CHEAPER BREAD

Evening Post, Volume CXVIII, Issue 92, 16 October 1934, Page 8

CHEAPER BREAD

(To the Editor.) Sir, —Irrespective of party polities, the views expressed by Mr. J. A. Round in Friday's "Evening Post" indicate an error in economic thinking that unfortunately seems somewhat de-eply rooted in certain sections of the community. Criticism mishandled and misapplied relative to cheaper bread and development of our pig and poultry industries is one of the most potent factors operating against bringing about improved economic and general trading conditions. As a champion for. tho Canterbury wheat growers Mr. Bound refers to "the cheap bread fallacy" and "tho ruination of one.of our basic primary industries" (wheat growing?) unless tho existing sliding \ scale of duties on wheat and flour is permitted to continue. As bread is a staple commodity of food the position under review requires little, if any, imagination to appreciate what a reduction in prices would mean to the breadwinners of this Dominion. The responsibilities of these same breadwinners are made more perplexing for the reason that a narrow and even selfish outlook (influenced by sectional interests) makes it almost impossible for many to grasp the true meaning of the necessity to gauge the reduced purchasing power of the people, and give a full measure of relief wherever possible. The protection being bestowed upon wheat growers is an unwarranted tax on the cost of living, and cannot bo continued indefinitely merely to serve the purpose of propping up fictitious land values to the detriment of tho people as a whole. If our legislators wore to perpetuate 'the standards that JNfcw Zealand stood for in the past then it would be possible to emerge from our economic chaos more easily than many imagine?.

To continue sheltering an uneconomic industry, such'as wheat growing, is not

conducive to the restoration of confidence and the much desired feeling of national stability that alone can thaw tho unprecedented amount of frozen capital held on fixed deposit by the bunks. Notwithstanding the refusal on the part of the Coalition to accept the recommendation of tho Tariff Commission to abolish the present sliding scale of duties on wheat and flour, the writer will quote a few extracts from the report of the Commission mentioned:— i ."After considering the information available, we are of the opinion that the .existing system cannot long continue to I)o,capable of administration on an ordinary commercial basis. We are satisfied that the system must break down unless authority is given to the Minister of Customs to determine the duty payable practically on each shipment. We could not take the responsibility of recommending such a course with respect to commodities like wheat and flour, and think that the existing system should be abandoned. It seems unlikely that New Zealand will ever again be in the position of a wheat-exporting country. Our view is that in accordance with our accepted national policy respecting the tariff, protection should . continue to be accorded to the wheat-growing industry. We therefore suggest duties at the rate of Is 3d ( per bushel on wheat and &a 15s per ton on flour.". The following addendum was a,dded by Professor Murphy, a member of the Tariff Commission:— "While I endorse the proposals of my colleagues as preferable to the existing sliding-scale regime, which, apart from other objections to which' it is subject, has become administratively impracticable,- I am of the opinion that import duties on wheat and flour should be abolished as soon as practicable, by progressive reduction over a period of years. The advantageof wheat duties to the grower is necessarily capitalised, resulting in a level of land values higher than would prevail in the absence of such duties." It may also be of interest to your readers to know that a committee was appointed by the Government in 1928----29 (chairman Sir William Hunt) to investigate the problem and solution of unemployment in New Zealand. The writer directs attention to the following extracts from the report by the committee mentioned:— "Pig and poultry production on a large scale means smaller farms; full utilisation pf dairy by-products; more work on farms; more people on tho land; jtnoro work for railways, freezing works, waterfronts, and ships; : more work for secondary industries—-in fact, more work and more prosperity for everyone.-" "Pig and poultry farming in conjunction with dairying. will mean a greater production per acre. It will mean more employment on a given area, and will bring about a further subdivision of land. The greater production per acre will ease the burden of local rates." Our difficulties in this Dominion today are due in the main to an insular mental outlook and stubbornness to face facts even when they are obvious. SooneV or later there must be a redistribution of the population of the Empiro under a gigantic land settlement scheme. This Dominion has already written-off millions of pounds on soldier settlement alone, yet the cry still goes forth that land is too high in price to procure for closer settlement. The more one clearly discerns the 'apparent hopelessness of restoring stability and national confidence under the present policy of artificial measures and inaction, the more one" 'jvonders what, if any, is the relationship between our artificial rate of exchange and tho privileges enjoyed by favoured wheat growers? To those who look for prosperity from such measures mentioned, they must: expect-.a gathering landslide of disheartenment and still further economic confusion and hardship for all concerned. —I am, etc., T. A. FEASEE.