NATIONAL DEBT

Dominion, Volume 36, Issue 309, 24 September 1943, Page 9

NATIONAL DEBT

Payment By Credit Issue Held Impossible

It was both physically and financially impossible to pay oft the national debt by tiie creation of credit, said Mr. Nash, at Lower Hutt, lat-'t night, when dealing with a manifesto on this subject. There was a big attendance in the King George Theatre. Interjections on money issues were noisy 7 and frequent, but many 01. the candidate's answers brought sustained applause. At the conclusion scenes ot enthusiasm greeted a motion of tnauks and confidence. . The only correct and honest way to pay off the debt was to return to the lender •I pound of like value to the pound borrowed, said Mr. Nash. The only honest £1 note was one which gave the holder a justifiable right to demand goods and services for it. “You can manage credit and currency to ensure that the maximum quantity of goods are brought into be--IUA voice: We have not got-the goods. Mr. Nash: Then there is no need to create more money. (Applause.) Mr. Nash said that one candidate was a member of the Douglas Credit movement, but he iiad come to the electorate as an Independent. There had been a great deal of loose talk about monetary control, said Mr. Nash. The .purchase by the Government of the Reserve Bank gave it complete control of the country's credit and currency. ' . An emphatic demal was given -by Mr. Nash when referring to an assertion that only £2.000,000 in direct subscriptions and £7,000.000 in national savings had been made-to the Third Liberty Loan, the rest of the money being provided by credits from the trading banks. The obvious reason was to suggest that such action would cause inflation. The facts were that £38,000,000 of the £39,000.000 had come from the people’s savings. The trading banks had subscribed £1,000,000. Mr. Nash 'made it clear that prior to the issue of the loan an agreement had been reached that the trading banks should not subscribe to the loan. The £1,000,000 was to meet certain subscriptions paid in advance. The rest of the money came as follows: Post Office Savings Bank, £-1,250,000; life-insurance companies. £2 725,000;- trustee 'savings banks, £1,548,000; Government departments, £2,020.000; other investors . in stock, £18,283,000: national war savings deposits, £7,315,000; national war savings bonds, £2,134,000. The trading banks had been anxious to subscribe to the loan, but had been advised not to buy Government stock till arrangements could be made.