NEW ZEALAND'S Labor Government faces its third and severest test in the December elections. Labor was chosen in 1935, for the first time in the Dominion's history, largely as a result of the inability of the conservative Coalition Government to solve the problem of the depression. It has since been returned twice, though each time by a decreased majority. It continues to enjoy the almost unanimous support of New Zealand labor, but this year it is opposed by a strong combination calling itself the Nationalist Party -- a coalition of all conservative elements, including most of the primary producers and backed by practically the entire press.
The contest is sure to be close, with very small odds favoring the present régime. Labor has alienated many supporters by continuing the rigid import restrictions that for nearly ten years have kept Dominion markets short of many things New Zealanders once had in plenty, by an admitted inability to reduce taxes since the end of the war, by a refusal to terminate rationing of food and apparel, and by a recent realignment of electoral districts somewhat in the fashion known in America as gerrymandering. The opposition has made the most of all this, though the Government does not lack facts and figures in defense.
Conservative interests likewise bitterly opposed the recent taking over of the Bank of New Zealand, an institution almost as old as the country, whose shares the Government bought up at its own price. The Government denied that this was merely a Socialist gesture and a preliminary move toward the nationalization of large industry, and insisted that control of the principal banks was the basis of its highly successful housing scheme through which more than 20,000 new homes for low-income groups have been built in a decade, 14,000 of them during the war years, despite the dearth of materials and labor.
This is a point of general interest, since there is a possibility that the British Labor Government may proceed along similar lines.
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