CURRENT TOPICS.

New Zealand Mail, Issue 1189, 14 December 1894, Page 31

CURRENT TOPICS.

POLITICS IN AUCKLAND. Mb Waed’s meeting 1 at Auckland appears to have been as great a success as the political part of the Premier’s demonstration at Rotorua. The Premier having traced the public works policy of the future, the Treasurer defended the new departure in policy inaugurated last session. His speech reminds the public of the struggle which that policy entailed in the House, justifies the principles and main objects of that policy, and is itself justified by the necessary meagreness of Parliamentary reporting. That the Treasurer who carried so much of that policy through the House should have declared his confident belief that the policy will not entail the addition of a shilling to the public interest charges of the Colony is not surprising. It would have been surprising if ho had said anything else. The key-note he struck when he said “ We cannot regulate prices, but we can develop products.” And when he went on to say that this is the time when vigour and determination and helpfulness are more than ever required from the Government, he said the right thing which justifies the policy all along the line. The reception Mr Ward mot with and the resolution passed by the meeting are very encouraging. The policy requires a fair trial from the country, and will get a fair trial. The country approves quite as much as the Auckland meeting of the objects of the policy. When the story of its working out comes to be told, the country will be able to judge whether its approval can be continued. The policy deserves success, and we shall' be disappointed if it does not command it. At any rate, Ministers are quite right to put its salient points clearly before the country.

RECESSIONAL SPEECHES. It is still the custom to treat' the recessional speech as a matter of importance to the community at large. But the truth is that except under very special circumstances their importance is confined to the individual members who make them. During the present recess there are no circumstances to make us suspend the usual rule. The political meetings therefore cannot be said to have any particular significance. If it were not so, then we should have some curious results. We should have to conclude from Mr O’Regan’s enthusiastic reception and sweeping vote of confidence that his constituency has taken up Single Tax, and that this is only the preliminary to the spread of that somewhat peculiar belief over the whole Colony. But the fact is well established that the Colony is not peopled by men of the simple faith that makes them blind to everything but the wishes of their hearts. Ergo Mr O’Regan’s success must be explained in another way. There is no reason to search long for that explanation. Mr O’Regan is popular in his constituency, and deserves to be so. He is a young man, of strong character, independent mind, industrious habits, with a strong sense of public honour and full of public spirit. As a matter of course, having shown these qualities during the session, he get 3 a vote of confidence during the recess.

Two other cases are those of x Mr Earnshaw and Mr Pinkerton. The junior member for Dunedin got a great reception certainly. Are we to conclude from that the Southern city has gone against the Government ? If we had come to that conclusion, as a good many of our c >ntemporaries did, we should have had to reverse it after reading of the triumph of Mr Pinkerton. If the junior member placed the “ writing on the wall ” the senior member must be held to have wiped it out. Then why did Mr Earnshaw get such a good reception ? For the simple reason that Mr Earnshaw is Mr Earnshaw. The Southern city knew him for a member of, in some respects, independent conduct. The history of the session of 1893, which was very fresh during the general election, records that Mr Earnshaw was at loggerheads with Ministers a good deal more in 1893 than he has since been in the session of 1891. His reception during the recess of 1894 is therefore no more signifi-

cant politically than his election during the recess of 1893. That Mr Earnshaw is a Liberal we admit cheerfully. That he is a capital representative nobody denies. That he has a grievance against the Government is a pity, and is duo to misunderstandings and mistakes, perhaps on; both sides. But that is certainly not enough to prevent him from getting a vote of confidence during the recess from the men who elected him before the session. There was enthusiasm at his meeting. But there was not more than the presence of personal sympathisers would account for. If there was any political significance in the proceedings, it will be found in Mr Earnshaw’s somewhat wild claim to be regarded as the best workman of his trade in Otago. It is a claim resented by his fel-low-workmen, whom he has thus quite unwittingly offended. If they do not forget it by the time of the next general election Mr Earnshaw’s chance of return will be seriously jeopardised. But that is a point hardly worth raising at present. Mr Pinkerton’s reception was as usual. The senior member was listened to with appreciation, and he got his vote of confidence. It is significant that he got that vote after a contest. The men who had applauded Mr Earnshaw’s condemnation of the borrowing policy moved to reject Mr Pinkerton’s defence. The defence was simple, clear, direct. It pointed out that the borrowing was necessary, different for the most part from the borrowings of the past, and for t|ie other part that it represents a minimum not a maximum, of pressure on the Treasury. The senior member, in fact, spoke to his constituents as he had spoken to the House on this subject many times. They had had it in the newspapers, they had seen it in Hansard, they heattf' it ,

