IF LABOUR RULES

Evening Post, Volume CXVI, Issue 77, 28 September 1933, Page 13

IF LABOUR RULES

MONETARY POLICY

COMPLETE PUBLIC CONTROL

ME. SAVAGE'S SPEECH

The monetary policy the Labour Party in offlco will seek to introduco was further defined by Mr. M. J. Savage (Labour, Auckland West) in the House of Eopresentatives last night.

"Labour," said Mr. Savage, "stands for the complete public control of the country's monetary system, the whole service of which will be based ou goods and services; and as goods and services are produced their monetary equivalent will ba made available- to the people. Parliament will still be master of financial supplies. By systematic control of credit and currency and the development of No- Zealand industries, prices can be guaranteed to the producers and wages to the wage-earners sufficient to enable them to buy the equivalent of their production."

Mr. Savage added that a properly balanced, aiid planned system, of production and public Works would enable all workers to bo employed on works of first-class importance. Inequitable distribution duo to lack of purchasing power, and not failure in production, had caused'the economic crisis. Some claimed that an investigation should bp conducted into the present monetary system. Labour did not ask for any suchfinvestigation. The movement had made its own investigation, and had its -•emedy for the present obsolete system. It would not be wise to ask tiiose who were charged with failure to suggest.a remedy. The basis of the monetary system was entirely wrong, as it was founded ou external price levels and conditions.. Where was the economic reasoii for basing the whole financial system on prices received for exports, which1 amounted to approximately one-third of New Zealand's total production? INDUSTRY AND GOLD STANDARD. At present there was a strong movement to harness industry to the gold standard again. It was argued that by economising in the use of gold there would bo an ample supply 'ii that metal for monetary purposes, but that did not dispose of the case against gold as a basis of credit ant currency, nor did it destroy the case in favour of basing the Dominion's monetary system on goods and services. In an incidental reference to taxation, Mr. Savage said the limit in any form had already exceeded economic bounds. ■ The flat rate unemployment tax and the emergency wages tax could not be defended on any grounds, while the sales tax was also indefensible. Such taxes fell on the poor without bringing any real benefit to the Dominion as a whole.

Mr. Savage summarised as follows the main objectives of his party:—The Dominion's monetary system and trading conditions should bo based upon such internal prices levels as could be maintained by the productivity of its industries; it should be based on goods and services in order to provide the credit and currency sufficient to meet the rise or fall in Dominion production; control of banking should be transferred from private banking corpor tions to tho State; prices for Dominion products should be guaranteed, and should be supported by guaranteed incomes sufficient to enable tho people to enjoy the result of their ' labours; anarchic methods of production and distribution jniiat give place to planning in conjunction with price guarantees; mortgages on land and homes should be adjusted on the basis of an. average of. wholesale prices for. tho past seven years, and in the meantime there should be legislation preventing foreclosure pending tho establishment of internal price levels and rates of pay sufficient to enable holders ten meet their commitments; social services should be extended; schedules of public works should be prepared for the provision of immediate remunerative employment; hours of labour, should be reduced in relationship with productive improvements in machinery and scientific processes; wages should be increased in relationship with increased production; and external debts should be sealed down in relationship'with tho increased valuo of money measured in exports.