LEVELLING DOWN

Poverty Bay Herald, Volume LV, Issue 17406, 3 November 1930, Page 6

LEVELLING DOWN

COSTS OF PRODUCTION UNECONOMIC STANDARD The acting-Prime Minister said in answer to a recent deputation asking for a higher basic wage that it amounted to 4 request to fix a basic wage for workers irrespective oi the work done. Cannpt these spokesmen for wageearners realise that the worker would be. no better off even if his wages were doubled unless there was a corresponding increase in the work done so as to reduce the cost of production. If wages are increased as requested by the deputation, the workers would suffer iu another direction as the whole'country would be much worse off because it is less able to sell its products abroad against, goods of other countries—produced at lower cost. Thus nothing would be gained by a rise in wages while .u great deal would be lost. While every avenue is being examined to reduce the cost of production, wages based on a. false principle are supposed to be sacred, yet the value of these wages depends entirely on an all-round reduction in cost. The-nominal rate of wages does not 'count, it is what they will purchase which is the importantconsideration.

What is needed is a general levelling down, cheap money has. unduly inflated the value of land, thus the farmer Is paying more interest than lie ought to because -lie has borrowed l more money. ; dj than his real land values will warrant; H taxation has gone too high, because they State is spending money on uneconomic railway and otner constructive works*, and is not economising enough on its., administrative expenses. This high taxa- u, tion supported by the Labor Party in V Parliament has . already, in August, caused, a rise iu tire cost of Jiving due to increased customs duties, and by that rise alone this party has helped Jo lower the purchasing power of wages. Rates have gone up through over-borrowing and the carrying out of works on ex- ;; travagant lines; this prevents rents from coming down. So much capital has been locked up in public and local body loans that the actual, wealth available is ~ scarce, and this results in keeping up interest. Wages are fixed in a false basis, and organised Labor has succeeded- in imposing so many restrictions on output that costs have gone up—in short almost everything is on an artificial and uneconomic standard which prevents oui- * primary producers from competing with ilie world's prices.

‘ WRITING DOWN” SUGGESTED In the face of these facts it is difficult- fo understand on what principal the Government refuses to call a general confeienee, of all sections and interests in the country, to thoroughly investigate the possibility of a simultaneous writing down of values, prices, interest, rates, rents, taxes, wages and other" things which help to keep up our cost of production. The advantage hf a conference would be that the difficulties of such a “‘writing down” would bo fiankly explained. For instance, financial institutions could say what prevents reduction of interest*;" wholesalers and retailers could explain the problems they, would have to meet. This is the only way to arrive at any result, it everyone came down together, all would be iu the same relative position, but the effect would be such a reduction of costs that the country could meet its competitors in open ma'rket to the benefit of everyone, and unemployment would be relieved.

Mr. Fenton, acting-Prime Minister in Australia, recently said, “It can clearly be seen that we are dependent to-day-fur employment of the people upon private enterprise. We must all play our part. A Government can legislate, regulate, and do many things which would assist in increasing employment, but private enterprise is the real solution of the problem, ’ and we venture to think that one. of the "many thincs ’ the Government ‘Nan do” in this country is to convene such a conference so as •to assist private enterprise to effect the necessary reduction of costs.;— Contributed by the N.z,. Welfare Teague.