/IF V \ rsl % TRADE DEPRESSION AND WASTED RESOURCES Witli some remarks on Popular Government in New South Wales. BY C. M. SMITH. iSgtoneg: TURNER & HENDERSON, HUNTER STREET. 1887. c hw»Slb PREFACE. My Publishers tell me that disappointment is the abiding lot of anyone • who tries to write a book here, whether large or small. Within these covers I have, however, tried to ,say r according to my lights, some things which seemed to me worth saying, and I leave them to their fate. C. M. SMITH. Hardie’s Buildings, Hunter Street, Sydney. TRADE DEPRESSION AND WASTED RESOURCES. With some Remarks on Popular Government in New South Wales. Suddenly arriving in New South Wales—if I may he permitted the supposition—from some distant planet, I hear on every side of bad times, trade depression, closed factories, the unemployed, ad valorem duties, increased taxes, and the like. I bethink me that this poor, unfortunate, overcrowded people must be surrounded by quarrelsome neigh¬ bours. Doubtless, all that they can contrive to wring from an exhausted soil is given up to the maintenance of great battalions—one to watch their frontier on the north ; and another to guard their fords on the Murray from the fierce tribes of the south. The pirate rovers of Zealandia and Tasmania hover about their ports, robbing harassing and destroying their merchantmen ; hence the necessity of a vigilant, although rather expensive navy. And when these millions of fertile acres were surrendered to them by the great mother of nations, I expect to find that she placed them under the yoke of an exacting ransom, which weighs upon and crushes them. But I inquire, and, great Heaven ! what do I Trade Depression and Wasted Resources. find ? The whole acreage of a noble territory placed, without money or price, in the sole and undisputed control of this million of people; nobody who can he conveniently quarrelled with nearer to them than the howling deserts of mid-Africa; and the nett result, nothing better than a continually accumu¬ lating load of public and private debt, with the consciousness in men’s minds that they are stead¬ fastly drifting from bad to worse, and that such a conclusion has to be accepted with the dismal resig¬ nation of the fatalist, instead of being struggled against in a manful and resolute spirit. If you believe that, by some inscrutable decree of Providence, it is a settled thing that these afflic¬ tions have to be suffered, by all means let them be accepted in a spirit of humble reverence. But I am about to ask a hearing for the contention that they are the work of our own hands, and that, but for the huge and unnecessary waste continually going on in the diversion of the means and resources of the country into unreproductive channels, there would be work, bread, and house-room in it for every person deserving of these blessings, A country may be governed from the point of view of the economist, or from that of the senti¬ mentalist. In submitting my allegiance to the first of these alternative methods, I of course at once acknowledge myself to be a poor-spirited kind of creature, scarcely fit to sit at meat with our men of Trade Depression and Wasted Resources. 5 war. The economist does not seek to pose in stage .attitudes before an admiring universe, as the saviour of empires. Comfortable homesteads and well-tilled fields—the restoration of the breath of life to perish¬ ing industries—the means of living for every willing worker—peace, contentment, and prosperity within our own borders,—these are the triumphs which he looks for, and the ambitions to which he limits him¬ self. But they are bright dreams which can only be converted into realities at the expense of a much more active and intelligent interest being taken in public life, on the part of the more capable and self- respecting section of our fellow-citizens. Pointing towards Macquarie-street, and thanking God they are not as these others, will no longer fulfil the measure of their obligations to that community in which so many of them have prospered. I do not know that under any system which has prevailed since the world began, or which, indeed, will ever prevail in it, there can be at all times so well graduated a relationship between demand and supply as that intervals of industrial depression will not succeed to those of great activity. But surely, in a country like this, oppressed by no evil inheritance from the past in the shape of war-created debt; with millions of fertile acres in it as yet untouched by spade or plough ; with rich and accessible coal-beds under her surface ; with her wool, her vines, her gold, silver, tin, and copper ; in a land, in short, over- 6 Trade Depression and Wasted Resources. flowing with rare and diversified natural gifts ; it would seem that one might almost be justified in looking for a more even, steadfast, and uninterrupted flow of prosperity than in any country under the sun. It becomes us to ask why then is the reality so different from the reasonable anticipation ? It is because the expenditure of the Government which you, the people, have set over yourselves, is largely applied to objects purely wasteful and extravagant, having no relation to the comforts, the necessities, or the well-being of the governed. Because the taxation necessarily following that extravagance is wantonly applied in such manner as to injuriously affect both trade and industry. And because both the amount and the nature of the taxation threatened in the immediate future are such as may be calculated to- paralyse at the fountain head every possibility of a healthy reaction, and to dissociate capital in the first instance from its alliance with industrial enterprise,, and, if successfully persisted in, to drive it from the country. It is not my intention to write an essay on Free Trade. At the same time, no paper set forth under the present heading could properly omit a passing reference to the wasted resources involved in that arbitrary and reactionary interference with the free use of our faculties, our possessions, and our oppor¬ tunities, which poses itself under the name of Trade Depression and Wasted Resources. 7 protection to native industry. I took an active part in the advocacy of Free Trade principles in this community more than twenty years ago, and I well rememember that one of the things then alleged against us was that we had nothing new to say about it. There was, I think, some justice in this. Possibly some of us may have waited for the old arguments to be answered before starting new ones. For my own part, it is a difficulty which I feel still clinging to me, and it is one which would equally beset me if called upon to find some fresh language for the demonstration that the sum of the angles of any triangle equalled two right angles. The first demon¬ strator of that problem was happy in dwelling among a people apparently ready to concede his fundamental postulates. But what are you to dp with a set of persons who think it no reflection upon their intelligence to gravely dispute the economic advantage to a country of gratuitous gifts. They refuse to adopt in its naked simplicity the perfectly consistent and, from their point of view irresistible proposition of an eminent French economist, that the untaxed light of