WAR FINANCE

Bay of Plenty Beacon, Volume 6, Issue 19, 30 October 1942, Page 4

WAR FINANCE

Sir, —Liberty Loan No.. 2 together with Patriotic Fund appeals, National Savings, Security Saving Bonds, Bomber Bonds and various other appeals made on the people's money. Does it ever occur to the Powers that be that they are shut-i ting up the people's savings, curtailing its circulation and ultimately handing its control to the money lender. Production and more production is asked, whilst this cry harbours round* our ears others are appealing for the savings that were to assist production and purchase it when produced. In my letter of September 23rd T maintained that all money required: for war purposes be raised by the establishment of credits. Let me' take you back about. 21 years when the Local Bodies of the Dominion, most of them, had. borrowed from the banks by way of over-* draft thousands of pounds in 'excess of their legal limits. 11l other , words they established credits secured by Legal Ljmit and anticipated income. The slump came 1 along anticipated income did not eventuate. Banks required the credits to be reduced, and the Government had to come to light with a Finance Bill enabling Local Bodies to convert these overdrafts into loans known as the Antecedent Liability Loans. When all these borrowed savings are to be repaid the Government, will be in the same position as the Local Bodies were in 1922. They' will seek a loan outside the Dominion to repay these monies so raised. In the meantime the people's savings have lost their purchasing power until such times as the money lender's say you can have your money back. Unconsciously we drift- N ed into his hands. A credit established against tin's proposed Repaj-ment Loan would have left people with- their savings as the Local Bodies Antecedent Liability Loan left ratepayei-s with their rates during 1921-22. Had it not been for the Finance Bill the. barik's overdraft would have to be met by special rates.

To my mind a very bad principle is involved by the present method of finance. Ths pioneers of New Zealand kept as far away as passible from borrowing hence our solid foundation. Various administrations instituted borrowing for development. therein* handing part-of the cost, to posterity. The principle of borrowing the peoples savings lands us through various channels into the hands of the money lenders the very individuals our forefathers avoided Consequently we are undermining our solid foundation. What will the New World Order have to say when restoring order to our Dominion when you have killed the 1 goose that laid, the golden egg— the people's savings. The greatest shake hand the white world has received is from the United States of America. "The Great < Lease and Lend Act" financed by Congress authorising credit of mil- ~ J lions secured against, the countries, capital. Credit has been established against capital to be met by taxa-r tion. We in New Zealand require more , than taxation can afford to meet war requirements but a commandeer* of capital would establish a credit sufficient, to do so and posterity ; would be able to contribute to its repayment. That is practically what is being done with people's savings but the present day has to, suffer . to provide pleasure for posterity. Yours etc., P. MORA. 1