THE TWO INDUSTRIES

Evening Post, Volume CXVIII, Issue 24, 28 July 1934, Page 12

THE TWO INDUSTRIES

MR. POLSON'S REPLY TO THE; MANUFACTURERS

'(To the Editor.)

Sir,^-I am afraid/I cannot-emulate the; undignified■ language .; o£ t the manufacturers in their ' garbled misrepresentation of my speech on the tariff in Parliament last. week. Their'representative, of course, ignores the fact that I offered the manufacturers all the support they are,getting today but by another and direct alternative instead of the vexatious and costly, method of fiscal .taxation, and endeavours to represent me as the enemy;of the manufacturers.: . . ..■■■-.'..'■ ;..

Mr. Mander takes exception to my statement that ". .the secondary/ industries have fastened th,eir eyes on the small local market.' '■ '■ - What is" wrong with-the statement? \ They i::have had one increase of duty after another, and yet have never been able to secure more than two-thirds, of, the market." They have had: duties ranging from" 20 t0;25 per cent, on landed cost, Which is equivalent, to 22 to 271 per cent, .on invoice cost. They have' had in addition 3 per cent, primage plus D/ 40 on t total duty paid, and even then they could not cap-' ture the market. If they had-100 per cent, protection it would not help them. They are like a dog chasing his tail; as they raise the cost against the general public so also do they raise their own costs, of. production. You can raise prices so high that the buyer cannot pay the price. '■ •■ . .

The next Manderian objection to my speech is the following:—"Conditions do not demand from our manufacturing industries the same enfeieney as is essential with primary industry.'' Surely this is a self-evident fact. If the secondary industries were fully efficient they would not require a subsidy, yet Mr: Mander himself has stated that'a reduction of 5 per cent, will kill industries now protected to the 25 per cent, mark.

Mr. Mander then makes some, complaisant remarks aTjout the primary industries, but the fact remains that until the recent drop in overseas prices wo were able to carry tho "protected industries" on our back and at the same time increase our output 450 per cent, in dairying products and from 100 to 200 - per . cent, in other exports. The quality of our exports is in advance of any country that-has to resort to tho freezing process to market its goods. The high cost of land was and is due lo the high costof labour and materials, duo in turn to" the protective policy. Unimproved land never was high in price, and sinco 1927 has been given away by the Government. , Mr. Mander says that this "country versus town vendetta is confined to Mr. Poison and a few fanatics, in the north." It is1 a good thing for Mr Mander that the-gerieral public do not know what this "protection" is costing them. If they once grasp the position I think, Mr. Mander will require police protection. ' ' .

With regard to my statement respecting the eighty-one boot factories, I can only say that my figures wero taken from tho New Zealand fear Book, and I have no means of ascertaining the number employed in each factory. In any, case it is not a matter of much importance beyond tho fact that one well-equipped factory should bo sufficient to supply the needs of the Dominion. Tho year 1927 was selected because that was tho last year available without any complication of either increased tariff or exchange. Surely Mr. Marnier does not dispute the fact that the cost of the local article is computed at ''import parity." If there wore no: duty the local article would have to bo sold at a price reduced by the amount of the duty remoVed, consequently, whether it be "Polsonian" or not, the duty is the cause of the higher price of the,local article. "Bonus" may not be the ..correct word to use,: but the fact remains'that tho result of the protective policy is to raiso the cost of the commodity to the extent of £281 multiplied by 2376 (employees), equals £667,000 per annum. Mr. Mander says I have "overlooked the fact that the industry gives back something in exchange for the 'bonus.' " If I have I hasten to make amends. Tho bootmakers gave us boots .at London value worth £876,748, and we gave them in increased cost for boots £667,170; so that we not only paid tho entiro wage bill of £312,979, but also the greater part of the cost of the leather used in the manufacture of the boots.—l am, etc., ' W. J. POLSON;