day should be excluded from their dwellings j but they will gravely tell us that it is a thing not to be tolerated that America should be allowed with her cheap kerosene, to do that for us partially at night, which the sun does for us altogether, and with our thankful acceptance, at noon-day. There is obviously some remarkable 8 Trade Depression and Wasted Resources. distinction in their minds between blessings bestowed on us by the direct fiat of Heaven and those accorded us through the less direct instrumentality of England, America, or Germany; and it may I think be set out with almost the force of certainty that if the kerosene were to come to us gratuitously from above and the sunshine at some comparatively nominal price from New York, our friends would accept the first boon with grateful hearts, and at the same time vote for such a duty on the daylight as would give the importers of it a lesson to be remembered. There is, of course, no distinction in principle between cheap light, cheap steam-engines, cheap trousers, or cheap boots; and, from the Freetraders’ point of view, it is a matter of indifference whether they come to us in ocean ships, or in fruitful abundance from the sky. The Protectionist section have, so far as I know, advocated and voted, and their Parliamentary sym¬ pathisers do habitually advocate and vote, for the almost reckless extension of our railway system. But are we not entitled to ask them for some explanation why they should thus do violence to their own most cherished principles. If Protec¬ tion be in reality and truth the summum bonum there is no necessity whatever why it should be conterminous with political boundaries. Take the case of such places as Bathurst or Orange. Just contemplate for a moment the glorious future which, Trade Depression and Wasted Resources. 9 from the Protectionist standpoint, awaited them. With the stern barrier-range of the Blue Mountains shutting them out from serious competition alike on the part of the Sydney manufacturer and of the merchant importer, they might have looked to com¬ mand the eventual supply of every requirement of luxury or necessity to the vast region in their rear. The deafening whirr of wheels and the crashing of looms should have been heard in their land, while the smoke of their numberless factory chimnies .should have been seen curling towards Heaven. But with your inconvenient aid, gentlemen Protec¬ tionists, the possibilities of this fair vision have been obliterated, and if your brethren beyond the mountains should ask you the reason why, I for one, shall be curious to see your reply. A range of mountains is nearly as good an obstacle to the free interchange of commodities as a Custom-house officer. Why then set your contractors upon it, and devote millions of money—wasted resources certainly from your point of view—towards the piercing and levelling and tunnelling of it ? Had your advocacy of the Protectionist case been in the interest, or supposed interest of the artisan and manufacturing class of Sydney alone, one could have understood your attitude towards these notable conquests over material obstacles, but as it is professedly put forward in that of the whole colony, it seems remarkable that you should have io Trade Depression and Wasted Resources. exhibited yourselves as the willing accomplices of those who have gone to so great an expense in practically reversing a set of conditions in which nature had so greatly served your more distant brethren. Any attempt to reconstruct an artificial barrier between Bathurst and Sydney, in substitution of the natural one which has been removed, w’ould,. in a country within the same autonomy, be too nakedly ridiculous to be accepted even by a Protec¬ tionist. I almost regret the impossibility, because much is lost by the absence of a good present con¬ crete example of the reductio ad absurdum. But perhaps we can correct the deficiency by permitting our minds to roam for a moment over European soil. Between France and Italy there stands out, in majestic relief, the towering line of the Alps. Millions upon millions have been spent, and the finest efforts of engineering skill expended, in doubly piercing this great natural barrier. France and Italy meet in the open tunnel, hand offered to hand. But in rushes a Custom-house officer from each end- breathless with excitement. I can imagine a most effective operatic scene being wrought out from the- incident thus :— Officers ( recti .)— Oh ! no, this cannot, must not be, For here are we, Our native industries to see Protected. Trade Depression and Wasted Resources. r France and Italy (to each other )— For why should you Us try to do ? France (excitedly )— Withyourcheap silks, sour wines,—Mar-r-rie! t ITALY (s neeringly )— With your cheap rubbish de Paris. Officers (sadly )— Our duty cannot, must not be Neglected. Slow music. Banners, with “ Fraternite, Egalite,” &c., &c., are torn down by the officers. France and Italy—each with appropriate long cloak, rapier, slouch hat, and ostrich feather—retire scowling, and the Protectionists of both countries appear on the stage restored to happiness. But my effort to place the whole business in the light of an absurdity is feeble indeed, when contrasted with the melancholy aggregate of folly which intrin¬ sically pervades so stupendous an exhibition of wasted or rather neutralised resources. There must, of necessity be taxation sufficient to meet expenditure. But the object of Protection,, thoroughly and consistentlyapplied,beingto annihilate the competing import, the revenue derivable there¬ from is one which, if we are to assume the success of that operation, must be appreciable by those only who are familiar with the peculiar formulae of the homoeopathist. Say that an impecunious Minister wants some trifle of a couple of millions or so, and 12 Trade Depression and Wasted Resources. as government with us is apparently conducted on the principle of the running tap, his needs in that way are more likely to increase than diminish. If then the advocates of protected industries are sin¬ cere in their belief that the Custom-house is the proper machine to help him out of the difficulty, they must necessarily rely on a continuous inflowing stream of foreign manufactures to supply his neces¬ sities. If this should so happen where is the pro¬ tection? In the contrary event the Government must find that asking for bread, they are likely so far as that particular section of their friends are concerned, to get nothing better than a stone. Those of us who protest against reactionary legislation in this department of economical science owe a great debt of gratitude to the Free Trade Association of New South Wales, for their able and persistent advocacy of the free trade case. But important as may be the considerations involved/ in it, a warning note in which Mr. Wise, their presi¬ dent/ has I perceive anticipated me, seems very appropriate to the present circumstances of the colony. It may be that free trade is better than protection. It may be that protection is better than free trade. The decision between the two is not to be regarded as other than important. But it is an importance which is rather relative than absolute, and the fear is that amidst the dust raised by the dis¬ cussion, questions of even more pressing moment Trade Depression and Wasted Resources. 