"TRUTH" ON THE NEW ZEALAND LOAN.

Inangahua Times, Volume VII, Issue 1134, 18 October 1882, Page 2

"TRUTH " ON THE NEW ZEALAND LOAN.

"Truth," of the 20th July, has the following article : — " So we are to be asked to subscribe three millions in the form of a new loan to New Zealand. Possibly this money may be usefully employed at the antipodes, but tlie question for us is whether we should be wise in lending it. I think that we should not. In 1579 the credit of New Zealand was at its lowest ebb, and the administration was disorganised. When Mr. Hall, the late Premier, came into power (I take my facts from the Press, a New Zealand journal of high repute) there was a deficiency in the finances of nearly one million sterling ; there was not a shilling in the Treasury ; tho accommodation to be obtained at the bank was exhausted, no provision had been made for the payment of interest coming due on the public debt, and the credit of the colony was only sustained :by piivate advances made on the I security of the Agent General. Mr Hull and his colleagues took determined measures to remedy this state of things, by increasing taxation and reducing expenditure, and they steadily set their faces against the issue of a j new loan. The Premier, however, has I had to succumb, and this is why the ' system of loan will be recommenced. Unfortunately, a loan in New Zealand can never be a small one, because when money is to be expended in one part of the colony, every other part insists upon its share in the plunder. Thus it conies to pass that railroads and other public works are made by the Government, which are certainly not to pay during the lifetime of the present generation. What amuses me, how-

ever, is, that the New Zealand newspapers discuss the question of loans as though wc ought to have nothing to say in the matter, but simply put our hands in our pockets whenever we are requested by our colonial friends to do so. New Zealand has borrowed too much, and too fast. In the forms of loans and moragages advanced on estates, she owes us quite as much as we can safely lend her. She has exhausted her security. If she caii find persons ready to make railroads, &c, for her, and to take the chance of these works paying a dividend, this is the affair of those persons. But no further Government guarantee ought to tempt investors to subscribe to a new loans. The only result of such a new loan being placed will be that the bonds of previous loans will be rendered less valuable. My own impression is--and I was roundly abused in New Zealand papers for stating it — that New Zealand cannot make two ends meet and provide for her current expenditure, inclusive of the interest on existing loans, without fresh borrowing. S^p is pledged already to pay to us an annual sum which either she cannot or which she will not provide out of her own resources. As long as she can every two or three years borrow of her creditors she will pay them interest on her loans. In the statement of the Colonial Treasures for the last financial year it is stated the surplus for the year was £215,000, and that the unexpended balance of former loans amounts to £624,000 ; neverthless, he concludes with the announcethat it is proposed to borrow £3,000, 000, which is to be raised at a rate of not more than a million per annum. Now I, for one, do not believe in a surplus, and in unexpended balances, when they merely serve as a preface ■ to a demand for new borrowing powers."