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The Pamphlet Collection of Sir Robert Stout: Volume 80a

Checking Up New Zealand

page 22

Checking Up New Zealand

Editor's Note—This is the first of two articles by Mr. Russell on the po[unclear: litic] and industrial condition of New Zealand as he finds that experiment station of progress after an absence of five years. He has set forth his own conclusions with the sincerity of an investigator of the highest intelligence. The two articles make an important contribution to the knowledge of the world on a subject on which the world is seeking information.

Prime Minister Sir Joseph G. Ward

Prime Minister Sir Joseph G. Ward

Whose gift of a Dreadnought to Great Britain "in behalf of New Zealand "made him a hero of the Coronation, but saddled the colony with a debt of $10,000,000, or $10 per capita

In These Days of ours if once a Government begins to be radical it must diligently continue upon the radical path lest it be run over by the very engine it has created.

What was radical yesterday is conservative to day.

When a people once forms a taste for radicalism it cannot be daffed long by specious devices, half-hearted measures or palliatives.

Political democracy and industrial radicalism must keep even pace, otherwise one trips the other.

Representative Government as we have it to-day does not work well anywhere, even under the best conditions. What is called responsible Ministerial Government is already become a thing for the scrap pile. Room now appears for real instead of pretended democracy.

These seem to be the lessons of the present situation in New Zealand, which is generally regarded, I believe, as an outpost of advanced legislation.

It is a very good situation and worth watching.

For twenty years the country has been governed by one political combination having a strong initial impulse to do new and radical things.

Some of these things have been genuine; many have resulted in great advantages to the country; some have astonished the world because of the boldness of their innovations.

Meantime the world docs not stand still. The initial impulse of reform has greatly slackened in the governing coalition of New Zealand, while the rest of civilization has been steering up to the mark that New Zealand first set.

Consequently dissatisfaction takes root in the Modern Utopia, and daily grows. It begins to threaten the governing coalition after an almost unparalleled term of power. A population instructed to think about its affairs begins to suspect that some of the radicalism wherewith it has been entertained was chiefly nominal or simulated for purposes political. It begins to perceive a new range of radical progress upon which the Government, grown sleek and satiated with long power, is unwilling to venture. A new radical movement gets to its feet; the old radicals are slowly turning to conservatives; and the day of a new contest, far more instructive than the old, seems not far off.

You cannot in one generation or two change the racial instincts of an isolated people; you can when people have free intercourse with the world, as we have in America, but not when they are isolated. The next forward step in New Zealand will not be taken in haste. But its time is coming and when it arrives we must revise our New Zealand text books while we gain a new glimpse of the governmental ideas that are to be.

I suppose present needs always obscure past achievements. There is some tendency, because the governing powers are growing lukewarm about progress, to underrate what really has been accomplished here. It is an unfair and a baseless imagining. Such of the radicalism as has been genuine has been no failure but an enduring success. I ought to make that clear to start with. But on this road you cannot sit down and go to sleep on the things you have done. You must scramble ahead and do new things, while you keep one eye on the advancing machine behind you.

I was once shipmate in the Far East, or the New West, as you prefer, with a man that (not without reason) professed himself able to discern at a glance the nationality of any other man he might happen to see. The basis of his judgment in respect to New Zealanders struck me as highly significant. He detected them, he said, because they were always so ruddy and wholesome of countenance, so obviously well-fed and well-to-do; and they possessed an air that spoke both confidence and self-content.

Similar impressions, I suppose, lay hold of every traveler in New Zealand, and have given rise to a common belief that it is a country without poverty. Certainly its aspect gives joy to one wearied and depressed with the hideous slums and hideous destitution in other countries, the increasing masses of ill-nourished and ill-housed people that confront us in London or New York for instance, and the terrifying decline in the standard of living that curses the greater part of civilization.

Nothing of this kind is imminent in New Zealand; it was a threat once but is not now. Life there is easy, comparatively safe and eminently comfortable. For its size and population it is one of the healthiest and happiest countries in the world; it has the lowest death rate, the smallest proportion of extreme poverty, as a rule the smallest percentage of unemployment. No one ever starves in New Zealand; few persons go hungry; the world can be searched for another industrial community that, all things considered, fares physically so well. Schools are abundant and excellent; the general intelligence is of a high order. Since the Government has closed some of the usual avenues of exploitation by taking page 23 over certain public utilities not many great fortunes are being accumulated and the masses are not being visibly impoverished.

