BUYING & SELLING

Dominion, Volume 24, Issue 240, 7 July 1931, Page 15

BUYING & SELLING

Dominion’s Markets

TRADE WITH BRITAIN

Some Aspects of Tariffs

If New Zealand is to keep the British market for her produce she must be prepared to buy British goods in return, as Britain must buy from the market where she sells her manufactures. Tariffs within reason will assist Dominion industries, but beyond that point high prices reduce demand, and the high tariff amounts to a bounty to manufacturers provided’ at the cost of the country’s economic life. These remarks were made by Professor B. E. Murphy yesterday in the course of an address to the British (U.K.) Manufacturers’ Association of New Zealand.. Professor Murphy’s subject was “The Economic Necessity of Buying British Goods.” He was not suggesting the doing away with a tariff for

revenue purposes, he said, but was only opposed to its iuerefise. In difficult times quack remedies were dangerous, because people- were worried and were disposed to try anything offered as a. remedy. He agreed that buying New Zealand-made goods would reduce unemployment, but that would not justify the imposition of tariffs to bolster pp industries whicii could never stand alone. Unless they were self-support-ing they would increase unemployment

Tariff-supported industries were carried on the backs of farmers, clerical and professional workers and other unprotected sections. Tariffs did not create wealth, or all their problems would be solved. They raised costs in primary industry and diminished the national competing power abroad. Unemployment could not quickly be met -by a tariff, which might make jobs in workshops, but not for unskilled men displaced by tractors, oil fuel and handling and constructional apparatus. Massed Production. New Zealand could only compete with manufactured goods in the markets of the world by massed production, and her remoteness from those markets.. transport costs, heavy rates and taxes, dear labour, vexatious industrial restrictions, and small population, made it impossible for New Zealand to enter into massed production. There were only poor , deposits of fuel and metal in New Zealand, and millions had been spent on wild-cat hydro-electric schemes, based on rotten finance. . , .. , . .„ By building up excessively high tariff walls New Zealand would find; herself cut off from world economics and. world price-level, which was: partly responsible for the financial crisis in Australia. Now 1 Zealand was well situated for mass production of primary commodities, and it was to the primary industries the country would have to look iu tlie future, having* natural advantages which made it possible to compete in the world’s markets. With her primary products she could pay for the manufactured goods made by massed production- In fact, if

New Zealand was to keep her market she must buy from the manufacturers at Home, for it was essential that Britain should buy from the countries to which she sold her manufactures. If New Zealand did not import she would not be able to export, for if she became industrially independent of Britain, tlie Old Country would buy her raw products where she traded. ‘ and loan capital followed her trade. The primary industries were standing on their own footing—except wheat-farming, about which he would say nothing or it might be taken for a'political diatribe. Tarifffed manufactures were a liability. Any further, increase in tariffs would increase the cost of living apd would further damage the ouly market New Zealand, had. . Mr. D. Ashcroft Edwards, who presided, expressed the thanks of the members to Professor . Murphy for his address. ■ ■