Dear Mr. Bruce,

1 . IMPERIAL ECONOMIC COMMITTEE

On the 23rd instant I received the following cable:-

Sir Mark Sheldon [1] has accepted position senior Australian
Representative Imperial Economic Committee and Government invites
you to act as Australian other representative during initial
portion work of committee (stop) Will be glad receive urgent
advice as to whether you are willing act.

I immediately cabled you in the following terms:-

Reference your cable 23rd Imperial Economic Committee shall be
glad to act as desired by Government.

I am assuming that your intention is to vary the Australian
representation on the Committee from time to time so as to secure
the presence of experts who may be available in London. I shall
await, with very much interest, a letter from you on this subject.

I heard from Alan Ritchie [2], who tells me it is probable that he
will be coming over to undertake certain work in connection with
the Economic Committee.

Sir Mark Sheldon has been out of London since the announcement of
the Australian appointments and I have, therefore, not yet had an
opportunity of seeing him. I should like to assure you that I
shall do everything in my power to assist Sir Mark and I have
particularly noted the fact that he is the Senior Representative.

I hope that you will make it clear, in the near future, as to how
you propose to provide for continuity in the work of the
Australian Representatives.

2. MEMORANDUM ON THE VALUE OF EMPIRE MARKETS

I sent a copy of my memorandum, a copy of which was forwarded to
you on the 5th February last, to Mr. Baldwin [3] and I ventured to
suggest to him that if he considered the document of sufficient
interest, it might be desirable for him to pass it on to the
Chancellor of the Exchequer. [4] I have received a letter from Mr.

Baldwin stating that he read the memorandum with the greatest
interest and has passed it on to the Chancellor of the Exchequer
with a word of recommendation.

I am particularly glad that this has happened, because I am most
anxious to get the facts in relation to Empire trade and the
efforts which Australia has made in this direction prominently
before the Chancellor before he makes his Budget Speech.

3. THE LABOUR PARTY AND FISCAL POLICY

Since my last letter, a very important development has taken
place. I am enclosing cuttings of an article by the Rt. Hon. John
Wheatley [5], M.P., and another by Mr. Tom Johnston [6], M.P.,
which were published in 'Forward' of February 21st. This paper is
the organ of the Scottish Labour Party.

On Tuesday last, Mr. Tom Johnston had lunch with me and told me
that he anticipates getting 50% of the Parliamentary Labour Party
behind Mr. Wheatley and himself in this new attitude to the
importation of sweated goods. [7] Mr. Johnston states that, during
the initial stages of this new movement, he intends to concentrate
upon a definition of sweated goods as being goods produced in
countries in which the 48 hour week is not operative. For the time
being he intends to avoid complicating the subject by any
reference to wages or conditions of work other than the 48 hour
week.

I was very interested to hear from Mr. Johnston that so staid a
free trade member of the Labour Party as Mr. Arthur Henderson, the
late Home Secretary, had stated that it would be impossible for
the Labour Party to resist the point of view which Mr. Wheatley
and Mr. Johnston were now advancing.

I propose quietly to keep in as close touch as possible with this
movement because its full implications are obviously of such great
interest to Australia.

I hope to be able to advise you, within the next week or
fortnight, as to what effect this new development of the Labour
Party will have upon the British Government's attitude as regards
fiscal preference.

4. ROYAL COMMISSION ON FOOD [8]

Many of the newspapers arc complaining of the way in which Sir
Auckland Geddes [9] is acting as Chairman of this Commission. The
Labour Party is also up in arms on the same subject. The
complaints are to the effect that the Commission appears more
anxious to safeguard vested interests than really to probe the
problem. One hears comments from all quarters as to the
extraordinary way in which Lord Vestey [10] was allowed to state
his case, without effective cross-examination.

So far as I have been able to observe, Sir Halford Mackinder [11]
has also adopted an intensely conservative attitude. The
Commission has examined many witnesses in private and it is
impossible to say what conclusions will be reached but I think you
will be interested to know that, at present, well informed people
do not anticipate much progress as a result of the Commission. If
this proves correct, it will intensify the need for careful and
thorough work by the Imperial Economic Committee which, I assume,
will have the advantage of working in private.

Yours sincerely,
F. L. MCDOUGALL