The Country’s Ghastly Extravagance

Manawatu Times, Volume LII, Issue 3576, 6 April 1927, Page 8

The Country’s Ghastly Extravagance

Government Forfeitimg Confidence of Producers The Essential Needs of Agriculture “At the request of many people,” says Mr. W. J. Poison, Dominion President of the New Zealand Farmers 5 Union, in his address to Provincial Presidents, “I have stated below some of the chief planks of the policy of the Farmers 5 Union of New Zealand. The present crisis has accentuated the necessity for their general adoption. They deal with labour conditions, finance, land settlement, markets, tariff reform, and drastic retrenchment in public expenditure. In a country so entirely dependent for its prosperity upon the success of agriculture the first essential is to secure the return of the primary producer to some semblance of prosperity. This can only be done by creating a better understanding with other sections of the community. Enlightenment about the position of the producer will lead to a better knowledge of these problems and a better appreciation of the need lor grappling with them.

Labour, Wie Arbitration Court must cease Haying the role of industrial .providence, and the law be amended to cause it to have some regard for the price obtained for the product. , The alternative to the Court would be the creation of Wages Boards or some other more practical and less academic tribunal. It is t'iser to review and amend the existing law. In any case it must be made possible for third parties who, as producers, are affected by such awards as the recent Freezing Award, to be joined in the dispute. Preference to unionists has become a menace to the progress of the community and should be done away with. The open shop is the main factor in American successful production, Here, as the result of the opposite policy, we have just had the spectacle of numbers of slaughtermen ceasing work at various hours of the day or for the whole day in the height of the season, as the result of inflated wages, although the works accommodation paddocks were congested with stock and unemployment has become a national problem. Queensland has been the home of socialistic experiments and still ‘ has a labour government in control,’but the Queensland Court recently refused the workers an increase because they could not prove that the Industry was, one of, more than average prosperity, yet the New Zealand Arbitration Court has laid it down that the position of the industry has nothing to 'do with the rate of wages. ■ • - r ’ Costs Must Fall; ; If this Dominion,is to overcome its present difficulties, costs, must, be reduced and the greatest cost factor is labour. As the result of high costs farming, land is depreciating in value at the ratb- of more than a million sterling per annum through the growth of weeds and second growth. It is also depreciating through the fall in the value of our products.. A suit of clothes which, before the war costs £S 10s Od is worth at least £lO 10s Od to-day. Similarly, land which was worth £6 10s Od per acre pre-war would require to ' pe worth £lO 10s Od, to-day if It Is not to show a depreciation’in productive value. A mere 10 per cent, of the land, of the Dominion was affected hy price inflation, and. there is ample evidence to show that not only this 10'per cent., but the -whole of our farming land is now deflated to below pre-war values. Production is at a standstill, although our mortgages have enormously increased and the' huge. loss of ten million sterling made last year as compared with the previous year will undoubtedly be exceeded this year. Are farmers prepared or Is the country generally prepared to allow this to Continue? With no prospect (how that we have returned to the gold standard) of increased prices, we are facing disaster unless we take the matter in hand at once. Hundreds of black-1 blocks settlers have been living on less than 12/- a day for years, whiU others have seen their- capital disappear. It is not desirable to reduce the standard of comfort if it is possible , to avoid it, but reduced costs will help the worker as much as the farmer by enabling him to purchase more than he can purchase to-day. It Is unfortunate that workers will not realise that they have nothing to fear from any policy that will assist to bring about a return to prosperity. Retrenchment In Public Expenditure. We have been living in an era of ghastly extravagance. From 1920 to 1927 our exports amounted to £327,000,000, but’our imports and interest charges combined amounted to £408,000,000, or a debit of £80,000,000. Meanwhile the Govern, ment borrowed £38,000,000 to keep up the semblance of prosperity. Thus we are living at the rate of £10,000,000 a year above our income and borrowing a year to help keep up appearances.There must be drastic economy. We paid £1,914,000 in salaries in 1914. Wo paid £4,352,403 in 1926. We have increased our railway expenditure from £3,004,180 in 1914 to £5,980,798 in f 1192 G; Education from £1,420,941 to

