NOTES AND COMMENTS.

New Zealand Herald, Volume LXVII, Issue 20713, 5 November 1930, Page 10

NOTES AND COMMENTS.

THE MELBOURNE AGREEMENT. The origin of what is known as the Melbourne agreement for the rehabilitation of Australian finances was explained last week by the Sydney Morning Herald. " The States were the instigators of the agreement," it says. "At the end of the first day of the Melbourne Conference in August the States, facing an obstinate Federal Ministry, agreed unanimously that the Commonwealth must bo brought to agree to the same course of necessary economy as themselves. They resolved unitedly to demand that tho Federal Government should balance its Budget, as tho States must, by reducing expenditure, and that any attempt by the Commonwealth to increase taxation, would make every State's task impossible, for they would have no reliable source of revenue left. Every State, it was protested, was reducing Ministers', members', and Public Service salaries. ' Why should we have to do this,' demanded the South Australian Labour Premier, ' while the Commonwealth Parliament and services go free ?' Before the united representations of the States and the grave warnings of the Commonwealth Bank, the Federal Ministers, Messrs. Fenton and Lyons, consented to the resolutions, and they took Sir Robert Gibson'to a special Cabinet to persuade Mr. Scullin also of the necessity. Thus the Melbourne agreement came about. Tho reasons are as clear to-day as they were then why the Federal Treasurer cannot increase direct taxation without making the task of each State impossible." OVER PRODUCTION. "Since the war primary production has been responsive to the stimulus of successful research, improved methods, and the famine prices that ruled for a short time. Hie result has been supplies in excess of demand, because the readjustment of the processes by which raw material is converted into the form in which it is available for consumption has not gone hand in hand with it," says the Times Trade Supplement. "Under modern conditions the item of cost of material plays only a relatively small part in the fixation of tho price of finished articles, while other factors, such as transport charges, wages, factory upkeep, and digtribution costs, have been strongly resistant to change, and higher taxation has tended to increase the prices of the final products of industry. The net result is a want of relativity between tho prices of raw materials and those of finished articles which curtails consumption, or, in other words, creates trade depression. The tendency of the highly complex modern system to press with undue hardship on the primary producer is a very serious matter . . . Organised J&bour has secured terms and conditions that soeni to ensure its welfare, but if, as a result, the cost of finished goods is out of proportion to the primary producer's capacity to pui chase, stagnation of trade is inevitable and in tho long run all classes suffer ; but few people recognise that the logical outcome of a lopsided position of this kind is to depress the conditions of life for all and to create a largo permanent body of men and women in all sections whose labour will bo redundant until a more equitable arrangement increases the ilow and oxchange of commodities."

AVIATION IN CANADA. ■The value of the aeroplane in those parts of Canada at present unserved by roads and railways, and for the protection of forests from insect pests, is indicated in the report on civil aviation for 1929 issued by the Dominion Government. Three-quarters of the area of Canada is still remote from lines of communication ; but with the aid of aircraft the exploration and development of this area ''have been proceeding with great rapidity," and "the romotest corners of Continental Canada have been brought within easy roach of civilisation. Millions of acres of our remote forest .areas, hitherto unprotected because of their inaccessibility, are now efficiently patrollod. Their extent and value havo been determined. Adequate maps, the first essentials of any development, can now bo mado with a speed and accuracy undreamt of before the advent of the aeroplane . . . The year lias witnessed a great advance in aerial activity in all parts of tho Dominion, forest protection and survey work havo been continued on a larger scale than ever before. Flying in the Far North has become an essential part of our transportation system. Air mail services already span half the continent. In the east the trunk lines now run daily from St. John to Quebec, Montreal, Toronto, Windsor, and .Detroit; in tho west the planes span the prairies every night." Forest protection consists partly of fire patrols and partly of the extermination of pests by seaplanes operating from tho lakes. The destruction of insects was carried out bv a three-engined machine which flow lowover the infested forest areas, scattering a poisonous dust. Striking results are reported. In one case 95 per cent, of the caterpillars were killed at a total cost of about 25s an aero. This, the report says, will bo "a profitable investment if the operation results in checking a small outbreak and prevents its extension ove* a large and valuable forest," and suggests that the most useful field of forestdusting will be in the control of the initial ■j'-ages of insect outbreak*.