Letters To Editor Exchange Rate And Inflation

Greymouth Evening Star, 22 August 1949, Page 2

Letters To Editor Exchange Rate And Inflation

Sir _Your leading article in your issue'of August 15 seeks to convince vour readers that Mr Nash printed an additional £20,000,000 in money during the last financial year. Your final paragraph further suggests that tms sum could, and will be used for normal Government expenditure. It is obvious, as you undoubtedly know if you have given any thought to the mattei, that the £20,000,000 was stock given by the Government to the Reserve Bank, as security for the liability of the State to the bank, incurred as a result of the adjustment of the exchange rate in 1948 No additional money has or will find its way into circulation as a result. The stock issued will probably be redeemed out of taxation over a neriod of years whereas otherwise the Government would have been called unon to find £20,000,000 for payment of this liability during 1948 when no budgetary provision had been made foi such expenditure. While holding no brief for any political party in this issue, misrepresentation of facts ■ loi propaganda purposes, an all too common feature of modern society, cannot be justified and should not go unchallenged—Yours etc., Greymouth, August 16. The subject of the above letter is fully dealt with in the editorial which we publish today. It is necessary to point out here, however, that our correspondent accuses us of statements we certainly did not make, and has put unwarranted and misleading constructions on others. One example will suffice. Our “final paragraph” did not “further suggest that this sum (£20,000,000) could and will be used for normal Government expenditure. What our final paragraph did purport to say was that Mr Nash, by the policy he adopted in connection with the exchange rate transaction, could, if he so wished, square his State accounts m the coming year by getting the Reserve Bank to create whatever credit o.i money he needed. This is the punting press technique” to which, we referred. Cur correspondent accuses us of “misrepresenting facts.” That is untrue. From the above quoted instance of a mis-statement and from a careful perusal of today’s editorial, readers should not necessarily have any hesitation about coming to their own conclusions as to where the charge of “misrepresentation” should really lie. —Ed., Evg, Star. Communist Candidate Sir.—l was interested to read in a recent issue of your paper that a Mr Mitchell was contesting the Westland seat in the interests of' the Communist Party. It would be more interesting to learn if it is the intention of the Communist Party to contest those seats where the Labour Party candidate was ’ returned by only a small majority at the last election. As Mr Mitchell has now been declared the official candidate, he may perhaps be prepared to enlighten me.—Yours etc, NOT BEING FOOLED Greymouth, August 22.