The Daily News TUESDAY, FEBRUARY 24, 1931. FINANCIAL TIMIDITY.

Taranaki Daily News, 24 February 1931, Page 6

The Daily News TUESDAY, FEBRUARY 24, 1931. FINANCIAL TIMIDITY.

When, as was the ease last week, the London Stock Exchange passes through a very uncomfortable time, there are features in the financial situation that may well cause more or less anxiety, especially when the Labour Government has at last realised that a national crisis exists. At the same time it is pleasing to find there is in evidence that doggedness in the British race that supports the faith in the Old Country’s ability to “muddle through.” If it were only Britain that suffered from the present depression, optimism might well be justified, but it is the serious state of affairs throughout the world, and particularly in Australia, that complicates matters more surely than is generally taken into account. Those who have any approximate conception of the nature of the financial burdens imposed upon industry, commerce, and other activities in the Motherland can possibly envisage how the fear of further taxation would tend to create a panic, even if only unearned incomes were affected. Already such incomes, as well as the capital from which they are derived, have been greatly depleted by drastic taxation and death duties, and the latest pronouncement made by the Chancellor of the Exchequer, Mr. Snowden, appears to have sounded an alarm and brought about a heavy selling of gilt-edged securities on the Stock Exchange, thereby causing an appreciable fall in values. If, as was hoped, there had taken place a revival of industry and trade in Britain last year, there would have been available almost unlimited capital for stimulating the re-organisation of trade, industry and commerce, but unhappily world-wide conditions militated against all efforts in that direction. In the absence of a satisfactory condition of trade and industry that would attract capital for expansion there has been a tendency towards rash speculation, resulting in more losses. Such a state of affairs could not have existed in early Victorian times when there was no such thing as Labour unions or Labour Governments, neither did general strikes throttle industry. There may be differences of opinion regarding the causes which have acted to bring about the deplorable state of affairs throughout the world, but there ought to be something akin to a consensus of opinion that party politics and the entry of Labour into the political arena to contend for power must be to a large extent held responsible for still further smoothing the descent to Avernus. The latest news regarding Australian affairs is apparently of a more hopeful character in that it takes the form of a gesture against repudiation and an indication of good faith. It would certainly have been more welcome if the source wherefrom the Commonwealth was obtaining the money wherewith to honour her obligations had been disclosed. It is devoutly to be hoped that the last has been heard of repudiation. Sometimes it happens, when almost overwhelming difficulties arise and plunge a country into severe troubles, that it is necessary for affairs to get worse and “touch bottom” before a satisfactory recovery can be made, but it is almost hopeless to expect the work of reconstruction to be a success if orffihlialf of the country is struesgfeMHttdAt the other. The Commonwealth serious

handicap, more especially when there is mention made of possible secession. Much of such talk is nothing but “hot air,” but its effect is unsettling, if not dangerous. The responsible authorities in Australia will do well to heed the sensible advice tendered by the Statist, which remarks: “Though the construction part of the work of rehabilitation of Australia remains to be done, we can derive satisfaction from the check administered to the forces of destruction.” It may be considered that a check of such a nature should form a jumping-off place for a saner and wiser policy. The opportunity for reflection, is one that should be availed of, and, if rightly used-, should serve to banish timidity, restore confidence, and serve as a wholesome lesson, the fruits of which may be seen in a united Commonwealth, a chastened Labour Party, and an example of how a desperate position may be saved by sound and upright action worthy of British traditions.