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The Pamphlet Collection of Sir Robert Stout: Volume 27

The Progress of Victoria. — A Reply

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The Progress of Victoria.

A Reply.

The people of the British colonies on this side of the world are proud of the ties that bind them to the great mother country; and in all discussions that are raised on the subject of her colonies, and her relations thereto, peculiar interest is felt. The remarkable growth and progress of Victoria—one of the youngest and wealthiest of them all—affords a gratifying proof of the superior colonizing powers of the race from which her people are descended.

This being the case, it is somewhat painful to find that not only the people, but the material resources of the colonies, are sometimes strangely misunderstood and widely misrepresented. Writers, who pay transient visits to our shores, satisfy themselves with making observations and forming opinions upon the most superficial data, return home, and write lengthy articles to newspapers and journals, to give publicity to the fact of their travels and the information which they think they have gained. These articles are generally written in support of the individual views of the author, and ignore altogether the colonial aspects of the case and the altered circumstances and conditions under which old theories have to be applied, and old axioms reduced to practice.

The misrepresentations which form the subject of complaint on the present occasion are not, let us hope, wilful; and if the writer of the article in the Fortnightly Review will study the facts and figures which we shall have occasion to produce, he must admit that his deductions have been drawn from erroneous information.

Mr. Baden Powell, the writer of the article in question, has paid two visits to Victoria, and on the strength of these visits, and the observations which they may have afforded him the opportunity of making, but which could only have extended over a limited period, he has given to the world this article, the avowed object of which is to prove that New South Wales page 2 has made more progress under, and in consequence of its free trade policy, than Victoria has under a policy of protection.

The secondary aim of the writer is to prove that, taking these colonies as illustrations, John Stuart Mill's admission that protection might be found under certain conditions economically defensible in a young community," is wrong in theory and unwarranted by experience.

In order to accomplish this task successfully, the first thing he should have done was to make it perfectly clear that New South Wales is a free trade colony as unmistakably as Victoria is protectionist. If he cannot do this, his premises are incomplete, and his conclusion utterly breaks down. He appears to have had a notion that his position was open to attack from this quarter, and he appears also to have been equally alive to the fact that he could not make it impregnable; for he does the best he can under the circumstances, and intrenches himself as completely as possible by saying that New South Wales "has followed an essentially free trade course." What a convenience, what a very godsend, are these adverbs and adjectives—which seem to mean so much, but which in reality commit their employers to so little—to partisan writers, who, starting with a purpose, are compelled to make the facts square with that purpose; and which, if they will not, then so much the worse for the facts! In this case the very use of this qualifying word proves that Mr. Powell knows that the policy of New South Wales is not a free trade policy; for it is unreasonable to suppose that if he could have left it out, and thereby have made his case so much the stronger, he would not have taken that advantage.

We need not rest this issue upon the negative proof which Mr. Powell himself gives us. We can supply the same positive evidence as was doubtless within his knowledge, when he judiciously guarded himself by the use of the word "essentially."

The next point which, it appeal's to us, should have been placed beyond a doubt, was the relative advance of the two colones in manufactures, that being the only real test of the superiority of either policy, and to secure which advance was the sole object of Victoria in adopting her present course. Instead of this our critic passes very cursorily over this, the only really important fact to determine, and devotes himself principally to a comparison of our condition in relation to matters which have very little, if anything, to do with the question in dispute. We are not surprised at this, because if he had rested his case upon a careful and impartial analysis of the manufacturers of the two colonies, even with the scanty information which New South Wales supplies as to hers, he page 3 would have found it mpossible to make the facts—colour and twist them as he might—square with the foregone conclusion with which he set out, and upon his being able to do which his argument and his article depend.

We propose to deal with these two points in the order in which we have stated, and to show that Mr. Powell either knows so little of the question upon which he presumes to instruct others, as to render his utterances absolutely valueless; or that he has suppressed the truth and distorted the facts to suit his free trade views.

New South Wales has a climate and soil suitable for the growth and manufacture of sugar, and therefore very properly assists those industries by imposing a duty of 5s. per cwt. upon raw sugar, and 6s. 8d. per cwt. upon the refined. In this way the grower is amply protected, and the refiner gets an additional protection of 1s. 8d. per cwt. If this were done in Victoria, it would be stigmatized as a shameful departure from the true theory of political economy; but because it is done by our neighbours, it stamps them as "essentially" freetraders. In Victoria we have but one duty upon sugar, and that is 3s. per cwt.; and the assistance our refiners get is the permission to refine in bond, and so to pay the duty merely upon the manufactured article. On tobacco, the protection to the grower and manufacturer is, in both colonies, exactly equal. The Victorian duty is 1s. per lb. higher than the New South Wales; but Victoria imposes an excise duty of 1s. per lb. upon the home manufactured article, while New South Wales does not, which equalizes the conditions.

