillon

You have just an hour and ten minutes.

Mr. MacEntee

First of all, it is quite clear that whoever drafted this motion did not guard against ambiguity. We have two phrases used here in direct juxtaposition, in opposition to each other—direct and indirect taxation. What was really meant, perhaps, was that the direct taxes, the taxes upon individuals per se, such taxes as income-tax and other taxes which were supposed to fall immediately and directly upon individuals, were to be reduced, and that, at the same time, taxes which fall directly and immediately upon commodities, and only fall indirectly upon those individuals who use commodities, were to be reduced, but I gathered by the speech that was made by the mover of this motion that that was not what he had in mind, but that what he did imply by direct taxation was that all taxes, whether direct or indirect, were imposed and collected by the State for the purposes of the Exchequer. I hope I am right in that assumption.

Mr. Dillon

Is the Minister inviting me to interrupt him? I shall be glad to do so at some length, if he wants me to interrupt him.

Mr. MacEntee

I know that the Deputy is always glad to talk at length on any subject, but we are not always quite so eager to listen to him. What do we mean, however, when we say that, in the opinion of this House, the Government ought to take steps to reduce taxation? I do not suppose it is necessary for me to say to any member of the House that taxes are only collected for one purpose. We do not collect taxes merely for the sake of despoiling the citizen or in order to appropriate the taxes to our own personal use. We collect taxation here for the purpose of maintaining the public services, and therefore, when a Deputy gets up and says that, in the opinion of this House, taxation must be reduced, what he means, in fact, is that, in his opinion, and in the opinion of those who support him, certain public services ought to be curtailed. There is no way, to my mind, at any rate, in which taxation can be significantly reduced unless you curtail certain public services—at least, as far as I know. Of course, you may make minor economies here and there. You may cut down staff—some superfluous staff, let us say, in this Department or in that—but I do not think that the Government services, as a whole, are largely over-staffed. There may be occasional redundancies here and there, but it must be remembered that there is not the same freedom of action in connection with a Government Department as there is in connection with a private undertaking. Therefore, as I say, you may have redundancy occasionally in certain Government Departments, but on the whole there is no great redundancy, and, therefore, there can be no great economy effected, or any great reduction in taxation, unless you curtail certain public services, and not merely curtail certain services, but curtail the larger public services—those which involve the greatest expenditure—somewhat drastically.

Now, let us see what the position is in that regard. I am prepared to make this concession to Deputies, and particularly to Opposition Deputies, that, as compared with the year 1931-32, there has been an increase in taxation amounting to £4,701,000. Let us see where we are going to try, accordingly, to effect the reduction in expenditure that would be necessary to enable us to revert to the position of 1931-32. It is essential that the public should know what is involved in this cry to reduce taxation, because I am going to suggest to Deputies who ask the Government to reduce taxation to tell the Government how, in their opinion, expenditure ought to be curtailed in order that taxation may be reduced.

Mr. Keating

What plan had you before 1932, when you were going to reduce taxation by £2,000,000? Can you go back to that plan?

Mr. Gorey

Yes, the Minister might get some inspiration from it.

Mr. MacEntee

Let us take the Services, one by one, and I am going to ask the House to grant me some indulgence because I want to have this matter cleared to the bottom.

Deputies

Hear, hear!

Mr. MacEntee

Let us take the Central Fund services first. For last year the expenditure thereon amounted to £4,850,000, and of this £2,210,000 was for the service of debt. We have heard something in this discussion about the deadweight debt, and we were told by Deputy Dillon, who was very eloquent, that we were tottering towards bankruptcy and that, shortly, we were going to find ourselves in the position of Newfoundland or even of New Zealand; but what is our position in regard to the debt charges in 1938-39 as compared with 1931-32? I have given the House the figures for the year 1938-39—£2,210,000—but in 1931-32, this halcyon year on which Deputies opposite used to be harping back, the charge for the debt services amounted to £2,065,778; so that, notwithstanding all that we have heard from Deputies opposite, and notwithstanding the black picture that has been painted of the state of the public finances, we find that the amount which our people have to pay in respect of past expenditures has only increased by something less than £145,000 per annum over seven years, and the sum and substance of all this cry about the deadweight debt charges has been that it has increased at the rate of £20,000 per annum. Surely, nobody is going to say that that is an alarming weight for a community so progressive as our community, from the statistics which I gave for agricultural production, is shown to be.

