BANKERS NOT AT FAULT

Evening Post, Volume CXXI, Issue 83, 7 April 1936, Page 16

BANKERS NOT AT FAULT

MR. WRIGHT ISSUES WARNING

Mr. K. A. Wright (Independent, Wellington Suburbs) said that it had been claimed that the bankers were at fault for the lack of currency.' He held no brief for the banks or for the bankers, but it was reasonable to ask how the banks could possibly be responsible for not issuing sufficient cui--rency. The banks did not exist for the purpose of sending men out into the streets and giving money away. Their business was to lend money to those people who had a security. The banks would circulate all the money the people wanted so long as the security was there. Mr. Wright said he wanted to ask the Prime Minister how much paper money it was proposed to issue, and whether it was to be repayable in any way. A great deal depended on the answer to a question like that. He was prepared to admit that the Prime Minister was absolutely sincere, and that he believed in the scheme that was being propounded, but great men had been proved to be wrong in the past. New Zealand was embarking upon the greatest experiment that had ever been tried in New Zealand and, for that matter, in the British Empire. He knew no part of the Empire where such a scheme had been tried successfully, although a province in Canada was going in for something of the sort. Labour members: Quite different. AN UNCHARTED SEA. Mr. Wright said New Zealand was embarking upon an uncharted sea, with a captain at the helm who had never been over the road before, faced with the necessity of providing his own chart and his own compass. Yet the captain hoped to reach his destination. The Minister of Finance, continued Mr. Wright, had been very careful not to disclose details of his policy, and it was to be sincerely hoped that some limit was to be placed on the amount of money that was to be issued.

Taking the East Coast railway as an example, Mr. Wright said it was proposed to issue credit to the value of £1,500,000. If that money was to be repaid in the event of the railway showing a profit, that might be all right, but what was going to happen if the railway did not show a profit or it resulted in a. loss? "Whatever happens," said Mr. Wright, "I hope the Government will not run the ship under. Let us not carry too much sail and run under." The Prime Minister: We are just trying to get the ship off the rocks now. Mr. Wright expressed the hope that the greatest possible care would be exercised, and that there would be no wholesale policy of inflation.