A CALL TO THE DOMINION

Taranaki Daily News, 26 August 1930, Page 11

A CALL TO THE DOMINION

SIR O. ! NIEMEYER’S REPORT ' NEW ZEALAND FACES DANGER. MR. W. J. POLSON, M.P., IMPRESSED “If Sir Otto Niemeyer is right in his summing up, the position of the primary producer, not only in Australia but also in New Zealand, calls for immediate consideration and for statesmanship.” In these words the member for Stratford, Mr. W. J.' Polson, expressed yesterday' to a representative of the Taranaki Daily News his sense of the importance of the great London banker’s report on the economic condition of Australia. “Australia’s position is so serious that it must have an indirect effect on New Zealand,” said Mr. Polson. Public opinion cannot be too strongly directed to the necessity for profiting by Australia’s experience. ... Wq cannot, afrlord to drift a single hour. We have ito put our house in order forthwith.” , Australia, Mr. Polson pointed out, has a colossal publiq-debt, a, balance of imports over exports, and high, taxation. “What great difference exists,” he asked, “between her position and New Zealand’s? Let us face the facts. We are balancing our Budget by piling still higher taxation on this already overburdened, community instead of .attempting to- economise., Political courage, and :a strong policy are needed, if. we (are not; to,, be caught next, .year as. Australia has. been-caught this.-year. THE- FALLING.-PRICE LEVEL. . “Sir Otto 'Nibmeyer tells- us:—-’ ; “(1)- That’sbion" bis tlife’’ sheltered' trades of Australia insist updn taking-so-’lgrge 'a share of the national dividend?'the difficulties! of the 'uhslieltercd trades -arid'exports can’ only'increase. ‘‘(2) The I '-world’s price level is everywhere falling rapidly. It is likely to Continue falling? To this'Situation Aus-” tralia has not Adjusted . herself as regards either primary producers' or secondary produetioni; ; ’ ' , ,4 (3) The frill in- price levels means, apart 'from the increased burden of all’ debts, that (a) primary producers competing' in the world markets with Australia have a competitive advantage so long as the latter’s costs of’production are not reduced, and (b) Australian secondary industries must face fierce international competition, growing in intensity as the price level falls' unless the Australian secondary industries in turn are able to reduce costs.

“(4) Attempts by the secondary producer to meet this situation by increased production mean that his protection' is achieved at the cost of the primary producer. “(5) The situation is rendered worse than even these arguments imply, and the fact that there is reason to fear that the price of these', particular products in which Austfrilia' aS exporter is primarily interested will decline more rabidly than tho'general price level. “(6) Finally .Sir. Otto Niemeyer declares that the standard of living has reached a point economically beyond the capacity of the country to bear, and that wages must fall before relief can be hoped for. THE' UNECONOMIC TAX BURDEN' “This dark picture of Australia’s position may not interest thoughtless people, but can anyone say that the situation in New Zealand is very much better or likely to improve under a policy of piling up costs through the tariff and adding to a tax burden that is already uneconomic in its severity? Drastic and far-reaching economies are called for, . This' is a country which exports nothing but primary products. We cannot live for ever on our fat. We have to export, and maintain a balance of exports , over imports that will pay our -overseas interest-bill if we are to retain a sound position.'

. “What will - happen to primary production in this country if Sir Otto Niemeyer is 'right dnd the- world’s ■ prices arc going to continue falling? The primary producing goose 'cannot -continue to lay golden eggs much longer. Costs- will 'annihilate 'tho •'■unfortunate anserine -slave. When that 'begins to happen nothing- will save New Zealand from a Catastrophe • not experienced since the sixties? - '•

“We are 1 caught in the cogs of a political machine, which’ we cannot control, or Parliament-.might set about improving the situation. No party has the backing- to’ adopt radical remedies; the marty'- spirit is too strong. What would happen.'to the Government if it announced its intention- of bringing down all wages and salaries by 10 or 20 per cent.‘by Act of Parliament? The Government dare not -even- say it is going to reduce the wages of single men on relief works. . It caririot even tackle the job of reducing living'costs through the tariff and putting” the substitute taxes on the shoulders of luxury users. "Yet we must’ apply'“these remedies, however unpalatable, or suffer worse results, and the sooner the country -wakes up to the fact and insists upon its ‘rulers’ acting iiistead of .talking, the more lightly shall we escape Aiis-tralia’s-'fate.”