Dear Mr. Bruce,

IMPERIAL ECONOMIC COMMITTEE

British Government's Intentions

There is still no further news as to the Cabinet's intentions in
respect of the First Report. I gather the Cabinet has not made any
definite decision and, as Mr. Amery [1] left for Geneva on the
Mosul question [2], it seems probable that no statement may be
made this session.

It is a little hard to understand why the Government is postponing
a decision, especially when you remember that, when I got back
from Australia in January of last year [3], both Sir Philip
Cunliffe-Lister [4] and Mr. Amery were tremendously keen on
advertising and, in the case of Sir Philip Cunliffe-Lister,
insisted that more good could be done to help Empire trade by
using the bulk of the 1,000,000 grant on publicity than by means
of the preferences that had not been put into effect. I disagreed
with that view then and I do not know that I am completely
converted now but apparently the forces of indication in the
Treasury are proving a very formidable obstacle.

Sir Halford Mackinder [5] showed me a short letter which he had
received from Mr. Mackenzie King [6] thanking the Committee for
their work and expressing appreciation of the First Report. Sir
Halford stated that he wished to publish this but would much
prefer to do it in conjunction with some cabled message from you
and he therefore asked me whether I would be prepared to cable you
on the subject. After some consideration, I sent on 2nd December
the following cable:

Canadian Prime Minister has written Chairman Imperial Economic
Committee expressing appreciation published reports. Chairman
desires publish letter but would much prefer to have cabled
message from you also. In view Home Government's attitude consider
cable would be useful.

As I understand that Sir Halford Mackinder has not received any
message, I presume that you did not consider it desirable to cable
him an encouraging message at the present juncture. [7]

Work of Committee

The work of the Committee is absorbing a very large percentage of
my time at the present moment and from the general trend of the
evidence and of recent discussions of the Committee, I am now
quite confident that the Fruit Report will be of considerable
value.

The Committee has decided that it is necessary to give the utmost
support to producers' organisations and have therefore decided to
make some form of recommendation deprecating finance of fruit
shipments by British Brokers and Commission Salesmen. I think
that, when finally drafted, the report will prove a most useful
support of the policy of orderly marketing, with which you have so
closely identified yourself.

INTERVIEW WITH MR. ORMSBY-GORE [8]

On December 1st I had a very long conversation with Mr. Ormsby-
Gore. I think I have already told you that he is quite alarmed
with the way in which Treasury influence is able to hold up
progress of Empire questions, so far as this Government is
concerned.

He told me that he had recently had a long talk with Mr. Baldwin
[9] at Hatfield and had strongly urged upon the Prime Minister the
necessity of working out the possibilities latent in a forward
policy on Empire development. Mr. Baldwin agreed and suggested
that a Cabinet Committee might be the best way of dealing with it.

To this Mr. Ormsby-Gore said that he disagreed on the ground that
Cabinet Ministers were too much engaged on detail work to give the
necessary time and thought to so important a subject.

Apparently nothing definite transpired as a result of Mr. Ormsby-
Gore's talk with Mr. Baldwin and he and I discussed at
considerable length how it would be possible for Mr. Baldwin to
clear up, in his own mind, as to what could be done, and came to
the conclusion that a private Committee of really first class men
appointed by the Prime Minister to advise him would be the most
satisfactory method.

Mr. Ormsby-Gore said that, although disappointing, it was almost
inevitable that the Secretary of State for the Dominions (Mr.

Amery) should find himself so immersed in immediate problems that
he was unable to give the sustained thought to the larger issues.

He rather indicated that Mr. Amery allowed himself to work too
hard on detail to the detriment of bigger things. He also
expressed the view that the Board of Trade under Sir Philip
Cunliffe-Lister was not developing the enthusiasm for Empire trade
that was necessary if definite progress was to be made.

Mr. Ormsby-Gore urged that the best way of making progress was by
demonstrating, through questions in the House of Commons to the
Government, the active interest that members of all parties were
taking in Empire affairs. I am enclosing a number of parliamentary
questions and answers which have appeared in Hansard since my last
letter.

LABOUR COMMONWEALTH GROUP

On December 7th Sir Thomas Allen, the Co-operative member of the
Imperial Economic Committee, and myself addressed a meeting of the
Labour Commonwealth Group in the Empire Parliamentary Association
Rooms. There were about 40 Labour Members of Parliament present
and we had a most interesting and successful meeting. Sir Thomas
Allen spoke first for about twenty-five minutes and I followed for
about twenty minutes. After that, we had a long discussion during
which the Division Bell sounded three times and the really keen
interest that the Members of the Group showed in the discussion
may be gathered from the fact that they returned after each
journey through the Division Lobbies.

'CONTEMPORARY REVIEW'

I am sending you a copy of the 'Contemporary Review' for December
as it contains two articles to which I particularly want to draw
your attention. The first is an article by Professor Ramsay Muir
[10] on 'Empire trade and Empire Settlement' in which he discusses
my book 'Sheltered Markets'. Ramsay Muir was a Liberal Member of
the last Parliament and will stand again on the first opportunity.

He represents a very good type of Liberal Free Trader, taking a
vigorous interest in the Empire, and I think you would be
interested to read the article.

The other article that I think you might like to read is the first
one in the issue by Professor Gilbert Murray [11] on 'What
Liberalism stands for'.

This has no bearing on Empire economic affairs but is of really
quite substantial general interest.

I am also enclosing a review of 'Sheltered Markets' by Harold Cox
[12] which appeared in the 'Sunday Times' last week.

PRODUCERS' CONFERENCE

I am enclosing an outline suggestion of the Empire Producers'
Conference which I mentioned in my last letter. I do not know
whether the idea will recommend itself to you or not; it seems to
me on closer study to have some good points and quite numerous
difficulties.

IMPERIAL ECONOMIC COMMITTEE

I have just at this moment heard from the Secretary of the
Imperial Economic Committee [13] that the Prime Minister has
received a cable from you enquiring as to when His Majesty's
Government will announce its decisions on the First Report of the
Imperial Economic Committee. [14] am very glad to hear this news.

I have also been told that the Cabinet has referred the First
Report to a Committee of Churchill [15], Amery and Cunliffe-
Lister.

SIR GEORGE BUCHANAN [16]

I met Sir George at lunch on Monday and had a very interesting
talk. He has asked me to keep in touch with him. He is better
after his severe illness but has lost 20 lbs in weight.

Yours sincerely,
F. L. MCDOUGALL