RECKLESS BORROWING.

Auckland Star, Volume LI, Issue 229, 24 September 1920, Page 8

RECKLESS BORROWING.

» ;To the Editor.) Sir, —In your issue of Saturday there is a short list of loans —sanctioned by the Government —to be raised by nine local bodies, including Auckland City, amounting in all to £1i30,000. The significance of it lies, not in this particular amount, but because it is illustrative of what is going on throughout the Dominion at the present time. Cities, towns, townships, and every centre however small, seems to be engaged in arranging loans for public works, the total of which must run into many millions, and this at a time when money, labour, and material are at high and ever-increasing prices. It is aa if a spirit of recklessness, amounting almost to madness, lias come over the people of this country. Putting the matfier shortly, it will take two millions of money to carry out work that—before the war —could have been done for one million, and what is there to justify this extra vagance ? The country has, through war expenditure—which was absolutely unavoidable—been heavily loaded with debt, to meet the interest and sinking fund up.on which taxation in every conceivable form is being imposed by the Government, who must raisp. the money somewhere, and now the public, through their local bodies, are doing their utmost to increase these debts and consequent taxation. No one questions its value or the necessity of tho proposed public works, or the wisdom, if they arc to be done, of carrying them out by means of loans, the repayment of which, being | spread over a number of years, falls comparatively light upon the ratepayers; but in view of the present position, which clearly shows that the available labour is not sufficient even to carry on the existing industries of the country, unci the price of all materials is so high that one pound sterling will not buy more than ten shillings worth of goods, and to obtain that pound requires a higher rate of interest than was paid before, it seems almost madness to go in for extensive borrowing. Such a policy, if pursued under these circumstances by a private individual, would be characterised by everybody as leading directly to the Bankruptcy Court, and yet what are the Government and local bodies but individuals in the aggregate? Another and very serious aspect of this borrowing question is that almost the whole of the proposed loan money is to be spent in the towns and other large centres,- to the neglect of the undeveloped country lands that are to be met with on every side where money, if cheaply obtained and judiciously expended, would reeult iA a direct and immediate gain by increasing the volume of farm and dairy products, upon which the whole Dominion depends for its welfare and advancement. T may be quite wrong in my remarks, and write subject to correction, but surely, if there is a single feature outstanding at the present time, it is the need of caution in public and private affairs I am, etc.. K. Q. SHEPHERD.