THE ECONOMIC COLLAPSE

Taranaki Daily News, 13 September 1934, Page 6

THE ECONOMIC COLLAPSE

RESTRICTING PRODUCTION CONDEMNED BY COLONEL CLOSEY. PROPOSALS OF SOCIAL CREDIT. An address on Douglas social credit was given by Col. S. J. Closey, M.C., V.D., at Eltham on Tuesday night. Mr. J. Penhall presided over a small attendance. The speaker said that even 100 years ago economists foresaw a collapse of the financial system, while in 1856 Professor Sedgwick very nearly came upon the problem. The process of industrial expansion had been accelerated during the war when the world produced more, though 30,000,000 men were engaged in fighting each other, than ever it had done before. At the present time there was 2£ years’ supply of commodities in stock. Major Douglas made the discovery that not one industry could sell all the goods it produced, and that in all cases the credit for purchasing came through the banks. According to a League of Nations survey there was no sign of economic recovery, and Major Douglas had set out a cure. He said nations would always be fighting each other unless they could buy the surplus of their products or exchanged this with some other nation. Efforts were being made to create a scarcity in order to raise prices. But this policy was a ghastly failure, owing to other nations setting in to increase production by means of subsidies. Even the restrictions in products had only resulted, in prices going lower still, and the world had discovered that this was wrong. Destroying commodities would not lift prices. The people had to be given purchasing power. EUROPEAN DETERMINATION. The West would not let the East work and would not give its peoples food. Europeans were determined, apparently, to deny these peoples food stuffs and to restrict production, which he characterised as a crime against humanity. The scheme of restriction was a method which the world now knew to be wrong and was being introduced gradually to get the people used to it. A community could not earn more than it spent. The very economy that Government departments practised had its repercussion in many ways and in no way was there any increase in wealth as the result. He could not see what good could come from curtailing services and production. There was hardly one nation in the world that was seriously contemplating paying its war debts, yet it was held that the war debts were the trouble. It was nothing to do with the war debts. General criticism of the wastage of labour under the relief system was voiced by the speaker, who said that this could be ended by giving the people the money to buy goods with and the unemployed would soon be re-established n jobs making the things that were finding a sale. While banking institutions lent money for production purposes they did not advance it for encouraging consumption, and the only way was to get control of the money Care would be taken, under the Douglas plan, that the money issued would be used for buying and not hoarded and it would be made available in the form of a discount People said this system was too good to be true, and they had to set out to convince them. In reply to a question as to whether there would ,be an increase in prices as the result of social credit Col. Closey held that it would be possible to see that monopolies did not spring up to charge too much. The position, however, would have to be watched and any business that forced up prices would be deprived of tiie discount and put out of business. PERISHABLE COMMODITIES. Mr. Ricketts asked whether in the case of credits issued against bread and meat, which were perishable commodities, there would not be an amount of money which was unrepresented by goods. Col. Closey replied that the discount would be issued against the whole of the New Zealand balance, and if it were found inconvenient to calculate it against one commodity another could be selected. Mr. W. Lelirke asked if there was not sufficient money in the country already and was it not in too few hands. Col. Closey said this was the problem of the sociologist and it was not the concern of the financial reformer. There was a great deal in what the questioner said, and the disparity in. New Zealand between the highest and lowest paid was very great, but a more even distribution would have to be done by a political method. Although many were inclined to think there was need for some readjustment it was the control of credit that hid given the financiers their advantage. What was wanted was not more for some but more for . all. The speaker explained the methods of replacing credit power should it be hoarded or cornered so that this power was destroyed and there would be no reason for a speculator to hoard money as it would not bestow the advantage that it had done in the past. Mr. Ricketts asked if Douglas credit would solve the vicious mortgage system. Col. Closey referred to the apparent values of land and produce of the period of a few years ago and said the people were not aware that the value of their money was moving. He titought the control of credit would enable a steadier range of values. Under the new system there would not be such tendency to create foolish mortgage values. Asked by Mr. Peebles if it was necessary to borrow money from overseas under social credit, Col. Closey considered there would be little need to go overseas foi’ loans and he held that the load of debt on the nations was condemnation of the present financial system. He believed that the present national debts should be met as the world was based on contracts, but a tribunal would have to determine the currency value of the money borrowed. Mr. H. Finlay president of the South Taranaki council suggested the formation of a branch at Eltham and mentioned that the movement was flourishing in other parts of New Zealand. A vote of thanks was accorded the speaker and afterwards a social credit group was formed, Mr. H. Jenkins being appointed secretary. ELTHAM TALKIE THEATRE. “DAVID HARUM” SHOWS TO-NIGHT Patrons of the Eltham talkies to-night and to-morrow night will view that most interesting screen comedy drama “David Harum.” The novel of the same name has been read with enjoyment by thousands and the play follows the book closely. Will Rogers, the celebrated actor-humor-ist-philosopher, has the star role, and is supported lay Louise Dresser, Noah Beery, and the drawling negro comic, Stephin Fechit. The mention of these star names is a guarantee of quality. The story is simple, but direct, very laughable, and amusing with a serious background that holds the interest to the end. _.