WELLINGTON NEWS

Hokitika Guardian, 5 December 1930, Page 7

WELLINGTON NEWS

ECONOMIC CONFERENCE... (Special Correspondent). WELLINGTON, December 3. The Leader of the Opposition, the Hon. J. G. Coates, has suggested 'that a National Economic Conference should be called to consider the economic conditions of the Dominion. He maintains that we are drifting and sees great .danger in the drift. There is no doubt about the drift and its dangers, but can such a conference tell us nothing-more than we know already. We know that prices tor our primary export products have declined and compared with a year ago wool, butter, cheese and meat are ruinously at a low level. We know that the primary producers are not only not making profits but are making losses, and many of them will be unable to meet current obligations. The plight of tlie farmers _ is reacting on the' whole community, values of all kinds of securities are sinking trade is bad, book and other debts are difficult to collect, . hanks ruptcies and deeds of assignment are increasing, and the incomes of many professional and business men have declined, and unemployment is still decreasing. Taxation is burdensome and is likely to increase rather than decrease. We know all this and a national conference, can tell us nothing new. We know'.also that the costs of production have wot fallen, but that is the job we are shirking and that is how we appear to lie drifting. We are in the same position that Australia was and still, is in.

Sir Otto Neimeyer in his.review of the position in Australia said:. “Australia has to adjust herself to a world economic situation more disadvantageous to her than in the last decade. As a debtor nation Australia is interested in the world price level and this everywhere is falling rapidly. It will continue falling. To this situation Australia has by no means adjusted herself, either as regards the situation of'primary, producers .or secondary production';” New .Zealand is just now in exactly the same position and we have taken no steps whatever to adjust affairs to conform with the changed economic conditions. The authorities assure:.us that we have overcame previous ’• depressions, and that New Zealand is a wonderful country and is quick to recover, and similar sunshine talk. Australia has listened to the same optimistic talk, but the depression refuses to show the least sign of lifting anywhere, and it must lift in Britain before it lifts here.

It seems futile to > expect produce prices to rise. The war- and immediate p@st=war prices have gone and are not likely t& return until the next war, which all will fervently liflpe will he a long way off. 1)068 anyone iti his sober senses believe that butter will presently recover to 180 s per cwt., or wool to 16d per lb., or lamb to 10id per lb ? There might be and probably will he a slight rebound from the level existing, hut that would mean bringing in profits from our produce. If the prices referred to above do not very soon return how can we go on paying the costs that were paid then?

There must be gome balance between costs and selling prices, but just now costs bear down selling prices. We must reduce costs and a national economic conference can tell us nothing more, nor yet can such a conference tell how to proceed to bring about such a for the process is obvious. In calculating costs of production it will be found that 70 to 80 per cent is. debited to wages. It is obvious therefore that there can be no reduction in costs without a reduction in wages, and that is the obstacle that the authorities shy at. This is a time when there must be sacrifices all round, a sort of co-oper-ative sacrifice for the common good. Such sacrifice is not being made so long as a selection is sheltered by the legislation surrounding the Arbitration Act. '

To make the sacrifices general the awards of the Arbitration Court must be suspended, and this suspension can be effected without the direct sanction of Parliament, for the Government can by Order-in-Council. under the powers conferred by the Bocrd of Trade Act, suspend all awards and even the sittings of the Arbitration Court. In some quarters it is believed that the Unemployment Act will relieve the situation. It is bound to do so to a certain extent, at the same time it is tending to increase unemployment. The basic wage of 14s ner day is verv attractive and it will have a bad effect on farm labour. Many employers who from motives of generosity deelined to dismiss surplus workers will have no such qualms now for the Unemployment Board must look after them. By the time the Prime Minister returns to the Dominion the position will have become serious enough for drastic action.