TO MAKE THE LOSS EVEN

Evening Post, Volume CXXVII, Issue 105, 6 May 1939, Page 8

TO MAKE THE LOSS EVEN

A strong case was submitted to the Prime Minister by the retailers' deputation which yesterday asked for modification of import restrictions or some other alleviation of the hardships likely to result. While there may be something to be said in mitigation of the consequences foreseen by the deputation, it was established, we think: (1) That the demands of the public cannot be fully and speedily met by local manufacture; (2) that the effect of this must be to reduce business and employment in the retail trades. The important public point proved is the second. It means that a disproportionate share of the cost of rehabilitating New Zealand will fall upon the traders and their employees. All of them will not be so badly hit as the importers, but they will suffer severely. Can this be avoided? Some degree of hardship, we think, i? inescapable, but it should be possible to distribute it equally, or at least with greater equality than is presented in the prospect of complete destruction of one man's business or occupation and no reduction in the income of another. Equal distribution of the sacrifice is the task of the Government. The Prime Minister's reply, inviting the deputation to propose a better system (with certain qualifications), suggested that those who point to the faults of the Government scheme are under an obligation to correct them. But this is not right. Neither the retailers nor any other threatened section have the means to ascertain or the power to operate an alternative system.

The Government must accept that responsibility, and we do not think it can discharge it if it declines to face all the facts. One of the facts is that, on the present cost basis, an effort such as is being made to attain self-sufficiency must be hampered at every turn. Moreover, it will be most expensive for the consuming public. The deputation mentioned an increase of "fully 50 per cent." in one line. What the Government j must consider is that, if the system is to be worked out this way, the workers (as consumers) will lose through the reduction in value of the wages they receive even if the amount remains the same. It will be wage-reduction by inflation and price increases. And it will be full of inequities. For one thing, it will press most hardly on those with fixed incomes (including pensioners). To avoid this the cost question must be tackled. It is no reply to this to say that cost-reduction means only wage- | reduction. As every employer knows, there are numerous restrictions and conditions which enter even more into the account, and these should certainly be reviewed in the light of the urgent demand for an expanded production.

It is not contended that costrevision can now solve the whole problem. It might have done so early last year, when the Government was urged to give this and its own expenditure immediate attention. Now the trouble has been aggravated. Measures applied to sterling and imports cannot be avoided, though we still hold that control through the banks would operate more smoothly and efficiently. But we do contend strongly that such measures should not stand alone, with one section making the greatest sacrifice. Only by cost-revision can the burden be more fairly and widely spread.