THE PRICE OF BUTTER.

Taranaki Daily News, 17 May 1921, Page 4

THE PRICE OF BUTTER.

The reply given by the Hon. W. Nosworthy last week to the deputation that waited upon him relative to protecting the interests of the workers, now that .the market price of butter has fallen, admits of no misconception. Having made a bargain with the butter .producers relative to the price this winter, the' Government will adhere thereto and make no change until the end of August, and then will come a free market. No other course is possible. The contract was made at a time when “there was not the slightest whisper of any collapse in the outside market.” The producers may congratulate themselves on having made a favorable bargain with both the Imperial and Dominion Governments. The Minister frankly expressed his dislike of subsidies, and in this respect he has many followers, though he was careful to lay the blame for their institution on the shoulders of the National Government. At any rate it is some consolation to know that, as far as the Minister knows, there will 'be no interference by the Government in the trend of prices after August 31, though it is possible wheat and flour may prove exceptions to the rule. It may therefore be expected that subsidies will soon be a thing of the past, and that prices will be governed by the world’s markets. That is as it should be. It was a mistake in the first place to grant subsidies. There really was no need for them; but they served as a sop to the Labor extremists, from whom trouble in the loading of the produce was expected. Subsidies are unsound in principle, and only lead to trouble and loss in the end. In the case of the butter producers, they would, if left alone, have got high prices for their summer make, but low prices for the winter output, and so the consumer would have been really better off, because he would have had cheap butter during the winter months, when it is more essential as an article

of food, and perhaps when work is less .plentiful. The Government made the initial mistake in interfering with the market rates in the first place, and now has to see the thing through. We hope to see the wheat subsidy also dropped after next season, and so allow the 'law of supply and demand to operate again and regulate prices.