from Mr Pinkerton direct. After hearing Mr Earnshaw and his friends, they approved of the senior member. That is significant to this extent: that Dunedin just about stands where it did before the Government unfolded and carriedits policy. It was thought in several quarters that the counter demonstration after Mr Earnshaw’s reception would have been Ministerial. But the Premier simply went to Dunedin to wash his hands in milk, leaving the city members to themselves in the political field. The sequel is that politically the Southern city is much where it was before the session. The truth is that it is too soon to go to public opinion about the policy of last session, which has not yet had time to bear fruit. The fruit of the policy will be ripe enough for the electors at the next election, and before that event we may have signs of their mind. But at present it is difficult to tell what they think, because they are not thinking at all. They are waiting.

THE PUBLIC WORKS OF THE FUTURE. There can be no more conflict as to the leadership in the matter of the future of the railway system, for the Premier has lost no time in occupying the position. What the House of Representatives wish they showed unmistakably when they threw out the Midland Railway Bill, as we showed on that occasion by careful analysis of the voting. The House left Canterbury practically high and dry, not because it was against the Midland, but because it wanted a forward policy, in which the Midland could be included. The vote which killed the Midland Company’s chance, for the time being, put the chance of the line on the best footing it has ever enjoyed since the commencement of its career in the region of political agitation. That vote meant the forward policy which embraces the completion of the Otago Central, Midland, North Island Trunk b'nes, and the purchase of the Manawatu Railway Company’s line. About the main scope, as thus stated, there could be no doubt. And if the country were polled to-morrow, it is beyond question that it would endorse such a policy. As to details, there was room for divergence. The question of details is in fact full of pitfalls for the unwary politician. How much of the North Island Trunk is to bo done ? Is the bulk of the money to be spent in making the' diversion to .Stratford ? Where is the Midland to stop, and where the Otago Central ? These questions have not deterred the Premier from taking hold of the railway question with a firm hand. Recognising that a programme has to be drawn ho has drawn it with the utmost clearness.

Taking* up the Northern diversion question ho has declared boldly for a coach road into tho Waitara Valley, and therefore against the Stratford diversion so dear to the Auckland politicians. Having determined that point he has fixed upon Hautapu as the point for the limit of Northern extension of the Southern section of the Northern Trunk. Thus he provides for maintaining the inland line against allcomers by the completion of a proportion suffi-

cient to justify the hope of a rapid return. To the purchase of the Manawatu Company’s lino he referred as a necessity against which it is hopeless to contend. When he spoke at this point of the benefits of the public works policy to individuals, he could not have referred to the necessity for depriving tlie Manawatu shareholders of any monopoly as a reason for buying their railway. The simple reason is that the Premier must know as well as everybody else that the shareholders have received, during their whole career, one solitary and petty dividend in return for the benefit they have conferred on the public interest. Of returns which are not profitable they have received many, at the head of which stands a plan of taxation which is as ferocious, barbarous, and unjust as anything over known in the worst days of the mediseval barons, who lived by marauding, plunder, and blackmail. We feel sure the Premier has not received justice at the hands of the reporters in this respect. Turning to the Midland, he marked the map with decisive thumbnail, so to speak, saying that Jackson’s (the point to which the Company has brought the line eastwards from Reef ton, about fiO miles) is the limit of further advance. On the line of the Otago Central he has drawn the line where the committee marked it. Of all of which the result is that the

Premier has struck out a line which may displease a section of the Auckland representatives, the larger section, and the three representatives of Nelson and Marlborough who opposed the Midland Railway

