Poverty Bay Herald PUBLISHED EVERY EVENING GISBORNE, SATURDAY, NOV. 10, 1934. “THE NEW DESPOTISM”

Poverty Bay Herald, Volume LXI, Issue 18551, 10 November 1934, Page 4

Poverty Bay Herald PUBLISHED EVERY EVENING GISBORNE, SATURDAY, NOV. 10, 1934. “THE NEW DESPOTISM”

The increasing participation of the State in the field of business has been the subject of interesting comment during the past few days, two notable contributions being those of the retiring president of the Associated Cham bers of Commerce, Mr. Seaman, ann tin 1 Hon. \Y. Downie Stewart, both ni whom have been conspicuous in the past for their antagonism towards an) undue interference with private enter prise. While neither of these gentle men appears to have arrived tit any definite conclusions, both have opened up some extremely pertinent points for consideration. Mr. Seaman, foi instance, candidly admits that while the average business man protests against Government interference, h< will gladly submit to it, and oven seek it, if he conceives that, it will lie to his own financial profit. Mr. Stewart Utribut.es somewhat similar motives lo tile Socialists themselves. At one time, he said, they wanted for fhr community the rich profits they saw

pouring into (lie pockets of the commercial magnates; now they were clamoring for Government control in order to stop losses. Here are two very keen minds both suggesting that opinions on a question of vital interest to the community are based mainly on ulterior motives. It is to be feared that this is largely the ease. Business people who have been .so prone to protest against the intrusion of the Plate in the field of commerce have frequently been the first to run to the Government for assistance* when times are bad. The.working class has acted in a similar manner. When conditions were prosperous they agitated for legislation to improve their position; and when the reverse is the case they again appeal to the Government to protect them in various ways. Not infrequently, the difficulties in which industries find themselves are created, or at least aggravated, by earlier action on the part of the State. The primerv objection to this state or affairs i.s that if tends to place the fortunes of industry in the hands of the Stale, instead of in the industry itself. It. is an unfortunate fact that the tendency to-day is more than ever before to place undue reliance on the Government, this, no doubt, being a natural outgrowth of past actions. In the past, the business man generally was bitterly opposed to the creation of monopolies by .State control; to-day, although he calls it by a different name, he does not hesitate to ask Ihe Government to control and regulate

industry i:«. order to prevent uneconomic competition. To a large extent, li f . is justified. Throughout the world a new movement has been taking 'tiape, and everywhere if is in the direction of the State exercising a greater influence in the economic sphere. Whether such a development is desirable, even as a temporary measure in times of stress, must remain a mutter of opinion, and its success or failure has yet to be proved, but whatever the ultimate result there is scope fur much careful thinking and apparent dangers which must, be guarded against. In view of world conditions it has to be accepted that some form of regulation is almost a necessity, but this should not be taken- to suggest that the remedy lies in State monopolies. On the contrary, the extreme difficulty of trading conditions is the strongest argument against the Government embarking upon enterprises to which it is unsuited. There is however, the alternative of the regulation by the State of private enterprise, and the cautious developments in this direction are more likely to prove advantageous than otherwise, although, under the best of conditions they are beset with many dangers. These dangers were emphasised by Mr. Stewart, and it is fitting that, they should be, for those concerned are always inclined to see only the advantages of any new policy find to overlook the possible permanent disabilities that might be created. While it is a legitimate function of Parliament to exercise some measure of control over the economic life of the country, it : s an entirely different matter for the Government itself to become an active participant in business. The Public .Service Commi-s----sioner. in his annual report, discussed and defended what has been termed “The New Despotism,” under which legislative powers are delegated to public servants. The defence of this new system is based on the admitted fact that there have been increasing demands by the public for new and more detailed legislation. If these demands are acceded to, it is inevitable that there should be a growth of bureaucracy, and the remedy lies, not in objecting to government by Orderin Council, lull in educating the public to refrain from making requests lor legislation which makes a delegation of powers essential. It is a case o! cause and effect, and the very interests that are responsible for the cause are frequently the ones who object to Ike effect. The legislative machinery was not devised with the intention' that it should perform ihe functions of a vast business organisation. and few members of the Legislature' are gifted with the administrative ability for such a function. The more the Government becomes involved in business, therefore, the more does it. become necessary for it to rely on the officers of its departments, whose capacity, also, is severely restricted. The danger of such a procedure is evident, for, not only is there a serious possibility of inefficient control, but there is also the strong inclination to cover up inefficiency bv merely seeking wider legislative power. Admitting, therefore, the admost dramatic change in outlook, and conceding the desirability of the bate using its influence and its power in. an endeavor to establish economic stability, it must still be remembered ihat, there i s a vast difference belween Government; ownership and Government regulation, for while the one might be both necessary and desirable, the other, instead of providing a remedy, would most certainly prove disastrous.