SOUTH AUSTRALIAN LOAN.

Gisborne Standard and Cook County Gazette, Volume II, Issue 261, 16 February 1889, Page 2

SOUTH AUSTRALIAN LOAN.

OFFERS TO TAKE IT UP FURTHER CONDEMNATION BY BANKERS AND FINANCIERS. London, Feb. 12. The brokers are offering to take up the remainder of the South Australian loan at par, with an allowance equivalent to one-half per cent discount. The bankers and financiers condemn the delay in floating the remainder of the South Australian loan as degrading to the colony, and damaging to the prospects of the loans to be floated by New South Wales and Tasmania. The colony, they say, should either compromise to the minimum or withdraw the loan altogether.

THE SWEET USES OF ADVERSITY. The ignominious failure of the South Australian loan will be the best thing that ever happened for the colonies, if it serve to awaken the colonists to the danger as well as the diegracefulness of the borrowing policy. The opponents of that policy have raised the voice of warning for years past. They have urged that the colonies were becoming more and more the bond-slaves of the financial rings in London, and that every fresh loan that was raised, diminished their independence and placed them still more under the fear or favor of those who had no real interest in the colonies at all. They predicted, moreover, that one day these gentry would turn and rend some wretched colony in its hour of need, which would not or could not submit to their avaricious demands. New Zealand, we know, has more than once escaped that fate only by paying through the nose for the assistance of the Bank of England. South Australia has now suffered a rebuff which will probably throw its finances into dire confusion and perhaps aggravate the commercial crisis there, already severe enough through the failure of the harvest. This is fine sport for the stock-jobbers, ” The syndicates who joined in boycotting the loan,” we learn by telegraph from London, “ are -jubilant, because they think they have taught the colonies a lesson, which will prevent them attempting to defy financiers again.” We hope those words will be published and republished far and wide throughout the colonies, and be rubbed into people’s memory and understanding until they realize the full force of what they signify. If there were any true, high statesmanship in colonial politics, there should never ba another colonial loan raised, but on the contrary, the colonies should never relax their efforts until they have paid the last shilling of their present debts. Then, they might with just pride call themselves young nations, and then they would indeed present a spectable of prosperity, as genuine and substantial as unprecedented. This may be deemed visionary ; but it is not so at all. A candid examination of the affairs of New Jlealaud,— the greatest .inner as regards borrowing, and doubly a sinner because it was New Zealand that led the other colonies astray—will show that she has gained nothing whatever by all her borrowing. She has burdened herself with a debt of 35 millions, and squandered the 'money with both hands. Yet neither her population nor her production has increased any the faster for it, nor has she any public works or other facilities or advantages which she might not have had by this time if she had never borrowed a shilling. The public works expenditure iu New Zealand has now came to an end, and a great proportion of the public works already constructed are totally unromunerative. Some of them are abandoned and rapidly going to decay. But the colony has to pay nearly .two millions sterling annually, as a permanent charge, for interest on the debt. Half that amount, drawn from revenue, for 20 years, and judiciously applied, as it would hive been, if drawn from revenue, would had given all the public works she wanted: and the colony would now have been spared taxation of two millions a year. It could soon have paid off the old debt incurred for defence or muddled away by the Provincial Governments; and it would this day have been one of the wealthiest and one of the most lightly taxed countries in the world.

But the past cannot be recalled, and we shall doubtless be told that it is easy to ba wise after the event, though that cannot fairly be retorted against those who Ware equally wise before the event, and who protested against the borrowing policy when flrat it was proposed, as empathically as they now dwell upon its miserable results, Tbe only use, however, calling to mind the might have beans ia to point the way to what may be. We have shown that New Zealand onuld have done much batter than it has done without any borrowing at all; and what is true of New Zealand is true of all the colonies. What we wish to insist on, consequently, is that the oolonipa can do perfectly well without any more borrowing in the future. It would be a blessing to them tar the London money market to be closed against them absolutely ; but a still greater blessing would be for them to close it voluntarily against themselves, and never go near it again. It will be a bright day of hope |tor New Zealand at all events, When some strong, '.singleminded public man arises and inspires the people with the honor* able determination to borrow no more, but to exercise severe self-sacrifice, both in taxation and retrenchment, until they have set the colony free from debt,—Wellington Pros*