Bill, but which will consolidate the bulk of the men from Wellington to Taranaki, from Canterbury, from Otago, ancl from Westland. It is the line of greatest safety for the Government, because it isolates a minority too small to give power to the economists at any price who will hear of no forward movement whatever. Moreover, it is the happy medium line between these and the extremists who clamour for a loan of ten millions. They are as much out of the running, in the face of a policy such as this, as are the hidebound men who will have no work of any kind undertaken on any pretGnce. After all, the Premier has not taken the country altogether by surprise. Ilis views are set forth in the Public Works Statement of last session so far as the North Island Trunk and the Otago Central are concerned. In that document lie contended, not for completing those lines, but for bringing them to a paying point. lie has added the completion of the WoodvilleEketahuna section, the purchase of the Manawatu, and the completion of the Midland as fa. i- Jackson's. It is a good programme and a safe. The Manawatu purchase can be arranged on terms which will find the interest. The Midland ought to be arranged for with the Company, and a million will do the rest ; surely not a thing unexpected or out of proportion to our meaps. The only condemnation is from

those who advocated a policj of railway extension involving many millions, at least six, and perhaps more. It is amusing to find the rejection of such a course dsnounced as a policy of bribery and corruption. The policy is financially sound as well as politically safe. It will not alarm the public creditor, and it will satisfy every legitimate desire for progress. Not its least merit is that it has been clearly and openly stated. Mr Ward has not thrown any light on the financial details. But of them we shall no doubt hear more presently. AT HOME AND ABROAD. While everybody is crying out in distress against the depression, the tide of population keeps setting towards Western Australia. The only idea of self-reliance in the ordinary mind is the species of suicide involved in a trip to Coolgardie. The world keeps up the delusion, because there are many people interested in the new goldfield. Enormously rich it may be, but already it has been exploited by the broker and the speculating cheat; already the share market of London has been bled to the tune of three millions of money. Naturally a whole forest of pens is writing up Western Australia in every conceivable paper. The writers are struck dumb by the remarkable progress of the last year or two ; they are amazed at the vast heap of gold sent away during the past 12 months to the value of no' less than a million and a quarter sterling. They make light of the want of water, they consider the climate as more mild and genial by reason of the hot winds of the desert, they write of camels, men and Afghans with endless verbosity, they clap their hands because of a surplus of under .£20,000, and they boom up the coming loan of a milliou and a half as a masterstroke of statesmanlike policy. And all this because the wily, exploiters have managed to get three millions out of the market through the mines, and intend to get more. Such is the outlook abroad. At home we have something quite as good, and we are perverse enough to prefer the uncertainties of Coolgardie to looking for it, for no other

reason than that it is at our feet. The fact is borne in upon the world in a striking manner by the progress of the Waihi mine, whose shares on Saturday were rumoured to have reached eighty - four shillings. Unfortunately this is an Auckland venture, and Auckland ventures have, for reasons which need not be too minutely detailed, fallen into disrepute somewhat of late years. But the Auckland district is nevertheless sound and rich, offering a wide field for enterprise of the right kind. If the people would only go out into their own country instead of running away from it, more of these good things would be discovered. The same idea was emphasised by the story of the party of tributers of whose luck we told in these columns a few months ago. Twenty to thirty pounds a week per man, with work for many years to come, close to the town of Hokitika—

that was their story. Kumara, whose most enterprising citizen is now in the Premier’s seat, told the same story very little more than ten years ago. A wanderer in the bush found a rich patch of gold, where no one had ever dreamt of looking for it. Rush after rush had passed over the spot, the palmy days of the West Coast departed, men were talking of depression and the approach of the extinction of mining, when suddenly this individual finds a patch, presently a township arises, and hundreds of claims are taken up around. Water is brought in and gold is sent out, and there is a flourishing population. Rimu told the same tale a few years later. So did Havelock the other day. So will many places if only men will condescend to drop their eyes from foreign contemplation to the ground beneath their feet. Such is the outlook at home.

