LABOUR AND MONEY.

Auckland Star, Volume LXVI, Issue 269, 13 November 1935, Page 27

LABOUR AND MONEY.

I road with great interest your leading article on Labour and money, notwithstanding the fact that I fail to agree with several of the main points raised. The control of currency <ind crcdit as it exists under our present banking system is certainly of vital importance to every citizen; unfortunately, there is no other subject of equal importance concerning which there exists so much ignorance and misconception, which is probably due to the fact that the bulk of propaganda on this subject emanates from exponents of the present system. Yet it is a subject to which should be given the most impartial and unbiased study and attention, for as Lord Milner put it, "it is of no use dealing with present-day economic problems unless 0110 has a perfectly clear conception of the money, the banking factor, which under modern conditions is of such supreme importance." Dealing with Mr. Savage's recent address on banking reform, you state: "No other country in com parable circumstances has adopted that view ..." May I draw your Attention to the fact that Mr. Mackenzie King—the newly elected Canadian Prime Minister —fought the recent election on the straight-out issue of the State control of banking and currency. "Canada is faced with a great battle between the money power and the power of the people," he said in his policy spqech, "and until the control of currency and credit is restored to the Government, and recognised as its most conspicuous and sacred responsibility, all talk of sovereignty of Parliament and i democracy is idle and futile." On this definite and uncompromising policy, Mr. Mackenzie King made his appeal to the people and swept the country with a victory unprecedented in the history of Canada. That the same "money power" determines and dominates financial and economic conditions in New Zealand is a view shared evidently by the former Minister of Finance, Mr. Downic Stewart, who before an Auckland audience a little over twelve months ago said: "We cannot take money from London financiers and then ignore the rules they lay down." As a young country with undeveloped resources and an expanding production, New Zealand is likely to require a steady flow of additional capital for many years to come. To continue the present practice of developing our national resources by means of debtmoney ancl tlius adding indefinitely to an already intolerable debt burden, which we know can never be liquidated, must seem incongruous to the intelligent citizen. In my opinion the National Government has" only itself to blame for the consistent demand for monetary reform and the numerous banking and currency systems that are being advocated. State banking is, in my opinion, a compromise betweefi social crcdit and the present banking system and if soundly and judiciously applied will result in great and lasting benefits to the people of this country. During the four years of its existence, the Government lifts shown no inclination to employ financial methods more in keeping with the progress made in the spheres of production and manufacture. By handing monetary control to a semi-pri-vately owned Reserve Bank and by burdening the country with a heavy exchange rate and endeavouring to correct political shortcomings by ruthless economy, the present Government lias greatly prejudiced the present banking, system and has indicated clearly that money is, more than ever, the master of: man, instead of man being the master] of money. In the State control of credit j and currency I can see the only hope of j the country making its cscape honourably from 'an ever-increasing burden of indebtedness. | HENRY J. KELLIHER. I