New Zealand’s Prosperity

Manawatu Times, Volume 63, Issue 151, 29 June 1938, Page 3

New Zealand’s Prosperity

EXAMINED BY CHAMBERS OF OF COMMERCE NATIONAL SECRETARY SPEAKS IN FEILDING Speaking before a meeting of the Feilding Chamber of Commerce on Monduy evening, Mr. A. O. Heany, secretary of the New Zealand Associated Chambers of Commerce, said that individual businessmen, company directors and others, who had sounded a note of warning from time to time about the lavish public expenditure in New Zealand to-day, had been accused of obstructionism when the fact wa» that conditions wero prosperous, business had improved, and the people were enjoying better times. What was the explanation for their apparent stupidity in advocating something that would deprive them of profits! There was no doubt that there was plenty of money about, and business was better, but businessmen looked a little further than that, and asked themselves whether the country was really getting back to work, conserving and employing capital, producing new goods and forging ahead on a stable basis, or whether the stimulus of to-day was largely artificial through the deliberate rc-distributiou of existing income which took from one and gave to another, and which did not add to our income. Enormous public expenditures by political agencies were dissipating potential wealth. These spendings were what businessmen called overhead, and were not productive expense. The money had come from productive effort, but it was not being re-employed in the same way. Before tho war taxation took 2a -Id in the £ on the country’s production, whereas in 1936-37 it had gone up to 5s 5d in the £, said Mr. Heany. In ether words, there was to-day more governmental overhead and less capital left for private enterprise with which to experiment in new enterprise, providing new jobs. The speaker said that a factory with a handful of employees was of more national worth than the rnuroie structures of political agencies. Thousands of men had been drafted on to public ! works undertakings and were then de-! scribed as being in full-time work, and so were considered to be happily dis- : posed of, at the samo time as the basic i primary industries of the country were [ crying out for man power and facing the tide of rising costs. The country | and ownership had been so discouraged by latter-day additions to legislative ( restrictions and deterrents of earlier years that the only notable activity in this sphere was the present attempt to fill the need by publicly-built houses for renting, which was hopeless us a

means of filling the nation’s need, and which destroyed the British tradition of home ownership. The commerce of the Dominion was impeded by dilatory work on the waterfront, and goods were having to be overcarried and returned over many miles. New Zealand was being told that the eyes of the world were upon it, but perhaps it was not altogether in the way we would like, said the speaker. New Zealand might well have a look overseas —at Sweden, for instance, which had decided to institute a longrange programme of public works for a period of ten years, aud to build up, out of surpluses, a strong cash reserve which could be drawn upon whenever it became necessary to stimulate employment. This was a scheme tee principle of which had been approved by the directors of one of the banks in Australia, despite the i>resent healthy business conditions in the Commonwealth. As it was. New Zealand was more or less acting like a man wno was spending the cash value of his life insurance policy which he had turned in. These remarks, said the speaker, were not meant as an attack on the present political party in power in New Zealand, but they indicated some of the reasons why business, in the midst of prosperity, was worried, and sounded warning signals. Businessmen did not as a rule run their concerns “on all cylinders” without making wise and adequate financial provision at the

same time for petrol to get them home again when their tanks ran dry. One responsible officer of an organisation of workers had hailed the present social insurance proposals of the Government because, ho said, the community, secure in the knowledge that its old ago was provided for, could go ahead and spend all its income. That was a meretricious argument.

On the other side of the picture, said Mr. Heany, businessmen had a duty to give leadership and to live up to the obligations which their position in the community placed on them. They, too, must exercise caution in regard to acceptance of the theory of • ’ priming the pump ’ ’ by great expenditures of public funds, and by State assistance and intervention. It they themselves acted rightly, and followed what was true, then it was for .them to let the people know the truth. As those to whom was entrusted the conduct of business, it was their duty to correct erroro of public opinion and to show the nation what the business world wero trying to do in their administration of industry and the direction of commerce, and to show that the profit, system was the best for the whole community.

In moving a vote of thanks, the chairman (Mr. A. J. Humphreys) said he could assure Mr. Heany that he had given members something to think about, and the address was very much appreciated. The motion was seconded by Mr. A. C. McCorkindale and carried by acclamation.