The Taihape Daily Times AND WAIMARINO ADVOCATE SATURDAY, DECEMBER 8, 1917. NEW ZEALAND’S FINANCES.

Taihape Daily Times, 8 December 1917, Page 4

The Taihape Daily Times AND WAIMARINO ADVOCATE

SATURDAY, DECEMBER 8, 1917. NEW ZEALAND’S FINANCES.

(With which is incorporated The Taihape Post and Waimarino News),

The great war of the nations is responsible for the making of many records, not the least among them is that of the expenditure of money. The acquisition of the money needed has resulted in other records being established, the chief of them being reflected in unprecedented borrowing, ana in unprecedented taxation. Naturally, much concern is being felt in financial and commercial circles about the conditions that are to follow, and obtain generally when guns are silenced and swords sheathed. At the halfyearly meeting of shareholders in the Bank of New Zealand, the Chairman, as might be expected, voiced the financial present and future of this country from his Bank’s point of view. If the Bank’s view happens to be that which is generally believed as that likely to be realised by other commercial and financial institutions and people, then the Chairman’s words becomes of so much more importance to us in our efforts to delVe into the financial future. However Mr Beauchamp’s views may be regarded, it must be admitted there are few men indeed in this country so qualified by access to information, and by actual experience, to speak with greater authority, or with a nearer approach to absolute authenticity in discussing that great question on which, above all others after the war, rests the welfare and happiness of our people. After drawing attention to new methods of taxation in this country, the changes in its incidence, and its unprecedented comprehensiveness and magnitude, he essayed to help in forming an opinion of what the outcome of it all would be when peace came and a rehabilitation of normal life and production commenced_ He left no doubt at all about the fact that huge interests on borrowed money, pensions, allowances, asistance in reorganising industries for absorbing soldiers in civil pursuits, would cause taxation to increase, after the war, to a somewhat burdensome level. He is of opinion that despite taxation having grown to unweildy and staggering proportions, high prices for produce will continue, enabling us to bear

them, provided shipping difficulties do not intervene. He rather dwells upon the shipping aspect, remarking that six millions worth of produce'are already held up. The shipping difficulty, inwards and outwards, affects the trade figures to such a degree that they are not a correct indication of the Dominion’s trade position. We do not quite conform to Mr Beauchamp’s reasoning on taxation and interests, hut the difference largely arises in the understanding of terms. What he refers to as a platitude we regard as a mandate of morality and justice. We do not regard the “equality of sacrifice” postulate as an insipid, weak, empty statement, and we do not think for one moment that the producers and workers of this country will ever permit its meaning to be so expressed and observed. Banks in this Dominion have not up to the present increased rates of iterest on overdrafts or on bill discounting, and it would be interesting to know why private individuals and private lending institutions have substantially done so. If the Finance Act increased income tax to such an extent as to necessi-

tate or justify private lendgrs demanding increased interest on loans, surely the Bank was similarly affectit is paradoxical to suggest that the Banks’ taxable income is of a less taxable quality than that of private institutions, and the Chairman leaves no doubt in the mind of any of the

r>cixiK.'s customers in stating tliat a period of dearer money must be expected. What tbe producing, industrial and trading community have to face in the near future is easily discernible. There is to be an increase of interests charged on money for all purposes; taxation is to become much more burdensome, and prices of commodities are to recede to a greater or iesser degree. This is the view of the near future to be gathered from Mr Beauchamp’s remarks at Che halfyearly meeting of the Bank of New Zealand shareholders, held yesterday. Without entering into ..a discussion of the earnings of financial institutions as disclosed by their balance-sheets, we are inclined to place more faith in Sir Joseph Word’s publicly-uttered, unqualified statement that money will lemain cheap. We do not believe that any New Zealand Government, acting in opposition to money value as stated by the Minister of Finance the other- day, can retain its holds of the Treasury Benches. Industrial life may be able, with extreme difficulty, to weather the storm of depression chat will follow when war expenditure ceases under reasonably just financial conditions, but with increased interests and taxation and a decreased income resulting from -'lower prices the outlook is something one refrains from contemplating. It is time that the old process of squeezing from top to bottom became something for this age to be ashamed of. No matter what the profits of financial institutions are, if taxation is increased it is passed on to the customer, and the passing on process proceeds until it reaches the wage-earn-ing community. Then disorganisation and convulsions commence from a reversion of the squeezing process being put in motion. The wages men assail their employers and so on resultingin strikes and lock-outs. We have ample evidence of what is happening in other countries because men will pursue a course of greed. Governments are being wrecked and national institutions destroyed; traitors are selling their compatriots info slavery, all that the present insane opportunities for extortion in millionaire-mak-ing may continue. People of our own Empire are reading the signs of the times and almost incredible changes are being effected in Britain and other Dominions; will New Zealand be last of all to realise that the old lord and slave days are numbered? The old cycle of rising prices and wages is a disgrace to the men of any country in which no improvement is attempted, and if Mr Beauchamp had thrown a little light on the path in this direction it would have saved the speech under notice from following all previously delivered in a similar capacity into oblivion. So far as the speech delivered yesterdaygoes it is no less useful than others; in that it is confined to old ruts it is unsatisfactory and unsatisfying. It merely states a mass of financial figures, and suggests to the people what they may expect from dear money, increased taxation, following on a lowered income.