National Debt

Press, Volume CVII, Issue 31522, 9 November 1967, Page 14

National Debt

Sir, —You reproach the critics of the Government’s continual borrowing overseas with what would happen if it stopped, but critics of the Government’s policy have been telling them for years that you cannot borrow your way out of debt. The Government has taken no notice until now we are saddled with a national debt of $2400m, which takes s2]m to pay the interest every week which we cannot afford. Mr Muldoon’s latest loan in London for £lsm, of which 81 per cent had to be taken by the underwriters, clearly shows where our credit stands. Mr Muldoon’s “lack of intent” has us tied to the I.M.F. until the end of the 19605. At the Royal Commission in 1956 it was clearly established that banks do create money. Banks do not publish their balance sheets. It looks as if America has got most countries in the world well fed up through the World Bank and I.M.F.— Yours, etc., S. W. HICKMOTT. November 7, 1967.

Sir, —We learn with dismay that instead of bidding us tighten our belts against our present ills, the Government has quietly borrowed another huge sum (S3lm) from the I.M.F. Would you tell us (1) by how much our national debt has increased under the present Government, (2) by how much our annual overseas interest payments have increased, (3) how far a nation can go on borrowing before it is in a hopeless position? Knowing what happens to individuals once they are “in the hands of the moneylenders” many of us are bitterly resentful against our leaders for putting us in this position.—Yours, etc., “MARY VALE.” October 21, 1967. [The secretary of the Reserve Bank of New Zealand (Mr W. Martin) replies: “The answers to the questions are. —April 1, 1961-March 31, 1967: (1) Internal debt, $538 million; overseas debt, $233 million. (2) $7.8 million. (3) This is a matter of opinion, but New Zealand is not by any means in a hopeless position at present. Only a very lengthy explanation would be adequate to give an analysis of the reasons for the increases.”]