The Southland Times. PUBLISHED EVERY MORNING. “Luceo Non Uro.” WEDNESDAY, AUGUST 14, 1935. THE FARMER’S POSITION

Southland Times, Issue 25362, 14 August 1935, Page 6

The Southland Times. PUBLISHED EVERY MORNING. “Luceo Non Uro.” WEDNESDAY, AUGUST 14, 1935. THE FARMER’S POSITION

Much that Mr Batchelor says in criticism of our references to the high exchange policy is quite beside the point; but there are two statements on which it is necessary to correct him. At no time did we say that the high exchange policy lowered production costs for the farmer. We stated that when the exchange rate was raised it was part of a programme which included the reduction of the cost of production. In other words at the time the raising of the exchange rate was urged by the economists called in to advise the Government, a lowering of the costs of production was advised and this was carried into effect in various ways. It is admitted that the high exchange gives a subsidy to exporters, and to say that the farming community received no benefit from it is to talk nonsense. Better prices can be given in New Zealand for primary products for export because the yield is greater as a result of the high exchange, and if the prices are not satisfactory the fault is not to be ascribed to the high exchange but to the condition of the market. Reduce the exchange to par and the farmer would feel the effect at once. So far as the accumulated sterling is concerned, will our correspondent say that it is not an asset behind the notes issued by the Reserve Bank to the trading banks to the same amount? Mr Batcheler scouts the possibility of the British market improving, and he puts forward the advance of British agriculture as the reason. Yet the terms of the agreement made by Mr Coates suggest that there will be no immediate reduction in the quantities of New Zealand produce taken by the Old Country, while the British statistical returns show that there has been a decrease in unemployment, and the commercial and financial institutions announce that the improvement in the trading position continues. American observers comment favourably, even enviously, on the revival of Britain’s trade, and as they base their statements on statistical information from reliable sources, Mr Batcheler cannot expect us to accept in preference to them his unsupported assertions to the contrary.