The Daily News. MONDAY, JUNE 13, 1921. RAIDING CAPITAL.

Taranaki Daily News, 13 June 1921, Page 4

The Daily News. MONDAY, JUNE 13, 1921. RAIDING CAPITAL.

The proposal of the Labor Party to raid capital in order to solve the problem of unemployment is exactly what might be expected to emanate from such a source. “Down with the "capitalists,” is the battle cry of the Socialistic section of the Labor Party, just as it was with the Bolsheviks, hut Lenin and Trotsky, after strenuous efforts to carry out this mad policy, have been (compelled to abandon it, and to recognise that capitalists are as necessary to the welfare of a country as is labor. In the realm of industry, capitalists exercise much the same function as does motive power in mechanics, and the recognition of this fact will alone open the eyes of the despoilers to the necessity for readjusting their views on capital and labor so as to enable them to see that it is only by the harmonious co-operation of both parties that there can be evolved a satisfactory foundation on which the general welfare of the people ean be secured. If these were primitive times, and Labor possessed the requisite strength and daring, the tactics of the cave-men would have been set in motion, and in the present day Labor does not hesitate to adopt coercion, but though it may injure the capitalists—and the community generally—it cannot seize the capital; so it is forced to fall back on constitutional means and endeavor to make Parliament the raiding power. At the recent meeting of representatives of Labor, the proposal put forward for remedying unemployment took the shape of a levy on all capital in excess of three thousand pounds owned by any individual, and to utilise the money thus obtained for carrying out public works, as well as for subsidising local bodies for the same purpose, also the building of workers’ homes. Putting aside, for the moment, the immorality of such an iniquitous proposition, and regarding it as an fact, what would be the result? Every industry, as well as all business establishments and trading concerns, except small shopkeepers, would have to close down for lack of funds with which to carry on, while the employees would either have to depend on earning a subsistence on public works (for which they are totally unfitted), or swell the ranks of the unemployed and become a charge on a bankrupt nation —for bankruptcy must inevitably follow. Had the proposal been in the direction of compelling the banks to hand over to the Government all fixed and other deposits, together with the surplus of all current accounts over £3OOO, it could not have been more absurd. This levy on capital question is not a new one; it has been thproughly threshed out, only to be condemned as absolutely impolitic, impracticable, and unworthy of further thought. The complicated machinery of modern finance is so delicately adjusted that it is easily put out of gear, and when that happens grave trouble and probably disaster are inevitable. Labor extremists must be lamentably ignorant of the principles concerning financial stability when they voice a proposal that would undermine the whole economic and financial fabric and intensify an evil that has already reached acute proportions. Even assuming that Labor’s scheme is to raid only unemployed capitalists in order to benefit unemployed workers, it is equally prepos-

terous, for it is by such capital that industry is fostered. Even the money of successful speculators may find its way to the banks and financial institutions, and it. is utilised in advances to traders and industrialists, so that a raid on this capital would be as disastrous as any other legalised depredation on other, people’s money, besides which, if the idle eapital-

jiiiwere forced to become workers, they would lessen the chances •of the (latter of earning a living, jgd w ike xieious sircle would set

and react in much the same way as the effect that continuous rises of wages has had on the cost of living. A moment’s oonsideration should convince the workers that the colossal cost of the war was all unproductive expenditure—money absolutely lost, except as to wages and profits—hence the shortage of capital, the financial stringency, and the need for the utmost economy as well as of effort to restore the equilibrium by greater production. It is easy for Labor to place the onus of this restoration on the capitalists—or employers—but Labor must bear its share of the task, or suffer the consequences. If there is to be a solution of the unemployment problem it ean only be evolved by a co-operative effort of employers and employed, the former being content with less profit, and the latter with reduced wages or 'greater output. Only by mutual and universal sacrifices ean the present difficult state z>f affairs be remedied. It is puerile to charge the Government with forcing down the rate of wages and the standard of living of the workers. The position is so plain that it ean be read by those who run. The world is faced with abnormal conditions that require most careful treatment if a dire calamity is to he averted. To attempt, to remedy affairs as they exist to-day by piling up trouble for to-morrow would be a suicidal policy. Labor may be credited with possessing the knowledge of what would be the real, effective remedy, but the medicine is evidently unpalatable.