Daily Circulation, 1500. The Oamaru Mail. TUESDAY, FEBRUARY 16, 1892.

Oamaru Mail, Volume XVII, Issue 5209, 16 February 1892, Page 2

Daily Circulation, 1500. The Oamaru Mail. TUESDAY, FEBRUARY 16, 1892.

The Opposition Press persist in reiterating the statement that capital is being driven out of the colony by the taxation system of the present Ministry. But not one of the newspapers that have taken up the cry his attempted by substantial facts to demonstrate the truth of the statement. Tho whole thing still remains in its postulatory stage, and it is full time that an attempt were n.ade to advance some evidence in its support. We confess that, prompted by a desire to arrive at the truth, even though it should be against our view of the matter, we have sought, but sought in vain, for evidence that would give warrant for the cry that capital is being driven out of the colony. All that we have been able to discover is that in some cases difficulty has been experienced in obtaining renewals of mortgages, and that is the utmost that has been advanced by the Opposition Press in support of a statement loosely made and as loosely oft-repeated with the object of injuring the present Government. But this one fact is by no means sufficient to sustain the sweeping assertion that capital is being withdrawn from the colony. It is but the very natural result of a want of confidence, due in part to a feeling of uncertainty as to the future values of landed property, consequent upon the loss of population, and clue to an even greater extent to the rude shocks that have been dealt to capital by the failure of a number of financial institutions in Australia. Every intelligent man is perfectly well aware that mortgagees have had anything but a pleasant experience during the past few years because of the serious drop in the values of properties, and, though they were themselves largely to blame for the losses they incurred as the result of basing loans upon inflated values, it is but natural that they should act with extreme caution in either renewing expiring mortgages or accepting new ones. But this indisposition to lend money does not establish as a proved fact the assumption that capital has taken fright and is quitting the colony. Capital as represented by money is still plentiful, as may be seen from the banking returns, 'which show that the banks in the colony have a million available for investment. What has diminished is capital as represented in land. This lost capital has not left the colony, for it is represented in land, and is, therefore, not removable. The loss is due to depreciation in the value of land, produced by two potent factors in combination —first, the loss of population, without which land has really no value as an exchangeable commodity; and, secondly, land, which was given a fictitious value in the years of inflated prosperity consequent upon a heavy expenditure, has undergone the very natural process of finding its level. The depreciation in the value of land has affected mortgagees to a very material extent, and thus it follows naturally enough that people with money are chary of lending it upon land until such time as values are firmly established, hence the difficulty that would-be borrowers experience in effecting loans. No matter what system of taxation were in existence the same result would have been produced by the same causes. It is, therefore, absurd to charge it against a system of taxation which has only just been adopted, and which has not yet come into operation. Nay, more: inasmuch as the causes became operative years ago and produced their natural result under a different Government and a different system of taxation, it is manifestly unjust to endeavor to fix the blame upon the present Government and their taxation scheme. Of course, it would have been possible to have lessened the depreciation of the value of land, for one of its causes—the loss of population —might have been averted by a wise administration of the Crown lands under laws that would have frustrated the knavish tricks of the monopolists and promoted bona fide settlement. Had the previous Government been animated by the single desire to promote the best interests of the whole colony, instead of those of the wealthy influential few, they could have prevented the great loss of wealth-producing population that went on for years, and which has only lately received a check under the wiser administration of the present Government. The settlement of people upon the land was the only means available to prevent the serious depreciation ;'i the value of landed property and the loss of confidence that followed the discontinuance of a heavy public works expenditure. But the Atkinson Ministry failed to adopt that means, and the colony is now paying the penalty of their neglect. True, they sold plenty of land and spent the proceeds ; but the land went to the monopolists and the people who should have been permanently settled upon it went to Australia. The present Government recognise that, as the settlement of the land was the preventive of the disease from which New Zealand is suffering, so it is the only cure ; and they have set themselves to work in good earnest to apply the remedy without any regard to the wry faces of those to whom it is unpalatable. Given fairplay they must succeed, for the energetic settlement of an industrious population upon the land will restore the value of land to a rational basis, and with that will come confidence completely restored and a plenitude of capital for investment in legitimate enterprises. All this will come to pass despite the cry of those traitors to the country who for selfish party purposes are endeavoring to damage the colony in the estimation of the outer world.