WELLINGTON NEWS

Hokitika Guardian, 30 June 1927, Page 1

WELLINGTON NEWS

(Special to “ Guardian ”.)

BUSH ECONOMISTS. WELL IXOTON. .lime 27. W'e have suffered at times from the operations of bush lawyers, quack doctors and a host of weird wonderworkers, and we stand a good chance of being plagued with an array of hush economists who claim to have patent schemes For driving out the depression. The nostrums all carry fancy names, for there is an appeal in a fancy name, and so wo have " Paterson plan.” ‘'Cheap Money.” "Rural credits,"' ‘■Embargo,’’ "Keep the money in the country” and what not. If we listen to the dulcet tones of the hush economists anti swallow some of their nostrums the future of the country would he chaos. The depinVfsion that we are suffering from is due to the operation of economic laws. In simple truth we are suffering from depression because our primary products exported and sold iu the world's markets have not yielded snfiieient to cover the costs of produe-

IMain.lv staled production under ■sent conditions is not profitable to ■ producer, and any sane business in would say that one of two things ist he done, cither costs must be iuccd or prices advanced. To value prices if that were ssible would be tbe more iieenial task. but uufortunate-

compel:it i w market

ealimit be lorced lip. The alternative is to reduce costs of production. Inii iliis is an uncongenial task and is consequently burked. It is also

unfortunate that the political element governs the cost ol production to a large extent, for the Arbitration Court is a gill by Lite politicians to the country, and the Court s orders must, lie obeyed. Economic laws are much more adamantine than Ihe Arbitration Court's laws and economic laws must prevail.

The costs of production must be roiccd, and all the cry of "scat)” lges. lowering the standard ol liv-

ng and such catch phrases will not vail us. Our welfare depends upon Halting a profit out of our primary i rod nets and that profit must be nade. Some bush economists have he::>me obsessed with the idea, that the Nilorson plan of taxing one section o subsidise another will enable us

to establish new industries. The Meat- Control Board lias apparently endorsed this plan in respect of beef production and at the first meeting of farmers held in Afasterton to whom the scheme was submitted by a member of the Board, it was turned

down promptly. Alt- AY. Berry, of the AYairarapa. who is believed to ho the principal advocate of the scheme, explained to the farmers in Afastcrton that the

proposal was that on all cattle killed for local consumption and export, with the exception of boneless beef, a levy of ',d per lb be paid by the grower and an amount of id per lb would bo paid by the Board on all beef exported in quarters. This means that the grower will pay the levy and the grazier will get the

The ‘‘Mercantile Gazette” in its last issue, under the caption ot "Beet Production,” says;—"The expott ol beef to the United Kingdom from New Zealand is unprofitable, because London prices do not leave a margin above costs of production and marketing charges. That being so. it is obviously our duty lo examine into those costs and charges, and endeavour to find nays and means ol reducing them. This is a matter that cannot he overcome with palliatives and Paterson plans, wo must get at the root cause of the trouble and apply the light economic remedies. AYith respect to cheap money, the bush economists have given us some remarkable schemes, hut the one submitted to the Gisborne Banners' I nion must surely be awarded the prize, ft was submitted tv a fanner who contended tlia cheap money is money below the normal rate «f interest. He therefore suggested that the Goternincut, should borrow in the open market, apparently on mortgage bonds •it av O'. per cent, relend the money to the fanners at 4 per cent. the Stale to pay the balance ot the mtorest. , , U innv bo pointed out that the Government lias no means of paying the interest except by taxing the pconlc. and so the difference between the 1 per cent and Gi per cent would come out, of the pockets ot Llic taxpavers. But this hush economist can sec a way of protecting the Government. When a mortgage properly i> sold the first charge on it should x the amount paid in interest by Ur Government on the lo.m. schemes of high finance must be i ~hror delight to the economist! amongst us. hut they are dangennr for the taxpayers. Tt is niiderstom that Mr \Y. •). Poison. Don.man President of the .banners' Union. ' hatching a rural credit scheme thn will solve the financial difficulties.