19th January, 1928
PERSONAL & CONFIDENTIAL
My dear Prime Minister,
Very many thanks for your long letter of the 12th December , in which you comment on many points raised in my letters from the 15th September to the 26th October.
There is one subject which you have not mentioned and that is the Agricultural Economics Report of the Empire Marketing Board. I rather hope that you will find it possible to stimulate interest in Australia in this most important matter. Perhaps I shall hear from you later on in regard to it. 
I am very sorry to read your account of how strenuous a time you have been having recently.  Casey  was able to tell me something about your work and how difficult it is for you to get anything like the competent assistance which can alone make the duties of the Prime Minister of the Commonwealth tolerable. I do hope that better assistance may be evolved, because frankly I feel a little unhappy when I read your remarks about it being an unpleasant job. Given really competent assistance and sufficient of it, the unpleasant aspects of the job would quickly become less. 
I have written you a terrifically long letter by this mail on the subject of the distribution of secondary industries of the Empire.
 I hope that it will prove of considerable interest to you and that you may come to regard the time as being appropriate for the initiation of action along some such lines.
EMPLOYERS AND EMPLOYEES CONFERENCE
To synchronise with the commencement of the series of conversations that are now taking place between the Employers (headed by Sir Alfred Mond ) and the Trade Union Conference, I wrote an article which was published in the 'Times Trade Supplement' but to which the Editor gave a rather misleading title.  I am enclosing a copy which I think may be of interest to you. There may be some occasion on which you might find it worth while to express the idea which I have tried to make in this article that Empire development really means the standard of living of Empire peoples. Put in this way the idea of Empire development ought to appeal very forcibly to those who have been educated in the Trade Union Movement.
IMPERIAL ECONOMIC COMMITTEE
You will be sorry to hear that Lady Chadwick has been very seriously ill for the last six months. Unfortunately for Chadwick , she is in Switzerland and he has been running to and fro between London and Switzerland. He returned last week after the Christmas holidays and told me that Lady Chadwick was on the verge of losing her nervous ability to maintain a brave attitude and that he regarded the next three or four weeks as vital. He felt that he would have to return to Vevey but that this would involve so serious a curtailment of his usefulness with the Committee that he had the possibility of resignation in mind.
I find that Chadwick will be able to move Lady Chadwick to England within a couple of months and I, therefore, offered to spend a couple of hours on two evenings in the week (if necessary) with his staff just to keep them on right lines during his absence from England.
Chadwick was very grateful for this suggestion, which he is going to discuss with Mackinder.  I stipulated that under no circumstances should the members of the Committee be informed of any action of this sort, my main reason being that the Canadian representative  on the Committee has developed a rather definite jealousy which is unfortunate and must be guarded against. 
I very much hope that Lady Chadwick will soon get better, because I think that the work of Chadwick as Secretary to the Imperial Economic Committee is quite essential.
The newspapers are beginning to discuss the possibility of a General Election during 1928. It seems to be felt that the result of the Northampton By-election may be to encourage the Government not to defer their appeal to the country until 1929 but to make the plunge this year.
In this connection there may be some partly political significance in the decision to cut the cruiser building programme for the financial year 1928/29 by 50%. I imagine that this decision is a very adroit move so far as relationship with America is concerned.
The Americans cannot be expected to like it but as far as I can see they will find it extremely difficult to answer. As this country is supposed to be able to build at about twice the pace that America can achieve, I imagine it is a decision not fraught with any real danger.
There are three By-elections pending at the present moment. One at Faversham in Kent with a mixed agricultural and industrial electorate; one at Lancaster and one at Bristol. Should the results of these three By-elections not be unduly unfavourable to the Government, I should not be surprised if a tentative decision were taken seriously to consider a General Election in the Autumn.
Yours sincerely, F. L. MCDOUGALL