GOVERNMENT LIFE ASSURANCE.

Temuka Leader, Issue 314, 6 November 1880, Page 2

GOVERNMENT LIFE ASSURANCE.

We publish the following article, which appeared jn the" Toronto Globe, on the Canadian Rational Insurance Scheme, and has been reprinted in the Review (London) of 4th August, 1880. It is interesting, as showing the opinions of Canadians on the principle of Government insurance : We have hoped that folly enough had been perpetrated during the present session of Parliament. The N.P., the rag baby, an 1 the Lettelier catastrophe ought to have been enough for one year. But with tlio most crass perversity, Mr Tilley must resurrect the National Insurance scheme, which ovorybody supposed the Government had dropped when they noted how coldly it was received. It is true that the resolutions have been withdrawn for the time boing, but the Government is committed to the scheme, and we expect its reappearance next year. There is but one plea that can be urged for the Government going ioto the business of insuring the lives of the people, and that is the greater security which it may bo supposed will attach to a Government policy. Setting aside the obvious retort that the ruling party in this country is now conquetting with a policy that leads directly lo repudiation, and that therefore the public faith is not to be relied on, it is quite plain that absolute security is not the only thing which insurers look for. If they did look for security they could find half a dozen companies already doing business in Canada, whose security is practically as good as that of any Go-A-ernment under the sun ; and therefore lie plea that Government insurance is necessary, in order to furnish security) falls to tho ground at once. But, as a matter of fact, in insurance as in everything eke, there are a host of purchasers willing to take some risk provided that the article they want can be procured cheaply. These insurers would not patronise the Government institution, for the reason, which we will preseutly demonstrate, that Government insurance must necessarily be very much dearer than that conducted by private institutions.

But we fail so see any reason, beside party reasons, why the idea should have been mooted at all. Why should Government descend from its place and take the bread from the months of the people now earning their livings from life insurance 1 What argument in favor of Governmental life insurance could be so put as not to extend to Governmental fire and marine insurance ; to Governmental manufacturing establishments; to Government stores; to Governmental everything ? Life insurance is in no sense a necessity like the carrying of the mails. Il cannot be compared in importance with the conducting of the railroads and canals which the Government do conduct, and which could not otherwise be in existence. It is not really so advisable a thing as it is that Government should control the telegraphs and railways and yet to the Government undertaking either of those businesses there are objections which counterbalance all the many advantages. vVhat nonsense it is to be mourning about the spread of socialism and communism when the Government itself stands ready to take a longer step towards socialism than any yet taken in this country. Who wants pattern parents as Sir John Tupper at the head of it?

It is not difficult of proof that the insuring of lives by the Government must necessarily be a more expensive process than the same business conducted by a private company. The Government cannot enter the market and invest its surplus at current rates of interest. All it can do is to invest its funds in its own securities, in which they will realize exactly as much as the rate of interest at which our Government can borrow in England. This rate, when the negotiation of the loan is not bungled, is about 4£ per cent. A private insurance companp, on the contrary, has the range of the globe from China to Peru before it, and can deal in any kind of security. Its funds can b« invested just as securely as our Government funds can be, and at six, seven or eight per cent, interest. And though the management of insurance companies is often wasteful, it will be contrary to all experience if the Government will not be found equal to spending a vast deal more upon the management than the most lavish of existing companies has done. It nas grown to bs a maxim that Government institutions cannot be as economically managed aa private affairs. How, then, can life insurance be profitable, when not orily will the management be more wasteful, but the income from invested funds less thau the correspondent income of a private company by at least fifty per cent, in consequence of the restricted nature of the investments 1

It is absured to suppose that the Government will do a great business should their communistic scheme go on to completion. The only case at all parallel is Gladstone's Deferred Annuities scheme, adopted shortly after the Post office Savings Banks were constituted. A more complete failure than the Deffered Annuities cannot be cited, but if the Canadian idea be not abandoned, we are afraid Mr. Gladstone will be able to point to at least one other failure more complete than his own. It must be born in mind that the insurance

business is not one in which the conduc tors have things all their own way,. People do not come rushing up with their premiums in hand begging to be insured. It is necessary to tout, and tout actively too, for business. We question if one tenth of the iusurance is made on the motion of the insured. The other nine tenths is procured by indefatigable, irrepressible, and brassy canvassers, whose pertinacity and ingenuity have become a proverb, Fancy the Government having agents of this sort scouring the country for business I Yet without them next to no business can be done.

These objections are fatal to the Govern ment plan, but grave as they are they do not amount to the weight of a feather when put alongside of another objection, namely, the demoralising effect upon the community vyhich would follow upon the possession by the Government of such power as is now sought by them. The conversion of the whole affair into a gigantic corruption machine could* hardly be avoided, even supposing that the will to prevent its so degenerating existed. We see no reason whatever to suppose that this will does exist. On the contrary, we are persuaded that the Government are initiating the insurance scheme just as they did the drawback system, with the object of fortifying themselves in office. The control of the manufacturers by means of the drawback system is calculated to secure tiie support of all who do an export trade. The control of the life insurance scheme would give the Tories a preponderating influnce wherever they chose to exert it. Fancy Dr. Tupper, for instance, running an election campaign and having this means of corruption in his power. Men whose " lives" had been refused by a reputable company would become politicans, and would seek to sell their "influence" with their "lives." They would vote only for candidates who could make heard at head-quarters their claims to " have their lives taken." There would be political doctors warranted never to detect crepitating noises in the lungs of sound Tories, and in whose ears double palpitations of the heart would go for nothing as long as the heart was in the right political place. An unsound liver, that accompaniment of high living would be at once the certificate of the possessors Toryism and his eligibility for insurance and if the brain appeared at all affected not a step further need the investigation go. " Vote for me and I'll insure you" would be the promise of Dr. Tupper, and such as he, to every elector suspected of a desire to be " seen j " give me your suffrage and I'll take your life. A material and marketable bribe would thus be given to the free and independent elector, and the beautiful thing about it would, be that the country, and not the Great Stretcher, would have to pay the money. After election there would be heart burnings worse than at present, charges recriminations, investigations of officials and insured ad nauseam. An incoming Government which found that public money had been used by its predecessors in a wrongful manner would have no resource but to make the circumstances public, and to repudiate fraudulent insurances. That done perhaps some injustice might be inflicted, and then how is it to be remedied, and how is the Government to be sued and damages recovered from it.

We do not wonder that a (Government like the present, one which was brought into existence by a fraud for the purpose of condoning a scandal, should have originated this scheme. It promises just such a mass of corruption as they would like to be dabbling in up to the elbows, it gives them the chance of fulfilling a host of unredeemed pledges to place hunters. It provides a haven for the brigades of official assignees whose heads fall with the Insolvent Act. It gives every manjack of them opportunity to provide for his s ; sters and his cousins and aunts, as well as for his brothers and his male cousins and his uncles. It means, in short the establishment of an institution which, if carried out to its logical end, will place the whole business of the country in the hands of a new Family Compact, beyond comparison meaner and more aontemptible than the dead are. If there be one atom of independence in the Tory majority they should show it now by stamping out this dangerous innovation.