NOTES AND COMMENTS.

New Zealand Herald, Volume LXIX, Issue 21087, 22 January 1932, Page 8

NOTES AND COMMENTS.

NEW SOUTH WALES FINANCES. Expenditure £8,279,763 in excess of receipts was disclosed by the accounts of tho New South Wales Government for the firsC half of tho financial year, to December 31. This was almost equal to tho deficit of £8,305,596 forecast by Mr. Lang in his Budget last August, the latter sum including £1,672.722 of interest not paid by the State during the period of repudiation. Mr. Lang has promised the Loan Council that he would undertake further economies which would reduce the deficit by tho end of the year to £5,410,000, but, reviewing the situation, the Sydney Morning Herald concludes that this cannot be accomplished, oven if revenue from taxation conies up to expectations. " The Government's financial position is desperate," it remarked. " Industry in this State is dying under Trades Hall oppression, and there is not unlimited time to save it. Employers of every industry will soon have to appeal to tho Governor or to the Commonwealth Parliament, or to both, to save them from a drift which must end soolier or later in collapse. The Lang Government is not carrying out the Melbourne rehabilitation agreement, as it undertook to do in return for credits from the Loan Council; and, in our opinion, it has not the slightest intention of carrying it out while it can avoid doing so. Its masters at tho Trades Hall have condemned the agreement, and excommunicated Labour Ministers in other Governments who have accepted it. The Loan Council cannot meet too soon to review performances of undertakings by all Governments. Its particular duty will bo to scrutinise Mr. Lang's financial behaviour, and the prospect that Mr. Bruce may preside over the Loan Council is a guarantee that Mr. Lang's past duping of that body will not bo continued." IMPERIAL CO-OPERATION. Addressing the Royal Empire Society upon tho economic policy of the Empire, Sir Edward Grigg, formerly Governor of Kenya Colony, said the future of Britain and of tho Dominions would depend upon trade and migration, and both were closely related. Industry in Britain, however much it, revived, would find difficulty in absorbing tho annual increase in population. For the time being the Dominions, owing to the economic crisis, were unable to absorb new population; but it was quite obvious that their vast latent resources could not be developed without immigration on a large scale. As a first principle each country should aim at the balance of export and import best suited to its own development. It would be idle for any country to attempt to force some line of production in which, at any rate after a limited period, it could not compete effectively with tho world price. It would be equajly wrong for any country to deny itself for the sake of Imperial co-operation some line of production in which it could effectively supply its own market at something not entirely out of keeping with the world price. They needed steady and natural, not hothouse, development. On the last figures which lie had been given, the Empire oversea imported British goods to the yearly value of £270.000,000, and non-British manufactured goods which Britain could produce to the yearly value of £280,000,000. No doubt, 'the Empire oversea would manufacture part of that great volume of imports for itself; but the Empire, if assisted by Britain in developing the industries best, suited to each part, would provide an ever-increasing market for manufactured goods which Britain produced—assuming that, in return for assistance to natural industries oversea, tho Empire studied British interests, too, and, where it reasonably could, gave favourable entrance to British products. THEORY AND PRACTICE. The necessity for caution in undertaking experiments in monetary affairs was emphasised by Sir Josiah Stamp, a director of the Bank of England, in a lecture at Manchester University. He said economists and others in a position of freedom and no responsibility could work out problems without practical risks. They could spin their theories and say what the practical man ought to do. but they tended to lose sight of an important consideration when they became indignant, that, immediate trial was not made for all tho obvious improvements that were so clear to them. The practical man had to woik, so to speak, upon a "book of rules." It had the advantage that it had worked in tho past and that its conventions wore generally understood. The book of rules had depended for success on its mechanical suitability to conditions and to tho psychology attaching to it. It was possible to adopt a new book, but the practical man was entitled to expect:— (1) That the modification of circumstances was permanent enough to demand it; (2) that competent theorists and thinkers wore agreed upon tho new "book of rules" as being the one most likely of success; and (3) that national and now international credit psychology was ready to accept the implications of the. new book. Merely, in advance of public understanding, to pickout odd rules from the new book and superimpose them upon tho old, might not give either the old or new a proper chance of success, and might indeed be dangerous. For one to adopt even tho whole new book while all others were using the old was equally risky. He counted it no shame to any man to bo a double personality—conservative and cautious in the dischargo of his practical responsibilities as a banker or a statesman, while fearless and adventurous in his thinking as an economist and citizen.