Facilities and Difficulties.

Having shown that it is desirable and necessary to establish manufactures in New Zealand, I shall now consider the facilities that exist and the difficulties to be overcome.

The greatest advantage that we possess is that the Britain of the South is inhabitated by identically the same race as the Britain of the North. The race that has made England supreme in all matters commercial and mechanical, and which is improving on itself across the Atlantic. The manufacturers of England deny to us the right of developing our industrial instincts. We are to be the "hewers of wood and drawers of water." "roughing it" in the far distant Lebanon, while they the skilled workmen abide at home in Jerusalem earning higher wages in ease and comfort. We are to be the hodmen they the bricklayers. Before this condition of things is conceded we must assume that the Colonist has left his brains at home, and only brought muscle with him to the wilds. It is in reality the other way about. Through natural selection in coming abroad the average colonist is all round a better man than his compeer who stays at home. This being the case, why should we stifle our natural instincts, and accept an inferior position.

In a new country like this we have really an advantage as regards intellectual development. There are no time honoured ruts to travel in, no precedents or prejudices to clog our actions. Every one is fancy free to strike out a new path for himself. These privileges give us Yankee notions, and otherwise contribute largely to the prosperity of the United States. I have shown that this spirit is already in our midst, it is evinced in the readiness with which new ideas and appliances are adopted. A curious incident in connection herewith occurred recently. The Board of Trade sent for particulars of the wire tramways in Dunedin. Fancy her youngest colony being a step in advance of England in a matter of this kind.

Next to having the proper race of men, to commence with the greatest factor in building up a nation, is to have the where-withal to prevent that race from deteriorating—a good climate, pure water, and abundance of food, in every one of which New Zealand holds a premier place. It is no exaggeration to say that there is no country on earth better suited for the Anglo-Saxon race than the one we inhabit. The climate of New Zealand is not only conducive to industrial activity in the people, but directly favours many processes of manufactures, and, as already shown, gives a wide range to our power of production.

According to some high French authorities, "that country must be considered the most prosperous in which the inhabitants are able to have the largest ratio of meat for their food." The Americans eat 120 pounds of meat per annum; and although there is so much poverty and destitution in the Old Country, the average Englishman eats more meat than any other European, his annual consumption being 110 pounds. The next highest meat eaters in Europe are the French, with 66 pounds; and the lowest the Portuguese, with 20 pounds. If the French philosophers are right, "Britannia rules the waves," not by the force of intellect, but through the power of roast beef; and by the same rule New Zealand must be the most prosperous country in the world, for it is estimated that each of its inhabitants consumes from 200 to 250 pounds of meat per annum. As showing the superabundance of food in the Colony, it is calculated that the rabbits killed every year would yield upwards of 100,000,000 pounds of flesh fit for human use, all of which is wasted. What a god-send this would be to the starving thousands of London, who do not know from personal experience that man is a carnivorous animal.

With such an abundance of food, New Zealand can grow strong vigorous men, which is the main point, whether brain or muscle is required. Athough the rule does not hold good in individuals, it is well known that in com-munities the best eaters are the best workers. The page 81 human body is exactly like a steam engine, the amount of work that can be done being in direct proportion to the fuel consumed. This, I have no doubt is the secret of the success of many of our undertakings in New Zealand. Although wages are more than double the rate in the Old Country, the cost of production is not in the same proportion, for men here do more work.

With the raw materials and coal in the country, the industries of New Zealand have a large natural protection in the distance we are from the seat of manufactures. The charges connected with sending wool Home and getting it back in cloth alone amounts to 3d. per pound. This, on the quantity worked up by our wool mills, amounts to £25,000, a very handsome protection on £200,000 worth of goods. And, as already shown, we not only send Home the wool to be woven into cloth, but we send the com and meat to feed the weavers.

