LETTERS TO THE EDITOR.

Waipa Post, Volume 45, Issue 3267, 13 December 1932, Page 5

LETTERS TO THE EDITOR.

AID TO FARMERS.

Sir, —Only those in close connection with the farming community have any idea of the very serious state of farmers' financial condition at the present time. During the past two seasons many have only been able to carry on by obtaining loans on any available assets. With credit exhausted and with a third season of production ion a still more unpayable basis, the condition of thousands is desperate indeed. It is extraordinary that the majority of business organisations even yet, after three" years of low prices, below the cost of production, do not seem to realise that the whole of this country's troubles are due to those low prices, and anything that will improve the returns of the farmer, will immediately improve the condition of the whole community, and with no improvement in those prices, the condition of the whole country, must go from bad to worse. With our exports down from £56,000,000 to< £33,000,000 and cost very little reduced how can it be otherwise. We have many suggestions for the improvement of the farmers position. Currency reform. Borrowing to pay rates and lowtering of the rate of interest. None of these could give the country the early and effective relief that a rise in the rate of exchange to bring us to the Australian level. The exchange has certainly improved conditions in Australia out of all knowledge during the past two years. Their credit in London is better than ours and the many catastrophies that we are threatened with, should we imitate the example of Australia, have not occurred there. The Australian banks have taken a broader and mPre helpful view of the situation than the associated banks of this country. They certainly have paid out much smaller dividends to their shareholders, but in collaboration with the various Governments have assisted by every means the producers to tide over this critical time. In spite of the fact that funds are now plentiful in London, to assist the producers they peg the exchange at 26 per cent with various suggestions that it should be further increased. The action of the Commonwealth Bank, which is acting the functions of a centre at reseiwe bank, in agreeing to absorb the surplus London funds is very fine. With the experience of the benefits Australia has derived through the adoption of this policy why dines our Government accept so weakly, the dictum of the Bank of New Zealand that we are not to have relief in this way? Handicapped in this way, how can we expect to compete with Australia in marketing our produce in the world's markets? Various Ministers have been taunting us with lack of enterprise in allowingl Australia to capture practically the whole of the Eastern markets, and yet they must know that the Australians can undercut the price every time, and yet pay their producers more than we can. Undoubtedly the very low price our butter is now realising in London is owing to the Australians continually quoting lower prices Owing to the advantage they have in the matter of exchange. The result of the present deflationist policy of our Government will be in the words of the chairman of the Bank of New South Wales " Greater Financial Stringency," " Greater shrinkage in business turnover. More acute distress." "The deterioration of Government finances and an increase in Had we been granted an increase to 25 per cent twelve months ago, we should have been in a much better position to-day. With wool at sd, lamb at 4£d, and butter at 8d or 9d, the outlook has never been worsd Sooner or later we shaH be compelled to follow the example of Great Britain and Aixstralia. Why the delay?—l am, etc.,

J. E. LEESON, Chairman, Morrinsville Co-op. Dairy Co., Ltd.