INFLATION.

Southland Times, Issue 21772, 29 July 1932, Page 3

INFLATION.

To the Editor. Sir.—The vital question which presents itself to us is that we have 55,000 unemployed, that the outlook for these people is nearly hopeless, that their morale, energy and ambition is being destroyed and that the prospects of the

rising generation are -at the present time blank. In addition to the Primary Industry, secondly industries are necessary to meet the situation and find employment for the large population that is growing up in the cities of this country. > Work must be found; and if the people are too nervous or too overcome by the effects of the depression to assist in establishing industries, then it is the duty of the authorities to give a lead and, endeavour to remove - the mental and physical lethargy from which everyone seems to be suffering. I appreciate the danger of an uncontrolled issue of paper money as much as . you Mr Editor, and, in mentioning an amount of £20,000,000 I perhaps exceeded the safe limits. However I still maintain that a safe limit could .be fixed for an expanded currency which would be sufficient to give the Government the necessary powers without borrowing to assist present industries and bring new ones into existence. Currency expansion is not an uncommon thing, and, is used in many countries without affecting prices and without being noticed by the people. America has just passed legislation to expand the currency by one billion dollars to assist industries and find employment for her huge army of workers standing idle. You will perhaps say that she has made the issue against her gold reserves, I say that the wealth and credit of the country is sufficient to enable her to do it if there wasn’t a sovereign in her vaults. If America can do that with safety why cannot we do the same, by using the credit and wealth of the country to move the industrial machine. An argument put forward against it is, that we could not trust our politicians with an expanded currency. This is a poor compliment to our representatives, and, if they are not to be trusted it is surely our fault in choosing them. You say that the industries I mentioned could not be made to pay and that the people could not be induced to support them. I admit it is very difficult to induce people to invest at present, to use a colloquialism—you. couldn’t float a cork—and the experience of the flax industry’is an example. The spirit of enterprise is dead and the mental and physical energies of the people are swallowed in the yawn of the depression. It is up to the authorities to find a way to remove that condition.

In this town thirty years ago we had several hundred men employed in the iron industries making implements etc. wool scouring, fellmongeries, a woollen mill, rope and twine works, and dozens of girls and women in the dressmaking and millinery departments of the large drapery establishments. They have passed out of existence, why? The “borrowing and importing bug” has eaten the vitals out of industry and there are 55,000 people at the funeral. You said the Orepuki Shale Works could not be made to pay, that is an expression of the “can’t be done spirit” which is abroad, and which you evidently support. I don’t think from what I know that the Orepuki Works ever got a chance to live. The Stars and Stripes flutters over our oil industry, and wc are too weak and tired to try to remove it. Living in the hope that prices are going to rise in the outside world and that things are going to improve is a “dullard’s paradise,” If they don’t rise, and if the markets are glutted, we will then have to find a way of helping ourselves and we may as well start now and be ready for anything which may occur. I feel Mr Editor that you are as keenly interested as I am in helping to improve the present conditions, but I cannot agree with you in supporting the tired multitude who continue to say “it can’t be done.”—l am etc., W. HINCHEY. July 28, 1932. [We did not say the Orepuki Shale deposits would not pay. We took the point that it was said people would not invest because they believed it would not return a profit, and Mr Hinchey proposed to invest Government money in such a scheme.—Ed. S.T.]