NATIONAL ECONOMY.

New Zealand Herald, Volume LXVIII, Issue 20969, 4 September 1931, Page 8

NATIONAL ECONOMY.

The appointment of a committee representative of all parties, to which the Government agreed a fortnight ago, was universally accepted as evidence of an earnest determination to deal promptly and effectively with a situation which until then had not been squarely faced. In respect of both method and resolution, the proceedings of the committee have been disappointing. The task allotted to the committee was "to decide what remedial steps should be taken to adjust the national expenditure and to provide for equality of sacrifice and the proper distribution of the burden." That definition presumed a programme for the restoration of the public finances to equilibrium on the basis of economy in public expenditure—an objective exactly similar to that set before the temporary Coalition Government in Britain. Instead of concentrating its attention on the central issue, and inviting expert advice and assistance only on the various aspects of public finance, the committee has allowed its inquiries to be extended into all sorts of extraneous subjects, and has already gathered a mass of testimony more or less irrelevant to its real task. -It has apparently been misled by a vague conception of a comprehensive plan for the general economic rehabilitation of the Dominion, forgetting that the first step in that process must be the correction of the disorder in the public finances and that general rehabilitation depends on many fac-

tors, and agencies that are beyond* the control of Government and Parliament. There are limited opportunities for their contribution to the rehabilitation of private affairs; but any attempt to apply comprehensive remedies by legislative compulsion involves the risk of creating chaos. Previous experience of such experiments in the regulation of economic conditions does not inspire unqualified confidence in the discretion of Parliament either to confine its measures to ascertained needs or to withdraw them immediately their salutary purpose has been .effected. There is consequently a danger that, by attempting too much, the committee will presently discover that it has accomplished nothing of practical value and will be forced to start again upon the financial problems which must be solved before the process of recovery can begin. The fundamental responsibility imposed upon the committee is to reduce public expenditure and national taxation to a minimum. All its efforts should he concentrated upon that task until positive conclusions have been reached and endorsed by Parliament. When that has been done, it will be time enough to consider whether the present committee or the present Parliament can profitably address themselves to other national problems.