Rangitikei Advocate. TWO EDITIONS DAILY. MONDAY, OCTOBER 16, 1916. THE BUTTER CONTROVERSY.

Rangitikei Advocate and Manawatu Argus, Volume XLI, Issue 11696, 16 October 1916, Page 4

Rangitikei Advocate. TWO EDITIONS DAILY. MONDAY, OCTOBER 16, 1916. THE BUTTER CONTROVERSY.

THE price of butter injhe Dominion, present and prospective, lias become one of the most canvassed subjects of domestic economy. On the one hand are ranged the consumers, with, however, no organisation and only partially articulate, and on the other the ['producers, ' who are naturally desirous of obtaining as high a price as the open competitive markets of the world will allow. Admittedly the increase in the price of butter constitutes a very grave trouble to the great mass of consumers. It has probably appreciated in value to a larger extent tlpm any other daily necessary of life, seeing that the rise has amounted to more than seventy-five per cent, above what it sold at, comparatively ;re-

centlj*, with a possible increase to two shillings per pound in an the near future. It may even soar beyond that figure. The result must inevitably he that, in a laud flowing with milk and butter, to a very large proportion of the population both must soon become as unapproachable as though the country was being subjected to a siege. The situation, when viewed in the light of the facts of the tremendous productivity of the dairy industry and that the country produces immense!}’ more than it consumes, appears to be sufficient!}’ abnormal to evoke all the criticism to which it is now exposed and to invite all the remedies which are offered for its

solution. These latter range through a whole gamut of absurdities, those of the Board of Trade being as empirical in their nature as the views of the man in the street. JLn its teutaive proposals to the dairy companies the Board recognised that factories supplying the local trade were at a disadvantage compared with exporting companies and, therefore, proposed that the price should not be increased bnt the loss thus suffered by the companies supplying the Dominion markets should be made good to them through the medium of a small tax on all butter fat. This crude proposal was rejected by the representatives of the dairy companies. After stating that the value of butter for export was equal now to one shilling and tenpence in New Zealand the representatives of the dairy companies, however, advanced a proposal which ■was probably more absurd than that of the Board of Trade. They suggested that* 4 if any limitation of price is deemed necessary, the cost of such limitation should ba a charge against the consolidated revenue, in support of which we instance the precedent of the Imperial Government with respect to increased rates of the wages of railway workers in Great Britain.”

The situation is one which undoubtedly demand exceptionally wise and tacful consideration, bnt mostly, -we believe, in letting it alone as much as possible. The [great mass of the people who are reaping no commercial benefit from the hign war prices, and are only’ bearing price burdens and are contributing their sons to the fighting line, deserve every possible lightening of the economic burdens that the mpre affluent can compass in their be half, But for the sake of a penny or two per pound on butter only it is inadvisable to do violence to all the conventions which govern trade. If it is advisable to apply the stop-price doctrine to one industry in order to keep the necessaries of life within reasonable

bounds the logic of the situation demands that it 'should be applied to all. We are not concerned with the doctrines of the more inflexible political economists. Very few people now are at all appalled by the interdictions of the science, but would fracture every single article in the decalogue of the political economist if we could thereby increase the well-being of the individual. But it seems to us that the wisest course in this case is to

allow the local price to rise to, and maintain, a parity with the price obtained forexported butter or smash the whole doctrine of supply and demand by putting an equal embargo on ail increases of prices. It must be remembered that other countries are exporting butter to Britain, and that our exports on landing there are subject to the competition of the work’, and it is this which naturally governs value here. It cannot go higher and is unlikely to drop lower. To impose restric-

tions on the dairyist is to block him from obtaining the advantages from the British market which neutrals and possible enemies are reaping and that would be both unfair and unwise.