THE ECONOMIC SITUATION

Otago Daily Times, Issue 21994, 1 July 1933, Page 5

THE ECONOMIC SITUATION

TO THE EDITOR.

, SlB,-r-Ypiir leading article in Wednesday's issue under the above heading; gave me considerable pleasure, as it expressed so clearly my own thoughts after-read-ing Dr .Fisher’s lecture.' I have always admired 7 Dr. Fisher’s fluency; hnd I think it a .pity that/ With his 'obvious facility for clear expression, he did not give in this instance • any more practical suggestion for ending the’.depression than delightfully vague generalisations as were typified, in your quotation; viz., that this depression will disappear “ if a sufficiently large number of people take the trouble to penetrate to the foundations of : our economic organisation and boldly begin action along, the lines which a full understanding of the principles of an economically progressive society show to be essential.” HI suggest to Dr Fisher that, in his next lecture on this subject, he gives us, not nebulous generalisations, but a criticism of the practical suggestions that

have been advanced by leading economists and others; for rescuing the world from the present economic impasse. I claim no knowledge of economics , (in spite of passing University examinations on the subject some years ago), but the suggestions for. raising. prices put forward by Sir Arthur Salter in his book, “ Recovery,” would appear to be of some practical application, because I imagine they are now part of President Roosevelt’s scheme for restoring the internal price level in the United States. Sir Arthur’s book was written t before America went off the gold standard, but she etill has the gold which, presumably, is the backing for her note issue. . He writes in his chapter, “The Immediate Task,” with .particular reference to France and America; — They, could first bring back prices towards their. 1929 level by creating as much now money as their stocks of gold will bear without endangering the gold parity of their currencies. This policy will be useless unless it is allowed to have its normal effect on the course of trade, increasing internal prices‘ and imports and diminishing exports—an unattractive : prospect but perhaps bettor than the only alternative, which is, that the whole adjustment and not a part only should be at the expense of their exports. The process would be more successful it It were positively assisted by two further measures, first, a direct stimulus to public works at home by Government action, so that as an additional supply of money was forthcoming, a responsive demand would be ready to meet it; and secondly; a reduction of tariffs.

Here in Sir Arthur Salter’s' book are concrete proposals for recovery. They will not be new to Dr Fisher, but 1 would be interested to know if he would prefer to rely on “a sufficiently large number of people taking the trouble to penetrate to the foundations of our economic organisation,” etc.,, or whether he considers Sir Arthur Salter’s scheme and President. Roosevelt’s practical efforts to put recovery into effect are'not without merit.—l am; etc.. Lux. Dunedin, June 29. ;