Hurt Australia

Sun (Auckland), Volume IV, Issue 1074, 11 September 1930, Page 9

Hurt Australia

MR. W. M. HUGHES ATTACKED Credit Damaged Abroad CRITIC CALLS HIM EXTINCT VOLCANO FOIi describing Australia’s economy crusade as “a policy of despair,” Mr. W. M. Hughes has been attacked in Australia and also from London. England might take him seriously, a critic says, if he were not an “extinct volcano.” All the Australian States show a deficit, but the rigid curtailment of expenditure is already leaving its mark.

United P.A.—By Telegraph—Copyright Rec.d. 10.10 a.m. SYDNEY, Today. “His remarks are utterly unworthy of a man who has been Prime Minister of the Commonwealth, and are likely to have a serious effect upon Australia’s credit in London,” commented the New South Wales State Premier, Mr. T. R. Bavin, upon the statement made by Mr. W. M. Hughes last week. Mr. Bavin emphasised that there was no truth in Mr. Hughes’s suggestion that Sir Otto Niemeyer had attempted to dictate Australia’s financial policy. On the contrary Sir Otto came here by invitation to tender

expert advice as an impartial outsider. Unfortunately much more significance would be attached to Mr. Hughes’s remarks in England than they deserved. Most people were not aware that he was a spent force in the Commonwealth. The London “Times,” in an editorial article, hotly attacks Mr. W. M. Hughes for his recent speech, which, it says, might be taken more seriously if he were not an “extinct volcano.” The article describes the speech as sponsoring the most pernicious features of Australia’s economic life, ft proceeds:—

“We regret that the Federal Government has for the moment adopted what seems to be a hesitating attitude about a reduction in the standard of living. Any postponement of the necessary measures cannot fail to exercise an unfavourable influence ou Australia’s credit.” ADVERSE BALANCE STILL In view of the Imperial and Economic Conferences, the British council of the Australian Association of British Manufacturers, through its chairman, Sir Arthur Balfour, has sent a memorandum to Mr. J. H. Thomas, Secretary of State for the Dominions, emphasising the grave effect of the present economic situation in Australia upon British trade, and submitting suggestions. The first of the financial reports of the Federal Government as agreed apo-n at the recent Premiers’ Conference was issued today. It shows that for the two months ended August ”1 there was an excess of expenditure over revenue of £2,259,000. However, as many items of revenue are seasonable, notably the land-tax and the income-tax, and necessarily are small they do not give an actual idea of what the returns will be at the end of the year.

STATE FINANCES IMPROVEMENT IN N.S.W. FURTHER ECONOMY URGED Reed. 10.25 a.m. SYDNEY, Today. The financial report of the NewSouth Wales Government for the first two months of the financial year shows a decrease in revenue of £ 1,196,185. compared with the corresponding period last year. Railways and tramways were responsible for a large proportion of this amount. The decrease in expenditure was £560,426. The State Treasurer, Mr. B. S.

Stevens, stated that, notwithstanding the decline in revenue, which had been expected, the position was well in hand, and provided they continued to exercise the same degree of economy as had already been practised, there was no reason why the ledger should not be balanced by the end of the year. The revenue for the State of Queensland for the first two months of the financial year was £1,920,45*3, the deficit being £218,606. In South Australia the revenue and expenditure return for the two months shows a deficit of £646,259. The West Australian shortage for the two months totalled £565,896. The Tasmanian deficit at the end of August was £29,882. The total debit balance is now £259,470, including the debit of £229,588 on June 30.

WHAT MR. HUGHES SAID “POLICY OF STAGNATION” GREATER CONSUMPTION NEEDED The statement over which this heated controversy has been aroused was made by Mr. W. M. Hughes last week, when he alleged that the policy as advocated by Sir Otto Niemeyer would. lead to stagnation and despair. It was a smoke screen, he said, to stampede Australia into a compound where the financial interests Sir Otto represented wanted her—a plot to make us concentrate on the cheapest possible production of raw materials for British industry—so that Britain will be able to compete in the markets of the world. “What Sir Otto did not mention,” declared Mr. Hughes, “is that Britain has many times lent money to nations which have defaulted. She has lent freely to the dairy interests of Soviet Btissia, Latvia, Esthonia and Argentina, in order to depress the price of Australian and New Zealand butter on British markets. There is plenty of money for these, but for Australia, which spent millions helping Britain in the war, and which is her best customer, next to India, not one penny. WORLD OVER-PRODUCTION “The present troubles of the world are due to over-production. The price of wool has already fallen 40 per cent. To produce more wool would be fatal to our great pastoral industry. “If we were, to concentrate on the production of raw material, barely one-half of the present population would find employment, even if living standards were reduced below those of Britain.” Mr. Hughes says there would be dangerous effects of a reduction in present living standards. Property values would fall, spelling disaster to the most thrifty and deserving people in the community, and ruin would face such industries as dairying, dried fruits and sugar, which were able to sell their surplus abroad at world prices only because of a higher charge to the Australian consumer. NO CHEAPER LABOUR “The ruin of the sugar industry would mean the depopulation of North Queensland by the white races and the beginning of the end of our White Australia policy. Reduction in the consuming power of one country reacts upon ail, so that the new level of wages would eventually be as unstable as the old. Our only hope lies in increased consumption in Australia. Manufacturing industries alone can effect that. “What we need is not cheaper labour, but cheaper land, cheaper money for industry, more efficient methods, and an ever-increasing home market. Industry, now half paralysed with fear, must pluck up courage. Employment can be found for tens of thousands in producing the goods the community wants. The trouble is that we have swung from one extreme to another.”