Deputies, however, have grounded their demand for the reduction in taxation upon, apparently, their view of the Majority Report of the Banking Commission. How do Deputies think we are going to reduce taxation if we are to give effect to the recommendations of the Majority Report in regard to debt services? So far from that report suggesting that we are making an ample provision—and I think that we are not making an unduly small provision—but so far from the Majority Report suggesting that we are making an unduly large provision for the service of debt, they want us to make an even larger provision, and yet Deputies who, apparently, clamour that we should accept the recommendations of the Majority Report, and consequently impose additional taxation in order to make further provision for the debt charges, in the same breath tell us to reduce taxation. Now, which do they want to have? If we are going to give effect to the recommendations of the majority in regard to the debt services, we must increase taxation and increase it considerably. How do Deputies want us to do that and at the same time reconcile it with the demand to reduce taxation?

The next largest item in these Central Fund services is an amount of £1,162,000, which is represented by payments to the Road Fund. That is merely the handing over to the Road Fund, with certain exceptions this year and in two earlier years, of the amount that is collected by way of the motor vehicle duties.

Then we come to the next largest individual item, which is a sum of £599,000 in respect of the agricultural grant under the Local Government Act, 1898. Now, those who have put down this motion have been clamouring here in this House, that not merely should we provide this £599,000, but that we should provide almost another £2,000,000 in order to complete the derating of agricultural land. How will they reconcile their attitude to-day in regard to the reduction of taxation with their attitude during the last general election, when they were soundly defeated on this question as to whether we should in fact impose additional taxation to the tune of £2,000,000 in order that we might derate agricultural land?

There is another sum, of £476,000, representing the balance of the local taxation grant, also paid to the local authorities. Do the Deputies who want us to reduce taxation want us to cut that out? The only other items of any significance in the Central Fund services are the £250,000 annuity payable to the United Kingdom under the Damage to Property (Compensation) Act of 1926—an Act which the principal Opposition Party (the Party which is now the principal Opposition in this House) was responsible for putting on the Statute Book, in order that they might be in a position to fulfil a contract which they had made with a neighbouring Government. Do the Deputies who are clamouring for the reduction of taxation want us to cut that out: do they want us to dishonour their bond?

Mr. Gorey

Why did you not keep the promises that were made?

Mr. MacEntee

This is a promise that was made before 1932. They made it in 1926, and we have to collect £250,000 as taxation in order to honour it.

From the figures which I have given, which relate entirely to the services charged on the Central Fund, it would appear that if taxation is to be reduced and if the conservative attitude which the Opposition have adopted during this debate is to be given effect to, economies must be made in the supply services. In connection with my Financial Statement, I circulated an important set of tables to this House. One of the most important, I think, from the point of view of a discussion of this kind, is Table No. 7. In that connection I set out there the figures for the realised expenditure upon all the public services for the year 1931-32, and for the actual expenditure for the year 1938-39 on those same services. I would like for a moment to set those figures before the House for their consideration.

I do hope that the Deputy who was responsible for moving this motion, when he comes to wind up this debate, will take up the challenge which I made, not merely in the Budget speech of this year but in the Budget speeches of earlier years, and tell the House and tell the people—because it is important that the people should know what is implied in a motion of this sort and that the House should have some further token that the Opposition are in earnest when they put forward a proposition of this kind—what particular services he would curtail— where he is going to make the economies which it would be necessary to make in order to enable us to reduce taxation. That is an issue which he cannot afford to shirk if he is honest and sincere, and I am giving him credit for being both. If he is honest—notwithstanding the fact that he is an astute politician—and if he is sincere in this matter, he will say categorically what the services are that he would put forward to the Government as services which should be curtailed in order that, as I have said, taxation might be reduced; because there can be no reduction of taxation without a curtailment of expenditure upon certain services.

Take Table No. 7, to which I have been referring. The first category of services set out in the table is one to which, for want of a better description, I have been referring as the social services proper. I have given there the Exchequer issue on the 12 services included in that category. Last year the total issues amounted to £9,781,000 and for the year 1931-32 the audited expenditure upon social services proper which were then in existence amounted to £4,552,000—an increase, all told, of, say, £5,230,000.

Mr. Cosgrave

That is, between expenditure and estimate.

