0LABOR’S ATTACK

Poverty Bay Herald, Volume LX, Issue 18205, 28 September 1933, Page 7

OLABOR’S ATTACK

THE ADDRESS-IN-REPLY NO-CONFIDENCE motion COMPEEHENSWB TEEMS TAX REUKP ADVOCATED (Pc' Tress Association.) WELLINGTON, lust night.

In resuming the Aildress-in-'R-eplj deliati? in the House of Representatives, the Leader of the Opposition. Mr 11. E. Holland, moved the following amendment: — “That this House affinys that, the Government has refused, to recognise that the' critical conditions of soviet v demand’ a" definite plan of financial and industrial reconstruction, including tho preservation of equities in land and homes, and a reduction of overseas indebtedness to present-day values; that it lias refused to nthke provision for unemployed women and vouths; that by its deflationary policy it has intensified unemployment, distfoss,’ and privation, and made home life among relief workers an impossibility; that its present system of ur.ornployment relief is costly and uneconomic; that the high exchange has had a disastrous effect upon the economic life of the Dominion; that the increased and inequitable taxation, including sales and unemployment taxes, should'be immediately revised and ultimately repealed; that the curtailment of'social services and the reduction oi wages, salaries and pensions have crippled' trade and impoverished the nation; that the present monetary system has failed to, provide for the requirements of the people; and that the complete public control of a monetary system based on goods and services and “capable of expansion according to growing needs, should be substituted. The House further “affirms that Your Excellency’s advisees do not possess the confidence of the country.”

SHORTAGE OF STATESMEN Mr Holland said that neither the mover nor the seconder of the Address had made any attempt to explain theparadox of want and poverty iu the midst of plenty. lit would bo Ibetter for the Government if it faced up to that paradox, for there was no doubt that it would have to be faced sooner or later. He would like some Government member to explain during the course of -the debate why it- was necessary for men, women and children to go without sufficient, food, when there was no shortage in the Dominion; why people * should go without sufficient clothing while the factories and the warehouses were filled with articles they could not sell;'and why the people had to go without coal while the mines of the Dominion were idle. There was absolutely no reason why anybody in New Zealand should go without the necessities of life. Apparently the only shortage was the shortage in statesmanship, and the capacity to so organise the country’s affair's that people who wanted work could secure it at a fair remuneration. M<r Holland went on to refer to New Zealand’s representation at the World Conference, and said he had always held the opinion that 'there had been no need for New Zealand to send Ministers abroad for that purpose. The High Commissioner could have done everything that Messrs. Forbes and' Masters had done. Mr 11. At more (Ind., Nelson): And have done it better.

INCREASED NOTE ISSUE Mr Holland: He could not leave done worse, because nothing was done. I think the expenditure on the journey was a hopeless waste of money, especially in view of the absence of any results from the conference. It is true that the Prime Minister came back with a somewhat more hopeful outlook than he generally assumes. Mr S. G. Smith (Coal., New 1 lyjnod'th) :* It must have been a success, then. Mr Holland. It was too great a price to pay for a more hopeful outlook for the Prime Minister. Continuing, Mr Holland said there was power to-day to print double the number of hank" notes in circulation. It was necessary that the Government should have power to produce whatever leo-al tender currency was necessary for the public and private business of the country. Over 90 per cent of New Zealand's currency took the form ot the cheque system, and a cheque was only valuable* when the goods were behind it. Referring to the Goverrunent s nig-n exchange policy, the Leader of the Opposition said that everybody knew the history of the Prime Minister s change of front on the issue, but had yet to receive an explanation of why the banks had somersaulted on the question. The hopes that the farmer would benefit from pegging the exchange at a high figure,had not been realised-

FIXED PRODUCE PRICES No sooner had action been taken than Denmark; had followed suit, and France had put a heavy duty on goods coining from countries with a high exchange. The Labor Party s pioposal for definite trade agreements, and for a guaranteed .price, <was an infinitely better proposition from the farmers viewpoint than a high exchange. He was satisfied that only a very small proportion of farmers had reaped any direct benefit from the Government’s policy. The only farmers who had benefited were those who were mortgage free, or those who had not hypothecated their incomes to mortgagees. Apart from the farmers he had mentioned, the financial institutions were the only other beneficiaries, and the Government had had to impose fresh and unpopular taxation to meet the ease. , , , . Mr Holland expressed the hope that the majority of members would realise their dutyTo the country, and give expression to the country’s desire by supporting his amendment. The amendment was seconded by Mrs E. ft. McCombs (Lab., Lyttelton).

MINISTER IN REPLY Tho lion. J. A. Young said Unit the Leader of the Opposition had found fault witli the. Government’s administration, but, had not. suggested what the Government should do. In a comparative sense, New Zealand had done very well, and had made very satisfactory provisions for the unemployed. New Zealand's expenditure on unemployment, compared with that of Britain, showed that the Dominion was doing more per capita than tho Old Country. The Leader of the Opposition bad inferred that the Labor Party would pay standard rates of wages i! it was in power, but as the money was nut available, this would be impossible. High wages could not be paid if industry was not paying, even if tile payment ol such wages did keep up the purchasing power. The Government had been accused of making matters worse by its deflationary policy, but he contended that deflation liad been absolutely necessary, so that fixed charges could be brought down in keeping with the diminishing returns.