New South Wales protects her carpenters and workers in timber in the same way as Victoria does, by imposing a duty upon doors, sashes, shutters, and dressed timber. She protects her agriculturists, as we do, by imposing a duty upon bacon, hams, cheese, corn-flour, dried fruits, malt, maizena, raw sugar, chicory, hops, tobacco leaf, preserved and bottled fruit, jam, and wine. She protects her biscuit manufacturers, her manufacturers of chemicals, spirits, wine, beer, sugar, molasses, cordage and rope, jams and jellies, confectionery, cigars and tobacco, bags and sacks, varnish, oils, starch and blue, candles, paper, powder and shot, pickles and sauces, and many other industries which might be enumerated did time and space permit. This list is enough, at any rate, to show that New South Wales has no more claim to be called Free Trade than we have, and that those of her public men who, on the strength of such claim, bask in the beams of the Cobden Club, do so under false pretences, depending upon the ignorance of their entertainers and their own good fortune to carry them through.

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We have now to show that the Victorian policy of Protection has accomplished the object for which it was adopted; and there can be no better method of doing this than by comparing our progress in this direction with that of our neighbors. In making this comparison, it must be distinctly borne in mind that every advantage, except skill and energy, was on the side of New South Wales. She had a settled population, a long-established, self-government, abundance of raw materials for many industries, the start of us by the existence of many manufactories—boots and shoes, machinery, ship-building, to wit—and, above all, coal in abundance, which we have had to purchase from her. We were a young community with a roving population, the result of the decline of the gold yield, without any of the surroundings which New South Wales enjoyed; and if, therefore, our policy had succeeded only to the extent of enabling us to hold our own, John Stuart Mill's opinion would have been fully borne out, We shall be able to show that in every branch of manufacturing industry we have left our competitor hopelessly behind. The difficulty of showing this simply and clearly at once is very great, because New South Wales carefully abstains from publishing any set of statistics in relation to its manufactures similar to those which we publish in Victoria. For instance, we can, from our annual returns, show that the amount of fixed capital invested in plant, machinery, land, and buildings by our manufacturers has increased by nearly four millions sterling during the last ten years, the exact figures being as follow:—
Value of Land, Buildings,
Machinery, and Plant 1870 £3,543,431
Machinery, and Plant 1880 7,465,328
Increase £3,921,897
Then, again, we can tell what is the result of a year's work of our manufacturers by deducting the value of the raw materials operated upon from the value of the articles produced, thus:—
Value of articles produced in 1880 £13,384,836
Value of raw materials used 8,012,745
Value of the year's work £5,372,091

New South Wales furnishes no such information, and such as it does afford is all but valueless for the purposes of comparison, because of its meagreness and the difference of method upon which it is collected. As an illustration of this difference, let us take the statistics relating to agricultural implement manufactories. New South Wales tells us that in 1880 she had 50 factories employing 231 hands, and that she exported implements of her own manufacture to the value of page 5 £78. This is the sum total of the information that is available. Such as it is, what does it prove but that the 50 so-called actories may be nothing more nor less than country blacksmiths' shops, employing from four to five hands each, whose chief, if not only, work is to repair the implements of the neighborhood?

Victoria, on the other hand, tells us that in the same year she had 54 factories, 28 of which were worked by steam power, employing 975 hands, using materials to the value of £91,659, and turning out goods to the value of £202,535, carrying on operations with a fixed capital in land, buildings, plant, &c., of £127,380; and that she exported implements of her own manufacture to the value of £8,476, after supplying her own farmers.

If any further proof be needed of the folly of comparing or judging of the relative position of the two colonies by comparing the number of the so-called factories of the one with the number of the real factories of the other, we have it in the fact that while New South Wales, with very little more than one-third the land under cultivation that Victoria has, had to depend almost entirely upon her imports of implements to supply her farmers, notwithstanding her 50 factories. Victoria supplied her farmers entirely from her 54 factories, and had a few hundred pounds' worth to spare. The following statement will make this important point perfectly plain:—
New South Wales.
Imported agricultural implements in 1880 to the value of £32,061
Exported agricultural implements in 1880 to the value of 4331
Required to import to supply her own farmers £27,730
Victoria.
Imported agricultural implements in 1880 to the value of £9288
Exported agricultural implements in 1880 to the value of 10,483
Balance exported from her own factories, after supplying her own farmers £1195

We have gone thus minutely into this case not so much because of its own importance, as that it serves as an illustration for all; and it supplies a direct and conclusive denial of Mr. Powell's assertion that, notwithstanding the protection we give to our own manufacturers, we are "still forced to supply ourselves with these ' prohibited' or ' weighted' foreign articles; page 6 and import on an annual average about as much as unprotected New South Wales." We have selected it also because he has himself chosen it as one of three industries, the number of which, he says, "has largely increased in both colonies."

It would be trespassing too far upon the space at my command to follow the other two—foundries and clothing factories—as we have this one; or we could show exactly similar and even more startling results. Taking for the nonce, however, the value of the exports of their own productions in these two lines for the two colonies during 1880, we shall be able to form a very fair estimate of their relative position and importance.