Mr. MacEntee

No; on this occasion, in order that there might be no possibility of a quibble or an evasion, I have given the audited expenditure for 1931-32 and the actual expenditure for 1938-39. The audit may change the figures for 1938-39, but it will not do so, as the Deputy knows, to any significant extent.

Mr. Cosgrave

Is it because it is a more favourable figure that the Minister is taking it?

Mr. MacEntee

I am comparing the figures for 1938-39 with the audited figures for 1931-32, and I have told the Deputy that in regard to this category, which, for want of a better description, I have called social services proper, we expended in the year 1938-39 £9,781,000, that is £5,229,000 more than was expended in 1931-32.

Mr. Cosgrave

Is the Minister borrowing to get that?

Mr. MacEntee

Yes, we are.

Mr. Cosgrave

Deduct that.

Mr. MacEntee

We are borrowing £350,000 more, but if I refrain from borrowing that £350,000 more, I have got to increase taxation by a corresponding amount.

Mr. Cosgrave

If we are on taxation let us keep to it.

Mr. MacEntee

No, we are going to keep to the services. It is of primary importance that the Opposition should come out in its true colours and tell us—for once they ought to be blunt and straightforward with the people— what services they propose to reduce.

The expenditure upon the first eight items in that table is undertaken upon services such as old age pensions, widows and orphans pensions, unemployment assistance, national health insurance, relief schemes and employment schemes, grant for milk, meals for school children and medical treatment for school children.

Mr. Cosgrave

And the expenses for the Ministry of Local Government administration?

Mr. MacEntee

Yes; a very essential item in all social services, because the expense of administration is part of the cost. One can reduce the cost of administration by reducing the amount expended upon services and, therefore, all have to be taken together. The point about it is, however, that here are eight services which I think are of vital importance. This motion proposes that we should do certain things in order to stimulate profitable production and abolish poverty within the State. The eight services are to alleviate distress and they tend, therefore, in accordance with Part III of this motion, to abolish poverty within the State. I want to know, in relation to any of these eight services, whether the Leader of the principal Opposition and his Party propose to make any recommendations for their reduction which would enable a reduction in taxation, if the proposals were agreed to and were acceptable to the people and to the House.

I am leaving these eight services for the moment and coming to other services within the same category. The next heading in the table to which I have referred is the provision which is being made in order to assist the local authorities to deal with the housing problem, which is so grave and serious throughout the country. Under that heading, we provide both grants and contributions to local authorities in respect of the loan charges on moneys raised from State sources and otherwise for housing. Does the principal Opposition Party suggest or recommend—and this is a question which, I am perfectly certain, the people outside, who are taking, I have no doubt, a great interest in this debate, are going to ask the Party which has made itself responsible for this proposal—that we should curtail the provision which, at the present moment, we are making, and making, I might say, in conditions of great stress and stringency? The Deputy quoted my words, but we are undoubtedly, even in the midst of the present uncertain position, making a very large provision in order that the people may be properly and decently housed, and I am asking Deputies who want us to reduce taxation to say, if they do not propose or suggest any curtailment of expenditure on old age pensions, unemployment assistance and the rest, that we should curtail expenditure on housing, that we should ask the local authorities to suspend their housing programme, and that we should refuse to assist the local authorities to the extent of our ability to do so?

Apart altogether from what views Deputies might have in regard to the future, I remember quite distinctly, when the first Housing Act was introduced, the very warm welcome it received, no doubt very sincerely expressed, from Deputy Dillon. We could not at one stage possibly spend enough money on housing, and if I am any judge of Deputy Dillon's approach to these social problems, I would assume that if the question arose as to whether we should, or should not, curtail expenditure on housing, and if we proposed to do such a thing, Deputy Dillon would be up in arms against us and would probably go out, waving the Red Flag, and try to head a revolution against the established authority in the State.

Mr. Davin

Not the Red Flag, surely? The republican flag.

Mr. MacEntee

Again, we have all these other services which come under the control of, and are administered by, the Minister for Local Government. Deputy Mulcahy knows them well, and Deputy Cosgrave, no doubt, knows them equally well, because he was Minister for Local Government in the Cabinet of the First and Second Dáil, and I am certain that he takes a very great interest in all these social problems. Is there any one of these services administered by the Department of Local Government which Deputy Cosgrave would be prepared to recommend should be curtailed or suspended?