When telling the story of the Hokitika tributers, we ventured to point the moral by suggesting that the unemployed might be forwarded to the goldfields, provided with tools, instructed in the simpler woi’k of mining—that form of it which consists in scratching on the surface—and left to pushing the country ahead and make a good living for themselves. There is not the ' slightest doubt that had this been done the men would have lived, that many would have made good wages, that some would have made fortunes, and that all would have benefited. Every West Coaster will tell you that the beaches will give “ tucker ” to as many men as you like to plank down on them. This plan of sending out the unemployed to the goldfields was being tried in Australia, as we pointed out when we made the suggestion, and we can now add that it has been eminently successful. The unemployed are still pressing, with diminished force, it is true ; but the diminution being due to the summer wants of the labour market is probably not altogether permanent. Why not try the goldfields ? There is one great argument in favour of the plan. It is that gold is the one commodity in the world which is not depreciating in value. No country can, it will be said with justice, afford to neglect its ordinary channels of production. To that the reply is obvious that this country is by no means neglecting them. The proof is the very pronounced criticism devoted to the whole line of the Government policy. We have al ways maintaine I that the Government has, speaking generally of the objects of its policy, not done too much for the encouragement of, the ordinary channels of production. But as the prices of produce are low all round, we are justified in recommending a trial of the system of encouraging an industry whose product steadily maintains its value. It does more, for the appreciation of gold is the reason for the depreciation of all other commodities. The unemployed are splendid material. Some of that material can with great advantage be directed to the produc-

tion of gold. We trust the Government will be equal to the occasion.

A STRONG RESOLUTION. Bank surprises have been the order of the day for some time. The surprise which we chronicle to-day is a surprise only because people have been led to believe what they ought not to have believed. The fifth section of the Bank of New Zealand Share Guarantee Act of last session is very explicit. It provides that "it shall be incumbent upon the directors if the Colonial Treasurer shall in writing require them to do so, and they are hereby empowered, to call up onethird of the sum of ten pounds per share for which the shareholders are liable under the aforesaid section twenty-one, within twelve months from the date of such requirement.” The section referred to deals with the liability of the ordinary shares. When the Bank Bill was introduced it contained provision for this call of onethird of the reserve liability, but the provision was altered as above, before the Bill became law. Since then the President and the auditor of the Bank went carefully into the accounts and notified the Colonial Treasurer that in the interest of the Bank the making of the call is necessary. The Treasurer thereupon notified the directors in terms of the fifth section above quoted, and the directors, who had made themselves conversant with the state of affairs, acquiesced. The result is the circular to the shareholders making the call of one-third, viz., ,£3 6s 8d per share. The Act permits them to spread the collection over a period of twelve months, and they have availed themselves of the permission. We regret the necessity, but we cannot doubt the necessity. The continuance of the low prices of produce makes it necessary that the resources of the Bank ? should be strengthened. The recognition of the fact justifies the > appointments of the President and the auditor. Bankers of experience and ability and upright character, they have come to the conclusion that the bull must be taken by the* horns. The Colonial Treasurer had, of course, no course open to him but to act on their re-

commendation. The directors are men of the highest business attainments. In acquiescing in the course determined upon, they have done a thing unprecedented in banking history. They occupy a unique position among bank directors, inasmuch as not one of them is indebted to the Bank to the extent of a single shilling. It was said of them when they were appointed that the reputation of Wellington for business integrity was committed to their hands, and that they were worthy of the trust reposed in them. Their action justifies the expectations formed of them. Moreover, at the last meeting of the shareholders in London, the retiring board of directors intimated that provision would in all probability have to be made for certain contingencies. What that meant ought to have been plain to the shareholders. They were most unwisely encouraged, by irresponsible writers, to believe that the Colony was going to clear them of all liability, for all time. They were, in fact, encouraged to believe that the business of the Bank would be allowed to drift, under cover of the usual euphemisms, to destruction, the Colony being ready to mop up the deluge. We trust that very few of them were led away by this inventive claptrap. There were a few no doubt who struggled to get rid of their shares. In that connection a duty was imposed upon the directors by the fourth section of the Guarantee Act of preventing transfers to dummies. But whatever danger there might have been on that score is removed completely by the course adopted. The management of the Bank having done the

