Revenue has increased in this way is in no small measure, I am convinced, due to our low tax policy which has helped to generate an economic expansio… - John James Cowperthwaite

I will not be proposing a course which has been under some public discussion recently — deficit financing. It is wholly inappropriate to our economic situation. In its least extreme form it is based on the theory that additional money generated by a Government deficit (and given currency, as necessary, by use of the printing press) will stimulate consumption and thereby production, in time to match the excess money with goods before real inflationary harm is done. Unfortunately we don't, and can't, produce more than a small fraction of what we consume, and increased consumption would merely mean increased imports without matching exports; and a severe balance of payment crisis, which would destroy Hong Kong's credit and confidence in the Hong Kong dollar; and which we could not cure without coming close to ruining ourselves. Keynes was not writing with our situation in mind. In this hard world we have to earn before we spend.

My own views on all matters of public revenue and public expenditure are conditioned by an acute appreciation of whose is the sacrifice that produces public revenue and to whom accrues the benefit of public spending.

An infant industry, if coddled, tends to remain an infant industry and never grows up or expands.