The only remaining item, with the exception of Gaeltacht Services, which is comparatively small, under the heading of social services proper, is the Land Commission expenditure and here, undoubtedly, there has been a jump of no less than £1,032,000 between the year 1931-32 and the year 1938-39. About £600,000 of the increase in expenditure under the Land Commission Vote is due to the halving of the land purchase annuities, and there is no escape, in my view, unless, and this is what Deputy Dillon, who sits for Donegal, may have had in mind——

Mr. Dillon

Deputy Dillon sits for County Monaghan.

Mr. MacEntee

I forgot for the moment that the Deputy is, so to speak, a political bird of passage. I do not know for what constituency he will be sitting after the next general election.

Mr. Dillon

The Minister need not be one bit uneasy. He will be at the top of the poll in County Monaghan.

Mr. MacEntee

A prospective candidate in Mayo in one general election, sitting for Donegal after the next general election, and, a year or two years afterwards, sitting for Monaghan.

General Mulcahy

The Minister travelled a bit himself.

Mr. MacEntee

I have had to leave my own constituency once and the Deputy can have that for what it is worth. Let me stick to this question of the Land Commission, because there is a service upon which there has been a very considerable increase in expenditure. As I have told the House, the expenditure on the Land Commission Vote, the actual issues last year, amounted to £1,032,000 more than for 1931-32, and, of that, no less than £600,000 has been incurred by reason of the fact that we halved the annuities payable under the post-1923 Land Acts. I ask Deputies opposite whether they are prepared to recommend that that concession should be done away with or withdrawn, and that a Bill be sent to the Oireachtas to enable it to be done. There is a sum of £600,000 there to be saved and, thereby, a £600,000 reduction in taxation. Are the Deputies, opposite, or any other Deputies, whether on the Government Benches or elsewhere, prepared to suggest that that concession should be withdrawn and that the full annuities under the post-1923 Land Acts should be payable by any of the existing body of tenant purchasers? That is the question I am putting to Deputy Dillon, not in the hope that he will give me an immediate reply, but that he will give me a considered answer sometime to-morrow, when he rises to close the debate. He will have a full opportunity then and I await with great interest what he has to say in the matter.

Mr. Gorey

How much is the Land Commission itself costing?

Mr. MacEntee

Expenditure upon all the services which I have mentioned, and which was met from revenue, was £9,566,000 in 1938-39, compared with £4,552,000 in 1931-32, representing an increase of £5,014,000. The increase in the total supply services to be met from revenue in the same period, that is, all the services, and not merely those which I have described as social services proper—was £6,813,000 and, there, accordingly, the social services proper represent 74 per cent. of the increase in the cost. There is a very large sum. Is there any Deputy who is prepared to recommend that we should save that 74 per cent.? I am perfectly certain that there is not one. I know, furthermore, that if there were one, and if he stood for that policy in present circumstances, he would disappear from public life, temporarily, certainly, and, I feel, almost as certainly, permanently.

Mr. Gorey

How much is the Land Commission itself costing?

Mr. MacEntee

The next block of services dealt with in this table, in the category which I have described as "Other similar services", is the educational services. On the education services, there was an increase in 1938-39, over 1931-32, of £469,000. There was an increase of £112,000 for secondary education—and, mind you, this is a reflection of the conditions existing in this State, both in town and country—due in a considerable measure to the increased attendance at secondary schools. There were many more people both in town and country able to afford to send their children to secondary schools in 1938-39 than there were in the year 1931-32. That fact certainly is not consistent with the lugubrious statement with which members of the Labour Party prefaced their amendment to this motion.

The next item in this table to which, perhaps, I ought to refer is Army pensions. We have increased Army pensions by £394,000. I remember in the year 1936-37 that leading members of the Opposition were pressing us to provide these £394,000 additional to the Army pensions because they thought it would be a good election stunt to make more generous provision for Army pensions than we had made. It would be very interesting, indeed, if they proposed now to try to secure any economy in that expenditure.

Take the next category in this table. That is the category of services which had been classified as developmental services. There is an increase there of £1,600,000 in the year 1938-39 above the amount in the year 1931-32. Of this sum no less than £1,064,000 additional expenditure is accounted for by agricultural and fishery services including afforestation. I do not know whether Deputies are going to suggest any economies under that head or whether they are going to try to reduce the expenditure which we make in order to develop and assist agriculture in this country, or whether they are going to tell us to stop these services or to drop any idea of developing the fisheries. There you have in respect of developmental services including expenditure upon turf, fisheries and afforestation no less a sum than £1,600,000 more spent in 1938-39 than was spent in the year 1931-32. There, Deputies have ample opportunities to reduce expenditure if only they have the honesty to say that their motion was seriously intended and that they are prepared to face the consequence of it.

