COSTS AND VALUES.

Auckland Star, Volume LXVI, Issue 159, 8 July 1935, Page 6

COSTS AND VALUES.

LIVING WITHIN OUR MEANS.

(To' the Editor.)

Mr. H. 0. Mellsop has strangely failed to show us how we are to meet costs that are beyond our resources and he has equally failed to show us that our present distribution of income has any basis in equity. The increases of rates and taxes that have occurred during the last thirty years mean simply that thirty years ago our production was valued at forty-, live millions, and roughly one-tenth of that amount was taken in rates and taxes, whereas now our production is valued at eighty-four millions and almost one-third of that amount is taken in rates and taxes. Whether we can afford that increase in the cost of public service, and whether those rendering private service are fairly treated under such an allotment of our outpiit, are questions that have no connection at all with prices. Prices might be "guaranteed" at double their present level, and the required amount of money might be provided by inflation, but if rates and taxes were equally inflated our position as regards public costs would be precisely what it now is. On the other hand, if prices were doubled and rates and taxes remained unaltered, their real value would be cut to half, and they could be cut to half equally easily without inflation,, the difference being only that the latter method wduld be. straight and fair, while the former would be devious and dishonest. Nothing surely could be plainer than the fact that while one section of our population may be allotted an undue share of our output, we cannot all have an undue allotment, and thus adapting costs to returns means merely living within our means, and if we have anything else to live on, can Mr. Mellsop show us what it is? J. JOHNSTONE. Manurewa.