13 may get themselves overlooked. There is nothing to prevent a country otherwise well governed from being prosperous under the worst of these alternative economic conditions. There is nothing to prevent a country otherwise badly governed from hastening to decay under the best of them. Taxation as I have said must be sufficient to meet expenditure. But what about this expendi¬ ture in itself? Is the Gaul at our gates that the money of our people should be fooled and muddled away as it has been? In private life the theory has to be accepted, whether we like it or not, that expenditure has to be reconciled to income ; and if we have really come to the point that the exact opposite of this process is the proper and inevitable thing in the sphere of government, and that there is consequently no other alternative than to have recourse to modes of taxation coming plainly within communistic lines, and the development of which must necessarily operate as a discouragement to the accumulation of wealth or its retention in the country when accumulated ; it may be as well to admit at once without needless qualification that Parliamentary Government in New South Wales stands confessed among men as a shameful failure. Up till now it has been the distinguishing feature of European as opposed to Oriental political systems, that the accumulation of property, of wealth, in i4 Trade Depression and Wasted Resources. other words of abundance , is not of the nature of a punishable act. It has on the contrary been regarded rather as a merit among us j and as an economic organism apart from any feeling of social repulsion towards him, the most grasping miser has perhaps unknown even to himself, a legitimate demand upon our gratitude. Every pound capitalised by him ; or indeed by anyone else, is an addition to the wages fund of the country, and to what I may term its industrial potentiality, no matter whether passively lent out at interest or directly used in some more active form of enterprise. But the apparent determination of ministers—literally the word I believe means servants, but we may as well ■call them what they appear to be, our masters, is in the current vernacular to go for the rich man. In recently attempted legislation which has so far been happily rejected by that branch of the legislature representing the better and more self-respecting section of our national life, but with a renewal of which we are peremptorily threatened, the principle is plainly asserted that as tax-gathers, the Government are no longer under any obligation to content them¬ selves with what can be spared from the floating income of the community, but that they have aright to concern themselves with the principal. In Persia or Morocco the- man who is fool enough to dangle his prosperity too obtrusively before his neighbours 'knows well enough what to expect when a message Trade Depression and Wasted Resources. 15 reaches him from the palace that he is “wanted.” But in point of principle there is no appreciable distinction between a confiscatory demand upon your property whether made by Shah Emperor or Vizier, or by the legalised tax-collectorof a constitutional state. It is the more necessary to dwell on this side of my subject because I can see no evidence of the existence of any sufficient appreciation in the public mind of the grave issues and far-reaching mischiefs really involved in it. Nor does it seem to have occurred to any one as out of place that a Cabinet Minister should have cultivated the applause of his hosts at an “eight-hours demonstration” banquet by the intimation that it was the intention of himself and his colleagues so to dispense the burdens of taxation as to fall especially “on those who had gained “ great wealth, and that capital would have to pay “ for its own production.” I hope that no one among my readers will lay hold of the supposition that I am writing in the capacity of the rich man’s advocate. He forms one of a happy minority of people whom unhappily for myself I can only admire at a respectful distance, and it is precisely because my active sympathies are with the more struggling sections of our social system that I have put together these words in the hope of being able more especially to serve their cause. I have tried in a modest enough spirit, to study the events of the world from both men and 16 Trade Depression and Wasted Resources. books, and if I have done so discreetly, I should be led to pronounce as the lesson of universal expe¬ rience, that under such circumstances as those now under review, the poor man will be the earliest as well as the most permanent participant in the de¬ solating effects which must surely follow the conver¬ sion of the threats of the last Parliamentary session iato the realities of the immediate future. Do not allow yourselves any false comfort from the circum¬ stance that the first move is likely to be directed more especially against the land. If capital placed in land or what may be erected thereon, be regarded as a fair mark for attack, there is no possible show <>f reason why for example bank stock or other forms of accumulation,—even the goods in your warehouses,—should be spared. Nor will they be spared. The land of course cannot run away, and it need not be disputed that in an initiatory raid upon it you may capture some very big fish. But it will be once for all. Idle land is a useless pos¬ session, either to its owner or to the community in which it exists. In a state of healthy and progres¬ sive development the tendency would be sooner or later to devote every available acre or allotment to some fructifying use. But do you suppose that people with money either to invest in or to lend upon possible houses, shops, hotels, engine works, fac¬ tories or the like, are so fatuous as to disregard the signs of the times ? Do you suppose they are Trade Depression and Wasted Resources. i likely to put their necks over the edge of an openly baited trap ? No. They will for a time play the waiting game. Everything they have will be turned as nearly as possible into cash in the like spirit in which a rich Persian may be supposed to concentrate his means into diamonds ; and if forced to the eventual conclusion that there is no sufficient body of active resistance to such schemes in the better sense and more active political morality of the com¬ munity, very many of them will probably solve the problem by removing both themselves and their possessions to some safer anchorage. The mere suspense engendered while such a problem is evol¬ ving itself is a calamity, and the industrial depres¬ sion which empties our workshops and fills our streets with idle, although in many instances willing candidates for w r ork, I do not hesitate largely to attribute to the unstatesmanlike boast—I care not whether conveyed in or out of Parliament—that “ Capital is going to have things made warm for it.” The attempt to discriminate between free and mortgaged land for purposes of direct taxation is one that will not for a moment hold. The land itself forms the corpus of the proposed taxation, and if the tax were founded on any principle capable of being economically defended it would