ECONOMIC FUTURE

Evening Post, Volume CXL, Issue 59, 7 September 1945, Page 8

ECONOMIC FUTURE

NEED FOR PLANNING

THE PLACE OF PRIVATE OWNERSHIP

"The survival of private ownership in business depends largely on the willingness and capacity of private owners to co-operate among themselves and with the Government to work out. and make operative, national plans for expanding production and equitably distributing what is produced, in raising standards of living, and providing economic security," said Mr G Lawn, economist to the Reserve Bank, in an address to the Wellington Town Planning Institute today on the question of national economic planning. At the outset of his remarks Mr. Lawn said the opinions he expressed were his own, and not in any way official.

Mr. Lawn said that there were a few people here and there who declared that no national planning was necessary- They were impractical dreamers apparently living in a world of early J l9th century thought. They seemed to believe that it was possible and desirable to leave the involved processes of production and distribution of wealth to the haphazard and uncoordinated operations of so-called "free competition" and the so-called "laws' of supply and demand. "Behind the thinking of such people," continued the speaker, "there appears to be a pathetic assumption that traditional rights to private ownership of natural resources and capital equipment are sacred, a pathetic belief that if each person does what he likes witti 'his own property under the stimulus of self-interest and profit-making he will inevitably do those things that will bring about the maximum welfare for everybody. Associated with this is the belief that somehow or other the vast number and variety of plans made separately by individual owners will integrate themselves and produce an orderly and systematic unity. "Such thinking is inconsistent withmodern experience. It is based on an obsolete and discredited philosophy. It represents a vain attempt to turn back the clock of time. Society moves forward, not backward. The 19th century is far behind us. It is unrealistic to assume even a return to pre-war conditions. We need to plan in terms of new ideas of social well-being, new methods of production, new forms of social organisation, and a new framework of property rights. With the advance of scientific knowledge, technical skill, and inventive genius new vistas of abundant productive capacity open up before us. We need to base our plans on potential abundance of wealth and not on scarcity. We must have boldness of vision and confidence in the capacity of people to co-operate. If we are to make full use of the potentialities of abundant wealth production, high material standards of living, and greatly-increased leisure, the planning must be done by energetic, far-sighted men and women of _ courage and optimism who have faith in themselves and their people, not by timid, disillusioned cynical people, who say, 'It can't, be done. It is contrary to human nature. We have always had slumps, unemployment, and poverty, and we always will.' A LESSON FROM THE WAR. "The war has shown what can be achieved by bold and vigorous planning, efficient organisation, the mobilisation of resources, and the unity of people. We must carry this over to the tasks of peace. . . . When we consider the wonderful possibilities of me future, if people co-operate to make full use of expanding productive capacity, it is clear that there is scope for stating the objective in terms that will stir the imagination and rouse and sustain public interest. Peace must have her victories as well as war." Mr Lawn said that, from a national point of view, financial plans shoind bo adjusted to production plans. In other words, monetary arrangements should be made to facilitate the full use of productive resources, to make abundance possible. If the real resources were available to provide the goods and services that the plans called for they should not be obstructed by lack of money. This was possible today to a much greater extent than ever in the past. It was practicable today to expand credit and currency to meet the requirements of expanding productive capacity. This did not make wise monetary management less necessary. Wise plans for the abundant production and equitable distribution of real wealth might be facilitated or obstructed or even wrecked completely by unwise management of currency and credit. "A further general consideration is: Who is to do the planning?" he said. "This involves the question of ownership of resources. I am not going to attempt to discuss the question of Capitalism versus Socialism. All I would say is that we cannot avoid the implication of collective production. All production of wealth is social. No one can rightly say: 'I produced this land, these mineral resources, these forests, this factory, this capital equipment, therefore it is mine by natural right.' Everything that is produced for individual or general use is produced by the collective efforts of many people, each contributing his quota of productive effort. The natural corollary to collective production is collective ownership. "The supporters of private ownership of natural resources or productive enterprises are today on Jhe defensive. They have to prove, if they can, that private ownership results in a better use of resources, a more equitable distribution of wealth, greater economic progress, greater economic security, and more satisfactory social conditions than can be- achieved under a system of collective ownership. In the realm, of economic planning they have to prove, in practice, that the vast number of individual pl«ns of individual owners can be efficiently integrated and harmonised so as to prevent gluts and shortages, booms and slumps, overcapitalisation, waste, and periodic economic confusion. The trend today is in the direction of more public ownership of resources, more public direction of the production and distribution of wealth." A Customs import prohibition order dealing with the importation of wireless equipment has been revoked, ac» cording to a Gazette notice.