THE FARMER'S POSITION

Evening Post, Volume CXVII, Issue 144, 20 June 1934, Page 8

THE FARMER'S POSITION

A cheerful view of the present position of the farming community-was taken by Mr. Macfarlane in his presidential address to the Royal Agricultural Society yesterday. For many farmers, he said, this last year had been the best since 1914. The improvement had.been seen in the quantity and quality of production arid in the high working profits which had enabled most of the losses of the last four years to be paid off. The industry was now' on a much more solid foundation financially, costs were lower, and markets were steadier than they had been for years. We anticipate that there will not be universal endorsement by farming leaders of this optimistic summing-up. Farmers will not admit that they are in the fortunate position which Mr. Macfarlane's statement indicates. For if they were what prospect would there be of achieving the new aim that some of their leaders have in mind—a further compulsory reduction of interest. A definite drive is being made towards . this objective. What the Americans call the keynote of the campaign has been sounded by the president.of the Farmers' Union in recent addresses. The note is taken up by the official organ of the New Zealand Farmers' Union, "Point Blank," which thus states the aim:—

Figures show- that, there is no cheap money available iv Now Zealand, today. There ia no : better way of helping the farming community than by bringing down interest, rates and. other charges. Cut the farmers' interest another 25 per cent, (which would still leave it higher than the ruling rate elsewhere), utilise the petrol taxation for derating purposes, and reduce the tariff ,on British goods entering our ports and tho relief to the community generally, and particularly the farmers, wouia be enormous. Even at present prices most of them, would be able to pay their way.

'■-. The purpose of this drive for compulsory reduction .of interest is clearly revealed by the union journal. ■

The president has reminded us that this cry about high land values is all moonshine. "Show me," he says, "a country where land values aro high, and I -will show you a, prosperous country." What is wrong is high interest rates.

Land values are high here, and we do not hear farmers proclaiming their abounding prosperity. The reason is that the values are higher than production returns warrant, and they have been kept at that level only by a series of artificial measures —high exchange, compulsory reduction of interest, a moratorium on mortgage engagements, and subsidies. Even these have failed to sustain the values. Therefore another drive is to be made for further interference. With what object? To bring back again the false prosperity of a speculative boom in land. But the farmers should be warned of Avhat has already happened. Land mortgages are a drug in the market because of interference. The president of the Royal Agricultural Society yesterday predicted that

when confidence in the land returned fully the business world would bo falling over itself to gefc money into primary production at any sort of low interest. It was the duty of every farmer to maintain and increase that confidence.

What prospect is there of renewal of confidence with an interest reduction drive in progress?