The Press. Saturday, November 6, 1920. Wages and Prices.

Press, Volume LVI, Issue 16985, 6 November 1920, Page 8

The Press. Saturday, November 6, 1920. Wages and Prices.

From statements made in the House by the Prime Minister it would appear that before the session comes to an end legislation may l>o introduced to deal with tho Arbitration Court's policy of ordering periodical additions to wages to bnlatico tho rise in the. cost of living as calculated by tho Government Statistician. Mr Massey questioned the correctness >of tho Statistician's conclusions in his latest statement, holding that there has of late been a marked check in tho upward movement of prices, rather than such a marked increase as warrants the addition of 9s a week to tho pay of every worker whose wages by tho Arbitration Court. That prices have risen very much during the past eighteen months is an unquestionable fact, but wo doubt whether the, rise has been so great as tho riso in wages. But oven if the advance in wages lias' no more than kept pace with tho advance in prices, tho policy of ordering these periodical bonuses to workers is a. very unwiso one. It works mischief in two ways. In tho first placo higher wage 3 ilo lead to higher prices, whatever tho Arbitration Court may bo pleased to think. In the second place—and this is oven moro important—tho ■ caro of the Court to maintain unimpaired tho pre-war spending power of those whom tho Court affects lias resulted in tho maintenance of that xinabated demand which kcops tin prices, and which has resulted in tho very disturbing increase in tho imports. The exports for tho first nine months of the calendar year 1S)19 .were valued at 40 millions; for tho first nino montlis of this year they had fallen to 3-5 millions. the imports, which were 22 millions for tho same period last year, amounted for the nino months ended "September 30th last to tho astounding total of 43 millions. A balance of 18 millions in favour of exports has been changed into a balaneo of 8 millions against, exports—a turnover in tho trado balance of no loss a sum than 26 millions sterling. These are figures which cannot but cause anxiety to thoughtful people. Tho truth of tho matter is that tho people of tlie Dominion have insisted upon the pre-war standard of ease, and it js possible that the unnatural expedients now necessary to maintain this unwise and improvident social policy will, - before long, result in very serious trouble indeed. We can think of not one act of policy, since tho war began, which had tho object, and achieved the end, of pnforcing prudence and economy on the nation as a whole. On tho other hand, wo have a whole mas? of legislative encouragement to go wrong. The responsibility does not rest upon the present Government; the damage was done by the Coalition. What the Government may have in mind—and that it has something in mind Mr Massey indicated pretty plainly yesterday—wo do not know. If tho Arbitration Court's policy cannot bo fundamentally altered, there is, nevertheless, one particular in which the bonus system may and should be altered. The Court, in ordering tho bonuses, divides ,ihe workers into three classes: adult male workers,' femalo workers over 20 years of age, and all other workers. A result of this is that the young unmarried man of 22 receives the snrae bonus as is deemed necessary to meet the increased expenses of a man of, say, 45 years, with a wife and four or five children to support. This is monstrously wrong. In the case of many workers tho bonus is not over-large/and is money not in-

judiciously laid out—we ars thinking of those cases in which tho wage-earner and his family do not become mere spenders. But in nearly every cane the

largo additions to the wage?* of unmarried workers arc money as injudiciously disposed of as can bo imagined. In the aggregate it amounts to an enormous sum, which hps gone towards wasteful expenditure ami the maintenance of that abnormal and unu.itural demand which at bittom is responsible for the extravagance of pric;? levels :'nd import totals. The country must shorten sail. Consumption must at all costs be reduced, and demand !:ept within bounds. Wo are not hopeful that legislation can d(J very much in this direction. Effective legislation would be stronger meat than any political party would care to tackle. Hut something can bo done, and the Government should have the support of every patriotic <:iii.soa in any earnest' attempt it may mrike to apply the brake.