ir, when I think of the colonies we have lost, of the Empire we
have alienated, of the food we have left untaxed, and the foreigners
we have left unmolested, and the ladies we have left outside, I
confess I am astonished to find you so glad to see me here again.

It is commonly said that our people are becoming hysterical, and that
Britain is losing her old deep-seated sagacity for judging men and
events. That is not my view. I have been taught that the dock always
grows near the nettle. I am inclined to think that in a free community
every evil carries with it its own corrective, and so I believe that
sensationalism of all kinds is playing itself out, and, overdoing, is
itself undone. And the more our scaremongers cry havoc, and panic, and
airships, and sea-serpents, and all the other things they see floating
around, the greater is the composure and the greater is the contempt
with which the mass of the nation receives these revelations, and the
more ready they are to devote their mind to the large and serious
problems of national and social organisation which press for solution
and for action at the present time, and upon which his Majesty's
Government have notable proposals to make.

I come to you this afternoon to speak about the political situation
and the Budget, or rather I come to speak to you about the Budget,
because the Budget is the political situation; and I ask you, as if it
were at an election, whether you will support the policy of the Budget
or not. Let us look into it.

What is the position in which we find ourselves? After reducing the
taxes on coal, on tea, on sugar, and on the smaller class of incomes
by nearly L7,000,000 a year, and after paying back L40,000,000 of debt
in three years, we find that new circumstances and new needs make it
necessary that we should obtain fresh revenue for the service of the
State.

What are the reasons for this demand? There are three reasons--and
only three. Old-age pensions, the navy, and the decrease in the
revenue derived from alcoholic liquor. From those three causes we
require sixteen millions more money this year than we did last year.
Now who has a right--this is my first question--to reproach us for
that? Certainly the Conservative Party have no right.

Take first the case of old-age pensions. I do not think their record
is a very good one on that. They promised old-age pensions to win the
general election of 1895. They were in power for ten years and t