THE TARIFF POLICY

Taranaki Daily News, 23 November 1932, Page 12

THE TARIFF POLICY

FARMERS’ UNION VIEWS “REVENUE PURPOSES ONLY.” TEMPORARY AID TO INDUSTRY. The tariff policy of the New Zealand Farmers’ Union is set out in a statement issued by the Doriiinion president of the union, Mr. W. J. Polson. He states that as the tariff question will loom clearly on the business and political horizons during the next two or three months, he is taking the opportunity of placing before the public the attitude of the Farmers’ Union on this important matter.

“The policy of the Farmers’ Union on the tariff question is one that admits of no compromise,” says the statement. “Within the bounds of what is practicable it advocates the abolition of all tariff duties excepfc those imposed' for revenue • purposes only. On this point our platform is quite explicit, as one clause reads: ‘That taxation through the customs shall be. for the purpose o£ raising revenue, and not for protective purposes.’ We believe that a policy of industrial protection is not only against the public interest, but in the long run detrimental to sound industrial development itself, and we think that many instances in our own industrial history can be cited in support of this contention. If an established industry cannot stand unless continually supported by tire artificial scaffolding of a protective tariff, then it is an unsound structure and not worth having at all.

“We take the view that the national labour and capital should be applied to our natural resources in directions where the result will be an asset to the community, and a source of industrial strength, and not weakness. If under reasonable conditions an industry cannot stand on its own feet without a tariff, then, since obviously you cannot get something out of nothing, some section of the community, the consumers as a whole, is being taxed to support it.

NO SCOPE FOR MASS PRODUCTION. “Such an industry is not a national asset; it is a running drain on our economic strength in a period when it. is essential to husband our resources to the utmost. We should aim to establish such industries as can pay their way, those that are natural to our circumstances, and exchange the surplus products of mass industrial production that we need, and which cannot be produced here on a self-supporting basis. “It is generally admitted that mass production of manufactured articles is not possible in New Zealand. Our domestic market is too small to absorb the produce of one great mass producing industrial plant, and we could not produce at the point of maximum efficiency and cheapness. To make for ourselves the products of mass production on a small and expensive scale is ruinously wasteful. For good or ill, we think for good, we are definitely committed in the national interests to a policy of importing mass produced 'commodities in exchange for the surplus of our primary production. This is the foundation on which we have built, and on which we must continue to build. To try any other policy now means industrial disaster. SHELTERING NEW INDUSTRIES. “We recognise that this policy cannot be implemented in a day. We have first to undo the mischief of the past. We do not suggest that all protective tariffs should be immediately and totally repealed, but we do contend that such tariffs should at once be revised in a downward direction, and gradually eliminated over a period of years, and we think that a start should be made at once. 1

“The only justification for industrial protection is th shelter an infant industry in its initial stages. After the industry has been operated for some years it ceases to be an ‘infant,’ and if it cannot then stand on its own feet, this fact in itself is a proof of the unwisdom and waste of protecting it by tariff duties. In such cases protection should be withdrawn in a series of steps. The Tariff Commission that reported to the Government of the day in 1921 was explicit on this point. It said that protection should be regarded as temporary, as withdrawable after due notice, and as being conceded strictly for the infantile period of industrial development. I THE WHEAT DUTIES. “-r I “No industry or individual has a vested interest in any particular tariff, or in any form or rate of taxation, and this should be plainly recognised. Unless an industry can grow out of the stage when it needs a tariff it is not a fit object for protection at all. Haphazard protection has loaded us with I a heavy tariff, raised the cost of living, added to our present difficulties, and failed in its ostensible object. ‘As regards the wheat duties, which are often pointed to as evidence of our inconsistency, they are merely a necessary counter-balance to the burden of tariff protection, and farmers generally would approve of their abolition if the same treatment were accorded to other forms of industrial protection. They are not defended in themselves, and should be eliminated as and when protection tariffs are removed from other industries as well.”