HON. DOWNIE STEWART

Evening Star, Issue 21290, 20 December 1932, Page 6

HON. DOWNIE STEWART

WELCOME SOCIAL AT SAVOY MINISTER'S SURVEY OF WORLB AFFAIRS FAITH IK THE PEOPLE TO WIN THROUGH Representatives of the business community and of numerous public bodies sathofed at the Savoy last night to share in the welcome back to Dunedin acporded to the Hon. W. Downie Stewart under the auspices of the Dunedin Manufacturers’ Association, there being a large attendance. A warm welcome * was given to Mr Stewart, who gave a highly interesting address dealing largely with the Imperial Economic Conference at Ottawa. , , The president (Mr J. Hogg) ofthc Manufacturers’ Association presided, and among those present were the mayor (Mr R. S. Black), Sir James Allen, Sir Charles Statham, Sir John Roberts, Sir Alexander Roberts, the Hon. J. A. Hanan, Mr W. A. Flavell (president of the Employers Association), Mr John Loudon (chairman ot the harbour Board), Mr V. S. Jacobs (president of the Rotary Club), Mr PS Anderson (president of the Dunedin H.S.A.). and Mr .George Ernngton (president of the /. Otago Expansion League).

CHAIRMAN’S WELCOME. Mr Hogg said it gave him great pleasure, on behalf of the Dunedin manufacturers and other bodies represented there, to extend to their guest and fellow-citizen, the Hon, W. Dowme - Stewart, their warmest welcome on his return to Dunedin after the fulfilment of important missions abroad —missions covering the Imperial Economic Conference at Ottawa and financial duties of great importance in London, missions which they felt sure he had carried out with distinction to himself and with benefit to his country The gathering to-night had no political, aspect, and no matter • what, political clifFerences might exist between the Hon. Minister and any of those present, he felt certain they all joined wholeheartedly in paying their tribute to one who, despite great, physical disability, had most - faithfully devoted himself to important tasks of statesmanship which lifted-his-mission overseas above the realm of party, politics. • “You know the - statement that a prophet has no honour in his own country,” continued the chairman. ‘ In the case of Mr Stewart I believe this has no application, and that not only his fellow-citizens are proud of his record of service, but that his sincerity of purpose and devotion to parliamentary duties are recognised widely throughout the whole .of New Zealand, f l would venture so far as to say that ■when the exchange question was in the balande the business men of this dominion welcomed his return, for the value of -his Judgment " and decision on this big problem. “We realise, of course, that the Hon. Minister,, like all other men, is human, and in his decisions for the : bene fit«:of the- country F as. a., whole .will undoubtedly displease ourselves and others at some time. This should on no account prevent any of us from recognising his great services to the dominion. I need not remind you that Mr Stewart, as Minister of Finance, has handled some of the most difficult Budgets ever presented in the House, and as Minister of Customs_ he has been, responsible for two most important taiv iff revisions, and is on the eve of a third. That third revision will be of a difficult nature for the Minister, because of the divergent views to be considered., .. il The'Governor-General, Lord Bledisloe, speaking at a 'luncheon in Dunedin last week, pleaded for co-ordination between the farmer and the manufacturer. Might I say that wo as a fedoration of manufacturers heartily, endorse the Governor’s appeal, and that we have always stood for a consideration of the farmers’ interests. While advocating a tariff essential to protect our industries and our workers, we have always opposed a high tariff policy or a prohibitive tariff as likely to lead to and the creation of an artificial position.” As Mr Stewart was aware, they willingly agreed to the conceding of the 9/40 surtax at Ottawa in order to allow their farmers to derive some corresponding benefit. They did feel, however, that they had the right to oppose any drastic reductions in the tariff, . inch might jeopardise the life of their industries, with consequent loss to the dominion, and particularly for what might prove to be doubtful benefits of practical value to the primary producer. Moreover, the right of the ■ dominion to promote and preserve its own 1 industries had been recognised by leading British statesmen, while a lowering of tariff at the present time would undoubtedly seriously affect unemployment and the revenue of the Government through the avenues of Customs duties and income tax. The last report' of the Industries and Commerce Department showed a reduction of only 4,968 employees, equal to 5.80 per cent., in the secondary and semi-secondary industries over the previous year, illustrating the great value of all their industries in maintaining employment at a time when primary producers were unable to absorb extra labour. From past experience and from more recent statements by the Hon. Minister of Customs, manufacturers could, he felt assured, rely upon Mr Stewart to deal fairly and equitably with the tariff revision, having regard to the welfare of all -actions of the -community and taking into '-mnt the extra preference New Zealand hud in the past accorded to Great Britain in comparison with Canada and Australia. Recently they had had proof that Mr Stewart was determined not to hesitate in the matter of serving the interests of producers in this country. His drastic action against Australia following the Australian boycott of New Zealand: produce showed that he had no intention of allowing the Commonwealth to dominate trade relations between ■ the two countries. (Applause.