Exported in 1880. N.S. Wales. Victoria. Difference.
Produce of clothing factories £8117 £180,208 £180,151
Produce of foundries 5190 95,320 90,130
Totals £5307 £275.588 £270,281

These are the figures for 1880; and what progress, if any, New South Wales has made during 1881, we have no means as yet of knowing. Victoria, however, increased her exports upon these two lines in the 12 months nearly £100,000, the exact figures being for last year £301,359. Would any sane man, with these facts before him, or available for his use if he required them, attempt to make it appear that there is any comparison between the two colonies in the matter of manufactures?

Mr. Powell admits that we have far outstripped our neighbors in the manufacture of cloth and woollen goods, notwithstanding that they had the start of us for years. Sydney tweeds were selling in Victoria long before we had a woollen mill in existence; now, we are driving them out of their own markets even. If this is not a proof of the wisdom of our policy, it is hard to say what it is. He attempts to detract from the evidence in our favor, which he clearly sees this fact to be, by coupling with it the statement that in the matter of sihp-building New South Wales is leaving us far behind. Now, without entering into a minute statement of the conditions and circumstances which operate to this result, as, for example, the monopoly which she has of the trade in coal, it is hardly necessary to point out that, so far from this fact assisting Mr. Powell in his argument, it has the directly contrary effect. We protect our cloth manufacturers by putting a duty of 15% upon imported cloth, and they succeed. We do not protect our ship-builders by putting a duty on ships, therefore, the page 7 building of ships does not increase with us. That is the fair and legitimate conclusion derivable from his own premises.

Mr. Baden Powell, as we have already noted, is very guarded and cautious in his statements, taking care to qualify them in such a way, as to make it somewhat difficult to join issue with him; and, even in those assertions which are most definite, he takes care to introduce a qualification behind which to shelter himself in the event of an attack.

Thus, when he speaks of New South Wales as being a Free Trade colony, he introduces the adverb "essentially," by which he hopes to escape the charge of misrepresentation. Then, in the two following assertions, which we are about to disprove, he introduces qualifying words which he hopes will serve him the same good purpose. He says, when speaking of our manufactures, that their development as compared with the great natural industries of the country is insignificant and further he says, "in neither colony is there any appreciable export of commodities manufactured in the colonies." The italics mark the words upon which he depends for shelter, but they will not save him. So far as New South Wales is concerned, his statement is, we believe, perfectly correct, as the examples already given amply bear witness, In the case of Victoria, on the contrary, it is utterly wrong, as we will presently show. We will prove that we have an "appreciable" export of our own manufactures, and will show what proportion it bears to the exports of the produce of what he is pleased to call our "great natural industries." The following tabulated statement of the exports of Victoria, for the years 1872 and 1881 respectively, will show at a glance in which direction most progress has been made, so far as the exports can afford any criterion. It must be borne in mind, however, that, great as the increase of our manufactured exports has been, it is nothing as compared to the increase in the local consumption which can be estimated by noting the falling-off of our imports of those articles which we are now making for ourselves, and by a reference to the value, before stated, of one year's produce of our factories.

The facts brought out by this table, compiled from the Government Statist's returns, are:—
1st.That the principal "great natural industry" has declined very considerably in the decade.
2nd.That the industry for a long time next in importance has not increased during the decade sufficiently to make up for the declension of the other.
3rd.That the third industry, that of agriculture, has made an immense stride during the same period.
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Table shotting the value of the exports of Victorian products for the years1872 and 1881, under the heads of Mineral, Pastoral, Agricultural, Manufactured, and Miscellaneous.
Articles. 1872. 1881. Increase, or Decrease thus—
Mineral: Gold & Specie £5,056,201 £4,679,737
All other Minerals 40,415 69,752
Totals 5,096,616 4,749,489 —£347,127
Pastoral: Wool 4,260,801 4,070,626
All other articles 146,789 593,749
Totals 4,407,590 4.664,375 256,785
Agricultural: Grain 23,685 687,213
All other articles 56,215 191,214
Totals 79,900 878,427 798,527
Manufactured:
Tallow 353,358 247,372
Leather 215,143 297,327
Preserved Meats 257,448 102,306
Butter and Cheese 9,494 100,987
Sugar and Molasses 100,121 208,782
Apparel and Slops 62,586 227,098
Boots and Shoes 4,494 45,856
Metal Manufactures 20,423 134,261
All other articles 100,802 697,159
Totals 1,123,869 2,061,148 937,279
Miscellaneous (unclassified; 42,341 127,128 84,787
Grand Totals £10,750,316 £12.480.567 £1,730,251
4th.That manufactures, the development of which Mr. Powell ventures to tell his readers has been "insignificant," have far surpassed either of the others in their progress.
5th.That the protected industries are those which are most prosperous and have made most progress. In the list of manufactures given, there are two only which are absolutely un-protected (unless there be a few included in the line " All other Articles "), and these are the two which show a falling-off in their exports. The decline upon these two articles—tallow and preserved meats—has been £261,128. The protected industries have supplied this gap in our exports of manufactures, in addition to supplying the whole of the £937,279 increase. The actual state of the case is, that protected industries have increased their exports by £1,198,407, while those of the unprotected have declined £261,128, leaving a net increase of £937,279.page 9
6th.That, seeing our manufactures have surpassed our agriculture, the question of the condition of the manufactures in New South Wales, as compared with ours, is seen at once. Agriculture is one of the "great natural industries," compared with which manufacturing development has been "insignificant" in New South Wales. In that colony their agriculture is one-third of ours. Their manufactures are far behind that small amount of agriculture. Our agriculture is three times as great as theirs, and our manufactures are before our agriculture in their progress and position.

