LOWER INTEREST RATES

Taranaki Daily News, 13 February 1931, Page 9

LOWER INTEREST RATES

remedy for depression

LABOUR REPRESENTATIVES’ IDEA

REDUCTION OF WAGES OPPOSED.

By Telegraph.—Press Assoeiatidn. Wellington, Last Night. A strong protest against any proposal to reduce wages was made to-day by a deputation from the Wellington Trades and Labour Council to the Rt. Hon, G. W. Forbes. In introducing the deputation Mr. W. Nash, M-P-, *aid if wages were reduced the problem would be just as great as before. The chief reason for the crisis wap because production had outrun consumption. Reduction of wages would only further decrease consumption, Mr. J. Tucker, secretary of the Storemen’s Union, said they appreciated the task that faced the Government and were afraid the Government might listen to the monied and propertied class to the detriment of the workers. .If the Government gave the Arbitration Court power to reduce wages it would amoufit to a breach of contract with the workers and would be as bad, if not worse, than repudiation of the national debt. Any reduction of wages should be on the cost of living basis. That basis had been good enough when prices were soaring and should be good enough under present conditions. Mr. W. Maffdison, of the Carpenters’ and Joiners’ Union, said falling wages adversely affected the state of commerce more than any other economic phenomenon. The firmer would benefit very little from wage reduction in the secondary industries as the reduction would be so small it would not ba passed on. In addition much of tha farmers’ products could not be exported, and if wages came down he would have to face a smaller home market. The farmer’s real difficulty was due to heavy interest charges consequent on inflated land values. The Government should see that 1 per cent, of interest over 6 per cent, was placed in a pool for the purpose of relieving in difficulties. There was over £30,000,000 worth of mortgages; in New Zealand, and if the Government took the action suggested land values would .be deflated? The condition of the country could be met by other means than wage, reduction, but in the event of the Government deciding to reduce wages interest and rent should be reduced also so that the present standard of living could be maintained. They also asked . that wheat prices be brought into line with the world parity. Mr. A. Parlane, secretary of the Drivers’ Union, said the workers considered any wage reductions would be most unreasonable. Workers had suffered reductions during some of the most prosperous years the country had had. The Prime Minister said reduction of wages >vas undoubtedly ,a serious Matter, but he wanted them to understand hi position. Ever since he took office he had been faced with the necessity of balancing the Budget. Some little time ago he > made a statement that if they continued on the why they were aoinrr they vould be faced with a de; ficit°of £3,000,000, and since then there had been a further serious drop in the prices of' produce. As a result the farmer wag right up against it, and it was very probable many people who had invested all their savings in broad, acres, once a very safe security, would not receive their interest. Manufacturers, too, were feeling the pinch; in <ict, he did not think there was one section of the community that was not feeling the economic pressure. It was no use saying the country could go on in th? same old way; some adjustment was absolutely essential. The whole matter was fraught with, difficulty, and he was calling Parliament'together to thrash’it out and endeavour to reach a solution. While he ..wa* Prime Minister he recognised it was his responsibility to suggest means of overcoming the difficulty, and he intended to accept the responsibility. He intended to maintain the finances of the country in a sound position and to balance the Budget. He wanted to make it plain that in reaching this decision lie was not swayed by any section of th community. He had heard the case presented by "the farmers and the etn- “ ployers generally, and before making any pronouncement he wanted to hear the case of the workers. He had, now had that opportunity and would decide Upon," a course. The Government would take that course which would be fair to all.