This question of manufacturing raw materials for home consumption on the ground is attracting considerable attention all over the world. The theory that England is the workshop of the world, and that the "natural way" is to send raw materials there to be manufactured is not universally accepted now. Prima facia a voyage round the world is not conducive to cheap production. It is found that cotton yarn can be produced in Bombay for 3¼d. a pound less than in Manchester that being the cost of sending the raw cotton home and getting the yarn back. There are already eighty-one cotton mills in India, and Mr. T. S. Teans says that were it not for the want of security to property, India would be a formidable rival to England in the cotton trade. After referring to the great decline of the silk industries in England, and the corresponding advance in America, the same writer shows that linen and jute are the only important manufactures in which England is holding her own, he says:—"In the cotton, wool, and silk trades, in the manufacture of iron and steel, in the mechanical arts, and a hundred minor industries, her pre-eminence has been threatened, and in some cases page 82 with unmistakable success." Referring to America and the Colonies, Professor Rogers says:—"There is no reason apparently except priority in the market, why the industry of the Old Country should not be transplanted to the new."

Comparing New Zealand with the other Australasian Colonies, it is found that she probably holds the best position for a manufacturing country. New South Wales has more mineral resources, but comes after New Zealand on all other points. Tasmania has all round as many natural endowments, but for some reason or other she seems to have struck the wrong track in industrial development.

One of the greatest difficulties to be encountered in establishing manufactures in New Zealand is the opposition, positive and negative, of those who have vested interests in the present state of affairs. As I have already shown philanthropic and all other sentimental arguments may be cast aside. We must go down to the bed rock of self-interest.

The first point to be considered is the relations between us and the old country. Teans says:—"It is not an uncommon sentiment at Home, that the Colonies while under English rule, ought not to be permitted to impose tariffs hostile to English trade, or indeed to follow any other fiscal policy than that with which the Mother Country has become identified." After showing how far the colonies have gone astray on this point, he adds: "Facts of this kind are not calculated to put the Mother Country in the best of humour with the Colonies."

This is one of the sentimental arguments which may be disregarded. We can transact business on strict business principles without detracting in the slightest degree from our affection for the old country, and loyalty to the old flag.

England's dealings with the colonies have always been a matter of business. They were originally founded with the object of providing an outlet for British trade, page 83 and any attempt to establish industries in them was promptly stamped out. A writer in 1750, after describing how colonial manufacturers were to be repressed, said, that the colonists should be encouraged to go on cheerfully as they were doing, because "only one-fourth of their products redounds to their own profit," and also because they paid high interest to the English mortgagee, and bought clothing that was old fashioned at Home, but "new fashioned enough" in the colonies.

In this transaction of Lord Brassey's the giver is himself thrice bless'd.

In a paper recently read at the Colonial and Indian Exhibition Teans advocates the construction of railways in the Colonies on exactly the same ground that Brassey recommends the lending of money to colonists.

In 1750 Lord Chatham said that the colonies should not be allowed to manufacture so much as a hob-nail or a horse-shoe, and in the same year a hat factory in Massachusett's was suppressed as a "common nuisance." In 1815 Lord Brougham said, "England can afford to incur some loss for the purpose of destroying foreign manufactures in their cradle," and the sentiment was endorsed by Hume in 1828.

A colonial factory cannot now be indited as a common nuisance, but Lord Brougham's policy is still in force. A struggling industry is frequently swamped by unfair competition, and instances are not unknown even in New Zealand of colonial goods being supplanted page 84 by inferior English imitations. This is the reason why some of our manufacturers were so chary of sending exhibits to London.

In 1885 the total exports of Great Britain amounted to £271,403,694. Of this the Colonies and other British possessions took £85,424,218, the share for Australasia being £28,104,258. The Colonial exports are increasing much faster than the Foreign ones, consequently it is only natural that England should do all in her power to retain and foster the colonial trade. Any movement that tends in the other direction is not only viewed with disfavour and discouraged, but promptly and vigorously opposed.

Referring to the Colonial Exhibition, the London Times says—"The manufacturing exhibits from New Zealand, as well as the other colonies, cannot well be a very agreeable spectacle to the English exporter." Two or three years ago, when a proposal was made to manufacture rails in New South Wales, the Times hoped that the industry would not be subsidised in any way, and about the same time a writer in an English periodical deprecated the idea of cloth being made in the colonies. He said it would pay us better to send our wool home and have it properly manufactured by skilled workmen.

