Gold a Safe Standard?

Dominion, Volume 24, Issue 147, 18 March 1931, Page 11

Gold a Safe Standard?

' Sir,— AU nations are see-king _ relief from uneconomic troubles, and will get it when they search for wisdom which, the child of truth, is not quickened until it is recognised and adopted. One or these obvious truths in our Dominion is that produce exports are drastically reduced in value inversely in proportion to the demand for gold. This demand favours purchasing - power, but defeats itself when prices react on wages and production. 1 Meanwhile the worlds farmers are impoverished and many will become unemployed through uneconomic costs which include land’ and other unjustifiable taxes. .. j Governments, with Communist, and pseudo-Labour exceptions, are assisting by lowering charges in an attempt to minimise the effect of reduced sales returns ; but, in any case, economic stress will compel reductions in salaries, wages, emoluments, and doles in every country, and not only in New Zealand. Important causes of trouble are gobihoarding, tariff barriers, greed and thriftlessness, together with other incorrect ideas of nations and- their party politicians regarding methods of self-pre-servation. It is realised that gold is being unwisely withheld from circulation, and such knowledge is an indisputable proof that this metal is no longer a'safe standard with which to measure the indebtedness of man. It would be more safe to calculate on average prices of the indispensable necessities of lite over a period of from fifteen to thirty years. This is not a new idea, and it has been thought to be -.more theoretical than practical. Wisdom, food, nring, and clothing are the most important. Wisdom is included because without it the others are less useful. Wheat, representing food, is considered indispensable, so much so that the opinion may be classed as axiomatic and is probably recognisd as such by foremost economists ; yet this grain and • its products are barred from the, people of this country by wanton’ Customs duties and arbitrary awards. Britain is strengthened through her bankers giving credit at three and France at two per cent. Thus helps their manufacturers in competition with other nations; nevertheless, the assistance given is rendered relatively inert through workers tolerating erroneous teaching ■ from men claiming to be .Labour spokesmen. These Witless ones cause strikes, unemployment, and loss of trade. Weaker purchasing-power results, with less sales and lower prices for national products. These are followed by deflated wagesloss of work, and pestilent agitators. New Zealand bankers raised their lending rates, causing at once a reduction in the value of their securities and a loss in earning-power, demonstrated by the present selling value of their shares. They seemed to some extent justified in their action in usurping for their purposes what is rightly one of the functions of State. Governments should have been, but are not, working in line with econ- , omic law. They support Acts which uneconomically and compulsorily control trade, and have permitted, clamouring but unsound political parties to sway them from the path of wisdom. In this Dominion, as in Australia, arbitrary shackles are the cause of unemployment and trammel every commercial and farming operation in this and other countries. They have bred thriftless and reckless Importations of numberless and needless • luxuries to satisfy, delectable and other bodily appetites for change. Farmers are in a difficult position, injured by one regrettably inequitable law which compels those with. dairying or agricultural holdings in cities ■to pay rates in excess of the letting value ,of their land, and also from another which makes nurslings of wheat - growers. Farmers’ gross incomes are this year reduced by fifty per cent After paying overhead charges their net returns are nil and the majority are poorer than the lowest-paid of Government employees or the unemployed whose sustenance they • are rated to provide for. Many are asked whey they did not lay by for a rainy day. The principal reason was that true farmers, contented, with; their occupation, invested profits in improvements to their farms, and such improvements are not translatable into credit or gold. If there was also extravagance, the folly was general amongst all classes. There is something radically wrong.. It may be, and almost certainly is, chiefly the senseless greed of gold and its acceptance as a safe standard of credit. Statesmen comprehend, but political misleaders and many of the general public. cannot or will not understand the futility, of fighting against, economic Jaw which, rightly interpreted and used, benefits the people, but its abuse brings even powerful' governments low. Economic law is embodied in the two great commandments of the Almighty.—l am, etc., ’’COMMON SENSE.” ■

Palmerston North. N.B.—Since writing the above, I have Been your report of Mr. Forbes’s resolutions and your fine leader on "New Zealand Corn Laws.” •