The Press. Monday December 16, 1929. Commonwealth Finance.

Press, Volume LXV, Issue 19803, 16 December 1929, Page 14

The Press. Monday December 16, 1929. Commonwealth Finance.

Jt becomes steadily more evident that the Commonwealth Government's financial and banking proposals, embodied in the Bank Bill lately passed by the Federal Lower House, are anxiously regarded as the instruments of a purpose all the more threatening because largely undefined. The Government has fitted some powerful levers to the economic machine, and has declared, in more or less intelligible terms, what some of them are for and how it is going to use them. In what is clear

in all this there is enough to cause great misgivings. But what is clear is not all. Nobody has any assurance that the Government will stop within the limits of its declared intentions, bad enough as they are; and the tone and temper of various Ministerial speeches strongly suggest that it will not. Mr Theodore, the other day, threw a sop to Cerberus in the form of an amendment, transferring the right to prohibit gold exports from the Federal Treasurer to the GovernorGeneral, and he argued that there was no harm in a prohibition which could not become effective except on the recommendation of the Commonwealth Bank Board and over the GovqrnorGeneral's siguature. Now Mr Theodore may very well have smiled when he did this. He offered to let the Governor-General, instead .of himself, sign the decree announcing Australia's departure from the gold standard; and he transferred from his own possibly rash hands to the safe and steady ones of the Board the function of presenting the pen to his Excellency and motioning him to sign. "If members " and if the country do not trust me, "surely they will trust the Bank?" That waa the pith of Mr Theodore's argument; but it leaves wholly out of account the most important question of all: what the Government is going to do with the Bank. If Australian industry and commerce knew the answer, they could not be easy, but they might at least be easier; they do not know, and they have reason to be afraid. It is true that the Commonwealth Bank is controlled by a Board; but the Board is appointed by the Government. Let "us assume, as we may, that the Board as at present constituted could and would resist the Government's demand that it should carry out a particular credit policy; that would inconvenience a resolute Federal Treasurer only by compelling him to find an immediate legislative way round, or to await the occasion of reappointment. And having shown that he wishes to control the credit policy, Mr Theodore cannot complain if he is suspected of intending to use the instrument ready to his hand, the Commonwealth Bank, especially when he has. legislatively strengthened it. In his Budget speech he attacked the " present system of credit control," referring to the bank, discount, and exchange rates, the expansion and restriction of credit, and the selection of enterprises to which it is extended. His colleague, Mr Anstey, the Minister for Health, has embroidered the same theme. The private banks are too conservative; and the Commonwealth Bank must cease to be a " bankers' " bank" and become the " people's "bank." As the Bulletin of December 4th points out, the Bank is already owned by the people, to whose benefit every penny of profit passes; it is governed by the nominees of the people's Government; no other bank has financial interest in it or any say in its management. Mr Anstey, therefore, if he means anything at all when he talks of making it a "people's " bank," can only refer to such changes as would make it a " politicians' " bank "; and this is the very development after which Mr appears to be hankering and for which he has prepared the way.