Referring to the World Conference, the Minister said that no matter how small the. results might have been, the fact that New Zealand had been represented in Britain at such a critical time was of great value to the country. PAPER MONEY CONDEMNED

Continuing, the Minister said that currency was governed by the prices realised in the world markets. Values could not be fixed in New Zealand, and anything that might be done would only he transitory in effect. If the Government were, to issue paper money based on the value of goods produced, the value of the goods would not be increased, nor would the value of the country’s currency bo increased. All that would bo increased would be ttie volume of paper money in circulation, and there would be no advantage in having twice as many pound notes as previously if two notes were required to purchase what had been bought previously for one.

The Leader of the Opposition had said that guaranteed prices would be better than a high exchange, but debts would have to l>e created to pay guaranteed prices, and those debts would have to be redeemed. It had to be admitted that the high exchange had added to the cost of imported goods, but, notwithstanding that, the cost of goods had continued to fall.

Tho Minister stated that a. lasting 'solution of tin; world’s troubles would | have do be found, and all sorts of trials and experiments would have to he made to find a way out. While it'll at was being done, it was a mistake to create discontentment. There was a definite improvement, all over the world, and the effect of improved prices for primary products would soon lie felt.

Mr W. J. Jordan (Lab., Manukau): That is the result of the rest rick'd output.

Mr Young said the output had been increased instead of being restricted. Shipping companies were busy building larger and better ships to handle the increased trade throughout the Empire.

Mr Young referred to the firming values on the stock market, and said that the better prices offered for Government bonds indicated the sound position of the country, and a general return of confidence. OVERSEAS LOAN CONVERSION Mr W. ,t. Jordan (Lab., Manukau) referred to the rise in the prices of primary produce, ami said that while the producers would soon get more for their goods, workers would have to pay more fur their food. As soon as butter prices advanced in Britain, the retail price in New Zealand also went up, and the people in the Dominion had to pay more for their butter than was paid for New Zealand butter in England. Dealing with the'World Economic Conference, Mr Jordan said the aggregate work of the conference amounted to nothing. In all the talking that had been done, nothing had been said about improving' the condition of the masses. Continuing, Mr Jordan said that the London moneylenders’ organisation was giving greater eon cessions and more favorable terms generally to Austria' and' Germany than to New Zealand. He believed, however, that it' an effort were made, it would be possible for New Zealand to convert her loans, as Australia had done. He considered that action should be taken it lull <r these lines in orefereiiee to re-

during the pensions of miners’ widows, Maori War veterans, and others. Mr .Jordan submitted' that: it he New Zealand ('ioverni)ieiit, was prepared to subject tlie people to starvation rather than compromise witli the overseas moneylenders. FARMERS’ DIFFIGU LUES Mr. A. D. McLeod (Coal., Wairarapa) said that' hugo overseas debt payments could only be met out of revenue obtained from the Dominion’s exports. It was necessary that every acre of settled farmland should produce £ls to meet these payments. He went ou to refer to the wool prices, and said the average return at the recent London

sale had been £7 40s per bale. The costs incurred between the time the wool was dipped from the sheep’s back i and the time it was sold in London averaged £4 5s 6d per bale, leav mg Jess than £3 5s for the farmer. This was irrespective of farm costs prior to the i tiiqe the sheep entered the shed, lie added that the costs in other primary producing industries were equally heavy. . lie was satisfied that the raising of the exchange rate had been definitely beneficial, and that while it might not bea permanent cure, it at least temporarily eased the burden. Mr. M. J. Savage (Labor, Auckland W.) said the Dominion’s monetary system and trading conditions should he based upon such internal price levels as could be. maintained by the productivity of its industries, 'file monetary system should further be based on goods and services in order to provide credit and currency suftieient to meet the rise or fall in Dominion production, 'the control of banking should be transferred from private banking corporations to the State. Brices lor Dominion products should he guaranteed, and should be supported bv guaranteed incomes sufficient to enable the people to enjoy'the result of their labors. The anarchic methods of production and distribution must give place to planning in conjunction with price guarantees. World conditions indicated that all countries, including Britain, were striving to provide their own needs. Tfiat could be met only by the establishment of additional industries in the Dominion in order to employ our own people. PUBLIC WORKS ADVOCATED Primary production must pltiy the major part in national life, continued Mr. Savage, and the security of those already ou the land called for immediate action. Mortgages on land and hoincs should-be adjusted oil the basis of the average of wholesale prices for the past seven .coin's, and in the : meantime legislation should lie passed preventing foreclosure, pending the establishment of‘internal pride levels and rates of pay sufficient to enable holders to . meet their commitments'. Social' services should be extended, and a. schedule ot

public works, local and national, ot first-class importance, should be prepared for the purpose of giving immediate remunerative employment. 'I He hours of labor should bo reduced m relationship with productive machinery and scientific processes, and wages should be increased in relation with increased production. External debts should be scaled down in relationship with the increased value ol money measured in exports. Mr. V. W. Schramm (Labor. Grey Lvnn) said that the Government’s deflationary poliev had intensified the position it'had set out to rectify. Its record had been a disastrous one. He expressed regret that no provision bid been made to relieve those liable under a personal covenant in mortgages, and contended that the Government should ensure that mortgagors who had lost their equity in property should not be compelled 'to sustain further financial loss. The debate was adjourned «"> the motion of Mr. D. G. Sullivan (Labor. Avon) and the House rose.