The Manawatu Daily Times The Dominion’s Finance

Manawatu Times, Volume LVI, Issue 7066, 27 January 1933, Page 6

The Manawatu Daily Times The Dominion’s Finance

The retirement of the Hon. W. Downie Stewart from the Coalition Government is a much greater surprise and shock, for the time being, to the people of Wellington than is the resold of the remaining members of the Cabinet to a rise in the rate of exchange in the interests of the primary producer. It is but a few weeks ago that Mr. Stewart returned to the Dominion bearing the eulogies of financiers at Ottawa and in London, and now he has lain down, for the present, a mastery of national finance which none of his colleagues yet has achieved. It will be remembered that Mr. Stewart came into the House of Representatives in 1915, hale and hearty enough to take an officer’s part in the Great War and sacrifice much in the service of the nation, but it was not until 1919 that he became a member of the Massey Ministry and of inestimable value to his chief.

The Right Hon. J. G. Coates, who is, by the way, to occupy the position at the Treasury vacated by Mr. Stewart, takes an airy view of the situation as it appeared to him at the week end. “The exchange rate is a controversial problem on which there has been no lack of discussion,” he tells the public at large. “The pros and cons have been set forth exhaustively, and the arguments are fresh in the public mind,, so that it is needless to say much at this juncture. The wisdom of the action that has been taken can only be borne out by experience. I believe that the decision of the Government to take, a part, and, indeed, to assume responsibility in the matter will be shown to be justified. Time will tell.” This is all very fine and large so far as it goes, but it leaves the average taxpayer wondering what it all means.

It has been whispered abroad that Mr. Coates’s achievements at Ottawa have not borne all the fruit that was expected of them. It is an astonishing thing that the man who so clearly and so sympathetically expounded the policy to which each and every Dominion subscribed at Ottawa should now have persuaded the Government of his own Dominion to adopt a policy of an exactly opposite kind. Formally, of course, the exchange rate is a different matter from the tariff, but in some of their effects the two are identical. The 25 per cent, exchange, rate will damage British trade ten times as much, as the additional tariff preference of per cent, will benefit it, and it will apply to all British exports in this country instead of the four items specified in the Ottawa Agreement. It really does look as if the new Minister of Finance were beset by more than one embarrassment.

Of course, as nearly as possible after the resumption of Parliament, Mr. H. E. Holland, the leader of the Labour Party, will have a vote of “no confidence” of some sort against the shaken Coalition Government and so give Mr. Forbes and his colleagues an opportunity to burnish up their holiday-making battalions. Addressing his own people at ’"Westport, Mr. Holland reiterated the old story of how the present financial trouble would be overcome by a judicious use of the credit of the country. This panacea seems now to have been adopted, or at any rate set aside for further examination, by the Coalition leaders, who so far have gone further towards its application than have Mr. Holland and his colleagues. It is conceivable that the rise in the rate of exchange may appeal to both the Coalition Government and the Labour Opposition and that the outcome of the future may be a better informed party led by Mr. Stewart.