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Hokitika Guardian, 27 May 1938, Page 4

Some reflections of Professor Linnet Bobbins, professor of economics at London University, on the British Budget apply with almost equal force to New Zealand public finance. Writing in Lloyd's Bank Monthly, lie says:—The posit'on whit h we have to face at the moment is a position in which public expenditure has been rising faster than the national income. There can lie no doubt, that '.since 1935 the rise in expenditure has been relatively greater than the rise in income. That it has been necessary to increase rates of taxation is sufficient indication of this. It is .possible, oF course, that expenditure will not go on increasing: in which c perhaps, a rise in the national real income would gradually reduce the proportion going as public expenditure. But, in the present condition of Europe, lie would lie a brave man who would predict this with any confidence, There is another feature of the situation which is relevant at this point if we are to get things in .historical perspective. ]n the 19th century, the weight of debt contracted during the Napoleonic wars was eased in part by a growth of taxable income clue to growth in population. In the present century this easement does not seem, to be probable. The population of Great Britain has nearly reached the end of its growth. There may be some increase in the number of taxable incomes due to changes in the ago composition of the population. But it is evident that the margin of safe policy is much loss than it was. The extent to which we can contemplate safe increases in unproductive borrowing has diminished.