The Bay of Plenty Times THURSDAY, JANUARY 11, 1945. IMPORT RESTRICTIONS AND INDUSTRIAL DEVELOPMENT

Bay of Plenty Times, Volume LXXIII, Issue 13654, 11 January 1945, Page 2

The Bay of Plenty Times THURSDAY, JANUARY 11, 1945. IMPORT RESTRICTIONS AND INDUSTRIAL DEVELOPMENT

The Hon. D. G. Sullivan, Minister of Supply, who is on an official four, has made it clear to the President' of the Board of Trade that it is the fixed policy of the New Zealand Government, to maintain its policv of import restrictions which was implemented on December 7. 1938. He gave the British Minister to understand that tin's was necessary to promote industrial development in New Zealand so that employment may be found for the returning servicemen and women. The reasons given for this departure from sound economic principles are very plausible but not convincing. Economic principles and laws are immutable, and any breach of those laws inevitably results in reactions and repercussions which cause considerable harm to the nation as a whole. Let us try and weigh up the pros and cons of this policy of import restrictions. That it is desirable that all the units in the nation should be be fully employed will be freely admitted by every one. bur such employment should come about in a natural way and not through compulsion. An industry that cannot stand on its own feet, but which must be propped up by artificial means is uneconomic and must be a burden on' the people, who must find the means of propping it up. The original conception of developing industrialism in a country was through tariff protection, and there are many industries in the country which have had such protection for half a century and are still in need of protection. In some instances subsidies have been paid to hold up industries and some industries in the-Dominion are to be favoured with import restrictions. Similar products to those produced by factories in New Zealand will not be allowed to be imported and so these local products will be sold to the people of New Zealand at much higher prices than similar goods imported from Britain, Canada and the United States.' It cannot be contended that this is fair. The principle involved is that many should be taxed for the benefit, of a few. The costs of protected industries are invariably high, in fact, that is the object of protection, and the -protected industries are able to pass on their costs to the people. But there is another and more important industry in the country, and that is the farming industry . The economic structure of the country is based on the farming industry, and anything that harms it is promptly felt by the whole nation. The farming industry has no protection, for the bulk of the products from the farm is exported and sold in open markets with products from other countries. Thus it will be seen that if the costs of farm production increase, those increased costs cannot be passed on, as can the rising costs of a protected industry, and if the products of the farm do not yield a profit an economic depression becomes inevitable. The last depression was due to the fall in prices in overseas markets, which led to the foolish policy of insulation and isolation. It must not be forgotten that in the beginning of the year 1939 the country was nearing the financial rocks. We make this statement on the authority of Mr Leslie Lefeaux, the former governor of the Reserve Bank, and that statement has never been officially refuted.