EXCHANGE RATES

New Zealand Herald, Volume LXIX, Issue 21346, 22 November 1932, Page 12

EXCHANGE RATES

Sir, —Some time ago ;i self-appointed Exchange Committee (including a retiring Minister of the Crown) supposed to be working _in farmers' interests, set itself to induce Government to institute higher exchange. The banks opposed this, and the Exchange Committee faded away, letters requesting information remaining unanswered. Then Ottawa Conference cams to certain decisions which will mean re duced protective duties. It is now being freely stated that the hanks are prepared to agree to a high exchange, provided that any central banking legislation put through accords with their wishes. An agrarian Parliamentary "bloc',' is said to he pressing for pegged high exchange. It is open to question whether this " bloc "

is not formed to assist or excuse Government in doing what it desires to do. High "exchange may not only cancel reduced duties later on, but, with selection of the duties, choosing those that arf- not protective, may qu'te easily result in great increases of costs. All the possibilities and ramifications of high exchange with tariff . manipulations cannot be dealt with in this letter. The scheme is insidious. V hat matters is that. it. will fail as other stunts have failed, and as the same combination has failed most dismally in Australia, to relieve unemployment and facilitate production for export. The public will, in tho long run, juage by results and a long course of being fooled may have dangerous effects on the public's temper. In conclusion, may I ask why, if a pegged exchange is so desirable for farming, the Farmers' Union has hitherto resolutely refused to adopt it as a policy? Farming opinion has been misrepresented. No doubt propaganda will in time have its intended effect, but the fact is that up J?. 14 the, present farming opinion on the subject, expressed by resolutions, has_ ; favoured a free exchange. A. E. Robinson. Provincial Secretary, N.Z. Farmers Union.