THE REVIVAL OF INDUSTRY.

Press, Volume LXIX, Issue 20916, 25 July 1933, Page 11

THE REVIVAL OF INDUSTRY.

CALL TO THE COUNTRY. ! ! I | NATIONAL RECONSTRUCTION ! ASSOCIATION. The most representative gather- t ing of Christchurch business and : professional men held for some time decided at a meeting in the Canterbury Automobile Association's rooms last evening to give full ■ support to the National Reconstruc- ' tion Association, a branch of which I was recently formed in the city. : The Afayor, Mr D. G. Sullivan, M.P., presided over a large attendance, , B which expressed its approval of the I association's object "to co-ordinate < all practical efforts toward tbe re- I a construction of business and the ' i restoration of prosperity in New ] 1 Zealand.'" ( Following an address by Mr J. D. , , McMillan, through whose work the < association was formed in Auckland, < speakers emphasised the need for 1 f action to revive investment in in- * ! dustry, the opinion being expressed 1 r that the country could not afford to permit the economic drift to con- * tinue within the Dominion in the j hope that help would come from j ' overseas. ; 3 Mr Sullivan said Mr McMillan's plea c ; was to the patriotism of men of all t classes, for the movement was non- t political and non-party. The situation 1 i certainly called for the utmost endeav- j 7 our of everyone to effect some changes c for the better in the present state of j » affairs. If a movement could be ) brought about which would alleviate c s the present position, a great national j service would be done, and for that { ' reason if the position could be im- c proved by the co-operation of all, then t that co-operation should certainly be E ; given willingly. New Zealand was t [ now facing another problem in the r v quota proposals which were being I made in London. F i "Paralysing View." "If the quota principle is agreed to," a I Mr Sullivan said, "New Zealand will : be thrown back more than ever on its i own resources. I think it would be . a paralysing view to assume that we must necessarily follow in the wake of the Old World. If it is assumed ® i that we can do nothing to help our- * , selves and recover our prosperity, and f that as a nation we are entirely de- ® pendent upon what is happening over- * ; seas, then I am afraid that there will ° ; be a very bad outlook indeed for the c people of this country. e "There does not appear to be very v ■ much to give us hope overseas at the a 1 present time. The break-down of the 11 1 World Economic Conference and the a 1 development of the quota agitation are 11 things that leave little room for happy d developments. I think that, irrespec- c live of political opinions, we all feel P ! that it would be a tragic thing if a c young country such as this, with its r extraordinary natural resources, should y have to face a future of comparative li starvation for such a mass of its n people because it took up the attitude o that it could not help itself." The Mayor added that the association e had no policy at the moment. Mr p McMillan, an Auckland solicitor, who v deemed it his duty to assist the coun- b try, had put forward his views which fi were merely a basis of discussion. He e was guided by the highest motives in s' the hope of helping his country and he g deserved the thanks of the commun- ii ity for the time and thought he had p put into the question in an endeavour o to contribute his mite to the solution b of the problems facing the country. tl

Danger of Inaction. Mr McMillan said he was not concerned with advancing a theory. His endeavour was to secure the assistance of the best brains in the country in an attempt to find a way out of the present situation, of which inaction was one of the most deplorable features. Private enterprise had to face up to the task of absorbing the labour which the Government had thrown on the market owing to the cessation of State borrowing and of public works throughout the country. The executive ability of the country was lost in fear. Either the system had to be changed or the responsibility for reconstruction accepted by the people. Whatever happened, the choice had to be made. Legislative efforts had failed. An Empire conference and a world conference had failed. They had to be , prepared to face the future not with ! any glorious expectation but viewing ' the facts as they were. By pumping money out of ordinary industrial use, the world was breaking down its own price levels. If private enterprise were • to remain, then the persons who controlled it must have the courage and : ability to find a way to place money i back into industry as a whole. Otherwise, nothing was surer than that the ■ present system could not last. Blaming the Banks. I Eeveryone was a deflationist, and 1 not only the banks, which had no • power to push the world forward if • it marched in the mass in one direc- 1 tion. Everyone was holding back, and ] the banks could not be blamed as much as some persons thought. '' The people told the State to solve , the problem but "sat and looked on." The people said nothing could be done ! until "someone else did something else somewhere else." The decision to be . made was whether the business men were to do the job, or the Government; whether reconstruction was to ' be brought about by investment or ■ taxation and borrowing, by a "service corps" or the public service, by private enterprise, or by socialisation. He believed there were several million! pounds' worth of industrial work planned in New Zealand awaiting a chance to be started. The Associated Banks had expressed their sympathy with the objects of the National Reconstruction Association, stating that ' their effort had been for a long time to get money back into industry. By a "service corps" he meant lawyers, accountants, engineers, and bankersall those who acted in an advisorv capacity to industry. * < Three Courses Open. ' There were three courses open to j the country—a programme of Government works, as was undertaken in . Sweden, the releasing of new credit i as was done in the United States, or a system of limited guarantee. He 1 could see no case for a policy of public works, for New Zealand al- 1 ready owed about £280,000,000 and t could not afford to borrow as it had £ in the past. Nor could he see any £ hope in the release of new credit, for i the outcome of the United States' t efforts had not been satisfactory. t Under the limited guarantee scheme, . tor certain proper investments and ' well-investigated undertakings, a fund ' would be set up to guarantee to investors 5 per cent, for three years The purpose would be to stimulate the flow £ of finance to industry. The sum of £ £50,000. the amount of one week's un- £ employment pay, would serve as a c guarantee of £1.000.000 of investment, i That would mean £500.000 in wages, i or purchasing power, for 2500 men for J a year at £4 a week. No one could say exactly what reaction an impulse c would produce, but the building sub- v sidy provided an excellent example— t £500.000 worth of construction work c being announced within a fortnight. v Borden on Business. c The position to-day was that the t great business section of the country s was carrying all those who had been i driven out of work by the elimination of new mortgages, new industries, and government works. "One does not have to be a banker or a financial expert to see that we must endeavour to restore what we have broken,"' Mr * McMillan said. t The reinvestment of mortgage a finance was necessary, and the limited r applied in this a

