The Dominion. THURSDAY, JULY 28, 1910. LABOUR AND THE GOVERNMENT.

Dominion, Volume 3, Issue 880, 28 July 1910, Page 4

The Dominion. THURSDAY, JULY 28, 1910. LABOUR AND THE GOVERNMENT.

. « A satisfactory feature of the Prime Minister's reply to the Labour deputation that waited upon him yesterday was his refusal to entertain tho suggestion that a State Bank should be established. Although in Australia tho Labour Government is strong enough, in nunir bers, to proceed with tlie first step towards nationalising tho banking business, there is no sign that in New 'Zealand the people who clamour for a State Bank without knowing anything about the science of money or tho principles of banking will at any early date become numerous enough to make a livo issue of the question. The Prime Minister is ready enough to commit himself to policies that involve the risk of .financial instability, but ho knows enough of financo to see that a naked attack upon the machinery of currency and exchange is certain to lead to a disturbance that will very probably end in disaster. His opposition to the proposal of our Labour friends places the question entirely outside the range of practical politics, and throws 'upon the Hoggs and Ells the task of converting the country to their views. And since theso gentlemen have first to- learn the A B 0 of money and currency, they will be a good many years getting their case ready for argument.; It was the necessity of dealing with trusts and monopolies, however, that the deputatidn named as the most important-of ,its concerns, and since the Prime Minister has already announced that he intends ■to introduce a.Bill on the subject, he was able to make a fairly extensive reply.- - With that secretiveness which, alone amongst the Prime Ministers of the Empire, he considers proper in the political leader of a democracy, he gave no inkling of I the direction of his Bill. We are i still entirely in the dark as to' whether he means to adopt the principle of the Sherman Law or whether he intends to operate through the tariff. He let it be seen, howover, that he is against the nationalisation of those industries in which trusts or monopolies have grown up. Unfortunately, he based his objection to nationalisation on what is, from the point of view of general principles, tho least important of all the availablo grounds, namely, the undesirableness of increasing tho public debt by the very largo sum that it would be necessary to Dorrow for the purpose. This is a quite sufficient objection, of course, but it is a much less important one than the undcsirableness of establishing any new - State monopoly, with its wastefulness and its almost inevitable unsound finance, its increase of the State-dependency of the population, its restriction of. individual competition and industrial efficiency, and its antagonism to the sound Liberal doctrine that the State should leave to the individual _ as wide an area of activity as possible. If a State monopoly, or State trading generally, is sound in principle, tho financial objection cannot be urged as anything but. a reason against immediate action. It is on this account that the Prime Minister's method of _fnecting the demand for nationalisation is unsatisfactory and unsound.

Equally weak was tlie argument employed against the demand • that horrowing should cease. • Thero aro few people who think that horrowing should ccttse all of a sudden, but the Prime' Minister chose to use as an argument against- self-reliance an argument that is relevant only when it is urged that Ihe policy of selfreliance should be adopted without a moment's warning. A Government that attempted to carry out a nonborrowing policy, he said, "would wreck itself and_ the country before it knew where it was." Now we venture to think, as John Ballance vontured to think, that the circumstances of New Zealand aro such that "borrowing should cease." Silt Joseph may, of course, set himself up as a wiser statesman than Ballance. But he cannot dispute the fact that the world-conditions are much more favourable to New Zealand to-day than they were in 1891— tho figures, actually show that the Government is annually wasting an amount that ought to be quite enough for a country of our size to borrow. As we have shown over and ovor again, the Government, if it kept the expenditure down to the extremely high figure at wlijch Mr. Seddon left it, would have a million and a half every 'year to play with. And if it adopted tho freehold land policy, it would find it unnecessary to borrow for land settlement purchase. Sound politics and good administration would give the Government in surplus revenue all the money for the developmental purposes which are now paid for out of loans. We have come to this: that in a country in which it was said J>y the founder of the degenerate Liberal dynasty nearly twenty years ago that borrowing should cease, it is now urged by his successor that twenty years of Liberal rule have i nroduced the situation that the

country will crumple up if it attempts to rely upon itself! The majority of the requests made by yesterday's deputation were left unanswered, so that the result of the proceedings will probably be as unsatisfactory to our Labour friends as wo think we have shown they must be, in the main, to everybody else.