Commentary (The Times)

Budget: "Professor urges Chancellor to balance Budget now" (Hayek at IEA lunch) [wants "referendum to rescind every single [union] privilege"]

Document type: Press
Source: The Times , 29 Mar 1980, p2
Editorial comments:
Importance ranking: Major
Word count: 252
Themes: Conservatism, Monetary policy, Trade union law reform

Professor urges Chancellor to balance Budget now

By a Staff Reporter

Sir Geoffrey Howe, QC, the Chancellor of the Exchequer, should have aimed at balancing the Budget immediately, rather than over five years, Professor Friedrich von Hayek, the economist and Nobel prizewinner, said yesterday.

Professor Hayek, who was giving his critical view of Wednesday's Budget at a lunch at the Institute of Economic Affairs in London, also said that tackling the problem of trade unions was more urgent and important than pursuing a sound monetary policy.

"I am convinced the only way to restore the market in the field of wages is to appeal to the people by referendum to rescind every single privilege granted to trade unions which the ordinary citizen does not possess", he said.

"If you ask people whether they wish trade unions to be subject to the law and not have any special privileges, you would get an overwhelming result."

Professor Hayek went on: "If I were Chancellor I would have aimed above all at balancing the Budget, not over five years, but here and now, making myself independent of any money I could borrow.

He suggested that the Government should have decided to finance its Budget by raising a long-term loan not in sterling, but in terms of raw materials. " The British Government still has sufficient international reputation to get loans on a stable unit ", he said.

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