THE NATIONAL DEBT.

Southland Times, Volume 2, Issue 33, 18 May 1863, Page 5 (Supplement)

THE NATIONAL DEBT.

(From the Canterbury Press, 7th April.)

Can any one tell us how much New Zealand owes at the present moment ? We could not ourselves, without considerable trouble and tedious reference to past records, make up the correct total ; but it requires only a general acquaintance with the history of the colony, to arrive at a result not very wide of the truth.

First, then, the General Government borrowed L500,000 in 1857; a loan of L150,000 was taken up for war purposes in iB6O, or 1661 ; and last session a further loan of half a million was sanctioned.

Auckland has several small loans outstanding, both on account of the Provincial Government, and of the City and Harbor authorities. She has now cast aside the petty schemes of former years, and goes in for half-a-million. Taranaki has been prudent, whether from compulsion or choice we need not enquire, but we believe she has no debt except nominal ones to the General chest. Hawke's Bay is hardly out of its teens yet ; no doubt it will make up for the lost time some day. Wellington has not borrowed largely. We do not know the exact amount of the debt, but shall put it down at about L50.000. Nelson owes but little, and Marlborough goes in for duplicity of Superintendents instead of loans.'Canterbury, boldly leading the van, is vn for L780,000, Ofcago for something over L550,000, and Southland for LI 50,000.

It will be no exaggeration to say that the colony of New Zealand has borrowed, or is in the act of borrowing, or has determined to borrow, three millions and a half of money.

The debt of the Northern States must be about L200,000,00?, or at the rate of about LIQ a head of the population.

The debt of Great Britain is about L800,000,000, or at the rate of between L26 and L27 a head of the population. ,

The debt of New Zealand is about L3, 500. 000, or, supposing the population to be about 150,000, which is not very far wrong — at the rate of L35 a head of the population. So that at the present moment the New Zealand National Debt is nearly 30 per cent, greater in proportion to the population than the National Debt of Great Britain. This is a somewhat startling announcement. Of course there are many circumstances in which the comparison does not hold good, which we shall refer to. But the fact that our debt has already reached the enormous sum of three millions and a-half, is one which we undertake to say will come upon the majority of our readers as a revelation for which they were not by any means prepared. It will be said in the first place, that the population is rapidly increasing, whilst the debt will be stationary, and soon will be very small in proportion to the wealth of the country. But we should be glad to know by what authority we monopolise to ourselves the right to borrowing in one generation only. If our theory of borrowing be correct, why should not the next financial generation " better the instruction."

Again, ifc will be said, we are borrowing on the security of our waste lands. A country like England borrows upon the taxable capability of the country, but we have the enormous public estate of the waste lands to fall back on. Is this true ? Are we borrowing on the security of waste lands? We borrow when we have so many acres of waste lands to sell ; we sell them, and spend the money, not in liquidating the debt, but in other matters. How can it be said we borrow on the security of the waste lands when we make away with the security without paying the debt?

Lastly, it will he said we borrow for remunerative objects. Ah ! that is indeed the whole question. America is borrowing solely for the purposes of destruction. Every dollar's worth is simply destroyed, and produces nothing. So it was with the English debt. The money was poured out like water on foreign .armies, and military and naval expeditions, which left nothing of a pecuniary or economical result behind them. The debt was left, but not one p^nny of income to meet the interest on the debt. That had and has all to be raised annually out of the people by taxation.

Now perhaps our readers will appreciate what we have always been so strongly urging as to the extreme folly of borrowing for purposes which are not remunerative. The English railways have cost three hundred and fifty millions : a sum equal to nearly half the national debt has been raised over again in twenty-five years, and invested in railways. Has this pressed on the energies of the country. Not a morsel. On the contrary, it has expanded our resources. Why ? Because the railways pay. They do not indeed pay as good an income as they might have done under a better system ; but they do pay interest on capital, even now, on the whole.

Let us apply tin's to our own case. If this enormous debt which we have incurred be expended so as to provide and create the interest, and the sinking fund which shall secure its extinction, well and fjoodf It is quite impossible to borrow too much under such conditions But if nof, if this money be wasted, as there is* always too much temptation <o waste borrowed money, it will constitute a burden which will weifh I'ke a mill-stone on the neck of the colony. The day will come when the interest must be paid by taxes. And remember that a great part of this debt already incurred has been for that for which we shall never see any return. The first half million loan was raised to pay off the old New Zealand Company's debt, and the debts of the first war. The LiSO.OoO loan was wholly for war purposes. Out of the Provincial Loans how many will provide their own interest ?

Tt is a very serious question ; and if; is a still more serious question now that Sir Georare Grey has selected to treat the instructions of the Colonial Office with the same unmitigated contempt which distinguished hia career at the Cape, and to sanction every loan raised by a province in spite of the direct anrl -positive instructions of the Colonial Office to disallow it.