The Wanganui Chronicle, AND PATEA-RANGITIKEI ADVERTISER. "NULLA DIES SINE LINEA." SATURDAY, MAY 30, 1891.

Wanganui Chronicle, Volume XXXIII, Issue 11281, 30 May 1891, Page 2

The Wanganui Chronicle, AND PATEA-RANGITIKEI ADVERTISER. "NULLA DIES SINE LINEA." SATU RD AY, MAY 30, 1891.

.An interesting article on "Overmortgaging the land," appears in the Nineteenth Century for March last. The writer is of opinion that overmortgaging is in a • great measure responsible for the Irish land difficulties, as well as for the agricultural depression in other countries. He deals with the question chiefly as it affects tenant fai'mers ; but although the conditions of agricultural life in New Zealand are, in many respects, very different from those in Great Britain, his arguments are to a certain extent applicable to both countries. After going into figures, showing that the. present debt of land in the United Kingdom involves the payment of at least £50,000,000 sterling a year, and that in the event of a bad harvest there is little or no maigin left from the returns of the land for repairs "and necessary expenses, he says : " My>wish is not to arrive at the actual payments made, but to show that if land was not heavily mortgaged there would always be a substantial portion of the income from land available for repairs and improvements ; that the owner of the land would be solvent, and the State would be able to fall back on him in emergency ; that instead of the mortgagee, as at present, dictating terms to the mortgagor, the landowner would be master of the situation, and the agricultural mortgagee an unimportant investor, "who would never get more than the normal rate of interest for his money. There is no doubt also that land would produce more in the hands of affluent instead of poverty-stricken owners, oppressed with debt and weighed down by a sense of their own impecuniosity. These are a few of the reasons I would give in favour of legislation against overmortgaging. It appears to me to be the only means of correcting a very unhealthy existing state of things, and it would be a most welcome change to everyone if it could be the means of submerging for ever the i cry of agricultural ruin." There can be little doubt that land in New Zealand is seriously over-mortgaged, . and that any feasible plan that might be devised for checking the i evil would be of immense service both to farmers and to the community at large. It may be objected that the limitation of mortgaging would be a hindrance to the development of the country, especially in districts where the land is held by small settlers who have not themselves the means to make any extensive improvements; but as 1 a matter of fact it generally turns out that a man who mortgages his land to its full yalue is more hampered by the paymeuib of .the interest than he is helped by the u#e t of the priii-

cipal. A practical illustration of the benefits derived from the re- cstrictionof mortgaging is afforded by th& country north, of Auckland — £ generally considered one of tho most- r backtf&rd parts of the colony, as it i certainly is one which in many re- *■ Bpecfcs, owing to the difficulty of constructing roads and the poverty ,pf ' the soil,' suffers under the greatest { natural disadvantages. But this ( very poverty of the soil has been the salvation of the settlers ; for it is so poor that it is difficult, and in many cases impossible, to borrow money on it. And yet, go where you will in the North, even in the most unpromising districts, you will find the general body of settlers making a fair living out of their land, earning enough to pay .their debts, and feed and clothe their families, and to go on year by year adding small improvements to their farms; you will find progress, slow it may be, but all the surer for . being slow ; while those who haye. failed have almost always done so ' for lack of those qualities which are- essential to the success of a settleranywhere. While there is no district in the colony which makes a poorer show to the superficial observer, there- is^ also none which is really in a^mbrc thoroughly sound condition — in which there is so little wealth, and so little poverty ; in which a man who is willing to work has a better chance of making an honest- living, or a worse one of making a fortune. And what the limitation of mortgaging brought about by force of circumstances has done for 1 the. North, in spite of all its natural drawbacks, the same limitation, brought about by legislative enactment; might do for the rest of New Zealand. If land could not be mortgaged for more than one-third or one-fourth of its value, the security would be so much better that farmers would be able to obtain what money they did borrow at considerably lower rates; while, on the other hand, the mortgagee, if he never got more than- the normal rate of interest, would not be so liable as he' is at present to get less ; and thus the laud of the colony would be relieved to a great extent of a heavy burden which it can ill afford to bear, while the mortgagees themselves would in the long run be the gainers by the change. Another possible objection, that limiting land mortgage is an interference with the rights of property, is thus met by Lord Vernon : • " The State has power to tax its land and all the improvements thereon; and has consequently the prior claim to the land, inasmuch as the payment of taxation takes precedence of all other debts. Surely, therefore, while respecting the claims of these who, by the industry of. themselves or their ancestors, have acquired the right to call a portion of the land their own, and have enhanced its value by creating the existing state of things, we may, without infringing on those rights, limit the debt they incur on the security of such property, so as to ensure a margin for necessaiy repairs or reduction of rent, and to prevent a decrease in the capital -value of the land." To this it maybe added that there would be no real interference at all. What is suggested is that the State should abstain from interfering in certain' cases. It is not meant that excessive mortgages should be absolutely prohibited, but simply that the State should refuse to recognise or enforce them. There is no natural obligation on the State to enforce all contracts.not absolutely unlawful, and there are already' many cases in which the law will not interfere to enforce', agreements between man and man, and if it is shown that contracts of a certain class are oppressive or contrary to the pubiic interest, there is clearly no injustice in refusing to them the . countenance of the State." Lord Vernon's proposal is a practical one, free from the extravagance and injustice which characterise too many of the popular political fads of the day, and deserves the attention of all who take an interest in social questions whether in Great Britain, or the colonies.