WELLINGTON NEWS

Hokitika Guardian, 17 March 1932, Page 6

WELLINGTON NEWS

LESSONS OF THE SLUMP.

(Special Correspondent)

WELLINGTON, March 16

The awful slump that we are facing is not due to an act of God, such ns plague, pestilence, famine or earthquake. It is man-made, and man must take the right steps to drive the slump away. Human nature from the start of time has found it economically difficult to accept:: economic disaster and to make thea necessary adjustments which ultimately cure it. On the contrary, efforts to talk away depression and resist any change in Vu'e ,status quo have invariably made matters worse.

in all history experience indicates that no confidence can be placed 111 artificial revival schemes and that the way out of. depression can only be the gradual' elimination of its causes, which in this instance unquestionably centres in «n unprecedented war and post-war inflation in every field of economics. Throughout the past all artificial efforts to find a short-cut to prosperity have been of infinitessimal influence as.comparative with the basic cprative process inherent in the free working of natural economic forces. It is unfortunate in the present difficulty we find it so hard to accept this inexorable fact and to apply its lessons with . patience and resignation. ~ Low ..prices have been the cause of all complaints, and they have called forth.a multitude of proposed remedies tshe majority'' of which agree on the theory that existing values a_re abnormally low, but the- way out of the economic morass is'not by means of manipulating credit and arbitrarily raising prices. The report of the Economic Committee,, which consisted mainly of economists,, practically recommended this course, with the result that there was a bitter controversy on the question'of a free currency exchange market. To have raised the exchange would have arbitrarily raised local prices, .which would have caused more trouble. It is to be hoped that the matter is now ended.

The report of the Eiconofnic Commission, and the recommendations of the Commission have giwen the community a severe jolt, but it was necessary to arouse the people to an appreciation of the, position. .The revelations of unnecessary eifctravagance are appalling and they se-sm to permeate all branches and department of the Government service. In .every business, big and small, and in every home there has been a very close inspection and all excesses ha.ve been cut away. No doubt in som.e businesses the management has acted unwisely, but that of course is their concern.

The Economic Commission has performed this introspection service for the business of the Government with the result that in the financial year 1932-33 there should be a saving of .ti,976,262, and the Commission did not confine itself to spectacular savings, but pointed out even the small savings that could be made. There has been a great growth in pensians and the growth is due entirely to political causes. However, it is now seen that they are an oppressive bur- 1 den and that is obvious, since such pensions are costing the country £3,000,000 a year with a tendency to expand. The Commission has dealt trenchantly with Parliament. and its staff. Early in the session there was a. rumour that it was intended to prolong the life of the present Parliament for another year. That would have been extravagance and a calamity.

The Commission recommends the reduction of members of both Houses. This is in 'accord with public opinion. The old cry that electorates were too large and that a member could not visit all parts is now an untenable excuse, for transport is cheap and quick now. The revelations as to the privileges enjoyed by members and exmembers are unpleasant. Bellamy’s Hansard, travelling allowances and other details show unwarranted extravagance. When Parliament indulges in extravagance, and members display grasping greed they set a bad example to the country. The reports will cause much heart-burning ■and no end of discussion, but every recommendation of the Commission is worthy of adoption.