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Food And Clothing Subsidization Policy by the government of Palestine before 1948 (Nakba), British Mandate: A Survey of Palestine: Volume II - Page 831. Chapter XIX
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Posted on October 28, 2007
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Section 2.


25. The policy of subsidizing essential commodities from public funds was complementary to rigorous measures of control and rationing introduced at the beginning of 1942. The effects of the entry of the U.S.A. and of Japan into the war made these measures imperative if supplies were to be fairly distributed. At the same time it was apparent that prices were reacting to the current and imminent shortages in a manner which would produce the most serious inflation unless a check was imposed. The sale of essential commodities was accordingly subsidized at first as a means of ensuring that the prices of imported basic foods were not beyond the purses of the poorer people and then as a means of ensuring that the basic foodstuffs were available where needed and at reasonable prices. The element of price stabilization has also to some extent been present side by side with the major social objective, to prevent the undue price fluctuation to be expected from variable conditions of supply.

26. The policy outlined above can be effective mainly, if not entirely, in respect of commodities wholly under the control of Government. An experiment was made, for a short period in 1943/44, with the subsidization of the motor transport required to bring vegetables to the main urban markets, with the object of obtaining control of the prices of such produce. It was only partially successful, however, and evasion, coupled with the urgent need of the time to increase supplies, 'led to its discontinuance. Where The basic foodstuffs were concerned, however, the Government was in a position to exercise control. Cereals, oil seeds and sugar were all "pool commodities"; that is to say their supply and distribution were subject to co-ordination as between the Middle East countries by the Middle East Supply Centre in Cairo. These commodities were imported on Government account from the loading areas and through the channels indicated by the Centre which, in its turn, was subject to the higher supply authorities in London and Washington. It was accordingly possible to apply a subsidy effectively to commodities in this class. Meat also was-and in the case of beef, still is (January 1946)under Government control. Meat supplies were in world short supply; local produce could not cover more than a very small proportion of a ration exiguous in itself. Consequently, Palestine's supplies had to be obtained at first through, and later in coordination with, the military authorities. It also proved possible, by reason of Government's control of the yarns imported, to subsidize the manufacture of essential clothing-known as "utility" clothing.