ECONOMIC AND SOCIAL

Otago Daily Times, Issue 21598, 19 March 1932, Page 4

ECONOMIC AND SOCIAL

SIR NORMAN ANGELL ON “ UNSEEN ASSASSINS ”

" The Unseen Assassins.” By Norman Angell. London: Hamlsh Hamilton (7s 6d net.) “ New Zealand In Tho Crisis.” By D. B. Copland, M.A., D.Sc. Christchurch: Whitcome and Tombs (6d net).

“ The Crisis In New Zealand and the Problem of Reconstruction.” By H. Belshaw, M.A., Ph.D., D. 0. Williams, M.A., L. W Holt, M.Com., H. R. Rodwell, M.A., and E. B. Stephens, M.A. Wellington: N.Z. Dairy Exporter.

Mankind, Sir Norman Angell suggests, is possessed of common sense which it does not always employ in the solution of international difficulties: —

We do not desire to create social or economic evils to impose injustice and bring about w'ar, but we apply policies in which those results are inherent because we fail to see the implication of the policies. Those imperceiyed implications are the Unseen Assassins of our peace and welfare. The plain citizen, though he does not want anarchy in his country, Sir Norman Angell asserts, insists upon its continuance in international affairs, and public opinion, not governments, is responsible for war: “Again and again this last ten years we have seen governments desiring to do one thing, knowing that it is the best thing to do, and prevented by popular feeling from doing it.” The proposition that passion, fear, or hate must always act upon one particular interpretation of the facts is, he holds, in itself a disregard of knowledge which is at everyone's disposal. It is necessary that government should be carried on by laymen who take advantage of the advice of experts—that there should be evolved a new technique of expert interpretation. Economic struggle and competition are themselves, he says, with their menace of disintegration and war, the outcome of a habit of thought which insists that the nation is different for economic purposes from other political, racial, or economic divisions, whereas if “an Argentinian sells corned beef to Germany and with the money so obtained buys cutlery in Sheffield, the money so produced being used to import petrol from America, the shareholder in the oil stock so benefited buying a dress in Paris,” the national entity scarcely enters into the transactions. In many instances, therefore, to speak of Germany’s or Russia's trade is, he contends. to talk nonsense.

Sir Norman Angell regards the Nationalist Movement in Europe, the demands for Dominion status within the Empire, the ever-increasing tariff barriers, as steps towards disintegration. The remedy for “ Imperialisation ” is “ not. nationalism, which threatens to Balkanese the world, but internationalism, which, be it noted, is not the denial of nationalism, but its orderly organisation, the limitation of national rights in the same way that in any civilised society the fight of the individual must be made subject to the general interest in order that the individual can live at all.” Dr Copland on Exchange

In “New Zealand in the Crisis,” Dr Copland deals. principally with the exchange difficulties that are being exEerienced in the Dominion, and develops is argument that a middle course between deflation and inflation offers the best solution. With a falling national income, he says, the traditional methods of economy and higher taxation are inadequate to balance the Budget—New Zealand faces the prospect of a deficiency this year and possibly a larger in 193233. But “if money value of the national income can be sustained revenue will also be held up and a much greater contribution towards Budget balancing can be made through ordinary economies.” He answers the question, “How can the deficits be financed? ”> as follows: i

The most satisfactory course is to secure Treasury Bills from the banka against which, if necessary, notes can be issued. Provided the Budget position is being handled firmly and there is a good prospect of the Budget being balanced in a time, this method of financing deficits is inherently sound. It increases the cash reserves of the banks and enables them to sustain a sufficient volume of credit to tide the country over its difficulties. _ By sustaining the price level the higher exchange rate keeps up the value of securities against which advances have been made, and thus makes bank assets more liquid. It is true that the National Debt is increased, but this must happen in any case. The real burden of the new debt created, and of the existing debt, will be less if the internal price level is kept up through the exchange rate than if drastic deflation is pursued. This booklet, which is reprinted from a series of articles contributed to a Christchurch contemporary, is offered as “ a basis of discussion.”

A Plan for New Zealand Another interesting contribution to economic thought in this period of travail is made by Professor Belshaw, a member of the Committee of Economists appointed by the Government, and four other prominent New Zealand economists. It is entitled “The Crisis in New Zealand,” and offers a definite plan for the reconstruction of the economic life in the Dominion so as to produce a balanced Budget in 1933-34. The primary objective of any plan, it is urged, mufet be to bring farming costs Into line with the prices for farm products, for which purpose a combination of costs deflation and an increase in money receipts through the raising of the exchange is advocated. The writers approve of a 20 per cent, reduction in fixed charges, and a total reduction of 20 per cent, in wages and salaries, as necessary to the fulfilment of their plan, and suggest that the remaining deficit should be met, not by increased taxation, but by the issue of Treasury bills or by other forms of internal borrow- . ing. M‘G.