The Evening Star FRIDAY, JUNE 24, 1921. Is it Exploitation?

Evening Star, Issue 17696, 24 June 1921, Page 4

The Evening Star FRIDAY, JUNE 24, 1921.

Is it Exploitation?

Somt: astonishing statements are made in a leaflet being circulated

here, issued by the Australian Industries Pro tec-

tion League. If they are true they merit the closest study not only hy tbe New Zealand farmer, but by the general public, especially in view of Parliament tackling the revision of the Customs tariff in the coming session. Tho purport of tho pamphlet, which deals exclusively with agricultural implements, is to show that Protection, instead of raising prices, lowers them. It sounds paradoxical, but the figures adduced in proof, taken from the authorised price lists of the firms concerned, bear out the claim. Some years ago New Zealand manufacturers of farm implements were working under a protective tariff. With the idea of reducing prices of farmers’ tools of trade, tho New Zealand Legislature abolished the duties on agricultural machinery and implements. The Legislature expected, in its innocence, that prices would fall. But it was disappointed. What did happen was this: there, was a prompt and notable decline in local manufacture of these lines, but so far from the expected advantages to the farmer being realised prices rose, and are higher now in New Zealand than in Australia. Two large American concerns, both with Canadian factories, supply tho bulk of the farm machinery used in New Zealand, and the same two companies do a large business in Australia in similar appliances. Figures taken from these firms’ price lists of 1918-19, in force at tho same time, show that in such lines as ploughs, harrows, cultivators, and drills the prices charged, by these importing firms in duty-free New Zealand are practically without exception from a few shillings to a few pounds higher than those charged in Australia, though loaded in the latter case with a 25 per cent, ad valorem duty. In some lines tho discrepancy is extraordinary, and may roughly be summarised thus: that despite a handicap of a duty ranging from 20 per cent, to 20 per cent., tho price of the imported article in Australia is 20 per cent, to 30 per cent, cheaper—instead of dearer, ns one might naturally expect. And this discrepancy tends to grow. The explanation of all this is that in Australia the imported article faces strong, healthy competition from local manufacture. In ISO 6 Australian industry was given encouragement by means of a protective tariff. The immediate effect of a wider field being thus given to Australian manufacturers was that in eomo instances they were able to reduce their prices, while in none, so far ns can be ascertained, wore their prices raised. The farmer was not exploited, and local indnsty went ahead. Here, without protection, the exact contrary seems' to have happened. The difference between the cost of the same imported article in Australia and New Zealand suggests that the farmers of the Dominion are not receiving a square deal from the importers, while there can be no doubt that tho local industries concerned have languished. There is a traditional fear of the danger of protective duties cansing monopoly and exploitation by local manufacturers. The boot would appear to be on the other leg. Unless this is disproved, there is every reason for New Zealand to hasten to follow Australia’s example. Tho prevailing unemployment gives additional urgency to the matter.