FUNCTIONS OF THE STATE

Taranaki Daily News, 3 May 1933, Page 8

FUNCTIONS OF THE STATE

HAMPERING OF ENTERPRISE. CHAMBER OF COMMERCE ADDRESS. The functions of a Government were the subject of an address in Hawera on Monday by Mr. A. O. Heany, organising secretary of the Associated Chambers of Commerce. Mr. Heany contended that the greater part of State interference in private enterprise had no result but to hamper industry. . One of New Zealand's greatest troubles, said Mr. Heany, was the rooted belief of thousands, instilled by two generations of “spoon-feeding,” that deliverance lay in State action. The powers that democracy held through the State found them rather hypnotised and deluded. The inhabitants of New Zealand had looked to the State for loans, subsidies, grants and concessions. They had expected the State to guarantee profits and to make up losses. They had asked the State to take the initiative and to protect them. They had looked to the State to provide services, pensions and charitable aid. They had used the machinery of State in attempts to win wealth and comfort by an easy road. In fact, they had invoked the State as if it were a genie of the lamp with endless resources. , . Not unnaturally, the personal effort and personal pride of the individual had suffered an eclipse. It was in keeping with their condition that they should watch the State, th,us encouraged, set to work in the realm of trade, industry and commerce, take tried principles and methods by the ears, and try to turn economic forces upside down in an endeavour to avoid the play of natural laws. They had assented to industrial legislation that sought to give workers more than there was to have from trade and industry. They had denounced private profits and suppressed competition with the misplaced idea that these wei e ■ undesirable things. They had reared taxfree .public trading concerns and curtailed the avenues of employment by private enterprise. People had hailed legislation which gave them something at the expense of somebody else. They had acquiesced in loading up private business with all manner of prohibitions, regulations and restrictions. What they had failed to see in their collective interference through Parliament was that they had been using as their chopping block the whole structure built up by. the personal ability of private, individuals, and that they had been, making ever smaller the field within which private effort could produce wealth for the people as a whole. LOSS TO PRIVATE ENTERPRISE. It might appear a good thing, for instance, for the State to carry out its own public works, but by its so doing private enterprise lost that work. Private enterprise in that industry was therefore unable to provide employment for the people, as it could do on a much sounder basis than the State, which could spend what it liked on its own work because no outsiders had it between them to compete" over the price at. which it should be done. Furthermore, the State lost taxation revenue from those private contractors, and the burden of taxes fell on a smaller number of people. In these troublous times particularly people should not look to Parliament as an institution to get them out of their difficulties. They should remember that the State was a negative force and that the worth of a State was the worth of the individuals composing it. They must get back to individual effort, enterprise and resource, which was the source whence national well-being in the sphere of material wealth sprang. If they had difficulties they should face them, instead of invoking the genie of the lamp to show a way of temporary escape. Private effort could not meet the storm when the State, as an over-zealous guardian, nailed up the door. They needed protection of property and of lawful citizens, justice properlyadministered, and education and public health facilities, and in matters of this kind the State was of useful and essential service. But because the State had unlimited powers over its nationals, it did not mean that it had the power in itself to create wealth. It could restrict and restrain and prohibit, but it was powerless to ensure that, under the conditions it imposed, the production of wealth by private hands should go on as before. This. was so because it was private effort and incentive that produced wealth, and by far the greatest part of the interference by the State in private enterprise had no result but to hamper and impair the processes of wealth, production. It was necessary for the State to guard the people against abuses, fraud and malpractice, but even then not in a manner to penalise the worthy with the . unworthy. Generally speaking, the wheels of trade and employment slowed up in direct ratio to the accumulation of trade laws, affecting private enterprise. Chambers of Commerce were composed of men who, by their personal efforts and ability, as well as by those qualities in others associated with them, had built up businesses from the operation, of which the whole community benefited. The' knew, perhaps from a life-time of study and experience, that they were far more capable of conducting their business than politicians or bureaucrats with .a small fraction of the knowledge. Consequently, when the State, through Parliament, took some action that was going to restrict further the operation of private enterprise in trade and to curtail personal liberty the protest that they made was on sound lines. When Chambers of Commerce offered a Government advice on these lines not only were they speaking on behalf of existing private interests, but they were upholding on behalf of the whole community the principle of individual competitive enterprise as opposed to the deadly levelling of the State. It was a principle that reached out to a generation yet to come. For that reason, chambers of commerce should allow no occasional charge against them of resisting so-called social progress, to deter them from steadfastly adhering to the principle of private enterprise, the maintenance of which alone could save the Dominion from the dominance of the State and the miserable mediocrity of Socialism.

When troubles arose from the abuse of a principle was there not, asked Mr. F. W. Horner, a tendency to recoil from that principle which in itself might be perfectly good? Was there not a happy medium to be pursued? The same thing applied to the vexed question of orders* in-council. They realised the value of the postal service. There were certain aspects into which the Government must go to protect the majority against the minority which was often .the monopolist or exploiter. The Government Life Insurance Office, for example, had brought down premiums. He thought, however, that all public bodies should work on the same accounting system ahd pay the same taxation as private business. Excursions into business should be viewed with caution.

As a member of Parliament Mr. H. G. Dickie said it was refreshing to hear Mr. Heaney. They knew that they needed to be saved from democracy. He did not altogether agree with Mr. Heaney’s comments on stock remedies as this restriction also applied to human medicines but he admitted it had been carried too fat.