The Waikato Times FRIDAY, DECEMBER 14, 1934, THE DANGERS OF PLANNING

Waikato Times, Volume 116, Issue 19450, 14 December 1934, Page 6

The Waikato Times FRIDAY, DECEMBER 14, 1934, THE DANGERS OF PLANNING

While in many respects the merits of a economy compel recognition, it must be admi e . tain directions in which the resort to planning cames considerable defects or disadvantages. The P 1 '° d^ ctlo J l m try, the distribution of its product, even the methods of salesman ship, are all reasonably fit subjects for planning, when piannmg embarks upon the sphere of market limita ion, 1 ® . demand it to come in conflict with the very delicate mechanism of demand and purchase, which is governed not by artificial but y uman an psychological factors.

The effect of tariffs, quotas, and other weapons has been evidenced in the very heavy fall in the volume of world tradel and m very slender improvement so far seen m the primary, p ® dustries compared with, fon instance, that mm us ria r 0 ‘ Not only has the volume of international trade suffered, but it has been made more difficult and more expensive by the extension of bureaucratic control.

The recovery in domestic trade, which has been a notable feature of British progress during the past two years, and is now perceptible in this Dominion, has raised incomes among certain classes, and as a consequence there has been a marked recovery m the demand for semi-luxuries and for durable consumption g°° ds * A case in point is provided by the automobile industry, which has lately enjoyed a boom almost world-wide in its extent. Another fairly reliable indication of returning prosperity is provided by the marriage rate, which, the League of Nations bureau reports, has risen throughout the world.

There is, however, an indication that at least one human factor, which a few years ago could never have been regarded as a reckonable quantity, is approaching! a degree of stability that may bring it within the ambit of the economic planner. That is population. Despite the present increase in the, marriage rate, which is likely, o be reflected in a slightly higher birtli-rate, it is the considered opinion of experts that such a movement is only temporary, and. that the tendenoy will again be resumed towards a stable population, lbe implication of a stable population is that the supply of necessities of existence—food, clothing and raw commodities—will he capable of being brought within a certain degree of regimentation.

The vagaries of supply and demand, therefore, are likely to shift from the commodity market to that for personal services and quasiluxuries. The point to be borne in mind in this country, however, is that planning cannot safely be applied to the commodity markets without a very elastic provision for future expansion. Although population is, or may be assumed to he, relatively stable, the fact remains that thousands and possibly millions of people have as yet not been brought within reach of the commodities Which New Zealand can produce.

The indisputable trend towards socialism implies that all the members of a community will eventually be placed in the position of obtaining their requirements or necessities, and even with a static population, there' is room for tremendous expansion before this ideal is reached. It would be the height of folly therefore for New Zealand to regulate her dairy industry on the assumption that Britain’s requirements of, say, butter will never vary appreciably from the present maximum. Taking merely the average consumer, it would require a threefold or a fourfold increase in supplies, before the millions in Britain alone who are under the average could bring their consumption up to that modest standard.