WARTIME ECONOMY.

Auckland Star, Volume LXXII, Issue 87, 14 April 1941, Page 4

WARTIME ECONOMY.

PROBLEM OF SHIPPING. HKI>K HON IN CONSL"MI »TION. Discussing the I'ffcct of a possible uOl scning of an already difficult shipping position, the National Bank of Australasia. in its latent monthly summary. sa\s that a marked shrinkage in imports could not readily be overcome by local industries. while the iitljuc tir.cut of ijrini a reproduction t<.> a seviir- lontractiort in the iiuaiitity oi goods .-hipped from Australia would Ik sdow ami troublesome. The

ssocialed financial "problems would not be •asy ui solution.

As the conflict proceed*. the bank says, it will be necessary to divert an increasing proportion of current income to the purposes of war. and rely to a smaller extent on the savings of previous periods. I'lm movement towards that objective is exemplified by the notable increases in taxation provided for in the Budget for the current vear. ami the larger amounts proposed to be raised by borrowing.

'I'd tlie extent that these (Trowing transfers from total production to army needs arc not compensated by increases in the aggregate production of the communily. tiierc must, inevitably, be a reduction in the tfoods available for civil eonsumption and use. Naturally, this will icact on business in general, through pike movements, deficiencies in supplies, or changes in varieties -mil qualities.

A gains* 1 licse drawbacks may be set the ability to draw further on the unused labour reserves in the community, and to lesson or defer expenditure on maintenance and renewals of fixed assets, as well :i i on i'uprovc-inriits ti» farming and other pi opi-rlios. As out war effort expands to

full dimensions it will become increasingly necessary for the Australian people to add to their industrial production and l educe their demands tor poods which can be done without. This will involve sacrifice, but not pi eat hardship.