MANUFACTURING A "BOOM."

Dominion, Volume 1, Issue 238, 1 July 1908, Page 6

MANUFACTURING A "BOOM."

The letter from Mr, John Duthie on land values, which we printed yesterday, deserves the attention of every member of Parliament—and wo are optimistic enough to believe that there are many such—who is capable of taking a broad view of tho country's interests. Thcro has gradually grown up in our political life a tendency to consider legislative proposals as final, sclf-containcd, and independent proposals of change. Most of our' politicians—tho majority ' that has passed the .legislation of tho past fifteen years—lack •. the . inclination or the ability to apply > any really scicntific method to their consideration of proposed laws. An oxcellcnt example of this unscientific and unstatcsmanlike attitude is furnished by the (Socialistic legislation of tho past dozen years. Every new restriction of individual enterprise or abolition of individual liberty lias been discussed by', morabors as if it were the only proposal of the kind-that had ever come beforo Parliament. Tho result is. that a largo edifice :is .erected without the masons—who have forgotten, in. laying each stone,, that they have laid many already—being'';- 1 aware of it. ,It was a much simpler example of tho'joint effect of apparently unrelated laws that Mr. Ddtiiie.discussed, and one thkt will bo easily understood by the people who are paying such high rents just now. He applied the synthetic method to his enquiry, and, by surveying severaj fields of State activity and Government adiniriistration, ho demonstrated tho existence of several streams of tendency . all setting towards one common end—the inflation of land values.

' According to official statistics, tho upimproved value of, lapd increased by £73,850,224, or almost ICO por-cent., during tho period between the years 1891 ,and 1907. .First amongst the causes-noted by Mr. Duthie as operating upon, the' price of land was tho obstruction tha,t the Government has placed in tho way of the opening up of the. extensive areas of Native land. By keeping these lands off the market, the Government has been enabled to forijc up prices. For years the Assets Realisation, Eoa.kl was tho subject of censure'on the score of its slow and deliberate processes. ■ But the anxiety of the late Mil. Seddon to raise increased 'revenue from tho land, was satisfied still more fully by tho operation of tho Lands for Settlement Acts. -In most of the cases in which tho prico of the estate acquired for settlement purposes ay as fixed by the Court, tho Government did not pay an excessive price; but it is notorious that the acquisition of every estate has increased. : land ; values throughout tho whole of the district in which , the estate has been situated. In precisely tho samo way* the purchase of suburban land as sites for. workers' dwellings has stamped an undue valuo on all the land in the neighbourhood. We ; had an excellent examplp of this quite recently, in tlic purchaso of tho Nai Nai'swamp at a figuro far in advance of its value. The provision of capital for loans on land at low rates has also played its part in the building'up of tho boom. jln short, as Mr. Duthie points out, " by so restricting tho supply of land, by so {buying and assisting buyers, it was impossible that any result could follow, but that all land should advance to prices far beyond .'its productive and legitimate value."

That the creation of a land boom has not been the main object of the Seddon and Ward administrations may be concoded, but the actions of Mr. Seddon and his successor, have 6hown pretty clearly that, as Colonial Treasurer, each of them regarded this result of his proposals as a very agreeablo aid 'to revenue. Mn. Seddon made no secret: of his desiro for an advanco in land values, as our correspondent shows by his recalling of the late Prime Minister's exhortations to the valuers: to raise their yaluations. Tho present Government has,been less candid, but it has not.less surely taken steps to ensure; a- continuance of inflated land values. Prior to last (year, there' was open to the Government "tho fair and equitable weapon of A Compensation Court as a ' means of securing that the correct price should be paid for an estate ■ acquired under the Lands .for Settlement Acts. Last year fihe Government inserted a provision in tho Land Act which amounted to an incitement to landowners to set a high value upon their land, lly tho ingenious.device of abolishing tho fair methods of the older systpm of arbitration, and substituting a power to take land at tho ownor'B valuation, tho Government has secured that in Bolf-defcnco

landowners everywhere must raise the valuations of their holdings. The general rekilt of all this legislation has been the creation of a land " boom," from which an extravagant-Government in urgent need of revenue obtains what it desires, at the cost of a crushing scale of rents. The people who are suffering under the burden of high rents in "Wellington have only the Government to thank for their troubles. To many of our politicians, who never think below the surface, Mr. Duthie's investigation of the land boom will furnish useful food for thought. Wo could wish that it would set them applying their wits to a closer analysis of the tendency- of tho legislative nroposals of the future.