justify no such distinction. And indeed for a Government under any circumstances to try and adapt their i8 Trade Depression and Wasted Resources. collections to the complicated interests bound up in nearly every considerable landed estate would be about as practicable and sensible as if they were to fix one rate of duty to be paid on a hogshead of brandy cleared by its owner, and a different one on some other hogshead because it may happen to be pledged to a banker. There has of late years set in a disposition among leading English and Scottish corporations, with large accumulations for investment, to come among us with the purpose—of course in their own legitimate interest—of supplying our market with that comparatively cheap capital, the scarcity of which has for many years operated as a standing obstacle to any large spirited enterprise. They have without doubt been influenced in this course by reliance on the moral security of a system of Government under which the right of people to hold their investments by an indefeasible title should be regarded as a fundamental admission. Does any one suppose that the able men who control these great accumulative reservoirs of cash will not hesi¬ tate when they see the tendency of your threatened legislation, and perhaps in the event withdraw their future operations altogether, in amazed disgust at your stupidity and folly. To them such an outlet for their lendings is at the best no more than a convenience. To you, the people of New South Wales, these and similar lendings are as the breath Trade Depression and Wasted Resources. ig of your industrial life. And if you can seriously deceive yourselves into the belief that it is your local rich man who will have the greatest reason to deplore your success in driving competitive capital from your shores, and the absence of which will permit him to rejoice over the prospect of a return to the fine old days of io per cent.; you will be the victims of an infatuation so crass that sympathy would be wasted upon it. I can understand that having parted with every acre belonging to the State, a very unprincipled Government could afford themselves the luxury of a sardonic smile at the prospect of pouncing upon the unlucky people who had perhaps placed their whole means of existence in the land, on the implied faith of being let alone. But I suppose quite half the surface of the country—I really do not know what the proportion is—at all events there must be immense territories still in existence as the public domain; and what are we to think of the wisdom of those whose threats amount to nothing short of an advertisement to every future competitor at a Government land sale, that he will at all times be the first to be remembered when some gaping void created by extravagance and folly has to be filled up. In the event of the confiscatory designs of the Government being endorsed by the deliberate voice of the country the implied warning will no doubt operate as a useful caution, but it is likely enough to 20 Trade Depression and Wasted Resources. cost the country a substantial diminution in the revenue from land sales as soon as the true effect of threatened legislation has time to percolate into the minds of those whose preferences if let alone would always incline to that form of investment. When these words were first written I was unaware that they were already in process of being abundantly verified. The following is from the speech of the Premier, Sir Patrick Jennings, to his constituents at Dubbo, 20 November, 1886:— “In making up the Estimates for the present year it was calculated that £350,000 would be received from auction sales of land ; but it was ascertained that although the Government offered all the statutory quantity of land for sale there was no demand for it. If they were ever so willing to sell the land, they could not make people buy it unless they could afford to pay for it. Instead of the land being greatly sought after,, not a third of the quantity offered by public auction had been sold. The quantity estimated to be sold was £350,000 worth, whereas the quantity sold, and that which it was estimated would be sold, during the rest of the year was £118,693 worth.” As surely as you expel political economy by the door it will manage to get back by the windows. After a series of disastrous experiments it will be found that after all there are but two alternatives to choose from. The one is to restore to competitors for the purchase of the public estate the confidence Trade Depression and Wasted Resources. 2 of which your threats and avowed intentions have deprived them ; the other is to find that the country will be without a market when next it has any con¬ siderable quantity of land to offer. I must presume to differ from Sir Patrick Jennings on the point that the question is one of people being able to “afford” it. It is a fact sufficiently well known that there are hundreds of thousands—I do not think it would be a great exaggeration to say millions—of pounds lodged with banks and lent to companies of various kinds, a large proportion of which would, with any feeling of restored confidence, flow readily into a form of investment which in this colony has always been a highly favoured one. But no machi¬ nery which their ingenuity can devise will enable ministers to combine the luxury of indulgence in threats against the investing classes for the sake of vulgar applause, with that of obtaining fair prices for what the country has to sell. The principal charm of these ministerial admissions consists in the apparent absence even of the germ of an idea in the minds of the speakers that ordinary human cause and effect have anything to do with this kind of business, such as that of foolishness producing its natural fruit. Oh no ! The note which pervades the whole thing is that of a good People’s Ministry being thwarted at every turn by the enmity of opponents, the perversity of circumstances, and the inscrutable ways of Providence. 22 Trade Depression and Wasted Resources. In the speech already quoted from ^617,521 is given as the expense, so I read it, of administering the public lands for one year. The figures are appalling, but their detailed analysis would be a task beyond my province on this occasion. Exposed to the dissecting knife they would probably support a view of the land legislation of the colony already familiar to our minds. Instead of being based on some simple and intelligible fundamental principles, capable of being applied in practice with economy and efficiency, the Acts constituting that legislation seem to consist of a mass of complications requiring on behalf of that section of the community more immediately affected by them, the creation of a set of experts specially educated to the not always possible task of comprehending them. Acts which render such machinery a necessity stand self- condemned. The Premier in a very candid spirit contrasted his figures already quoted with the ^103,803 spent upon similar departmental work in Victoria. And in offering the explanation that “ in Victoria the land was nearly all alienated,” the context shows with sufficient clearness that Sir Patrick was too honest a man to accept it as satisfactory to his own mind. Capital is to have things made warm for it! “ Capital is to pay for its production,” says the Minister. Note the beautifully rounded circle in Trade Depression and Wasted Resources. 