THE New Zealand Herald AND DAILY SOUTHERN CROSS FRIDAY, APRIL 22, 1938 NOT ACCORDING TO PLAN

New Zealand Herald, Volume LXXV, Issue 23019, 22 April 1938, Page 8

THE New Zealand Herald AND DAILY SOUTHERN CROSS FRIDAY, APRIL 22, 1938 NOT ACCORDING TO PLAN

At the last general election the Labour Party made much of the fact that farmers' incomes fluctuated considerably from year to year. Mr. Nash pointed to cases where their production had increased but their income declined. Given a mandate to apply Labour's policy, however, he had a plan to iron out these fluctuations and give the farmers security, stability and certainty. Their income was to depend more on production and less on market vagaries. Sheep farmers may wonder what has happened to Mr. Nash's brave plan as they examine the season's wool cheque. In round figures it amounts to £9,000,000, against £15,000,000 the previous season. The drop is £6,000,000, or 40 per cent, although over a million more sheep were shorn. Here is the very position Mr. Nash so deeply deplored three years ago—production up and income down. To-day he and the Government are silent on the subject. There is no talk of any plan. Yet Mr. Nash declared in his well-known election pamphlet that "the responsibility is on the Government to see that the farmers' standard of living is not subject to such violent fluctuations." A broader aspect of the wool season will occur to many people. They have heard Mr. Savage and Mr. Nash trying to shore up the dubious financial foundations of the social security scheme on the assumption that production would increaed steadily. They have also noted the qualification of the British Government actuary, Mr. G. H. Maddex, that production must be related to demand, to markets and prices. The shrunken wool cheque offers an example. Progress is not as uniform and inevitable as the Prime Minister tried to suggest in his speech on Wednesday. In the case of wool, £6,000,000 has been lost at one stroke. The loss cannot be made up in any way. The Government is not interested; Mr. Nash has no plan. The sheepfarmers' purchasing power has been deeply cut. The six millions must also be subtracted from the national income that Mr. Savage imagines as every day and in every way getting larger and larger. Some of the loss may be made up out of dairy produce, but not all. Farmers from long experience had become inured to these vicissitudes, but the Labour Government promised to plan . something better. In this case it seems to be impotent. At the present time, also, facial eczema is taking heavy toll of flocks and even affecting herds. Here is another form of dead loss that no amount of State manipulation can make good. The sheep are dead or reduced to a fifth or a tenth of their value. This year's farming income has been seriously affected and next spring's lambing will suffer. No one would be so unreasonable as to cast up these losses at the Government, were it not for the limitless pretensions of Mr. Savage. At Wellington he spoke as if he and his Government were omniscient and all-powerful, able to create prosperity and prolong it indefinitely. Yet the planners cannot plan the weather and the vagaries of the season have brought widespread disease among the flocks. Where is that certainty and security Mr. Nash promised? The fact is the Government cannot guarantee the weather or the markets; it cannot guard against a general onset of disease or a severe shrinkage in wool cheques. With resUof us, it must bow to economic and natural forceß, • and at the present moment is doing so. When, therefore, the Prime Minister bases the security of the superannuation scheme on "inevitable increases in production" in the future, he is banking on factors known to be uncertain. He is committing the country to meet fixed charges out of an income that is not fixed. At Wellington he showed the large increase in national income that had occurred between widely separated years, leaving the impression that increment was certain and steady. But most people know that such is not the case. All adults will remember the steep fall in national income between 1929 and 1933 and many the sharp slump after the war. An older generation can remember the hungry eighties and unrelieved nineties following the spending boom of the seventies. Even the upturn at the beginning of the century was not uninterrupted. The slump of 1907-08 was brief but severe. Mr. Savage's rosy account of past progress must therefore be carefully qualified. Even if it were a safe guide to the future, recession would have to be allowed for. Unfortunately Mr. Savage will not use such ordinary prudence. He is building his social security scheme, and a great deal else, on a dream of prosperity in perpetuity. He ignores the unevenness of the economic way by which we have travelled in the past, the fluctuations of markets ancT the vagaries of seasons and he also ignores an entirely new factor; —the fundamental fact that our population is ageing and the number of productive workers beginning to decline. The people are not deceived, however. While Mr. Savage is promising to plane all the corrugations off life's road, they still find the going bumpy at times and hard pulling all the way. And, if the Labour Government were as clever as Mr. Savage implies, why is it failing the sheepfarmer here and now? Not because it lacks the will, but because it lacks the power. Nature and economics place inexorable limits on Labour Governments. Only their oratory is unlimited.