THE WAR AND AFTER.

Auckland Star, Volume XLVII, Issue 158, 4 July 1916, Page 7

THE WAR AND AFTER.

SOME ECONOMIC ASPECTS. LECTURE BY PROFESSOR SEGAR. "Economic aspects of the War." from tho point of view of the student of political economy, was the subject on which Professor tl. W. Seager discoursed to a large audience at St. Andrew's Hall last night, the lecture being under the auspices of the Auckland Institute. Commencing with the fundamentals of political economy, the lecturer explained their application to the case of a belligerent nation, and incidentally made: clear to his audience such terms as foreign and home securities, and the significance to the nation of foreign loans, internal loans, and paper cmreney, of which so much had beeu heard during the present crisis. Thus step by step he made it clear that in the main the financing of the war ultimately means payment by the individual, and that individual economy and sacrifice, decreased consumption and increased production, was the eventual manner by which the price of war had to be paid. The financial expedients by which the nation of individuals might draw in the future, or extend the time of payment, were chiefly, he explained, taxation, loans, and the issue of additional paper money, each of which had its limitation. He further explained, however, that so long as a. country produces the commodities and services for its army, and accepted paper currency in payment, it might, in the case of a country like ( Germany, keep its army indefinitely in ', the field. ' ' j The lecturer explained at length the i significance of taxation and of interna; \ loans as means of meeting tho situation, j and, incidentally, he commented strongly j and adversely on tho 5 per cent income : tax which, ho said, was levied without any reference whatever to responsibility. : In illustration, he pointed nut that a I bachelor with an excess of £2DO aj year of income over expenditure could | much more easily moot the tax than could a man whose excess of income was £500, but who was burdened with heavy family responsibilities. This, when the Government had at hand the expedient of the graduation tax, by which they could have fairly met the situation by putting the burden on the wealthy and the super-wealthy. Proceeding, Professor Segar showed how, in effect, the burden must by loans and taxation, fall very heavily on the working classes. Dealing with the export tax. ho showed how that, too. would, in cases, act inequitably by falling on the largo fanner and the small farmer alike. Explanation was made of the effect of inflation by these national expedients for financing the war. though the Professor quoted authorities to show that ihe finances of tho F.mpire were perfectly sound and stable, and well able to meet tho tremendous strain. After tho war. ho said, our motto would have to be decreased consumption and increased production, and he showed what a very difficult situation would have to he faced in converting the nation's industries organised for war into industries organised again for peace, with a national debt of C 5.000.000.000 to overtake. The nation's stock of commodities would have to bo restored, the depreciated machinery would have to be replaced, tho war damage repaired, the paper money redeemed, and, with it all, there would bo tho industrial problems arising out of female laboirr. tho reinstatement of the millions that wont to war, and the cessation of separation allowances and war bonuses. Added to that, capital would be short, and whether or not interest would be low or would rise would bo determined by whether or not investors were nervous of drawing their money from Government securities to invest in tho rebuilding industries. The lecturer also pointed out that in the commercial war following on the military war Britain would have to be waTy of any unconsidered boycott of CJermany, lest the action recoil on herself and merely have the effect of throwing the trade into the hands of the United States. One point ho stressed was that whatever economy the nation had to practise, it must keep clear of the temptation to economise on education, for it was only by the encouragement of applied science to industries, thrift in consumption, and unification of tho parts of the Empire, that Great Britain would eventually win in the world's markets.-