PART OF A POLICY

Evening Post, Volume CXVI, Issue 90, 13 October 1933, Page 6

PART OF A POLICY

In his first speech as Leader, of the Opposition Mr- Savage was fortunate 'in having a subject to which he has given much attention — the control of currency and credit. He handled it, from the Labour point of view, with considerable ■ skill. Being no novice in debate he was I able to direct the attack against the Government, and he even sought to turn Ministerial references to the Douglas Social Credit Plan to Labour's advantage, Without committing his party to anything more than a knowledge of this plan he implied that it has some resemblance to the Labour policy. "We under* stand it, and U we set out to condemn it, we would at least' have a reason for it"l —which was diplomatic, but not 8 direct answer to Mr, Bodkin's question "How many of the Labour members support it?" When again pressed for a direct! answer Mr, Savage referred to shallow crjticjsm, and proceeded to indicate the points of resemblance of Labpur and Douglas Social Credit policy, But he did not get go far as the points of difference, And this was the weakness of Mr^ Savage's speech in other ways. On general lines and general -' aims it was admirable. No one will quarrel wUh tho idea that the purchasing power of the people should be increased, that they should have the means to purchase everything that they pro» duce, and, in short, that everybody should be prosperous and happy, The differences arise when methods are discussed, and Mr, Savage did not discuss methods.

Before the; public can fee persuaded to swallow this policy whole, however, they must have evidence that is more conclusive than the assurance that "parts of it are excellent." This was, in- effect, Mr, Savage's verdict on the Douglas plan, and it is as far : as we can go on his own policy, And even the excellence of the parts cannot conceaHhe fact that other parts are, to gay the least, unsound. Apart from his vagueness on methods Mr. Savage's speech left , much.. to .be desired m its ; . examinsiion of; Gauges, "The-aggregate prices of goods: cind serviced in New Zealand/ he said, "cannot ; rise , higher than the purchasing power of the people of the;, Dominion*?',' thi? is true is far as it goes, hut it does not go far enough, It does hot include any statement of how the height of purchasing power is determined. For example, purchasing power for many years.'was augmented by borrowing overseas, Now that borrowing has largely ceased; and a considerable part of the present purchasing power is absorbed in paying for goods and services of past years. If a man with an income of & 100 a year spends £150 .by borrowing the extra & 50 he cannot equalise his purchasing power in future years by calling his £100 £150 and; asking his creditors to accept it as such, A further point that Mr. Savage. failed to elucidate was the effect of overseas prices on-the income of a country which exports 40 per cent, of its produce lion, If the price that overseas buyers are prepared to pay for this 40 per cent, declines how is the pur. chasing power to be maintained? Mr. Savage says that "the Labour Party is going to control the banking system of New Zealand." That would be a sufficient answer if the banking system of New Zealand were responsible for the fall of overseas prices; but if the banking system has not caused the fall and is merely dealing with the facts as it finds them how is the position to be improved? Certainly not by calling a pound thirty shillings.