STATE BANKS.

Taranaki Daily News, 8 October 1929, Page 8

STATE BANKS.

Labour politicians in New Zealand who gee in the establishment of a State bank the easy way to prosperity for all, and who maintain that present banking facilities and methods are responsible for the growth of unemployment, should take heed of a recent utterance of the British Chancellor of the Exchequer, Mr. P. Snowden. There is no question in regard to his political beliefs, for he has been an ardent champion of sane Labour ever since he entered public life. In the ranks of British Labour there are those who desire “national control of currency and finance,” a high sounding phrase of which Labour orators are singularly careful not to translate into plainer language, and explain just what national control would mean, and how it could be brought about. Mr. Snowden, in his capacity of British Minister of Finance, realises the absurdity of such suggestions, and has said so very plainly. The occasion of his remarks was a discussion at the annual conference of the Labour party at which criticism was directed against the Bank of England for raising the bank rate. Mr. Snowden practically told the conference not to make itself look ridiculous by criticising matters of which it knew very little. Not only was the bank not to blame, but it had delayed as long as possible an action that was inevitable if the drain on British finance was to be arrested. Moreover, the raising of the bank rate had had the desired effect. Foreign exchanges were now in Britain’s favour while the effect of the rise on British funds was negligible. The Minister closed his statement with the remark that it was absurd to attribute unemployment to the rise in the bank rate or to any other individual cause. Mr. Snowden’s plain speaking had the effect of preventing a socialist resolution in favour of “national control of currency and banking finance” being brought before the conference, and it is possible that the testimony of one of its own leaders may have a wholesome effect upon the party generally. Were a Labour ministry in office in this country, it would soon be forced to the same conclusion that Mr. Snowden has reached, namely, that banking and finance are delicate operations, only to be entrusted to experts. Their efficient management is essential to the solvency of any country, and to allow any political considerations to influence that management is to court national disaster.