GOING THE PACE.

King Country Chronicle, Volume XXVI, Issue 3447, 24 March 1932, Page 4

GOING THE PACE.

In all the measures that are being brought down by the; Government to economise there is opposition from some quarter or another. Where these affect the individual he is apt to consider that he is being unduly pressed for the benefit of another, and whatever legislation is passed during the emergency session of Parliament to deal with the present economic position there will be dissatisfaction on every side. It would appear, however, that there is a large section of the community which does not realise how serious is the position facing this Dominion, and how close we are to the edge of a financial precipice. For years we have been borrowing millions of money. It seemed so easy to obtain that money, and any Government which borrowed money became popular. No thought was given to the day of reckoning, and this has now overtaken the Dominion. When Mr. Massey took over the leadership of the Government from Sir Joseph Ward, the funded debt of the Dominion was £84,353,913; thirteen years later our national debt had swelled to £277,814,617, this sum including over £80,000,000 spent for war purposes. Mr. Massey was succeeded by Mr. Coates, whose Government added another £23,581,607 to the public debt. Then Sir Joseph Ward again took office at the end of 1928, and during his seventeen months as Premier another £16,000,000 was added to the load

of the Dominion. Mr. Forbes became Premier in May, 1930, and in less than two years the Government borrowed something like 12£ millions.. Taking a general average of 5 per cent, as interest and cost of raising I these loans, the extra amount that the Dominion has to find every year since Mr. Massey assumed office in 1912 is nearly £12,000,000 in interest. Allowing that a substantial proportion of these loans were spent on productive works by the Government, and that part of the borrowing was unavoidable on account of the war, these figures must- give any but the most irresponsible some food for thought, and make them realise how necessary it is for following a policy of strict economy. The total indebtedness of New Zealand on 31st March last was £276,033,358, or £l2B 13s. lOd. per head of population. No money is now available for borrowing, and even if it were it would be nothing short of madness to think of adding to the country's already heavy expenditure. We have now to pay a total of 14 millions every year in interest on our public debt, and this could only be done by doubling taxation during the last 20 years. Three-fourths of this huge sum has to be sent from the country on account of overseas loans, and this means that we must have a favourable balance of over £10,000,000 as between our exports and imports if we are to balance our overseas budget. This balance has not materialised over the last twenty years, and this shows that the Dominion has been drifting to its present position over a long period. While the various Governments have been primarily responsible for this borrowing, they did so with the approval of the people, who must bear their share of responsibility in the matter, and also help to make the adjustments that are necessary to meet the situation now facing the country. Even if the money market improves in London, and we obtain better prices for our exports, it would be a weak policy to borrow money for State purposes. The country is carrying a tremendous burden in adhering to its borrowing policy, and to add to that burden would mean ultimate disaster for the Dominion and its people.