The Press Wednesday, December 15, 1920. Wages and the Economic Situation.

Press, Volume LVI, Issue 17018, 15 December 1920, Page 6

The Press Wednesday, December 15, 1920. Wages and the Economic Situation.

The Pres3 Association's summary of Mr Justice Stringer's decision respecting the cost-of-living bonus ignored certain passages in his Honour's judgment which aTe both interesting and important. "We print these in another column. Prior to the passing of the 'Act of 1918, as his Honour remarks, the Court declined to increaso wages to the full extent necessary to meet the increased cost of living so far as it was caused by the war, on the ground that tho increased cost of living was a burden that should bo borno by tho whole community, "and that to relieve one class of "its proper proportion of that burden "meant to increase to that extent the "burden already being borne by the "other classes of the community." This was a sound and just policy, and it is as sound and just now as it was in 1918. Nobody, surely, will contend that the ending of active military operations required that one class of the "community should bo restored to pre-war conditions of comfort at the expense of other olnsses. It was not on that indefensible | ground that Parliament passed, the Act which dirocted the Court to grant the cost-of-living bonuses. Parliament' simply took the easiest way of stilling a most unjustifiable clamour; and we are pretty certain that an overwhelming majority of members of the Legislature now realise that they acted very unwisely. Indeed, Parliament practically admitted this last session. Mr Justice Stringer thinks that tho bad results of the 1918 Act might have been avoided or mitigated if tho Board of Trade had been empowered to command that in an?- particular case no rise in prices should follow a rise in wages. It is possible that if tins dangerous policy had been adopted tho public would Tiave been forced to faco tho facts of" tho industrial and economic situation long before now, but it is, on the whole,. matter for thankfulness that this extension of State interference with economic conditions was not seriously attempted. As wo have pointed out many times during the past three or four years the present difficulty over wages in relation to the cost of living is only ono phase of a trouble from which this country has been suffering ever since 1915. That trouble is the idea that there should be no diminution of tho comfort of the individual or of tlio community. Almost alone amongst the countries of the world New Zealand obtained easier cconomie conditions from the circumstances of the war. Other peoples had lo pinch and scrape from the beginning in 1914: we in this country flourished •amazingly. This immunity from the natural penalties exacted by an exhausting war is at an end, and as Mr Justice Stringer points out, we cannot expect to cscape the depression wKich in other countries has already had for one of its results a reduction in wages. The "Dominion is still much better off than many other countries, but it is the height of folly to imagine, as some of tho loaders of organised labour seem to imagine, that wages can be raised without any trouble. The demand that wages shall follow the level of prices as calculated by the Statistics Office is nothing less than a contention that this country must continue to flourish in despite of industrial depression and financial stringency. Wages and prices and everything else must come into harmony with tho actual economic conditions; to seek forcibly to maintain unnatural and wholly artificial levels will strain the whala pconomio fabric of the coun-

try. There- is the less excuse for the demand for ever-increasing wages in that the actual cost-of-living is not what tho Statistician's index would make it appear to be. For, as everyone knows, as wo havo often pointed out, as Mr i Justice Stringer points out, and as some • of the statisticians have ratKer belatedly i noted, people modify their budgets as | prices rise. If they are wise, the unionI isU will recognise all these facts and jwill resist any attempt that mav be | made by their leaders to engage in a i conflict over the pending cessation °f i wage increases.