Michael Brunson, ITN
Prime Minister, you were not able to get complete agreement at this Summit on the question of the new trade round. I know you feel that it probably will happen and it probably will happen next year. But would it not have been better if you had all been able to agree that a firm date should be fixed?
Prime Minister
Well it would have been easier. We cannot actually fix the date, because it is a much larger grouping, the GATT grouping, than the seven countries represented here, but I felt that we could give a lead and the overwhelming majority of us did.
Michael Brunson, ITN
And you could not persuade President Mitterrand?
Prime Minister
No, we tried, but we just could not. He was not prepared to commit himself to a date and that, of course, is his right.
Michael Brunson, ITN
The message generally from the Summit seems to be that that we have heard from other Summits, that everyone is on course and there should be no change. [end p1]
Prime Minister
Everyone, whatever country they represented, whatever the politics of the Head of Government, everyone agreed on what I would call a sound financial and money policy, because they said that is the only one you can sustain, and it is only by sustaining that that you will eventually manage to solve the problems of unemployment which, save the United States and Japan, we all have.
Michael Brunson, ITN
But while you have been away, one Cabinet Minister has disagreed publicly with your policies, you have lost ground in the local elections and the unemployment figures are still extremely high. That suggests that some people at least do not agree with your assessment of how the medicine should be applied.
Prime Minister
The unemployment figures, when I saw them, were a bitter blow. They really were. You know, we had had such good surveys from the CBI, we had had such good reports from manufacturing industries, we had had such good reports of new industries starting up and of quite a lot of new technological industries starting up. They really were a bitter blow. I felt very disheartened by them, but I am quite certain that printing money, which is what reflation is, would not help. All that would do would be to undermine the value of the savings of all those old people who have saved for years; not a very honest thing for a government to do, and if we were to start to [end p2] what is called reflate, up would go our inflation, but Germany would not. She would keep hers down and so would Japan, and it would make our goods more uncompetitive.
Yes, I know the paradox that you can see. I can see it. It is difficult to explain to people. Five countries here are suffering from the same. All our economies are growing. Profits are growing. The standard of living is rising. Investment is at an all-time record, and yet with all of that—record output, record standard of living, record investment, excellent profits—we have got unemployment; and there are two countries among us who managed to solve it—one, the United States and the other Japan. And they have solved it because they are really much more “go go” economies than we are. They have much more relationship between wages and the amount produced. You know, in our country, ever since we had prices and incomes policies, people tend to think they are entitled to an increase in wages no matter whether the business can stand it or not.
In the United States and Japan, you get a much closer relationship. They are much more ready to change from one industry to another, even from a manufacturing to a service industry, and they are sometimes much more ready to move, although people will say: “Where do I move to to a job in this country?” But they have solved it because they have got this sort of enterprise culture. Their approach is—each of their people—Look! I am young, I have got health and strength, if I cannot get a job, I must try to start up on my own, and if I cannot get a job at the sort of wages that I want, I must take a job to start with at the sort of wages that I can get. And [end p3] therefore, they have got more jobs than we have, and we really must try to emulate some of the things which they have done, because then I think we can get more jobs. As you know, we have got the biggest Young Persons Training Scheme. Here, of course, they have conscription. We do not.
We have got a community programme to try to help people who have been out of work for some time, and that will go ahead. I just had hoped that it would have shown in this month's figures and I was every bit as disappointed…as other people that it did not, but there is no solution in printing money now.
Michael Brunson, ITN
While you have been here, as part of the Political Declaration of this Summit, you have all been turning your thoughts to 40 years after the end of World War II. There is also, while you have been here, the controversy still raging on about President Reagan 's visit to Bitburg.
Are you concerned that some people, apparently, are not yet prepared to forgive and forget Germany's Nazi past?
Prime Minister
I think we all have to honour our own dead in our own way, but I do not think anyone is going to forget those terrible things that went on, and I do not believe the people of Germany are forgetting those terrible things that went on. I think what we have to concentrate on now is freedom for Germany, for the Federal [end p4] Republic of Germany, began the day the War ended. They had not had it either and some of them also suffered terribly. Freedom began for them that day.