For a part of this pleasing prospect you must allow something to the advantages of soil and climate, and something, I suppose, to good fortune; but plainly other forces have been at work. About twenty years ago with the same soil and climate, at least, New Zealand looked in respect to poverty like the rest of the world; now to a certain degree she looks like nothing but herself; and for the great and striking difference there is no other conceivable explanation except the difference in her Government.

New Zealand has had a Government generally operated (in spite of great structural and other defects) for the Common Good.

The political coalition that for the last twenty years has had the management of her affairs was composed nominally of the one time Liberal and Labor elements. In twenty years coalition becomes amalgamation. No one could well detect now the two wings of the political machine once put together with some difficulty; but through all the changes the original ideas of the union were (for a time) carried out with unusual fidelity.

In these twenty years the Government has I remade New Zealand.

The Reform Record of Twenty Years

Here are some of the features of the reform policy, not all originating with the present regime, but all supported and furthered by it:

Woman suffrage.

A scientific land tax.

Supervision and rigid regulation of the conditions of employment.

Limited hours of work in many industries.

Extra pay at an increased rate for all overtime in these industries.

Discouragement of child labor.

Reduced hours of work for women.

A weekly half-holiday.

Compulsory arbitration of labor disputes.

Legal recognition of the labor union and its elevation to a place in the Government.

The breaking up of great estates by purchase and by taxation.

State aid to settlers.

State aid to home builders.

Public ownership of some public utilities.

State coal mines to make coal cheap.

State life insurance.

State fire insurance.

A State employment bureau to deal with the problem of the unemployed.

Old age pensions.

The beginning of compensation for injured working men.

A railroad system conducted solely for the public benefit with progressive freight rate reduction.

Free transportation of school children where required.

Housing schemes for the working popu-lation.

A Public Trust for the administering of wills and bequests and for other public services.

Five years ago, when I was on my first visit to New Zealand, most of these things were more or less experimental, and the pessimists and reactionaries were good enough to assure me that the experiments would fail. What aspects of success they wore were due, said these gloomy prophets, not to the least merit in the legislation but to fertile soil and general prosperity. Let the innovations be touched but once with the icy breath of hard times or business depression and see how the dreamy structure would collapse

I am obliged to record that these predictions have generally come to naught. The long prophesied test came at last and the radical program emerged from it still triumphant. Severe business depression fell upon the country in the New Zealand winter of 1908, following the American panic of 1907. About two thousand unemployed men walked the streets of Wellington; every other community felt the strain. Ordinary channels of employment were inadequate; the Government was obliged to start relief work for the idle. But nothing collapsed; nobody suggested that any part of the advanced legislation should be abandoned; the emergency passed like a shadow, and, after a quick recovery, New Zealand seems more prosperous than ever.

The total trade of the country has increased from $74,751,765 in 1895 to $176,683,575 in 1909; the imports from $30,000,645 in 1895 to $78,373,595 in 1909; the exports from $42,—751,110 in 1895 to $98,309,980 in 1909; the revenues of the Government railroads from $5,754,255 in 1895 to $16,754,255 in 1910; the total number of manufacturing plants from 3,680 in 1901 to 4,186 in 1906.

The census of 1906 showed that the average annual wages of male workers in the factories had grown from $409.25 in 1900 to $442.50 in 1905 and the average annual wages of female workers in factories from $156.50 in 1900 to $209.25 in 1905.

Nevertheless we are confronted with the fact that the country does not grow. It ought to grow, in view of its exceptional advantages, but it does not, and as soon as you look beneath the puzzling fact you will probably discover things calculated to make you think. Observe this table of the population, showing the changes in the last fifty-two years:
White Population * Increase
1858 59,413
1861 99,021 66.67
1864 172,158 73.86
1867 218,688 27.01
1871 256,393 17.25
1874 299,514 16.82
1878 414,412 38.36
1881 489,933 18.22
1886 578,482 18.07
1891 626,658 8.33
1896 703,360 12.24
1901 772,719 9.86
1906 885,578 14.99
1910 982,926 (Estimated)

I confess that I looked for a very much larger increase.

