RELATING COSTS TO PRICES

Hokitika Guardian, 27 February 1931, Page 2

RELATING COSTS TO PRICES

PROBLEM OF THE WORLD

AIR MACDONALD DISCUSSES ECONOAIY.

( Ihit ish Official Wireiess.)

RUGBY, February 25

The Prime Minister, Afr Ramsay AlacDonald, who visited the heavy section of tho British Industries Fair nt Birmingham yesterday, was the guest of the Birmingham Chamber of Commerce at; dinner last night, when lie said that he was much impressed by (he optimistic note prevailing among the exhibitors, .

Referring to the general outlook, Mr MacDonald said that the present problem was not one of production, which was more efficient in the world than ever before. There was also no problem in consumption, the people being prepnred to consume more than they had ever consumed before. Where the fault lay was that between production and consumption something camu in. Prices got dislocated, and for some joa, son or other the primary producer could not get prices that enabled the factories to get busy. Until they laid their heads together and 'discovered how production and consumption could bo related to each other more directly, those groat factors would continue to disturb the markets of the world. That was the world problem. “Within that world problem,” Mr MacDonald continued, “there JR a national problem, Our taxation Is heavy', deplorably heavy, half of it is necessary to keep the nation’s word ns its bond, and the other half is subject to public opinion which is intelligent enough to appi’ove a policy,” The Housp of Commons, with the consent of the Government, had set up a committee to review public expenditure. The sneaker liouecT that that committee would be expeditious in its work, The Government were so convinced of the importance of expenditure that there would be no time lost in getting that committee into working operation, Abuses must be pruned nut, buf cuttings must not be made by J’ule of thumb, they must bo suitable in the moral sense, as well as production JU their economic results. In the matter of economy they had to remember that they wore fnced with f! double-edged problem. Economy did not JJjerely mean saving, it meant expenditure of the right kind. Expenditure and wise saving where the two aspects of economy, because in times like those prevailing the country ought to bo prepared for expansion of its resources and for increase in effi. ciency,