NEED FOR ECONOMY

Dominion, Volume 8, Issue 2534, 7 August 1915, Page 12

NEED FOR ECONOMY

WHAT CAN YOU DO WITHOUT; LESSONS OF THE WAR One of tlie groat lessons which tho war sends hurtling Lome to us is that lifo (Toes not consist in the abundance of tilings we possets, hut that essential tilings aro very few, and it ivi.ll be to our ■ hurt if we forget that fact) when the war is over. It isn't, tho pulpit ivhich emphasises this. point, but the banker' and fiio baker and tlie butcher, and so we shall soon ho faced with a..problem which will do some of us good to consider—What can I do without? Tlie national financial problem is to be settled by personal economy. The millions of the war bill aro to be paid by the saved pence of the people. "Everything we buy that we do not need diminishes our resources for investment, and employs labour that migiit be. given -to war work of some kind," says the "Manchester Guardian." "Every superfluous ounce wo use of necessary articles decreases the supply and increases tho price without prolit to anyone savo the vendor. To take a case that is in all minds at present, every domestic firo that is lighted becauso tho wind chances to tako an eastward turn contributes to making tiros impossible i'or thousands of tho poorest in the coming winter. • Ceasing to , Consume Luxuries. argument can bo pressed too. far. At present it is not pressed far enough. Much of the existing carelessness in expenditure and'consumption is duo_ to ignorance of -where and how to begin economy. In this the Government could and should help by issuing simple and urgent advice on what constitutes rational expenditure at this time. It would give all a chance to help iu the conduct of the war which would not bo neglected." "Wo can produce the required munitions and "other supplies for our forces and tho forces of . our Allies in no other way than by ceasing to consume luxuries and unnecessaries, and so diverting into the- increased production of war materials and supplies the productive energy thus 'saved,' " says the "Nation." "Every class will be required'to undergo what it will regard as heavy sacrifices in its 'standard of comfort, 1 if tho financial needs of this war are to he met. Private .motor-cars,- expensive and pleasurable holidays, consumption of alcohol and tobacco, smart clothes, literature, education, and philanthropy, to name a fow among the many objects of expenditure, must largely disappear. Ysu Can't Have it Both Ways. "Everybody -must be forced to realise that every pound expended upon these or any other forms of luxury or satisfaction means a pound's less production of arms, or ammunition, of war stores, or of the means to buy. them from abroad. "England has got to put herself on a financial war basis by devoting the whole of her organised economic resources to tho support of the war, by furnishing munitions and othor supplies in the largest availablo quantities, and by cutting down the 'civil 1 expenditure and consumption of the nation to tho lowest level compatible with efficient industrial service. Our national finance must be directed to stimulate and in tho last resort to compel this necessary economy." Cost of Food. "No one needs now to bo told of the rise in the price of foodstuffs," says the "Manchester Guardian." "Small as it is in proportion to the world crisis that has caused it, it is a reminder to every honsev/ifo that there is work of the first value to her hand in rigorously cutting down superfluous expenditure. The reminder is still to little heeded. With care- the question of our food supply need not trouble us; without more care than is at present shown it may become an additional war anxiety from which no Government intervention will fully deliver ns. "The best remedy lies in rigorous individual economy. For a start in facing it we should, get rid of the mesmerisms of 'business as usual' -as a guiding text. Tlie notion that whatever purchases we make help to 'keep things going' is _ a dangerous one. The aim at this time is to employ the labour of tho nation, as far as is possible, either in fighting or in producing munitions of war, tlie necessaries of life, or exports which will pay for tho articles we must import." Inorease our Output, "Now, we have not a single word to siiy against additional saviiigs," says the "Statist." "Oil the contrary, we urge every reader to try to savo more than ho has ever done before, and wa shall have, nothing but praise for those who succeed in doing so. But there is a vory much easier way' of meeting our difficulties if wo would only faco it boldly .and manfully, and that is to increase our output. "Let us take the man who is at present earning a thousand a year. Is it possiblo that, he cannot increase his earnings ? Ho may have a fixed income, njid, therefore, it may be possible for him to, add to his incomo only by working in some other way during leisure time." Spent on Luxuries. "Tho national income when war broke out (the aggregate, that is, of tho incomo enjoyed by every individual in tho country, rich, or poor) was about £2,200,000,000." writes Sir Leo Chiozza Money in the Weekly Dispatch." "The probable expenditure of £1,133,000,000 in tho present financial year therefore means spending publicly in a year a sum equal to about one-half of a year's income. "It is probable that in the last year of peace rich and poor together spent 011 luxuries, from motor-cars to tobacco, ?ind from sumptuous dresses to four-ale, fully £600,000,000. That this is not an oxcessive estimate may be gathered from the following items, which aro near approximations to tho truth:— A Fow Branches of Expenditure in. the , Last Year of Peace. Million £ Alcoholic drink, about 160 Non-alcoholic drink (including the preparation of tea, ctc.), about 70 Tobacco, about 35 New motor-pleasure vehicles and . car. maintenance, about 75 Total 340 "Now tho £1,133,000 already mentioned is, roundly, made up as follows: Million £ Fcaco expenses of Government, including normal Army and Navy expenditure, say 260 War 673 Loans to Allies and Colonies 200 Total 1,133 "So that it comes to this: Terribly 1 costly as the war is, it will not cost us twice as much in the present financial year as u;o spend normally in a year on alcoholic drink, t-ompcranco drinks, tobacco, and motor-cars. •"Wo need not bo frightened, therefore, by tho mere looi; of the figures," adds Sir Leo Money:' "Wo are a'great nation. Tliero aro fortysix millions of us to find tlie money. Wo iifo going-In lintl it, and mors if . j to; .fi^,.iho„tljui^ ; through,.

