573. H. D. Henderson to Harrod , 10 June 1936 [a]
[Follows on from 569 ]
14 Upper Park, London #
10 June 1936
My dear Harrod,
I think I exaggerated in implying that there was a general tendency to sneer at the business man in your book, being moved to this generalization by the particular passage which I had just been looking at (p. 304)  which you have now amended. It was the phrase "with his outlook" there which chiefly gave me the impression of a sneer, and I think your [b] amendment meets that completely. (Your panegyric on pp. 227-228, however, relates to politicians.  ) None the less, I have a general point relating to tone, though I find it hard to express it. As I read the practical proposals, I get a sense of a singular naïvete in the implied suggestion that proposals so heterodox in character and running so counter to instinctive feelings of wisdom could reasonably be adopted on the basis of analytical generalizations which cannot claim to be more than extremely tentative. I mention the point because I think you could fairly easily meet it without sacrificing anything to which you are attached. All you need to do is to insert at some appropriate place a paragraph to the effect that it is interesting to see what practical conclusions follow from the analysis, that the reader must expect to find that these conclusions are often of a startling nature which may appear to him unsound, that indeed it would be essential that the diagnosis should be far more definitely established and confirmed by experience before these proposals could be advanced seriously as practical propositions; but that none the less in view of the possibility that the experience may confirm the analysis it is useful to explore what sort of conclusions do follow. In connection with public works you come very near saying this, but it would help if you could say it more emphatically and more generally. I would stress the point I think I made in conversation that Governments never hand over to Commissions any functions except those of a limited, technical, clearly defined character, and that the notion that Governments could bind themselves and their successors to submit to the decisions of a body of pundits on matters of central financial policy is from the politico-administrative standpoint fantastic. Furthermore, of course, it would be in the highest degree unlikely that any Commission that might be appointed would look at the problem through your eyes at all. You want to convey clearly therefore I think that your proposal is essentially Utopian in character rather than a carefully weighed practical proposition.
As regards points of detail, pp. 142-143:  of course if people spend £ 500 on furniture where they used to spend £ 1,000, your point holds. But is this what happens as the result of diminished durability and increased fashion changes? The last sentence on p. 142 suggests that the total charge for capital goods, i.e. interest plus depreciation, is likely to increase in the case of the industrialist. Isn't this likely to hold good also of private individuals, leaving the important difference that the latter don't maintain sinking funds? But this point is really of little importance.
I don't think I have any other points of detail: I leave [c] the more general issues to discuss when we meet.
H. D. Henderson
R. F. Harrod, Esq., Christ Church, Oxford.
2. Harrod, The Trade Cycle ( 1936:8 ), p. 173.
3. Harrod, The Trade Cycle ( 1936:8 ), p. 103.
- a. TLS, two pages (the first being numbered) on two leaves, in HP IV-480-484.
b. Ts: «you».
c. Ts: «Leave».
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