LABOUR'S AIMS.

Auckland Star, Volume LXIX, Issue 229, 28 September 1938, Page 15

LABOUR'S AIMS.

CONTROL OF CREDIT.

MR. SAVAGE EXPLAINS.

ADDRESS TO 8000 ELECTORS,

(By Telegraph.—Press Association.)

CHRISTCHURCH, Tuesday.

The objective of the Labour party in its control of the credit of the countrv was stated by the Prime Minister, the Right Hon. M. J. Savage, this evening, as being first the provision of adequate money to finance production, and, second, the provision cf enough money in the hands of the public to consume the goods produced. No country could be prosperous, he £<aid, when those two factors were out of harmony. Control of credit definitely did not mean that banks and other financial agencies were to be taken over in a night. The Government first demanded service and where that was provided it did not propose to assume the troubles of those providing it. Record Gathering. Mr. Savage spoke in the King Edward Barracks to a crowd of about 8000. Seating accommodation had been arranged for 4500 and a very large section of the audience had to stand. Mr. Savage was given an attentive and enthusiastic bearing throughout his speech, and on entering and leaving was cheered heartily. A loud-speaker system enabled the Prime Minister to talk without strain. The Mayor, Mr. R. M. Maefarlan#, who presided, said that the meeting was the largest political gathering ever held in Christchurch. Mt. Savage said that he had never had so large an audience and to say least it w - as an inspiration. Two Fundamentals. An influential deputation had approached him before the meeting with a request that he should define the Labour party's attitude toward Socialism, said Mr. Savage. Editors apparently were running out of subjects, and ha had therefore been asked to say something about banking and the policy of Labour on that subject. Labour believed that there were two fundamentals ia the financial system of a prosperous country, that money must be provided for production and that money must be provided for consumption. Unlesa the country could buy what It produced trade expansion was impossible.

The Prime Minister said that he was one who believed that unlets the Government of a country controlled the credit of a country it could not control anything else. "I don't suggest that this means socialisation," said Mr. Savage. ; "I am not prepared to predict what will i happen to the money system in this or any other country at any long period ahead, but I do believe that." Economic Freedom. "There can he no freedom unless the mass of the people have freedom to buy, and that ia economic freedom," said Mr. Bavage, "Without economic freedom no nation can ever be free." The clear objective of the Labour party was to teake money the servant of man, of hi* master. During its history money had taken many forms, but they had generally been forms that had little or no relation to the necessities of the people. At be bad Mid at tha Imperial Conference, New Zealand waa setting oat to' base its economy on goods and service* and not on something that had no delation at times to the needs of the people.

"Some of my friends in the banks, the newspapers and the chambers of commerce want to know what we mean by the control of credit," said Mr. Savage. "I want them to know that it certainly does not mean control of all the banks. What we want is service, ao4 we don't care where it come* from. Our objective la to get service from all sections of the community, from the banks, insurance companies, stoek and station agencies and all others. . We want to make the lives of the people worth while.

I Service Required "I Lord Balfour of Burleigh when he came to see me that what we wanted wa» service, and if we got it from private concerns there was no reason why wa should share their worries in giving that service. Let them carry their own worries. If they did not give service, I told him we would provide it ourselves." Another hanker, Sir John Davidson, asked what the Government wanted. He was told that what the Government wanted was to get money into the hands of the people, and advances to those ill industry who needed them. The Government did not want the banks on the eve of an election to tell their clients that their overdrafts would have to be reduced.

Mr. Savage said that he w*l not so stupid that he believed that all wool, IOMt and butter that wae produced in this country could be consumed here, but unteM moa«j »a<U available

people could not buy goods and services that were exchanged for that produce. In this it seemed that the Government should have some control, and, indeed, it did have some control through the banking legislation of the present Government.

War Expenditure. During the war, said Mr. Savage, alterations in Jhe credit system had allowed the nation to finance its war expenditure. The banks apparently in those days could do things that they had not been able to do before and had not done again since. If it was possible to make the nation's credit available for war services, what made something of that sort wrong for the carrying on of the social and other services" of the country? The country would have to do better in future with its financial schemes. If banking corporations would not do it, the Government would have to do it.

Banking corporations in Xew Zealand were doing better during the last two years than they had before, as the ratio of advances to deposits would show. The banks were not doing badly, but it was necessary to have some uniformity. It was useless to have the country swimming in money one year and in the midst of a slump the next. Slump* and booms were regarded as a phenomenon of the trade cycle, but trade cycles were man-made and could be smoothed out by seeing that there was enough money for production and enough money in the hands of the people to buy that production. After all, trade cycles were due to fluctuations in supply and the distribution of buying power. If he wanted to help industry, the proper place to begin, it seemed to him, was to lift the purchasing power of "the fellow down below." It was just as necessary for the nation to be the sole authority for the issue and control of money as it was for it to be the sole authority for the organisation and control of the Army and the Navy.

The Prime Minister was accorded a vote of thanks and confidence, and the meeting pledged itself to work for the return of the Government.