direction. He had been told thai Christchurch was full of money virtually idle, and men all through the country had told him that money was waiting to be used, Mr W. J. Hunter, a member of the provisional Executive, said the mortgage relief legislation "froze" mortgages. Before it was passed money was continuously being received and lent again, to the advantage of labour and the assistance of trade and business. The Canterbury Mortgage Adjustment Commission had dealt with 1100 applications during the last few months, and this was only a small portion of the total number of applications throughout the country. Well-selected mortgages, however, had stood up to the position. Mortgage Stability. "The Legislature should never, except in an emergency, and we all agree this was an emergency, interfere with the stability of mortgages, with the personal covenant of the borrower to pay, and the effective charge upon the thing mortgaged," said Mr Hunter. This legislation was an emergency measure as were , the war regulations some of which, however, were still operative to-day, he continued. The question was whether the mortgage legislation was to be left in operation, or whether some way was to be found whereby the present situation could be cased. Private enterprise could do much, but it seemed as if the Government should help. The question of establishing mortgage banks would no doubt have to be considered whereby the Government would buy up mortgages and issue debentures to the public. Mr H. A. C. North, secretary of the provincial executive, said the association provided the means whereby a really large and profitable move could be made in this country to bring about an improvement with the aid of existing financial arrangements. The tendency for capital to seek safety tended to be a real danger. People were hoarding and economising, and in addition the unemployed and their dependants had little or no purchasing power. The association's proposal should encourage investment, freer spending by those able to spend, and' a reduction of unemployment. A return to confidence could be hastened by the plan suggested, and it might be possible to improve on the original proposals as Mr McMillan himself admitted. Mr J. L. Hay, also a member of the provisional executive, said two things were needed in New Zealand—courage and leadership. Nothing could be achieved' by the association until these two were forthcoming. Bishop Brodie's Appeal. Bishop Brodie said he wanted to exhort his fellow citizens to realise their duty on this occasion. There had been many crises in the history of New Zealand. The country rose to the occasion during the war, and i during the 1918 epidemic. To-day the i country was suffering from the great- j est crash in its history. The question was: What was to be done? They had j allowed four years to pass while they i marked' time thinking the crash would adjust itself. But the country had not righted itself and it would not do so of its own accord. The position could not be alleviated unless the people of the country answered the call. (Applause.) Unemployment was reaching such proportions that he felt, wrapped up as he was with the relief movement, that the country could not face another year like the previous four years. Mr H. G. Livingstone said the audience contained' probably the best representation of the city's business life which could be secured, including bankers, stock and station agents, professional men, and those prominently engaged in various commercial pursuits. If Mr McMillan succeeded in gaining the interest of the city's leading business men, many of whom were present, his work would have been of real value. The situation could not be allowed to rest where it was, for the position was becoming too acute for further delay. The country could not continue to see men thrust on to the unemployment register, and the call was to the business leaders to make a determined move to improve the present state of affairs. Without their help the drift would persist, which would be fatal for the country and its people. Challenge to Country. A voice: If private enterprise fails, what is wrong with socialisation? Mr McMillan: Nothing. The Mayor: I think, gentlemen, in lis answer, Mr McMillan has given fou a challenge. Mr Hunter moved that those present should agree to join the National Re:onstruction Association and do all in heir power to further its progress in Canterbury. Seconding the motion, Mr J. E. itrachan, headmaster of Rangiora High School, and formerly president of the Canterbury Progress League, said that f men by their ignorance had brought about the present state of affairs, then yy their wisdom they could remove he present condition. If by their selfshness they had got into their present roubles, then by their unselfishness, hey could get out of them. Mr Hunter's motion was passed, all >resent handing their names to the secretary. Mr McMillan said he had been im>ressed at all the meetings he had adIressed with the growth of the spirit ndicated in the remarks of Bishop Jrodie, Mr Strachan, and others. Pros>erity would not come out of selfishLess, and the greatest hope for a return o prosperity was contained in the disovery of a new viewpoint. The Mayor, in moving a vote of hanks to Mr McMillan, which was arried with applause, said that it was toped to call a Dominion conference in Wellington within a fortnight or three reeks.