Public Opinion

Wanganui Chronicle, Volume 74, Issue 146, 23 June 1931, Page 6

Public Opinion

PUBLIC DEBTS Sir.—Your leading article of 16th inst. dealing with the indebtedness of the Dominion and local authorities was, to those who stop to think, educational and staggering. Most people, as a rule, do not seem to understand or don’t care so long as they individually are alright. But, Sir. the time is fast com mg, or has come, when all will have to care, for as you truly say, “Debt can not. go on for ever mounting up.” The great question is, can we as a people ever overtake the huge sum we are now paying by way of interest, which like the proverbial snowball increases as it rolls on. Wc (as was the Common wealth) have external and internal interest to pay and there is a vast difference in the payment thereof. Inter nal interest can be paid with paper money, which circulates among our people, taxes can be paid with paper money, consequently internal interest can bo obtained by paper money, taxes, exchange not affecting the transaction. With external interest the position i? very different as this can only be paid with gold or goods; and this is where the pinch comes in. This same can only be eased by increased value for exports or decreased value of imports; there is no other way by which our finances can be squared. We read of the difficult position, financially. of the Common wealth, and when one dips into matters it is ascertained that there is not a great, deal of difference between New Zealand and the Commonwealth. New Zealand’s oversea debt; is £lO7 per head of population. that, of the Commonwealth is £185; consequently oversea interest is the same or approximately so. The Commonwealth finds that it is imperative that, their overhead costs must come down, wages and salaries by 20 per cent., yet there arc people in Ncav Zea land, ves. even in Wanganui, that say

all is well. I have, after an exhaustive review 'of finances, come to tho conclusion that but for the fact that we export more per head and import less than the Commonwealth our financial position would be much worse than it is. New Zealand’s public debt, as you point out. was on March 31. 1930. £l7B per head. In the Commonwealth at same date it was £173, the public debt being one billion one hundred million sterling. 527 millions of which was owed internally and 573 millions overseas. The public debt of New Zealand on March 31. 1030. was £267,383,343. of which £116,526,091 was owing within the Dominion; consequently the interest ean be. paid with paper money which circulates among our people, the balancc. £150,857,25'2, is owing overseas and interest ean only be paid with gold or goods. How are we going to pay? It can be done only by more production or less imports. The population of the Commonwealth is 5,436,794 and overseas interest approximately twenty-eight millions sterling, and another twenty-eight millions for’ internal interest that can be paid with paper money. Now Zealand’s populations is 1,411.198 and overseas interest about six millions sterling; this, with internal interest, about four millions sterling, makes the interest bill in the vicinity of ten millions sterling. A tidy sum for so few people to find, but not so great per head as in the Commonwealth. During the past eight year in New Zealand exports exceeded imports, in value, by forty millions sterling and this has just about paid our overseas interest. In the Commonwealth during the same time imports exceeded exports. This, of course, makes our financial position sounder. The future is problematical and calls for economy and caution. The vital question is will we be cautious and study economy or will wc continue to cry, “On with the dance.” I know that some will dub me a pessimist; my answer is. “Optimism not founded on truth and reason never did any good.” —I. am, etc., J. SIDDELLS.