EDITORIAL COMMENT.

Progress, Volume III, Issue 9, 1 July 1908, Page 295

EDITORIAL COMMENT.

The Iron Industry. Elsewhere we prove that there is reason for supposing there are phenomenally large deposits of iron ore at Parapara. The reason lies in the fact that in one out of five blocks of country, all iron bearing, 22 millions of tons are in sight. With this wealth in view on the surface, the riches hidden below must be very great. The late Sir A. Cadman secured a lease with the late Mr. E. M. Smith at Parapara, and, after many attempts to float a company for working it (which necessitated repeated visits to Iyondon on their part) they died, as the project came apparently within reach of success. Work had been done on the property, according to the conditions of the lease, and after their deaths the project was underwritten on condition of substantial subscription within the Dominion. This condition was satisfied during the session of 1907, but for some reason the underwriting was not followed by the desired result. Had it been so followed, the underwriting syndicate would have made very large profits, and loaded the industry proportionally. It is a bad system for the industry, though good for the underwriting syndicates. In our opinion it would be better for the State to develope the industry. The State has accepted the responsibility of giving aid, for there are some attractive bonuses under offer with Parliamentary sanction. The State has also accepted the extension to the iron industry of the principle of State ownership already in force in the railways, the telegraphs, the insurance department — fire, life, and accident — and in coal mining. It has further done so by a provision, in the lease of the Parapara property, for the purchase by the Government, on certain specified

terms, at the end of ten years : a term extended substantially in 1906. This is eminently right, because the State can get the necessary money cheaper, and for longer terms, than any private firm, and does not have to pay profits to underwriters. Moreover the State, as the greatest user of iron in the Dominion, stands in the front rank of possible exploiters. State ownership and working would, therefore, be decidedly better for the industry, and for the interest of the public which owns the property ; and the State has the additional advantage of the indirect advantages. The State, moreover, has demonstrated its capacity for carrying on large businesses economically and safely. Lastly, in the event of more capital being required at any time — a thing very likely in the iron industry — the State will not have in getting it, the difficulty that blocks private enterprise. On the whole then, if the State were to determine to set aside half a million for the great work of establishing the pig-iron industry at Parapara, that would be the best way out. Time presses for decision. The American President has warned the world that its known resources are near their end, and the announcement has been made by cable that the biggest trust ever formed — " The International Steel Trust " — has been floated, with a capital of 150 millions sterling, to " corner " the whole. The Dominion must protect, by State working, the property that may make New Zealand the richest country on earth.