The Press Tuesday, November 15, 1927. The Arbitration Act.

Press, Volume LXIII, Issue 19158, 15 November 1927, Page 8

The Press Tuesday, November 15, 1927. The Arbitration Act.

It is so unusual to find a professional economist defending a highly artificial interference with the natural laws of industry, that the evidence given by Professor Belshaw, of Auckland University College, before the Parliai mentary Committee which is considering the Arbitration Amendment Bill is worthy of notice. Although Professor Belshaw said what he could for the Act —such as that it has saved the Dominion the cost of much industrial strife, that " some of the authorities " controlling industrial questions in " Europe were being criticised in much " stronger terms than was the Arbitra"tion. Court here," and that "people " had got into the habit of blaming the J " Arbitration Court for many things u due to other causes " —he admitted

that the constitution of the Court is defective and that its operations ought to be greatly modified. Exactly why he wishes to retain the principle of the Act he did not make at all clea*. He put first in his defence of it what he appears to think is a sufficient answer to the complaint that the Act has not ensured industrial peace. This answer is that since 1896 New Zealand has "lost less through [industrial] "troubles than other countries in "which there was not similar pro- " cedure. The point was," he went on, " how much would have been lost with- " out it? In his opinion considerably " more." It is impossible to say that his opinion on this point is wrong, just as it is impossible to say that an exactly opposite opinion would not be right. But one may doubt whether the losses that might have been caused by more frequent and prolonged strikes would in the sum

have amounted to more than a fraction of the loss sustained through the lower standards of energy and production, resulting from the Act, over a period of 30 years. That the Act has removed, or. at the least greatly weakened, the incentive to eager and zealous effort amongst the capable workers Professor Belshaw can scarcely deny, and that it has not turned poor workers into good ones is a selfevident truth. It is difficult to treat seriously his statement that "he did "not think the Court should be at- " tacked for the rise in the cost of " production unless it could be proved "that it was responsible." Nobody thinks that the Court should be blamed for what it does not do, but in the statement quoted it is distinctly implied that those who believe the Act has increased the cost of production are mistaken. Nobody has ever previously suggested, so far as we know, that the Act does not increase the cost of production. Higher wages must result in higher costs, and in higher prices, and these in turn lead to further demands for increased wages. This would not matter so very much if the rising level of costs and prices were accompanied by a rise ?n the level of production. But this has not.happened. In this connexion we may quote a telling passage from the Bulletin issued by the Chamber of Commerce yesterday and printed in to-day's paper:—

The need for increased production at lower cost is universally recognised, but it is futile to expect that this desirable end should be fully achieved while we fail to recognise how greatly industry is hampered by the cost-increas-ing regulations and restrictions imposed by the Arbitration Court awards and by public authorities. At the present time the State appears to be doing its utmost to help particular industries with one hand and to hinder industry in general with the other, while it imposes on all industry the swollen costs of both its help and its hindrance. The basic primary industries, unsheltered, unprotected, and but little regulated, have achieved soundness and health in the past, largely because their freedom threw the onus of achieving success on the initiative and enterprise of individuals. If we wish other industries to achieve the same sound health, to produce more at lower cost, thereby widening the local market for their goods and for the labour they employ, to ensure their own well-being without State aid, and to help rather than hinder the progress of the primary industries and the Dominion as a whole, then the restoration of a similar reasonable measure of freedom appears to be essential.