THE OTAGO DAILY TIMES FRIDAY, AUGUST 1, 1919. "A RED LIGHT."

Otago Daily Times, Issue 17692, 1 August 1919, Page 4

THE OTAGO DAILY TIMES FRIDAY, AUGUST 1, 1919. "A RED LIGHT."

Tiie grave terms in which tho King, speaking at tho Guildhall, has emphasised the urgency of the exercise of economy and of devotion to industry as a national duty recall the admonition to wake up" that was addressed by his Majesty to the business people of Great Britain seventeen years ago on. his return from his Imperial tour. What has been said by the Sovereign on the present occasion is less striking than the speech in which in 1902 he pointed to the desirability of a revision of the commercial methods and practices of the United Kingdom, for statesmen, economists, and publicists of all degrees have been strongly insisting for months past upon the need for the exertion of a. powerful and united national effort— an effort involving something of the spirit of sacrifice that was widely manifested throughout the war—in order that the penis of the period of reconstruction may be successfully overcome. But probatky the value of a "red light;" exhibited by the King, is considerably greater than that of any similar danger signal that may be displayed by a person of less exalted rank. It is certain in any case that his Majesty has performed a public service of great importance in prominently directing attention to the absolute need there is for the community to contemplate seriously the conditions which represent the aftermath of the war and to apply itself equally seriously to the task of the rehabilitation of national finance and national industry. " The world is living on its capital— not of cash but of commodities: part of it because that is the only way in which it can live at all, the rest of it because it is in a hurry to live better than of old." In these words, a writer, Mr Francis Gribble, diagnosed the case in a recent magazine article. "The more prosperous part of the world," he continued, "does not realise what it is doing partly because its eyes have been blinded by the inflation of the currency, partly because the task which it has set itself is that of compelling profiteers to disgorge. Meanwhile it dances and makes merry, as they did in the days before the 1* lood—in the hungry countries no less than in the countries which have not yet begun to know hunger, and meanwhile also the stock of capital approaches exhaustion and tho day of the scramble draws nearer. And that," he added significantly, "is the end of civilisation." The tendency towards relaxation after the strain of the war was natural and inevitable. For nearly five years the world existed under conditions of exceptional stress. It was in need of a holiday when the cause of the stress was removed. But the war has had the effect of almost stripping the world bare. The proof of this is provided in the fact that many countries are at the present day on the brink of famine. In others the prices of the necessaries of life continue at a seriously high level. In Great Britain the system of rationing certain food supplies has to be maintained nine months after the date of the termination of actual hostilities. There is a clamant need for increased production. And production can be accomplished only through, as the King fittingly says, "unremitting industry,"— unremitting industry at a time when the demand of the workers is for increased opportunities of recreation. The plain fact is that Europe is greatly ■ in need of raw materials, of machinery, and of manufactures as well as of foodstuffs, and goods can be produced only by work. Work or production, or whatever else it may be called, has been justly described as the keynote to the whole situation. Every increase in the volume of world production means that additional goods will be available for world consumption. "It is," as i one authority expresses it, "the volume | of goods produced that counts, that ; makes for a decent standard of comfort I and an increase in real wages. The wages paid per hour and the number of hours worked per week are immaterial ; it is the number of items produced for each unit of wages and tho j number of items produced in each week of work that really matter." Along with concentration on increased consumption must be associated retrenchment in the expenditure of public money and economy in the expenditure of private means. The Economist declared in a recent issue that it " looked in vain for satisfying evidence that the orgy of war waste has ceased or that the megalomania of bureaucracy has been checked." A public debt "fantastic in its monstrosity," to quote Professor Gilbert Murray, is one of the legacies of the war in Great Britain. The net borrowing by the Imperial Government from August 1, 1914, to March 31 last totalled £6,801,000,000. Included in this gigantic total is a sum of £1,683,000,000 advanced by way of loan to Allied nations, whose prospects of ability to repay the amount.may be more or less doubtful. And what does this huge war indebtedness mean? "It means," in the words of Mr E. Hilton Young, M.P., "that an equivalent amount of the nation's wealth in material and labour has been withdrawn from productive industry, from trade and commerce, and has been placed in the hands of the State, for the purposes of the war, in return for a charge upon the taxable capacity of the nation. That wealth now exists only in the fragments of iron which are scat/torod over the battlefields of the world, in the particles of explosive gases which aTe distributed in its atmosphere, and in similar unmarketable articles. It is gone, and gone for good." And while the vast amount of wealth, represented by the war indebtedness, has been destroyed the nation has, through a tremendous excess of imports over exports, been overspending its income to an enormous extent. The only way by which it can be restored to its former state of financial freedom and independence is by rigid economy, particularly by economy in the consumption of luxuries, so that goods and labour may be set free for the expansion of the export trade. Within certain limits what is true regarding Great Britain ig true also regarding New Zealand. The dominion has incurred a war indebtedness of re-

latively great proportions and has undertaken the payment of annual charges which must press heavily on tlio taxpayer. During the years of war the high prices which were received for the products of the dominion and the expenditure of considerable sums of loan money in the dominion contributed to the existence of prosperous conditiojis. But there can be no certainty of a continuance of the outward prosperity which the country has enjoyed. The likelihood that a period of comparative dulness may occur cannot bo disregarded. But the charges on the war debt and the pensions payments, constituting the addition made by the war to tlio financial obligations of the dominion, must be met together with all the cost of all the ordinary services or government. And it is highly necessary that the production of the country shall be increased and that both private and public economy shall be exercised lin order that the country may be in a position comfortably to discharge its obligations. It remains only for us to add that, with possibly critical times ahead of us, the existence of the dangeithat, through the revival of political animosities of the past, the balance of parliamentary power may be placed in the hands of mischievous extremists is one which should provoke the strong resentment of all reasonable members of the community.