This second part of Beyond Capitalism and Socialism concerns industrial policy and related matters.
Presented by Marshall Bridge and Carl Hemmings. 

The Modern Doctrine.

We nationalists seek a modern doctrine for industry which completely transcends the old arguments between capitalism and socialism, while taking what is best in each.

From Capitalism we take the element of healthy, bracing competition with its generally beneficial effect on the quality of goods and services.

Subject to the control of inflationary factors earlier discussed, goods and services in a competitive economy will also reach the consumer at the lowest possible prices.

The continual fight in a competitive economy to combine good quality and service with the lowest possible prices is the factor which breeds efficiency.

Low prices must, however, be the product of greater efficiency and not of cheap, sweated labour.

British producers may be undercut in the British market by other British producers paying high wages but organising their production and services better, they may not be undercut by foreign producers paying low wages.

From capitalism we also take the element of incentive that is contained in the profit motive. Profit is quite legitimate as a variable wage to those who provide the brains and initiative that make for national prosperity, it is immoral only in the case of those who make no contribution to national prosperity.

It is quite certain that without the incentive of profit the great inventions and techniques of industrial and commercial organisations that gave economic supremacy to the Western world would never have occurred.

On the other hand, we reject in capitalism the excessive power that is possessed by the huge units of business that have arisen today particularly when they become monopolies and eliminate the very competitive factor that gives the private enterprise system the justification for its existence.

We reject also those aspects of capitalism that make for parasitism, speculation and financial usury. We reject also many of the ‘middleman’ activities that create an excessive margin of profit in the transfer from producer to consumer.

We take from socialism the doctrine that industrial activity should be controlled by a power that is above business and controlled in the national and public interest.

We take from socialism the principle that business has a social duty over and above the pursuit of profit and that there should be a state mechanism whereby this can be enforced where necessary.

We also take from socialism the doctrine that certain forms of economic activity, particularly those on the biggest scale, should be planned with the interest of the community in mind, instead of just being left to the haphazard interplay of private forces alone.

The difference is that we seek to provide the framework of national economic sovereignty alone in which planning can be effective. We share with socialists the belief that the doctrine of the ’free market’ economy whereby profiteering forces are left to themselves to fight it out in the assumption that the victory of the stronger will serve the national interest is wholly inadequate to cope with the complexities of the modern world of economics and the vast power that big business in the free market can command.

We reject in socialism the sterile doctrine of wholesale nationalisation, with its concomitants of monopoly, bureaucracy and inefficiency.

We reject in socialism the pampering doctrine that the state will provide for all, regardless of individual effort.

We reject the levelling down principle that is inherent in the left wing doctrine of human equality, and we assert that differences in the distribution of wealth are good and right so long as they reflect the differences in the value of each individual’s contribution to the national welfare.

We believe with socialists that no barrier should be closed to talent, from whatever level of society it may come, but we eschew the fantasy that every individual has from birth the same potential to succeed in life and that differences in success, between individuals as between nations and races, are due solely to environmental causes and not to inherent capacity.

Upon the synthesis of capitalism and socialism we super-impose our own doctrine of nationalism, which in economic terms means that we seek salvation through the independence and self reliance of the nation-state, of our own country and people, that we look to national resources and national effort to see us through the world rather than chase moonbeams of international ’solidarity’ and that in the ordering of our affairs we believe in putting Britain First.

From this point we reject the internationalism that stands at the centre of both socialism and contemporary finance capitalism.

We seek co-operation with other nations where practicable and where nationally useful, we reject dependence on other nations for our very existence.

Controlled Private Enterprise.

The modern doctrine supports a system in which most forms of economic enterprise remain in private hands.

This principle is not a rigid one, however, and each sector of industry and commerce must be judged on its own merits in the matter of whether it functions best under private or public ownership. In all such questions the national interest must decide,
Private enterprise, however must be subject in its operations to a firm set of rules laid down through a machinery of economic government, which govern minimum pay-rates, working conditions, workers’ participation and profit sharing, movement of capital, imports and exports, monopoly curbs, location of plant, conservation of environment and banking.

Every private trader, large and small, will need a licence to trade which will be granted and renewed subject to observance of these rules.

National Self Sufficiency.

The first aim of our industrial policy will be to achieve the greatest possible national self sufficiency for British industry, so as to reduce the vulnerability of the British economy to the unstable behaviour of foreign markets.

The principle will be that we will not import from foreign sources goods that can be produced in Britain.

This policy is of course wholly incompatible with British membership of the European Common Market and withdrawal from the Common Market will be one of the first acts of a nationalist government.

Also necessary will be a repudiation of the terms of the General Agreement on Tariffs and Trade (GATT), a device set up in 1941 under pressure from the international financiers to protect their interests and to prevent nations from safeguarding their economic independence.