We are aware that exception may be taken to the inclusion of tallow in the list of manufactures, but we purposely placed it there, lest we should appear to strain after effect. It is a pastoral product, and is usually considered a raw material. With us, however, it is a manufactured article, the " boiling-down " establishments being erected for that purpose alone. If we had placed it in the pastoral list, it would have reduced the increase shown on that line; while its removal from the list of manufactures would have considerably augmented the increase shown there.

For the rest, this statement speaks for itself; and the facts which it sets forth have only to be compared impartially with the position of New South Wales, to convince any one of the thorough ignorance of our critics of the entire circumstances upon which he delivers his judgment, and about which he assumes to instruct the British public. From the latest published statistics of New South Wales, he will find that the exports of their own products increased from £9,206,101, in 1871, to £12,679,782 in 1880—an increae of £3,473,681, He will further find that the increase upon wool alone was £5,743,373, thus clearly demonstrating from her own documents that her other products, manufactures included, had fallen off to the extent of the difference between the net increase and the increase upon wool alone—namely, £2,269,692.

If any additional proof of the great and increasing development of our manufacturing industries be required, we have it in the following extract from the address of the retiring chairman of the "Manufacturers' Association," delivered at its annual meeting a few days since. Speaking on this very subject, he said:—" Manufactures especially had made wonderful strides during the last few years, but the advance made during the last year was greater than any. He would venture to say that every manufacturer present could employ many more workmen than he was doing . . . . Foundries and workshops had now more work than they could do, and their work was in every way of a greatly superior description than used to be turned out in former years."

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Thus we have practically proved to ourselves as a community that protection is the "method that answers." Let us hope that, in Mr. Powell's case, it may be followed, not only by "thoughts that are true," but by words that are true also.

Will this gentleman, in the face of these facts and figures, maintain the assertions to which they supply a full, fair, and unanswerable denial? They show that, so far from the development of our manufactures being "insignificant" as compared with our "great natural industries," it has been greater than either of the other; and that the total exports of our manufactured goods have reached the very "appreciable " sum of over two millions sterling, which is constantly and rapidly increasing; and that the whole advance of New South Wales is due to its pastoral industry alone. Another fact which this statement brings out is this, that, of the £13,384,836, the value of the goods manufactured by us last year, we exported a little over two millions' worth, and ourselves consumed eleven and a quarter millions' worth. Is it any wonder, we would ask Mr. Powell, that our imports have not kept pace with those of New South Wales, seeing that we have been supplying ourselves to this enormous extent? The fact that our imports have not so increased is the very best evidence of the success of the policy which he is attempting to prove a failure.

Will he still assert that there is not much difference in the out-put of the factories of the two colonies? We venture to think not. Will he still assume that the number of factories so called, or the number of hands employed in them, in New South Wales has any real bearing upon the question? We hardly think he will, in the light of this fuller information. What has the number of hands to do with the question, unless we also know what is the extent of the power by which the machinery is worked? The work of our 32,000 employes is supplemented by machinery driven by engines of 14,502 horse-power; and unless Mr. Powell can show that New South Wales surpasses us in this respect, what purpose, but to mislead, can he serve by comparing the hands employed and the number of the works?

Having thus shown, fully and distinctly, the unfounded and erroneous nature of the assumed facts upon which the whole argument and theory of this writer rests, we might fairly leave all else that he has said to the discernment of his readers. If we adopted that course, we might be supposed to have chosen it because we were unable to reply to the other points raised by him against this colony. There are several statements, therefore, which we will proceed to answer. They are in reference to the questions of external trade, population, accumulations, and revenue.

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Taking these subjects in their order, we have first to deal with the question of external trade—the imports and exports. We have already shown that the increase of exports from New South Wales, so far as that depends upon her own productions and is not simply an increase of carrying businesss, is entirely due to the enormous increase of her wool yield. This increase of wool is due to the immense area, nearly four times that of Victoria, which she has to devote to pastoral pursuits, and to the great impetus which has been recently given to that industry, largely by Victorian capital and energy. The imports have increased principally upon those items which Victoria is now making for herself, and has, therefore, no necessity to import. The figures in relation to this matter are not correctly given by Mr. Powell. He says that the external trade of New South Wales has increased £10,000,000 from 1871 to 1880, whereas the increase has been only £8,620,673. He has also very materially mis-stated the trade of Victoria, by leaving out of his calculation all the goods transhipped in the bay, which are not included in the tables of imports and exports, but which form part of the trade of the colony. The real position is as follows:
Total external trade in 1871 £29,282,153
Total external trade in 1880 33,376,107
Increase £4,093,945

