The Old Look

With Britain heading into its sixth economic crisis since war's end, Prime Minister Macmillan and his Cabinet for weeks have been promising tough, bold, imaginative action. Home Secretary Rab Butler ringingly proclaimed that the government would "lead the nation in calling for moral values to emerge instead of materialistic appetites." Accused of excessive complacency, Harold Macmillan himself loftily intoned: "When you hear the announcement, you wall not think we have been complacent." In the House of Commons, Chancellor of the Exchequer Selwyn Lloyd portentously lectured that "none of us must be bound by old dogmas."

Last week Lloyd presented the government's measures. They fell with a distinctly timeworn, hollow plop. Among them:

P: A 10% boost in purchase taxes and duties on almost everything a Briton buys, from cigarettes and wine to cars and television sets. Lloyd estimated that the higher prices would give Britons some $588 million less pocket money to spend, presumably cut down on imports, currently running way ahead of exports. In a nation where the average weekly wage is $45, a packet of cigarettes will now cost 63-c-.

P:An increase in the bank rate from 5% to 7%. By making money more expensive to borrow, it will slow Britain's real estate and building boom, help check the forces of inflation.

P:A holdback on government expenditures close to last year's level, to be accomplished partly by asking NATO for help in paying the $182 million annual cost of maintaining British troops in West Germany. The government will also freeze wages in the nationalized industries to hold spending in line and avoid another round of inflationary wage rises. Lloyd expressed the rather wishful hope that private industry and labor would follow suit.

P:Stabilization of the pound in international money marts, by drawing some $2 billion from the International Monetary Fund--a whopping sum equal to Great Britain's total contribution to the fund.

Tall Talking. The measures will get Britain temporarily over its balance-of-payments hump. But after all the tall Tory talking, Britons of both parties had expected and hoped for considerably more; everyone, it seemed, had been braced for dramatic, tough new measures to overhaul the flagging economy. "Is there anything new?" asked the Tory Daily Telegraph. "Where are the stern cures for fundamental weaknesses of the economy we were led to expect? Where is the dynamic doctrine, the fresh stimulus that is to put new drive into the exporter?"

In recent years Britain has slowly but surely been pricing itself out of world markets because of what the London Economist has acidly described as its "monopoly-influenced, trade-union-rigged, subsidy-protected markets at home." In the last decade output per capita has increased a mere 2% a year, while wages and salaries have nearly doubled. The result inevitably is higher prices for British goods sold abroad and a consequent falling-off in the exports by which Britain lives. In ten years Britain's share of the world's export trade in manufactured goods has fallen from 26% to 16%.

In taking the easy way out of the crisis with shopworn, short-term, restrictive measures, Macmillan missed a chance to shake British industry loose from its oldfashioned, uncompetitive ways. In U.S. eyes he was committing the traditional British mistake--trying to re-establish economic balance by reining in the leaders instead of whipping up the laggards. By cutting down the average Briton's pocket money, for instance, the new measures not only cut imports but also home demand, throttle back British industry's incentives to modernize and automate and cut costs in the factories.

Redeeming Act? For Prime Minister Macmillan, who only two years ago ran for re-election proclaiming "you never had it so good," the austerity program was a humiliating admission of failure. In the stormy two-day Commons debate on his measures, the attacks of the Labor opposition had a new, almost rancorously personal note. "It must seem years since he strutted as the mighty Wurlitzer played Mr. Wonderful, That's You and called his troops to battle in an orgy of self-satisfaction," sneered Labor's Harold Wilson. "Now we are in danger of earning for ourselves the gibe 'Sick Man of Europe.' " With shopkeepers hurrying to change price tags upward on practically everything, the British consumer was angry and disgruntled.

In the eyes of friends and foes alike, Macmillan seems to have lost stature. In recent weeks, almost as if they had taken a secret vote among themselves, newspaper cartoonists of all political shadings have altered their treatment of Prime Minister Macmillan; where the tone was formerly one of genial mockery for his Edwardian clothes and languid manners, the cartoonists' drawings have suddenly turned scornful, acid and almost in some cases contemptuous.

His most conspicuous failure of leadership has been on the issue of the Common Market. Most British businessmen are convinced that the economy's long-range problems can ultimately be solved only in the bracing arena of European competition within the Market. The majority of Britons, polls indicate, have come to agree. But Macmillan has hesitated for months on end, and hung back, waiting to make sure of British and Commonwealth public opinion.

At week's end, as if taking his critics to heart, Macmillan summoned his Cabinet and took the plunge: in the next few days, Britain will begin bargaining with the Six for the terms of British entry into the Common Market.

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