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[T]he question of indemnity. (Cheers.) Who is to foot the bill? (A voice—“Germany.”) I am again going to talk to you quite frankly about this. By the jurisprudence of every civilized country in the world, in any lawsuit the loser pays. It is not a question of vengeance, it is a question of justice.

You must handle [the House of Lords] a little more firmly, and the time has come for unflinching and resolute action. For my part, I would not remain a member of a Liberal Cabinet one hour unless I knew that the Cabinet had determined not to hold office after the next General Election unless full powers are accorded to it which would enable it to place on the Statute Book of the realm a measure which will ensure that the House of Commons in future can carry, not merely Tory Bills, as it does now, but Liberal and progressive measures in the course of a single Parliament either with or without the sanction of the House of Lords.

The question was whether the Liberal Party was going to be merely a political party which is "the Keeper of the Doctrines." Its sole business would be to see that no man should stray. It would become purely a political sect, strictly, sternly, severely, painfully orthodox, and painfully select. If that was to be its rôle it would dwindle from generation to generation and decade to decade, until it would only have representation amongst the more tenacious races, to one of which he belonged.

There will be no real peace in Ireland, there will be no conciliation until this murder conspiracy is scattered... In vast tracts of Ireland the police were practically interned in their barracks. They dared not come out. Terror was triumphant! ... When the Government were ready, we struck the terror, and the terrorists are now complaining of terror.

There are always clouds in the international sky. You never get a perfectly blue sky in foreign affairs. And there are clouds even now. But we feel confident that the common sense, the patience, the good-will, the forbearance which enabled us to solve greater and more difficult and more urgent problems last year will enable us to pull through these difficulties at the present moment.

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Our more serious devastation was invisible—the shattering of our export trade through our being cut off for over four years from our normal overseas markets. We were the largest international traders in the world and were, therefore, more vulnerable in this respect than any other country. Our customers had been driven either to secure their supplies from rival sources or to start manufacturing for themselves. Indeed, our export trade has never recovered from the War, as the derelict factories of our industrial districts bear melancholy witness. While world trade had by 1927 risen to 120 per cent of the pre-war level, British export trade was only 83 per cent of its pre-war height. That is our real devastated area.

[Y]et we are told that this great nation, with such a record of splendid achievements in the past and in the present, is unfit to make its own laws, is unfit to control its own finance, and that it is to be placed as if it were a nation of children or lunatics, under the tutelage and guardianship of some other body—and what body? Who are the guardians of this mighty people? Who are they? With all respect, I shall have to make exceptions; but I am speaking of them as a whole. ... They are men who have neither the training, the qualifications, nor the experience which would fit them for such a gigantic task. They are men whose sole qualification—speaking in the main, and for the majority of them—they are simply men whose sole qualification is that they are the first born of persons who had just as little qualification as themselves.

[L]et us meanwhile do something for our country, and not always be looking forward to something happening just round the corner. Do not let this country be like that Pompeian slave just discovered in Italy who was found among the ruins clutching the leather bag of his savings. Utilise them!

The hope of the future would be found in a party of sane progress. The present danger was to identify progress with the Socialist Party... It was important, therefore, that they had revived a party which represented sound, sensible, rational progress.

Quite the most difficult problem in regard to labour was that of securing their wholehearted co-operation in the urgent task of munition production—by sticking in the same workshop, keeping good time, working steadily and avoiding strikes; and in particular by consenting to those relaxations of their trade union rules which would make possible an extensive dilution of skilled by unskilled workers, and a considerable use of overtime in cases of emergency.