23 which the argument moves itself. The protectionist vote, obviously to be exercised a la Parnell, is in the market. Let us for a moment do outrage to the better sense of the people and assume that it is likely to prevail. Mills, factories, foundries, and the like, are by the hypothesis to be seen rising up all over the place. But these very things are the visible and tangible embodiments of “ capital.” So that it comes to this. Capital is to be first enticed into large and necessarily speculative enterprises by protective imposts, and when once nailed to the soil it is to be vulgarly speaking “ rounded on” on the occasions, likely enough to be perennial, when an empty treasury wants replenishing. I may venture to express the opinion that under the circumstances now present to us you will have to catch your capitalists before you operate on them to the extent you would like. It would almost seem as if the sense of humour were departing from us when we fail to see the hollow artificiality of a set of systems so mutually contradictory and self-destructive as this.* * We have among us so many doctors to whose raids upon. “ capital ” and “ the land” constitute the first resort of statesmen in difficulties, that an extract from a recent lecture by Professor Leone Levi on the “ Economical Administration of the Resources of the British Empire,” may not be out of place. He ventured to say to the colonies:—“First determine what are the true functions of the State; reduce such functions to a minimum, and abide by your decision. Be sure that you do not undertake what private individuals Can best do for themselves. Take 24 Trade Depression and Wasted Resources. Many hitherto untouched sources of taxation unobjectionable from the economist point of view are open to any set of ministers aiming with single¬ ness of purpose at the good government of the country. But underneath this there stands the question whether with a return to a more modest conception of the functions pf government much more than half of even existing taxation is really necessary. I assert without hesitation that any set of men, be they from one side of the house or the other, who find themselves unable to govern this colony including the payment of interest on her debt, with a total revenue of ^5,000,000 all told, and with a margin to carry forward at the end of the financial year such as may be seen in the balance-sheet of any successful joint-stock company—do by that fact proclaim themselves unworthy of their high functions. I do not mean government in a poor cheese-paring fashion, but government with every recognition of care to secure and maintain a perfect equilibrium in your revenue and expenditure, and do not accumulate debt. In the levying of taxes do not touch the instruments of labour and wealth; do nothing to discourage accumulation. Let all articles necessary for food or manufacture come in duty free ; let all your products go out also duty free. Do not attempt to use the Customs revenue as a blind for a protective policy.” I should perhaps apologise for setting forth anything from such a source in the presence of the eminent local authorities quoted by Mr. Abbott, M.P., and of others whose instruction in the economic sphere it is almost our daily privilege to receive in the shape of letters to the press. But let it stand. Trade Depression and Wasted Resources. 25 what is liberal and dignified in the public service, and without prejudice to the prosecution of every needful public work. It cannot be done by men content to purchase parliamentary subserviency by the erection of expensive and frequently superfluous post-offices court-houses and railway stations in every Pedlington and Mudlington where two or three are gathered together. Nor by men whose concep¬ tion of our railway systems is so majestic as to shut out every possibility of their paying their own way. Nor by men in the habit of expending year after year the revenue of a considerable province on the unin¬ terrupted flow of unnecessary and mostly childish cablegrams between the Treasury in Sydney and the Agent-General of the colony in London. Nor by ministers whose expressed theory of necessary public works is not that the country should require them, but that occupation may be created for the unem¬ ployed.* And above all it cannot be done by men * Thus the Colonial Secretary in his place in Parliament on 19th October last:— “ If hon. members would take the trouble to look at these estimates they would find that the ,£3,000,000 was not to put money into the pockets of the Government, but to find labour for the people. The hon. members opposite were doing the best they could to starve the people into rebellion,” &c., &c. As this is a style of argument which would cover any and every form of expenditure involving the employment of labour, it would seem right to Mr. Dibbs that any honourable member in whose sincere opinion the heroic schemes of the Government are hastening the country into ruinous difficulties is only entitled to give expression to his sentiments at the expense of a peculiarly odious imputation. 26 Trade Depression and Wasted Resources. who regard it as within the legitimate province of New South Wales statesmanship to save the empire at all times that it requires saving. Of all things that kind of idea is the most fatal to the hope of a return to sober and well-ordered prosperity. I know that in touching on this point I touch something on which the sympathies of my readers may be divided: but I do not write with any view to the cultivation of popularity, and I shall decline to be guilty of such an affront to them as to assume that they can only tolerate one side of a discussion. It is by no means in the spirit of one seeking to initiate a gratuitous controversy that I include this subject within the range of my remarks. Some English war in the creation of which we will certainly have no voice, may at any time arise in some remote section of our planet, and it becomes the people of this country to seize a convenient opportunity when the question can be approached from a hypothetical stand-point, of expressing their settled conviction upon the question, whether—given another set of conditions similar to those in which the Soudan expedition originated,—the colony of New South Wales is to feel itself called upon to repeat that experience. It is not a question to be decided on the spur of the moment by any impulsive senti¬ mentalist who may happen to be in office for the time being. It should be given to no single man among us to arrogate to himself a prerogative which even Trade Depression and Wasted Resources. 