In the field of manufactured goods, which account for about half our imports today, complete self-sufficiency is quite possible if the will is there to pursue it.

The policy of economic government will be to gradually reduce imports by a declining quota system operated over several years and governing all items that we now import from foreign sources, excepting a small number of curiosity, gift or antique items.

At the same time domestic industries will be systematically expanded to fill the gap.
Here is an area in which private and state enterprise will work in partnership.

Private enterprise will be given all possible encouragement to expand, and where necessary create from scratch, the industries needed to replace imports, and to this end state bank loans will be made available at the most generous interest rates.

Where private enterprise fails to rise to the challenge, state industries will be created as they were in wartime to supply certain strategic goods.

At the completion of this programme all major industrial goods now imported will be made in Britain. The result will be a huge reduction of Britain’s import bill and a correspondingly huge saving of foreign currency.

At the same time a greatly increased portion of Britain’s work force will have the security of employment gained from producing for an assured market.

Three objections to this policy will be raised by the defenders of the international system.

The first is that the policy could not possibly work under present conditions, since the hold up of domestic supplies of goods or parts through industrial stoppages compels dealers to buy foreign in order to deliver to their customers on time and stay in business.

We answer this by saying that of course the success of such a policy rests very much on the ability of the new system to keep industrial unrest to a minimum. Our proposals for achieving this will be explained later.

However it goes without saying that emergency licence to import would be given to businesses in Britain in a situation in which essential goods or parts were unavailable from British sources.

The second objection is that there are many fields of industry in which British products, where they exist at all are grossly inferior to the imported article.

This present fact is not denied. However, we believe that it is a thorough insult to the native skills of the British to say that such inferiority cannot be overcome if the necessary will is present.

It will be the task of a department of economic government to investigate those fields where British products are inferior and take the necessary initiatives to bring them up to standard.

Japanese commercial success in recent times owes much to this very policy, which may involve sending teams around the world to study the best foreign techniques with a view to introducing them at home.

Here again the partnership between private and state enterprise is essential to the success of a national programme.
The third objection is that exclusion of foreign manufactured goods from the British market will invite retaliatory measures against British goods in foreign markets.

This can very simply be answered by saying that for such an argument to be justified losses in overseas markets would have to be greater than gains in the home market.

This is highly improbable, as at present the biggest exporters of manufactured goods to Britain in most cases buy less British goods in return.

The great Eldorado that the politicians predicted that we would find in the Common Market was based on the theory that in return for letting Continentals in on our market we would make much greater gains in theirs.

In practice the very opposite has happened, and Continental industry has gained at the expense of British industry. By getting out of the Market we will gain much more than we lose in Europe.

In almost every case the balance of trade in manufactured goods is heavily against Britain, therefore were we to put up import barriers in these classification of goods even were all the countries concerned to retaliate in full (which would not necessarily happen) Britain would still gain considerably.

Side by side with the programme of industrial self sufficiency will be one to expand British agriculture to grow as great a proportion of our own food as possible.

Here we must seek new areas of cultivation, and these can be found in the upland regions of Britain. With new techniques of reclamation and conservation that are now available, it has been estimated that upwards of 10 million acres not presently under cultivation could be converted into a great agricultural area.

The necessary labour must of course be attracted back to the land by better pay rewards. We will seek to make these possible by cutting out many of the ’middlemen’ from the food distribution industry and encouraging more direct product-to-consumer methods. Our aim is that food will be eaten largely in the region where it is grown.

We will also encourage the extension of the allotment system for the production of many vegetables. The same state regulation and action will govern this field of the economy, although we recognise that where food is concerned total self-sufficiency may not be possible.

At present experiments are taking place with a view to reproducing older purer breeds of cattle, sheep, pigs and goats that are very disease resistant and much hardier so that they can survive on poorer highland grasses, do not need to be brought in winter and need much less work to keep them.

This research has received little encouragement from government and has had to rely mainly on private support. We would give it all the support possible.

For the food that we have to import complete preference will be given to products from the White Commonwealth. This policy not only gives us the best prices but it helps us to realise one of our most political aims, which is to restore the once strong ties of Commonwealth as a basis for reviving British world power.

The same policy will be followed where raw materials are concerned. We recognise that in this field a large proportion of our requirements will always have to be imported, and as with food we will seek to obtain most of our imports from within a commonwealth area.

However, great savings on our bill for imported raw materials can still be made.
In the field of oil we will exploit North Sea reserves for Britain’s benefit.

We will insist that all North Sea oil and gas fields are brought under British ownership and that all their reserves are kept for use by Britain.

We will ensure that our domestic coal resources are used to the utmost by a great revival of the coal industry. We recognise that this will mean paying the miners whatever rate is necessary to stay in the industry and to attract back those who have left the industry.

However with the increasing costs of alternative sources of fuel from abroad this money will simply have to be found. Rises in international oil prices will also strengthen the argument for extracting oil from coal.

