The Press Saturday, November 22, 1930. The Economic Outlook.

Press, Volume LXVI, Issue 20092, 22 November 1930, Page 14

The Press Saturday, November 22, 1930. The Economic Outlook.

j According to a brief message from j Suva to-day, Sir Otto Niemeyer spoke j very cheerfully there about New Zea- ; land's future, and sensible people will be encouraged by what he said, without | for a moment losing sight of the condition which introduced it. Sir Otto did not say " New Zealand will be quite " all right," but: " Given sanity and steadiness, I think New Zealand will !" be quite all right.'' In other words, j New Zealand can stand in a I thoroughly strong position again, ]if she makes the effort to get i there. There is a wide difference between a belief that the future is bright and a belief that the future can be made bright, while between the covi responding policies the same wide dif- | ference exists. Sir Otto Niemeyer's ! statement sanctions and strengthens i only the more prudent belief. But to say that it discountenances a policy of I lethargic optimism is not enough. It : plainly enjoins upon the Dominion the ! active policy, difficult because action | means economising severely and systej matically, working harder, renouncing , luxurious social benefits, and learning ■ to tax and to restrict production less | injuriously; but the disturbing truth j is that the Dominion has scarcely begun iio do any of these thingfe. Even of the j little that has been done the effect is overwhelmed by fresh extravagance in i public spending and more vicious esi iortion of taxes. If relief were quite j certainly near, in u generous im- ' provement of oversea markets and ! prices, it would still be a heavy handi- | cap to the country that it had waited ■' for relief instead of fighting its own weaknesses, and recovery would at least be delayed. But there is no such certainty; there is not even any such hope. The utmost that it is reasonable to expect is that the depression oversea will lift by slight degrees, and that as it lifts the advantage of resolutely economising will increase. W hen the future is still difficult, therefore, failure to economise and to ease production on to a lower basis of costs is dangerous folly. A London message to-dav reports a warning speech by the chairman of .the firm of Dalgety, who said that he saw little prospect of improvement within the year. On Thursday night Mr W. Machin, speaking at the annual meeting of the Canterbury Manufacturers' Association, suggested that " the bottom of this slump" has not yet been reached and may be " a whole twelve months" ahead. Whether that is so or not, the country is poor and will for a considerable time remain poor; yet the Government is spending as if it were rich. This must stop. Elsewhere in The Press to-day we print some remarks by an observer unusually well qualified and placed to interpret the trend of evente in Australia and New Zealand. In the Commonwealth, he says, "a severe crisis is looming up; " but if the politicians will mend their ways and reduce their expenditure "it may be avoided- Taxation has ' " been increased; there has been little "or no retrenchment; and the national " income has fallen grievously." The situation in New Zealand is " very " much the same " —that is, not in extremity, but in its exposing the community to the same dangers. While the national income is sharply down, the Government, which ought to cut the national expenses down accordingly, not only allows them to rise but forces them up; and in these conditions production can only stagger and groan, in danger of a collapse which would be, of course, the collapse of everybody und everything.