AN ALL-ROUND CUT.

Southland Times, Issue 21516, 5 October 1931, Page 3

AN ALL-ROUND CUT.

To the Editor. Sir, —For some considerable time a friend and I have been examining a proposal which, in our opinion, would go a very long way to restoring the finances of the epuntry and the condition of the people to a more prosperous state. In brief the suggestion is this: that taking a date previous to the bringing down the ten per cent, cut in salaries and wages—say March 31, 1931—practically everything in the country should be reduced by 25 per cent. This would apply to commodities (clothing, foodstuffs tools, instruments —in fact, everything purchasable), interest, rents, local body taxation, salaries and wages, legal, medical and professional fees. At first sight, perhaps, the suggestion appears to be revolutionary and extremely drastic; but on looking into it one sees many points worthy of approval. In the first place, the wage-earner with his rent, food, clothing and amusements reduced, would be just as well paid in real wages. The retailer, making a 25 per cent, reduction on his stock, would be immediately recompensed by a corresponding reduced wage bill, and rent, and interest on his overdraft. The New Zealand manufacturer would be the greatest beneficiary in that he would have immediately a 25 per cent, advantage over overseas competitors, and it would undoubtedly give a great impetus to local industry.

There are two other classes to be considered—the moneylender and the farmer. The former would only suffer loss in that part of his income which is in excess of his actual living requirements. The farmer has, from all accounts, suffered already a loss of income variously estimated at from 30 to 50 per cent. Pie would derive the greatest assistance in the reduction of all costs. Every public speaker and economist is emphatic in declaring that these costs must come down before the farmer can carry on, so this might prove a solution of the problem. I know this scheme is not a perfect one in that it will not meet with universal approval; but it is one which bears looking into, and I would be glad if in your columns some of your readers —business men, farmers and working men—and you, yourself, Mr Editor, would express their views and offer criticisms and suggestions. During the past few months I have been reading the writings of economists of many countries, and I have been impressed by two points: the wide divergence of views expressed as to the cause of this depression, and the equally wide divergence of opinion as to how and when it might be cured. Meantime we see by every newspaper evidence of swiftly advancing chaos throughout the world —revolution in Latin countries, riots in England and Canada, even to a revolt in the navy, all due to the same sources. In this country we are drifting every day faster on to the rocks. What promised to be a six million deficit a month or so ago is now going to be eight millions. A few months ago we had 13,000 unemployed: now we have over 50,000. We know from our own experience that in the city of Invercargill, business men of all types are experiencing most difficult times. We know the farmers are drifting. And it is with a view to offering a suggestion to alleviate this condition of affairs that I have penned this letter. Should any writer care to place his suggestions and criticisms in writing, I would ask him to do so dispassionately, so that we, as students of affairs, might between us in Southland come to some conclusion that might be of benefit to our country.— I am, etc., STUDENT.