For fourteen years from 1890 (about the beginning of the present regime) the Government discontinued the assisting of immigrants. In 1904 the practice was resumed to a limited extent with the following results:
Year Persons
1904 1,058
1905 2,191
1906 3,880
1907 2,510
1908 4.466
1909 3,990
A Trio of the "Wise and Good" Ministers

A Trio of the "Wise and Good" Ministers

Mr. Russell calls the political control of Neu' Zealand a government by the" Wise and Good" and not by the people. In the group above J. G. Findlay, in the center, is Minister of Justice; David Buddo, to the right, is Minister of Internal Affairs; and James Carroll, to the left, has the title of Native Minister

page 24
J. A. Millar, Minister of Railroads, Marine and Labor

J. A. Millar, Minister of Railroads, Marine and Labor

Under his administration railroads have reduced their rates and not decreased their profits. Marine and labor problems hare not been solved, however, so satisfactorily

The Government restricts to British subjects its not very strenuous efforts to secure immigrants. None others need apply. The law does not say so but that is the substance of the situation. In 1907 severe educational tests were adopted for the purpose of keeping out Asiatics and other undesirables. The tests worked efficiently, being elastic and largely at the discretion of the immigration officers who, for reasons to be told later, are, or seem to be, inspired to discourage wholesale immigration.

Therefore, New Zealand, whatever its advantages for itself, is to the world of men no island of refuge. It lives within itself, carefully walled round by laws and customs, and this condition produces results that may suggest doubts about its future unless the present methods of society undergo a considerable change.

Labor Opposes Immigration

The policy of the Government has been (in general) to ameliorate the condition of the working class and restrict some of the operations of Organized Wealth without changing the foundation of things. It has accepted competition, war and dominant greed, but it has tried to save Labor from some of their usual results. This was a hard task. The sure way to keep up wages was to protect Labor from competition, and if Labor was to be protected against competition how could the doors be opened to immigration?

I may show by one little incident how this attempt to do a double bareback riding feat has, worked in practice.

The week before I reached New Zealand, fifty assisted immigrant boys had arrived from England. All came indentured to farmers under the following conditions: Farmers that wanted apprentices were asked to apply to the State Labor Department. About three hundred responded. From these were chosen fifty after careful comparative investigation as to character, means and fitness to be guardians of such a charge. When the boys arrived they were distributed among the applicants thus selected. The wages were $1.25 a week of which the Government took $1 to repay the cost of transportation. Twenty-five of the boys were from the east end of London, and twenty-five from the teeming tenement region of Liverpool, and a glance at any of them showed that they had been rescued none too soon.

On the night of my own arrival in Wellington I attended a meeting of the Trades and Labor Council of the City, and the Council adopted a strong minute against the importation of these boys.

As I was privileged to listen to the debate upon this minute I am under no misapprehension as to the reason for it. The reason was that the boys, being apprenticed first to farmers would ineviably drift thence to either employment and become competitors in the labor field.

So here we come upon the heart of the first trouble. The farmers need help: the workingmen insist upon conditions under which the farmers cannot get the help they need.

Meantime, here is the next pregnant fact, that happy as New Zealand is, and prosperous, the birthrate shows a marked decline.

Year Birthrate in 1000 of population As compared with 1882-1886. Taken as 100
1882-1886 35.40 100
1887 32.09 91
1888 31.22 88
1889 30.07 85
1890 29.44 83
1891 29.01 82
1892 27.83 79
1893 27.50 78
1894 27.28 77
1895 20.78 76
1896 26.33 74
1897 25.90 73
1898 25.74 73
1899 25.12 71
1900 25.60 72
1901 26.34 74
1902 25.89 73
1903 26.61 75
1904 26.94 76
1905 27.22 77
190G 27.08 76
1907 27.30 77
1908 27.45 77
1909 27.29 77

The promise of New Zealand, therefore, is to be a country of limited population and not to fulfill its manifest possibilities. With its almost incalculable resources, its rich volcanic soil, its variety and excellence of products, its mineral and other wealth, it could support thirty millions of people as easily as it now supports one. Its present rate of increase is about 20,000 a year, and so long as the existing policy is maintained that rate cannot be much greater.

It shuts out the immigration that might counterbalance its falling birthrate.

Likewise its wealth will not be developed, and while you can think of it as going on living within itself and content so to live, several questions arise as to that. For instance, take the pressure of increasing populations and increasing distress elsewhere. How long will this huge economic pressure allow a land of such richness to remain undeveloped and unutilized? Overcrowded China and overcrowded Japan are not far away. China is at this moment overrunning the is of the Pacific. The guns and fleets of Great Britain keep these peoples from the fat of New Zealand, but suppose these guns and [unclear: eets] to be otherwise engaged, suppose this shaken fabric of the British Empire to collapse. New Zealand has reared next to nothing for Its own defense; no great European peoples have adopted it for a home. How does that work out? If the present system be maintained, I can see nothing but the eventual breaking down of these barriers at the cost of New Zealand's blood and tears, and the utilization of this vast fertility to feed the starving mouths of the world.

