The Waipa Post. TUESDAY, OCTOBER 19, 1920. Published on Tuesdays, Thursdays, and Saturdays. BREAD AND BUTTER.

Waipa Post, Volume XVIII, Issue 1008, 19 October 1920, Page 4

The Waipa Post. TUESDAY, OCTOBER 19, 1920. Published on Tuesdays, Thursdays, and Saturdays. BREAD AND BUTTER.

THE supply of bread and butter to the people of New Zealand is costing the Government no less a sum than one million pounds per annum. The arrangements which have recently been announced whereby the price of butter has been fixed on the New Zealand market will require £600,000 per annum to be drawn from the national exchequer, added to which is the arrangement of some months ago whereby the wheat supply of the Dominion was to be assured by the subsidy of £400,000. Thus, through channels of national taxation, New Zealand is to be supplied with bread and butter, at. a cost of one million pounds per annum. If is clear that the Government's intention is to proceed in such a manner as will reduce the cost of living to (lie people of moderate means whilst, at the same time, assure to the producers of theseprimary products a return adequate to their efforts. Experience has proved that no Government would be justified in regulating prices for the

consumers without enabling a fair return to go in the way of the producers. The wheat-growers of the Dominion, even when the season’s were favourable, could not supply wheat at a cost below that of production, nor could the dairy farmers work at a non-payable industry. To have called on them to do so would have been to court disaster. It has been proved to the satisfaction of all who have studied the question that the cost of production has increased enormously during the last few years and had the price of the product not risen in sympathy many of the farmers would have been forced into bankruptcy. Had such a thing happened supplies for home consumption would have been drawn from a famine market, and famine prices would have had to be paid. More than this, the Dominion would have faced a financial panic owing to the failure of its export business. Therefore, the duty rested on the Government, in determining prices at which these products should be sold, to see that not only the consumer was protected against any undue rise in the cost of living, but, more important still, that the production of agricultural wealth was not interfered with. Therefore there came a system under which .the market prices were kept «t a minimum level by means of subsidy from the national revenues. Such a system, whilst serving these purposes, is not free altogether from criticism. To the large consumers—such as the shipping companies, the hotels and- the restaurants —it gives a very direct benefit at the expense of the general taxpayer. Moreover, whereas the public generally receive the benefit of the cheaper prices on the open market, only those who are within the reach of the tax-gatherer are called upon to pay the subsidy of £1,000,000. This means that the anomalies which exist in taxation extend and apply to commodities on the open market. Yet, on the other hand, it largely works out that those who can pay will be called upon to enable a system which counteracts the rising cost of living to operate. Were the commodities to go on the market at their full value those sections of the community who have access to the Arbitration Courts would ' have grounds to demand an equivalent increase in the cost of living bonus and this, in turn, would extend the circle of rising prices leaving those who have fixed incomes in a still more unfortunate position. All considered the Government has arrived at the best expedient possible and if the outcome is to increase work and production in all walks of industrial and agricultural life the burden on the national exchequer will not be a very serious one nor will the hardship or injustice on any one section be so great as may at first sight be imagined.