THE ECONOMIC CRISIS

Poverty Bay Herald, Volume LV, Issue 17502, 26 February 1931, Page 7

THE ECONOMIC CRISIS

WORLD-WIDE PROBLEM REAL CAUSE EMPHASISED LOW PRICES OB' PRODUCE (British Official Wireless.) Lee. 10 a.m. RUGBY, Feb. 24. file Prime Minister, who visited tne heavy section of the British industries J air at Birmingham yesterday, was tile aue.st of the Birmingham Chamber of Commerce at. a dinner last night, lie said lie was much impressed by tiie (ptimistic note prevailing among exl.rbliors.

Referring to the: general' outlook lie

said the present prouiem was not one ot production, which was more etncicni man ever beiore. There was uu problem l.i consumption. People' were prepared t.i consume more than they ever cons.imeu beiore. Where the iault lay was tnat between production and consumption something came in, and prices got dislocated. For some reason or other primary producers could not get prices that enabled factories to be uusy, and until they laid their heads together and d.scovered how production ancl consumption could be related to each other more directly, those great factors would continue to disturb the markets of the world. That was a wqrld problem, but within that world problem there was a national .problem. Our taxation was heavy, deplorably heavy. Half of it was to keep our nation’s word as its bond. The other half was subject to public opinion, which was intelligent enough to approve a policy. The House of Commons, with the consent of the Government, had set up a committee to review public expenditure. He hoped the committee would be expeditious in its work. The Government was so convinced of the importance of expenditure that there would be no time lost in getting that committee into working -operation. Abuses must be pruned out. Cuttings must be not by rule of thumb; they must be suitable in a moral sense as well as productive of economic results. In economy they had to remember that they were faced with a doubleedged problem. Economy did not merely mean saving, it meant expenditure of the right' kind. Expenditure and wise saving were the two aspects of economy, because in times like these the country ought to bo prepared for an expansion of its resources and increase in efficiency.