The relative increase of the two colonies, therefore, has not been as 10 to 3, as Mr. Powell states, but as 8½ to 4. Take away the increase of New South Wales' export of wool, of her own production, £5,743,373, and the total external trade of that colony would not have kept pace with that of Victoria. The surprising thing is, that with such an enormous increase in that commodity across the border, while the yield in Victoria has declined consequent upon so much land having been selected for agricultural purposes, Victoria has been able still to keep so far ahead of her rival in the matter of commerce, the difference between them still being £4,000,000, not £1,000,000 as given by Mr. Powell. In addition to the fact that our factories turned out goods to the value of 13½ millions last year, and so have rendered imports of very many articles all but unnecessary, we have no longer to import our food supplies. Ten years ago we had to depend very largely for wheat and flour upon foreign countries; now we supply ourselves, and have a large surplus to export. According to Mr. Powell's idea, this is an evidence of our failing prosperity; but we in Victoria hold a very different opinion. He is welcome to his theory, so long as we continue to reap the practical benefits of disregarding both it and him, and all who are of his way of thinking.

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There is another aspect of this case, which Mr. Powell in all fairness should have presented to his readers. When he was here in 1878, we were in the midst of the political turmoil of the Reform struggle, and he must know that the depression in trade which we were then suffering, and from which we are now recovering, was ascribed by all with whom he associated to political causes. If this was a correct opinion, it is surely absurd to ascribe it now to our fiscal policy. At any rate, to whatever cause it was due, it could not have been to our tariff; for, with the very same tariff, slightly altered in 1879 in a still more protective direction, we are now greatly increasing our trade. The Premier, Sir B. O'Loghlen, in a recent debate, stated that during the last year the increase of external trade had been three and a-half millions. Until we have the figures from New South Wales to hand it is impossible to say whether she has made a corresponding advance. We are assured, however, that our policy is not ruining our trade.

The next question is that of population; and there are several very patent explanations of the quicker growth of population in New South Wales than in Victoria. The first is, that our neighbor spends large sums in importing population, while we do not; the second is in the condition and circumstances of the people themselves. New South Wales is an old-established colony, and had families of all ages gradually growing up to become parents in their turn, long before the rush of a male adult population to Victoria consequent upon the discovery of gold took place. This condition of things continued in New South Wales without material disturbance, and, as a result, its population has gone on increasing in the usual geometrical ratio which prevails under such favorable circumstances. In Victoria the case has been exactly the reverse. Our population was composed at first chiefly of adult males, who came to find gold and go away again. It maintained its nomadic character for fully ten years, say from 1851 to 1861. Then, when gold-digging ceased to afford such constant and remunerative employment, we adopted our Protective policy for the purpose of providing work for as many hands as possible at the various trades to which they had been brought up, but which they had temporarily abandoned when they came to Victoria gold-seeking. The result was, that many of them were thus retained who would otherwise have left for want of employment. These settled down, married, and are now the fathers of families, the eldest children of which families are only now reaching a marriageable age. During all these twenty years our population has been increasing truly, but it has been an increase only from the first stock, page 13 and, as a result, our adult population to-day is small compared with our total population, and not much larger than it was twenty years since. The next twenty years will tell a different tale, as year after year brings these Victorian-born children to manhood and womanhood, and the geometrical ratio of increase begins. Directly the first children of these settlers begin themselves to become parents, every succeeding year will add a fresh batch to the number; and so it will go on until it will not be lack of population we shall have to complain of, but rather lack af room and comfortable provision. The third explanation is found in the fact, that we have had in operation amongst us for the last twelve years a very vicious land law, which, while it has helped some bona fide selectors to settle as permanent farmers, has afforded a great many more adventurers and unscrupulous persons the opportunity, by taking advantage of its conditions, to take up 320 acres of land upon an annual payment of 2s. per acre for three years; at the end of that time to sell the land to the nearest squatter or large estate-bolder for some £2 to £4 per acre; to pay the Government the balance of 14s. per acre out of the money they thus received; and to pocket the difference, varying from, say, £1 6s. to £3 6s. per acre. By this process the object for which the State parted with the land upon such terms, namely, the settlement of farmers, has been defeated; and that which it desired to prevent, namely, the growth of large estates, has been accomplished. In addition to which, our population has left us and gone over the border into New South Wales, Queensland, or one of the other colonies. This has been brought about by means of our Land Act, in the following way:—It is one of the conditions of the Act that no man shall select more than 320 acres. Accordingly, any man who has gone through the above process has no further opportunity for selecting in Victoria. He consequently goes, with the money he has made by evading our land law, into New South Wales or Queensland, where, with that sum, he can establish himself in a much larger way, as the terms upon which he can get land there are more liberal as regards quantity than they are in Victoria, our neighbours having fully twenty times as large an area to deal with. The fourth explanation of this population question is the matter of area itself. New South Wales is bound to have a larger population than Victoria, if for no other reason than its larger area. This is so self-evident that one need not waste words in comment. On this point we have only further to add, that with such evident reasons for a disparity in the rate of growth of population in the two colonies, a writer must be sadly in want of an argument to bolster up a weak and halting theory page 14 who would look for an explanation for this disparity to the operation of their various fiscal policies.

