THE FINANCIAL POSITION

Nelson Evening Mail, Volume LXIV, 31 May 1930, Page 8

THE FINANCIAL POSITION

ALTHOUGH the statement by the new; Prime Minister regarding the financial position of the country might appear on first reading to be very disquieting with its prediction of a shortage of three millions, we agree with Mr Forbes's expression of confidence that "tho position can be met and tho Budget balanced as, of course it must be, • without any serious hardship, for the general financial position of the dominion as a whole is quite-sound and courage, determination, and a capacity for hard work are typical characteristics of the New Zealander." More points stressed by the Prime Minister in his frank statement are worth repeating. For instance he talked commonsense when he said r "In the immediate present, however, it must be recognised that we have got to cut out coat according to our cloth, both privately and nationally and review our expenditure with the object of temporarily eliminating or curtailing such items as can be most easily dispensed with ... In other words, wo have got to determine what is essential and what is not, and for this year at any rate, eliminate or at least severely curtail the non-essential." •We regret, however, that the Prime Minister hints at the possibility of extra taxation when the country is already groaning under this load —a burden that has hampered industry and assisted to increase unemployment. He declares that reductions in expenditure are the only alternative to heavy . increases in taxation, and, in the interests of the country must be made accordingly. But in the concluding portion of his announcement he states it as probable that after all feasible economies are made, "some additional taxation will be unavoidable." All leading students of ecoand prominent business men have agreed that to increase the taxation burden—although to do so seems so simple—would inevitably increase the country's difficulties. We do not propose to attempt to' deal with the Prime Minister's statement in detail -at this juncture except to emphasise that economy lather than added taxation is essential. We agree with Mr Forbes, who is to be congratulated upon frankly and promptly facing an unpleasant situation so soon after taking office, that all sections of Urn community should quietly and resolutely face the hard facts and accord to the Government support and cooperation in order that the economic life of the people may suffer as little as possible. It is satisfactory to note fiom the typically outspoken announcement of Mr Forbes, that although great care is necessary, the Government will not hesitate to provide the capital that is considered essential for the economic development of the country. In this

category, we have no doubt, the completion of the Nelson-West Coast railway is included.