REVIVING INDUSTRY

Manawatu Standard, Volume LIII, Issue 255, 25 September 1933, Page 2

REVIVING INDUSTRY

ABSORPTION OF WORKLESS. MR POLSON’S CERTIFICATE PLAN Loan certificates for industry to enable full-time absorption of the unemployed at standard rates, the State to bear any losses incurred, were part of a plan advocated by Mr W. J. Poison, M.P. for Stratford and president of the New Zealand Farmers’ Union, in an address to the Palmerston North ’Rotary Club to-day. Mr W. G. Black presided over a large attendance. Many things seemed unorthodox nowadays, but this was an age of unorthodoxy, said Mr Poison in introducing his subject. It wps a time of changing ideas and new thoughts. Things thought sound for a lifetime were being abandoned, and the world problem of 35,000,000 workjess men and women challenged civilisation, almost constituting an impeachment of existing and long standing methods of dealing with this question. President Roosevelt had expressed tho opinion that there was something wrong with the ' world machine, and had adopted a bold and courageous policy in his determination to create a plan giving all a reasonable opportunity, despite the crusted opposition of a thousand years of conservatism. He was seeking an ordered democracy by attempting to steer between the extremes of Fascism and Communism. Capitalism in America had led to a monopolistic control. Being the representative of the Farmers’ Union, Mr Poison said its policy for thirty years had been one of providing equal opportunity for all on the basis of eo-operation instead of socialisation, which seemed to offer the only alternative to the present system. The latter scheme of dealing with the u nem ployed was uneconomic, men were not receiving the work for which they were trained and consequently it was of no benefit, the methods did not encourage the re-absorption of men iuto industry, the tax was harassing, unpopular and Inelastic, and there were other disabilities. Many of the country’s troubles would disappear if men could be found suitable and congenial employment at reasonable rates. The absorption of this labour meant that additional purchasing power would have to be created. It had to he ascertained whether men could be taken from the pool of unemployment in this country and put hack into industry with success. Mr Poison thought this could be done, and said he did not claim any originality for the plan which lie advanced. Two leading world economists had arrived at the idea simultaneously. VARIETY OE SCHEMES. The creation of a national office for the issue of production certificates as loans without interest had been advocated by a European economist, the speaker added. Another, in America, urged the setting up of a national emergency corporation to pay men with consumption certificates, transferable and having a money value which could be redeemed. A third plan was that Governments should agree to make grants from the unemployment funds under strictly prescribed conditions to firms to cover any loss incurred in fulfilling a specified contract or in operating tlieir industrial plants to full capacity. No firm inefficiently eqiiipped or organised would be eligible, or no industry where wages and working conditions were unreasonable. Books would have to be open for inspection. The suggestion was for a national board to issue loan certificates to approved undertakings for the employment oi additional labour. These would be paid in scrip to be accepted as legal tender and redeemed on presentation to the national office. The isues would be under the control of the Audit and Income Tax Departments which would have a check on every operation. The State would hear any losses incurred. The validity of the notes would have to be for a limited period in order to safeguard against falls in price levels. There was nothing novel in it. There were already orders, coupons and bills, and even cheques were inflationary certificates. No fresh capital would be issued in excess of saleable production. Provided all the unemployed were absorbed —and the speaker did not suggest that they should be —it would require £10,000,000 per annum at standard rates to achieve this. The security would have to be satisfactory. Assuming activities on that basis, the infusing of an additional £10,000,000 into circulation would, on present figures, in addition to men reabsorbed under the scheme, indirectly benefit those in work to the' extent of 50 per cent, of the amount involved in the scheme. Threequarters of what was consumed here was produced in New Zealand. Assuming that there was an increased income of 50 per cent., local consumption would increase by at least 25 per cent, and the number employed in local industry from 74,000 to 112,000 if only half the number were absorbed, while wages paid would increase to the extent of £8,000,000 yearly—a direct increase in spending power. SUBSIDIES TO INDUSTRY. Almost £5,000,000 yearly was being spent on the unemployed in New Zealand, Mr Poison said. Subsidies to industry under this plan, even if a loss of 2(j per cent, were incurred, meant a loss to tho State of only half the amount now being paid out. Under this scheme it should be quite easy to absorb the unemployed and tho extra amount earned and the extra production would balance conditions. It was clear that tho existing methods had failed, and that there were more unemployed than ever. President Roosevelt was putting into operation a scheme based largely on this method. It could go hand in hand with land development, in which there was considerable scope for improvement. Things had reached a stage where social unrest endangered every section of the community. Something must be done. The scheme had its imperfections, but it was an honest attempt to grapple with a problem for which in this country no intelligent plan had been advanced at all. Mr Poison believed that, with proper co-operation, President Roosevelt was going to achieve wonderful things and set up a new system which would save civilisation from a very drastic and unpleasant change by pursuing a middle course. The problem of unemployment should be dealt with before local body amalgamation, and such questions as tho Poultry Bill. It was essential that New Zealand should put her house in order. The speaker was accorded a hearty vote of thanks on the motion of Mr G. G. Hancox, who said the plan was an appealing one, and deserving of every consideration. Visitors welcomed were Messrs J. Linklater, M.P., T. R. Hodder, TV. J. Pearce, E. Burrough (Picton), D. McDonald (Wellington) and H. J. Poison (Fordell). The tokst of the Rotary Club of Singapore was proposed on the motion of Rotarian S. E. Black.