2110-8-5-1

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7, AUDLEY SQUARE, W.l.

8th March 1937 •

Every day some new estimate is presented to Parliament - 10, 20, 30 millions, and we begin to lose all count of the cost. Trade improves, and there is every prospect of an unwholesome trade boom: but we feel that in present conditions we shall be better off in 1937, with income-tax at 5/3d., than last year at 4/9d. There is confidence that we can pay, but how serious the burden will be! These increased loans and taxes mature before industry has been able to lay aside adequate reserves, and as the Government expenditure must in the long run be nonproductive, the reaction may be catastrophic. Already the pundits are discussing ways and means for mitigating the slump. Even today the unemployment figures are alarming, and all the time we are at the mercy of a quasi-political strike.

Meanwhile, we watch our neighbours' finance and rejoice that we should be so strong, though our resources and resilience must be ascribed to our having supported industry at the expense of armament and if only Europe keeps quiet during our period of rearmamament, we shall emerge with the most modern of war equipment. How Germany and Italy can go on at their vertiginous height of expenditure we cannot understand. The former must have much more gold, more credit, and more stores - both military & civilian - than we ever imagined; and they are all the more formidable. Our M. I. discount the possibility of a coup-de-main by Hitler, and others say the last thing he wishes is to

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fight us. But then, why does he allow Goering & Goebbels, not to mention the egregious Ribbentrop, to make provocative attacks upon us: and we cannot forget that we possess in Africa the only colonies which Germany is really determined to regain.

France also causes us anxiety. She is in trouble again, and we are busy congratulating her upon solving the latest financial crisis, by the old-fashioned expedient of borrowing, this time £100,000,000. It all sounds simple enough, but as yet there is no evidence that Blum will effectively reduce expenditure or balance his budget. Without such a sacrifice on the part of' the French tax-payer, a new loan will be of small service, no more than his reforms of a few months ago , when he devalued the franc without the counterpoise of reducing public expenditure. I expect Blum is merely postpoining his crisis, and making it all the more acute when it does explode. He is supply and adroit, on the whole making rather a good impression here: but I would trust him no further than I would trust his English analogue, namely, the cunning Mr. Morrison, who has just had a triumph in the London Countil Council Elections. I cannot make out why people are so optimistic about Blum. Anyhow, he seems immovable, and he always sticks very close to us. I look upon him as dangerous, because a fresh collapse in France cannot fail to give Germany new opportunities of mischief. Eden continues much as before, parhaps [sic] rather more easily tired, but always rising to the occasion when he has to make an important speech, and I imagine he must

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be feared in Germany, as they fire off regular volleys of press articles against him. Were it not for the foreign situation, we should be all smiles, but the last few months demonstrate the unreliability of Continental pledges. The movement to curtail our commitments in the League of Nations grows space, and in all parties.

London means to enjoy herself. People begin to arrive, and we talk of a million visitors during the summer who, taking their travelling expenses into account, are expected to spend £50 apiece. As yet there is very small evidence of street preparations, but the parks are already full of stands. Experiments are being made in Waterloo Place with what are called "stagger barriers" - short lengths of strong tube railing, say 8 ft. long x 4 ft. high, and these are fastened into the road 6 or 8 ft. apart, and irregularly spaced, so that nobody can be more than that distance from one of them. This does not interfere with numbers, but it prevents a crowd swaying, by dividing it into small packages. But I expect the public will insist upon standing upon these fences. The Police are giving more and more alarmist hints about the time-table; the latest idea being that people will not be able to leave the Abbey before 3.30, or even 4 o'clock. The old penny steamboats are to be recommissioned for the occasion. For my part, I wonder if the effort is encompassable. One has to wear full Court dress - gold coat, knee-breeches, etc., beneath one's Peer's robes, and as for Coronets, for my part I look a perfect guy in mine, which is about 8

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inches high. The other day I was looking at the costume Abercorn has to wear as one of the K.G 's carrying the King's canopy. The gabardine itself is 60 or 80 year·s old. The thing must weigh 10 lbs., or more, (it is all made of silver lace & brocade), to which must be added a sort of Peer's robe of red velvet, and finally the Garter mantle, a sword, coronet, and I do not know what else. Can you be surprised that we should flinch?

[handwritten] We have just read a sketch of some of your forthcoming tours - really we ought not to complain of our discomforts when you face such effort & exposure!

Yrs

Bal

The Rt.Hon. Lord Tweedsmuir, G.C .M.G., C.H.

P.S.

8 III 37

7 Audley Square, W.1.

We have had 3 months of our new Sovereigns - a contrast almost unbelievable with the last regime. The new sense of confidence pervades us all, and now as we are becoming conscious of our privedge [sic], we realise also that the backwash of the nasty palace crisis is going to break out afresh. The time approaches for the second stage of the Simpson divorce - what will happen then and what will follow? Austria seems certain enough that the decree will be made absolute, and we hear that invitations are already being projected for the marriage. Tours is mentioned (I mean Tours on the Loire) for what reasons I cannot think except that the lady wd not have to cross a frontier, & there may be some friendly Chateau in the neighbourbood.

If it be true that they really mean to be married there, they will presumably import a chaplain, conform to any French regulations about residence & they will attend the civil function at the town hall one midday, she in tailor made costume & hat to match, the mayor in his écharpe & the Duke of Windsor in evening clothes and an opera hat. They may please themselves about their absurd posture, but if as