Manawatu Evening Standard. WEDNESDAY, AUGUST 11, 1920. NEW ZEALAND’S FINANCIAL REQUIREMENTS.

Manawatu Standard, Volume XLIII, Issue 1887, 11 August 1920, Page 4

Manawatu Evening Standard. WEDNESDAY, AUGUST 11, 1920. NEW ZEALAND’S FINANCIAL REQUIREMENTS.

It would he a mistake to assume that the financial position of the Dominion is viewed with equable feelings by the financial authorities and the commercial world generally. On the contrary, there is a growing'sense of uileakinoss and the feeling that the country is drifting into a dangerous position as a result of its rapidly increasing expenditure and the h.eavy calls made upon the taxpayer by the Government. To do him justice, the Prime Minister has himself more than once raised the warning note that increased expenditure can only be met out of increased taxation revenue. Yet, deputation after deputation waits upon him in his capacity as Minister of Finance, to demand all sorts of tilings that can only be conceded at the expense of the taxpayer, the unthinking portion of the public insisting that increased moneys must be provided for housing and educational purposes and for grants in every direction, probably not one in a hundred stopping to inquire where the money is to come from, much less at whose expense it is to be provided. To slay these growing demands for State assistance, to all sorts of projects with which the public should not bo saddled, soems almost impossible, and it is becoming increasingly necessary, if a crash is to be avoided in the not remote future, that some sort of campaign should be entered upon to educate the people up to the old self-reliant spirit displayed by the pioneers of settlement in this country. Spoon-fed as the public has been for the last thirty years, or more, there is a noticeable absence of that spirit of sturdy hide-' pendence which characterised our early day settlers, who faced hardships and privations in the backblocks, the mere thought of which would set the average city dweller shuddering to-day. That Ministers have a hard row to hoc in resisting the demands that are made upon the public Treasury can be readily understood. They are the custodians of the people’s moneys, and it is to the people they must look for any and every increase in the public expenditure. That lesson is being painfully driven home to most of us by the increased cost of everything, and by the higher postal and telegraphic rates we are called upon to pay, with the prospective rises in railway fares and freights to make good the increased cost of those public utilities. Taxation remains heavv—too heavy. Yet La-

hour advocates demand more. Loan moneys to the extent of twenty-live

millions are required within the next twelvemonths to meet loans falling due, and moneys required for soldier settlement and repatriation purposes, and for public works purposes, etc., and we have had the Prime Minister hinting that, if the money is not forthcoming, compulsion will he resorted to for the purpose of enforcing contributions from those who do not respond voluntarily. Mr Massey seems to think compulsion will not he necessary. We can understand and appreciate his desire to keep the rate of interest down, but he will he making a serious mistake if he attempts to issue the big loan he. contemplates raising on the same terms that the £2,000,000 loan was offered. With the marked rise in the London money market, where even the most favourable terms for new loan issues involve interest payments, at the rate of G per cent., and with the many lucrative opportunities offering for the investment of moneys in this country, the Government must, and should, accept the responsibility of raising the loan interest rates to at least s\, if not (i per cent., and it should abandon all idea of compulsory contributions, since the latter involve taxation of the most vicious kind, as may he seen any day in the market quotations for War Loan stock, which many- holders have been j forced to quit at a heavy loss. The money must ho found, hut it can and, wo believe, will he readily obtained if , t|io pow loan issue is made sufficiently

(i.-y.t.ixt .*.*» ■.> i • ■,• t r •. i attractive to the smaller class of investor, and issued say at (5 per cent, for fivp or ten years. The Commonwealth is offering G per cent, for its latest loan, and New Zealand can hardly offer less. Meanwhile both the public and the Government should act upon the “go-slow” principle, adopted by their friends of the Labour Patty (though from a very different motive) in regard to all further demands involving either increased expenditure or taxation.