GIFTS TO ALLIES

Greymouth Evening Star, 13 February 1940, Page 10

GIFTS TO ALLIES

AVOIDING PROFITEERING. CANBERRA, January 27. The suggestion that Australia should make a gift to the Allies of from £7,000.000 to £10,000,000 worth of produce each year during the war found further support at the Institute of Political Science Summer School yesterday. -* The proposal was originally put forward by Mr. H. D. Black, economic adviser to the New South Wales Treasury. Mr. S. J. Butlin, lecturer in economics at the University of Sydney, said yesterday that Mr. Black’s scheme would mean effective participation by Australia in the war, free from any stigma of profiteering. “In practice,” he said, “it would mean choosing an amount to be given from the sort of goods we normally export and which Britain requires. The finance of such a scheme would be relatively simple. Within Australia it would require no more than raising of taxes or loans to pay for Government purchases, although the prices might not appeal to the Oliver Twists among our producers. “As far as Britain is concerned, straight gifts would call for no financial measures. The scheme might be combined with reduction of our oversea debt, which is one way in which it has been suggested Australia might profit by the war. But if the debt repaid were that held by individual bondholders there would be no advantage to Britain in the scheme.. The only difference would be that payment would be made for the supplies through bondholders instead of direct. But we might, perhaps, make gifts to set against our suspended Great War debt to the British Government.

“AN INSURANCE PREMIUM.” “This scheme,” said Mr. Butlin, “is about the only kind of insurance premium we can pay against the risk qf an abrupt decline in export markets after the war, or the certainty of a steady decline during the war. For we have to face the fact that under war conditions Australia is badly placed in competing for 'war orders since, for instance, a boat can cai;ry four cargoes from North America in the time required for one from Australia. This situation has already developed in the case of wheat. “Loss of markets to Australia means a gain of markets to nearer countries, the expansion, of production and building up of vested interests there. The long-term prospects of wheat may be especially gloomy, but our exports in general will have to face the same problem in more or less degree. Gifts may be sufficient to outweigh greater, transport difficulties as against nearer sources of j 1 supplies which have to be paid for.”

“SHALLOW AND IMPRACTICABLE” SYDNEY, January 29. The Acting Federal Treasurer, Mr. Spender, yesterday criticised as shallow and impracticable the suggestion of Mr. H. D. Black-that Australia should give Britain and France between £7,000,000 and £10,000,000 worth of free produce each year while the war lasts. “Britain has not requested any such gift, and" certainly does not desire it,” said Mr. Spender. “In effect, it means that the Australian people would be

asked to carry part of the British! public debt. “Britain is getting from us the supplies that she needs, and they.are being sent to her as shipping is ■ available. If we supplied goods without payment, we would-have so much less to spend on important parts of our war effort, such as the Empire air scheme, and tlie training and equipment of the A.I.F. “As Britain is already getting from us all thp produce that she has sought Mr. Black’s proposal would mean, in the last* analysis, a gift of money by Australia. No one has yet suggested that Britain is in need of money, to win the war. “The Commonwealth Government considered a suggestion similar •; to that of Mr. Black, but decided against it because we believe that we can .use more effectively the money available for our war effort.”