The Gisborne Times. PUBLISHED EVERY MORNING, TUESDAY, MAY 19, 1908. JAPAN’S NATIONALISATION FAILURE.

Gisborne Times, Volume XXVI, Issue 2194, 19 May 1908, Page 2

The Gisborne Times. PUBLISHED EVERY MORNING, TUESDAY, MAY 19, 1908. JAPAN’S NATIONALISATION FAILURE.

It has become quite the fashion nowadays to point to Japan as providing an object lesson to the rest of the world in many of the factors which make for national greatness. One of the achievements that was pointed to by those who have been devoting their hero-worship to the semi-civilised Orientals as an example of their . progressiveness was the action of the Government in taking over many of the chief national industries and converting them into public concerns. Chief amongst these were the railways which were purchased from private companies at an enormous figure. Now dt transpires that the energetic little people have been endeavoring to travel too fast-, and it is being brought home to them as it has to many communities of niuch older growth in civilisation that the nationalisation of all that is worth while handling in the way of industries is not the royal road to prosperity that many imagine. As a matter of fact although the nationalisation has only been carried out for a fow months, it has alroady given rise to serious-difficulties audio much discontent in Japan. The first troublo has come from shareholders. It was expected that when the Government took over the lines it would issue bonds in payment as quickly as possible. On the contrary, it is availing itself of its power and is delaying the (issue of these as long as it, cau. Tho reason for this lies in Hie critical financial condition of the Japanese Government -at the present time. It has now on its hands a heavy amount of unlloated bonds, £7,000,000 of tho Extraordinary War Fund, £8,000,000 of tho 1000 Budget and £3,000,000 from the Budget of 1007. Bonds and securities of all kinds are depressed,, and the authorities consider, probably rightly so, that the issue of an enormous amount of fresh Government securities would cause a further fall in quotations. The Congress of tho Clearing House has memorialised the Government asking it to pay as promptly as possible, but the Government refuses to give way. Another difficulty has just been the eauso of a Cabinet crisis and the resignation of two Ministers. Tho Minister of Communications considered it necessary, if lie was to conduct the service properly, that he should he allowed to undertake considerable extensions and improvements. These would have necessitated a loan, either at home or abroad, and the Finance Department declared that such a loan was impossible. After a long fight between the Treasury and the Stato Railway Department, tho Minister of Communications cut liis estimate for construction and -improvement for the coming year down to about £5,500,000. This was rejected by the Finance Minister, and a compromise was come to between the two Departments reducing the estimate to under £4,400,000. The Elder Statesmen now interfered and declared that, in the existing

condition of tlio national finances, the total expenditure must bo- still further decreased. ‘Thereupon tlio Alinistor of Finance and the Alinistor of Communication!! resigned, and but lor the action of tlio Alikiidci several other Aliuisters would have quitted ollici) also. This means, in other words, that the question of railway construction and development is no longer ■in Japan a business problem to bp dealt with by business men, solely on business lines. It is a matter ol State policy, and tlio extension!) or improvements of the service depend on a hundred other issues affecting national linaiices. What has been the effect of the nationalisation on tlio ordinary railway services? Answering this question, Mr. F. A. AlcKenssio, tlio London “Daily Alu-il’s” Eastern eorrospondoiit, says: “There is general complaint that tlio lack ol competition lias done great harm. Tlio management of the railways lias been so seriously disorganised that many oven of those who were formerly in favor oTAlio new method are now against it. 'The general opinion in the country, among the Japanese themselves, is that nationalisation has. been a decided mist ike. it lias Imperilled tTio national linaiices; it lias prevented necessary railway impnivomonts that would otherwise have been conducted oil ordinary coinmorical lines, and it has checked the oflicTency of tile service.” Under theso (Hreiimatanees it is not hard to understand how it is that the Government of Japan is now engaged in consideration of tentative projects for relieving itself and, at the same time, serving the douhlo pur-pose-of -building up the industries of the country, providing additional exports for its subsidised steamship linos, and increasing its own income by the revenues derivable from increased production. It is in this connection that financiers, engineers, and railway men from foreign countries have been in conference with certain leading men in Japan. It :s understood that the proposal now finding favor is -that the railways of Japan should bo leased for a -period of years to a private company or syndicate, which will take from the shoulders of tho Japaneso .Government tho financial burden and responsibility it lias undertaken in this connection, which will pay to the Government a certain percentage of profits, and undertake improvements and extensions under a given schedule.