A Visiting Economist

Southland Times, Issue 23438, 19 February 1938, Page 6

A Visiting Economist

The Leader of the Opposition (the Hon. Adam Hamilton) is justified in questioning the assessment of New Zealand’s national income which has been made by Mr Colin Clark, a British statistician, and which is reported in our news columns today. Mr Clarkais an economist of standing and his opinions deserve respect; but there is such wide disagreement —even among the world’s leading economists —on methods of computing national incomes that it is difficult to understand how he can feel himself competent to say, in such precise terms, that New Zealand’s national income last year “was” such-and-such a figure “almost exactly”, and to quote another figure for the current year, even though it is approximate, when only partial returns can be available to him. Many of Mr Clark’s conclusions are based directly on these figures, and it is to be hoped that he will take an early opportunity of explaining how his statistics have been arrived at. But there are other good reasons for questioning him. Mr Clark has himself been a candidate in the interests of the Labour Party at the last three parliamentary elections in Britain and, according to the 1938 Who’s Who, he is a “prospective candidate” for the next election. Some of his'remarks make it hard to believe that his observations of New Zealand and its present Administration have been made with the detached and dispassionate mind that is expected of a scientific worker. For instance, his statement that “the heavy rises in taxation revenue in recent years were simply due to the increasing national income” is only part of the truth. New taxes have been introduced in recent years, and—more recently still—rates of taxation have been substantially increased. Again, Mr Clark gives New Zealand credit for “bold departures” from the “old-fashioned, fatalistic outlook towards depressions” and says he thinks it will succeed, in facing the next depression “by the scientific control of banking and public works policy.” But he does not explain on what vast scale it will be necessary to frame a public works policy to combat depression when it has been necessary to spend a record amount of money on public works in a record year of prosperity. Statements like these, and his warm commendation of the Government’s “positive steps” to promote employment (what steps?) somewhat discount the value of Mr Clark’s statistical research into national income and taxation; but it will be interesting to have his further explanations.