FARM ECONOMICS.

Auckland Star, Volume LVIII, Issue 151, 29 June 1927, Page 19

FARM ECONOMICS.

MATTERS THAT COUNT. "'AMPLE SCOPE FOR ACTION. (By MUSCARIUS.) It is the duty of governments to see that the credit of the country they tepresent is assured by economical administration and the publication annually of a financial statement calculated to show in a plain and reasonable Way the liabilities and assets of that country. No doubt balance-sheets were in the past adroitly arranged to show credits that were entirely mythical, but the affairs of the States of the Commonwealth and also of this Dominion are now almost as easily understandable as the balance-sheets of a large trading company. So far as Australasian credits go we are in the premier position, which is a proof not only of abundant State assets but also of sound public administration, for no empirical government is favoured in the Home money market. Nothing then that is written in criticism of the forking methods employed in our great primary industries can be construed into an attempt to weaken cur national credit or discredit our government. The occasions, however, that at times arise for criticisms of some phases of Departments' administration, although fortunately not numerous, are not to be neglected. At the outset it is necessary to refer, without undue emphasis, to the present period of depression through which we are passing, and which cannot be relieved by the most sanguine expectations for the future. The only optimist of any value to the community is the one who has a basis of reason and ca l ilation for his optimism. The mere continued exportation of high prices for our products in the Home markets is not a sufficient justification for optimism, for "■study of world activities in regard to the purchase and marketing of primary produce goes to prove that the very organisations that should have been employed for beneficent control and fair repayment to the producer are being peed, in the first instance, for depressing markets, and afterwards for profiteering by means of great combines of *orld-wide purchasing powers, transport,) insurance consolidation, economy in agency and storage besides facilities for 'etail distribution. Thus the ideal system of trading has become established, but without the ideal in results. The burden that the farmer groaned under, up of a multiplicity of costly agents, middlemen, insurances, transports, etc., has been lifted, but not to *'s profit, and there is none with vision and power able and willing to assist him; quite otherwise, he seems to be blamed 2*"ery move as well as for every

A Benevolent Air. The attempt to lend a benevolent air to the great "eat trust by seemingly honest publicity, does not, it is hoped, deceive the grower, for to most it has the appearance of a net set in sight of the bird—r-the pretext of benevolent intent, originating in America, is too broadcast and often repeated to succeed. This is merely instanced as one of the magnitudes of sinister combination, 3uch as oppose the producer. Others of great moment are to follow, because wealth must produce and wealth does not exploit wealth, and for all the sophistry that is written about it, the man with invested capital expects a return as well as the man with invested labour. The question that interests us is the division of profits. It appears that wealth is ordained the master, but nevertheless it mav and should exist as a beneficent master in a mutually beneficial co-opera-tion, and it is in such a relationship w> would like to see wealth and the farmer. Eventually this will be brought about to the reconciliation of the three classes of our community, landed, labour $nd wealthv. Our dire need, however, is in the present, for after all the agricultural expert has said with a view to increasing the fertility of the soil and after all the w ; 1-n expressed by araa teurs and masters of farm economics, the national problem still unsolved and still far from solution is, how to help the farmer.

At present some sort of an attempt is being made, but it is doubtful if its importance has not been overstated, and if its inception is not inopportune. Prefaced by the well-sounding phrase that it has been recognised by the Government that the primary producers of NewZealand are passing through a difficult period, a new scheme, of farm economics is being launched as a panacea. There are, as the resonsible department puts it, many theories as to the reasons for the "condition that exists, but inquiries are eventaually forced back to the conclusion that the cost of production is so high that the farmer cannot, under average, conditions, make a reasonable living wage and pay interest on the capital employed in his industry. This conclusion is as old as ancient land tenures, and no system of farm economics is necessary to confirm or explain it away. We find ourselves back at the primary cost of land, and it is the difference between the actual cost and t' •> actual producing value that makes the cost of production dear. No study of farm economics can guide a man in the selection and purchase of a farm, which is merely a business, and the books of a business are the only guide to its value when considered in the light of personality, management, control of capital and other things that do not lend themselves to recora. Locality, figures, and particular locality values "and profits, are not a sure guide to the investor without trained and reliable experience. The most reliable guides are in wool-weight and quality, mutton and lamb production, shees and

cattle-carrying capacity and such others as wonl<i occur to any man of ordinary intellect who intends to take up farming as a permanent business, and not as a speculator, prepare to wait until a wealthy simpleton comes along. Estimating Value of Land. The old way of estimating the value of a eheep run was by sheep, shecp-uni-a-half or two-sheep to the acre, and condition. There was of course ewe and wether country and different grades of that, but the man who knew stock and country never got victimised. nor does the man with knowledge and a level head get victimised except when over-persuaded by the unduly optimistic in regard to the stability of good prices. It was a simple matter to get reliable information on the weight and quality of clips, percentage "of lambs, mortality, cost of running station, etc., and so grazing land" was assessed at £4, £0, or £8 or £9 according to what it was seen to he producing at the moment, and the estimated life and value of the pastures. There- can be no denying that "costing" accounts have their vnlue to the farmer, more particular!v to the fruit farmer and the dairy, b'ce and poultry farmer, for such accounts almost inevitably result in economies; therefore thi< serious attempt is bein- made to find out the actual financial conditions, with values and other particulars, prevailing on a number of farms, with a view to ascertaining how such condition? ailVrt the earnings of the farms.

The outstanding thought in ail thrsrconsiderations is that whero govern ments could be of the greatest value'in co-operative marketing they remain to all intents and purposes aloof and inactive at the receipt of Customs Thev will not interfere as they most fully did during wartime" with profiteering, and make it a crime for or<TanUed capital and trade interests to 'exploit alike consumer and producer. It is hard to believe tn the sineeritv of governments that, holding tbe position and power they do, with equal nbliity. do not make a moving appeal to th« British Government to foster produce distribution at Home in such a manner as shall result in a system of marketing fair to us and to our consumers. The realities of production and sale should be of first importance to all governments. and they have not made them so by such diplomatic representations even, as are given to minor international affairs. In what is almost purely an agricultural and pastoral country one hears of various parties, such as Labour. National and the rest, but the growing wonder is that government should be otherwise than by the primary producers. That, however, is where co-operation should l>? first applied—to a real and personally unselfish union.

Vo scheme of economics will bo n f value to the farmer who farms his own land until he shall receive a fair payment for his When he receives that his land will be worth what it cost. Values are merely relative. Generally land is not relatively too hi?h; but pro duce is sadly and relatively too low. Finally the pitiable part is that governments are almost always in opposition and never in co-operation to ensure the produced getting his reward, preferring costly rivalry to profitable accord.