Worrisome Waltz of the Wet Hens

When he returned to Britain recently after a fortnight's absence in Washington and Jamaica, Prime Minister Harold Wilson had little cause for cheer. As last week began, the pound fell to its lowest level ever against the currencies of all Britain's major trading partners, down a disastrous 24.9% from the Smithsonian Agreement level of 1971. Any sharper decline would give the nation's already soaring inflation rate of 30% an explosive new thrust. Labor Cabinet members were warring openly over economic policy and the Common Market referendum, and a rash of strikes had slashed output in the automobile, rubber, tractor, aerospace and shipbuilding industries. Hopes that the Prime Minister might take an uncharacteristically firm grip on the situation were briefly raised when he offered to go before the nation in a televised interview.

They were quickly dashed, however. Comfortably settled in a rose-colored easy chair, pipe smoke swirling languidly about his head, Wilson soothingly explained: "While I have been away, in fact nothing has happened. But I come back and find not only journalists and commentators but some politicians rushing about like wet hens as though some devastating crisis had hit the country." He was particularly irked by U.S. Commentator Eric Sevareid, who, after a quick tour of "the kind of cocktail party circuit in the square mile of London where all the hot gossip occurs," had told his American television audience that Britain was "drifting slowly towards a condition of ungovernability" and "sleepwalking into a social revolution." This sort of talk, the Prime Minister complained, filtered back to England and scared people.

More Anxieties. Economic Journalist Peter Jay, Wilson's incredulous interviewer, politely asked if the widespread anxiety might not have something to do with recent economic statistics. The Prime Minister conceded that "we still face the inflationary problem," but all that was needed to control it, he said, was a little cooperation: "What I would like to see is the government sit down at the beginning of each financial year and at intervals thereafter with the trade unions, the employers and all the other useful people in the country and say: 'Now look. This is going to be the total income of the country ... Now if any of you are going to take more in salaries, wages, profits, capital gains or anything than what is left, then either we have to take it back in taxes... or we've got to cut social services.' "

Although Wilson's Panglossian performance was undoubtedly intended to tranquilize the national case of nerves, it created more anxieties than it allayed. Press reaction ranged from mild ridicule to outright contempt. Said the Daily Express: "Mr. Wilson is no white man's Muhammad Ali. Instead he floats like a bee and stings like a butterfly."

Wilson conveniently skirted the realities that provoked Author Paul Johnson, former editor of the socialist weekly New Statesman, to publish a blistering attack on the trade unions and their "gangster" leadership for turning Britain into "a stinking, bankrupt industrial slum." Wrote Johnson: "The movement as a whole is dominated at all levels by men soaked in old prejudices and habits of mind ... negative, obstructive, slow, dull, long-winded, unadventurous men, immensely pleased with themselves and quite determined to resist planned change of any kind."

For the past five years, every British government has been confronted by two intractable problems: how to deal with inflation and how to handle the unions. Labor's strategy was to adopt the "Social Contract": the unions would voluntarily limit their wage demands; the government would work toward a greater degree of "social justice."

The strategy involved a many-sided gamble: that the richer nations, especially Germany and the U.S., could pull out of their recessions in time to buy British exports, which would be competitively priced in devalued pounds; that the government could borrow Arab petrodollars to maintain living standards at home and thus keep the workers happy; that the workers would restrain their wage demands.

Arab petrodollars continue to fuel London, but the Labor government lost on all counts. The world boom did not come along on schedule. Chancellor of the Exchequer Denis Healey had no alternative last November but to reduce corporation taxes or risk major bankruptcies in the very firms that were supposed to be the backbone of a job-creating export drive. The unions protested that Healey was being soft on capitalism, and the big wage demands--now averaging 30%--were not long in coming.

Disaster Course. In an interview with TIME London Bureau Chief Herman Nickel last week, Healey said that he thought the unions might soon be ready to "agree to an [income] policy and also to some genuinely effective means of insuring that the policy was applied." He emphasized, however, that "this has nothing to do with the kind of imposed wage controls that are being urged on us by Americans who violently reject that prescription for themselves."

To be sure, the Labor government is loath to risk any major changes before the country's June 5 referendum on the Common Market for fear that its supporters will retaliate by voting no on the question of remaining in Europe. Although such time-buying may be politically unavoidable, it still accentuates the impression of rudderlessness. Many Britons share the alarm of Professor Hugh Clegg, member of the Labor government's Prices and Incomes Board in 1966-67, who recently warned that Britain is "spot on course for disaster and still accelerating." He added: "Let me say quite clearly what I think disaster is. It is the destruction of the democratic and civilized life in this country by the continual rending of competitive greed at the fabric of society, fomented, encouraged and forced on its way by a leadership too incompetent or too lacking in resolution to provide the conditions in which we can avoid--in five years if we stick to our present course--finding ourselves at the mercy of some cheap dictatorship, whether of the right or left." Harold Wilson would doubtless conclude that Professor Clegg has been attending too many cocktail parties in that gossipy square mile of London.

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