GUARANTEED PRICES

Press, Volume LXXVI, Issue 23194, 4 December 1940, Page 14

GUARANTEED PRICES

to the Eorros or the peess. Sir,—Farmers are foolish if they allow the guaranteed prices question to become a mere plank in the political boardwalk. The dairy farmer has not got all he is entitled to, perhaps, but without the guaranteed price he had no voice in fixing the value of his services. His voice is now heard in the land not as heretofore, when he * was economically a useful but dumb beast. Can primary products be guaranteed a price in local currency that is not in harmony with export values in another currency? Yes. Broadly speak--1 ! ing, ’-what would result from a lack ' 'Otodentity between prices here and fluctuation in the currency corresponding price

of the product, completely so in regard to imports and to a lesser extent in goods produced locally. What advantage might be expected from such •an arrangement?— Violent fluctuations in prices overseas would not be so disastrous to mortgaged farmers as such fluctuations would be reflected in the value of local currency rather than in its volume, and so the consequent reduction in materia} prosperity would spread evenly over all users of currency. The volume of wages, interest, and sales of produce would be maintained, their value would fluctuate. A guaranteed price cannot prevent variations in economic prosperity, but it can spread the effect more evenly both as regards individuals and periods of time. Such a price cannot usefully vary in response to an increase in overseas values or the reverse, and so might be deflationary or inflationary at times; but it should be responsive to local costs and its major advantage would.be stability. There is in the background of the idea, plus the Arbitration Court and a sincere desire for social and economic justice on the part of people generally vast potential utility. When people desire privilege for themselves and injustice for others it lacks the!'seamy, cover essential for their verminous comfort.—Yours, etc., H. J. BUTTLE. Darfleld, December 1, 1940.