‘Competition For Men tees Costs’

Northern Advocate, 17 March 1948, Page 6

‘Competition For Men tees Costs’

DUNEDIN, Wed. (Sp.).—“The extent to which some employers are contributing to the wage and price spiral by competing one with the other, and paying and offering inducements to workers to seek new places of employment, gives me no little concern,” said the president of the Associated Chambers of Commerce (Mr Haskell Anderson, of Wellington) when addressing the annual conference of the chambers last night. of our people today are playing with capitalism and socialism at the same time,” said Mr Anderson. “This is destroying the whole wage structure which has been biult up. H our employers are to continue to follow this practice, they must accept the responsibility for a subsequent breakdown of the industrial conciliation and arbitration system. CAUSING INFLATION "This competition is causing inflation and has contributed to the rising cost of goods. "The Price Tribunal allows increased costs and these are passed on to the buying public.” Dealing with taxation, Mr Anderson said the Government had defended its heavy taxing programme with the argument that, by withdrawing through taxes part of the people’s income which exceeded the total goods available, it held down inflation. Since goods, and not money, were the real measure of wealth and living standards, that argument had some superficial merit, but the paradox was that high taxes meant high prices which, taken together with increases in the wage scale, actually aggravated inflation. Secondly, where high taxation curtailed production, it defeated its own ends and that defeat was occurring because the net return for extra work after taxes was not worth the risk, worry and effort, Mr Anderson continued. CONSUMER DEMAND In the third place, while the Government maintained so-called antiinflation taxes with the one hand, it speeded inflation with the other hand by stimulating consumer demand with profligate state expenditure. The Government taxed heavily, but put back into circulation practically the whole of the Consolidated Fund taxation, also social security funds, war expenses funds, Post Office Savings Banks funds, “tap” loan money, and money raised through the Reserve Bank for state housing purposes. “Many millions of existing and new money have been injected and reinjected into circulation without a corresponding increase in production to equate this excess money,” said Mr Anderson. CUT TAXES . “If that is not inflation, I do not know what it is. To check the wage and price spiral, to stimulate production and to increase the purchasing power of the pound note, the Government must stop playing Santa Claus, cut taxes and allow people to spend arid invest their own money in their own way.” Mr Anderson said the whole fault of scarcity and then congestion of goods was due to the import control system, which was still in the rigid grip of a Minister of the Crown “in absentia,” and which was responsible for interfering with the steady, free flow of goods and their even distribution to meet the requirements of the people.