INTERESTS OF FARMER AND MANUFACTURER

Dominion, Volume 31, Issue 98, 20 January 1938, Page 10

INTERESTS OF FARMER AND MANUFACTURER

Difficulties Spring From Common Source I HIGH COSTS THE CRUX “It has become the established right of Governments to point out in times of adversity that the bad times were due to things entirely beyond their control, but when prosperity returns to claim that they were largely if not entirely the. cause of the good times and assume credit accordingly. In accordance with this usual practice -of Governments, our Government is claiming to be largely responsible for the improved outlook for the Dominion at present. The truth is that the improvement is entirely due to the improvement in the prices of our export, commodities,” states Mr. W. W. Mulholland, Dominion president of the New Zealand Farmers’ Union. “It is important to stress this fact at the present time because there are under discussion some matters which may be very incorrectly dealt with. If this is not fully recognised,” continues Mr. Mulhilland, “the discussions in connection with the compensated price may have tended to give the impression—never for a moment intended —that it is possible to devise a policy that would make New Zealand independent of fluctuating prices for her exports. No action by anybody in New Zealand, including the Government, can make our export production purchase more of the world’s goods on the world’s markets than the world is willing to give at the particular time in exchange for what we have to sell. Determining Factor.

“It is the amount of overseas goods which our export goods bring back to us that determines our standard of living and our comfort. It is sometimes argued that this dependence on our export products for our standard of living is a weakness in our national economy, and constitutes a danger, which could be avoided by producing all our own requirements. It is true that if we could shut ourselves entirely off from all other countries we would be unaffected by changes in world markets. But at what cost? “At present the production of a handful of people—the farmers of the Dominion —assisted by the small additional number required to prepare for market, transport and market that production provides New Zealand with a standard of living which the Minister of Labour on his return from his world tour said was better than he had seen in any other country. Why? Because we sell what we are able to produce cheaply to buy what other people are able to produce cheaply and both we and they benefit and are enabled to enjoy more of this world’s goods than if we refused to trade with one another.

“Actually, no greater harm could be done to our local industries than to injure the farmers’ power to produce at prices which will be competitive on the world’s markets. The interests of farmers and manufacturers, viewed in their correct relation, are not antagonistic, and it is not true, as is sometimes asserted, that either the farmers or their organisation, the Farmers’ Union, are antagonistic to local industries. We recognise that whatever we can produce locally without interfering with our ability to produce for export adds to the goods available for local use and consequently tends farther to improve our standard of living. “But if certain things can be produced at an artificially high price only, that high price becomes an added cost to the export producers, reducing their power to compete in overseas markets and to the extent of the value of the trade lost makes less goods available in exchange to maintain our standard of living to the detriment not only of tjie farmers but reducing the opportunities for business available to manufactures as well. Peace Of Secondary Industries. “The British industrialists whose goodwill is so important to our exporting primary industries but is endangered by some of the proposals being canvassed for the assistance of our secondary industries, have never indicated that they viewed with any disfavour the development of our industries in a natural way. They probably recognise what is indeed the fact, that so long :(s they are not developed at the expense of our export industries they are not in the least harmful to them and will not interfere with our ability to take goods from them in return for what they accept from it. If, however, development of the secondary industries is to be at the expense of our ability to produce for export the British industrialist knows that his export trade must also suffer and naturally he takes a very different view. “One often hears the statement, ‘Sending money out of the country,’ used in connection with imports. Actually imports are sending money into the country—except when they are not paid for. In that case the terms quoted above may be fairly applied. The goods imported by various Governments in the process of squandering the proceeds of their many London loans, most of which have not been paid for even yet, truly represent money sent out of the country. Goods brought in in the ordinary way of commerce are the return for the goods which we 'send away and are not an impoverishment but an enrichment of the nation.

“It seems to me that the difficulties of the industrial people in New Zealand and the farmers spring from a common source, and it would be particularly unfortunate if either or both were to seek remedies that would penalise the other. I am sure that no good can come of any such attempt. High costs are the crux of the difficulties with both, and if they could get together on this fundamental issue much might be done.