The Sun 42 WYNDHAM STREET, AUCKLAND FRIDAY, FEBRUARY 15, 1929 NO CAUSE FOR ANTAGONISM

Sun (Auckland), Volume II, Issue 589, 15 February 1929, Page 8

The Sun 42 WYNDHAM STREET, AUCKLAND FRIDAY, FEBRUARY 15, 1929 NO CAUSE FOR ANTAGONISM

THE president of the Chamber of Commerce was not very happy yesterday afternoon in his references to the manufacturing industries. In a somewhat patronising tone he stated that the Chamber wished these industries all good luck and prosperity, but members must not “lose sight. of the fact that the well-being of the community depended upon the prosperity of the primary industries." The implication is obvious. Mr. .\[erritt then proceeded to make some vague generalisations regarding the cost of production. and went on to say that “an indiscriminate use of the Tariii' would unduly raise production wrists and result in a decreased exportable surplus." This has a very familiar ring. Similar platitudes were uttered by long-dead opponents of the industrialisation of tho lfnited States; they come echoing down the years of fiscal con—troversy in Canada and Australia and still do duty wherever importers gather together to eat Chamber of Commerce dinners and make speeches about the. business outlook. It is not “lack of sympathy” that local manufacturers need complain about: it is lack of understanding. No one denies that the prosperity of the farmer is desirable; it is equally true as it is trite to retort that the well-being of the community also depends on the prosperity of industries that are disbursing over £17,000,000 annually in wages to persons directly employed in them, and incidentally provide importers with customers. but for whom many members of the Chamber of Commerce would soon go out of business. This line of argument. however. is more recriminating than helpful, and we have no desire to indulge in it. Still. we are bound to point out. to Mr. Merritt that no mcm‘ her of the Alanufacturers’ Association, or any other person of intelligence. asks for an “indiscriminate use of the Tariff.” \Vhat the association seeks is a, Tariff Board, before which the representatives of any industry could go and state a case for tariff assistance. Parliament has afi‘irmed the principle of protection :: it would be the function of the proposed board, after careful inquiry. to recommend the extent to which the principle should be applied in individual cases. Tn spite of what Farmers’ Union ad vooalrs say. protection has not materially increased the eost of primary production in New Zealand. Labour laws and restrictions regarding employment have had much more to do with rising farm costs than duties imposed for the purpose of fostering local manufactures. Protection is designed to increase the cost of imported goods and decrease the cost of locally-made goods by giving the local manufacturer :1 larger turnover for the same overhead expense. The chief factor in the cost of primary production is interest, on capital, beside which the influence of tariffs on the firice of food. clothing or household necessities is trifling. If a man desires: to get a modest. living as a sheep-farmer in a small way. a t‘npital investment; of some £B,OOO or £9,000 is necessary; if he prefers mixed farming—fattening lambs and cropping—he can get along with about £5,000. while if he is content to milk cows. he can keep a i‘atnily in reasonable comfort on a place costing some +£3.ooo,‘iucluding stock and so on. Few farms are unencumbered and in thousands ol’ instances three-fourths of the capital. is borrowed.

It is obvious. therefore, that one per cent. in the rate olf interest is of far greater consequence to the farmer than whether his boots cost him 205 or 225 6d and his suit five pounds or five guineas. It means anything from £3O to £9O a year, according to 1110 value of his place, and incidentally helps to explain why a politician who dangles a scheme for bringing E 70,000.000 into the country at a low rate of interest is deemed m-efembie to a cold-blooded economist who increases the incometax

But, every married worker engaged in factory production must of necessity spend at least £75 a. year on food products raised in New Zealand The primary industries are struggling hard to-day to liold their own in fiercely competitive markets abroad. Every additional industrialist who can be employed in making goods here instead of importing them is a permanent and free spending customer of the farmer, the retailer and even of the importer whom we desire to convert eventually into a Wholesale distributor ol" New Zealand manufactures instead of foreign merchandise. if members- of the Chamber of Commerce would try to realise these facts. they would soon see that there is no 'l'uudamental antagonism between the manufacturers and The iiiiptn‘?ei':<.