We now come to deal with the question of accumulations—the savings of the people as represented by the increase of capital. Our censor rests his assertion, that New South Wales is accumulating wealth faster than Victoria, upon two illustrations only, out of the many which are available, and which any unprejudiced and fair-minded writer, without a preconceived and preannounced theory to support, would not have failed to bring forward, Unfortunately for his character for correctness, both his illustrations are exaggerated, the first one grossly exaggerated, to suit his argument. "Rateable property," he says, "has doubled in New South Wales in the decade, and only increased by one-half in Victoria." This is absolutely contrary to the facts, as his readers would have seen for themselves if he had published the figures which he has readily done when they apparently told in favour of the position he desires to establish. The exact state of the case is as follows:—
Value of Rateable Property in New South Wales and Victoria respectively, in the years 1870 and 1880, and the increase in the same.
1870. 1880. Increase. Percentage of Increase.
N.S. Wales £620,056,530 £638,147,083 £18,090,553 90.19
Victoria £47,929,684 £83,847,418 £35.917,734 74.93

These figures, which are taken from the report of the Government Statist of each colony, show beyond dispute that instead of the difference in the rate of progress in this particular being 50 per cent., as stated by Mr. Powell, it has been barely over 15 per cent. They also show, what it was convenient for our critic to hide, that the smaller, and younger, but Protectionist colony, has accumulated wealth in the shape of rateable property to more than double the amount of its larger, older, but Free Trade neighbour.

The other illustration is also perverted and misleading, through the absolute ignorance of the writer of the question with which he ventures to deal. He says that the number of the depositors in Savings Banks has increased in New South Wales during the decade from 21,000 to 32,000, and in Victoria from 38,000 to 76,000; and from these premises arrives at the conclusion that "wealth in democratic Victoria is accumulating in the hands of a few." It would be interesting to know the exact process of reasoning by which this public instructor arrives at the fact,—that an enormous increase in the number of persons who are in a position to open and keep accounts at Savings Banks is a proof that " wealth is accumulating in the hands of a few." We can assure him, at any page 15 rate, that the 76,000 persons in Victoria who have made these deposits recognize and appreciate the fact that wealth is accumulating in their hands; and while we can show 76,000 such, to the 32,000 of New South Wales, we are not likely to alter the policy by which that result has been attained. He also, by this same inverted process of reasoning, assures his readers that the increase in the average amount to each depositor's credit in New South Wales, and its decrease in Victoria, is another proof of the concentration of wealth in the hands of a few in the Protected colony; and further, that "it is a result generally associated with a high tariff by all writers on political economy." If these writers, whoever they may be, have no better foundation for their theories than Mr. Powell himself adduces in this instance, neither they nor their theories are worth consideration. To any ordinary person, who is not a writer on political economy, a few bank deposits of large amount indicate accumulations in the hands of a few; while a large number of deposits of small amount indicate its distribution amongst many. Superior persons of the political economist class can, and very often do, see things in exactly the reverse way to that in which they appear to less exalted minds. There was no occasion, however, for Mr. Powell to go in search of any such far-fetched explanation of the facts which he sets forth in relation to this matter. There were plain and ample reasons for it close at hand, which he surely was well aware of, when he undertook to enlighten the British public upon the question; but to have used them would not have helped him to establish the position for which his article was penned. Accordingly, they were quietly ignored. One reason for the difference in the average amount of deposits, and presumably in the class of depositors, is the usually higher interest which these banks give in New South Weles than they give in Victoria. This, coupled with the other fact, that in Victoria no depositor is paid any interest upon any sum larger than £6250, fully explains why the average of our deposits is much smaller than the average in the other colony. This limitation was introduced about 1875, for the very purpose of preventing these banks from being used by capitalists, when fluctuations in the current rate of interest might otherwise induce them to avail themselves of the 4 per cent., fixed by law as the rate given by these institutions. These facts expose fully the absurdity of all Mr. Powell's conclusions in reference to this question.

