WELLINGTON NEWS

Hokitika Guardian, 22 August 1930, Page 2

WELLINGTON NEWS

GOLD SUBSIDY. ! i . (Social Correspondent.) WELLINGTON, Aug. 20. The output of gold throughout the World lias been -steadily ; shrinking for*'the'-past fen* years, and this is: one of tjie’causes of 'the -fall'" in'•commodity ' values... : Mr Joseph Kitchen, an accepted authority- on world gold production, estimates that the supply, of yellow metal will not expand by more thane 2 per cent, While Professor Cassell, the Swedish economist, estimates that to take care of the trade of the world it will require i a ■yearly, increase of 3- per cent. , On the other hand, Professor Benjamin Anderson, an American econo-, mist, considers that there is ample gold to carry the trade of the, world if the ..banks held their resources very liquid. However,' the output of. gold is contracting and this has induced mining men in Australia and New Zealand to advocate Government support for the industry. In Western Australia, it has been a live topic for some time past, the proposal being that the Federal Government should subsidise the Industry to the extent of £1 per oa. In view of the present parlous condition of Australian finance there .is

not the slightest hope of any assis2'tance being given the industry, -In® V idea of a subsidy has extended to NeW'Zealand, and Mr John McDonald', of Dunedin, in- an open letter to the Prime Minister, suggests something very similar, but . his proposals could not be entertained or a -moment. His proposal, to use Ins own words is: “A forward sale of the Dominion’s gold to the Bank of Eng land over a period of, say ten years, at a price of £1 in advance of the present (price of gold; the Dominion in return foregoing any duty on mining machinery imported from Great Britain.” .And this, proposal,' Mr. McDonald thinks, should have much to recommend it to the Empire Development Board. Mr McDonald fails to maii cate how the Bank of England is to be made to pay £1 in advance of present market prices for gold, that gentleman apparently thinks that the British Government by Act of Par- . liament could compel the Bank of /England to act so foolishly. r lhe : Bank of England is a joint stock company but it acquires great pros : tige because it .has, 'been banker to the Government practically since its

foundation over 200 years ago, it- is nevertheless a private, concern, and s like any other bank must endeavour to turn dividends for its shareholders, Its weekly profits fife shown in the item-4 e«t_, Tliis part of Mr McDonald’s scheme must be jettisoned. for it- is .both , absurd and unwork? able, ' But, in developing his; thesis Mr McDonald proves that a subsidy or the payment of an inflated price- foi gold is unnecessary, for he states that the report for 1929 for the Alask Junneau Mine, Alaska, shows a good profit on stone gong 4s Ifd a ton, in a country paying the highest wages and experiencing the worst weather. This Alaska mine is not receiving £1 per oz in advance of the present market price which is £4 4s lljd per oz fine. If this amount pays in Alaska it ought to pay in New Zealand. i\~

To-day we have, speaking, improved transport facilities, improved machinery and all the facilities afforded by electricity, and if, with all these improvements the mining fraternity cannot make low grade ore pay then there- must be something wrong. The Alaska mine makes low grade stone profitable, and pays the highest wages, while experiencing the worst weather.

There is still plenty of gold to he

won in New Zealand, 'blit what is , lacking' is that spirit of enterprise land, courage that characterised the old colonial days. Fossikers of those days ventured out into unknown country and walked many miles of the way in their search after the yellow metal. Some were lucky in locating alluvial deposits or rich reefs; some were lucky but most cf the intrepid men drew blanks. That, standard of ■ miner does not .exist to-day, and if by any chance some of the younger generation took up the role of fossikers the cost would be too great, for they would bring into play the modern policy instilled into workers by labour leaders. Mod- v ern fossikers would want award wages, two days off in every seven, a cook to provide savoury meals and they would not cover one-tenth of the ground the old-timer would have done, and he would have tramped the dales and hills on grub-stake and a little necessary equipment. Taxpayers cannot afford any subsidy for the mining industry. >