EVENTS LEADING UP TO OTTAWA. After stating that he was glad to find himself back in Dunedin among old friends and familiar faces, Mr Stewart said.that for many years he had ' been.; in .close contact with the manufacturers through tariff problems. He regretted not being able to visit Dunedin more frequently. Difficulties had arisen, and, though it was quite well known that people were apt to complain that he was unable to come here more frequently, it had to be stated that a Minister had to do what he thought was his duty and risk the consequences. It was difficult to say anything fresh about Ottawa, con- *

tinued the Minister. The subject was rather threadbare, and, though the factors that led up to it were of vital importance, the work of the conference was receding into the background and was being replaced by a rapidly moving drama of world events. In any case, their own able representative, Mr George Reid, had already reported to them fully on that vital gathering. He had been for many years in close contact with the manufacturers through tariff problems. He did not think there had been any grave divergence between them and 'himself as to the main principles on which their industrial policy should be maintained and developed. They had always recognised that that policy must be related to the stage of development the_ dominion had reached in other directions, and that to try to proceed too fast would produce reaction. They knew, also, that they must carry with them in the main the goodwill and support of the community, and that with so small a home market the range of industries that could he economically established in New Zealand was limited. • ... The broad outline of the position, both from a world and from an Empire standpoint that led up to Ottawa, was well-known to them. One of the most striking features of the last century and the beginning of this century was the enormous growth of international trade. Markets were eagerly sought all over the world to absorb the rapidly rising output of factory production ot industrial countries. This in turn called for an ever increasing supply ot raw materials and foodstuffs from countries not yet industrialised. The standard of living rose rapidly,„ and population increased at an astonishing rate. It seemed as if mankind was about to reach the golden ago of material the Great War, and the great depression in 1929—tuese worldshaking events completely disorganised and demoralised the great growth ot trade. The decline was astounding. So marked was the sudden change that men began to ask whether the long and brilliant phase of development or world trade had reached its limit, because both before and after the war knowledge of industrial methods and scientific production both in primary and secondary industries had spread so rapidly that the phase of economic nationalism or local self-sufficiency replaced the previous phase of constantly increasing world trade. There was a levelling up all round in every nation in the main phases of its economic me. This was called commercial equalisation. The war greatly stimulated this .process. Supplies were shut off and had to he made locally. ’ Moreover, the difficulties of war and post-war finance led to constantly growing tariffs tor re.venue and tariffs, quotas, and restnctions sprang up in all directions. Economic independence became an obsesSl °Mr Stewart said that all the hectic development he had referred to took place without any common plan or cooperation. Production was rushed torward not merely for'the Home market, but also for export. The inevitable result of this was in many lines an expansion far beyond the ability of the world to consume, leading to tailing prices, lower purchasing power, and a general demoralisation of trade, that was broadly the world situation, and its bearing on the Empire was that Britain, whose overseas trade was her life blow), became converted to the need of tariffs as a means of bargaining and as a source of revenue. Britain saw the advantage of preferential arrangements with the dominions to replace her loss of trad© elsewhere. Some dominions had gone through the high tariff phase and Had begun to question whether tnej had not gone too far—Australia had definitely begun to reduce her tariffs. Further, the common economic interest of Britain and the dominions was increased by the departure from the gold standard and by the fact that, except for South Africa, they all had depreciated currencies.

