l62 



NATURE 



[October 23, 1919 



second into the head in feet; the b.h.p. of the tur- 

 bine will be given by one-eleventh of the same product. 

 The ground covered by the paper is too extensive 

 to admit of adequate notice in the space at disposal. 

 From the foregoing extracts the paper will be seen to 

 be replete with useful information. 



Brysson Cunningham. 



THE BRITISH ASSOCIATION AT 

 BOURNEMOUTH. 



SECTION F. 



economic science and statistics. 



Opening Address (.'\bridged) by Sir Hugh Bell, 



Bart., D.L., J. P., President of the Section. 



The cessation of hostilities did not carry with it the 

 cessation of expenditure. The figures given each week 

 in the Economist show the daily disbursements of the 

 kingdom to have amounted to 6,500,000/. for the 

 twenty-one weeks from November 16 to April 12. Our 

 expenditure from August 24 to November 9 amounted 

 to 585,500,000/. From November 23 to July 8 we ex- 

 pended 564,000,000/., a reduction of only 21,500,000/., 

 or about 250,000/. a day. The debt with which the 

 war burdened us continued to augment lonjj;^ after the 

 cause of it had ceased to operate. We are still vastly 

 exceeding our income. Even if we take into account 

 the interest on the war debt, which amounts to about 

 1,000,000/. a day, it is clear that the various obliga- 

 tions undertaken by the Government during- the war 

 continue to impose on us a huge expenditure which 

 is largely in excess of our revenue. 



New claims are made on the national purse and are 

 accepted with the same apparent light-heartedness and 

 disregard of consequences which mark so many pre- 

 vious acts of those responsible for our expenditure both 

 during the war and before it. 



The call made on the men and women of the nation 

 for services differing from those to which they had 

 been accustomed involves great changes in the con- 

 ditions of those affected. Some compensation for these 

 sudden changes was, no doubt, inevitable. The disor- 

 ganisation of the whole industrial machine made it 

 difficult, if not impossible, to turn these different classes 

 adrift into a world in the chaotic condition into which 

 the war had thrown it. But it does not follow that 

 this compensation should have been given in a way 

 actually to encourage unemployment. There are only 

 too many indications of a general tendency to extrava- 

 gant expenditure which must be checked before the 

 course of our economic existence can return to normal 

 lines. To enable us to do this we must consider what 

 has happened to the world economically since August, 

 1914. 



The first and perhaps most striking change to be 

 noticed is that in these five years an immense quantity 

 of wealth has been destroyed. 



There must be many hundred thousand acres of 

 cultivated land, with the apparatus required for 

 its cultivation, which has been reduced to a state 

 of complete desolation. It is difficult to see how 

 it can be brought again into use at an early date. 

 The mere clearing away of the wire entanglements 

 must be a costly operation. Great quantities of shell 

 abandoned by the Germans in their hasty retreat 

 still cumbered the ground they had occupied. These 

 must be carefully removed — not a very simple opera- 

 tion, and one which must be carried out under skilled 

 direction. 



Can anyone doubt the huge destruction of wealth 

 which has occurred? But it is really worse than it 

 appears, for the very process of destruction was even 



NO. 2608, VOL. 104] 



more costly than the damage which was done. Mil- 

 lions of tons of steel in the form of guns and their 

 projectiles— millions of lives had gone to produce this 

 untoward result. For fifty months all the energies ot 

 the most active and energetic people on the globe had 

 been turned from beneficial enterprise to work of 

 which the result was the annihilation of vast masses 

 of wealth. 



When all these things are considered it is not sur- 

 prising to find our estimate of the cost of the war 

 reaches a total the mind cannot grasp. When you 

 begin to speak of pounds by thousands of millions, the 

 ditlerence between twenty-five and forty is scarcely 

 noticeable. But be the sum larger or smaller, the all- 

 important fact to be borne in mind is that the wealth 

 which it represents has passed out of being. 



So much confusion exists on this subject that it is 

 worth while dwelling on it for a moment. Some con- 

 tend that there has been a mere change of wealth 

 from one ownership to another. Into whose posses- 

 sion, may we ask, has passed the wealth which used 

 to exist in the towns and villages and cuPtivated land 

 of the battle area? It is true that the steel which 

 went to effect thfs destruction has been paid for, but 

 from what source has that payment come? Let us 

 think what might have happened but for the war. 

 The steel might have made rails and been laid on a 

 railway to bring the produce of Central .Africa to lands 

 ready to pay for it and desiring to consume it for use- 

 ful purposes. For all time there would have arisen 

 in the process an income which would have gone to 

 support in comfort those receiving it, and its surplus 

 after this had been effected would have served to add 

 yet more miles of railway and to bring yet more tons 

 of useful produce. All this energy has been dissipated 

 in the manner indicated, and all that remains is the 

 obligation of the "State" for all time to pay interest 

 on a debt which has been created. 



There is, as it seems to me, but one way to escape 

 from the situation we have created. No measure of 

 confiscation, however disguised, will remove the burden 

 under which we lie. It may be decided to alter the 

 incidence of the burden from one set of shoulders to 

 another. Any proposal of the kind must have very 

 careful and earnest consideration. 



If a really sound and equitable scheme of taxation 

 could be devised, each taxable unit would contribute to 

 the common fund raised for the purpose of the Govern- 

 ment an amount which would be arrived at after due 

 allowance was made for his services to the community 

 and his ability to pay. A bachelor, with no claim on 

 him but to support himself without State aid, who 

 had done nothing to provide for a citizen to take his 

 place in the fullness of time, might be called upon to 

 pay more than a man under obligation to maintain 

 a family, and supply, by his children, the means of 

 carrying on the torch of progress. 



One of the chief objections of graduation seems to 

 be the danger of gradually increasing the steepness of 

 the scale until the higher incomes would be taxed out 

 of existence and the revenue they produced disappear. 

 This would, no doubt, bring its own remedy. The 

 State needs a certain annual revenue to provide the 

 services demanded by the community. If the result 

 of taking much the greater part of incomes over a 

 certain amount ends by extinguishing these, the State 

 will cease to derive the revenue on which it counts. 

 It must then either reduce the tax on them until a point 

 is reached at which they will continue to exist, or it 

 must increase the tax on all or some of the other in- 

 comes. Unless it means to rush headlong into bank- 

 ruptcy, it must find the point of equilibrium at which 

 its scheme of graduated taxation continues to produce 



