THE. ECONOMIC SITUATION.

Press, Volume LVII, Issue 17103, 26 March 1921, Page 10

THE. ECONOMIC SITUATION.

TO THE EDITOR OF'"TIIE PRESS."

Sir, —Many of our economists, labour leaders, financial experts, and leaders of thought have been labouring under ideals born in fallacy, and a situation has rather suddenly arisen which is evidently quite beyond their powers of vision to see through. They can neither make a plain istatement of the cause, nor lay down a plain path that would ..assure us avoiding disaster. I will briefly state a few facts leading up to the position. When the war began our economists only thought in terms of men and money. They, one and all, would have' said, that it would have been quite impossible to finance the wa» for anything like the magnitude and length of time it attained, and lasted. But production and command of goods was the great economic question, and is yet. Before the war the cost of living was the burning question. Production of "goods was not equal to the demand for goods. It was in quest of command of a larger share of the goods of the world that Germany started the war. It was the want of goods, not money, that eventually stopped her, at least it was the largest factor. Now, after the war, the cost of living problem must bo more acute, because in many lines of goods the production was 'sadly, in arrcar. Many were under-produced through the un-der-production of others. In no line was "there over-production. Wool, for instance, was not over-produced, but a percentage was held up through underproduction in transport and manufacture: and the want of roods in woolconsuming countries to exchange, and the refusal of England to take cheap •roods in.exchange. The irony of the present abnormal situation is that the only producers that have managed to keep up anything like their normal output; i.e., the farmers, are the only ones, according to our experts, that are inert! with disaster, or-at any rate, with the first and largest shnre cf it. If this is getting back to "normal," Lord help us when wo nre normal. _ "Will "normal" he when the production of wool, meat, s&ihs, tallow, butter, cr.etse, hemp, etc., have fallen back in line with the shortage of manufacture, of transport of in exchange to a world poverty-stricken for the want of goods, and the want of employment in producing goods. If this is getting back to normal I would like to ask what state or date would they have us go back to, perhaps to the misery that followed the Napoleonic wars. I ask why go back at all. Our experts seem to think there is a nice state of thing called "normal" wmio distance in the rear. I would sny go forward to "normal." Catch up our arrears of work. This will not bo done through unemployment, shorter hours of manufacture, transport, or distribution, nor by more buying power to those sections behind with their work. Those on the land may be compelled to lire' without

income for a year, but it shoijd not l>e necessary far them to throw their savings or capital into the under-pro-ducing machine as well as their income. No good could come of such a sacrifice. It would he the starting point for a general collapse. A system of credit is at once necessary to assist those who are holding lines of which the production ha 9 been normal, but held up. Until the world risen to her normal feet, freed from price fixation, from combinations of capital, from combinations of labour, from combinations of tho members of the hundred and one callings that go to make up a community, when-every individual strikes out with tho self-reliance and strength and the enterprise of individualism, to find his own row, wind to hoe it to tho best of his ability, for his own good, and the good of his fellow*, then, and then only, will the world prices become normal,, by the unfettered law of supply end demand, the only sound law in 'economics, the only way by which we can obtain the true service of money as medium for the exchange of goods. « One man one vote, sensibly used, w»l assure the workers a fair portion, of a larger supplv of eood than unionism can hone to do. Because, if the farming cla'ss embrace all the main planks of uriionism, the reins of power would immediately fall into their hands, causing a deadlock, against any other union, and at least complete the chain of demand for a better living out of a lesser production. Money would lose its value and its equilibrium as a medium of exchange, and chaos would result. One more word: If it is overproduction, why economise? If it is iirider-production, why unemployment.-' -Yours, etc, STRACHA T;. Rakaia.