We enjoy a considerable net inflow of capital and I am sure that a condition of its coming, and staying, is that it is free to flow out again. It is also important for Hong Kong's status as a financial centre that there should be a maximum freedom of capital movement both in and out.
John James CowperthwaiteDeficit financing proper is rather the process whereby a Government spends more money that it withdraws from the economy by taxation, borrowing, running down reserves, etc.; thereby causing in most circumstances, and very acutely in ours, monetary inflation and severe pressure on the balance of payments.
John James CowperthwaiteI am also, I must confess, a little sceptical of the theory that we have a right, if we could, to pass on our capital burden to future generations. I remarked last year in this context that our predecessors had not passed any significant part of their burden on to us.
John James CowperthwaiteI hold that two principles are important; first that there should be a steady expansion of public services, not an irregular one related to revenue accruing in any particular year; the second that taxes should be constant over long periods (provided, that is, that they are neither burdensome nor inequitable).
John James CowperthwaiteI must confess my distaste for any proposal to use public funds for the support of selected, and thereby, privileged, industrialists, the more particularly if this is to be based on bureaucratic views of what is good and what is bad by way of industrial development, but I have been studying the report referred to with some interest.
John James Cowperthwaite