The Dominion. THURSDAY, MAY 27, 1920. THE WAY TO PROSPERITY

Dominion, Volume 13, Issue 207, 27 May 1920, Page 4

The Dominion. THURSDAY, MAY 27, 1920. THE WAY TO PROSPERITY

Many considerations urge this country to oxtcncl and enlarge its secondary industries, _ and most of these considerations will retain their force even when the abnormal conditions of world-trade which are now being experienced have run their course. The cost of manufacturing in Britain and other countries from which wo draw our imports has permanently and largely increased. Figures were quoted a clay or two ago which show that, on an average, the price of British exports at the point of shipment has increased by 170 per cent, as compared with pro-war days. The actual cost of shipping transport, also, has enormously increased and must remain at a far higher level than before the war. Good prospects aro thus raised that the cquntry would profit by an extension of manufacturing enterprise —particularly in tbo direction of manufacturing a larger proportion than at present of its own raw materials—which is essential in any case to balanced progress and development and in order that it may have more assured control of its own prosperity and the cost of living within its borders. . An_ extension of local manufactures is the only hopeful means of modifying appreciably the conditions in which the prosperity of the Dominion is governed largely by demand and prico in oversea markets. Although primary industries aro and will be its mainstay for a very long time to_ come, How Zealand has everything to gain from having such a second eking to Its bow as flourish-

ing secondary industries developed on a considerable scale would-jeprc-sent. Adding to this that few countries are bettor endowed than New Zealand with the natural resources which make cheap power readily available., it is cvidont that its people are offered the strongest, possible incentives to undertake an enterprising development of secondary industries. It has to be recognised however, that something more than initiative and enterprise on the part of business men and manufacturers 1 is needed to ensure sound and rapid iirogrcss on these lines. If there has been some lack of enterprise in Extending secondary industries in this country, at least a partial explanation appears in tho fact that the development of these industries is obstructed by serious handicaps and even by positive penalties. The company tax, for instanoean impost so generally condemned that its early abolition ought to be assured—is very obvioikjy at once a handicap and a penalty on legitimate enterprise. It is equally unjust and impolitic to take in taxation a third or more of the earnings of a joint-stock company with a capital that is large, or even fairly large, in amount, however moderate these earnings may be in relation to the capital invested. People of limited means, | even though as individuals they are taxed, on the lowest scale, may' thus liavo to pay taxation on tho highest i scale on income derived from money invested in business enterprise. In most forms of manufacturing, as in various other kinds of business undertakings, the utilisation of a considerable body of capital is essential to efficiency and to production or service at moderate cost. Because it seriously impedes organisation on these lines, as well as in view of the injustice it imposes on individuals, the company tax ought to be repealed or readjusted, and a,ll who wish to see secondary industries so extended as to facilitate cheap and efficient production are interested in having this change made. It is in the interests of the whole population that penal taxation should be levied only on big individual incomes. An even more serious obstacle to the development of secondary industries appears in .the industrial conditions that' prevail throughout the Dominion. It is particularly plain that the existing relations botween Capital and Labour offer any business man little enough encouragement to open out new lines of enterprise.. It is just as evident that the worst impediment toan improvement in these relations is the persistent assertion by considerable sections of organised Labour of the disastrous "doctrine" of less work and more pay. The time has surely come when the people of this country are called upon squarely to face the fact that the degree of comfort attained depends absolutely upon tho amount o{ work done and the volume of production attained. No fact is more obvious. To state it is to repeat the veriest platitude. Yet many ol the most active spirits in the Labour movement to-day are doing their level best to reduce the scale of production and extort an increased wage for i lowered output. Thesa men profess that they aim at raising the standard of living and enabling the working population to live in greater prosperity and comfort. In common honesty they ought to stand up in their real character as enemies of popular welfare. If their policy aims in any, respect at advantage it is the advantage of limited sections, gained not so much at tho expense-of their employers— who are able as a rule to adjust themselves in some fashion to adverse industrial conditions—but at that of the body of consumers, most of whom are their own fellow-work-ers. Even those who are most assiduous in demanding increased pay for a diminished output would hardly suggest that the worxlng population as a whole will increase its .comfort by producing less, it follows that they are practising a fraud of which their fellow-workers are the destined victims. The right remedy for the industrial conditions which have been foisted on the Dominion is to bo found in supenmposing a system of payment by results on the foundation of a fair wage.'., .The piece-work System might be extended greatly with advantage alike to honest workers and to the consuming public Where piece-work is impracticable, the system might be adopted of continuously recompensing each improvement on a pre-dotermined rata of output by the payment oJ bonuses. Such proposals are commonly met by some sections of organised Labour with the cry that they would lead to injurious "speed-ing-up." In the circumstances that exist in New Zealand such protests are a ludicrous travesty of the actual facts. Tho day of tyrannical driving by employers, if it ever existed in this country, is over. Today it is rather organised Labour which tyrannises over the employer. It is by the free adoption of payment by results, if at all, that the Dominion will make j;ood use of the unexampled opportunities, it is now offered of extending its secondary industries, and there is great scope for tho application of this salutary reform in many existing industries.