The Guardian And Evening Star, with which is incorporated the West Coast Times WEDNESDAY, FEBRUARY 15, 1933. UNBALANCED RELATIONSHIP.

Hokitika Guardian, 15 February 1933, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times WEDNESDAY, FEBRUARY 15, 1933. UNBALANCED RELATIONSHIP.

In considering what conditions are Juteiy i.o prevail a. year lienee in inti i,'i.,;it. .a, U...; ti'acie, a Hi i ted States journal pouits out the chief an.vi c ty is the extent u> wnich government's and people will accept a..d act m aetouti with the' economic principles which are the I'.as.s of a highly organised society. A'iie fallacious aigun.ents employed in former depressions are being iput forward as reasons for seeking some mtner way duo of vhii* one than t,.p way of trade and price adjustment, 'but no ground exists for believing tua-t tuore is any other way. it- is stated that the price Lvel will not recover, or that the world is ail developed and there is less work to be done, or that the machine lias put men permanently out of work; and these are given as reasons for tinkering with the money standard, or for | u.n.,.v/.ring other panaceas proposed. I None of the e arguments L new to economic history. They recur regularly in every depression, and are as regularly refuted by the outcome. The responsibility for .present conditions does r.ot belong to the gold standard or the monetary, system, or to any ether of th e facilit.es which civilisation lias evolved to rai-c its living standards, but to the disrupton of ordinary trade and price relationships, and 'the remedy is not through altering the facilities but by remov.ng the causes of the disorder. Organised society is essentially a co-operative system subsisting upon an exchange of goods and services between its individual roc nbers. It is a voluntary system based upon individual freedom, and when the 'accustomed basis of exchange is destroyed the flow of trade is disrupted, and exchanges must, he restored by the co-operation' of the members of the society, both as individuals, or where, joint action is necessary, through governments. The budget needs to he 'balanced to maintain confidence and the regular flow of capital. Economies in all government expenditure are imperative, Thpse remarks apply as aptly to New Zealand as to.the United States, and the case for the situation is the same in all countries, Produce prices are readily affected by the market demand —much more so than individual costs; and it is the inability of the former to buy which is depressing employment for the factory worker, and so the . evil of unemployment revolve® in a circle. Affectum 4 O price levels is the financial position of the buying country. The market in that territory is affected one way or the other by existing conditions. It is recognised now that huge dob's, the legacy of the war, sit heavily on some of tlie principal buying nations, and as a consequence, trale is restricted. The pre-x-mt movement to adjust a debt settlement which will go a long way at least to relieve the tension, is the surest methods of lifting price levels. It would appear ,the United Staten will bargain with her debtors on those lines, and it is just the delicacy of this adjustment which will bring hope or otherwise to the heavily burdened nations.