PUBLIC OPINION

Waikato Times, Volume 127, Issue 21177, 29 July 1940, Page 9

PUBLIC OPINION

As expressed by correspondents j whose letters are welcome, but for J whose views we have no respon- i sibility. Correspondents are re- j quested to write i:i ink. It is i essential that anonymous writers j enclose their proper names as a guarantee of good faith. Unless, j this rule is complied with, their i letters will not appear. i RESERVE BANK CREDIT ! | (To the Editor) ; Sir, —In my letter of July 22 there j is a serious omission which con- | founds the sense of the paragraph, j It may have been in the typing of t j the copy. My copy says I agree with ! ihe honorable gentleman when he : says building houses is justifiable, 1 but why stop at houses? Why not I schools, roads, wharves, in fact all | positively necessary public works? ; ! They are all assets, and are produc- ! tive. Dwelling houses are the only ones which are revenue-producing directly, therefore are best able to pay interest on their construction. The omission of the words, “dwelling houses” gives a very wrong impression.—l am, etc., E. M. MASTERS. Hamilton, July 27. STATE HOUSING . :aj j (To the Editor) Sir, —I am heartily with the State assisting all workers to build homes and to see to it that those workers, who of necessity have to be j transferred from place to place, are ! not left destitute of a home, but I can scent serious trouble where a government undertakes a wholesale housing scheme. Firstly, it comes into direct competition with the genuine homebuilder, which immediately causes an undue rise in materials and decline in building. Secondly, when a loss arises out of the Government undertaking the unfortunate taxpayer has to foot the bill, which will come under the present system as surely as night follows day. May I offer what I consider a suggestion to those genuine homebuilders. Give a subsidy of say 8 per cent up to and not over £IOOO, the homebuilder to find all above that j amount and. the subsidy to vanish l altogether after the £ISOO house. Always see that there is a sinking fund on all rented houses. The subsidy of 8 per cent to many who have houses may appear to be a severe tax on the taxpayer, but I think in the long view it will be less costly to the community than the present system. Now let us see what the 8 per cent subsidy would do. (1) It would encourage the permanent worker to have his own home, which is, I think, a great asset to the community. (2) It would keep several trades constantly employed. There are at least seven trades which would be put on a stable footing, all producing something, and “production is wealth.” Without production all the money or credit you can make is utterly useless. Motto, Produce or Starve. The imposition of further tax on building material would, in my opinion, stop the homebuilder and thereby put several trades out of employment. It is a great pity we in New Zealand could not do as is done in Alberta —abolish the sales tax altogether and give three per cent discount on all local production. Alberta is in the war.—l am, etc., E. M. MASTERS. Hamilton, July 27. PUBLIC CREDIT ARGUMENT (To the Editor) Sir, —Poor little “Spot Cash” seems to have touched off a powder magazine when he mentioned the matter of public credit and asked for information on the subject. Evidently the public creditors have very strong feeling on the subject. They have given a lot of information, and have created further confusion. For instance it has been said that State houses offer a very useful channel for the expenditure of public credit because they represent an “asset.” Are we to assume that we could cover New Zealand with houses, all built on public credit, and still be on a sound footing because of all the assets we have? By the same token, could not the Government provide us each with a RollsRoyce, all out of public credit? We would have the assets, and very desirable ones too. From some of the letters I gained the impression that public credit could be used only as far as it increased useful production. Mr T. E. McMillan has put a different complexion on the matter. He describes public credit as “site value,” or the value given to land by community effort. I like that part too and think it worth pursuing further. Why should speculators be allowed to benefit from the emhancement of values caused by something with which they have had nothing to do? This leads us almost back to the public ownership of land. Which reminds one that the State in New Zealand missed a wonderful opportunity in the early days. Had) it handled the land problem with care and vision there would, as Mr McMillan says, have been no need for today’s heavy taxation. But to get back to the other kinds of public credit. Do I understand that State houses may be built on public credit because they are an , asset in themselves or because they ; are an essential part of greater pro- j duction? And the same with fine j roads, railways and such things. Ac- 1 | cording to Mr Nash they may be 1 created from public credit if they ! bring with them the ability to pro- j duce goods, without which public ; credit is nought. But then, according to Mr War- • burton, public credit does not exist; [ private credit has been mistaken for : it. It is confusing, but we should j not be discouraged. One day someone ! will reduce public credit .to concrete j terms, and then there will be a rush ' for it, or away from it, according to j what is revealed. —I am, etc., SPOT CASH. Hamilton, July 26.