Corporations

The South Seas and the Big Corporations

THE wise policy and sound trading disclosed in the annual balance sheet of Burns, Philp (South Seas) Co.

Ltd. give rise to certain reflections.

In these days of noisy demagogues, and at this critical point in the world’s economic history, it is the fashion to speak of big trading companies and corporations handling public utilities as monopolists, financial bloodsuckers and excrescences generally on the face of a defenceless social structure.

Therefore, it might be well to pause and ask what would have happened to society if the big corporations, in this time of crisis, had been conducted in the same way as the average “demo cratic” government. The answer is easily given. There would have been a complete economic collapse, with all the attendant horrors of revolution, famine and rapine.

Take, as an example, the position in the South Seas, where trade and finance move, to a great extent, along the channels provided by the Big Three (Messrs. Burns, Philp and Co.

Ltd., Messrs. W. R. Carpenter and Co.

Ltd., and Messrs. Morris, Hedstrom Ltd.). The three companies dominate the South and Central Pacific—what they say goes. Even the Administra tions wisely refrain from getting into grips with them. It is not surprising, therefore, that many people very bit terly attack their power and influence.

More than a cart load of bricks have been brought to this office with a plea that we throw them at “the monopol ists.” Some of the statements made to us indicate that, at times, the com panies’ branch managers are more than a little arrogant in dealing with clients and with Islands communities gener ally.

But we prefer to set against the smaller evils the very large amount of benefit which the Islands territories re ceive from their close association with these companies. There is not the slightest doubt that if the big com panies had not been conducted with great skill, wisdom and foresight, so that the world-wide economic crisis was long foreseen and specially pro vided for, the majority of traders and planters in the South Seas would to day have been wiped out. As it is, the big trading companies, being ready for this emergency, have brought into use their tremendous reserves of financial strength and have been able, not only to carry on themselves with out serious embarrassment, but also to give support to a very large number of individuals who otherwise, because of lost revenue and absence of reserves, would inevitably have been ruined.

It is not to be assumed that the Islands communities are escaping light ly. Practically everyone is suffering severely. There have been serious per sonal losses and some bankruptcies,

and spending power generally has been much reduced. But there has been no general collapse, and the position is neither desperate nor hopeless. Owing to the facilities provided by the big corporations, the economic framework remains efficient and unimpaired.

When normal conditions return — that is, when the world can re-commence buying foodstuffs and raw materials at the normal rate, and we believe that that return to normality is not very far away—the Pacific Territories will make a very rapid recovery. That would not have been possible if the Territories had not had during the economic storm, the protection provid ed by the well-established trading companies.