“DEMOCRATIC DEDUCTIONS”

Otago Daily Times, Issue 22720, 5 November 1935, Page 4

“DEMOCRATIC DEDUCTIONS”

TO THE EDITOR Sir,— “Ally the Owl ” seems to have partly recovered from the daze which the editor’s non-acceptance of his figures must have applied to him. Though, however, he claims to see in the dark clearly, be has not yet seen that Mr Coates’s statement that the Democrats’ promises of pensions, superannuation, etc., will cost £22,000,000 has been proved a “ myth.” Strange to say I am not happy in the heading “ Democratic Deductions,” which the editor gave to the first letter from “Ally the Owl,” but would prefer “National Indebtedness and Exchange Debt.” In my reply to “Ally the Owl ” I used for, comparison the borrowing figures for the Governments of the past 10 years to show that the average annua! borrowing had been £9,000,000 in that period, and that the maximum annual borrowing in the

four years for which the Democrats hope to hold the Treasury Benches would be £5,000,000, and that only for productive purposes. Surely Mr Coates is occupying a peculiar position in disclaiming borrowing. Now, will “Ally the Owl ” tell us how much of that borrowing of £9,000,000 average over the past 10 years has been for productive purposes? HoW much productivity can be due to the Hillside glasshouses and to the large quantity of unused machinery at the Kailway Workshops, and how much interest the £3,500,000, which the Waitaki hydro works has cost, has earned to date? How much “ juice ” has arrived at Dunedin yet? Perhaps “Ally the Owl ” will ask Dr M'Millan, who had a “ good thing ” there as medical officer for some years.

But here is the joke which “Ally the Owl ” missed swinging on to me. Apparently he did not know. that of the £91,000,000 borrowed during the last 10 years, £22,000,000 was due to the exchange policy of the Government, and with this amount taken away from the total the average borrowing was exactly the same as the “ heavy ” borrowing policy of the Democrats. Owlish, I would say! Now, will “Ally the Owl ” explain the result of the acts of the present Government and not make imaginative deductions about the promises and possible acts of a party which will not command the confidence of the thinking section of the community. For, thouglx I study the policies of all parties, and would vote to secure a change of Government, I am not voting Democrat. Will “Ally the Owl ” seek the figures in the Year Book and the recurring statements of assets and liabilities of the Keserve Bank (which has a capital of £500,000) and then tell us whether the asset, sterling exchange of almost £17,000,000, ,of the Reserve Bank is a “ debt ” of the New Zealand Government or a “credit” against the trading banks? Will he also tell me whether the bank has borrowed Mr Davy’s secondhand printing press to print the £8,800,000 of notes which form an' item in its statement just published when it has a share capital of only £500,000? On March 31, 1934, the National Debt is shown in the Year Book as £302,000,000. On March 31, 1935, I believe the total is £285,000,000. Will “Ally the Owl ” explain on behalf of hie Nationalist friends why the difference is exactly the amount which the Reserve Bank holds as an asset in “sterling exchange,” and further, if it was in the National Debt in 1934, why leave it out in election year?—l am, etc., Year Book. [The heading to the first letter by “Ally the Owl ” was that correspondent’s.—Ed. O.D.T.]