OPUNAKE TIMES Speaks for the District. FRIDAY, SEPTEMBER 2, 1932 REPRODUCTIVE DEBT

Opunake Times, 2 September 1932, Page 2

OPUNAKE TIMES Speaks for the District. FRIDAY, SEPTEMBER 2, 1932 REPRODUCTIVE DEBT

There is insistence in Australia nowadays that every penny ,oi borrowed money shall be spent on reproductive works. The text is a good one which can only reap benefits for a people who have, been so bent on developing a continent in the past that they have not always insisted on this essential measure of every public works undertaking. The extent of failure has so far been demonstrated in a negative fashion. Australia has experienced difficulty in meeting debt commitments and has learned the effects of lack of sound loan expenditure. She has yet to experience the positive effects of sound loan expenditure and for an example of what one day she may herself enjoy she has to look abroad. In the depths of depression, the example was held before Australia of an Indian loan being floated in a few minutes in London on terms for beyond her reach. India has good reason to appreciate the cautious wisdom of those who have directed its borrowings and spenJihgs in the past. Like every other trading nation, it has been hard hit by the world slump in trade: but, unlike the great majority of its compeers, it bids fair to win through without permanent weakening of its resources. Of its total national debt of £900,000,000, all except £145,000,000 is represented by productive works of public utility like cafnals and railroads, which bring 'in. more than enough annual revenue to cover interest charges. India thus has no overwhelming burden of permanent payments to meet, and has been able to adjust itself to present straitened conditions. The Indian deficit has thus been kept down to manageable proportions, and a small surplus is expected at the end of the coining l twelve months. Meanwhile India is paying off loans as they come due. The Indian peasant, like other people, is feeling the loss of external markets severely. His decreased purchasing power is reflected in collapse of import trade. Good harvests nevertheless, have saved him from the more acute forms of want, it being one of the saving features of Indian economic life that 70 per cent, of the people are villagers whose wants are.few and who grow their own chief, means jof, sustenance. India is thus really/ to resume its part in the 'restoration of world prosperity whenever commodity prices revert to ndrmal. This happy state is the aim of Australia's financial policy. Had her loan expenditure been like India'*, the goal would have been more easily won, and what is said of Australia may be said in great part of New Zealand.