The Sun 42 WYNDHAM STREET. AUCKLAND FRIDAY, AUGUST 29, 1930 A DOCTOR OF FINANCE

Sun (Auckland), Volume IV, Issue 1063, 29 August 1930, Page 8

The Sun 42 WYNDHAM STREET. AUCKLAND FRIDAY, AUGUST 29, 1930 A DOCTOR OF FINANCE

A S.K Iv man may .not get well unless and until he consults a physician in whom he has some confidence and obtains encoui aging advice and a prescription. In such a case sometimes the medicine really does not matter much in the process of remedy. It may be nothing more than baking soda in coloured water with a drop or two of a soothing drug. The thing that counts, the real cure, is the tfinely medical authority and the confidence it inspires. As with indisposed individuals so with troubled nations. A country that is financially sick needs expert advice. Hence the suggestion by representative business men that tlie Government should invite Sir Otto Niemeyer, a Bank of England doctor of finance (the title fits him) to come over here and diagnose the Dominions financial sickness. A great deal could be said in favour of the representation that is to # be made to the State Administration, but before anything definite is done it ought to u made clear that New Zealand, with all its economic ills, is far from being in Australia’s desperate plight. The Dominion JS not yet altogether “off the Budget equilibrium, off the Exchange equilibrium, and showing serious manifestations of financial malaise. Still, its condition is bad enough to warrant a thorough expert examination and remedial advice. If the patient be free of organic disease he is at least run down and in need of a strong dose of economy and a long rest from extravagant living. Of course, it really is not necessary to incur the cost of bringing Sir Otto Niemeyer to this country in order to provide in less drastic dosage his prescription for Australia. Ilis advice and desperate remedies for a more desperate disease than that from ■which New Zealand suffers have been given wide publicity and made free to all other politicians and peoples requiring somewhat similar guidance and treatment. If there be wisdom in this Dominion its administrators, legislators and the deluded public generally will regard Australia’s extreme as a warning rather than as an example, and resolutely adopt remedies for lesser ills.

More than anything else Parliament as a whole is in dire need of Sir Otto Nienteyer’s attention. For years it has ignored simple economic truths which no Legislature can afford to ignore. It has allowed State expenditure to expand beyond the limits of normal revenue. It lias authorised a welter of borrowing without making certain that the money would be spent wisely and well on reproductive works and enterprises. Tt has increased taxation to an extent that cannot fail to depress industry and cause serious unemployment. In addition, and worst of'all its follies, the Legislature has maintained the stupid idea that the only way to relieve the community of one chafing burden is to put on another. Thus, today, the Dominion staggers under a colossal load- of indebtedness—over £263,000,000, involving an annual interest charge of more than £11,000.000 —taxation (£20,000,000 a year) and a record expenditure on State administration and public service. Indeed, if the results were not so lamentable and almost tragic, it could be said quite fairly that Parliament, as constituted and led, is comically inadequate to the country’s pressing needs.

If Sir Otto Niemeyer’s shrewd services were requisitioned would the Government and Parliament, would all the people, be prepared to accept his advice? He well might say, as he politely made it clear in Australia, that no country can go on erecting a huge fabric of debt and taxation and also support an exceptionally high standard of living without an equally high level of productive efficiency. And may not, we imagine that the observant hanker, who does not deal in imagination, would say plainly that an expenditure of close on £19,000,000 a year in wages for 85,000 State and local government servants is a preposterous outlay for a meagre population of 1,500,000? Whether Sir Otto Niemeyer comes to New Zealand or sails away from the country he has brought to its senses, the vivid duty of the Dominion’s most responsible men is to accept the warning in his lesson to Australia and avoid a complete breakdown in financial health. The cost of Government, the cost of production, and the cost of living must be reduced.