27 Her Majesty the Queen is content to possess rather than to exercise. No one wishes to reflect in any ungenerous spirit on the past, but it cannot be left altogether out of view if we are to regard the question involved in it as of serious moment for our guidance in the future. It would be travelling out of my course to do more than refer in the most superficial way to that modern history of Egypt which began with the bombardment of Alexandria by an English fleet. The subsequent invasion of Egyptian territory was the act of an English minister who in his first clear definition of the circumstances which would justify that course, set them out—I use his own words spoken from his place in Parliament —as the “ maintenance of all established rights, whether they were those of the Sultan, the Khedive, the people of Egypt, or the bondholders.” The question whether an expedition* for these kind of purposes is the proper occupation of English sol¬ diers and sailors, is one which lam not called on to discuss. I merely give the quotation, to shed such light as it may upon the fraudulent afterthought that the integrity of the Suez Canal, which I believe to have been in precisely the same danger from Egyptian molestation as Westminster Abbey, was in any way prominent in the minds of the originators of that expedition. But the relations between Egypt and the Soudan never left room even for con¬ troversy. That Egyptian administration which was 28 Trade Depression and Wasted Resources. saved by the armed force of England from the proper fate of Governments which have become intolerable to the governed, was one which pursued a policy of remorseless, systematic, and exacting tyranny to¬ wards their comparatively recent conquest of the Soudan, which happily can only be realised by Englishmen froth what they read in books. If it were not for the fear of extending this paper beyond all tolerable limits, I could quote authoritative ex¬ tracts bearing on this which would fill the minds of my readers with horror and disgust. The Soudanese, forsooth, did not like their lot in life. They turned upon their tormenters, and this was the “ rebellion ” which seemed so intolerable to a then all-powerful English minister—for the English people had really nothing to say in the business—that it must be put down. And this was the ignoble quarrel in which our people here thought it right to take their share, amid a swinging of censers on the part of your press, your pulpits, and your swaggering rhetoricians, which has scarcely ceased to the present hour. If itwere England with her back to the wall defending her soil against a combination of foes, I think it would be a respect¬ able even if an impracticable ambition, to run to her aid. But the case is surely of another com¬ plexion when she sends an expedition to some distant clime, and disposes the scientific slaughter-machinery of Woolwich towards the perforation of a brave people, wholly void of offence towards her—guilty of Trade Depression and Wasted Resources . 29 no other crime than that of defending their own inherit¬ ance—a people who, in Mr. Gladstone’s inscrutable language at the very time when he was having them pounded down in squadrons by English mitraille — were “ rightly struggling to be free.” One would like to know as a matter of simple curiosity, what ulterior fate he had in reserve for any set of people whom he might find “wrongly struggling to be free.” Future wars may possibly not consist of a walk over the course and a few pot-shots at the horizon,, and if our people could for a moment realise to them¬ selves the absurd inadequacy of our means and resources to cope with really serious and protracted warfare in its aggressive aspect, there would not I think be much difficulty in forecasting their decision. There are always latent possibilities of mischief in the perverse activities of the English “ Foreign Office/’ as any one may gather who observes the language of the press cablegrams from day to day about such places for example as “ Bulgaria/’ The theory of its functions accepted by that department of State is one which has descended to it in an unbroken tradition from the time of the third William or probably a hundred years before. Not even a surgical operation would remove from it the idea but that it must mess and muddle about in every wretched squabble in which such names occur as Greece*, Turkey, Bulgaria, Servia, the Principalities, &c., &c. Quiescent but strong powers like Germany and 30 Trade Depression and Wasted Resources. Austria, the borders of which are within touch of the scene of the disputes ever and anon arising in that section of Europe, and which might be supposed to estimate most accurately any seriously disturbing cause against the interests of peace—these, although vitally concerned with the ever-shifting diplomacies of the business, never appear to excite themselves in the least. But nothing is too ridiculous for a Downing-street official to connect in his mind with the everlasting question of “ our road to India,” one to which every movement of the solar system is supposed to be subservient. And because his foolishness may some day precipi¬ tate the country into an unnecessary war, as it has many times done before, are we to shoulder arms and take shipping for the Hellespont, the Danube, the Ganges, or the Indus ? Because if so, any further •discussion connected with “ Wasted Resources” would be in itself a needless waste of mental energy. If New South Wales is to hold itself in readiness to ■embark in aggressive warfare for some such reason as that Lord Iddesleigh and M. de Staal have a difference of opinion about the proper end from which to break into an egg in Bulgaria, it would really not be worth while to argue seriously on behalf of economy in the application of our resources in time of peace. They would be so hopelessly mortgaged sacrificed and dispersed by our taking part in any serious operations beyond our own borders, as to make the Trade Depression and Wasted Resources. 31 preservation of what might remain scarcely worth an -effort. * The treatment of my subject has had chiefly in -contemplation the question of “ Trade Depression and Wasted Resources” within the colony. To give it a more cosmopolitan application, although tempting to me, would carry me beyond present possibilities. We can do very much to minimise the causes of trade and industrial depression among ourselves, but within certain lines they must neces¬ sarily stand affected by events outside of our control. A perfect conspiracy of waste seems to have got its grip upon the world. If we saw all the railway vans in Sydney employed for weeks together emptying the contents of the great shops and warehouses in York, George, and Pitt Streets, and shooting them into the harbour, we could not possibly misunder¬ stand the nature of the operation. Not only the immediate owners of the goods, but the larger world beyond them would have lost so much of its accumu¬ lated wealth, its wage fund, its capital, by an act of incomprehensible madness. But there is no essential distinction between such an act and many others which are daily accepted among the facts of life without apparently the smallest recognition of their •desolating effects upon the trade, the industry, and the personal well being of whole peoples. The -emptying, for example, of some ^20,000,000 of money upon the hopeless task of piercing the 32 Trade Depression and Wasted Resources. Isthmus of Panama.'" The spectacle of the French and German peoples taxing themselves to the extent of annual hundreds of thousands of pounds so that English colonies may be provided with wholly superfluous mail and passenger services. Or France, Russia, Germany, Holland, and