MONEY IS NOT WEALTH.

Ashburton Guardian, Volume 62, Issue 41, 28 November 1941, Page 4

MONEY IS NOT WEALTH.

“I would emphasise again that the function of taxation in wartime is not merely to defray from revenue as much as possible of the current expenditure of the Government, but to check the development of an excess of purchasing power over the available supply of goods and services,” said the Chancellor of the Exchequer, Sir Kingsley Wood, speaking in the House of Commons. ‘‘Unless this purchasing power is removed from people’s pockets inflation would result. Inflation is caused when the amount of money in the hands of the people increases at a greater rate than the supply of goods and services. The danger of inflation in wartime is intensified by reason of the fact that while the amount of money is increasing the goods and services are actually diminishing. It is absolutely essential that serious infla-* tion should be avoided, and it cannot ‘be too strongly urged that every effort should be made by everyone throughout the country to avoid unessential spending. We have come to regard money as wealth, and for this reason it is perhaps a little difficult for the man in the street to realise that money is not wealth in itself and is quite useless if there are no goods to buy. This is an important lesson we have to learn, and the sooner we learn it the better it will be for the war effort. But having learned the lesson, let us not forget it when peace comes. When at last our tremendous exertions are over and we can return once more to the fields and factories to produce the food and clothing and the goods of all kinds 'which are now, owing to the war, in such short supply, unless we have learned the lesson that money is not wealth, we may make the same mistake that we made after the last war.”