PROBLEMS AT OTTAWA, The problem at Ottawa was to reconcile the common interests or the whole /Empire without injury to thenown local interests, said Mr Stewart. Therefore the great issues betore Ottawa wore how far the tariff policy of each country could be modified to help the others, and how far the monetary policy could be altered to see that any preference granted was not robbed of its effect by unstable Empire currencies. All that he had said seemed a long approach to New Zealand’s interests, and more particularly to the New Zealand manufacturers’ interest, in Ottawa. He welcomed the opportunity ot thanking the manufacturers of New Zealand for- the broad-minded attitude they had taken up in connection with their responsibilities at the Ottawa Conference. They realised that behind their immediate problems was the wider problem of the farmers—of the agricultural and pastoral interests of New Zealand. They recognised the overwhelming importance of the farming interests as affecting the prosperity or adversity in New Zealand. Every boom or every slump in New Zealand was the direct outcome of hieh or low export prices for farmers. Such periods had been an exact reflection of the success or lack of success of our great exporting industries. LIGHT CLAIMS BY NEW ZEALAND MANUFACTURERS. Mr Stewart said that the conferences held prior to the Ottawa Conference the New Zealand manufacturers made it quite clear that they were prepared to make such contributions, even at the sacrifice of their own industries, to restore the farming industry to prosperity by providing better markets and better prices. There had been a general belief that there would be considerable tariff sacrifices required to secure concessions to the export and . farming industries. It had been his own view that it would not be reasonable to expect New Zealand to make any very great concessions from the tariff point of view because of the fact that our existing preferences were far in excess of anything ever granted by any of the other dominions. In the result he thought he was correct in saying that the claims made on the manufacturers of New Zealand were comparatively light. The actual were confined to some half a dozen items. In the result the concessions had proved to be much less arduous and much less heavy than many people anticipated. Almost from the first day at Ottawa he was confirmed in his view that New Zealand would not be called upon to make any very heavy sacrifices. The past policy of New Zealand in granting only reasonable protection and closely examining the claims of each industry meant that there was far less scope for reduction than in high tariff dominions. As regards the proposed revisiop of tariff, there was no cause for apprehension from the Ottawa Agreement, as the policy laid down there had been the policy pursued by New Zealand for manv years past. If any marked reduction took place it would be for other reasons. There was a widespread demand for a revision of tariff to get down farmers’ costs. REAL VALUE OF OTTAWA. He regarded the Ottawa agreements as an experiment towards closer economic unity in the Empire, and he did not share the extravagant views of some that some miracle was going to

happen at Ottawa nor the extravagant fears of others that all the bargaining and haggling meant the break-up of the Empire. As the poet said, “ If hopes be dupes, fears may be liars.” If the hopes of some might not be realised, so the fears of others would be falsifled. The real value of Ottawa was the recognition by each part of the Empire of the aims and ideals of other parts. It was clearly recognised that agricultural and pastoral countries had the right to develop industrially as part of their national life and that Great Britain was entitled to protect her farmers to the extent she thought fit. “I confess I did not know that the United Kingdom is still the greatest agricultural community in the Empire £275,000,000 in Canada or Australia, continued the Minister. “ Another valuable feature from the manufacturers’ point of view was the co-operation and distribution of different parts of an industry between different parts of the Empire—e.g., m the iron and steel industry the conflicting interests of England and Canada were fully adjusted by representatives of the' industry before the conference met. Each concentrated on that part of production or manufacture most suited to their own local conditions. The same principle may be applied to many industries. Conferences will be required and agreements made as _ to what part of the process each dominion will undertake. Co-operation rather than rivalry is, the objective. He had found that the work at Ottawa had to be done at high speed, for it had ben realised that results had to be achieved quickly and that the work would have to be crowded into a month. He had been afraid that there might be a lack of flexibility _ in the agreements, but the general opinion at Ottawa had been ■ that> it was desirable to make them over a fixed period, because in the matter of duties it was considered unreasonable to start an industry unless the manufacturer know that he had some security for say, five or ten years, so that he could reap a reward for his efforts. POSITION OF FARMERS. After a reference to some of the personalities and incidents of the Ottawa Conference, Mr Stewart said he wished to say a few words about the position in New Zealand. Everyone knew the distressing plight of the farmers and the difficult, problem of how to save them while world prices remained at their present disastrous level or continued to fall. _ “ The changes taking place are so profound that we do not yet know whether it is possible to re-establish the way of life we have for so long been accustomed to or whether a new order of society will have to be painfully evolved out of the present chaos, said Mr Stewart. “ But what is important is that we shall try to keep a steady view and not indulge in recrimination and mutual bickering. For example, I often hear it said that the farmers are suffering for their sins of extravagance and high living in past times of prosperity. I do not share this view, for whatever their faults and shortcomings may he, they never deserved

