The Sun 42 WYNDHAM STREET AUCKLAND MONDAY, JUNE 2, 1930 THRIFT OR DRIFT ?

Sun (Auckland), Volume IV, Issue 987, 2 June 1930, Page 10

The Sun 42 WYNDHAM STREET AUCKLAND MONDAY, JUNE 2, 1930 THRIFT OR DRIFT ?

THIS seems to be the question of the day. It is for the State on its political side and for the people who suffer from puerile politics to provide an answer. They have their choice and must make it with courage and intelligence or, if the roaring pessimists are to be believed, become possessed with the seven devils of extravagance and, following Australia, rush headlong down a Gadarene slope of slippery finance into a deep sea of debt and depression.

Such, at any rate, is the fearsome picture that has been painted darkly by the Prime Minister, who is being lauded for his dismal work of financial art. Here and there only a few commentators have refused to accept him as a competent artist, and condemn, instead of cheering him for the bleakest and most mischievous production any Minister of Finance in this country has ever brought out of his own head or the heads of his departmental advisers. This journal is among those few critics who decline to applaud a lugubrious masterpiece. Although the Dominion’s financial position is anything but good, and has become worse under the worst Government the country has had foisted upon it for many years, things are not yet had enough to compel the people “to sit down by the rivers of Babylon and weep.”

In all probability, before the effects of the Prime Minister’s first statement as national treasurer have been dispelled by material proof of better results than he, in his raw knowledge of finance, could envisage, Honest George Forbes will have been given a different sobriquet. Still, let everybody for the moment hail him as a political Jeremiah and look upon his lamentations as gospel truth. It is almost certain, of course, that when the Minister of Finance goes into the London money market for a substantial loan largely to pay the interest on former borrowings he will not present *o potential investors his sombre picture as a prospectus, hopeful of being praised for making an excellent start with a bold, lucid exposition of New Zealand’s financial difficulties. If he does there will be no necessity for rationing the investments among a multitude of avid applicants. That, however, is a hurdle of his own construction for the future. In the meantime, it is his duty to expand his courage and frankness in the direction of making thrift take the place of drift. And if there is tuppence worth of political courage in the reconstituted United Administration and severely depleted party, there will not be a deficit of £3,000,000 this yiar.

A Wellington man of business with wide experience of financial affairs generally and taxation in particular has been pleased to appear, as he himself puts it, an extreme pessimist. In an exercise of the worst sort of pessimism Mr. George Shirtcliff e points out that the Dominion lias been going to the bad at the rate of £5,000,000 a year for nine years, that the country is drifting financially to a position similar to that already reached by Australia, and also that it looks as if the community as a whole is living beyond its means. But is it really necessary even to sug'gest that unless some master-stroke of political economy he effected without delay New Zealand will be compelled to take drastic steps to save its credit overseas?

- Let us all admit frankly that there is need of rigorous economy in this spendthrift country. It does not follow, however. and should not be permitted to follow, that, in order to secure the practice of thrift, there should he talk of cutting down wages, lowering the standard- of living, arresting commercial enterprise and seriously damaging business,, and increasing taxation in the old stupid political belief that more revenue for the State makes an end to every economic ill. If Mr. Forbes really had the right kind of political courage he would have begun his career with an announcement of a million pounds decrease in taxation. That is what is wanted first as the best aid to private enterprise and national optimism. Then the Government should set an essential example of economy by clearly realising that State expenditure since the war has increased by Pearly 170 per cent., and by courageously'resolving to cut it down. Courage in pessimism? Mr. Forbes will have to show more courage in the United Government’s politics.