Alberta's Example

Hawke's Bay Herald-Tribune, Issue 189, 27 August 1937, Page 3

Alberta's Example

E.

MARTIN.

— My attention has been drawn to a leading article in your issue of the 21st inst. on which I should like to comment. You infcr that the Government of New Zealand is likely to follow in the footsteps of Mr. William Aberhart of Alberta. Is thero any sane or sound reason why the control of the people 's credit siiould be left in the hands of a pi'ivate company whose maia intcrest lies in producin^ diVidends for their shareholders and not in promotihg the welfare of the conimunity? In times of erisis the resources at- the command of 'tlie banks, which you r'efer to, invariably proves ' to be nil. The Bank of England, on several oecasions, has been reseued from insolveney by the Government of Britain coming to its fescu'e with the people 's credit. Although the directors of the Bank of England took no part in producing^ the "real wealth that formed the baeking for this credit, they insisted that it should be issued through that institution, and it was later ient back to the Government at a high rate of interest. There are a large number of mone-. tary reforiners in this and other countries who have made great sacriflces in an attempt to .imprqve the conditions of the people and not on pulling others down, as your article infers. God forbid'that the peoples of the world should sink any lower than they have in the last deeade. How is it possible to go on much longer under the burden of increasing debt? According to Mr. A. N. Field the National Dcbt of New Zealand in 18,8.5 amounted to £33,000.000. The average rato of interest since that date has been 4J per cent. Thlrty-thrce millions at 4J per cent. for 50 years ainounts to £297,000,000. It malces one shudder to think what our £2SO,000,000 odc( of debt will amount to in another fifty years. Since federation, Australia has paid £871,000,000 in interest alone. paid nothing oflf and added another £1,000,000,000 to the principal. With an interest bill tieking np at the rate of £110 per minute and population almost at a standstill what is before the people of Australia? The same applies to all countrics working under the wonderfulfsystcm of "sound finance" iiicludlng Great Britain witli an interest bill of £1,000,000 per day. Everything the nation ereates. under sueh a system immediately becomes a liability instead i of an asset belongmg to the people who • create it. As to the stability of the country's flnanccs, both public and private, I . might ask if there has evor been any , 5

I lengthy period of stability. Booihb and slumps appear to be looked on as an Aet of God or a product of Nature. I would ask if it is reasonable to support a sysfern which ereates all money as a debt, repayable only by a larger debt and at the same time to complam about the burden of taxation? I would like to state that I favour no partieular party. Tho movement for monetary reform owes its strength to the fact that it knows no class distinctiohs and its followers are preparcd to support anyone who is prepared to bring about the changes necessary to bring prosperity to a world which has never known prosperity and to remove the f ear and suspicion which exists between the nations of the world. Thiscannot be done by clinging to old ideas or to a monetary system which lags behind a productive system by several centux-fes. In conclusion let me quote New Zealand 's greatest banker, who stated: "It is the duty of the State, and the State alone, to produce as much eurrency as the community needs." Thanking you. — Yours, etc.,

Napier, Aug. 25, 1937. [Our article did little more than draw attention to the similarity between the promises made by Mr. Aberhart and those made by Mr. Savage and his followers. The diiferenee lies mainly in the fact that Mr. Aberhart knows that the 'people of his country -will not stand for any more taxation, whereas Mr. Savage h'as not yet reached that stage. Mr. Aberhart is now embarking upon his big Social Credit experiment. The New Zealand Labour Government is°not yet prepared to take the risk of that experiment. Mr. Savage prefers to wait and see what happehs to Mr. Aberhart. Our correspondeat's letter follows the already well'-kno'wn 'arguments „of. monetary reformers, whose ideas have become articles of faith against which it'.is futilo to contend.— Editor.]