THE OTAGO DAILY TIMES FRIDAY, AUGUST 1, 1924. THE ACCUMULATED SURPLUSES.

Otago Daily Times, Issue 19239, 1 August 1924, Page 6

THE OTAGO DAILY TIMES FRIDAY, AUGUST 1, 1924. THE ACCUMULATED SURPLUSES.

Thk-thoughtful speech which Mr F. J. Rolleston delivered on Wednesday will rank as the most valuable contribution offered by a private member to the discussion in tho Budget debate of the financial problems of the country. Mr llollestou said that he spoke from a non-partisan standpoint. It may be suggested, therefore, that although he is nominally a member of the Reform Party, actually he occupies a position of political independence. Tho views which he expressed on this occasion Would not be accepted in their entirety by any one of the three parties in Parliament, but they are obviously the outcome of an earnest study of economic laws and tendencies. Even though we cannot accept some of the principal conclusions which have been formed by Mr Rolleston, wo must acknowledge the clarity of the presentation of opinions that are not generally entertained. Mr Rolleston holds strongly that the whole of the accumulated surpluses, totalling nearly twenty-seven millions, should have been applied to the redemption oi war loans. That is a perfectly intelligible view, but we are unable to follow Mr Rolleston in the expression by him of the belief that if this course had been adopted there would have been no land boom and no farmers’ troubles, and there would have been no soldier settlement troubles with the estimated loss of millions. The inference which is to be drawn from this statement is that the policy of tho Government in purchasing land in large quantities for repatriation purposes was prompted by the possession of the accumulated surpluses. This does not, however, seem to us to

be at all justified. There was an insistent demand all over the country for the settlement of returned soldiers on the land. The public perspective was distorted at the time through the contemplation of the extraordinary prices that were being realised for the primary products of the country. People did not pause to reflect that these prices could not, in the very nature of things, be permanently secured. The Government simply could not resist the demand for the settlement of tho soldiers on the land. Whatever was done with the accumulated surpluses, that demand had to be satisfied. It is impossible for ns, therefore, to suppose that the employment of tho accumulated surpluses in discharging war indebtedness would have enabled the country to escape the effects of the injudicious purchase ol blocks of land for soldier settlement at inflated values. Mr Rolleston’s argument, however, in favour of a policy ol getting rid of the war indebtedness as practicable is reinforced by the consideration that the effect of the process of deflation is to increase tho value in purchasing power of the moneys that were borrowed by the State. Even it. this were not a consideration of high importance the existence of a public debt of the magnitude which this small country has now to bear is a matter ol serious moment, plainly checking developments that are necessary' in the public interest.