The Guardian And Evening Star, with which is incorporated the West Coast Times. MONDAY, DECEMBER 19, 1927. EARNING AND SPENDING.

Hokitika Guardian, 19 December 1927, Page 2

The Guardian And Evening Star, with which is incorporated the West Coast Times. MONDAY, DECEMBER 19, 1927. EARNING AND SPENDING.

Ar,niV)-;:.it not so hiucli is being hoard from the lieiuls of the banking institutions and other financial concerns as to the need for moderation in expenditure .the voice of the more frugal ono is not by any means silent. Last week, Mr \V. J. Poison, prominent in farming circles, tool; up the subject nlid did not mi lice mutters: Aiid there was no occasion to do so. 'I he general financial outlook is such as tit warrant greater frugality in the matter (if expenditure. Mr Poison went on to show that the country was living beyond its means, and that riot of expenditure could have hut one end-

ing. The country relies on products to meet the general financial situation, hut Mr Poison said production was not increasing and the burden, of taxation was growing. What is happening here was stressed also in one of the Australian Stutes—the country was borrowing to meet its interest hills ! That is a case of burning the candle at both ends—and hastening the end. Mr Poison did not qualify the plain facts to any degree. He said with brutal frankness that the Dominion was living beyond its means at the rate of no less than ten millions a year, and borrowing five millions a year to keep up appearances ! The Government is ready to borrow at the first and every opportunity. In the session just closed the Minister of Finance took authority to borrow money, which it was dieted by Sir Joseph Ward in the debate, was not required. There appears to be a looseness about such a policy it is difficult to understand with a party which sought power on the plea that borrowing was to lie curtailed. Not only hiis the Government borrowed year by year, whenever the market was believed to he favorable, hnt it has reserve jio'ver to !>orrow- still more if op|>ortunity crops up conveniently. That is hardly a statesmanlike way to handle the financial situation, and suggests a degree of freedom which is disquieting as regards efficient or effective control of the finances. The pr<>i<or. control of the Dominion finance continues the chief matter for concern in regard to the national welfare, and it is surprising more attention was not devoted to the subject during the late extended ses-

sion. It is clear from Mr Poison’s scathing references to the Government met hods of administration, which he describes plainly as extravagance, that the subject is not escaping the attention of those outside Parliment. and it would be well if the warning to the people a a whole became more pointed still. The borrowing and pledging of the country’s credit has not been confined to the general Government alone. Local government has dipped deeply into the available treasury chest for local loans mounting up to a huge scene in the aggregate. There has been for some time now* an orgy of scatter cash <lue to public and local borrowing. A definite oheek is being placed on local bodies’ efforts in that direction, but the curb should have been put on much sooner. The great outlay of easy money produced a false degree of prosperity. and this is revealed now in the unemployment prevailing throughout the country. Large works undertaken on borrowed money have been brought to fruition, and the labor that was necessary is being dispersed. The rush to spend the money as quicklv as possible created a false labor market, both in value and volume, and the country is not settling down to the reaction when the pendulum swings back to the normal pace. As q. matter of

fact it is rather subnormal now, hence the stringency which creates an army of unemployed in the centres at the time of the year when there is usually work for all. An artificial situation was created, and the Dominion 'entered into a very foolish paradise, the glamour of which has now passed away. It would be well, therefore on the threshold of a new year to take stock of the real position, and seek to steer a course by which matters might lie retrieved. and not become further involved.