The energy displayed by the disciples of the Manchester school in stamping out heresy has been frequently remarked. As far back as 1863 the London Times itself said: "Twenty years ago we were all thoroughly 'posted up,' as the Americans say, in every detail of the great free-trade controversy. Protection could not show its nose above water for a moment without being made the mark for a hundred harpoons discharged from vigorous and unerring hands"

The same vigilance is exercised to this day. The slightest eddy in the current of free trade is quickly obliterated by a spate of Cobden Club literature—meta-physical and statistical, serious and facetious. A discussion in the Parliament of New Zealand in 1885, brought page 85 forth a regular shower of these publications "thick as leaves in Vallambrosa." A recent article by Lord Penzance in favour of protection was promptly replied to at the instance of the Club, by one of its ablest writers.

As showing the thraldom in which the community is held by the creed of Cobden, it is said that when the Queen was petitioned to wear Irish poplin to encourage trade, the Premier advised against it on the ground that it was contrary to the principles of free trade, and might lead to international complications.

All this goes to prove that vested interests in one form or another are a formidable obstacle in establishing colonial industries.

The next greatest difficulty is cheap production, the "farthing an ell" consideration which Carlyle despised. Although frequently overlooked, one of the principal points in connection with it, is the quality of the article produced. After paying the cost of transit, and 15 per cent. duty, English cloth purporting to be made from New Zealand wool is sold in the Colony at the same price as the Colonial-made goods. But what is more, blankets and certain kinds of cloth can be bought in England for 20 per cent. less than the wool that is supposed to be in them. I have the actual figures as occurring several years ago. The price of the wool was from 1s. 10d. to 2s. a pound, and of the blankets, 1s. 2d. The explanation is simple enough, the blankets were not like colonial cloth "all wool." With cotton at 6d. a pound, and shoddy at 2½d., the problem is easily solved. Merinos, blankets, flannels, and similar goods can be mixed with 70 per cent, of cotton, and still keep the appearance of wool. For some purposes the mixture is an improvement, but this does not lessen the fraud in selling an article for what it is not.

Cotton is however an honest adulterant when compared with shoddy, appropriately called "Devils' dust." This is a mysterious commodity that reminds one of the Hindoo page 86 doctrine of the transmigration of souls. It never dies hut passes from one state of existence to another. This time it clothes a saint and the next a sinner. Like Iago's purse "'twas mine, 'tis his, and has been slave to thousands."

Shoddy is largely used in the manufacture of all kinds of woollen fabrics from frieze to broad cloth. The magnitude of the trade may be gathered from the fact that the rugs made into shoddy in Great Britain exceed the wool clip of New Zealand. A curious circumstance in connection herewith is that the clippings from our clothing factories command the highest price in the rag market. Being all new wool, the first state of existence they are considered the "artist's proofs" of shoddy.

So much is cloth adulterated that only a few manufacturers in England guarantee to give all new wool in their goods. A French manufacturer at the Sydney Exhibition, after critically examining the New Zealand cloth, and finding to his astonishment that it was all wool, exclaimed "well these New Zealanders are fools" If this be folly may they ne'er be wise.

There are few manufactures of any kind that are not more or less adulterated, and in some cases even the adulterants are adulterated. The chicory that is mixed with coffee is itself "sophisticated." The chief of the Municipal Laboratory in Paris, says that forty years ago seven-eights of the brandy manufactured was pure, but now out of a production of 50,000,000 gallons, not 1 per cent. is from grapes. The raw materials principally used are grain, beet-root, and potatoes. The shanty-keeper in New Zealand adds blue-stone, vitriol, and tobacco juice. The combined result is a decoction that I even a shearer's stomach cannot withstand.

The English manufacturer dresses cotton goods with size and china clay to twice its original weight, and sends the mixture abroad to clothe savages who have no regular washing day. Carlyle's "farthing an ell" is taken out in china clay.

