THE New Zealand Herald AND DAILY SOUTHERN CROSS. TUESDAY, SEPTEMBER 2, 1919. INDUSTRIES AND PRODUCTION

New Zealand Herald, Volume LVI, Issue 17254, 2 September 1919, Page 6

THE New Zealand Herald AND DAILY SOUTHERN CROSS. TUESDAY, SEPTEMBER 2, 1919. INDUSTRIES AND PRODUCTION

If any general criticism can be passed upon the very exhaustive and valuable report of the Industries Committee it is that the com- ! mittee shows too great a disposi- : tion to treat symptoms as well as diseases. The root of the economic evils from which New Zealand, in common with every other civilised country, is suffering, is underproduction. Th© committee recognises this fully, and it makes many original suggestions for stimulating all forms of industry. It does not appear to realise sufficiently that from this primary cause many secondary ailments spring which will disappear without special and | separate prescription when the prinI cipal disorder is cured. To take a simple Jlastration, the committee recommends that a Board of Industries and Commerce should have power to control prices. As a remedy for the abnormal conditions which have prevailed during the war, this proposal would be generally acceptable, but if it is intended to be a permanent part of our governmental system doubts will arise whether the resumption of free J competition will not render it un- | necessary. The high level of prices ! now ruling is due fundamentally to tan under-supply of commodities. [ There are contributing factors, but they are of less consequence than the actual shortage of merchandise of ever?' description. Even currency inflation is in some measure due to the scarcity of raw and manufactured goods. The printing ess cannot create wealth, and when notes are issued against materials destined for destruction on the i battlefield it is inevitable that money should become cheaper and commodities dearer. The world has been living beyond its resources, and it has played the spendthrift with its reserves of food, clothing, and manufactures. The present scale of prices is wholly artificial. It is the penalty for the waste of war. the outcome of the years during which the great nations have spent " money for that which is not broad," and ''labour for that which fiatisfieth not." Whenever there is a return to profitable expenditure and productive labour prices will begin to find the level which comj petition assigns to them, and the ; occasion for arbitrary control will . greatly diminish. It is instructive to notice how frequently in its survey of the industrial life of the Dominion the comj mittee is confronted with short ; supply and under-production due to .the destructive and di bint, -grating | influence of «.-„■. They afreet, every jlHi-i.-i'-- and .-v.-iy ,la-. ~f the com . munity. Tutvu and ~,„„, 1V suffer alike, from their paralysing grasp and the committee finds equal occasion to advocate the erection of houses and the importation of I fertilisers. Our communications | overseas are suffering from the

same cause and the same factors are operating to restore normal conditions. The sinking of millions of tons of shipping has inflated freights, but if industrial conditions are favourable between 4,000,000 and 5,000,000 tons will be launched within twelve months. The committee, therefore, showed discretion in recommending the Government to endeavour to secure reasonable rates for goods and passengers by negotiation before it threatens to compete against the shipping companies. It is possible that the increase in the world's tonnage, which is now in sight, may not bring the relief New Zealand importers and exporters are entitled to expect, but it can at least be surmised that an adequate supply of shipping will make the maintenance of high freights more difficult and the task of forcing them down more easy. The same thing is true in the fight against trusts and combines. Under- ; production is the ally of the monopolist ; abundant and unstinted production restore the competition he seeks to stifle.

The Industries Committee is at no time on safer ground than when it sets before the Dominion the ideal of greater production, and to its credit it must be said that it does this constantly. Immigration and the development of water power, so strongly favoured by the committee, are but means to this end, and the whole range of primary and secondary industries might be traversed without finding one which, under wise direction, is not callable of expansion. To increase their scope and to lay the foundation of new industries is to assure the prosperity of the Dominion. There is no other road to financial stability. It is not a royal* road; it may even seem commonplace and uninteresting, but it is the only safe course. Experiments in nationalisation may appear more inviting, but they should be measured by this eminently safe test, and none should be lightly entered upon unless it gives reasonable promise of swelling production. There are so many ways of spending public money profitably in New Zealand, so much has yet to be done to develop the natural resources of the country, and the war debt has made an expansion of the export trade so desirable, that public works of a remunerative character must be given first claim upon the Treasury. It is "hardly possible to spend too much upon them: it is* easily possible to spend too little.