NOTE OF THE DAY

Gisborne Times, Volume LXXIII, Issue 11841, 24 January 1933, Page 4

NOTE OF THE DAY

AN IMPORTANT CAUCUS

The Coalition caucus to-day is likely to prove the most- important held in the history of the present Government. When Cabinet induced the banks to peg exchange up to- 25 per rent., it held back from the public other important details of its rehabilitation plan. Some indications are now given as to the full programme, which, it will be noted, include proposals aimed at pacifying city interests. There can bo no question but that business-folk will welcome a further reduction in bank overdraft rates just as heartily ns the producers. Tf it should prove that substantial tariff reductions are intended. business will be assisted and the cost of living should, in due course, show some reduction. What requires to he borne in mind, however, is this: that t.he full effects only of the higher exchange can at once manifest themselves. On every hand, it is admitted that the only way that was open to the Government to enhance the producers’ returns was by means of higher exchange or the bounty system. Having adopted one of these methods—the former—the Government is now in duty bound to take other measures which will reduce not only existing burdens weighing so heavily upon the people as a whole hut also the extra burden involved in finding the money to meet the additional premium that has been granted the producers. .No one, can, of course, profess to know how far tire disadvantages arising from the increase in the exchange will exceed the advantages. If what has now been done is right and proper, then, assuredly, it would have been much more beneficial if it had been done On August Ist last when the current export season opened. The belated decision to enhance, exchange lias meant that producers who have held back wool and other commodities will now make an unexpected gain. What- is not clear is how local bodies and importers are .to be helped out of the prob-

lems with which they will now be

confronted. To-day’s caucus will disclose whether or not the Government intends to make to the cities .and towns concessions as great as are being made to the .rural community.