THRIFT URGED.

Auckland Star, Volume LXVIII, Issue 270, 13 November 1937, Page 13

THRIFT URGED.

SAVINGS TO BUY GUNS.

NAZI REARMING PLAN.

BERLIN. Speaking at a savings bank congress at Essen, Dr. Schacht, President of the Reichsbank, referred to the necessity for thrift in helping to finance the German rearmament programme. "The uninterrupted stream of savings which must flow into our economic system to keep it alive can only be kept going through continual thrift," he said. "Such saving is indispensable to guarantee the normal course of our national economics; it is vital when the great burden of rearmament is also imposed. "We sometimes hear that rearmament should be financed by means of taxation alone. That may be all very well theoretically. But taxes, which are really nothing more than compulsory savings, must be reinforced by voluntary thrift." To carry taxation too far, he added, would destroy the mainspring of economic activity and progress. Dr. Schacht denounced inflation as a method of financing armament. "There are actually still people in Germany today," he said, "who are naive enough to believe that the printing of banknotes has lost its terrors because owing to currency control its results can no longer be read every day on the dollar market.

Inflation Dangers. "One thing is certain. If a man refrains from'building a house a gun can be cast from the steel which he saves. Not a single gun, however, can be constructed out of banknotes from the printing press, for notes are made of paper and guns of steel. "But what is more important is that an inflation deprives the exchange of goods of any calculable basis, and an economic system which can make no calculations but depends on chance is doomed. For one man will hoard and another starve, and all production, including that of weapons, will come to a standstill.

"I realised clearly, therefore, when the Fuehrer entrusted me with a share of the task of financing German rearmament that I would depend to a decisive extent on the assistance of the German saver. It is also clear to me that if the State made a claim on the savings of the German people it was obliged to see that these saving* maintained their value."

After producing statistics which, he claimed, refuted foreign allegations that a secret Inflation already existed in Germany, Dr. Schacht rejected the expedient of a devaluation with equal emphasis.