WHERE IS MONEY ?

Auckland Star, Volume LXVI, Issue 223, 20 September 1935, Page 9

WHERE IS MONEY ?

GUARANTEED PRICES.

LABOUR PARTY TWITTED.

MR. W. STASH AS CHAMPION".

(By Telegraph —Parliamentary Reporter.)

WELLINGTON, Thursday.

Guaranteed price references by Mr. W. Nash (Labour, Hutt) when opening the financial debate in the House of Representatives to-niglit were made to the accompaniment of many interruptions, showing keen interest in the subject, especially by its critics, the Finance Minister being promipent in smiling interjections.

Mr. Nash commenced by blaming the Government for following orthodox economists when difficulties arose, thus muddling the solution p.nd accentuating the slump. He contended that immediately national income from exports declined there should have been a greater internal activity, but the Government's drastic retrenchment and wage reduction policy had reduced New Zealand's capacity to buy, thus doubling the trouble. The member for Stratford (Mr. W. J. Poison), he continued, knew something about guaranteed prices, for last session he advocated a guaranteed price of 10d per lb for butterfat.

Mr. Poison: That's not correct. Quote fairly. Mr. Nash: If it is not in "Hansard" I say the member struck it out. lie added that Mr. Poison did positively say he put forward a plan which differed from the Labour party proposal. Mr. Poison: Hear, hear. Mr. Nasli explained that Mr. Poison's plan was to ascertain the payable price at which butterfat could be produced, and if this was lOd but the actual realised price was 7d, then farmers would receive a repayable advance o.t' 3d. When he, the speaker, interjected the question, "Is that not a guaranteed price?" Mr. Poison replied he did not care what it was called. Would Mr. Poison deny writing an article headed, "Guaranteed Price Myth"? Mr. Poison: I'm glad you read it. (Laughter.) Mr. Nash: His gift never has to bo repaid unless the farmer becomes wealthy, because it is not to be a loan. Mr. Poison: You have taken it the wrong way round. Basis For Guaranteed Price. Mr. Nash went on to say that the Government had contended that they could not ascertain the basis for guaranteed price and Mr. Hamilton, examining the Labour proposal, took the average prices over eight years to show the cost to be over £14,000,000 per annum. What Labour proposed was that the primary producer would bo paid a guaranteed price, which would enable him to pay costs and live while everybody would get the statutory minimum wage to enable products to be bought, while those with skill would be paid more. Accordingly, if they were not ablo to work they would still be guaranteed sufficient to enable them to buy goods.

Mr. A. M. Samuel (Thames): In other words, Socialism. Mr. Nash: If that's the term you call giving people a decent standard of living I don't mind. The Minister of Finance, Mr. Coatcs: Why stop at farmers. There are other products. Mr. Nash retorted that the objective was to give good incomes to the people and the farmer would get an income for the work ho did, while others would also get incomes enabling them to buy the goods. The Postmaster-General, Mr. Hamilton, provided the Ministerial answer to Mr. Nash's criticism. He asked why Labour speakers only quoted purchasing power, but ignored reduced prices of commoditiics, which, as lie showe 1 from official figures, had been lowered in a greater ratio than wages. He challenged them to deny that it was possible to get more goods for a pound note to-day than in 1914. Liabilities Plus Assets. Labour members chorused their dissent. "Take your gruel," interjected Mr. H. S. S. Kyle (Riccarton). "They always quote liabilities without giving assets," continued Mr. Hamilton. In respect to the interesting subject of guaranteed prices he would like members of the Labour Opposition to define the term. They said that wheat and fruit prices were guaranteed, but ho denied this. There was Customs duty on wheat and- like other secondary industries it had to find its market level. There was the minimum price of Id per lb guaranteed for exported fruit without reference to a maximum price, but the principal thing he wanted to know from the critics was how they proposed to raise money for the guarantee, and Mr. Nash, when quoting his references to the subject, did not finish the story. It was essential to go further than ascertaining the guaranteed price. They must say where the money was coming from to . pay it. Mr. F. Langstonc (Labour, Waimarino): Will the Minister tell us where the money has gone? (Laughter.)

The Minister repeated his request to be told where the money was coming from. The member for Dunedin South had said they would secure it by taxation of wealthy people and another way was by the issue of credit.

Mr. Langstone: Hear, hear. Mr. Hamilton: I would like that term defined, too. (Laughter.) That money has to come either from taxation or be borrowed or there is going to be inflation. Stand up to it and don't go out to win elections on something that cannot be carried out. Labour, he continued, talked of abolishing high exchange. This would immediately reduce farmers' income by £8,000,000. Then they would have to pay guaranteed prices on the basis he calculated as costing over £14,000,000 annually.