The "Heathen Chinee" may be given to "ways that are dark and tricks that are vain," but he is by no means peculiar" in them. And in the matter of adulteration his standard is higher than the Englishman's. He uses "lie tea," but tells the quantity that he puts in. The average Englishman omits the latter part of the business.

Many of the improvements that have taken place in manufacturing processes of late years to cheapen production are really devices to improve the appearance of inferior wares. In the language of the old Scotch Act these wares "haveand onlie for the maist part ane outwarde shaw, wantand the substance and strenth quhilk oftymes they appear to have." More than ever it can be said that "things are not what they seem." Life may be real, but most things manufactured are a "sham."

This is one of the greatest difficulties that colonial manufacturers have to contend with. As they cannot reduce the quality of their goods, the remedy lies with the consumer, who must be taught to discriminate between the wares that he is asked to buy.

The labour question is another important consideration in establishing certain industries, notably the cultivation of tea, tobacco, olives, grapes, and other subtropical products that require a considerable amount of manual labour. One of the English companies that offered to establish a tea plantation in the North Island stipulated for a certain proportion of Maori labour at a given rate. It was, of course, impossible to comply with this condition; neither can we depend on the South Sea Islands for cheap labour, as Queensland is at present doing. It would not be desirable to see New Zealand over-run with Chinese; but it seems to me that if the class of industries just mentioned is to be developed it can only be done through them.

Cheap labour is necessary in some cases where manual work is required, but it is of much less importance in manufactures, where most of the work is done by page 88 machinery. Doubling the rate of wages makes a considerable difference in the cost of a chain of ditching done with a spade, but it is very little on a pair of boots when one man attending a machine can turn out 300 pairs a day. By our exports it is shown that we can produce certain raw materials and food cheaper than at Home; and, as in the case of better food, higher wages produce more work. "We may therefore conclude that the extra price of labour in New Zealand will not prejudice the establishment of manufactures, a conclusion that is fully borne out by the experience in America. A remarkable case in point has recently occurred. The New South Wales Government called for tenders for the largest bridge in Australasia, that over the Hawkesbury River, contractors to send in their own designs. Fourteen tenders were received, from English. French, American, and Colonial firms. The prices ranged from £280,800 to £702,384. There were three American tenders, and they were the lowest, the highest of them being £50,500 below the next tender, an English one. The iron for the bridge is bought in England, shipped to America to be manufactured, and re-shipped to Australia to be erected. This is a strong testimony to the energy and skill of our Yankee cousins, and it shows that dear labour is not incompatible with cheap production.

Referring to this subject, Brassey says: "I maintain unhesitatingly that daily wages are no criterion of the actual cost of executing work or of carrying out manufacturing operations."

Hitherto I have not struck a chord which is not responded to by every one who wishes to see industries multiplied in New Zealand. But the remarks I am now about to make will not be so unanimously subscribed to.

One of the greatest rocks ahead in our industrial development is the conflict of labour and capital. This has been a crying evil in the Old World, and it is intensified in the New. The seed has already been sown in page 99 New Zealand, and may bring forth a crop of weeds that will choke our struggling industries. The largest employer of labour in the Colony—the man who has emphatically done most to advance the commerce of New Zealand—informs me that he cannot employ a boy in the most menial capacity without first going hat in hand to the Secretary of a Trades' Society for permission. And just the other week we heard of 130 colliers going on strike at the Kaitangata mine because the proprietors would not discharge two men who did not belong to the Union. On the very day of the strike there were 960 "unemployed" on the relief works in Otago and Canterbury.

Union is strength, and combinations for mutual protection and assistance, in some shape or form, are common among all classes, and in many cases they do much good. But these objects can be attained without the absurd unreasoning restrictions that are put on labour by some of the trade societies. To think that employers such as I have referred to cannot employ whom they please is an outrage on common sense.

In England some trades unions prescribe the number of bricks that a hodman is to carry, and the rate at which men are to walk. And they nearly all stereotype labour by insisting on a uniformity of wages. As one star excels another in glory, so does one workman excel another in strength and skill, and why should the best man not reap the reward of his superiority.

