The Position To-day and in the Future.

Having carefully studied the subject of the capital lent to, or invested in, Australasia during the past fifteen years, it is well that we turn our attention to the future. Are the borrowings of the past to be the measure of the borrowings of the future, and if so, what are likely to be the consequences? The purely colonial government borrowings in the ten years ending 1871 reached twenty-seven millions; in the ten years ending 1881, they mounted up to fifty-seven millions; whilst, in the last ten years, ending 1891, hey aggregated ninety-seven millions, Municipal indebtedness at present totals over eleven millions, the most of which has been contracted during recent yea re, and supposing the total was spread over the three periods in the same proportion as the colonial government, we should find the borrowings, the purely official borrowings of Australasia, to have been twenty-eight millions, sixty-one millions, and one hundred and three millions, respectively, in the three periods, bringing the aggregate public indebtedness at the close of 1891 up to 202 millions, entailing a yearly interest charge of eight millions. Adding the private indebtedness, we find a total of 400 millions as the lowest approximate estimate of the financial interest in Australasia possessed by capitalists resident in Great Britain, and that this entails a yearly charge on these colonies of from fifteen to eighteen millions sterling, equal to per head an average indebtedness of £100, and a yearly charge of £4 for interest; or, per family of five persons, an indebtedness of £500, and a yearly interest charge of £20. The stream of new capital flowing towards Australasia during the past ten years cannot have averaged much, if anything under eighteen to twenty millions sterling every year, and has represented no insignificant portion of the regular income of the various communities.

The position to-day is one that demands the thoughtful consideration of earnest raen. If the colonies, during the next ten pars, publicly borrow as much as they have borrowed during the previous ten, and if private investments are also on the same scale, then Australasia would in 1901 have an aggregate indebtedness of no less than £600,000,000, with a yearly interest charge of from £28,000,000 to £26,000,000, a sum very considerably Exceeding the value of the present annual wool clip of the whole seven colonies. The full effect of these growing interest charges is but little understood. During the past ten years we have said the annual new capital borrowed or sent out for investment has been close to, if not quite, twenty millions, and if the same were continued for the next ten years the interest charge at the intervals might be placed, roughly, at the following—eight millions in 1881, sixteen millions in 1891, and twenty-four millions in 1901. It will be seen that twenty millions borrowed in 1881 would pay the interest charges due to Great Britain, and leave twelve millions to actually come to the colonies in the form of excess of imports. In 1891, the interest having grown to sixteen millions, there would only remain four millions to actually arrive here. While it will be seen that in 1901 there would be nothing left to import, but that the whole sum would be absorbed in England, and, in addition, Australasia would have to ship other four millions to make up the amount due for interest. It may be said that every year when twenty millions of new capital have been obtained the whole sum, in some form or another, has been used in developing the wealth of the colonies, and that the increased wealth is easily able to bear the interest charge. Happily, to a considerable extent, this is true, but it is not altogether true, and we must not allow ourselves to dwell on the extent of our wealth when it is so enormously mortgaged.