INFLATION OF PRICES

Timaru Herald, Volume CXLII, Issue 20493, 11 August 1936, Page 6

INFLATION OF PRICES

FARMERS’ OBJECTIVE By Association MASTERTON, August 10. Addressing a gathering of district farmers this afternoon, the Dominion president of the Farmers’ Union, Mr W. W. Mulholland, strongly criticised the policy of inflating wage and other costs without at the same time inflating the prices of agricultural products so as to bring them into reasonable relationship with costs. Mr Mulholland urged that it was imperative today as it never had been before for farmers to get together in their own interests, and those of the communitv generally, and urge the Government to complete the policy on which it went to the country.

Mr Mulholland said the Government had gone to the country on a policy of artificial inflation as opposed to the policy by which the preceding Government had reduced costs and brought these into reasonable relationship witn the prices of agricultural products. The present Government, however, had got the wrong foot first. It had inflated costs without inflating prices, and so had re-established, though on a higher price level, the conditions of 1931—the disparity between prices and costs which had led to the slump There was no question of going back on the policy of the last six montlis. Farmers, if they were to escape being ground down by those sections of the community compulsorily organised, must unite in doing everything they could to induce the Government co complete its policy by inflating prices and bringing them into conformity with costs.

Mr Mulholland condemned the heavy increase in company taxation. It was indirect taxation which would be passed on to the consumers, and therefore was totally at variance with the professed policy of the Labour Party. He contended that in its reintroduction of the graudated land tax the Government had taken no account of the position of sheep farmers who, necessarily, used a much larger area of land than dairy farmers. Particularly in the South Island considerable areas of grazing land could not be worked under the taxation now imposed.