LACK OF ENTERPISE

Hokitika Guardian, 20 July 1929, Page 2

LACK OF ENTERPISE

ti • (BY ,T X.”) The latest banking returns show - that in the June quarter , the banks had an even heavier surplus of funds than in the March quarter, the excess of deposits over advances being over nine and a half millions. A\ lule it may be a matter for regret that such large amounts Bhould be placed on deposit with the banks instead of being utilised by the owners in industrial and other channels, the reasons for. such apparent lack of enterprise are not far to seek. Legitimate .channels for investment have one after the other been closed. Mortgages on. land—what is known as real estate—have owing to land values inflation proved a delusion and a snare. Building houses for tenants to live in has been regarded for years as a fool’s game, and in the larger centres the capital cost of good house property is sometimes far in excels of the rental value of such property. Industrial undertakings have long been regarded by the investor with Buspicion owing to- the unsettled labour outlook, the limited local market, the keen and sometimes unfair Competition, and the uncertainty as [to what fresh restriction may at any ■time be imposed by an Arbitration Court which does not maintain economic principles. The investor, finding these channels ’closed, for the present at least, and until such time as confidence can he restored is simply taking the only course open and depositing money with the banks, Government departments, or such financial institutions as can give guarantees of security. The apparent lack of enterprise is onlv tho effect of lack of confidence and until the cause for this is removed the locally owned money in the country cannot be expected to circulate freely. .' , While it is true that this lack or confidence can he largely traced to the policy of the political party which has now been removed from office the! change of Government in itself cannot, bo expected to immediately rc-act on tho public mind to any material extent. Those who have su.fered losses—in some cages seeing the savings of a life-time swept away in whole or in part-are naturally careful that the residue they may have left shall not also disappear. Perhaps the-most conservative in this way are the workers themselves—the tforker-capitaligtß—as shown by the

in . I large increase in savings bank cltw posits. It would be found, if a return could be prepared that very few employees invest money in concerns ju which they a-re employed. The ( small. investor probably goes in lor Building Society shares and the larger investor for bank and insurance shares,' but with certain exceptions industrial stocks are at a discount. This must continue until such time as the attitude of the Government toward industrialists is defitned more clearly and the effect of the Arbitration (Court ipwards on industrial problems more thoroughly investigated.

The most vital problem—or perhaps I should Bay the problem claiming precedence—is increased land settlement. If a practicable scheme of smaller holdings and more intensive cultivation can be evolved and carried out it will provide an outlet for surplus labour and also surplus capital. There are however many difficulties to ibe overcome. Though the problem is in some respects similai to that which faced the BallanecSeddon Government over 30 years ago the conditions have changed. The land has now to b® sub-divided into much smaller areas and experience has shown that it is in many cases disastrous to put people on the land who have had neither experience, education, or training necessary to make settlers. A land flowing with milk and honey is no. good to those who won’t milk cows or keep bees. Tbe problem is now a two-folcl oneland for the people, and people for the land. The present education system has apparently failed • entirely to inspire incentive to the rising generations to develop into settlers. In the past 30 years the town population has increased out of all proportion io that of the country, and the attractions of city life are proving too graat to allow life in the country to have any appeal to those brought up amidst the glare, bustle, extravagance and feverish pleasure of the artificial life of the cities. To make matters worse the wretched fiasco of the soldier settlement • schome of the Massey Government has had a paralysing effect on land settlement proposition. But the question must be faced, together with tlio industrial and educational questions with which it is insuperably connected, if the present disinclination to invest capi • tal, and the consequent unemployment is to ibe overcome. It is doubtful it will not be necessary to make fuller investigation into matters affecting the pr:-

education system, the taxation sysmary and secondary industries, tli.! tern, and the land question; also io make full investigation into the undeveloped mineral and other resources of New Zealand before a definite progressive policy of development can be brought down. The country has been allowed to drift for the past seventeen years or so and the re.su 1; is now seen in stagnation, unemployment, . and worse than all lack of confidence. Confidence must ho restored before private enterprise will again show that initiative on whiji the prosperity and well-being of tlie country is dependent.