There are a number of other services. Of the remaining 17 items in this Table 7 only seven showed any increase Two of these were:—Wireless Broadcasting where the increased expenditure paid for itself. The increased expenditure was met by an increase in revenue; and Stationery and Printing where the increase has been due to the rise in prices. There were a number of other services on which the increase in expenditure was considerable.

I would like the Party which has taken responsibility for putting down this motion to tell the House what its attitude is in regard to these services.

Upon Posts and Telegraphs we are spending £245,000 more than in 1931-32. That has been necessary in order to give the farmers and others the increased facilities for which they have been asking and in order to provide the increased remuneration for those engaged in that service. I never yet heard any Deputy on the Opposition side on any occasion upon which the Vote for Posts and Telegraphs was before the House suggest that any reduction should be made either in that remuneration or in the services which the Department provided. Here Deputies have an opportunity to-night when asking for a reduction to tell whether they want us to reduce this £245,000 additional expenditure that was incurred under Posts and Telegraphs this year. On the Gárda Síochána service we are spending £219,000 additional. The greater part of that expenditure is not within our control. The increase has been determined by the fact that the great body of the Guards came in here 15 or 16 years ago. By the incremental scales to which they are entitled under the conditions of their service there are increases in the salaries in some cases in consecutive years and in other cases at intervals of four years. But, as we have to do in the case of damage to property compensation, we are simply honouring the bond into which the preceding Government entered with these men when they were taken into the Gárda Síochána. There has been no additional development in that service; it is due to the incremental increases. That is largely responsible for the £219,000. Then there was the partial restoration of the boot allowance to the Gárda and the increase in rent allowance which became absolutely necessary and to which the Opposition as well as the Government agreed. The Opposition have now their chance of saying that these things should be taken back or that there should be a departure from the scale that was laid down. Deputies must say something like that if they want to save £219,000 on this item.

Public Works account for £138,000, additional. This is very largely expenditure upon necessary public works of one kind or another in order to provide accommodation with which the work of the Government must be carried out. Then there are other minor services amounting to £266,000 additional.

There is, however, I gather, one service upon which the Opposition are prepared to suggest reduction. That is the provision which we made for national defence for the year 1938-39. A sum of £520,000 was spent additional to what was spent in 1931-32. Now, my recollection is that last year we were told that the Government was not spending enough upon national defence. This year we have been told by the Opposition speaker who preceded me that in his view we could save considerably with regard to national defence. What is the Government to do? Deputy O'Higgins and certain members of the Opposition have one view as to how the defence of this country can be properly provided for. The Minister for Defence and his advisers have another view. I think if the safety of this country has got to depend upon whether we are to take the view of the Minister for Defence and his advisers who know the facts— if we are to choose between the view of the Minister and his advisers and the view of so eminent a politician as Deputy O'Higgins—then I think that the people of this country would feel safer and more secure if we took the official Army view in this matter. We have to make the provision which in all the circumstances and considering carefully what the position of this country might be in the event of a European war seems best to the Minister and his advisers. I think the view of the people of the country would be that we were fully justified in imposing additional taxation for their safety and security. That is what we are doing. That is the provision we are making for the defence of this country and of our people. Defence is the only service with regard to which the principal Opposition Party in this State has ventured to say we ought to save money. That is a very easy matter to do if one were to gamble and play with the lives of the people and the future of the country. I do not think we should be a rational Government or a Government capable of dealing with our responsibilities if for a moment we took the easier course and told the people: "We are going to save money upon your defence and upon your security; we are going to reduce taxation and we hope that, if a serious European situation does develop, you will be all right."

