Sad Salute to Fact

Almost down to the last dread detail, it was the speech that had been forecast for weeks by diplomats, economists and the whole Fleet Street press corps. Still, as Prime Minister Harold Wilson rose before Parliament last week and methodically ticked off his program "to make devaluation work," the import of his words made the occasion historic. "We have come to terms with our role in the world," announced Wilson. "Our security lies fundamentally in Europe." And even the world's hardened realists, who had said it for years, seemed to cringe at Chancellor of the Exchequer Roy Jenkins' sad salute to fact. "We are recognizing," he told the House of Commons, "that we are no longer a superpower."

Tethering British defense to Europe will permit Wilson to hasten the withdrawal of 35,000 troops stationed in the Far East and to clear out of two Persian Gulf bases as well--all within three years. Thus by the end of 1971, except for the 10,000-man Hong Kong garrison and a few other colonial police details, British arms will be deployed no farther from home than the Mediterranean. With the cancellation of an order for 50 U.S. F-lll swing-wing jet craft, saving $1 billion over ten years, Britain's up-to-date nuclear-delivery muscle will be reduced to four Polaris submarines. A post-1971 phase-out of all aircraft carriers will drastically cut Britain's fighting mobility.

No. 2 Power. Though these cutbacks will eventually bring hefty budget savings (some $600 million a year by 1972), there was no way for Wilson to siphon off enough current defense funds to finance an immediate increase in export production, which is Britain's only hope of reversing its balance of payments deficit. For that, he had to dip bravely into his own Labor Party's social programs: an end to free milk in secondary schools, a moderate (300) charge for National Health Service prescriptions that will apply to medicine for most people between ages 15 and 65, a freeze on civil service hiring, and a means test for the next increase in family allowances. Most serious of the domestic slashes is the postponement for two years (until 1973) of a planned raise in the legal school-dropout age, which at its present level (age 15) is allowing four-fifths of the nation's students to quit before completing secondary school.

Spared by Wilson's ax were two expensive investments in the future being undertaken jointly with France: the Concorde supersonic airliner, due for its test flight this spring, and the Dover-to-Calais Channel tunnel. Nor did Wilson mention tax increases in his 45-minute speech--an omission that caused a brief flurry of bullish activity on the London stock exchange. Within hours, though, Jenkins--a hard-nosed economist who was Wilson's chief aide in ramming the budget cuts through the Cabinet, and in the process established himself as Labor's No. 2 power--dashed any thought that economic growth might lead to bigger paychecks. "The faster money incomes increase," he said, "the harsher must be the tax increases."

Drained by Debate. Tory backbenchers peppered the Prime Minister's speech with caustic cries of "Hear, hear!", hoots of laughter and shouts of "Resign, resign!" Distrustful financial analysts doubted that spending had been reduced enough to stiffen the pound, and Laborites were bitterly resentful of the domestic curbs. For all the pained outcries, however, only one Cabinet member resigned--Lord Longford, leader of the House of Lords. The rest of the Cabinet, including some who had been expected to leave, stayed on with the justification that no single Cabinet department had been singled out to bear the brunt of austerity. But it was a sullen Commons that gave Wilson, drained by two days of debate, his vote of confidence. The vote was 304 to 9, with all the Tories and the 26 breakaway Laborites abstaining.

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