£3,809,406 in the same period; and Post and Telegraph from £1,170,882 to £2,406,791. What justification is there, for example, for an increase in Post and Telegraph salaries from £699,245 in 1914 to £1,825,883 to-day? We are certainly not getting three times aa good a service. Enormous borrowings for public works must be slowed down. Highways, for example, are being constructed that we can do without, and Hydro-electric works far ahead of our justified needs. Municipal extravagance 'must be curbed. It is easy to spend money. It requires a strong, man Or a strong government to practice economy. Only rigid economy can relieve the tremendous pressure of traxation upon the- only people who in the ultimate issue have to pay It. If reductions in salaries are necessary they must begin at the top. The primary producer has been living on his capital for years. It is time others shared the sacrifice. Agricultural Finance. Money at the cheapest possible rate so that existing mortgages may be converted or renewed at a lower rate of interest is an essential in the pre-. sent emergency. The average interest rate is 6.22, while the average rate paid by the farmer is much higher than that. In some districts stock mortgages arc as high as 10 per cent. The scheme of agricultural banking must be placed upon the. Statute Book in Its entirety and developed with vigour and enthusiasm in the interests of the producers. It may be necessary for the Government to devote some of its funds to subsidise this system, and it should be done without hesitation. Other countries do it. No tinkering with this question should be tolerated. The Government must be made to act promptly or forever forfeit the confidence of the producers. The Bank of New Zealand’s scheme applied as it is only to its own clients extending only up to 50 per cent, of the bank's own valuation of the so curity, and with 20 years as its longest term, loan, thus creating a paralysing interest and amortisation payment of 8 2-3fds per cent.,, while possibly satisfactory to th e bank is quits useless to the great body of producers, Land Settlement. Land settlement is at a standstill The Government self-confessedly impotent is slowing down immigration to a country whose only hope is increased production. Instead of spending millions on broad highways and high power lines and increasingly costly public services the Government’s duty to put men to work on some of our deteriorating lands even if it has to take over the farms to do it . . The proof that millions of public moneys have been wasted lies in the fast that there are fewer farms, fewer farm workers and less land ia production than two or three years ago. In a country entirely dependent on primary production for its income there must be something far wrong when all this expenditure only increases the stagnation. These lands must be got back into production and the Government’s business is to sec tc It as part of a national policy: Tariff Reform. Som e sanity in regard to tariffs is an essential condition if we are to lower values in Now Zealand. The Government, by the creation of a tariff commission only five years alter its last increase in customs duties, has opened the door for another increase All these things fall on the shoulders of the farmer. He cannot pay and in consequence the rest of the community receives no real benefit, but on the contrary suffers from the stagnation which these inflated artificial values create. Wo cannot do without tariffs in a growing community but New Zealand Is rapidly becoming a high protection country wthout any of the physical or geographical reasons which render such a policy advisable in other countries. The only sound policy for New Zealand is to inci'caso production and where tariff reductions arc necessary in order to do so they, should 'os made. The tariff should be the servant of the people and not its master. New Markets Essential. Markets arc as essential as mar-

keting, and both must be sanely catered for. Dairy control in the hands of extremists may do much to destroy th e markets we already possess, but dairy contol, however wisely administered will never provide us with insurance against sluihping markets while all our eggs are in one basket. In these days one of the objects of. a customs barrier is to enable tariff bargains to b e made between countries for the advantage of both. If we are to enlarge our field, some such arrangement is necessary. Great Britain is doing her best, but she cannot absorb all the butter her free trade policy lands on her shores. It will be no disloyalty to the Mother Country to adopt the policy, which was responsigle for her greatness and trade wherever trade is possible.