Industry and Tariffs.

New Zealand Herald, Volume LXIII, Issue 19485, 15 November 1926, Page 18

Industry and Tariffs.

*a w EAR by year it becomes more widely realised that secondary industry, which, actually, is just as " primary " as the industry which serves overseas markets, is part and parcel of the economic life of the Dominion, that it is as great if not a greater factor in increasing population as the land, and that it ought to be supported by every section of the community. That it is not supported with, say, the enthusiasm of the Australians for the products of their own factories is evidence of a lack of appreciation of the value of manufactories to the country and a thoughtless disregard of mutual .interests. In the first place support of local manufacturing industry represent; trade within the Empire in its best form, which is trade within the country. Seeing that it cutrf out sea transport charges and that it provides employment and hence an increased local market for primary produce, it deserves some fiscal protection but those who take the wide view, who wish to see all-round development, will not advocate protection in such degree that competition would be eliminated, . prices kept at an artificially high level, and the incentive to factory effort and efficiency diminished. Farming opinion is becoming more and more hostile to the protectionist policy, but probably it would be found that moderate, thoughtful fanners and manufacturers would agree that protection to the degree now operating is wise and necessary, that it is helping New Zealand toward her destiny but that its benefits to manufacturers should not be generally increased. The reason for their agreement would be recognition on the farmer's side of the fact that secondary industry ia building up population and providing a greater local market for land produce and, on the other, recognition of the fact that present conditions in general | enable manufacture to secure reasonable prosperity and expand, and ~~ ' ' that it would not be to national well-being if the farming population had its difficulties increased by the higher prices which increased protection would tend to bring about. It is afgued sometimes that increased protection would not result in higher prices and Australian experience is quoted in support, but it must be remembered that iindustry in Australia is much nearer mass production than New Zealand industry. It has been stated that manufacturers would undertake not to raise prices if the tariff wall were made higher, but as far as the Auckland Provincial Industrial Association is concerned it does not support the Canterbury request for a 10 per cent, increase, althought it is most anxious that the law relating to dumping should be more strictly enforced. There is really no ground for,conflict between the two branches of New Zealand industry and no justification for hostility among the farming community toward manufacturing interests, yhe common rural attitude of mind toward the cities is based upon the inaccurate assumption that they are purely trading centres, passing on goods at too high a profit. It disregards the fact that a substantial portion of the urban population is engaged in the creation of useful goods. The pity is that the proportion is not greater and it is a matter for regret that New Zealand-made goods should so often be passed over without the vestige of Reason. Obviously the land earns the national incoma but local manufacture reduces the debt abroad which the land must discharge. Is it not also obvious that a pair of boots or a pair of blankets is as important in the economic scale as butter or cheese of equivalent value eent to London, provided these articles giva fair value to the buyer?- which they and almost every other article manufactured in New Zealand unquestionably do f " But," someone remarks, " the less we buy in Britain the lower will be the purchasing power of the people there for butter and cheese and meat and wool." Admitting that this is so, the reply is that the less we buy of New Zealand manufactures the lower is the purchasing power of the people of New Zealand for butter and cheese and meat and wool. The principle is exactly the same with tha added benefit in the latter case that there Is no sea transport and no exchange, and a far more direct relation between the manufacturer's pay-sheet and the farmer's cheque. Slumps in the price of produce on the London market are immediately reflected in local financial stringency, but as manufacture expands the less will London fluctuations disturb New Zealand's economic life. The ideal to aim at is to develop those industries which may obtain their raw materials in .the country. Consider footwear! If the hide that comes off a fat Now Zealand bullock is tanned in a New Zealand tannery and is made into boots in a New Zealand factory to be sold to a Mew Zealander, the result is far and away better than exporting the hide and importing boots. Better still would be' the result if there were more mouths in New Zealand to eat the beef of the bullock. As a matter of fact the tanning and bootmaking industries are doing splendid work with local material. The woollen mills in certain departments are excelling in goods made from New Zealand wool. Splendid rugs, both travelling and floor, are being produced; and if there were scores of such groups of industries catering for the bulk of tha local trade in their lines fickle overseas markets for the products of the soil would be of much less importance.