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Manawatu Times, Volume 61, Issue 189, 12 August 1936, Page 12

ME. W. MULHOLLAND IN P.N. At a meeting of farmers held in Palmerston North yesterday to meet the new president of the New Zealand Farmers’ Union (Mr. W. Mulhollaud), Mr. E. 0. Bond presided. Mr. Mulhollaud, as iu other speeches delivered in the district, stressed the need for complete organisation of the farming community. All wage earners were being forced into specific organisations under a penalty and their interests, iu many ways, were opposed to the interests of the farming community. The only choice before the farmer, therefore, was to organise just as completely unless he desired to bo ground down and down by those other sections. Mr. Mulhollaud averred, in addition, that unless the farmers did organise, the policy of the Government must fail because the Government needed the united strength of the primary producers. He was pleased to be able to say that the strength of the Farmers’ Union was growing. Speaking of the economic trend, the speaker said the union’s policy a year ago was to reduce costs. It was not high prices that spelt prosperity but the relationship between costs and prices. It was the fact that costs had remained high while prices were low that had brought about the depression. That policy of reducing costs was a wise one but since then a new Government had come into power with the.policy of raising costs but not doing very much to raise prices to give the farmer sufficient to remunerate him for his labours. The added costs that must follow the introduction of the 40-hour week must fall directly on the shoulders of the farmer. Wages had also gone up and all these inflationary measures were going to raise the cost of living. When the Primary Products Marketing Act cams into forco the Government would have full control of exchange and would use it to differentiate as to what imports would be allowed and what would not. This meant further inflation and added costs. The situation that was developing was a serious one because the Government had already lost control. It had failed to realise that the sequence with which it had brought its policy into force was important. The election pledge had been to raise prices first but the Government had started off on the wrong foot. Further, what had been done in the last six months could not be altered—not even a dictator Could stop the movement of inflation. ! But to remedy the situation the Government could carry out the whole of its policy and raise prices as well. To stop now would be to recreate the economic morass of 1931 and the farmers must insist that the Government put the whole of its policy into operation. One might guess the reason for the reluctance of the Government in putting the rest of its policy into operation. The workers had got their higher wages and shorter hours and were satisfied. They were wholly organised and had succeeded in their efforts with the Government. On the other hand, the farmers were not wholly organised but if they were, the Government would have no hesitation in carrying on with its policy.

The guaranteed price proposal was purely a compulsory pool aud the price announced had been disappointing. However, under the Primary Products Marketing Act, the Government had the power, in conjunction with the Reserve Bank Act, to make the measure an inflationary one and so pay out any price they might think fit. In that direction the Act was satisfactory and the Government could inflate prices to any level they desired. It was unfortunate that this step had not been taken first instead of the other one of raising costs. Had the Government proceeded in that way they would not have lost control of the economic situation. ,

Air. Alulholland declared that company taxation was indirect taxation as it was passed on to the customer every time. The Government had entirely misunderstood the incidence of that form of taxation. It was quite the reverse of the direct taxation policy which tho Government had declared for. He believed the Government was anxious to bo fair and ho felt sure that when the facts were made clear to them, they would realise their mistake,