SHORT OF MONEY

Evening Post, Volume CI, Issue 111, 11 May 1921, Page 4

SHORT OF MONEY

The Government's answer to all questions of expenditure is a non possumus. Recently the non possimus was based on the scarcity of men and material, now it.'is based on the scarcity of money. When the Minister of Finance says "I cannot," it is very difficult to go behind him, for no Government has yet had sufficient courage to brave financial criticism by simplifying the presentation of the public accounts, or by showing any inclination to part with information that can possibly be used against it. Seeing that this reticence and this plea of poverty are a habit of all Governments in. certain situations, the present position need occasion no surprise; but the existing Government .would/.certainly, be. wise if it'followed'up "the Aoting-Prime Minister's statement yesterday with a few (figures covering the financial year just dosed, and explanatory ofits impoverish•od condition. The man-in-the-street may be pardoned for wondering why a Government that, comparatively recently, was disposing of huge surpluses, should have so managed things as to be compelled early in 1921 to curtail public works on the plea of lack of money. It is not a complete answer to say that the surpluses have all been invested on capital account elsewhere, and that public works cannot be carried on out of Tevenue. The Public Works Fund has been fed partly out of capital (borrowed) and partly out of revenue, and those who directed capital expenditure in the last couple of years might be expected to explain why the present position was not foreseen and provided against, or why foresight was impossible. Public opinion, we think, requires more than a mere financial ipsa dixit'. It requires facts and explanations, Teduced from terms of "high finance" to a level of popular comprehension.

The policy of creating unemployed, so as, to save money which will constitute a fund from which to relieve the unemployed, if they become sufficiently clamant and sufficient of a. political danger, ie not without its drawbacks. Of course, if a Government is really short of money, it must husband what it has; at the same time, unemployment is an infectious sort of thing, and a, Government's example is very liable to be followed by private employership, and to undermine public confidence to such an extent that unemployment becomes cumulative. It may be true to Ba y—as the' Government says in part— that the best sort of expenditure in times of unemployment is on work in which (a) the proportion of labour-cost is much higher than the proportion of materialcost, and (b) the scope for unskilled labour is large. On the first count, some objection has been raised against housing. But has there not been a curtailment not only of prospective housing expenditure but of current loading expenditure, and roading does not appear to be loaded with the material costs emphasised by Mr. Anderson .in relation to housing ? Moreover, any such argument against housing appears to be applicable to schoolbuilding. In preferring schools to dwell-' ings, the Acting-Prime Minister appear* to hare this in his favour—that schoolbuilding is solely a Governmental re'spimBibility, and that the house-building field is open to private enterprise. The Act-ing-Prime Minister also asked what the local bodies are doing in the matter of housing, though it would1 seem that the financial non possumus of the local bodies is at least as valid as his own. A policy of immigration and housebuilding, subsequently curtailed in both branches, appears to j represent a very bad gness at economic evolution. Yet the country requires production {and therefore population) to tide it through lean years, and if the constructive side of housing and transport had received more attention two years ago there would be less difficulty now over immigration and public works. Too much of the Stats's money has been invested in war-inflated ]*t»d values.