America, each heavily taxing themselves so that refined sugar should be shot upon the English market at about the price of sea sand. Then look at the appalling expenditure upon the war services of Europe. That of England alone, exclusive of her Indian establishment, exceeds an annual total of ^30,000,000. One of the most mischievous of the English weekly prints which is always on the war path, characterises this •stupendous outlay as the necessary sacrifice which a great country imposes upon itself by way of premium of insurance. Well, it is a pretty big thing in the way of premiums, and that such expenditure is needed for any legitimately defensive purpose is altogether too ridiculous. Half the money would do this, and do it well. But it suits the governing people at home to multiply their garrisons everywhere and to cruise about crea¬ tion a constant menace and terror to Powers and * M. de I.esseps not long since shewed much soreness and disappointment at the refusal of the French Legislature to sanc¬ tion a public lottery scheme for the raising of an additional ^23.000,000 ! (reckoned in. English money), with a view to the further prosecution of these works. Trade Depression and Wasted Resources. 33 Principalities of the weaker sort, and hence the diversion of resources to purely destructive pur¬ poses, which otherwise would constitute a very perceptible restorative influence to industry and commerce. I should not have deemed these remarks as appropriate to my subject were it not that the baneful inheritance of the aggresive spirit is obviously enough exercising its influence on our own government, and that—jointly with neighboring colonies—there seems to be in active contempla¬ tion the formation of a colonial navy. We have had a good many expensive toys in our time, but nothing as yet to compare to this. The idea seems to prevail that in case of European war, some power —France and Russia are the favourite bug-bears with our panic-mongers—will have such a super¬ fluous amount of force on hand as to enable it to send a considerable fleet many thousand miles clean away from its base to attack us. Well : I suppose our harbours are in an adequate state of defence. At all events they ought to be so, or if otherwise, no reasonable expense necessary to that end should be spared. Has an enemy then only to ask us for what he wants in order to get it ? He will require food coal and water, not to speak of many other things, and if you have properly provided for these harbour defences how is he to come by them. Even assuming the absence of Her Majesty’s cruisers, what could he do to us beyond perhaps at c 34 Trade Depression and Wasted Resources. the first go off plundering and destroying some few merchant ships in the open sea: or, in the wildly improbable event of his being able to blockade our coasts, I am unable to see how at the worst he could do more than inconvenience us for a time. The four principal colonies will before many months are over be connected throughout by the junction of their various railway systems. With the free inter¬ change of commodities peculiar to each, would it be so very dreadful to have to live for a few months deprived of those which come to us from abroad ? At all events, to the protectionist section, such an eventuality should seem a thing of ideal bliss, almost worthy of a war for its realization. But the most comprehensive war which we can possibly imagine would leave some neutral nations outside its sphere. It would for example be safe to assume the United States of America as occupying that position. Is it supposable that the keen traders of New York and San Francisco would not know the value of your market to them, at a time when others would by the supposition be excluded from it. And do you think the Americans would care a brass farthing for imaginary blockades. And do you think that any combatant with his hands already full would care to add that great nation to the list of his enemies, by laying a finger on the smallest “ Yankee notion ” which might find its way to the neighbourhood of your ports. Trade Depression and Wasted Resources. 35 It is necessary to lay stress on these over¬ whelming chances in favour of our practical immunity from the consequences of any war other than such as we ourselves may provoke, because in no other way is it possible to protest with any chance of success against the ambitious schemes now being hatched in the war compartment of that patent incubator of folly which we call by the name of a Government. I have a strong suspicion that we owe the inception of many of these unwise schemes to the desire on the part of many of the Agents-General of the colonies in London to magnify their office. Some of them seem to spend a considerable portion of their existence in dancing attendance upon H.R.H. the Prince of Wales, and in the exercise of similar indispensable functions of their high calling; and with few exceptions it seems a practically impos¬ sible feat for any of them to contemplate a festive plate of turtle-soup without emitting a flood of vapid nonsense about Royal invitations, Exhibitions, Feder¬ ation, Imperial Institutes, and other ridiculous and pernicious fads. And as if there were not already a sufficient amount of machinery in motion for the manufacture of wasteful outlay and idle talk, there comes flashed to us under the sea, even as I write, the brilliant thought of a London Conference. If one could only hope to see these inflated officials restored to the humble although honourable function of buying locomotives and steel rails, and never 36 Trade Depression and Wasted Resources . suffered to come within a hundred yards of a Royal Highness or a book of telegram forms, the moral effect upon themselves would be a happy one, at the same time that the gain to the various colonies would represent economised instead of wasted resources to the extent of hundreds of thousands of pounds. On the other side let us glance for a moment at the benefactions which now and again fall to our lot. Every new form of natural wealth, wherever dis¬ covered—be it petroleum wells, gold, tin, copper—is just the same to us as if we were left a moderate share in a great legacy. Every great invention operates in the same direction. Each individual in this country or in this world is, for example, the richer for such a discovery as that of the Bessemer steel process. While bestowing on its inventor a fortune beyond the dreams of avarice it constitutes an inheritance to humanity almost beyond the power of figures to convey. An actuary employed by the Times esti¬ mated its value to English railway shareholders alone as equal to a free gift of £ 170,000,000. And it is quite credible. The ever increasing annual outlay on permanent way in what may now be looked back upon as the iron age threatened to wipe the ordinary English railway shareholder out of existence. He now thrives upon a moderate dividend at the same time that men cattle and merchandise are wheeled from end to end of the country at rates which, in point of paoderation, would, under other circumstances, have Trade Depression and Wasted Resources. 