“THE BETTER WAY.”

Southland Times, Issue 22218, 10 January 1934, Page 10

“THE BETTER WAY.”

To the Editor. Sir,—l have no intention of continuing the debate which has arisen between us, but I would like space to reply to your leader of January 5. No doubt you realize the difficulty of dealing with such a vast subject in a brief manner and there is no time to deal with each phase in detail. I notice that you have no intention of dealing with the wider issues I mentioned, and yet I am convinced that it is only in facing these wider issues that a permanent solution will be found, for, as Ramsay MacDonald said, recent events have taught us that no nation can live unto itself. First of all let me deal a little fuller with the claim of our secondary industries for further assistance. We would be all quite pleased to see our secondary industries in a flourishing condition and quite pleased to do our part in buying New Zealand goods and are quite prepared to go as far in developing thbse industries which show a reasonable prospect of success (this is provided for in the Ottawa Agreement) and providing that those at the head are prepared to do their part and follow along reasonable lines. You, yourself, use the word “judicious” development and that word opens up the whole question. I firmly believe that if the Government took stock of the past it would reveal a long chain of assistance and protection beyond all reason, and that those at the head of our secondary industries have shown no move to better these anomalies. Over 20 years ago Ramsay MacDonald when passing through New Zealand drew our attention to this state of affairs and yet to-day we have in this country of one and a-half million people 57 biscuit factories, 137 woodware factories, 132 sheet metal works, 350 printing establishments, 1060 coach and motor works, 334 furniture factories, 71 boot factories, etc., etc., etc. I must confess I had to wipe my glasses and look again when you said that in New Zealand we have mainly a revenue producing tariff, not a protective one—surely your pen must have slipped. If this is so, then our Government have some queer ways of raising revenue. (At this stage I would like to step aside and point out how the raising of revenue has been shifted from income to tariffs. In 1921-22 the assessable incomes were £38,000,000, and from these was collected over £6,000,000 in revenue. In 1929 in spite of an increase of incomes to £65,000,000 the taxation had dropped to about £3,300,000). Let us proceed. You seem to base your main argument on what I claim to be a false foundation: “That it is impossible for our primary industry to absorb all the 60,000 unemployed.” If you agree to the motto of “Subsequent welfare, not wealth” the question is easily dealt with. Until every little child is taken out of the cowshed and given back his rightful heritage of hours of sleep and play, until every mother and expectant mother is relieved of the drudgery and evil of long hours in the shed you have no right to say that the land cannot find employment for thousands of our unemployed. Further, on every farm to-day there is abundance of work both current and developmental to keep an army of men at work. And all this without touching the question of closer settlement. In our district, which is good second-class land, when times weie normal quite a number were making a comfortable living on 100 acres or less, and I can show you that, even in our little corner by judicious subdivision room can be found for at least 20 families These families would not be settled on silly 10-acre blocks, but on good farms where they would have every chance under normal conditions, of making good. It is ridiculous to say that there is only room in New Zealand for the present 80,000 • farmers, but, of course, this leads on to the next phase—the question of outlet for our products. I think I have already shown that this depends on the restoration of purchasing power to “our greatly depressed urban proletariat” both here and in the Old Land and, so long as these are under-fed and under-clothed, there should be no fear and no bulk of overproduction. There are also, as you know, in the East millions of people living in a state of semi-starvation and there is therefore ample outlet for our produce to those lands, but again it is mainly a question of purchasing power. We in little New Zealand can hardly grasp the vastness of such a land as India, nor the fact that an increase wage of one rupee or about 1/6 per annum would give the people of India an increased purchasing power of £20,010,000 or a rupee a month increase (or 18/- per year) would amount to £240,000,000, or roughly enough to purchase five years of the output from New Zealand. And yet we know that, in all these Eastern lands the deliberate de-monetizing or deflation of their silver currency has robbed those people of any chance of lifting them and giving them a higher standard of living. Again the whole question depends upon monetary reform, and while other nations are adopting a policy of frozen isolation, there is no reason why we should not make towards closer unity and freer trade among ourselves. In conclusion, I would briefly summarize the position: (1) Our whole financial system or, at least our Empire financial system should be so reformed so that each citizen of the Empire would have the required purchasing power, to buy at least the necessities of life. (2) With this reform there would be ample outlet for every pound of butter, cheese and meat that we could produce for years to come.

(3) With the rectifying of “maldistribution” there would be no need for such absurd proposals as quotas

until all the people of the world were' fully fed and fully clothed. i (4) Throughout all this there would be a natural and ever-increasing demand for the products of our secondary industries Is not this the better way? )

These proposals are not the wild ramblings of a nonentity and I will close by quoting from a speaker at a meeting of the Royal Empire Society held 12 months ago. The speaker, after stressing the need for monetary reform, stated that “he was satisfied that there was a way out of our difficulties and referred to the proposals of the London Chamber of Commerce and other bodies as well as by individuals whose names were well-known. This main object was to convince them of the immense importance of monetary policy and of obtaining Empire agreement, failing international agreement. The danger of revolution could not be countered by “wait and see” monetary policy, but should be met by a definite and constructive policy backed by the leaders of industry and the sobriety of that great section of the public which abhors even the name of Bolshevism.” —I am, etc.

Our correspondent is in agreement with us in that he would do his utmost to relieve distress occasioned by the depression but his method of finding employment for the workless, nameljby “judicious subdivision” of land, is to our mind impracticable. We agree with our correspondent that the conditions under which some women and children work on farms is regrettable and we would readily exert any influence we posssess to improve matters. It must be admitted, however, that the Government has made every endeavour to give assistance to the primary producers and this has had our complete approval and support. It must be recognized that the primary industry cannot absorb the 60,000 unemployed and the hundreds of boys and girls who leave school each year. The aid of secondary industries will have to be invoked; hence our initial leader. No plea was made by us for the “bolstering up” of secondary industries by high protective tariffs. Our correspondent’s fears that our pen slipped when we stated that New Zealand had in the main a revenue-producing tariff are groundless. If he peruses Hansard he will find on many occasions that Ministers of the Crown have stated that the first object of the tariff was to produce revenue and its second object to give a moderate protection. It is obvious that a revenue-producing tariff must afford some protection but this is altogether different from a high protective tariff, such as that of Australia, which admittedly bolsters up secondaryindustries. Care has been taken in the imposition of tariffs in New Zealand to protect the production costs of the primary industries. Facts collected by the Department of Agriculture and checked and averaged by the Statistics Office disclose that in every £lOO of farming expenditure there cannot be 33 pence spent on tariffs. The many other questions raised by our correspondent such as the monetarj system and Imperial ties are important, but they seem to us subordinate to the pressing need of finding work for the unemployed of New Zealand. To enter into a discussion on these world-wide matters would but confuse the issue.—Ed. S.T.