The Star. FRIDAY, JUNE 6, 1919. NATIONAL INCOME AND INDIVIDUAL SHARES.

Hawera & Normanby Star, Volume LXXVII, Issue LXXVII, 6 June 1919, Page 4

The Star.

FRIDAY, JUNE 6, 1919. NATIONAL INCOME AND INDIVIDUAL SHARES.

Oellv«rod every ev«nlns: by 5 o'cloo* In Hawera, Mara a, NoimaDby, Okaiawa, E.'tharn, MunifbUiki, K^potiga, Awstuna, Opunako, Ot<»l'<=hr>, Mr»nutahi, Alton, Hurleyvlllo, Patea. Waverley.

+ So much has appeared in our columns recently arising out of a comparison of the incomes of the dukes and of the laborers that one feels he ought to apologise for touching further on the matter, even indirectly. But the present reference is not designed to be controversial, and does not lay claim to originality: it is intended simply to bring under public notice some facts relating to the distribution I ipf national income set forth in a book i written by a British economist, Professor Bowley, and the lessons drawn fnain those facts. So far only reviews of it .are obtainable in New Zealand, and joo .doubt the prepossessions of a reviewer may quite easily affect, if not his precis .of ihg facts, at any rate the deductions he draws therefrom. We take the Westminster Gazette's review as the more useful, because we think the Gazette is less likely than some other' journals to be prejudiced in favor of the privileged classes. Professor Bowley set out to analyse the pre-war division of ihe products of industry in Great Britain. Ifc is true that there have been material changes since the war broke out, and also that owing to the time taken to collect and tabulate and check statistics the figures relate as far back as 1911, and thei-efore are apparently somewhat out of date now, yet war experiences viewed at large are ibut a passing phase, and there can be no essentially great conflict between the ascertained figures for 1911 and the probabilities of 1919, except that the destruction of capital during the war must for some time to come tell more against the capitalist than against the worker. Professor Bowley, then, sets down the national income of the United Kingdom for the year under investigation at £1,900,000,000, a sum which, we may say closely approximates, allowing for a decade's progress, to the estimate for the year 1901 by the late 'Sir Robert Giffen. Of this sum of

£1,900,000,000 Professor Bowley finds

£8,000,000 (42 per cent.) was paid in wages.

£264,000,000 (13 per cent.) was paid in small salaries, or earned by independent, workers or small employers whose income was due almost entirely to their own exertions.

Including old age pensions, nearly 60 per cent, went to people whose annual income was below the exemption limit for income tax, i.e., £160.

The remainder (£742,000.000) went to the income tax-paying class; and Professor Bowley divides it as follows:

(1) Earned as salaries or by farmers, £145,000,000.

(2) Unearned (i.e., from real property or securities), £190,----000,000..

<3) Profits of trades or professions, £407,000,000.

The average salary of salaried persons paying income tax was about £340, and the average profit of persons assessed to profit in the same class about £500. Suppose these "earned incomes" were cut down to an average of £150, we are left with a balance of £550,000,000 as "the outside estimate of the part of home-produced income that is the target of attack by the extreme Socialists." But out of this sum the greater part of the national saving needed for capital is made and a large part of national expenses are met, and when these are subtracted only 200 to 250 millions remain which on the extremist reckoning can have been spent out of homeprod aced income by the rich or moderately well-off on anything of the nature of luxury. This sum, Professor Bowley points out, would have been little more than sufficient, if it could all have been realised and all have been transferable (obviously an impossibility) to bring the wages, of adult men and women up to*the minimum of 35s 3d a week for a man and 20s for a woman. The Westminster Gazette quite fairly says that it is undesirable that- any one class should use the results of the analysis to point a moral at another class. The rich, and well-to-do must realise what an extraordinary privileged state of being they enjoy compared with the great majority of their neighbors, and "they should walk carefully, be cheerful taxpayers, and avoid wasteful and luxurious expenditure." But for the working class the moral is that there is little or no prospect of relief by a mere distribution of the present incomes. The rich are too few, and what they spend on themselves is in the aggregate too little—however glaring in individual cases —to add much to wages, even if it could be trans-, ferred from pocket to pocket. But a simple transfer as commonly conceived is almost certainly impossible. The greater number of the values and credits lumped under the name of income belong to an economic system which would be destroyed by a communistic experiment, and, as the Bolsheviks have discovered, vanish in the act of conveying thorn from one class to another. "The upward way," ©oncludes the Westminster, "is the way of producing more, while at the same time all possible care is taken that the product is well distributed." The lesson and the advice are for New Zealand as well as for Great Britain. Here already wealth and income are more equally distributed than in older countries; there are but rare instances

of extreme wealth and extreme poverty, and efforts never slacken to further ameliorate the conditions. But no more in New Zealand than elsewhere can communism and Bolshevism Kelp. They could only hinder,'because

they would discourage industry and production. The main cause of trouble in this Dominion to-day is insufficient production to meet suddenly increased demand, and a consequent increase in the cost of living. The cost of living here is influenced, if not absolutely governed, by the cost of living in the older countries of the world, where the war has diverted labor from its ordinary occupation and checked industrial production; and relief can only come gradually as more food, more goods, more of the articles in world-wide common use are produced !b,y the ; people of the world at large.