A CHANGED ATMOSPHERE

Evening Post, Volume CXIV, Issue 126, 24 November 1932, Page 12

A CHANGED ATMOSPHERE

Though' Mr. Downie Stewart has been away from New Zealand less than six months that period has seen marked changes. A month ago we would have pronounced the changes generally favourable. The Prime Minister's Budget showed a reduction of the probable deficit by~ half. Though this was "mainly due to British generosity in postponing funded debt payments, there was also an improvement" in Customs revenue prospects. Revised^ estimates of Customs revenue, even" allowing for Ottawa concessions, were better than those submitted in the special session. Exporters, too, were encouraged by the help secured under the Ottawa agreement. There was hope of slow but steady improvement. In the past few weeks, however, the prospects have clouded again. Lower overseas prices, in spite of Ottawa, have'led to something approaching panic among the ranks of rural members of Parliament. This has been shown in the ill-timed effort to rush the Government and the banks into inflation. The atmosphere is unsettled.

We do not wish to under-state the difficulties; but it seems to us that the counsels of despair are too much heeded. A position which a month ago showed gleams of hope cannot so soon have changed to utter darkness. There is too much talk of bankruptcy, too much advocacy of extreme measures. It is necessary that facts should be reviewed calmly, more especially to discover how far we are grappling with the great root problem—over-valued, over-mort-gaged land, and over-capitalised production—and how far we are adopting, or seeking, dangerous expedients such as high exchange to save us from facing this issue.