LESSONS FROM THE PAST

Evening Post, Volume CXXXVI, Issue 55, 2 September 1943, Page 4

LESSONS FROM THE PAST

Labour's election manifesto is very largely a repetition of the undertaking given by Mr. Fraser on Monday night t>at the policy the Government has followed during the last eiglit years will be continued and in sdme respects extended. What Labour is seeking is an endorsement of its legislative and administrative acts. and authority to proceed on the same lines during the,next three years. That being so, it is necessary and desirable to examine closely the 'results, of the Government's since it assumed office in 1935 and the effect they have had on the economic and social life of the Dominion. It is particularly desirable that there should be a full realisation of the marked and ever-increasing movement towards bureaucratic control and the corresponding decline, in the right of the people to exercise individual initiative. Labour's policy offers no relief in this respect; rather does it envisage an acceleration of the movement. In no way has the trend towards bureau* cratic control been brought home to the people more than in the control that has been exercised over practically all 'forms of-production and marketing. Almost invariably such control has resulted in alternate gluts and shortages of the everyday necessities of life and in prices which have placed many commodities beyond the reach of the average person. In its manifesto the Labour Party "undertakes to support co-operative projects by producers for processing, distributing, or marketing their produce," but the value "of such an undertaking must surely be judgedby what'has happened in recent years. There is no suggestion that the cumbersome and annoying restrictions which have been imposed are to be removed or that the operations of the Internal Marketing Department, which has signally failed to satisfy either producer or consumer, are to be reviewed. The Government is showing a marked hesitancy to relax any.of the controls which have been a feature of its administration. True producer cooperation is quite inconsistent with the degree of bureaucratic control that has been developed; and if is just nonsense to talk of encouraging co-operative marketing when the bureaucratic grip still holds. In finance, Labour announces its intention to continue the control of the Dominion's banking, credit, and currency system for "the prevention of inflation and deflation." Again it is necessary to examine the Government's past .record. When Labour assumed office in 1935 it embarked on a policy of expansion, a policy of spending for prosperity. ■ In spite of warnings as to the results which must inevitably follow such a course, it refused to call a halt until, in 1938, the economic stability .of the country was challenged to such an alarming extent that drastic measures were necessary to regain a balance. The Government's policy had resulted in the dissipation of a wonderful sterling reserve and'it now made necessary emergency measures of control over currency and imports. Government spokesmen at that time—and they have done so since—tried to place the blame on socalled • unpatriotic persons who, allegedly in order to embarrass the Government, sent their capital abroad. What happened was that the Govern : ment's imprudent financial management created conditions in which confidence was lacking. And when the inevitable happened the Government adopted measures ; which, whatever their immediate result may have been, amounted to an attack on symptoms rather than on causes. Political control of banking, credit, and currency has many obvious danger-points. Labour proposes to. continue it; the National Party on the other hand, while agreeing that it is desirable that Parliament, as distinct from the Government, should exercise the last word,, proposes that the issue and control of New Zealand currency should be vested in a non-political currency commission. It is Labour's intention to use the Reserve Bank to prevent inflation and deflation. Again this plank 'in its policy must be examined in the light of what has happened in the past—in this case, in the very recent past. By again ignoring obvious signs and postponing the introduction of a policy of stabilisation, the Government itself created all the elements of inflation. By its tardy action, it enabled sections of the community to greatly improve their position while other sections—notably the primary producers and those on fixed incomes and salaries—were left in a highly disadvantageous position. What the Government really did was to stabilise instability—for inequality can never be really stable. Again the Government dealt with symptoms rather than causes. It is well, when j the Labour Party, in its election manifesto, promises a continuation of the policy it has pursued in the past, that these features of its administration should be emphasised and remembered. Above all, it should be remembered that the Government offers no departure from the numerous measures of control it has exercised over practically every activity, measures which have made the State all-powerful and the individual subservient.