THE ROOSEVELT PLAN

New Zealand Herald, Volume LXXI, Issue 21764, 2 April 1934, Page 12

THE ROOSEVELT PLAN

Sir,—l regret to say that- I am tinable to accept. Mr. Blood worth's presentment of the developments in America in the early stages cf the depression. The obvious nse and purpose of equipment is to secure increased output- with a given amount of human effort. ]f as the result of strong appeals Americans greatly improved their equipment, on a nation-wide scale their output should have increased, whereas in actual fact it. fell disastrously. It is true that machines,do not buy goods, but they are enormous consumers of fuvls and a vast variety of materials used in their construction and maintenance. Consumption is thus vastly increased by the use of machines, the consumption of the machines being added to that, of human beings. Moreover, the output of useful goods is increased and all such goods are purchasing power. Our purchasing power is always simply this—we possess something for which others are prepared to give us .something. It purely ft matter of production on the part of both parties to the exchange, and thus, through increased use of machinery, the purchasing power of mankind and the purchases actually made, are now incalculably greater than those of -00 years ago. ('an Mr. Bloodworth tell us what would happen to our purchasing power if wp reverted to the methods of the stone age? Mr. Bloodworth asserts that prior to the adoption of the Roosevelt plan production increased, while consumption fell, and as the result of these, tendencies —general. apparently, throughout the world —goods accumulated and we are "simply smothered in plenty.'' Tie gives us no evidence, however, and facts aro against him. fn place of going up, production went down disastrously, and I challenge him to prove otherwise in place of wealth accumulating practically everv family now has less wealth than in 1929, stocks are lighter, goods in transit are tragically less, and men, hard pressed by the depression, are everywhere allowing their equipment to run down. All this means that in nlace of consumption being inadequate, it has in recent years been far greater" than production. The exeat changes in price levels left us with production i - eturn3 at about the 1913 level and costs enormously higher. This made the employment of labour and capital unprofitable, hence unemployment, the niling up of fixed deposits and the falls inproduction and purchasing, power. All this seems nlaiii enough to eyes not blinded with prejudice. J. Johnstone.