the disasters and misfortunes that now so tragically beset them. “ No thrift and no economy could have provided an adequate safeguard against the present onslaught—in any case it seems to me to savour of hypocrisy to single out the farmer for criticism when we all more or less followed the same line of conduct. ‘ thinking long summer days would never cease,’ as the poet says.” • In conclusion, Mr Stewart said ho had an abiding faith that the people of New Zealand would rise to tlio occasion, and by their courage and endurance enable them to win through. He appealed to the manufacturers with confidence to hear their share. (Applause.) FURTHER TRIBUTES. The Mayor (Mr R. S. Black), in welcoming Mr Stewart home, said that many wonderful men had been born and bred in Dunedin, and their guest took an illustrious place among them. He was sure that Mr Stewart had come back to New Zealand with the knowledge that he had not visited a better country than his own land. After mentioning the great potentialities in the ■dominion, His Worship, amid applause, extended on behalf of the city a warm welcome to Mr Stewart.

Sir James Allen added his voice to the welcome as an old colleague and an old friend. He said that Mr Stewart’s recent experiences would be of enormous benefit to him in the work that lay ahead of him, and his contact with the statesmen of other parts of the Empire would also be of the greatest assistance to him. The speaker made an appeal for the sinking of all political differences in the effort to rescue the dominion from the difficulties confronting it. He stated that those at the head of affairs at the present time had a more difficult task than ever he had had as Minister of Defence during the war. He at least had had the country behind him four-square. It was their duty to stand behind the Government now. It was to be hoped that in its difficult task it would be led to the right conclusions. (Applause.) The Hon. J. A. Hanan said he bad known Mr Stewart personally for many years and realised his statesmanlike qualities. The members of the Government to-day were not to be envied. At no time in the history of the dominion had they been faced with a task that bristled with so many difficulties. The speaker supported Sir James Allen’s appeal for the sinking of political differences, and stressed the need for building up a united front by every section of the community. (Applause.) . Mr J. Loudon (chairman of the Otago Harbour Board) said that Mr Stewart had left New Zealand with the confidence of the whole country, ihe board joined with other local bodies in giving him a warm welcome home. They were pleased to see him looking so well, and they wished him good health and success in the future. (Applause.) A vote of thanks to Mr Stewart for bis address was proposed by Mr J. Sutherland Ross, who said that manufacturers regarded the tariff question in a serious light, and he w r as glad to

be able to assure their guest that in this respect they were unanimous in their desire merely for economic equality with their overseas competitors. Referring to the need for a tariff board. Mr Ross said he hoped that the board would soon bo an accomplished fact. He was in favour of a departmental tribunal in preference to one constituted around sectional interests and representations, and he thought that manufacturers generally would hold the same views. (Applause.) IN REPLY. Mr Stewart, in feply to the various speakers, said he would like to refer to the question of local body loans on the London market. When he first arrived in London the market had been closed owing to the British conversion operations, but while he was there it began to open again. He had been informed by a London financial adviser that the question arose of the accommodation of local bodies whose loans were falling due. Borrowers whose loans were due had to be looked after before those whose date of redemption was less imminent. Then there was a technical aspect of the matter. A loan needed by a local body did not need to be earmarked for a special purpose. It had been stressed that it was sufficient to name a Dunedin or a Wellington loan at a certain rate of interest for a definite period. The purely local purposes for which the loan would be used did not concern the investors in the least, and financial interests at Home would far rather no mention was made of such details. He had asked the head of the Treasury to take up the matter with the Local Bodies’ Association, and he thought something would be done in the matter. It would probably require some legislation, but that could be arranged. In reply to Mr Ross’s reference to the Eastern menace, Mr Stewart said, that the matter had been brought xip repeatedly, particularly in connection with manufactures that were competing with New Zealand goods. There was no doubt that there was a tremendous influx of such goods from Japan. He had thought the matter would have _ been brought up by some of the dominions at Ottawa, but probably they had not yet felt the full effect of the competition. There was no doubt that what Mr Ross had said was perfectly true. The expansion of those industries was phenomenal, and the statistics were extraordinary. One would think that some stops would have to be taken to meet the situation in the interests of Empire trade. He thanked those present for their hearing, and thanked the various speakers for their kindly references to ■ himself. (Applause.)