MR. SAVAGE'S PESSIMISM

New Zealand Herald, Volume LXXVI, Issue 23339, 6 May 1939, Page 12

MR. SAVAGE'S PESSIMISM

Many hardworking, decent people whose livelihood is threatened by the operation of the Government's import restrictions will seek for some grain of comfort or reassurance in the Prime Minister's reply to the deputation of clothing retailers. They may find it difficult to follow Mr. Savage in his amiable ramblings, but the effect should be clear, if not at- all encouraging. The shopkeepers are informed that there is nothing else for it but that they must go short in the meanwhile. Their stocks, and therefore their business and employees, may be affected, but Mr. Savage can offer no present alternative, although he is full of hopes for a rosy future. In ruling out several possible courses, the Prime Minister says first and most emphatically that he will not reduce waged. Robust as this may sound, the worker and his wife know that, while money wages are being maintained, real wages are falling daily by the rise in prices and the reduction of purchasing power. The fall is being hastened by the scarcities created by the Government's own restrictions. Worse than that, the Government may keep up nominal wages but does not guarantee jobs at the award rate, with the result that many are becoming unemployed because in many shops and warehouses the reduced business cannot foot the old wages bill. Another coui*se dismissed by Mr. Savage is borrowing. He declines to raise a loan to tide over present difficulties, although that would save much immediate hardship. If, however, private persons have a long enough purse and can raise the wind overseas they are at liberty to do so, while .the small man goes to the wall, however honest and necessary his trade may be. Mr. Savage also rules out any possibility of a solution "by manipulating currency in New Zealand." While many will agree that this ruling is sound, others will wistfully recall that the Prime Minister used to pretend that miracles could be performed by monetary manipulation. Now that the test has come, he denies his own proposition and informs the retailers that there is nothing for it but to go short for the present.