STATE CONTROL OF RESERVE BANK

Southland Times, Issue 23948, 14 October 1939, Page 4

STATE CONTROL OF RESERVE BANK

USE OF NATION’S CREDIT

One of the most important pieces of legislation passed during the recent session of Parliament was the Reserve Bank Amendment Act, said Mr W. M. C. Denham, M.P., in an address at the monthly meeting of the Invercargill branch of the Labour Party. It provided the Government with the power to use to the full the nation’s credit vdthout resorting to the usual way of raising loans from private investors or increasing taxation.

“What is there to stop the Government from supplying its own finance from it*- own bank . against its own credit, the real credit of New Zealand,’’ asked Mr Denham. “What does the credit of the Dominion really consjst of? It is the country’s ability to produce goods and services. It is not the gold we possess, but the goods we are capable of producing that are the basis on which money-should be made available. “Financial credit is essentially a national property and should not be handed over to the banks, which will charge us for the use of our own property. Do not be alarmed by those who say that the Government is eburting financial disaster by inflation. This is mischievous nonsense.” At the conclusion of his address Mr Denham was warmly applauded and a vote of thanks was passed.