THE COUNTRY'S NEEDS.

Press, Volume LXVIII, Issue 20489, 7 March 1932, Page 13

THE COUNTRY'S NEEDS.

1 FROM FARM TO FACTORY. ATTACK ON ECONOMISTS. An attack on what lie iloscnbcd as tlie arrogance of the fannei, a long postulation of his theories of a central banking system, and an allegation of inadequate knowledge of economy, as he interpreted it, on the part of New Zealand economists, were features of an address entitled "The Way Out of the Slump," given by Mr L. C. Walker to members of the For New Zealand Society on Saturday evening. "It is not necessary for us to continue a nation of farmers. e ve got to make up our minds to alter our course, and do a little less of this farming business," said Mr Walker. "For years we have been a borrowing people, because, after the initial settlement of the country, we developed what was easiest at hand and became a nation of pastoralists, whose settlc- [ ment and land incurred huge expenditure, which could only be met by loans. "In the course of our history we had our depressions, but after the war there was a rise' in prices which set up a great cry for land for settlement. We found that we wero able to market our produce at high prices, and in the general momentum the average young man saw the land his only sphere. The whole country was carried away in this farming orientation." Yet the settlement of New Zealand farmers had cost a huge sum, the speaker pointed out. In 35 years only < 7147 people had been settled in New Zealand, yet at an expenditure of £14,000,000. This was not all, for as a result of their settlement the country had had to open up the land and build roads, railways, and extensive public works, the result of which placed the cost of putting them on the land at something like £'40,000,000. This was not a very great achievement, and had helped the averago man very little indeed. Mr Walker claimed that the bad distribution of gold had been one of the factors in precipitating the crisis. The economists had not suggested in their report that New Zealand should try to solve the problem. He believed that what gold the banks had in New Zealand should be sent right away to America. There was £6,000,000 of available gold in the country and small as this amount was, comparatively speaking, its sale would have a material influence in the balance of world gold. It had been said that as small an amount as £80,000,000 in money, representing reparation payments due to America by Germany, had precipitated the economic crisis. | A Central Bank. Mr Walker spent some time iu eluci dating his theories on the banking system, advocating a central bank, which would bo the hub of a vast wheel of reorganised industry and society. "We can get out of this slump, with honour and decency only by forming a central bank right away/' ho said. " The orientation of affairs has changed. For years the whole country has been run by the English market, but now, with all due respect to the Mother , Country she has dropped us there. All at once our old market collapsed. '' But it will be a tragic error if we continue to expect the Mother Country to take our goods at anything like the prices we got for them for the last 20 years. We will have to alter the whole scheme of things and set up a central bank, with powers to purchase existing banks and reorganise them as specialist co-op-crativo banks, with branches in every one of our foreign markets, with specialist staffs able to control industry, and State controlled. Indeed, I think that in a few years a central bank will have to be found to prop up the banks they run to-day." The central bank would be to many what the Supreme Court was to justice in New Zealand, and the best model, the speaker believed,-was to bo found in the Investment Banks of Germany—banks, which ■ financed and controiled industrial monopolies in the country. They had on the staffs some of the finest technically skilled men in Germany, and _ when lending jnoney to finance big industries placed these meu m control. The capital was not on r.hort term loans, but was provided iu perpetuity. don't want to be quite dismayed by the report of the economists,'!' said •ti W^ er - "They are quite good With their sums, but I am not sure that they know their work as well as we think. In New Zealand our economists are busy school-teachers, and can know little about the wider economy of life. I doubt if any economist in the world knows the economics of engineering." The Farmers. If I am here for anything, it is to protest against the arrogance of the farmers," continued Mr Walker. "There has been the one small set of a small and narrow-minded type, that thinks itthe Alpha and Omegat of all civilisation. They have been like that for years, because they have been unable to see that the rest of us have something more than , a stomach for tho farmer to fill—a mind." He could easily visualise a mem,ber of Parliament standing up in the House recently and saying that tho farmers were the only real producers in" the country, but it Was not true. The farmer, after all the expenditure involved in placing him on the land, could get only a third place his butter, his cheese, and his lamb, in prices on the Homo market. was a limit to production, too, ft, l,eli ? ved that if the production « U^er * neroas ed in the Dominion the farmers would get "but the price of whale-oil—ljd a lb." \ Mr Walker answered many questions put by members of the largo audience, snd was given a vote of thanks.