The Auckland Star. WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun FRIDAY, JANUARY 26, 1934. WEALTH AND INCOMES.

Auckland Star, Volume LXV, Issue 22, 26 January 1934, Page 6

The Auckland Star. WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun

FRIDAY, JANUARY 26, 1934. WEALTH AND INCOMES.

For the cause that lacks assistance. For the wrong that needs resistance For the -future in the distance, Avd the good that ue can do

In New Zealand, as in other countries, private wealth and incomes reached a peak in 1929, and then began a world-wide contraction. For the nations which suffered most, the drop in incomes during the next three years ranged up to 40 per cent or more, and kept pace with a disastrous fall in prices. It was the most violent change known in history. In the newer developing countries a wave of prosperity after 1925 lifted incomes annually to higher levels, but such a rate of progress could not continue long. The "United States, the most powerful and the richest of all, had a national income in 1929 of 81 billion dollars, more than four times that of Britain, although the population was less than three times as great. From this pinnacle of prosperity there was a terrific landslide which, in three years, wiped out 32 billion dollars and brought, the United States, size for size, below the British level. It was a staggering blow*, and the shock stunned a population of nearly 130,000,000 people. In 1932, by the standards of many nations, the United States was still wealthy; the average level of incomes was even then 'close to Britain's figures. But the distribution had been thrown out of balance, and among the worst sufferers were the wage-earners.

"Wages in America fell about 60 per cent between 1929 and 1932, according to the latest official survey, "while in Britain they remained nearly stationary, held up by the formidable organised resistance of trade unions in all branches of industry. There was, however, a virtual cut in Britain, which was brought about swiftly and painlessly after September, 1931, by the fall of one-third in the purchasing power of the British pound. Even now, after more than two years, the pinch has not been felt, for the British price level has not risen to reflect the decline in the pound, and the over-supply of food on the market has saved the wage-earners from a rise in the cost of living. British prices and incomes have been steadier than those of any other country, and Britain for two years at least is in the curious position of being fed below cost by the primary-producing countries of the world, regardless of the disastrous consequences on incomes in many lands. Even the Protectionist policy of the National Government has not raised the prices of imported food, but the situation is abnormal, and the real test of Protection is to come.

New Zealand is one of the countries which has lost heavily because of the long-continued glut of the British market, and estimates of the national income show a fall from £150,000,000 in 1929 to slightly less than £100,000,000 in the trough of the slump. An improvement has since occurred, but there is a long jvay to go before the level of five years ago is again attained. Britain is less eager to buy our products than she was, and is developing an agricultural policy of her own, which indicates only one of many changes now in progress in the Old Country. No doubt Britain will continue to be one of the world's most valuable markets, and the Dominions and foreign countries will always attach great importance to this outlet for their products, but will Britain be as rich a nation as when she was the workshop of the world and could defy all competition? "Will it be possible to maintain a standard of life which in 1914 was estimated to be four times as good as it was 120 years earlier, when Britain was just entering upon an era of great development? These are questions no one could answer; only time can tell.