Mr Forbes's Plain Speaking.

Press, Volume LXVI, Issue 19941, 30 May 1930, Page 14

Mr Forbes's Plain Speaking.

Tho long statement printed to-day, in which Mr Forbes promptly redeems his promise to review the Dominion's financial position, is an admirable piece of plain speaking. Ho dodges or softens none of the hard truths which it was his duty to declare. He wastes no words in political finesse. He announces with uncommon boldness a wise and severe financial policy. For this he- deserves the thanks of every section of the people, and, except from tho Labour Party, he will receive them. It 1b here, of course, that Mr Forbes has been most courageous. He has committed himself to a policy that can only offend Labour. He promises, not to spend, but to spend less; and he can spend less, refusing new commitments and cheeking the present flow of expenditure, only if he defies Labour's demands and its opposition and ia ready to dispense with its help, or, in other words, to reject its control. Whatever its political effects, Mr Forbes'a choice of action in the situation ho defines is the right one, .and the only right one. If we may accept his figures he is facing a deficit of about three million pounds: a million less in Customs revenue, a railway shortage of a million. and a quarter—-we defer comment on his references to this—-a fall in land and income tax revenue of about a quarter of a million, and half a million in automatic increases of expenditure on pensions, etc. To attempt to make this Up by increased taxation would be a disastrous mistake. Overtaxation is so clearly one of the causes Of the Country's depression that even a small in r crease, would be a heavy misfortune; The Prime Minister in effect admits this, though he will not tie his hand? with a pledge against any increase;,but he sets himself squarely to the alternative. While the Dominion "re "doubles its efforts to tap its; potential "wealth';'—efforts which high costs, including high taxation, severely handi. cap or qiuV frustrate—-the State must "'eliminate or curtail" all possible; expenditure; and the Government ia therefore reviewing the services it supplies. "We have got to determine "what' is essential and,what is not,'' the Prime Minister says, and says in those words exactly what '.Th»' Prsss has 6aid at least fifty : times in five years and five times a year for fifty years. The difficulties may be acknowledged. r In whatever direction the knife is applied, there will be protests, and .it will be interesting to see how firmly Mr Forbes disregards them, as they can and must be disregarded, when the decision to retrench is just and necessary. Again, the clamour for, new '. expenditure.. must be ignored, especially for that expenditure which offers only an immeasurable return in increasing the community's wealth and learning capacity. Unquestionably Mr JFprbes is right when he suggests that Dominion ha», " reached * point a 11,I 1, ■ - •■■" ■ ' -' * •-

"when great care must be exercised "in investing further loan moneys in "purposes from which the return is "so indirect." Of course the Prime Minister needs to land no other justification for his policy of severe economy than the fact that he has to meet a demand for throe million pounds, and dare not think of meeting it by budgeting for so much extra revenue, and can only think anxiously of getting a little of it out of the taxpayer. It is not his sole justification, though he needs no other; but ho is to be commended for urging it with so much force and good sense, and for warning the complainers and spendthrifts that theif cries will be wasted, but no money. What is to be looked for now from Mr Forbes is an exposition, of the same bold, sensible kind, of what he means by " redoubling our efforts to "tap the potential wealth of the Do- *' minion." If he knows what that really means, and will say it, and will act on what he says, he will do the country a second and still more valuable service.