straight thing, and the bold thing, and the openly honest thing, comes out with clean hands and a fine record. The only complaint can be on the part of those who have recently bought shares for a rise, encouraged by the writing of the political partisans who predicted that the Government would take all responsibilities. Their grievance is against the publicity mentioned aforesaid. To all sensible men who form their own judgments the position has been for some time very clear. We repeat we regret exceedingly the necessity for the course adopted. But at the same time we are constrained to accept that necessity. The evidence is overwhelming on that point, from the hint given by the old directors to the categorical reports of the officers and the acquiescence of the directors. The shareholders can have every confidence in the management, which by adopting a drastic policy has sternly put an end to the drifting which is the bane of banking in these days, thus retaining the leading position the Bank has so long held.

LURID CRITICISM. Thebe is an article in the last number of the Investors’ Review so lurid as to be amusing’. We recommend it to the notice of all our local pessimists, for it will show them ’that degraded as they are in evil imaginings they have much yet to learn in the business of pessimism. The Investor, however, enjoys over therq, the advantage of living out of the country he condemns with such unequivocal lugubriousness. No New Zealander could possibly believe that the whole agricultural interest is so rotten that it has grasped at the cheap money scheme in the hope that it will “ allow the comedy of solvency to be kept up for a few years longer.” “ The comedy of solvency ” is good. We have heard nothing precisely equal to it before, though we are familiar with approaches more or less distant. For instance, we all know the critics who condemn the encouragement of agriculture which the Government has devised, on the ground that at present prices the more we produce the worse off we must be. That comes by implication somewhat near to an agreement with the theory that the comedy of solvency is nearly played out. We like to gloat over the comedy of solvency as we think off the men who have been busy at the agricultural shows of the last two months. The comedy of solvency will amuse them highly. Are they really all bankrupt ? If they are, then if their numbers were to be increased to ten millions, what a fearful scene of financial desola-' tion this well - cultivated country would be. We have all heard of a land flowing with milk and honey, but of a land flowing with milk and honey and bankruptcy we cannot conceive until we realise the great comedy of solvency. The most delicious thing about the Investor is the consistency of his faith. Having described how the people are all helplessly insolvent, he stands amazed at the idea of anyone belieying that the credit of the Colony can be pledged for a single shilling over the forty millions (more or less) at present owing. And still our stocks keep up at the top of the market. “How they create surpluses in New Zealand” is the title of the Investor’s article. In elaborating this subject he has made the discovery that we borrow ip aid of sinking fund, and he makes it one of Mr Ward’s most grievous sins. But this policy dates back, he will be surprised to learn, ten years. It is a little late in the day to attack Mr Ward about it, especially as the assailant points out that Mr Ward reduces the aid in question this year from <£284,000 to £117,000. He might at least have seen some virtue in the reduction. He sees on the contrary vice, because he is pleased to imagine that the sinking funds are taken in aid of revenue ; the fact, of course, being that they are used as on capital account, in the same manner as loan expenditure. But this is only part of a perfect maze of confusion in the Investor’s mind, for his analysis of the public expenditure treats the Cheviot purchase as an ordinary item to be met in the ordinary way out of revenue, and his review of the income denies that pastoral rents and interest for lands are revenue in the ordinary sense of the word. His whole process of constructing a balance-sheet, is , unique. It mixes up the public works fund'with the ordinary revenue, it cuts out substantial items of revenue, it treats items of expenditure made on capital account as the ordinary expenditure of the year. As a method for making perpetual deficits, it is sublime and should be patented, but it is not reliable and not correct. Fortunately, it is the only way to prove the pessimistic doctrine that the comedy of solvency is played out, that there can never be a surplus, that “if the age of miracles returns New Zealand may be saved.” By figures, it is said, you can prove anything. By figures the Investor proves that instead of “a surplus we have universal bankruptcy. He also proves that the financial method is not always to be depended upon. * But he writes very good nervous English, and makes his points with great skill and confidence. He is, in fact, a humorist of the first water.