The sum and substance of all I have been saying comes down to this—that the present scale of taxation cannot be reduced without a corresponding reduction in expenditure or an increase in the dead-weight debt. The Opposition do not want an increase in the dead-weight debt. Neither do we. It is because we do not want an increase in the dead-weight debt that we have undertaken the unplesant duty of imposing taxation upon the people in order to provide for this increased expenditure. The Opposition, who put down this motion, have now to make their choice. If they want to have these services, they can have them only by maintaining taxation on the existing level or by doing what, I think, would be completely and wholly wrong— increasing the dead-weight debt. I do think, as I have said, that, before this debate ends, we should hear from the Opposition some considered statement as to how, in their view, we are to reduce taxation. We do not want any generalities. They are of no use to a Government. We must have specific suggestions. It is no use for the Leader of the Opposition, or Deputy Dillon or Deputy Mulcahy, to get up and say that it is not their responsibility to suggest what expenditure should be curtailed. They have taken upon themselves the responsibility of telling the people that, in their view, taxation can be reduced. There goes with that a concomitant responsibility to tell the people in what way money can be saved so that taxation may be reduced and I hope that, before this debate ends, they will rise to that responsibility and tell the House and the people what we are all so anxious to hear.

I have been dealing at great length with what is implied in the suggestion that we should reduce the burden of direct taxation. It is also suggested that we should reduce indirect taxation. As I said at the beginning, indirect taxation, in the accepted connotation of the term, means those taxes levied not directly upon individuals, in the first instance, such as income-tax, but upon commodities and, therefore, only indirectly upon individuals when they use or consume such taxed commodities. That is not the sense in which the term is used in this motion. In this motion, the term is applied to those devices which are designed to fix prices by direct State intervention. What are these devices? What does the Opposition mean when it asks the House to tell the Government it should reduce indirect taxation? The devices for fixing prices are enumerated in Appendix 12 of the Majority Report of the Banking Commission and, though the information contained in that Appendix is somewhat out of date by reason of the withdrawal, as a consequence of the agreement with the United Kingdom, of the British penal duties, nevertheless, in general, the price-fixing machinery is set out-in that Appendix. Any person who turns to that Appendix will immediately notice that the principal items enumerated in that Appendix go to the benefit of that class of the community in regard to whom we have heard so much from the Opposition Benches from time to time. I refer to the farmers. We were told, for instance, by the Deputy who moved this motion that we ought to give the farmers a chance to enable them to produce at a profit and to enable them to get economic prices. Here we have in this motion a demand that we should disband the machinery by which they are able to get economic prices. To repeal the various statutory authorities for these price-fixing devices would, perhaps, result in reduction of the cost of living but it would, undoubtedly, place the farming community at the present time in a rather precarious position. We come, again, to this inconsistency; it is merely one of the many which mark the Opposition attitude in regard to this matter—that they ask us to give the farmers a chance to enable them to produce at a profit and to secure economic prices and, then, when we respond to that demand by giving the farmers guaranteed prices for butter, beet and bacon, we are told by Deputy Dillon and those who speak the same language as he does that all this is concealed taxation, that it is taxation for private, individual purposes and, therefore, that the whole of it is nothing short of immoral and should be wiped out. If we do that, we are going, undoubtedly, to prejudice very severely the position in regard to the farming community.

I am afraid I shall have to detain the House for some time because, having dealt with No. 1 of the demands made in this motion, I want to turn for a moment to consideration of the additional demand that we should restrict the creation of further dead-weight debt.

Mr. Dillon

I thought you were talking about that for the past half hour.

Mr. MacEntee

No. I was merely dealing with the services upon which the proceeds of taxation are being expended. The Budget of this year contains proposals for creation of additional dead-weight debt amounting to £2,005,000 and, perhaps, in regard to that large sum, the details of which I shall give in a moment, the Opposition might tell us which of the heads of expenditure they would abolish. We have, of course, Defence expenditure on Votes 11 and 65, amounting to £1,350,000. That is the amount we are proposing to expend on national defence this year. For the construction of air ports we are borrowing £246,000; for property losses compensation, £3,650; for afforestation, £55,000, and for employment schemes, £350,000. Property losses compensation is a rapidly disappearing service and this is perhaps the last year in which we shall have to borrow under that head. Take the case of the air ports, for which we are borrowing £246,000. Is it the considered opinion of Deputies opposite that we should stop the construction of airports, that we should refrain from erecting any port or from utilising the opportunities which our geographical position gives us, in developing this mode of transport? It is quite easy to take a decision in regard to that, but let the country know what it is. Our Party thinks that, availing of the opportunity which God has given us, we ought to go ahead and put ourselves in a position to take the fullest advantage of whatever developments in aviation may occur in the future.

