THE CREDIT PROBLEM.

Waikato Times, Volume 111, Issue 18623, 29 April 1932, Page 9

THE CREDIT PROBLEM.

(To the Editor.) Sir, —I am talcing the liberty with Mr Earle Valle’s permission, to amend this discussion’s title as above, since “ credit ” is a more comprehensive term than “ currency ” in these days of cheque and bank entry transactions. 'lt is a pleasure to note tho renewed vigour of Mr Vaile, who is easily the ablest of your orthodox correspondents. Thero was a time when the present writer would have enthused greatly over the free trade advocacy, the condemnation of the orgy of gambling ami idle pleasure, and so forth, with which our retrogressive generation iA accused. The various “shoulds" of which Mr Vaile makes use, when discussing wages, results of mechanical oulpnl, ami so I'orlli, sound very righteous in advocacy but the sordid truth is Dial our present barbarous predatory system cannot and does n/t ensure Ihoso shoulds." Tree trade doubtless would greatly ameliorate conditions, hill, it is by no means a cure-all of itself. There are two monster evils of which Mr Vaile has either never learned or does not admit, and the relative importance of these two factors renders all his disquisition on the, gold standard and so forth utterly irrelevant to ilio discussion proper. I refer, firstly, to the irresponsible ennIrol by private, individuals of the credit <ll iho wor’d, and secondly, to tho |eng ■ mi spec I in 1 and now fully established i.U.il Haw in tho world's accountancy system of Industry. Map*

Douglas and his -colleagues have established the latter fact to the complete satisfaction -of all thoughtful people, who have Impartially studied the relation of costs to prices In modern industry. They have rendered orthodox ’economic teaching out of date, and they arc now working for Die Indictment of tire crazy system o.t Industrial accountancy, which is dooming humanity to want in the midst of plenty, and threatening civilisation Itself with extinction. I heartily agree 'with the likening of talk of over-pro-duction under present conditions to blasphemy. Distribution is tho fault says Mr Vaile, and again I agree; but ■sinee money is Die machinery ol distribution, is itself intrinsically costless when divorced from the gold standard fe-li-sh, surely it is reasonable to assume’that the nigger in the firewood Is right hero in the control of this useful artificial medium. The -solution of ihe distribution of real wealth is surely related to tho distribution of lbe tickets of claim to tho said wealth, to ensure as it were, that Die tickets of claim were in sufficient quantity to the amount of wealth lor distribution, and were made available when and where wanted. The new economists of which Die writer is as yet a hall'-lledged Iml. eager student would laugh heartily at Mr Valle’s laboured efforts to make heedless humanity conform to a frugal and puritan system of expenditure applicable only to conditions of scarcity, the scarcity complete which was I He accepted normal condition of Adam Smith’s day. Under present conditions every farmer who increases his production ami at the same lime reduces

his consumption is aggravating the inI dustrial problem at both ends simultaneously. The writer himself is doing this, and must continuo so to do but that does not make it socially wise. Again Mr Vailo says that tho trouble Is that Mew Zealand workers are nol satisfied with what can be wrung from the soil of Mew Zealand. 1 submit it would bo nearer the truth, if lie said that Mow Zealand workers from experience, are dissatisfied with what can be wrung from them, when once committed to labour on Hue soil ol Mew Zealand.—l am, etc., id. A. MAG ME It. Te Kowhai, April Pi, 19it‘i. Tho publication of the foregoing letter has been delayed.—Ed. W'.T. - -