There is another most important aspect of this case, which cannot and would not be ignored by any one who desires to do justice to the issues raised by this writer, and to the colonies interested, in their proper appreciation by the public which he page 16 addresses. This aspect of the case is set out in the question—Of what possible use, as affording any information respecting the relative advancement of any two communities in the accumulation of wealth, is any illustration of that advancement which embraces two only of the many and varied forms which such accumulations assume? If Mr. Powell's facts, arguments, and conclusion in this matter of Savings' Bank deposits had been all in his favour, instead of all against him as they are, it would have proved nothing as against Victorian accumulations, or the policy assumed to be involved; because in "Victoria the middle and artisan classes have a favorite mode of investment for which New South Wales has no adequate parallel, namely, Building Societies. These institutions pay their shareholders from 8 to 12 per cent., and their depositors at least 1 per cent, more than the banks; and the result is that they are enormously patronised by those who have small savings to make, and by those who build or purchase small homes for themselves by their assistance. A comparison, therefore, to be of any value, must be based upon the sum of at least all the large public forms of accumulation which are available in each colony. Unfortunately, the statistics of New South Wales are as defective in this direction as we have already shown them to be in relation to manufactures, consequently no such comparison can be made beyond that covered by the three items—rateable property, Bank capital and deposits, and Savings' Bank deposits. Taking these three, the comparison is as follows; and if Mr. Powell, or any one else, can see in it any ground for the belief or the assertion that free trade is preferable to protection as a wealth-producing policy, they have an obliquity of vision from which we can only wish they were free.

1870. 1880. Increase.
New South Wales:—
Rateable Property £20,056,530 £38,147,083 £18,090,553
Bank Capital paid up 7,608,780 9,531,212 1,862,432
Bank Reserve Funds 1,923,257 3,784,330 1,861.073
Bank Deposits 6,107,999 17,883,024 11,775,025
Savings Banks do. 931,688 1,489,360 557,672
Totals £36,688,254 £670,835,009 £34,146.755
Victoria:—
Rateable Property £647,929,684 £683,847,418 £35,917,734
Bank Capital paid up 8,305,224 9,126,250 821,026
Bank Reserve Funds 2.127,770 2,714,730 586,960
Bank Deposits 10,899,026 17,972,703 7,073,677
Savings Banks do. 1,047,146 1,661,409 614,263
Totals £70,308,850 £115,322,510 £45,013,660
page 17

These figures show conclusively which colony has the advantage in the matter of accumulated wealth. The only lines upon which New South Wales comes anywhere near Victoria are those relating to the business of banking; and the explanation of that is to be found in these two facts that, during the late political turmoil, very large sums were said to have been withdrawn from deposit in Melbourne and sent over the border for deposit in Sydney; and that immense sums were known to have been withdrawn for the purpose of making large purchases of land from the New South Wales Government, which sums, of course, found their way into the Sydney banks. During the last year (1881), the deposits have increased in Victoria to over £21,000,000. It is only fair to add that nearly eight millions of the increase of rateable property in New South Wales is due to the fact that that amount is the result of the formation of new municipal districts during the decade, and is not, as with us, the increase in the value of property previously subject to rates.

As a further illustration of the unprecedented progress we have made in the accumulation of wealth during this period, we may cite the following statement, in addition to the above, of some of our more prominent forms of investment.

1870. 1880. Decrease marked thus—Increase.
Total given above £670,308,850 £115,322,510 £45,013,660
Invested and deposited in Building Societies 1,210,330 2,352,808 1,142,478
Do. in Friendly Societies 186,383 450,718 264,335
Do. in Mining Plant 2,128,896 1,831,658 —297,238
Do. Agricultural Plant 1,512,013 2,446,321 934,308
Do. in Manufacturing Plt. 2,790,308 3,112,582 322,274
Totals £78.136,780 £125,516,597 £47,379,817

This table shows that, in these forms of investment alone, Victoria has an accumulation of capital of over 125 millions sterling, and that nearly two-fifths of this amount has been accumulated during the ten years in question, in which, according to Mr. Powell, the millstone of Protection has been dragging us down to ruin. We are so well pleased with ruin of this description, that we shall welcome its more rapid approach. It will be seen that there is only one line in the above list which shows any decline, and that is the line devoted to the mining industry, which has fallen off consequent upon the decline in gold-mining. But this industry, even, has had a great revival during the last twelve or eighteen months, consequent upon the facilities for obtaining money at lower rates page 18 of interest, which now exist; and a valuation of the plant made up to the end of 1881 exceeds that above quoted by £30,000.

In the face of these facts, which ought to have been known to any public writer who should undertake to instruct less informed persons, it is most unjust to malign and misrepresent Victoria for the purpose of supporting a political theory and proving some political economist in the wrong upon a question of policy.