Some persons make haste to blame the workingmen for all this; to assert that their selfishness and blind prejudice cause all the trouble; and that they keep out the immigrants. I cannot see that. Under present conditions they can do nothing else, for under present conditions they hold to work and to sufficiency by slender threads and must so hold. If you admit other workingmen in considerable numbers, one of two things will happen: all wages will decline or the newcomers will starve—under present conditions. By hard work, agitation, organization, bitter strife and long, patient fighting, the New Zealand workers have won out for themselves something approximating decent conditions of living. They have not won emancipation nor industrial justice, but a slight betterment in the terms of their employment. They are asked for the sake of some indefinite glory and the British Flag to throw away all that they have won. I do not see why they should, and anyway you may be perfectly sure that they will not.

But as soon as we admit that under existing conditions they must look out for themselves and put bread and butter above sentiment, we go around the circle and again confront the fact that so long as they look out for themselves, New Zealand will be no more than a nice little club and never the nation she was intended to be; and the finish of that condition will be just one thing.

In other words a half-way radicalism is inadequate to cope with these conditions. You cannot uphold competition and at the same time restrict it. Indeed, similar conclusions apply to the whole situation. You cannot be democratic and have a place in the mad dance of imperialism. You cannot accept part of the humanitarian doctrine and trample on the rest; your Government cannot be half fifteenth, century and half twentieth. Coronation days and free institutions do not mix. One thing or the other. All feudalism or all republicanism: there is nothing feasible between.

In New Zealand political democracy has not kept pace with industrial reform and one is tripping the other.

But to return to the workingmen, instead of surrendering anything they have gained, they are steadily demanding more, and their demands and growing restlessness are shaking the ministry with recurring alarms.

The Weak Points in the System

This brings us to the weak points in the New Zealand system.

The English method of governing by a responsible Ministry has many disadvantages. What are esteemed to be its merits have long been heralded to an admiring world. For the moment take a look at the other side of the ledger, seldom noted but still the more informing.

New Zealand is governed by Wise and Good gentlemen whose function is to hand out Government ready made like so much pie. They are not selected by the people, but chosen by a [unclear: mothod mos] undemocratic, on the strength their superior gifts, goodness and wisdom. Yet while they are not chosen by the people, they are liable to lose their jobs by reason of a change the popular majority. As a rest of this [unclear: wkward] and lop-sided arrangement, the Ministers continue to hold office by reason of incessant skill in walking the page 25 slack wire. They do not know what the people want and have only an indirect and clumsy way of guessing at it; so they balance and juggle on the slack wire between a gust of alleged public opinion on this side and a gust on the other, until they fall off.

For instance (and here is a good story), come to the rather pathetic struggles of this Government with the always overshadowing land question,

In the beginning, or thereabouts, great areas of New Zealand's fertile lands were grabbed off by rich men, in or from England, who made up great estates with the intention of bequeathing them to their descendants forever intact, after the approved English fashion. This was fine for the descendants but tough on the country, the grand estates being devoted chiefly to virgin forest or game preserves without any game. To give settlement and progress a chance the progressive Government, when it came to the helm, adopted an extremely radical policy. It borrowed money, bought up some of the estates on a practically compulsory purchase, cut them into small farms and offered them to settlers on terms of unparalleled generosity. In no other region of the world, I think, could a penniless man fare so well, for the Government not only rented the land to the settler on nominal terms but it advanced money to him and did almost everything else except to plant his crops and comb his hair.

But while the leases were made for long terms and at wonderfully low rates, the nation still owned the land. Now so strong in man (under [unclear: present] conditions) is the impulse to gamble in land, that the tenants resented this arrangement. What they wanted was land that they could sell or mortgage or trade with or get unearned increment from. In a few years there arose from the tenants (or most of them) a clamor on this subject, followed by their wholesale movement into the ranks of the Opposition. When I was here before, I wrote the remarkable story of the great Cheviot estate of 84,755 acres which the Government wrested from its owners and cut into hundreds of small farms. Every tenant on that estate promptly joined the Opposition and demanded ownership of the farm with which he had been so easily endowed.

Here was a case where a Ministry that did not care for slack-wire walking or a Government that was really democratic would have had neither difficulty nor perplexity. The issue was plain. To yield to the tenants' demands would be a surrender of every good thing gained by the Government's radical policy. If a tenant could sell his land, a few years would see the return of the great estates and of the exact conditions that the Government at such heavy cost had destroyed. Besides all of which, the Government's policy was a step towards that nationalization of the land that is the only way out of the land problem; so that what the tenants demanded was a retrograde movement.

