NATION’S WEALTH

Hokitika Guardian, 7 March 1922, Page 2

NATION’S WEALTH

ECONOMICS OF FREE INDUSTRY. In a thoughtful letter to the editor of the London “Times” signed by Hugh Bell, Richard D. Holt, Gfcorge Lambert, ML Ripper, Walter Runciman and Ernest J. P. Benn, emphasis is laid on the supreme importance of a right understanding of economic matters at the present juncture. The following are advanced as points which the writers state, seem sometimes to have been almost forgotten : “Wo live by exchange. Every one of us is occupied day by day in exchanging something we possess or some service we can render for the things or services of others. Every obstacle to free exchange is a charge on the community. The freer the exchange the higher the level of prosperity. An article of a service i&’ worth what it will fetch. Any attempt whether by combines of capital or labour, or by superior authority or force or legislation, to impose an unnatural price defeats its own object. No power can force the buyer to buy So freely as the knowledge of ft fair deal. “Saving is essential to life, We enjoy a harvest because somebody had the wisdom to save part of last year’s seed. Saved wealth multiplies, consumed wealth, disappears. Every iiiducenients should therefore be giveii to save. Individualism is essential to wealth creation. Experience shows that the individual call only live by work or on past savings, a combination of the two methods producing the most satisfactory results. Collectivism sipates and eventually destroys wealth. The community acting collectively seldom saves anything. Its tendency always is. to mortgage the future and leave debts for following generations. This process, unless restricted within very moderate limits, is full of danger.

“Full economic liberty is unattainable. As producers we must be slaves to ourselves as consumers, or else as consumers we must be slaves to ourselves as producers. The producer must wait in thie marketplace to be hired, or else the consumer must wait in queues to be rationed. We must be slaves in one capacity and wasters in the other. By keeping our producer-selves in slavery we have raised the standard of living many hundreds per cent. By allowing our position as consumers to be subordinate t-o our position as producers we must retrace our steps and lower the standard of living.

The purpose of industry is to make and supply goods for the general enjoyment. The only test to its success is the mftrket test, the free and unfettered judgment of all expressed individually throuih the machinery of buying and selling. When the consumer ceases to be the first consideration with industry its true purpose is forgotten. “The arbitrary fixing of a price of anything whether an hour’s work or a pint of milk tends to restrict both the demand for and the supply of that thing. Just as in. nature the tide flows ebbs alternately so in economic affairs a natural price is always moving backwards and forwards. As a price ‘flows’ producers are encouraged to come forward and as a price ‘ebbs” buyers are attracted. In this way the maximum of activity is maintained and

all parties benefit. Rigidity discourages producers and buyers alike, and thereby limits both supply and demand.

“Every good citizen is anxious to serve his fellows, and in public discussion there is much talk of serviqe. The only true measure of service through industry is the willingness of the served to accept it. In a free market every service offered is subject to the test of public opinion. Thus through capitalism and the higgling of «the market we ensure to the community the best service.”