SLUMP LESSON

Rotorua Morning Post, Volume 2, Issue 362, 25 October 1932, Page 6

SLUMP LESSON

what it teaches DEPRESSION PAVES THE WAY TO FUTURE PROSPERITY. MASS^Y'S FORESIGHT. Speaking at Palmerston North Gitizen's Club luncheon rceently, Mr. W. A. Waters gave his audience a retrospective view of slumps. "An American writer," he said, "had stated recently that there was one bright spot about slumps and depressions — they paved the way to prosperity. An I analysis had shown that a. slump always followed a boom period, panic then setting in and causing a depression. Fifty years ago an authority had forecast a depression during the present period, but had exp-lained that it would touch the bottom in 1931. The present depression was worldwide, but in one respeet the world had learned from America the fallacy of collaring all the gold and erscting high tariff barriers. The speaker recalled that the late Mr. .Massey, when Prime Minister of New Zealand, had intimated liis intention of tapering off expenses "because history went to show that after every | war a period of depression followed." It had been pointed out that this had been experienced in the Dominion in 1921, but Mr. Massey, in his wisdom, had deelared that yet another slump was to come. Causes in New Zealand. New Zealand's trouble had commenced through lower prices being offered for produce at Home, a period of borrowing following. There- was now the peculiar spectacle of 70,000 men in want in a land of plenty. The position was the same the world over, and it was noticeable that at such a time of panic anything showing an avenue of saving was attacked. The speaker cited the Arapuni hydro-elec-tric works, and deelared that there had not been as much sunk there as had been losfc by the public's investments in wildcat schemes of companies that had never reached maturity. Appalling damage had been done by the Napier earthquake, but the total monetary loss did not equal the ' amount lost by farmers in their wool cheques over two years. Mr. Waters referred to the matter of cutting expenditure, and gave instances where local bodies had been extravagant. ' He added that there were 677 local bodies in the Dominion at present. In 1886 there had been 63 counties, whereas in 1926 there were 129. However, the matter of expenditure was now largely curbed by the Loans Board. Workers Discouraged. In New Zealand to-day there were skilled men, both from trades and professions, wasting their time on strange and useless work. They were becoming discouraged, while the Unemployment Board had dropped the 4A scheme because it had been abused. Many people blamed the banks for the depression, but this was not the case. In fact, the one bright spot in New Zealand was that the banks were in a remarkably sound position, and their stability had never been questioned. In conelusion, lvir. Waters said that he did not believe in too much economy, because it meant that more men were being put out of work. It did not matter in which trade or profession a man worked, he had to spend years of labour in securing experience for an executive position, but the present democracy seemed to point to the fact that anyone coula control the country. Men had to be trained for their work, and other countries also b'elieved that those controlling the destinies of the people should be fully trained in eeonomie and political life.