My dear P.M.,

There has been some stirring of the Conservative conscience lately
on the subject of 'safeguarding', the domestic euphemism for
protection. A deputation of 200 Conservative M.P.s approached the
Prime Minister [1] on the subject. Then both Amery [2] and
Joynson-Hicks [3] have made speeches favouring an increase of
safeguarding. Jix said in a speech that has had wide publicity
that 'the Conservative party would have to consider seriously the
extension of the policy of safeguarding to include the iron and
steel industries'. To this the Prime Minister will not agree
although he is fundamentally a protectionist, because of his
pledges at the last election. The subject has the added
complication for Baldwin that he is an important shareholder in
the iron and steel industry and his personal financial position
would be very much improved by 'safeguarding' the industry.

I believe that the policy of the Government is to encourage by all
available means the policy of amalgamation and rationalisation in
the iron and steel and coal industries, so as to enable them to
produce more economically. They will let these industries be
exposed to the cold blast of foreign competition for another
couple of years so as to force this on. If they were to shield and
protect them now, this policy would probably be retarded. The
Government's policy will entail hardship to the extent of letting
the inefficient firms go to the wall, but this automatic pruning
of the dead and dying wood in these industries is considered
inevitable. After they have purged themselves, the question of
safeguarding may be more sympathetically considered.

I hear that Joynson-Hicks has aspirations to be the Prime Minister
designate if anything should happen to Baldwin. He has been trying
to pose as the big man of the Government for some time, but all he
does in reality is make himself ridiculous. His indiscretions are
proverbial. Low [4] has had not a little to do with making the
public regard him as a clown.

I cannot gather that there are going to be any startling changes
in the Cabinet if this Government gets back at the next election.

I hear that Worthington-Evans (Secretary for War) has had enough
of the War Office and wants to go to the Board of Trade. It is
possible that Bridgeman [5] may resign. Balfour [6] may drop out
through age, and I hear that Salisbury [7] may go out of political
life. I expect that Ormsby-Gore [8] will get a move up. There may
be other changes in contemplation but I have not heard of them.

[9]

One of the most interesting domestic developments lately has been
the voluntary scaling down of wages and salaries throughout all
the railway systems of Great Britain by 2 1/2%. This applies from
Directors' fees downwards. it seems to me that the Directors might
have given a better lead than this and have docked themselves of
5% or 10% of their fees. I believe the movement was initiated
owing to the activities of J. H. Thomas [10] and Sir Josiah Stamp.

[11]

I see that Mark Sheldon [12] has added his voice to those of the
other prophets with regard to the urgent necessity for economy in
the Commonwealth. I refer to his speech at the annual meeting of
the Australian Bank of Commerce when he criticised railway
expenditure. I suppose these Delphic utterances do some good in
drawing public attention to the larger aspects of public policy,
but they are meant for domestic consumption and unfortunately have
a wider audience.

I imagine that a not inconsiderable part of your difficulties lies
in the fact that you have but the slenderest of constitutional
opportunities for impressing on the States the urgent necessity
for economy in public works, especially those of a non-
reproductive nature. And amongst these the majority of
developmental railways must be placed, at least in their early
stages.

I met the Archbishop of York [13] at lunch with Geoffrey Dawson
[14] a few weeks ago. He is to become Archbishop of Canterbury
towards the end of the year. He is a kindly man, who likes social
intercourse and dislikes York in consequence. He has not the
intellectual capacity nor, I should think, the character or
personality of the present Archbishop of Canterbury [15], but he
will be, I should think, adequate.

Hastie [16] (of J.B. Were & Son) leaves this week to return to
Australia. I have ventured to give him a personal note of
introduction to you. He is a young, active-minded, well-balanced
fellow and I think he will appeal to you. He is rapidly getting a
very good knowledge of the world's finance.

In conversation with Tom Jones [17] today I heard something more
about the 'safeguarding' stir in the Cabinet and Conservative
Party. At today's Cabinet the Prime Minister is to deliver a
thoroughgoing homily on the corporate responsibility of the
Cabinet and the dangers of ill-timed and ill-considered speeches
of the type that Amery and Joynson-Hicks indulged in lately.

Apart from the fact that this Government holds its mandate from
the electors by virtue of Baldwin's pledge that no further
protectionist adventures are to be considered in the life of this
Parliament, there is a grave danger that the Amery-Jix
'safeguarding' speeches may give Lloyd George [18] the cry that he
is looking for and that he may start to stamp the country waving
the old banner with the dragon of 'dear food' on it. Because it is
held that you can't 'safeguard' iron and steel without doing the
same for agriculture, which is in much the same plight. These
'safeguarding' speeches might be all right on the eve of the
election campaign, as they would sound out the temper of the
country and perhaps pave the way to the Conservative Party going
to the country with its limbs freed from the shackles that now
encumber it as regards a moderate extension of protection.

The Prime Minister goes to Aix on 11th August and will be there
until 20th September. Mackenzie King [19] is going to the League
Assembly at Geneva this September and will visit Baldwin at Aix
(40 miles away). Baldwin hopes to take up with him then the
question of Canada taking an increased number of British migrants,
in the terms of the Report of the Industrial Transference Board.

It is possible that it may be proposed to create some sort of
joint British-Canadian Commission to facilitate and promote
increased migration to Canada.

I am, Yours sincerely,
R.G. CASEY