Hokitika Guardian & Evening Star WEDNESDAY, SEPT, l0th, 1920. HIGH FINANCE.

Hokitika Guardian, 15 September 1920, Page 2

Hokitika Guardian & Evening Star WEDNESDAY, SEPT, loth, 1920. HIGH FINANCE.

The reign of the Reform Party seems to rest for the present on high finance. How soon it will break down it is hard to hazard an opinion, but financial critics are saying that a crisis is pending. Even critics with a pro-Reform leaning are beginning to pick holes in Mr Massey’s financial methods. The methods do not tend for stability of finance because there is no real effort to provide for the future—when the rainy day sets in. The extravagance in Departments and file need for economies have been. stressed over and over again, and now Mr Massey is being lectured on the same point by some of his own supporters. The Christchurch “Sun,” for instance winds up an article on the present taxation proposals as follows:—“While giving tli3 Government every credit for endeavour- ' ing to distribute the burden of taxation more equitably, we cannot help ! expressing our regret that no member of the Government 6r the House seems to question the necessity for such heavy taxation, or advance a single suggestion for reducing the enormous cost of public administration.” This puts the position very mildly. The reproof while being on the tame side, is, however of the grcviter value because of the source whence it emanates. The friends of the Government are awakening to a sense of the dangers into which the present financial policy is allowing the country to drift. Again, more than one independent paper is deploring the absence of Sir Joseph Ward at this juncture from the counsels of the State. The financial acumen of that gentleman is being fully recognised now—even if somewhat late in the day,—and the action of Sir Josph Ward is recalled in what he did when the financial position of the country required drastic action He did not hesitate to take it. But to-day, our financial edifice is built on foundations of sand, liable to shjft with the ebb and flow of the tide marking the fall and rise in the price for staple commodities. Here, again, we may quote the “Sun” as illustrating the position in its own wayeven though the illustration is colored with its regard for fat prices for the man pn the land. Our contemporary goes on to say: “Puring the present year the Government is going to transfer some thirty millions of mpney fro;n the pockets of the people to the Tpeuand iii addition it contemplates extensive borrowing which means more debt and more taxation. In pre-War times it carried on with a revenue of about twelve millions per annum. Only one thing makes it possible for the Government to take thirty millions a year from the people, and it is because Britain and Europe are starving for our staple products and -ire paying famine prices for them. This, circumstance should in a measure reconcile consumers locally, to 2/6 for butter, because if it were not for these high prices the Government’s whole financial edifice would come down with a crash.” The admission contained in the last sentence unfortunately is all too true, but in spite of the fact that the Government know' it as well if not better than anyone else, there afe no signs of thrift on the part of the administration to prepare for the day of reckoning. And so we continue to live in a paradise of make believe, shutting our eyes to the future. Sir Joseph Ward did provide for the “crash” even when he was in the National Government by building up a reserve from the successive surplus. But no sooner was ■Sir Joseph out of the way than the nepdy Government appropriated the surplus ftijids f,or current jequirements and so five pest egg Iras disappeared.