Investment Control.

Control of investment will form another essential part of the prerogative of economic government. The rule will be made that British capital will be invested in Britain and not overseas except under special government licence, the issue of which will rest upon the question of whether the British interest will thereby be served.

Simultaneously, strict controls will be imposed on foreign investment capital coming into Britain. We consider it intolerable that huge sections of industry in Britain are now foreign owned and the decision as to their future made thousands of miles away.

We will reverse this process over a period of time by the compulsory purchase by degrees, of the major foreign owned industries with a view to their eventual resale to British owners.

Here one popular fallacy must be knocked on the head. Massive foreign investment in Britain does not enrich Britain, on the contrary, it impoverishes Britain.

Nobody invests money in an industry unless he expects to get more back as a return on his investment, and the result of foreign investment in Britain is that in the long run much more money leaves Britain than comes in.

Not only is large scale foreign ownership of our industries unsatisfactory from the standpoint of national self respect, it is unprofitable too.

Workers’ Participation.

Government legislation will institute workers participation and profit sharing for all firms above a fixed size of work force, apart from a few exceptional cases of industrial projects of a very temporary nature, in which case the question of worker participation will be decided on the merits of the case.

Generally speaking, we are in favour of a one third worker representation on the boards of industry and we advocate making this a mandatory minimum for all large industries apart from the possible exceptions described.

The precise representation, however can be determined by negotiation between management and labour provided that this rule is observed.

The forming of works councils should be a right of the workers in all industries should they wish to have them.

Where these works councils exist, they must be consulted and kept informed by the board on all matters pertaining to safety regulations, manpower and production planning, investment and modernisation programmes and the general financial state of their companies.

Members of works councils, as well as workers’ representatives on the boards of industries, should be elected to their positions by a secret ballot of all company workers.

Finance the Servant of the Nation.

In the new policy finance will come under much firmer public control than industry. There is a strong argument for the nationalisation of the whole banking system.

There is on the other hand the counter-argument that the special skills built up in the banking world over many centuries should receive their normal incentives and reward in the maintenance of the profit motive.

Under the new system private banking will be allowed to remain but will do so on trial. The condition will be that it will serve the national interest while being the servant of the economy and not its master.

If the private banking system does not live up to its obligations in this respect, nationalisation of the system should be instituted.
The criterion of legitimate private banking will be that it will act as a machinery through which money can be transferred and invested with maximum benefit to the productive side of the economy, and that it will not be a creator of money in its own right. Banks may invest profits earned by normal legitimate trading (subject to the rules of investment mentioned earlier) and they may derive profit from that investment.

They may also lend money derived from legitimate profits or from their client’s deposits, and likewise profit by the interest.

They may not create money by issuing paper credits that have no backing in existing bank funds, and then be paid for that privilege in interest which they have not earned.

State banking will operate side by side with private banking, and its main role will be to provide all the new money required to meet the expanding economy.

This money will not be issued as a loan repayable with interest but will be spent into the economy as normal public expenditure. The practice of the State of obtaining part of its income by borrowing from the private bankers will be brought to an end.

Also brought to an end will be the National Debt, which is the cumulative product of this procedure over centuries. That part of the National Debt owing to ordinary small private bond holders will be paid off. The part owing to bankers will be cancelled.

As the money representing state expenditure will be provided as new issue by the State bank this will enable an enormous reduction in taxation to take place.

The yearly extent of new money issued from the state bank will be based on an estimate of the yearly increase in the volume of real wealth to be bought and sold.

It will cover all public works, public housing schemes and the maintenance of public administration. State banking credits will be available to private industry and on the same terms as credit from private banks.

Summary.

In these pages we have made proposals which may seem revolutionary. We believe that the condition of Britain, a condition that is the product of slow gradual deterioration over a long period demands nothing less.

Our unhappy national plight is not a sudden phenomenon, a recent aberration from a normally sound, stable and prosperous state, it has developed over perhaps more than a hundred years.

It cannot be remedied by half measure or by men who are afraid of bold innovation.

The contemporary state of Britain denies to many of us a prosperous life.

It denies to all of us the degree of prosperity that we could have. But this is not all. It makes us an object of humiliation in the eyes of the world. Of these two things, the second is to us the less tolerable.

We believe that the nation is more than just a very large economic enterprise, it is an organic living growth with a heart and a soul and a sense of pride.

A nation that has scaled the heights of human achievement and has occupied a place in the world second to no other cannot survive happily on mere bread and circuses, it seeks nourishment of its spirit by the pride of new achievement and the quest for new greatness.

We believe that nothing less than these things provides a fit future for Britain.

We seek a new basis for national prosperity - but not as an end in itself. We seek prosperity as a means to the reassertion of our rightful role in the world, to the restoration of our independence and the maintenance of our self-respect.