In a genuine democracy like Switzerland the question would have been submitted to the people, who would have settled it on the side of progress and the Government's policy. In the kind of abortive and thumb-handed democracy that obtains in the British Empire wherein government is not by the people but by the Wise and Good, the situation was very different. The Wise and Good Ministry was confronted with the clamor of the tenants which threatened to cost somebody his precious job. So the Wise and Good gentlemen, being rattled, began to shilly-shally with the question and have been shilly-shallying with it ever since.

They are afraid that the tenants' vote added to other disaffected votes may produce some day an adverse majority in Parliament. Whereupon out they will go without a particle of real reference to the merit of the land question; for this is the vice of responsible Ministerial Government and Government by the Wise and Good generally.

Meantime the Good Gentlemen Afraid of Their Jobs have made in another way a certain concession to the agitation for freehold or ownership. Among the broad benevolences of the progressive idea in New Zealand is a plan by which conjestion of population is to be prevented in the towns and cities. If a workingman in New Zealand wishes a home he has but to deposit $50 with the Government, which thereupon builds him a house on the land it owns adjacent to his city, or if such land be unavailable it may buy a lot specially for him. The Government is so generous that he can even submit his own ideas, plans or preferences for his home, and so far as possible the Government will follow these. When the house is done the man gets it on extremely pleasant terms. Or if he does not care for this arrangement, he can rent at low rates one of the workingmen's houses that the Government has already built.

The rental or leasehold was the original device. Since the freehold has been agitated, the badly rattled Government has conceded to persons housed in this manner the right to purchase. This, of course, only increases the dissatisfaction of the farm tenants, and about their case the Government evidently does not know what to do. None of the Wise and Good Gentlemen that compose it seem to have any convictions on the subject, but about one thing they are unanimous. They want to hold their jobs, so that to disarm a part of the Opposition they are quite likely to make still further concessions backward.

The World's Outpost of Radical Legislative Experiment

The World's Outpost of Radical Legislative Experiment

Wellington, New Zealand, is the capital of the colony that aimed to be the Modern Utopia. It is a city fair to the eye, possessing the commercial advantage of a good harbor

page 26
The Busy Wharves of Wellington

The Busy Wharves of Wellington

Wellington does a big shipping business, but Mr. Russell asserts it would be doing a bigger if the $10,000,000 that went into a Dreadnought had been used to buy or build ships to be owned and operated by the Government

I ought to add that in the cases of the workingmen's houses an attempt is made to guard against the abuse of landlordism by providing that the property can be sold only to a workingman with an income of no more than $875 a year; and it seems fondly to be imagined that in some way this safeguard will avail. Hut New Zealand, of course, lacks as yet our long and lugubrious experience in trying to regulate things that cannot be regulated.

The Cost of a Coronation Hero

The disadvantages of this form of Government are further illustrated by the story of the New Zealand Dreadnought. When the announcement was made two years ago that this small country was to strain its resources to present a battleship to England, Parliament was not in session and the explanation was furnished that, as the gift must be made at once or not at all, the Government had decided to assume the responsibility.

The necessary arrangements were entered upon and when Parliament met, it was confronted with a situation in which it must either allow the gift to be made or see the resignation of the entire ministry upon an issue appealing so strongly to sentiment. On this consideration the thing was allowed to go on. One might be tempted to say that it was an amazingly blithesome spirit in which to assume so grave a responsibility and a Government that could get away with such an exercise of irresponsible power could get away with anything

The argument on behalf of the gift was that it would advertise New Zealand and prove her loyalty to the throne. I do not know how much it advertised New Zealand, but it certainly advertised her Prime Minister to the king's taste; also to his flattering attention. Before Prime Minister Ward had sailed for London he was easily the hero of the Coronation. I assume that there are persons in New Zealand that approve of the Dreadnought present; in fact, arguing on general principles, I am sure this must be so; but I have never met any of them, nor heard of them, and I am informed that if the electorate could have passed upon the question, or even if it could have been fairly submitted to Parliament it would have been negatived—a situation extremely difficult to reconcile with free institutions.