They are now staunch allies, very staunch, in the Western Alliance, and of course, the line—the frontier of freedom—runs straight across their country, between West Germany and East Germany, so they are staunch allies.
Yes, peace is the biggest boon in the world, the peace that we have. We have peace with freedom and justice. I think people who have not actually lived through a world war [do not] fully actually realise what a boon it is to have peace, so that there are not the daily news of the battles, the Battle of the Bulge, the Battle of Arnhem, and the Normandy Landings, the daily news of the bombings, of the doodlebugs, of the enormous fire bomb raids and so on, and the terrible news and the agony on the face of so many people because they had had a personal tragedy.
We have peace with freedom and justice. It is the greatest thing possible, and we have health and strength, and with that we really ought to be able to tackle our own problems, and always to keep the positive, constructive thing going forward. We are allies. We defend, we deter others from attacking us, and we discuss with those who do not agree with us.
Michael Brunson, ITN
Your talk there of the doodlebugs and the bombing raids and so on will evoke many memories for people who lived through that, as you did part of the time. What are your memories of when that finally all came to an end 40 years ago? [end p5]
Prime Minister
I was studying for a chemistry degree at Oxford and, yes indeed, I remember it very vividly. I remember the overwhelming relief, for reasons that you can understand. That part of the war in Europe was over, but there had been terrible atrocities in the Far East and that still had to be tackled. We never forgot some of those people on the Burma Railway and in the Far East. The fall of Singapore, I can remember that. I can remember losing some of our biggest naval ships in the Far East and the terrible thing of Pearl Harbour. All of that I remember, but that day, VE-Day, immense relief that the killing in Europe at any rate was over.
And we all went out in groups. Everyone wanted to be with someone, so because you wanted to share your joy together you telephoned home and always touched base with home, whether in joy or in sorrow. And we went out and into the town together and in the evening there was a bonfire.
But then I can remember—perhaps you would expect it in a university town—we also gathered together in little groups and began to talk: what of the future, what of the new world, because those of us who lived through it can remember that even in the depth of the war, Winston was always thinking about reconstruction and he set up the Beveridge Report and we had all read that. And the Full Employment White Paper came out in 1944 and it was how to reconstruct housing and roads and how to get people demobilised and back and so on.
So we knew that quite a lot of work had been done and there was a kind of confidence that now the war was over and we had health and strength and we had been given a very good education, we could tackle it. We were not going to rely on government; we [end p6] were going to be in partnership with governments. We could enter this period by our own endeavours, our own efforts, our own initiative and our own enterprise, and it was a fantastic opportunity, and always of course, when you are young, there is the great unknown and you long to know the unknown and you cannot.
Michael Brunson, ITN
And one of the unknowns on that day must have been going through people's minds, which said: “Can we really expect peace now to be permanent?” Did you really expect that peace would be permanent on VE-Day 40 years ago?
Prime Minister
I think that we thought that it would be, because we had learned the lesson once you know after the Great War, and after all, it was a so much shorter peace. We did not think that we would have to re-learn it yet again. But do not forget, it was not finally peace. That did not come until August and of course the atomic bomb had not then been dropped, although we all knew that work was going on on these great weapons. We all knew that to some extent it depended upon who got these weapons first. After all, we were getting the doodlebugs and the bombs which were bombs without a nuclear warhead.
So there was still this first uncertainty, but I do not think it ever occurred to us really that there would be another war and, of course, looking back, we know we started with difficulties. Well you know, the Berlin Airlift came very quickly, and the West thought that we were going to disarm quite quickly, [end p7] but while we were doing that the Soviet Union was not disarming so quickly and then, of course, Mr. Attlee had to go ahead with the atomic bomb and then eventually we went ahead with the hydrogen bomb.
But I think we thought that yes, once we had dealt with the Far East, peace would be permanent, but you do not renew this. You do not keep peace by appeasing an aggressor. You keep peace by being strong to deter an aggressor and you will always talk with anyone with whom you disagree to try to reach an agreement. But we wanted peace with freedom and justice. We are prepared to defend that and to deter others from attacking us.