We are also borrowing £55,000 for afforestation. There has been a very insistent propaganda in recent years in favour of an enormous extension of forestry operations. That propaganda has received the support of a very large number of Deputies on the benches opposite. As I have pointed out, we are borrowing £55,000 for that purpose this year. You can avoid the creation of dead-weight debt to that extent by deciding that you do not want to have this country reafforested. I do not know whether you do or not. I take it that you have never opposed the Vote in this House. The country does not know whether you do or do not but, if you want to avoid the creation of dead-weight debt, that is one of the services you can either suspend temporarily until the country gets into a stronger economic position, or abandon permanently, but, at any rate, the obligation rests upon you of coming to a decision.

For employment schemes we are borrowing £350,000. Do you want to discontinue these schemes? If we refrain from borrowing this £350,000, we can avoid creating dead-weight debt to that extent. Of course then we shall have come into conflict with demand No. 1 in the motion because we shall have to provide that £350,000 out of taxation. There may be a third course, to drop all these employment schemes. From the wide range of choice which I have put before you, you should tell us whether you are going to impose taxation for the purpose of providing these services, whether you are going to create further dead-weight debt by borrowing for them, or whether you are going to discontinue them altogether.

Perhaps before I leave that aspect of the matter, I might refer to the fact that, apart altogether from the borrowings for the purposes which I have mentioned, debt liabilities are being contracted in other directions. Thus, as I have already mentioned, under the Housing Act the State has accepted a capital liability of 1.3 millions in the year 1937-38 and 1.1 millions last year bringing the total liability for housing purposes to 31st March last up to no less than £7,250,000. As long as rehousing is being continued on the existing scale, as long as the provisions of the Housing Acts regarding the contribution to loan charges continue, the debt in respect of housing will continue to pile up at the existing rate. There again, Deputies who sponsored this motion ought to tell us whether they contend that housing assistance should be entirely withdrawn or substantially reduced.

Another reason for our mounting liabilities is that the work of the Land Commission involves a considerable increase in the dead-weight debt. By reason of the halving of the annuities under the Act of 1933 the capital liability of the State was considerably increased. Operations under the Land Acts, 1927 to 1933, increased the figure for 1937-38 by £294,000 and for 1938-39 £180,000.

General Mulcahy

Is that in respect of new land division?

Mr. MacEntee

That is in respect of new land division. The Opposition Party can tell us whether in future that should be discontinued. I hope if they say so for the purposes of the debate on this motion, they will also say down the country, in the rural constituencies, that they think it should be discontinued. I hope they will be prepared to defend that opinion before the people.

Mr. Davin

You will be all together the next time.

Mr. MacEntee

Perhaps we might turn to consider Part III of the motion and, incidentally, in that connection to consider some of the issues raised by the Labour amendment. I think, Sir, that it can be said that to stimulate profitable production and to abolish poverty within the State are the avowed aims of every Government in the world. That is a very desirable objective, a very clear one, but I am afraid that the means by which that objective can be reached are not equally clear. Indeed, I think no one can contend that the various measures which have been taken have resulted in unqualified success. We have had an opportunity here during the past eight or nine years of watching experiments which have been made in other countries in order to deal with this problem, in order to stimulate profitable production and to abolish poverty within the State. My view, for what it may be worth, is that the greatest measure of success has attended the application of the more carefully calculated and prudent policies. We have seen very spectacular schemes undertaken in the United States, France and other countries but I think the general consensus of opinion now is that these policies have added to the difficulties of the problem rather than assisted in the solution of them.

We are a very small country with very limited resources. For an agricultural country, a country that is almost purely agricultural, this is a rather densely populated country. We are not in a position to pursue, in relation to certain matters, a completely independent policy. We produce a very large agricultural surplus, much more than we could ever consume. We must, therefore, find a market for that surplus and, therefore, in regard to the operation of a closed economy, we are in a very different position from much more powerful States. For instance, I think no one would try to contend that our capacity to control our economy would be anything, say, like the capacity of the United States —a continental country with huge resources, both natural and financial. In the United States since 1933 they have tried to put into operation all these numerous and varied schemes which are connoted by the New Deal and which, so far as I can see, have little in common except their capacity for increasing expenditure. They have pursued a very eclectic policy. They have tried everything. They have not approached the problem with any sort of prepossession in favour of one course or another. They have been willing to try everything which seemed to offer a chance of success in order to deal with this problem of stimulating profitable production and abolishing poverty within the State. And what has been the consequence? In the five years from 1933 to 1938 the gross public debt of the United States has risen from $24,000,000,000 to over $39,000,000,000— an increase of two-thirds, at the phenomenal average rate of 13 per cent. per annum. Millions of dollars have been spent in the United States on public works, on direct relief and on veteran bonuses. The National Recovery Administration secured the adoption by industry of methods involving price fixation, the elimination of the cutthroat competition, the reduction of hours and the improvement of terms of employment. Agriculture was freely subsidised; prices of agricultural products were raised; all the limitation of production was discontinued and existing mortgages were re-financed. The Reconstruction Finance Corporation, using public funds, lent money for the rehabilitation of banks and of private industry.

