NATIONAL BALANCE-SHEET.

Taranaki Daily News, Volume LV, Issue 255, 18 March 1913, Page 4

NATIONAL BALANCE-SHEET.

Under tliis heading the Wellington Times deals in a very informative and able way with the question of ascertaining the country's position from its imports and exports. Mr. Mabin, president of the Wellington Chamber of Commerce, it will. be remembered, declared before the British Trade Commissioners that we are failing to pay our way by four millions a year. Cross-examined, he stuck to his position, and seeme.d, indeed, rather to enjoy the sensation he had created. But, later on, things transpired which led Mr. Mabin to "!'.e;ige," But the fact remains that he did declare that we were failing to> pay for tiie imports in what he considered the orthodox way. The Times takes the period of seven years tabulated by Mr. Harold Beauchamp (and published subsequently in the News) and proceeds to dissect the position. It writes: —The table, which is official, gives an export total in the seven years of one hundred and thirtythree millions, and shows an excess of exports over imports of roughly twenty millions. But Mr. Mabin's method of regarding the trade returns would give us four millions a year to the bad for this period, which in seven years is twenty-eight millions. The reality then is forty-eight millons better than Mr. Mabin's method would lead us to conclude. But this is by no means the full extent of the deviation from accuracy to which the president of the Chamber of I Commerce would bring us were we to 'follow his method. It has been pointed out that while the import values are exact, being derived from the invoices, the values of the exports are only estimates. ' Now. these are usually below the real value, in prosperous years at all events. Unless there is evidence of some very sudden unexpected fall of prices it is probably safe to estimate that 5 per cent, more is generally received for the exports than the aggregate of them in the annual returns. This on an aggregate of seven years of 133 millions "is £0.000.0(10. Then, as Mr. Mabin seems to have suspected after his fatal examination, there is a proportion of imports brought here on capital account. In a young and progressive country there is investment for the purpose of increasing productiveness. There are no records bearing directly on tin's important point. But there is much information in the" official statistics whch will support a fair estimate. During the seven years —IOOS-12 —of Mr. Beauchamp's < quoted table the Public Works Fund from all sources obtained for works £15.700.000, and the local bodies in the sixlast years of the period spent £5,700.000 of borrowed money. In the seven years the mortgages registered increased by £l2.ooo.ooo—in which, we presume, are included the £7.747,880 advanced by the Advances Office to the settlers. These, three sums together amount to £35.000,'000. roughly speaking. The question is what proportion of this aggregate represents material, machinery and goods imported. There is railway material, tramway material, fencing wire, roofing of iron and other materials,, timber, machinery for agriculture, mining, flax-dressing, timber work, gas-making plants, motor-cars for business and pleasure—not for extravagance, for the motor is by no means a sign exclusively of extravagance. These and innumerable other things would probably absorb a third of the borrowings and investments of the State, the local bodies and the community. That would represent some £11.000,000 among the imports for the seven years. Then there is a, certain proportion of the debt, general and local, which is held in the country, and does not require the sending of any sums away Home by way of export. The Post Office moneys alone represent half a million; and if we add a quarter of a million for the rest —not an extravagant estimate —we have threequarters of a million every year which the exports have not got to balance. In seven real's this is £5.2.">0.000. The true distance from accuracy in seven years is thus represented by a number of items, which wo will now add together: £ Krror as per table of trade balances -(s'.O-00.000 live per cent, realised on exports over the estimate ... (i.COO.OOfI Imports on capital account . . 11.000.000 For debt locally held ri.250.0U0 firand total 70.550.000 This is the result of fakinjr'up the favorite line of manv reformers of a few years back: of taking it up for -even years (concludes our Wellington contemporary). The chances are that taking it forward for another seven years I lie error would reach substantially over one hundred millions. . . . The error is the consequence of dwelling on the balance of trade exclusively and for short periods, which was once a habit with "Reformers" throughout the Dominion.