The Grey River Argus SATURDAY, June 5, 1948. LABOUR BUDGETARY POLICY

Grey River Argus, 5 June 1948, Page 4

The Grey River Argus SATURDAY, June 5, 1948. LABOUR BUDGETARY POLICY

fpHAT workers in British Dominions are circumstanced better, than others may be inferred from the fiinancial position in every case. Australia’s large surplus of thirty million is the latest illustration. Canada has recently had a good surplus, which is being largely devoted to debt repayment. New Zealand has also a favourable balance, although the use of funds to reduce indebtedness to Britain has been questioned by the Opposition. In South Africa the financial position is sound. Britain stands to benefit from the buoyant finances of the Dominions, which all contribute largely towards her recovery alike in the supply of essential materials and in providing- her with export markets. Britain has latterly demurred - at having to pay ordinary interest on a quarter of the funds expected from the Marshall Plan, -but three quarters of the credit, or its equivalent will entail only nominal interest. There is yet question indeed, to what extent Britain will repay, and the leaselend technique might again be invoked, especially in the event of military complications. Meantime the Americans are disposed to look more carefully into the disposal of the funds they are pro.posing to provide for Europe, as they reckon that already no little of their contribution to Germany has been almost wasted. They are looking doubtless for faster economic reconstruction. In the Dominions without exception there has since .1939 been expansion of industry at a growing rate, so that those in this country who, are talking of sacking public servants by thousands ci’.id of cutting down social security by millions are- narrow in outlook, and disposed to ignore similar development elsewhere. The point is that when there is a fully employed population at reasonable rates of remuneration, the State is certain of solvency, and in a position to conserve every phase of its economy. If Australia has thirty millions in the Federal coffers as a result of one year’s transactions, it is a reflex of the income of the whole population. The cry is at once heard that it indicates the wisdom of reducing income taxation, but the question is as to whose incomes should first be relieved. In Australia, as here, it is those with the larger incomes who arc the more eager for concessions on the score that their taxation rate is the higher. On the other hand, from the national standpoint, a larger revenue accrues from the lower incomes, because they are so much the more numerous. Moreover, they remain in circulation in far the greater proportion, promoting industry and commerce. The State nowadays is saddled with much larger obligations for industry as well as social security, since capitalism in practice creates the very inequality which the-State has, in the sphere alike of taxation and subsidy and benefits, ’ to redress. It is sound finance when the State demonstrates its ability to equalise the national dividend. The reason it must do so is simply that the capitalistic system is incompatible with economic justice or freedom. Australia therefore is a very satisfactory budgetary position.