THE OTAGO DAILY TIMES WEDNESDAY, SEPTEMBER 10, 1919. THE COAL-MINING INDUSTRY.

Otago Daily Times, Issue 17726, 10 September 1919, Page 4

THE OTAGO DAILY TIMES WEDNESDAY, SEPTEMBER 10, 1919. THE COAL-MINING INDUSTRY.

A combination of causes has operated in tho past few weeks to bring tho proposal for the nationalisation of tho coalmines of this country definitely within the domain of what are called practical politics. The recommendation of Mr Justice Sankey in favour of tho nationalisation of the coal-mining industry in tho United Kingdom and the agitation in support of this recommendation have not been without their influence in New Zealand. Their effect was revealed, indeed, in tho claim which was put forward by representatives of the New Zealand Labour Alliance, who. waited on tho Government after tho abortivo conferences last month between the Coal Owners' Association and the Miners' Federation: It is in support, moreover, of that claim that the community is being treated at tho present time to an experienco of a deliberate restriction of tho output of coal. Tho object of tho tactics now being employed by tho coal-miners is transparent enough. It ig to make the cost of production of coal so heavy as to force tho price of tho commodity up to an intolerable figure and at the samo time to induce in the public mind a feeling that tho nationalisation of tho mines would furnish a relief from tho serious inconveniences that aro being imposed

on the dominion under existing conditions. Highly significant, at this juncture, are the acceptance bj' Sir Joseph Ward, on . behalf of the Liberal Party, of the principle of the { nationalisation of the mines, and the acceptance of this principle also by the Industries Committee of the House of Representatives, composed of eleven members of various shades of political ; opinion. Neither Sir Joseph Ward i nor the Industries Committee advances any convincing reason for the policy to ' which they have committed themselves. ■ ; Sir Joseph Ward expresses the opinion that nationalisation of the coal industry represents the only offectiv© way in i which coal can be produced in sufficient quantities and at lower prices for consumers. The Industries Committee apparently bayas the conclusion at which it arrived on the ground that tho prosent system of ownership is conducive to waste. "It was," the committee reports, "stated , by a reliable witness that over a big E proportion of one important mine 75 per ( cent, of the available coal is wasted ; owing to its not being workable at a • profit. It is therefore certain that ' large quantities of coal are now lost, and that by central control much of this loss would be prevented; and this end, , in the committee's opinion, can onlv be 1 attained by complete nationalisation of \ the coal-measures." There is an obvi- : ous lack of relation between the evi-. ; donee upon which tho committee relied . and the conclusion which the committee adopted, but wo do not pause to question the logic employed in the report. . It is to bo observed, however, that the •view taken by the committee, that there is a considerable waste of coal under the existing methods of working, ; was that expressed by Mr Semplo in his maiden speech m the Lower House last week. Despite certain characteristic extravagances. Mr Semple seems to have spoken with greater restraint than usual, and it is probable that, just on this account, he will hsve made a better impression than would have been the case if he had torn a passion to tatters in the manner affected by the industrial and political extremists , . Mr Semple asserted that "in tho hunt for dJVidends" vast quantities of coal were ' lost bscauso a mine had to be closed lonobefore it was exhausted. It is not ■ made clear to us how the mining of coal . that is "not workable at a profit" under private enterprise is going to be profitably undertaken under a system of State ownership. The conclusion is irresistible that there will be a loss in the production of this coal by the State and that this loss will niinply have to bo a charge upon the Consolidated Revenue and to be met out of the proceeds of taxation. In other words, tho public money will be ■ taken out of one pocket, in order to be placed in another. If, as Sir Joseph Ward suggests, the . output of coal can be increased and the prico to the public can bo reduced under a sys-tem of nationalisation, it can only be because, as Mr Semple argues, State management is more efficient than private management. Mr Senile's contention is that faulty methods of extraction are practised in mines which are tho property of coTip-nies—thut they ■ are necessarily practised because a manager is expected to produce dividends for the company that employs him—and that under State control the i manager could bo instructed to extract ■ coal on scientific lir?ep. Tho assumption that State management is certain, or I .even likely, to be more efficient than management under private enterprise is one, however, which experience of State

control has not shown to be justified. It is negatived, moreover, by the circumstanco that the nationalisation of an industry, which moans tho centralisation of control of an industry, assuredly will involve tho stifling of incentive and freedom of action on tho part of the managers. Tho objection which exists on this ground alone to the proposal for nation- i alisation was emphasised in tho report' of a German Commission on tho Socialisation of Coal Mines. "The overburdening of highly trained officials with petty duties, tho objectless changes of posts, the poor salaries—almost ridiculously small as compared with these in private industries—the restrictions ou freedom of action, the lack of confidence reposed in those financially responsible, the complicated system of grades, tho protracted discussion of matters which could be settled in a few hours—in a word, control on the top of control instead of personal responsibility and an incentive to initiative"—these were tho characteristics of the Prussian State ownership of coal-mines, and we cannot honestly hold, in the light of our knowledge of the bureaucratic man- i ner in which State departments in the dominion are conducted, that these would not be tho characteristics of State ownership of the coal-mines of New Zealand. To tell us that there will bo | a greater output, associated with re- j dueed prices, under State management is to ask us to believe what is not readily credible. And to point, as Mr Semplo does, to the conditions of the housing of miners-—conditions of the sordidness of which tho Board of Trade has instructed a public that was not previously awaro of their existence—as an illustration of tho need of Stato ownership

is to suggest what is ccrtainly unreasonable, namely, that it is only under a change of ownership of the mines that an improvement in the mining camps is possible. There is, indeed, no argument in favour of the nationalisation of the coal-mines that can be soundly based, as far as wo can see, on industrial and economic considerations. It is impossible, moreover, to disregard the fact that the agitation in favour of the nationalisation cf the coal-mines is, in Now Zealand as well as in the United Kingdom, to a large extent political in its character. But the nationalisation of the coal-mines would bo only the thin end of tho wedge which, driven home, would be productive of the nationalisation of ono industry after the other. Tho effect would be that, as Lord Inchcapo has described it, " bureaucratic inertia " would he installed in the place of tho personal incentive which has built tip British trade in the past. It is plain, moreover, that if the coal-mines of the country should bo nationalised and if State control should be established ovor several other activities, as is proposed by Sir Joseph Ward, we should bring into existence a body of public servants in the dominion so numerous and powerful that their political influence, if exorcised unitedly, would be almost overwhelmingly great. Already meral>ers of Parliament and Ministers of the Crown find it difficult to resist the pressure exerted on them by the public service. Tho prospect of a Government absolutely controlled by a swollen public service is scarcelv cnticinw.