Colonial employers are, I have no doubt, as ready as English ones to "extort the uttermost farthing" from their employées, but there is a much more equitable division of profits between masters and men in the New World than the Old. Cotton lords and millionaire ironmasters do not grow in the colonies. The position of the workman is in every way improved, he should therefore be more amenable to reason.

I believe that this question of capital versus labour has a very important bearing on the future of our industries, and it ought to be put on a satisfactory footing without delay. It is surely possible to settle disputes without resorting to expedients that bring certain loss to both parties.

Many of the industries hitherto established by public companies have been unsuccessful, simply because they were not gone into as an investment or a regular source of income, but as a speculation to be got rid of on the first opportunity.

This brings me to a point that has given rise to much controversy. Mill says "Industry cannot be multiplied to any greater extent than there is capital to invest"; and the opponents of manufactures in a new country construe this into meaning that industries are not to be started on borrowed capital. There is no reason why manufactures should not give as good security as agriculture. On the contrary, the security is probably better, but the English capitalist does not look on the interest alone. According to Lord Brassey, he wants three returns for his investment. This he will get in lending to agriculturalists in the Colony, but he only gets one return when lending to colonial manufacturers. Free traders and protectionists alike admit that the accumulation of wealth in England is mainly due to manufactures, and protectionists claim the same for America. In both cases a commencement was made with small means; why should we not pursue the same course in New Zealand? If manufactures are such an important factor in accumulating wealth, there can be no serious difficulty in getting sufficient capital for a start.

One of the greatest difficulties to contend with in establishing industries is the prejudice that exists in the minds of the public against colonial-made goods. I have frequently observed this myself; and one of our leading manufacturers considers it a greater evil than the want of protection. It is the old story, "a prophet hath no honour in his own country."

With the reputation we have for belauding the Colony generally, it is curious that the other side should be taken when we descend to particulars. A senator waxes eloquent over the benefits that are to accrue from the establishment of native industries, "to keep the money in the country"; but when he retires to Bellamy's, to refresh the inner man after his exertions, he will not touch what he calls the "beastly colonial."

The manufacturer to whom I have just referred sends some of his wares to a neighbouring colony. He does not, as a rule, "hide his light under a bushel," his brand is conspicuous on all his manufactures, but in this case it is judiciously suppressed, the goods are sold as English make. A similar incident is related of an American maker of fish-hooks; the hooks were repeatedly rejected as inferior by a New York merchant. By-and-by the manufacturer bought foreign hooks surreptiously from the merchant, and on offering them back as Home make they were also rejected.

This depreciation of Home productions is by no means a new experience in New Zealand, it has been the case all through. In the olden times it was an accepted theory in Otago, that crops would only grow on the cleared bush lands, and that the milk of cows fed on native grass would not make butter; and many of you will remember how difficult it was to get people to use colonial flour.

Another difficulty in establishing certain industries is the serious effect it may have on the finances of the Colony. Two of the manufactures most likely to succeed in New Zealand are the cultivation of tobacco and the distillation of spirits. The duties on these articles in 1885 amounted to nearly £600,000—about two-fifths of the Customs revenue. If large concessions are necessary to make them colonial industries, and if the benefits to be derived therefrom are worth such concessions, it is clear that the revenue must be made up in some other way. To use the popular expression "the incidence of taxation must be altered."

Among the minor objections to manufactures is that the occupation has a tendency to raise up a grimy, sickly race of mortals in which the higher attributes of humanity are deteriorating. It is true that factory hands have not the physique of their brethren who work in the fields; but it does not follow that they are less comfort-able or less happy—they have certainly less "care for the morrow," as their bread is sure in all weathers. On account of their higher education and attainments they have also more means of enjoyment.

The last difficulty in establishing manufactures that I will mention is one that is almost peculiar to New Zealand—local rivalries and jealousies—No sooner is a new industry established in one place, than other places take it up, quite irrespective of the consideration as to whether there is room for all. The result is inevitable failure in the particular industry concerned, and a prejudicing of all other industries of a similar kind.