"A GRANDER DESTINY"

New Zealand Herald, Volume LXXII, Issue 22009, 16 January 1935, Page 13

"A GRANDER DESTINY"

Sir,—Would Mr. R. C. Simmons seriously contend that the destruction of perishable commodities, such as potatoes and fruit, when in^ unusual supply, that has occurred in New Zealand has prevented us from achieving a grand destiny? Or "will he deny that our wool, butter, cheese, meat, and the output of our factories —all our main staples in fact —have been sold and used almost to the last pound? Moreover, if, in ways trifling to the community as a whole, however serious to individuals, our production has exceeded our consumption the excess on the opposite side has been enormously greater. Has Mr. Simmons never seen houses in need of paint that cannot be kept in repair, or be replaced, without additional work being done ? Has he never seen the same deterioration through insufficient maintenance and replacement in our cars, our our machines and implements of all kinds; in the tools we work with, the furniture we rest on and the clothing we wear? In almost all directions the goods produced with our labour, in place of accumulating on our hands, are being consumed and worn away more rapidly than they are being' replaced or repaired. We are getting poorer in nearly all the elements of real wealth because we are not doiug enough productive work for the enormous consumption involved in our modern way of living and while that condition maintains any policy designed to increase our consumption in place of bringing us nearer to a grand destiny would merely bring us nearer to bankruptcy. I can agree with J. R. Wreaks that in the matter of costs whatever is paid by one party will be received by another, but our prices are, for the most part, fixed in Britain and we must adapt our costs to the prices that are thus obviously beyond our control. Moreover the cost!f ; that make up the price of a commodity may be very unfairly apportioned among the parties that* contribute to its production. The costs allowed as taxes, rents and wages may be so great as to leave nothing to our farmers and other producers, who may thus be driven out of production with disastrous effects on all parties. The so-called " credits "—paper money thinly disguised—the Douglas policy would present to consumers as discounts on the goods they purchased, in place of creating purchasing power, or anything else of value, would be as dishonest and mischievous as such frauds invariablv are. Gpods purchased should be paid 'for by the purchasers, not by the public, and whenever full payment is evaded, by any trick whatever, a swindle is worked. A grand destiny is not achieved by swindling. Bank credits, like all others, represent goods and services that have not been .paid for. Banks, at least to the extent of their deposits, act as agents between the depositors who supply the goods and the borrowers who receive them. The borrowers, having purchased goods with their loans., owe their price to the banks, and the banks owe it to the depositors who supplied the goods. This is banking in. a nutshell. I am not at present discussing the question, raised by Mr. G. Henry, whether our output is apportioned fairly, but the question whether a large portion of it is prevented from reaching any of our consumers at all by the faulty working of our financial system* Manurewa, J. Johnston**