I am confident, however old-fashioned this may sound, that funds left in the hands of the public will come into the Exchequer with interest at the ti… - John James Cowperthwaite

I find odd the view that a Government institution is better placed to evaluate "the technical and financial viability" of a project than a commercial bank. It may well be that our banks are deficient in the kind of expertize required for assessing projects but then what we should be doing is encouraging banks to acquire such expertize or to make use of outside, commercial, expertize. I do not believe in any case that a Government machine can provide a reliable judgement on such matters, an opinion the banking members of the committee appear to have shared, for they have prudently refused to commit themselves to accepting its advice. I myself tend to mistrust the judgement of anyone not involved in the actual process of risktaking.

Economists of the modern school will no doubt protest that I have said nothing of the use of budget deficits or surpluses for the control of the economy in general. I doubt if such techniques would ever be appropriate in Hong Kong's exposed economic position; and I think they are certainly not appropriate at present, when in strict orthodoxy they would suggest the need to plan for a very substantial surplus "to take the heat out of the economy". Although we have in fact run substantial surpluses in recent years we have not done so with deflationary effect because we have not removed them from the economy but have left them inside the Colony's banking system to continue to work for the economy. $500 million or 55% of reserves are so held at present.

If people want consultative government, the price is increased complexity and delay in arriving at decisions. If they want speed of government, then they must accept a greater degree of authoritarianism. I suspect that the real answer is that most people prefer the latter so long, that is, as government’s decisions conform with their own views.