NEW ZEALAND'S POSITION

New Zealand Herald, Volume LXX, Issue 21579, 25 August 1933, Page 15

NEW ZEALAND'S POSITION

oir, —in place or dreaming or whirling wonders in America that have never been used, and fabulous increases in output that have never eventuated, it might be profitable to investigate the sober facts of our own position. The latest official estimates show that the volume of our output per head fell by 21.3 per cent, between 1000-01 and 1016-17, increased by 29.4 per cent between 1016-17 and 1920-30, and again fell by 10.3 per cent, between 1929-30 and 1932. Over the whole period, 1901 to 1932, was a fall of A.7 |>er cent . The exchange value of our exports is determined chiefly by the prices of Britain's exports that form our imports, and of her imports that form our exports. G. P. H. Cole, reader in economics, Oxford University, in his "Intelligent Man's Guide Through World Chaos," page 195, states that in 1931 Britain's export prices were 40 per cent above the pre-war level, while her import prices were 5 per cent below it. The Macmillan report, paragraphs 100 and 264, gives figures showing export, as compared with import prices, to have risen by 01 per cent between 1913 and 1931. While price levels were thus changing so greatly to the advantage of Britain and disadvantage of New Zealand our external debt increased by over £100,000,000. How have these great changes affected us? Our exports, now selling at prices 21.2 per cent below the 1914 level (July Abstract estimate) would, at 1914 prices, realise £8,470,000 additional. Our imports, purchased at prices 9.4 per cent above pre-war (July estimate, with exchange and sales tax deducted) at 1914 prices would cost us £2,079,000 less. We are losing £1,500.000 through the fall in our output per head, and £5,000,000 in interest on the addition to our external debt. Thus, in place of a fabulous increase, we are, in real wealth, €17.000,000 a year poorer than we would have been 'if we had retained our 1914 output and trading conditions. But what of the niggardly spending, said to be the real cause' of our depression-' No one not blinded with delusions will deny that the motor vehicle has increased our transport costs since 1914 to an extent that is almost beyond computation. Nor can it be denied that we now spend vastly more on places of amusement, houses and furniture, even on fond and clothing Wanes are 36.8 per cent and land costs -">0 per cent above pre-war, while taxation per head in 1932 was 134 per cent higher. Thus, while our returns have fallen disastrously, our costs have risen enormously, and our rate of spending, both private and public, is ruinously beyond our diminished means. J* Johnstone. Manure wa.