The Dominion. THURSDAY, AUGUST 21, 1911. BORROWING & IMMIGRATION.

Dominion, Volume 4, Issue 1214, 24 August 1911, Page 4

The Dominion. THURSDAY, AUGUST 21, 1911. BORROWING & IMMIGRATION.

In an interesting address delivered before the Dunedin Chamber of Commerce recently Mit. J. A. Johnston (Wright, Stephenson and Co.) made some interesting observationsupon the public debt of the Dominion and the policy of tho future. Mr. Johnston's analysis of the position may be open to criticism in several particulars, but his conclusions are well worth attention. The particular .points in his address on which we propose to make brief_comment are in connection with his references to borrowing for reproductive works and the necessity for an active immigration policy. Like a great many other people, Mr. Johnston regards with a good deal of satisfaction our interest-earning loans, or loans invested in reproductive works. No one, we think, will venture to deny' that a substantial portion of our loans arc reproductive, .and no one- will dispute that borrowing has been necessary for the opening up of the country and the development of our resources. People, however, begin to differ when the amount of the borrowing is taken into account, but more especially in respect of the spending of the borrowed money. Taking, for instance, the money borrowed and expended on railway construction, no one is likely to dispute that it was necessary to borrow for railway construction purposes; but a great many people will say, and correctly, that a substantial 'proportion of the money sii borrowed has been improperly spent or wasted. Keccntly we had an cVamplc of the waste that goes on in the construction of railways under the co-operative works system, when Me. Jokes, of the Farmers' Political Protection Federation, described his (experiences in travelling over the Seddox-Ward railway works in the Marlborqugh district. The public's money is being expended there on railway works which should ultimately prove reproductive, but large sums arc being wasted_ needlessly on the undertaking owing to the methods pursued in carrying out the. works. Then again we frequently hear the boast that the railways arc now interest-earning. This is not so*. During the long period of years that they nave been run at a loss the annual shortage has at compound interest mounted up into a very large sum. This sum has not been added to the capital cost of the railways, as it should .be, and in-terest-is only charged against the actual money originally to carry out tho railways and provide the rolling stock to work them. It is the custom to ignore these aspects of our so-called reproductive works, and wo merely recall them now with tho object of pointing out that the critics of borrowing in the main do not object to reasonable borrowing with careful expenditure: but make protest against excessive borrowing, accompanied with wasteful expenditure of the money bor-. rowed. That this wasteful expenditure has been going- on for many years past is known to everyone, and it is onlv the necessities of party politics that force the supporters of the Government to defend the position. The question of immigration in relation to borrowing has been almost entirely lost sight of in recent times. Twenty or thirty years ago immigration went hand in hand with borrowing. It was recognised then that it was of no use to spend money on railways and roads in opening up the country unless settlers were available to take up the land thus [thrown open to settlement. Every settler induced to come to New Zealand and tnike up land meant an increase in the production of wealth to go towards meeting tho interest charges on llio borrowed money. Every additional back that Hie. burden of debt was spread over assisted to lessen the load of the rest of the ('(immunity. Nowadays we make little or nn effort to increase the number of backs to bear the burden, but wq go on piling up tho hui-ilen at a faster rntc tlutii ever befon;. It

docs not improve the position very much to say that a large part of the money borrowed is rejjrociuclive or intcrest-eaininfj—the fact remains that the liability for the borrowed millions rests on the people of New Zealand, and the interest charges come out of the pockets of the people of New Zealand in one form or another. The more producers there arc tin; more widely tho burden is distributed and the more easily. it is borne. Mr. Johnston in his address' before the Dunedin Chamber of Commerce dwelt on the necessity for a vigorous immigration policy. His idea is that the country is hampered in the matter of turning its lands to the most profitable account by lack of population. Governments in the past, lie says, have been devoting too much time to tariffs to bolster up our manufactures, and too little *-o tho settlement of the land. What wo want arc farmers with moderate means and farm labourers, and we should aim to rob country life as far as possible of its discomforts and hardships in order to induce people to go on the land. These ideas of Mk. Johnston of course are not new, but they are wholly admirable. Like him, we should like to see the country settled by small farmers of every class. But where is the land to settle them on? Mr.'Johnston says, "Buy up tho large estates," which is a very natural thing for a resident of the South Island to suggest. But tho large estates are all producing something, whereas there aro millions of acres in the North Island-producing nothing and paying neither rates nor taxes. These arc the millions of acres of Native iands which the borrowed millions spent on railways and roads are incrcasing_ in value, every year, while thc_ Native owners drive around in their motor-cars or idle the time away living comfortably on the rents of such small portion of their lands as they have thought fit to lease to Europeans. These huge unproductive areas are the lands that the Government have locked up for so long, and by so doing checked the development of the country at that greater rate which could otherwise nave been attained. We should like to see Parliament give adequate attention to the question of immigration in relation to borrowing, always bearing in mind that it is of no use to bring into the country immigrants of a class likely to swell the population of the cities. And we should also like to see Parliament bestir itself_ in the matter of forcing on the opening up of Native lands as the soundest means of lightening the load of debt at present borne by the people of the Dominion.