LABOUR'S FINANCIAL POLICY.

Hawke's Bay Herald-Tribune, Issue 79, 20 April 1937, Page 4

LABOUR'S FINANCIAL POLICY.

For a week or more a wordy skirmish has been going on in which have been engaged the London "Evening Standard" and Mr F. W, Doidge, on the*one hand, and the Hon. W|.. Nasb, our Mirtister.of Finance, now in the Old Country, 'and ' the Hon. P. Fr.aser, acting as his deputy here, on the other. • As indicated by one of yesterday's cables, another conihatant has now enlisted in this little verbal melee on the side of our Labour Government. This is the London "Daaly Herald," a journal of very decided Socialist proclivities, with which Mr. Nash, as Well as dur High Commissioner, Mr. W. J. Jordan, no douht keeps in very elose contact. The subjects ostensibly under diseussioii are the financial policy of our present Government and its effect upon the external "credit" of the country. But in all this wea|ry waste of words can we find any inkling from either side as to what that policy is ? What most readers will wonder is as to how these disputants can find so much to say about a thing that, as falr as the people of this country have been told, has no real existence, The questiofis which thousands of people have been asking for many months now are whether the Government . actually has any financial policy and, if so, what it is. To ' those questions they have been afforded no coherent or intelligible answers. We have had broadcast by members of Cabinet, from the Prime Minister downwards, a lot of generalities that really signify nothing and of more or less confident assurances that everything is going swimmingly and will turn out all right. But beyond this nothing from the ministerial oracles as to how the wonders are being worked. As with most oracles, both.ancient and jnodern, the great thing would appear to be to maintain an air of mystery and carefully avoid definite disclosures. The result is that the impression is spreading rapidly that the Government has either no financial policy at all or is very much afraid to uncover it. When before the electors Labour leaders and Labour candidates emphasised the importance of finance as lying at the root of all they were going to do for the people. We were then told that, if given control of the "national credit," they would perform miracles with it and that there would be no need for increased taxation or further borrowing. Yet,having attained to the Treasury benches, their very first Budget reVealed the imposition of new taxation to bring in a couple of million for pension purposes and an aggregate collection— leaving out unemployment taxes — some £4|-million in excess of that of the previous year under the National .Government. Then for publie works £6-million was to he found by borrowing and another £4|-million from the Consolidated Fund, another name for taxation of one kind or another. It is certainly not from this that we can deducet any ' novelty in the new Government's financial policy, afnd from that day in August last up till the present moment neither Mr. Nash, nor the Prime Minister or Mr. Fraser. acting in succession for him. has let us any further into the secret. What Mr. Nash may have been telling them on the other side of the world cannot of course he said here, and possibly he has taken them rather than his own people, those chiefly concerned. into his confidenee All that can be said is that so far as his sayings and doings since reaching London months ago have been reported to us he has maiutained a possibly very discreet silence as to his intentions on this declaredly vital point. If, as seems likely, for any information at all upon fhe

Government's financial plans we shall have to waat for another four or five months until Mr. Nash presents his second Budget, then it may definitely be said that he is doing a very poor service to the country. Until the Government's own financial intentions are known it is quite out of the questtion to expect private capital to embark upon productive wage-paying enterprises. If it is to come into competition with an unlimited flqod of paper money pumped out of the Reserve Bank at a purely nominal rate of interest, then it will most certainly embark itself for overseas, where it will be allowed to operate in a free market— and where a good deai of it hais gone already. We here in New Zealand are in no way greatly conceyned jusfc now about the country 's credit abroad. Mr Nash has. quite rightly no doubt, declared it to be perfectly sound. thus paying an unconscious and unintended compliment to the National Government that maintained it in that position through the stressful years of the depression, What they are, however, concerned about. and very deeply concerned, is the conduct of the country 's internal finance. Until we know the basis npon which that is to proceed there can be no hope of our deriving full and lasting benefit from the better times npon which the world has entered