The Manawatu Standard (PUBLISHED DAILY.) The Oldest Daily Newspaper on the West Coast. FRIDAY, JUNE 5, 1885. A NEW MONEY SCHEME.

Manawatu Standard, Volume X, Issue 6, 5 June 1885, Page 2

Manawatu Standard (PUBLISHED DAILY.) The Oldest Daily Newspaper on the West Coast. FRIDAY, JUNE 5, 1885. A NEW MONEY SCHEME.

i Major Atkinson, when addressing his constituents at Manaia, rcferreb to a scheme for the* borrowing of money by the Government at a low rate of interest and lending the same at an advanced rate, which had been brought ■ before the Government, and with regard to which Sir Julius Vogkl's opinion has been made known, The proposal, roughly, speaking, is to borrow m the Home' market. at 4| per cenKiat; jpar, and lend to the colony on real security with a margin of one-half or at least one third, at 5£ per cent. The speaker remarked that there is about X°30,000,000 of borrowed eapital m the colony, which tlie Government would have to be prepared to pay off m order to make 'the scheme, one of colonial importance. Granting that Government might be able to lend half that sum or at SJ, on a margin of one half (and a less margin would-be unsafe) it is impossible that those who are now mortgaged up to. the, full threefourth's of market value would be m a/^jiosition' : to ; ;jpay/;off'';tKe !; existing/ mortgage by raising a GoveranTent loan of a lesser amount. For this reason the other half of the colonists'^deb'ts ; would still remain unprovided for. Private capitalists would also be able to- lend at a ; much higher rate than ; at /present, because a large am unt of private capital would be at once withdrawn •from a colony where the individual had to complete with the Govern- 1 ment. The effect would therefore be this : those who t were able; to do with a loahof one naif oh their lands —or m other words,, the proprietors and speculators generally — \vpuld ; reap the bonefit of the cheap money, whilst the tenant would m the increased price of his money be actually paying for the cheapening of the money to the owner. 'So it would quickly assume the nature of a class increasing the facilities of the well-to-do speculator m land and of the remaining money-lenders, to double their proh'ts at the expense of the tenants. Then, again, cheapening money means, raising the price Cof land, and this way, too, favors the one at the, cost .of the other. The Hrst results following the increase m the value |of: land would be an increase m , the rents which tenants would be called upon to pay, without any corresponding improvement m the markets./or their produce. In these ways the owner gets the^dyantagey to the detriment of the tenant: - ! A'gairiv 'the tendency of bonowers is not to reduce but to increase the .amount .of . their mortgages. Hence, with' the fictitiously increased value of their land, they are . able to obtain furtlier" adviances from time to time, and still be within the prescribed margin. If is only a question involving time as to when the position will right itself. The tenant cannot pay what he does not make out of his holding. The landlord, therefore, will not hold a property which does not pay interest on borrowed capital, and sells his land for less than its fictitions value, and the lender — the Government- — loscsV Besides, if the Government were to offer- cheap money to the agriculturist, it could hardly deny it to the equally large class of merchants. The distributing class was nearly as important as the producing class, and would look, for .a share of the £ood things going. That' meant lending money for the discounting of trade bills— a system which no Government could countenance. Again, the ordinary farmer did not need to borrow money to carry, out improvements ; but to carry on his business, to buy stock, implements, or the like ; but the English system provided this security, that th" board of works only advanced money for'permanent improvements, so that they not only had 'the security of the land, ' but the land plus the added value' of improvements. For these ancl other, reasons he was satisfied that the scheme would prove a failure.