UNSOUND FINANCE

Northland Age, Volume XVI, Issue 15, 19 November 1946, Page 4

UNSOUND FINANCE

Sir. —That the New Zealand pound note no longer buys what it formerly bought and that its value is still declining are facts notoriously patent to all of us. May I, as president of the League for Economic Democracy, be permitted most strongly to urge upon all electors that before giving their support to any flhulidate irrespective of party, they make sure that he is alert to the wide-spread evils resulting from unstable money, and that he is explicitly pledged to remedy the legislative defects from which they spring. Adequate protection can be secured only by inserting into our statute laws explicit instructions either to the Reserve Bank, or to a specially constituted monetary authority, to maintain the New Zealand pound note stable in its internal purchasing power over commodities. All other expedients, such as harassing price-controls, commodity-con-trols, guaranteed prices, subsidies to •producers and relief pay to unemployed, are merely palliatives ; ambulances- so to speak, at the bottom of the precipice when the real and vital need is a fence at the top. So long as currency and credit continue under the present system of control, or rather, lack of control without regard to keeping money and goods in step by maintaining a stable internal price level, so long will Neiv Zealand be afflicted by successions of booms and slumps, those in authority playing with the situation with makeshifts necessarily ineffective because they fail to reach the seat of the trouble. Now is the time to act. Now is the time to secure economic protection for our country, for ourselves and for our successors by electing a Parliament every member of which has given a decisively affirmative answer to the following question : “Will you demand and vote for a legislative instruction to the Reserve Bank, or to a specially constituted monetary authority, to employ all its power to maintain the New Zealand pound stable in its internal purchasing power?” Yours, etc., H. T. GIBSON.