NEW ZEALAND PRODUCE

Otago Witness, Issue 3510, 21 June 1921, Page 58

NEW ZEALAND PRODUCE

LOW PRODUCTION AND HIGH - WAGES.

In the course of his address at last week’s meeting of the Bank of New Zealand, Mr Harold Beauchamp (Chairman) touched upon the finance ot the dominion and the position of produce dealing fully with tile wool situation and kindred matters. He said that had the Imperial Government continued purchasing our produce at tho same prices as when tho various commandeers ended, we should have been still revelling in prosperity. Just what the Imperial purchases meant to New Zealand might be realised from the fact that the total payments made by the Imperial Government up to April 30 amounted to £158,602,725. The outstanding feature during the past season in connection with produce was the excellent return obtained from both butter and cheese, but it was most difficult for anyone to express a definite opinion on the prospects, because the conditions were subject to such violent changes. Britain was our best, and practically the only, customer for our dairy produce. This customer lias been impoverished by the war, by internal strikes, and by political unrest, and by the inability of Europe to purchase goods except at small prices, in reduced quantities, and on long terms of credit. It would be folly to expect that butter would again sell at £230 a ton, but. just what it was likely to rule at would depend upon the developments of the next eight or ten weeks. It did not seem possible, however, that butter would fall to the 1914 average of 116 s per cwt, and he was satisfied that the price would be much lower than that paid by the Imperial Government during the war. Wool had apparently fallen to its lowest point,—at all events for the time being—and there was now a hotter demand for the staple and more activity in the market. There is, however, a great mass of wool in store, and how to get this into consumption and at the same time to obtain a lair price for the clips now coining forward was a problem that had been fully and freely discussed for some months past. At tho present moment, wool was almost a drug on the market. This applied especially to coarse wool, and by far the greater part of our New Zealand product was of this class. Apart from the largo quantity in store, the European and North American clips were now coming in, and in the course of a few weeks Australia would be baling another clip, while there would also be Argentine, New Zealand, and South African clips to be taken into account. On the

other hand, only a limited market could be found in the L T nited States. The proposal to uphold values by arbitrarily fixing prices did not commend itself to him, for values could be created only by the inexorable) law of supply and demand, and not by any artificial means. Large though the accumulations were now, they would be speedily reduced if the people of Europe were able to make purchases, but they wore unable to buy through sheer inability to pay for tho goods. Until Central and Eastern Europe wore able to absorb wool, tho market would be in an unstable condition, zig-zagging up and down and causing a groat deal of trouble. “So far as we are concerned,” Mr Beauchamp said, “wo may look for many

changes and the collapse of many econcmio faiths that have been built up on fallacies. Socialism, Sovietism, Communism. Bolshevism, and all other ‘isms’ that have been invented by dangerous cranks and much more dangerous agitators must perish. \V„ must take a broad view of the eutlook, tor, if we are to ha\o any improvement in New Zealand, That improvement must emanate from outside, and lor us that ‘outside’ means Britain. ihe -pe.-d with which recovery takes place in Britain must largely depend upon the position on the Continent of Europe. Indeed, the trade and commerce of tile world cannot be reinstated without tho inclusion ei Central Europe and Russia. This will involve time, because the situation in many European States is being mishandled bv the politicians who have been afraid to tell the people the unpleasant truth, and instead of preparing them to meet hard times, slack employment, and high taxation, have steadily persisted in painting the position in bright colours anil in devising any artificial measures which would put off tho evil day of realisation. In every country it is desirable that bureaucratic control and interference with trade, commerce, and industry should cease. Hard work and thrift are still tile only way to salvation. Capital and Labour must be drawn closer together. It. is a truism to say that there is a general desire to give to Labour a fair share in the results of industry, preferably in tho form of high wages lor efficient. production, lint Labour must realise that the laws of Nature cannot be defied without serious consequences. Several occurrences of the past few months go to show that this is not realised by some of those who sway the councils of organised Labour. Within the dominion there is an abundance of coil developed, and needing only labour to bring it to the surface; yet if. has been found necessary during the year to import coal to the value of not les3 than £746,467. and it; has recently been announced that the Government has mado large contracts for tho importation of Welsh coal. Ail this money which, in these times of stress, would serve so useful a purpose in providing employment within the dominion has been sent out of the country, and is incidentally helping to increase the exchange difficulty. Low production mid high wages cannot exist together, and ultimately mean loss to the worker in having no work to ‘go-slow’ on Diminished production increases tho burdens of tho worker and reduces tiio purchasing power of his wages. In New Zealand there must be a greatlyincreased efficiency of production or great reduction in wages, or the alternative—increased unemployment. The Arbitration Court, in endeavouring to stabilise wages for tho next 12 months at the present level, is unconsciously contributing to the growth of unemployment, because the country’s industries cannot sustain the present standard of wages unless there is a very marked increase in production through efficiency.” “Sustained effort, in production, efficiency, and economy,” said Mr Beauchamp, “should be the kev-note of all classes of the community in these critical times.”