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The Evening Star SATURDAY, JULY 11, 1874.

Whatever our opinions respecting free trade may be, they do not extend to sanctioning a breach of contract on the part of a Government with capitalists, who on faith of certain fiscal arrangements have invested money in new industries. On this ground, therefore, we must object to* the course proposed in regard to imposing additional duties on spirits of Colonial manufacture. Whatever reason existed for a differential duty remains in full force, and is rather strengthened than weakened by the degree of success that has attended the measure. We are quite ready to admit that the whole system is an error: we have pointed that out time after time ; but it was deliberately adopted by the Legislature; the differential duty was held out as au inducement for opening up a new industry; in faith of its continuance large distilleries have been erected at immense expense, and the system having realised its purport, the Government now propose to reduce the profits by increasing the duty. We cannot think the country will sanction such a decided breach of faith—for it is nothing short °f it—at least, in regard to institutions already at work ; although we consider it quite competent for the country to say, « We have discovered the mistake we have made, and will not agree to any other distilleries being worked on similar terms.” No doubt exception would be taken to such an arrangement. Many persons would pronounce it unfair, and bold that if one company was allowed certain privileges, another should be permitted to manufacture on the same terms. So it should be, were there no specialty in the case; but there is one. The Government by their fiscal arrangements agreed that all spirits distilled in the Colony should be admitted to consumption ou payment of a specified rate of duty ; on the faith of that arrangement, those companies entered upon the business : a bargain was as distinctly made between the country and them as between any two merchants in ordinary business transactions ; and, just as in commerce no man has a right to repudiate a contract because he finds he is likely to lose money by fulfilling it, the Colony is bound to abide by the terms of the agreement with those who accepted and fulfilled the conditions. We cannot see that injury to the revenue is a good ground of argument for altering the rate of duty so far as regards present distilleries ; although it is clearly right that the Government may say “ "We have made a bad bargain with these men, and therefore we will not enter into a similar one with anyone else.” We know nothing worse than continual tampering with Customs duties. Capitalists never know what they are doing. When the tariff was arranged under which the distillery companies invested such large sums of money, there could be no difficulty in foreseeing the consequences of their success. The slightest acquaintance with commercial principles wonld have pointed to the fact that in proportion as the consumption of Colonial spirits increased, the revenue derivable from imported spirits would decrease. That was as natural a conclusion as that four is the result of the addition of two to two. But it was held that it was better to foster Colonial industry by the imposition of differential duties than to pay for spirits the produce of foreign distilleries. We have not time to look up the other arguments on the point, but trusting to memory we may observe many prudential considerations were urged, such as superior quality of spirit, employment of labor in the cultivation of certain cereals, and so forth. Admitting these reasons to be true, so far as agriculture and labor are concerned, it follows that after all the loss to the revenue is more apparent than real: that those engaged directly or indirectly in the work contribute in other ways to swell the Treasury balance, and that therefore, although the Dr. and Cr, account of revenue derived from spirits is to the disadvantage of the Treasury, it is compensated in the increase on other items. On these grounds we can see no justification of the course proposed to be taken.

The revenue is not deficient; it is increasing, and seems likely to increase \ no one that we know of is injured by the Home manufacture, for importers know with what they have to contend, and can arrange their business accordThe whole affair has the appearance of wanton playing with capitalists, and very much resembles the very unprofitable work of building factories and knocking them down again. Possibly the Good Templars or Teetotallers may try to put moral considerations forward, and tell us that it is right to make spirits dear, in order to lessen the consumption ; but all their logic can never set aside the fact that the Government, having entered into a bargain with certain capitalists, who have fulfilled their conditions of the contract, the country is bound to abide by it, so far as they are concerned. As colonists, we are naturally anxious that our good name should be established throughout the world, and that the word “repudiation” should have no place in our national history. But “ repudiation ” need not necessarily be confined to foreign relations. It is not the less “ repudiation ” when applied to a breach of contract made by the Government with colonists, nor do we think it less detrimental to our national character. Stability should be sought in all things, for if it goes forth to the world that we encourage enterprise with one hand and ruin it with the other, capitalists will be as chary of investing money in industries in New Zealand as they would be of purchasing securities, did we ever repudiate our monetary engagements.

Permanent link to this item
Hononga pūmau ki tēnei tūemi

https://paperspast.natlib.govt.nz/newspapers/ESD18740711.2.10

Bibliographic details
Ngā taipitopito pukapuka

Evening Star, Issue 3552, 11 July 1874, Page 2

Word count
Tapeke kupu
964

The Evening Star SATURDAY, JULY 11, 1874. Evening Star, Issue 3552, 11 July 1874, Page 2

The Evening Star SATURDAY, JULY 11, 1874. Evening Star, Issue 3552, 11 July 1874, Page 2

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