DISTRIBUTION OF WEALTH

Waikato Times, Volume 127, Issue 21228, 26 September 1940, Page 9

DISTRIBUTION OF WEALTH

(To the Editor) Sir, —Mr Crabb seems to be able to more than hold his own against all as far as reason is concerned, but as the poet says. “All words are worse than useless; reason’s self ye would deride; ye are but the sons of folly, and the slaves of purseborn pride.” I might state that in my own view you can tinker with the present system as much as you please and until you adopt the cooperative or socialist system, so will slumps and depressions continue. How can it be otherwise? No man is going to start a business or a factory or a farm unless he sees more in it than is to be made by working for wages. The retailer runs his business and makes a profit. A grocer will average, say, about 30 per cent; a draper, say, about 70 per cent; a fruiterer, say, 100 per cent. All probably after paying expenses, wages and salaries, make about, say, 15 per cent on their turnover, if lucky. In this district the farmer gives back to his worker out of every pound he has produced, and mind you he has in most cases got the money in hand before he pays it out to the worker, from 3s 4d to 5s in the £1 if a wage worker, 6s 8d in the £1 if a sharemilker not owning his herd, and 10s in the £1 if the milker owns the herd. Now I would like to know on what line of economic philosophy you are going to teach that worker that he has a right to give, say, more than 15s to 16s 8d to the farmer out of every £1 he has produced, or what line of philosophy will make fthe farmer think he should accept less and give the worker more. He usually screams that the high rate of wages is crippling the farming industry.

In the 1940 issue of Whitaker’s Almanac, on page 898 are published the New South Wales industrial figures, the most comprehensive of all the Australasian States. The others, I presume, are like the dairy company chairman up north who recently stated that they would refuse to have their returns published as they might be used against them. The New South Wales figures for the factories show that in 9097 factories 224,861 people were employed in 1937-38. They produced an added value (over and above the cost of the raw materials and fuel, including motive power rented) of £85,168,133. Of this the workers received £42,200,875. This latter includes all salaries and wages, or less than 10s in the £. The value of machinery used was £57,222,693. The value of land, buildings and fixtures was £54,471,643, a total of £111,694,336. The depreciation of machinery at 15 per cent would amount to, say, £8,500,000. The increase in the value of land would more than make up for the depreciation in the values of buildings, but say the buildings are worth £30,000,000, a depreciation of 3 per cent would be £900,000; say a total of £9,500,000 of depreciation out of a total profit of, say, £43,000,000, leaving a net profit of over £33,000,000 on an investment of £112,000,000, or about 29£ per cent. I think the original capital of the Colonial Sugar Refining Company was about £400,000, and the last time I referred to it some years ago it was about £20,000,000, mostly made up from reserves. The Broken Hill Proprietary Iron Works recently added over £4,000,000 to its capital out of reserves or otherwise undivided profits and depreciation on plant. As the real producers or wage workers, whether they be primary producers, manufacturers or distributors, get only a small proportion of what they produce, and as they are the most numerous in the community and their wants are the greatest, they can only at most buy back the amount they receive with the result every few years there grows up a big accumulation of goods; so depressions are brought about. If the worker lives in a miserly fashion and hoards his money in the bank the depression will come all the sooner.—l am, etc., W. B. McMANUS, Matamata, September 25.