Farmers and Manufacturers

Sun (Auckland), Volume III, Issue 666, 18 May 1929, Page 7

Farmers and Manufacturers

an unfortunate deadlock facts shatter free-trade THEORIES rT unfortunate that the happily- : I conceived idea of our primary and ',i ar v producers meeting in a of round-table conferences to, scries p ro blein.s of mutual interest d linear* to have reached something of aV .P Alnr-k owing to the country repre%nStives backing into a blind alley ! s ~7, . -free Trade,” and objecting to ! any other path which might diverse opinions and unite s proSuc'crs of wealth. I It is obvious that in round-table ; ~,v. such as those between the repre- j ienritives of the Manufacturers' Association and the Farmers’ Union, ( meeting on common ground as em- . lovers of capital and labour, and the ,urce of tne nation’s wealth, that the i delegates should approach the subjects j discussed with as open a mind as possible setting aside any preconceived ideas and bias as far as possible, and being prepared to consider ancl weigh II tacts, evidence and arguments submitted from both sides. ANCIENT AUTHORITIES It is also obvious that a representative who comes to such a conference with his mind fully made up to stand t.v the late Adam Smith, and refuses to admit that any of the economic dictum* laid down 130 years ago may need modification in the light of industrial developments since, places himself out ,»f court by his blind adherence to a doctrine which time, facts and experience may have proved unsound. I)n p might as logically take one’s stand ufth our original Adam when he first delved, or the first Smith who manufactured a piece of raw' metal into a labour-saving device, and John Stuart Mill has no more claim to infallibility as an authority on modern economics than Karl Marx or Henry George. It is a mystery how men who are open to reason and conviction on almost overy other subject, will lock up some hoary political theory in a logic-tight . ompartment of their minds and refuse to accept the plainest facts and evidence in refutation of their notions. FACTS FOR FARMERS Some of our farming friends have made up their minds if an import duty is placed on an article the price ~f it must increase by the amount of duty. That is the dictum of Smith, Mill, Ricardo and other ancients; but it is proven beyond argument that the peculiarities of modern commerce are fuch that this theory is no longer universal or sound. Take the case of larming implements in which our rural producers are vitally concerned. It is well known that the greatest producer of these is an American firm which distributes them from Siberia to Patagonia. A widely-used machine on our farms is the seed and fertiliser drill. One of the best-known American makes, a 13-hoe (or coulter) one, is sold In New Zealand at £6O f.o.b. main ports, after it has paid 35 per cent. duty. The same American machine is sold in Australia for £6l 10s after paying a similar 35 per cent, duty; yet in South Africa, where it enters duty free, and the shipping distance is much less, the farmer there lias to pay £62 10s for the same machine. Adam Smith would say, “It can’t be done,’’ Ricardo would say, “It is absurd,’* Stuart Mill would say, “It is illogical”: but the Afrikander farmer knows that it is a hard fact. The reason for it is soon clear when we find that the Australian-made drill (of 14 hoes instead of 1$) is sold for £53 4s as against £6l 10s for the imported American implement, and New' Zealand makers produce one which is delivered, freight paid, to any port or station for £63, w'here the imported one is sold at £6O at the main ports. A nice equalising of prices by the foreign firm: but why should the South African farmer pay £2 10s more for it, when it should be 35 per cent less? HIGHER DUTIES AND LOWER PRICES So far New Zealand does not manufacture reapers and binders, although we have the materials and workers idle, but these machines are admitted duty free and the farmer pays America £72 for one. In Australia, after the American manufacturer has "done his duty” to the extent of a 45 per cent, tariff, the same machine is sold for £7O! Perhaps some antediluvian economist will explain why the New* Zealand farmer pays £2 more under Free Trade than the same machine is sold for in Australia after it has paid a high tariff of 45 per cent. Who pays the duty on it in Australia? The reason of this theory-bursting phenomenon is the fact that Australian workers make a machine locally for £7O 10s. TOP-DRESSING MACHINES As just one more instance, let our farmers study the peculiar vagaries in the price of top-dressers or lime-sow-ing machines. These are made by *' ew Zealand w orkers, and they were among the few lucky ones who gained increased protection when our 1927 tariff was framed. The duty was increased from 20 to 35 per cent. The result spelt increased production in our ''orks and a reduction in price of the ->ew Zealand-made machine by 15 per ! :Pnt - An Sft-w’ide machine, complete, lias been reduced from £4O 15s to £33 ®! nce the duty was raised. The •"rwWe American machine (not so solid or complete) sells here at the same price—£3s plus freight—as it did before the duty was raised from 20 per nt. to 35 per cent. Who pays the increased duty on these American toporemrs? And raising the tariff has - s . uc *‘d the locally made article by £ 7 inH°.V lUch for Ad am Smith, J. S. Mill in.. those w lio theorised on absolute *i"?- lonal ree trade and never foren' H , workings of a modern inter- I the farmers’ advoMindly refuse to admit these pn a?: Public cannot be expected to ! farmya '' d - P p.A < : y '' j PROTECTION now world WIDE .? he " ar ,he trend of fiscal definite? throughout the world has been in rh..!. y * anti increasingly protective counth lCt , er - Since the armistice 65 j In nil 1 .:! 3 ~v e increased their tariffs, j b t >~n \ Z ** 3 1 cases the increases have »lmo« orohib| b tive" tial, S ° m6 ° aSeS . general States has made two j force the n m re u Ses ’ and now has in | of that hl^hest tariff in the history creuve h-f° l l ntry ' * n Eur °P e the inUsh ® h s een general. Among Bri--outst»2wifltriesf ltries Aust ralia is the most ine it- ♦ ln^- exani Pi° of a country ruis- ; dom wh^ r i, ff #- rates ' The United King- | tem’hv I? 1 f °unded its industrial sys- j * the maintenance of the mo,st j befor« I i!’ 0t S ction for over 200 years bv the L adopted free trade, was forced bv i,JL • r to safeguard its industries I I tariffs on a long list of ®Ust* B havI l< K , ' ide i ncreaaing of tarlfts natio„!T been based on definite fl have’t. v necessities, or it would not ; Ivin- t^ en place - The reason under- ! I the J:. e Movement was a desire on reducX ♦uj . the various countries to i thev ij importation of goods which I | ud thf£. d Produce at home, to build cnee tindustries, to give preferDrorfim. their own farmers and other J heir .» u rs ’ to thmish employment for | *idditir»r> peo P ,e - to conserve their own , biatca. r ® v «nue to balance their esti-