When this expenditure to which I have referred was initiated, production recovered for a short time and wages began to rise. The year 1937, for instance, opened with production close to the 1929 level, with prices, wages and profits rising and with business in a high state of confidence. Yet, within a very short period, by the midsummer of 1937, a recession had set in as serious as it was surprising and by the end of the year general production was down by 30 per cent. and the price of primary commodities was much below the spring peak. That is what always happens when an inflationary policy has been adopted. You have stimulation of production, an increase in wage levels, an increase in prices, and then you have—in the word which the Americans generally adopted—the recession. They call it a recession because they do not like "depression" and they do not like "slump." That, however, did not discourage them. The inflationary policy, as they termed it, was not abandoned and proposals were drawn up for spending once again as a way out of the recession. The programme of Government spending and lending was expanded and the policy which I have referred to was vigorously renewed. Millions more were spent on public works. The Reconstruction Finance Corporation was authorised to make further loans. The system of the minimum reserve ratio of the principal banks was introduced; the policy of gold sterilisation was abandoned and the funds realised were added to the Treasury to find their way into general circulation. And with what results? Once again they were disappointing. There was a slight recovery. Just as in 1937, there was a slight recovery during 1938, but again this recession, this bugbear of all inflationists, set in in December last and agricultural production has again declined. There are no signs of the recovery everybody was expecting and had anticipated from this policy of pump-priming, of using the national credit to stimulate production and to absorb the unemployed. At no time did this policy of pump-priming in America, where such huge sums were devoted to it, succeed in reducing perceptibly the huge volume of the unemployed which was variously estimated there at between 7,000,000 and 11,000,000. The number on the relief rolls remained steady at 3,500,000.

Although the dollars and cents income of the average wage-earning family was the same in 1936 as in 1929, labour costs as measured by hourly earnings had increased by 24 per cent. The inevitable result was that prices were higher and the purchasing power of the average income lower. A falling off in retail prices and in the activity in the consumption goods industries preceded the recession of 1937.

I think that it will be admitted by any person who studies very closely and carefully, as I have tried to do, the history of this experiment in the United States that in the light of the experience there it is at any rate a prima facie indication of the futility of searching for a magic formula by which the average man can produce less and yet consume more. And America is not the only country where that policy has been tried out within recent years. There are many similarities between recent economic experience in France under certain governments and that of the United States under the present Administration. Both countries adopted what might be described and what were described by those who were responsible for them, as far-reaching recovery measures. In both cases the measures aimed at raising money incomes in order to increase production and employment through the increased demands for goods and services. In each case it has been accompanied by expenditure, huge expenditure on public works and similar measures. France, like the United States, has failed to regain the 1929 level of employment and production. Employment and production continued to decline in France until the Autumn of 1936, when the franc had to be devalued; when the currency had to be depreciated; when the French had to adopt Deputy Norton's policy of cutting adrift from their recognised parity. Deputy Davin had better make a speech himself.

Mr. Davin

I was listening very attentively to your lecture.

Mr. McGilligan

I have been listening for the last five minutes. It has been tedious.

Mr. MacEntee

The Deputy has not endured the tedium very long.

Mr. Davin

I have stuck it for an hour and a half.

Mr. McGilligan

Please continue.

Mr. MacEntee

I was saying, Sir, that employment continued to decline in France until the autumn of 1936 and then they tried Deputy Norton's specific; they devalued the franc; they reduced the currency. There was a momentary increase in industrial activity, but marked, of course, by an equally enormous increase in the national debt, a persistent rise in all prices and in the cost of living, and an increase in the import surplus. I move the adjournment.

Debate adjourned.

The Dáil adjourned at 10.30 p.m. until 3 p.m. on Thursday, 6th July, 1939.