One good reason why it would not have been popular is the enormous disproportion between the value of the gift and the size of the 'population. The New Zealand Dreadnought is to cost $10,000,000; population about 1,000,000; cost per capita, $10. Total debt in 1910, $374,453,225; net debt per capita of white population, $363,25. In 1891 the total debt was $194,151,750; per capita, $297,75. In view of these facts to go out and buy $10,000,000 worth of Dreadnought for the junk heap seems a curiously reckless performance, whatever the social honors it may confer upon an aspiring soul.

Of this opinion I think I have no monopoly. A few months ago this Government by the Wise and Good undertook to float a new loan of $25,000,000 at 3½ Per cent. With difficulty it was disposed of, the nominal price being about 97 and the actual net price about 95, said to be the lowest in many years for an Australian loan. Social distinctions seem to come high.

No Government of human construction will be without its manifold flaws, but some of the flaws in this might be easily remedied. One is always moved to ask why a community so intelligent, so moral and so upright, should not be allowed to rule itself free from the lumbering interference of the Wise and Good—with or without social aspirations. Then take the persistence of that extraordinary anomaly, the appointive Upper Chamber. How shall we account for that? It is called the Legislative Council, and was originally designed to duplicate the House of Lords. Its members are appointed nominally by the Crown, actually by the Prime Minister. Originally they held office for life; now they hold it for seven years.

If this piece of surviving feudalism should attempt to veto the measures of Government a very strange spectacle would be presented; for the Government would out of hand appoint enough members to secure a loyal majority. This has been known and may be known again. I do not see how any such condition can be adjusted to any conception of democracy. All about the world the Upper House is a foolish, useless, and inexcusable encumbrance; nowhere is it quite so foolish as in New Zealand.

These are obvious reflections about the political democracy of the country. As to the industrial democracy some of the facts upon close inspection suggest that the radicalism is more apparent than real and that there is a wide difference between the name of the thing and its substance. In fact, I do not know that it is quite honest; at least there is much suggestion of the grand stand, the lime-light, and the bill-board. For instance, take the State coal mining. This is supposed to be one of the triumphs of New Zealand's radical policy by which the oppressive coal combina- page 27 tion is held in check and the people secure cheap coal. The State coal mines are there surely enough, two of them. And in 1909 of a total of 1,911,247 tons of coal rained in New Zealand these two mines had contributed 289,990 tons. This, on the face of it, would not look like very formidable competition. If observations among the trusts of America give any basis for judgment, the smaller product will not control the price of the larger until tails begin to wag dogs. Inadequate competition is largely a jest.

But even these figures give no true idea of the real situation, because of these 289,990 tons of State mined coal a great part was used to supply the State owned railroad, and at the amount really left for competition the coal combination must have laughed heartily. True enough, where State coal can be had, it has reduced the price from 50 cents to 37½ cents for a hundred pounds. But the number of places where State coal can be had is limited, and even in those places one might deem the Government competition to be halfhearted. At least it seems to make the purchase of its coal difficult instead of easy. Doubtless the explanation is that the Government does not wish to arouse antagonism from the powerful coal companies. This sounds familiar in American ears and indicates the same old game of caring well for the corporations. I don't see much difference.

I was told that the Government pays extortionate charges to the steamship monopoly for transporting the coal and that if it owned a few coal steamers it could put down coal at Wellington for 25 cents a hundred pounds.

"Why doesn't the Government own coal steamers?" I asked.

"It has no money; it can't afford to have them," was the reply.

For the price of the Dreadnought it could buy twenty coal ships and have something left. One fails to see the wisdom of this arrangement. Some visitors have remarked with ecstasy on the beautiful loyalty displayed in the Dreadnought gift. The beauty seems to fade rapidly in the face of these facts. In times gone by, I was wont to praise highly the wisdom of the men that govern New Zealand. I feel a little humiliated to find their wisdom gone daffy after Coronation Day eclat.

The coal deposits at the Government's mines are of enormous extent. If it wished, it could mine enough coal to crush the monopoly; it merely mines enough to trim slightly the monopoly's claws. This, I admit, is, so far as it goes, better than we do; but after all the difference is chiefly nominal and spectacular. Essentially in both countries the incorporated company is the overshadowing and fearsome thing before which aspiring politicians abase themselves to the national injury.

The next incident recorded in my note book has a still more home-like sound, and is, besides, replete with instruction for gentlemen that think we shall be regenerated by tinkering with the blessed old tariff.

