THE AFTER-WAR BUDGET 115

tion during the war period to the peace period seems
to be extraordinarily short-sighted from the point of
view of the nation's economic progress. Recovery
after the war may be astonishingly rapid if all-
goes well, but this can only happen if every oppor-
tunity is given to industry to get back to peace work
with the least possible friction, and a heavy burden
of after-war taxation, such as we shall inevitably
have to face if our Chancellors of the Exchequer
continue to pile up the debt charge as they have done
in the past, will be anything but helpful to those
whose business it will be to set the machinery of
industry going under peace conditions.

As things are, if we continue to add anything
like £2000 millions a year to the National Debt, it
will not be possible to balance the after-war Budget
without taxation on a heavier scale than is now
imposed, or without retaining the Excess Profit
Duty, and so stifling industry at a time when it will
need all the fresh air that it can get. Apart from
this expedient, which would seem to be disastrous
from the point* of view of its effect upon fresh in-
dustry, the most widely advertised alternative is the
capital levy, the objections to which are patent to all
business men. It would involve an enormously
costly and tedious process of valuation, its yield
would be problematical, and it might easily deal a
blow at the incentive to save on which the supply
of capital after the war entirely depends. A much
higher rate of income tax, especially on large
tecomes, is another solution of the problem, and
it also might obviously have most unfortunate