THE NATION’S INCOME.

Manawatu Standard, Volume LVIII, Issue 74, 24 February 1938, Page 8

THE NATION’S INCOME.

REPLY TO ECONOMIST. SPENDING ON PUBLIC WORKS. , PAHIATUA, Feb. 23. A pointed reply to the views expressed by Mr Colin Clark. through the newspapers last week concerning the national income and taxation in New Zealand was given by Mr 0. C. Mazengarb in an address under the_ auspices of the. National Party to-night. Special interest attached to the controversy as both Mr Clark and Mr Mazengarb hold an M.A. degree in economics. Mr Mazengarb is a graduate of the University of New Zealand and Mr Clark of Cambridge. Added interest was given to Mr Clark s statements from his political associations in Britain. It is recorded in “Who’s Who, 1938” that he stood in the Labour Interest for North Dorset in 1929, Waver tree in 1931 and South Norfolk in 1935, and is a prospective Labour candidate for tlie last-named The Mayor (Mr J. D. Wilson)' presided over an attendance of 300. It was one of the largest political meetings held in the town. “Only -last -week,” said Mr Mazengarb, “Mr Colin Clark, in appraising the policy of our Socialist Government, made these surprising statements: —

“. ‘The loss that a decline in overseas values would cause to New Zealand could be offset by maintaining a vigorous public works programme and by .maintaining the spending power of the farmers. . . New Zealand’s national-income depended on the maintenance of a Public W’orks programme that would eventually give a national return. . . Any cut-down in Public Works would cause a stagnation of savings and a reduction in the national income.’

■ “What utter nonsense!” continued the speaker. “For Mr Clark to claim that our national income depends not on what is produced by the farm and the factories but on what is spent in public works is to stand the truth upon its head. “We are spending at an unprecedented rate on public works in these prosperous times; but if prices fall and less wealth comes into the country Mr Clark would make a further annual addition to our public works expenditure. That is his way of solving our problems. “Unfortunately, for Mr Clark, he has not been in the Dominion long enough to have read the speeches made by Mr Savage and reported in Hansard, or he would have seen that Mr Savage has a different idea of the usage of public works. This is what Mr Savage says on the point:— “‘I admit «uite frankly that public works are not going to solve the problem of unemployment. In order to .solve the problem of unemployment we have to get the people fitted into the industries and services of the country.’ ‘ ‘This speech showed that the Prime Minister; had the right idea, which is diametrically opposed to the propaganda recently broadcast by his department from Mr Clark. It is a great pity that the spending proclivities of his Ministers rrrevent him from carrying his ideas into effect. “A lessening of taxation and a relaxation of the grip at present exercised on business interests would encourage a launching out in industry, an increase in buying power and a reduction in unemployment. But this is impossible under a' Government pledged to a policy of spending the people’s savings and assuming the ownership of all industries.” Mr Mazengarb said that the broadcasting of Mr Clark’s views illustrated the increasing tendency on the part of the Government to allow people l from other countries to come over here and take charge’ of their ideas and affairs.

The following resolution was carried, with half-a-dozen dissentients:— “That a pledge be given that we will do all in our power to assist the New Zealand National Party to sweep from office the Government which by its actions has shown conclusively that • it is incapable of sound government, and unworthy ,of the trust which the country reposed in it two years ago.”