37 been impossible. I have not the means of knowing bow many steel rails have been imported into New South Wales: probably not less than 500,000 tons. If that is in any way near the mark it would be no extravagant estimate to recognise the Bessemer invention as equal to a free gift to the people of this colony of from ^10,000,000 to ^12,000,000 in first cost alone, leaving out of the question the vast indirect saving in maintenance of permanent way. So much for resources economised instead of those so freely wasted for you. And there are those among yourselves who pursuing the even and undemonstrative tenor of their way, render the country a most worthy service in developing its industrial capacities. Such names as those of Mort, Wyndham, Lindeman, Byrnes, occur to me in connection with this remark. I daresay there are many others. You do not hear of these gentlemen on the stump calling aloud to be “ protected.” To my mind they recall the self- sustaining type of people who made England’s greatness—men who at a time when it was the fashion to nurse and coddle industry with all sorts of nonsensical prescriptions, made it the limit of their ambition simply to be “ let alone.” Capital to pay for its own production indeed ! When you succeed in improving away from your little section of earth this kind of representative of capital—and if you try hard it is just possible you may succeed—the 38 Trade Depression and Wasted Resources. shutters may as well be put up without needless delay. In enumerating certain destructive forces, or what I should like to call “ wasted resources” as well as restorative forces which -1 wish to class as “economised resources,” it is more with the idea of offering you a sample rather than a category that I have selected illustrative specimens of each. That on which I desire to lay stress here is that neither to the destructive nor to the recuperative force can we possibly assume an attitude of indifference. Every million squandered upon an impossible or imprac¬ ticable or un-reproductive enterprise in any part of the world is, whether we like it or not, a million subtracted from that fund which gives your wool, your copper, or your tallow, the chance of a rising market. Every invention given to the world by the bright genius of a Watt, a Bessemer, or a Siemens, is a benefaction, the finer vibrations of which penetrate to the humblest hut in the Australian bush. Our part in the world is, within the measure of our ability to guard and not waste the resources which are within our control. Beyond that we can afford to take our chance. But one sadly feels that the assertion of certain principles and the legitimate effort to place one’s arguments in a convincing light, represent so much wasted exertion unless political life can be purified and separated from much which now degrades and Trade Depression and Wasted Resources. 39 defiles it. If I may partially repeat myself, it cannot be done if laissez faire is to be adopted as a per¬ manent motto by the many worthy and competent men we have among us. If the country of 1 heir birth or their adoption is to become a fit inheritance for their children, they must find their way into the more combative section of parliament and be seen and heard among the ranks of those who should join together in making the place intolerable to the mere rowdy, whether drunk or sober. The second chamber provided by the constitution has a high and useful place in it. But an objection to it consists in the fact that it drains off in some instances, men who can be ill-spared from the more active side of our parliamen¬ tary system—that side of it which, as at present constituted, unfortunately presents itself to the world as an advertisement of all the worst traditions of the country. Why should it be tolerable for scenes to be continually endured at the hands of those elected by the people for a most honourable service, which would cause them to be summarily expelled from any decent club. I am well aware that there are gentle¬ men in the Assembly who would do credit to any legislature, but they do not appear to be sufficiently numerous to make their influence predominant. It is not at their hands that I shall look for resentment as the reward of any honest effort, however feeble it may be, having for its end the placing of the forces of decency and order in an overwhelming majority. 40 Trade Depression and Wasted Resources. The colony is after all not so very young in years. It is about to celebrate its coming of age. A large wealthy class has existed in it for as long as any one now living can remember, a class able to bestow every educational gift on their children which money could command. Schools and universities, not things of yesterday, have been maintained by the country at a lavish cost. And all to what end ? Has no one a right to expect that these things should bear fruit in many ways not yet made manifest to us;— that they should give us something beyond expert cricketers and clever yachtsmen. Would it not indeed be a reasonable enough hope that they should provide us in moderate measure with statesmen of culture prescience and ability whom we could see in our high places with some kind of pride, and with the material of an elected chamber sitting in which it might be competent to people to feel themselves in the society of gentlemen—a word I use in no invidious sense as to the limits of its application. I should not hesitate to contend that if these kind of anticipa¬ tions were not reasonably within the probabilities of the future we may well commence our economies by dismantling and disendowing institutions which in the case supposed merely cumber the ground. If self-sufficient and illiterate incompetency constitute the best preparation for public life and the indispen¬ sable condition of obtaining its highest rewards, why go to an enormous outlay for no better purpose than Trade Depression and Wasted Resources. 41 that of disqualifying the rising generation from their chances of distinguishing themselves in it. It is time to be up and doing. If there be a boast in this world unworthy to come from the lips of a grown man it is that in which he takes credit to himself for being “ no politician.” There are poli¬ ticians and politicians. There is too great a disposition to identify the word with the tactics of the caucus and the tricks of the election-monger. But there is surely another and better sense in which it would ill become any member of a free community to reject it as signifying nothing to him. If any one were gravely to argue the proposition that we should tamely, and without an effort at defence, submit ourselves to foreign conquest,, he would justly be the object of your mingled indigna¬ tion and contempt. But if the better sense of the country is to confess itself a thing standing aloof and divorced in every possible way from any con¬ trolling influence upon the machinery of State,, permit me to ask in what essential respect we differ from the subjects of a conquered province. Unless there can be found some reversing gear in that machinery it will take less than another five years to land the country between the alternatives of repudiation, or a grinding and exhausting taxation which will undermine by the roots every industry and interest by which men live and thrive, and thrust back a noble possession into the political rank of Fiji or Jamaica.