A Little Joke by the Oil Monopoly

All New Zealand cities and most towns are lighted with electricity and gas, but aside from these a large rural population depends for its artificial light upon the lamp and kerosene oil. Towards this population also the Government is tender and regardful; it has many votes. At the last session of Parliament the state of the rural oil business was considered, and to cheapen the price of oil to the consumer, the import duty (which had been sixpence a case) was removed amid loud acclaim. But the rural oil consumer is still looking for the sixpence. The oil burned in New Zealand is furnished by a monopoly and the monopoly merely reached out and grabbed the sixpence a case thus saved to it by a thoughtful and generous Government.

And what is the name of the monopoly made thus happy?

It appears to be the Standard Oil Company, operating under one of its aliases.

It is indeed sweet to find Mr. Rockefeller's well-trained hand picking up sixpences in New Zealand as skillfully as it gathers dollars in our own happy country.

Yet the very curious fact persists upon the observer that New Zealand possesses petroleum deposits and that they are unworked. A small part of that Dreadnought's cost would open up an amazing amount of oil and shake the sixpences out of the Rockefeller hand. This is not a supposition but a conclusion based upon fact. I was in Burma at the time the Burmese Government blocked the Standard Oil's game and rapped Mr. Rockefeller's hand in a way that must have made it ache, and I know how easily the blow was given, and how in consequence thereof millions of dollars have been saved to the Burmese people.

Let us protect private enterprise and give it a fair chance," is one of the mottoes of the present Government. Mr. Rockefeller must smile as he contemplates it.

No one need overlook the facts that the Government's fire insurance has checked the rapacity of the fire insurance companies; the Government's excellent life insurance has conferred very great benefits upon the New Zealand policy holder; the admirable Government railroads have provided cheap and efficient transportation.

But the question is why, with the road thus plainly marked, the cautious Government fears to go on and do other things quite as obvious. For years the country has suffered from a monopoly of its chief water transportation; for years the Government has been urged to break that monopoly by building and operating its own steamships; for years it has declined this excellent advice. One learns then without much satisfaction that the chief company in the steamship monopoly is also an ardent supporter of the Government.

The Government Offices at Wellington

The Government Offices at Wellington

This building is said to bo the largest wooden structure in the world

The exact situation in New Zealand may be summed up thus: that so far as the Government has proceeded to stop the exploitation of the people by taking over the public utilities it has achieved great things. The publicly owned telegraph and telephone systems provide excellent service at amazingly cheap rates. The railroad system is conducted solely for the benefit of the public and upon the principle of reducing the cost of page 28 transportation as fast as the traffic increases. In the last fifteen years it has saved to the New Zealand shippers $10,000,000 in reduced freight rates. In the same space of time the American railroads, being privately owned, have increased their rates 18 per cent. Proportionately the New Zealand railroads have made in that time much the greater improvements and are now relatively in the better condition. Moreover they are the better managed. For one thing their percentage of expense to revenue has been reduced to 66, and their final net revenue, in spite of progressive rate reductions, is 3.80 per cent, on their total cost.

Similar observations might be made about the street car services and the electric light services, which have generally been municipalized and are now admirably conducted. Plainly the absence of so many public service corporations is the chief cause of the superior purity of New Zealand politics. There is very little legislative corruption, because there are few public service corporations to practise corruption. There are no railroad companies to bedevil politics, no traction companies to maintain rotten machines, no telephone monopolies to furnish "jack pots" and "slush funds."

Yet it is not to be denied that what is left of the exploiters, so far as they are able, exercise a pernicious influence upon New Zealand affairs, and that to corrupt with money is not the only means by which the power of accumulated wealth can gain its ends. For myself, I am unable to detect the moral difference, but the English seem to have determined that to influence with money is very bad and to influence with places and honors is quite good. Heaven forbid that I should dispute eminent authority in morals. But at least there is no doubt that wherever the progressive New Zealand policy has not put up such bars as I have described the trust grows and thrives at the expense of the people. A remarkable capacity for self-deception seems to be an Anglo-Saxon trait.

All Englishmen and most New Zealanders are fond of hearing about the enormity of the trusts in America. Yet the New Zealand ish combination has destroyed thousands of [unclear: ons] of fish to keep up prices, and year in and year out makes the fish dear that should be very cheap. Under the sway of the New Zealand timber combination, lumber cut near Auckland is exported to Australia, 1,280 miles, returned to New Zealand and then sold for less than it originally could be purchased for in the region where it was cut. New Zealand butter sells in New Zealand for 27 to 29 cents a pound and is transported to England where it sells for 25 cents a pound. Finally the "chain" store is advancing steadily through the country and having its inevitable effect; the great Central Financial Interests are absorbing one business after another; and the cost of living steadily rises.

