RATIONING

Bay of Plenty Beacon, Volume 05, Issue 25, 6 March 1942, Page 3

RATIONING

OF ESSENTIAL GOODS

"In war-time the supply of goods for civilians to buy and use and consume is strictly limited at any one moment, no matter how much money people have to spend. "As the British White Paper puts it: 'Thus curtailment is inevitable whatever money Avages, salaries, or profits arc paid oiit; and increases in Avages or other incomes cannot make more goods available.' And if a Avorkman does, in fact, find himself better off because of a rise in Avages: or salary, as, of course, does happen it must mean that someone else, someone less well paid, is correspondingly Avorsc off. "To quote the White Paper again: 'Such increases in AA r ages, salaries, or

profits would not raise the general standard of living; they would merely tend to send up prices—more money competing for no more or fewer goods —and to decide the shops, making it difficult to secure a fair distribution of the limited supply o!' goods; and those with the least able to spend time in shopping and standing in queues, would suffer most. "It does not need a White Paper to tell anybody that the prices of the things that most people want tend to rise unless, of course, they are controlled, and then the goods tend to disappeare. Supplies are short, and the shops are emptied by the shoppers with most time or most money, and the point of this obvious argument is that, when the supply of things to buy is limited as it is now, raising wages or salaries or profits just makes matters worse. There's more money to spend, and there's a scramble for goods. "Obviously, all this bumping-up of prices is a bad thing. People with low wages, small fixed incomes, pensions, or insurance benefits become hard-pressed to make both ends meet. And what is more, increased prices mean more increased prices still, because when prices go up, people want more wages to cover them: and more wages mean higher costs of production (unless there is some corresponding increase in efficiency, in preductvity), and higher costs mean higher jorices again: and so on round Avhat they call the Vicious Spiral."—Mr Donald Tyerman in a l-eccnt address.