Evening Post. FRIDAY, FEBRUARY 10, 1933. PUBLIC CONFIDENCE

Evening Post, Volume CXV, Issue 34, 10 February 1933, Page 6

Evening Post. FRIDAY, FEBRUARY 10, 1933. PUBLIC CONFIDENCE

_ Further evidence of the perversity of human nature, and especially of mercantile human nature, was supplied! by the statement of the. Auckland Importers' Association which we reproduced yesterday from the "Auckland Star." As long ago as Monday last the opinion was expressed by the Minister of Finance that "it was high time the agitation against the high exchange was allowed to drop," and from Whom could it have com^ with greater sincerity or higher authority? It was he who. took the responsibility of introducing the measure,' who enforced the resignation of a Minister of Finance of equally high standing in the judgment of the experts and the confidence of the public in order to do so, and took over himself a portfolio for iwhich his qualifications had not been proved, and who, with the aid of the Whips, got the House of Representatives to pass the Bill by a substantial, though much reduced, majority. The same day1 which brought the announcement of the Government's decision to ■ increase the exchange rate, and- of Mr. Downie Stewart's resignation, and of the transfer of portfolios of Finance and Customs to Mr. Coates, brought also this statement from the new Finance Minister:—

The exchange rate is a controversial problem'on which there lias been no lack of discussion. The pros and. ■cons have been set forth exhaustively, and tlie arguments are- fresh in the public mind, so-that it is needless to say much at, this juncture. The. wisdom of the action that lias been taken can only.be borne out by experience.

If before that date, 20th January, the 'arguments had been "set forth exhaustively" and were "fresh in the public mind," the arguments were not those of»the. Government. Before Christmas the then Minister of Finance was known to be against the high exchange. \Mr. Coates was believed to be working for it. Minis- | ters had again been consulting i economists who favoured the raising of the rate, but no others. But the Government stood firm, and tho rejection of.the demand by the banks and the Prime Minister's assurance that the Government would not interfere with tlie decision of the only proper authority set the public mind at rest. It remained at rest during the Christmas holidays, but there was no rest for the high exchange' engineers either wilhin or without the. Cabinet. Tlie success of their almost entirely secret labours was revealed when the- bomb exploded oh 20th -January. It was when the noise of this explosion was reverberating in the public ear that the new Minister of Finance published the statement we have quqled. "The pro's and cons had been set forth" 'so exhaustively and the arguments were so fresh in the public mind that it was "needless to say much at this juncture." Why the pros of December'had become cons iin January and vice versa was not explained then, nor has it been explained since. There are * many more things that need explaining and discussing to-day, but whereas it was needless to say much on the previous occasion, it is desirable and even imperative that-nothing at all should be said now. It is "high time," says the Minister, "that the agitation against the high exchange was allowed to drop." The grave responsibility of disregarding this edict has been incurred by the Auckland and Wellington Importers' Associations, and we must plead guilty too.

A glance at the chronology of the agitation of which the Minister -of Financevhas had enough will suffice to show the extraordinary nature of his demand. It was, as we have said, bn the 20th January that the Government came out into the open with its high exchange policy. Mr. Coates moved .the second reading of its Bill on the 27th, the third reading was reported in the papers of Saturday, the 4th February, and on the following Monday evening he issued the statement in which the opinion is expressed that the agitation against, the high exchange should cease! The. policy of the j Government had then been less than three weeks before the country and its Bill less than a fortnight. What conception can the Government have of the gravity of the economic issue, of the state of the public mind, and of jhe insecurity 'of its. own position when, the Minister- of. Finance can make such a suggestion without any intention to insult or to amuse? The offence was aggravated by the quality of the statement itself—a solemn attempt,' to prove that. , the action of the • New Zealand-Government in , nearly doubling a huge deficit by a. financial somersault which it hopes may work out well, and the action of the British Government which thrilled the whole world when it was pushed off the gold standard but averted disaster by converting a threatened deficit of £170,000,000 into a surplus. There is a courage

which plays for safety, and there is. also-courage in a gambler's throw, but it is ludicrous to compare the two, and expect intelligent people to swallow the comparison. This very unfortunate statement of the Finance Minister confirms the impression that we have formed on broader grounds that, uncomfortable though the position of the Government must be, it does not fully appreciate its gravity. The majorities of eight and nine by which it got its Banks Indemnity Bill through would be good enough under ordinary conditions, but compared with . its election majority of twenty it shows an ominous. decline, and it is grievous to think that after being, elected with a "free hand" mandate on a national basis it had' to whip hard to make even this poor showing. It will of course be possible to hound the, recalcitrants :but of the Coalition, but it will do little to improve the Parliamentary position, and .neither inside the House nor out of it is it desirable to stimulate the 'as yet vague movements toward- new party formations. The alienation of the public is .probably still more serious than that of : the politicians. Even yet Mr. Forbes and Mr. Coates do hot seem to realise how much of the public confidence deserted the Cabinet when they forced Mr. Stewart out of it, "how' imperative is the necessity to lose no chance of conciliating the great body of sound and moderate opinion which he represents, how much might be gained by making the urban taxpayer feel that, hardly as they are treating him, his interests and sympathies are not entirely beyond their care. Even a mere gesture might have a calming and soothing effect, but such appeals as that to which we have referred can do nothing but mischief.