That is to say, the world-wide process of combination, consolidation and unification does not miss New Zealand. Wherever the nation has forestalled it by taking over public utilities and operating them for the Common Good, all is well. Wherever it has allowed the thing to run its course, the situation is very much as it is elsewhere, including the usual farce comedy of regulation.

A New Regulation Nostrum

This reminds me that American practitioners of the regulative school of political economy have still a nostrum to learn of; at which I think there will be general surprise, most persons having assumed that we had experimented with every conceivable quack-salve. The new febrifuge is a remedy devised here for trusts—foreign born. Whenever it appears that a trust is operating to the detriment of a New Zealand industry, either employees or owners of such an industry may make complaint before a Board composed of a justice of the Supreme Court, an Under-Secretary of the Government and the Mayor of the town wherein the injured industry is situated. This Board is to consider the case. If it finds the trust to be guilty, it will apply to the Government for an adjustment of the tariff affecting the trust. For every dollar that the home producer will take from the price of his product, the tariff on that article will be increased two dollars.

Grand! You will perceive at once the improvement over our own celebrated specifics. Only in this case it is potential, not real. It has not yet been enacted, but it will be if the naughty trusts do not behave themselves. I am told that it is designed particularly against the Harvester Trust and the Agricultural Machinery Trust of America, and that the mere knowledge that it hangs over them keeps these trusts in order. To what extent I am unable to determine, but most of the harvesters used in New Zealand are furnished by the American Harvester Trust, nevertheless. It is a thousand pities that the remedy cannot be applied to the colossal steamship monopoly; then one could tell how far it would work.

So far as the progressive Government has dealt with the labor problem it has done many good and laudable things. I have no disposition to belittle these achievements, although in another article I shall tell the full story of labor arbitration in New Zealand and the wholly unexpected disaster into which it has fallen. At this time I merely call attention to these facts:

1.While the progressive Government has endeavored to do more for labor than for any other part of the community, it is from labor that it is likeliest to be overthrown.
2.While by heroic and unprecedented means this Government has tried to increase the wages and improve the condition of the toilers, even here in prosperous New Zealand the increase in the cost of living has outrun the increase in wages.

Partly because of these changes, partly for other causes, the great reform coalition that has ruled the country for so many years seems to be coming to the end of its marvelous career. General elections are held at least every three years in New Zealand. At the last general election the Government or Ministry suffered the loss of about a dozen seats. In the general election of this year it will probably lose several more. In the next general election, so say the prophets, it will probably be defeated and go out of office, after ruling the country for nearly a quarter of a century.

It will not be defeated for what it has done in radical measures but for what it has failed to do, and for lagging behind in the march of progress.

Meanwhile the signs of dissatisfaction increase. One of them is a new Labor movement that will probably mean in the end a new Government and a new era of progress. At the Dominion conference of the Trades and Labor Council held at Auckland, July 20, 1910, a platform was adopted upon which Labor is now determined to stand. This notable declaration insists that all the progressive legislation now upon the statute books must be maintained and sympathetically administered, and in addition demands these reforms:

The gradual public ownership of all the means of production, distribution and exchange.

Immediate nationalization of all monopolies.

A State ferry service, State coal ships and State factories.

Leaseholds for State tenants.

An increment tax on all land sales.

An increased graduated land tax.

Retention by the State of enough land to meet the demand of the national food supply.

No more borrowing by the Government, and

The Initiative, Referendum and Recall.

With such a platform the new movement seems likely to afford much occasion for thought to the cautious gentlemen that now sit in the seats of the mighty.

It appears therefore that the result of the advanced legislation of New Zealand, so far beyond any other nation, is to create a demand for still more advanced legislation; and how great may be that lesson to mankind!

It appears that one measure of justice is only a foundation stone for another measure of justice; the more of justice, enlightenment, decency, and equality we secure the more we are likely to demand. It appears that as soon as a community is well started towards a cooperative condition the way is opened for new ideals and broader conceptions; and how memorable may be the result of such a revelation!

New Zealand is still the experiment station of progress. The world for a long time is not likely to lose sight of her, because we may feel sure of this at least, that having tried so many social innovations and found them good, the masses of her people will not be content to rest where they are—whatever the Ministries may do or be afraid to do.

The second and final article setting forth the result of Mr. Russell's test in Checking Up New Zealand will be published in The National Post of July 1. Its subject will be The War on Strikes and the Effect

* Means excluding the Maoris, who number about 47,000.