PROOF AGAINST SLUMP

Evening Star, Issue 22893, 26 February 1938, Page 15

PROOF AGAINST SLUMP

THE PRIME MINISTER’S BOAST FIGHTING SPEECH AT LABOUR PICNIC [Special to the ' Star.’] • FEATHERSTON, February 26. In the congenial atmosphere of the Labour Party's picnic in the delightful locality of the local racecourse the Prime Minister, who is recovering quickly from his recent illness, gave a speech of the fighting type, serving as his preliminary to the coming election campaign. His important announcements regarding the national superannuation and health schemes and his frank references to taxation appear under other headings. # He contrasted conditions under the Labour Government with those prior to its advent. " Poverty,” he said, “ has given way in New Zealand to picnicking and, in certain quarters, to garden parties. A few years ago crowds gathered to demand more food and work. They were given charity, that is as hard as a stone. .This year’s greatest assemblages all over the Dominion have been for pleasure. Every form of holidaying has been a record. That is the difference between having a Labour Government in power and a National Government in a panic.” (Laughter.) Mr Savage suggested that one of the lessons of the depression was that to leave everything to private enterprise and hope for the best was proved false by the great economic disaster. Therefor© the prosperity of to-day must not be permitted to lull people into believing that social and economic reform was never necessary. Already Labour’s new ways were proving to be better methods'in redistributing the increased national wealth. v SLUMP NOT INEVITABLE. , Booms' and slumps 1 were not inevitable natural forces working out their inescapable destiny. The history of depression and recovery the world over had surely, h© suggested, taught that Governments must accept responsibility for deciding the main'direction of national economic development. Commenting oh talk of another depression and the suggestion that it could be made worse by his Government’s policy, Mr’Savage declared that even if there was a depression overseas, the Labour policy was being framed-to avert' its effects from being imposed on New Zealanders. t

“ We have,” he explained, “ always stated that it is possible to insulate New Zealand’s economy from the effects of any world depression, should such an occurrence again afflict thj world—arid I see no reason why it should. Then I can'assure you, there will be no , better test for the success or failure of our policy. We have our plans ready; they are both comprehensive and detailed, it is largely a money problem. The Government is determined to base our money system on production. The ‘ Depression Government ’ believed that a fall in overseas prices led naturally ,to a fail in the national income, which in its course must necessarily be followed by sacrifices all round and straightened conditions. The Labour Party still holds that the national income can be substantially maintained in bad times overseas. We would protect the standards of living by maintaining wage' rates, and* employment by protecting the farmers’ income. There must certainly be no cutting of Public Works on the score of economy, which was one of the cardinal errors of the past depression.” MONETARY POLICY. “ The clearest lesson of the depression,” said the Prime Minister, “is that the monetary , policy is the most important single factor influencing a country’s economic prosperity. Already we have made use of the public credit in restoring prosperity, and we will not hesitate to use. it still further whenever the necessity arises.” CONTRASTS. Making some rapid contrasts between conditions as they found them and the position to-day, the Prime Minister referred to the 57,000 unemployed, only 3,000 boys learning trades, and 50 per cent, of our 80,000 farmers bankrupt, while wage cuts were so deep that every class was affected; but the mockery' of that position was that the country’s productive capacity was on the increase all the time, and so were our sterling balances. He contended that the,former Government attacked the depression by methods which made the depression worse. Even private enterprise, the very citadel of the Conservative Government, was besieged and shattered. In sharp contrast.to what he called 11 that destructive nonsense,” the Prime Minister said Labour’s policy was constructive. It believed in improving the purchasing power of the people, for it was essential that New Zealanders should be buyers as well as sellers' So the standard of living had been not only restored, but improved to levels never previously attained. Quoting a variety of figures to support that last point, the Prime Minister asked how the wage earners had fared. In 1035 they got £67 millions, hut last year the wage total was £96 millions, a gain of 43 per cent., or £29 millions more than the workers got under the former Government, while wages to-day were higher than in the boom year of 1929. ' As for the argument that wages 'would have risen under any other Government.. the Prime Minister contended that " history showed how in prosperous times the wage earner had to fight for a share which was never willingly conceded. ' r The decrease in the unemployed proved the truth of Labour’s contention that higher wages and shorter hours would bring about greater employment. Was anything heard to-day from parents as to what they would do with their hoys? he asked, adding that over 16.000 children left school last year to take up definite occupations.

NOT WAGE EARNERS ONLY. It should not be inferred, however, continued the Prime Minister, that the wage earners alone secured prosperity under the Labour Government. In fact, it could not even be said that they got the lion’s share. Private incomes had increased by 36 per cent, in two years, a gain of £37,000,000. It was suggested by the Nationalist propagandists that the Government’s legislation was robbing prl-

vate enterprise of all its profits and shackling enterprise, but the Prime Minister declared that the facts shattered' these contentions gnd confounded these prophets rf disaster. Within 18 'months of Labour’s rule some 1,358 new companies were registered with a capital of over v l3 millions. The net profits of 150 representative companies whose results had been published showed ' an average increase of over 14 per cent.—this after .payment of taxation. Factories had increased by 652 in a year to a total of 17,00(1, and there had been a record inin the numbers of factory workers. Increased purchasing power for thl majority of people had had a marked effect on the shopping business. HELP FOR SMALL FARMER, By its reorganisation of the dairy farmer’s economic system the Government had given him security and stability. Two years ago. the average income of the small farmers with valuations under £3,000 was £2 weekly, but to-day, after paying rent, interest, and working expenses, it was £5 15s. THE PEOPLE TO CHOOSE. Finally, in reference to coming events the Prime Minister suggested that i was for the people to make their choice “On the one hand,” he declared “ they are confronted with a party which appears to have forgotten nothing and learnt nothing as the_ result of dts disastrous experience during the five depression years; and on the other hand, the Labour Government guarantees to carry out a policy diametrically the opposite. I will never agree to any policy that will bring back the cruel forms of social injustice which marked the depression years under Jhe formei Government.”