There is only one other matter which remains to be noticed, and that is the argument founded upon the question of Revenue. It is unnecessary to dwell upon it at any length, as our critic, in his desperate attempts to make adverse circumstances prove the same point, has successfully answered himself upon this question. He first proves, to his own entire satisfaction, that our Import trade suffers terribly in consequence of our high tariff. Very good, say we; that is the best possible proof that our object is in course of accomplishment; we are supplying ourselves, instead of buying from abroad. It does not suit Mr. Powell's theory, however, to admit that such is the case—that we make our own goods; so, in another part of his article, when he is aiming at proving that our manufactures are little or no use to us for this purpose, he asserts that we have still to supply ourselves from abroad to as large an amount as New South Wales. This contradiction is so gross and absurd that, lest we should be thought to exaggerate it, we quote his own words as follow;—" If we compare the articles which are imported into Victoria under a heavy duty, and which enter New South Wales free, we shall find that, in spite of the increase in price, Victoria still is forced to supply herself with these 'prohibited' or 'weighted' foreign articles; and imports of these classes, on an annual average, about as much as the unprotected New South Wales." If this statement be true, will Mr. Powell explain how it is that our Imports have not increased as rapidly as those of New South Wales? Then will he further explain how it is that, if we import as much of these articles as our neighbours, upon which we collect heavy duties and they collect none, our Customs Revenue is, as he asserts, declining, while that of New South Wales is increasing? In the meantime, and until he determines which of these two contradictory and irreconcilable statements he intends to hold by and which he intends to abandon, we are relieved from the necessity of answering him. We are prepared to admit that our Imports have not increased so rapidly as our neighbour's, and that, as a natural consequence, our revenue from Customs' duties correspondingly lags behind theirs; but we accept these facts as the direct proofs of the success of our Protective policy, unless it can be shown that our people are less able and less page 19 willing to purchase what they require now, than they were before this policy was adopted. That they are not less able, the enormous growth of their accumulations unanswerably proves; and that they are not less willing is equally well proved by the fact that, last year, in addition to the consumption of imports of the high duty-paying articles—equal, according to Mr. Powell, to that of New South Wales—they consumed eleven and a quarter millions' worth of goods turned out from our own manufactories, the actual consumption being £17 2s. 5d. per head of the population of imported articles, and £13 10s. er head of home productions—a total of £30 12s. 10d. per head of the entire population. Will Mr. Powell produce one Free Trade population which can compare with ours on these lines? Until he does, not all his manipulation of figures, misrepresentation or suppression of facts, will serve his purpose in the least. At any rate, he must go on his travels again in search of same other "shocking example" wherewith to refute Mr. John Stuart Mill. Victoria will not help him, except with those, if they are to be found, who are more ignorant of this colony, its history and circumstances, than he is himself.

Toward the close of his article he expresses the opinion that there is in this colony a "reactionary movement in favor of a lower tariff," and gives utterance to a wish that his contribution will give fresh impulse" to this movement. We can assure him that there is no such movement as he imagines, and, further, that if there were, such articles as his, so manifestly unfair and unreliable, so easily opposed and refuted, would have just the opposite effect to that which he desires. He thinks he sees in the appointment by the Premier of a Royal Commission to inquire into the working of our tariff, of which Commission the writer has the honor of being Chairman, an indication that such a movement is going on. His opinion is based, in this case as in all those which we have alreade dealt with, upon a want of knowledge of the subject. Th Commission is appointed to ascertain what duties can be removed, if any, without interfering with the settled policy of the colony. Mr. Powell must have known this if he had even read the terms of the Commission before he ventured to publish his opinions of its purpose and scope. We may assume, therefore, that he went upon the principle that, if he knew little or nothing of his subject, his readers would know less; and that, as "among the blind, the one-eyed man is king," he might safely dare contradiction or refutation.

There is very much more evidence that New South Wales will follow our fiscal policy than there is any probability that Victoria will revert to free trade. The energy and vigor with page 20 which the protectionist party in that colony is carrying on its operations, through the lately-organized Protection League," bears witness to this fact.

Before closing this reply to this travelled economist, it may be as well to say that in the statement of our accumulations no account has been taken of State property in land, railways, waterworks and public works and buildings; municipal improvements, or church and school property, all such being exempt from rates, and therefore not rateable. These items represent at least £100,000,000 more, making a total fixed capital of £225,000,000. When it is remembered that this accumulation is the work of little more than thirty years, and the result of the labour, less the £22,000,000 borrowed, of an average adult male population of less than 200,000, it will be admitted by every impartial person that the fiscal policy and political conditions under which it has been achieved cannot be so bad as they are represented. At any rate, it is essential that any man who, on the strength of a flying visit to our shores, undertakes to pose as an authority upon either or all of these questions should display at least a fair acquaintance with his subject, and manifest an impartial judgment in dealing with it. These conditions we noticed to be "conspicuous by their absence" in Mr. Powell's article. Hence we have ventured to break a lance in defence of our home, our policy, and our institutions.

Life is too short, we are too busy, and we are too accustomed to the thousand-and-one misrepresentations of all that concerns Victoria, its politics and progress, its manufactures and commerce, its social condition and its material resources, its present aims, and its future prospects, its capabilities and its disabilities, which constantly appear in the British Press, to trouble ourselves about answering them.

In this instance the case is different. Our critic is a well-known public writer, who, by virtue of his visits to this part of the world, would be accepted, in some sort, as an authority; and the medium which he selected for the dissemination of his crude opinions and incomplete facts was well adapted to bring them under the notice of the public. Under these circumstances, we could not allow him or his misrepresentations to remain unnoticed or unanswered. We shall be well rewarded if we have helped our readers to form a more correct opinion of this grand colony than any they may previously have entertained, and if we have helped to secure for the future fuller information upon our affairs, before they speak or write, on the part of those who presume to instruct us in the mode of carrying on our Government.

Griffith and Spaven, Printers, Smith Street, Fitzroy.