But we may do the thing with many different degrees of wisdom." The Spendthrift's Argument. "There is," says "A Banker" 111 tho "Times," •'» common belief that saving is actually to ho avoided and that expenditure, iio_ matter what its nature, is desirable, in order to - give employment. Nothing could bo more miSr ohievous in present circumstances than such an idea. Take certain concrete instances of expenditure as illustrations. "If a man orders a motor-car now, not only has ho so much less for investment, but be is employing labour ill making his car which might otherwise be employed in tho direct servico of tho Stato iu somo form or other. If he unnecessarily adds to or builds a house lie is again not only employing labour unnecessarily, but he is causing materials, such as timber, which have to to paid for, to ho imported from other countries. "Again, if coal is unnecessarily used, labour is unnecessarily-'employed, prices arc raised, and the export of coal abroad hindered. Take-again the wasteful consumption of food or tobacco or petrol. These articles must also bo imported and paid for. Unnecessary expenditure therefore involves tho diversiou of labour from war purposes, larger imports, and less exports. Danger of Increased Consumption. "It must bo remembered," adds "A Banker," "that owing to changed war conditions there is a great risk of'our consumption actually iucrcasing. Olio effect of our lavish expenditure is to transfer a largo amount of incomo from tlie wealthier to the poorer classes; Alarge redistribution of wealth is in process. So far so good. In itself, no doubt, excellent, but not if tho money which in tho hands of the wealthy woulil be saved is in. the hands of its new- possessors simply spoilt. Money is being taken out of tho pockets of tho investing classes and being redistributed in iho form of higher wages, war bonuses, separation allowances, and so forth among tile non-investing classes. "Consumption is therefore likely to increase, and consumption of a kind not necessary for tho conduct of tho war. More food, drink, and tobacco will be consumed; 'more labour employed in services not contributing to tho national strength; more time unprofitable' spent; less money saved. Tho class which, is so greatly enriched by tho war is not the very poorest class, in which case extra expenditure would lib justified, hut mainly tho artisan and better-paid workiug class which is already comfortably off. It is not as if saving ' were any sacrifice to them. Their own interest- and that of tho Stato absolutely coincide. It is, indeed, madness of them not to save in this period of their 'exceptional prosperity against tho certain day. of shrinkage in the future-^' WTiat can you do without.