The Temuka Leader THURSDAY, OCTOBER 17, 1889. INTERCOLONIAL RECIPROCITY.

Temuka Leader, Issue 1957, 17 October 1889, Page 2

The Temuka Leader THURSDAY, OCTOBER 17, 1889. INTERCOLONIAL RECIPROCITY.

Intsbcoionial Ereetrade has excited some discussion lately, but the ablest contribution to it which we have come across was a paper read by Mr Beavan at a recent meeting of the Christchurch Industrial Association. It was undoubtedly very able, very thoughtful, and very convincing, ao.d eihibited a great amount of research and industry. As we have frequently stated, we are in favor of Ereetrade in principle and of Protection in practice, All things being equal in countries trading with each other,

there is no reason why Protection should be necessary. It is uneven conditions that render Protection desirable. Eor instance, if we were to open our ports to goods produced by the labor of the " sweaters" of Europe, the consequence would be that we never could under any circumstances develop our own industries unless we cut down wages to the sweating system level. In Germany men work from 12 to 16 hours a day (Sunday included in many instances) for about one-third of the wages men get in this colony. It is evident that men working only eight hours, and receiving three times the wages, could

not produce goods as cheaply as the Germans. It is such inequalities iu rates of wages and working hours that make all the difference, but Mr Beavan has pointed out that no such differences exist in the Australian colonies. The rates of wages and the hours of labor are much the same, and consequently there is no reason why they should not exchange goods with each other free of charge. Thoroughly in favor of Protection though we are, we find very little fault with this line of

argument, but in order to reduce such a proposal to practice it would be necessary for all the colonies to adopt Protection so far as the rest of the world is concerned. This objection has been anticipated, and answered by Mr Beavan. He says:—" Freetrade between the several colonies of Australia with a Customs union between them based on a uniform tariff against the rest of the world That is, the producers and merchants of any one colony can send their produce or goods into any of the other colonies of the group without paying any duty whatever, the Customs duties collected upon exactly the same scale of tariff payments being paid into one common fund, which is yearly divided between the several colonies in the proportion of their population." His whole scheme is summed up in this, and, if it could be adopted, it would suit very well. Where Mr Beavan is wrong is where he says that its adoption would lead to colonial Federation. Our opinion is that without Federation it would be unworkable. We cannot see how a Customs union could be worked except by a Federal Council. Of course a Board of Trade representing all the colonies could be appointed, but that in itself would be a kind of Federal Council. But even a Board of Trade would be at the mercy of the whims and fancies of local legislatures, and any one colony by refusing to acknowledge its authority would upset the whole arrangement. Colonial Federation in our opinion must precede a Customs union and intercolonial reciprocity, but that, however, does not affect the main features of the

proposal. Ia one respect we in this colony would have the best of the bargain. With the exception of Tasmania, we

import less per head of population than any of the other colonies, and, if we got our share in proportion to population of the duties collected by the Customs union, we should receive \ more than our right. Por instance, Queensland, Victoria, and New South Wales import about £2O worth of goods per head of population, while we in this colony import only about (£lO worth of goods per head. Thus »if the Protection against the world amounted to 25 per cent, the three colonies named aboye would contribute to the revenue £5 per head of population, while we in New Zealand would

contribute only £2 10s per head. If the distribution took place on the basis laid down by Mr Beavan, we should get £<k 7s 6d per head, and thus Victorians, etc., would be paying a share of our taxation. We do not suppose the other colonies would ever agree to such a proposal. The fairest way would be for each colony to collect its own revenue under the supervision of some federal authority. There is another point. To establish Freetrade with the other colonies" would result in a great loss to our revenue. How would the loss be made up? We must have revenue—we must pay our way; there is no getting out of it. How is it to be made up ? Certainly if we lessen indirect taxation we must increase direct taxation—that is, we would have to increase the property tax—and if such a proposal were brought forwaid the money-rings and monopolists would deluge the country with their tears. In this colony every man pays his share of the taxes uncomplainingly except the man who can best afford it. He whines like a whipped cur if any attempt is made to increase his burden, and screams about frightening capital away. Now he tells us that under no circumstances must the property tax be increased; then where is the revenue to come from ? Land and income taxes are

still worse, and the best authorities hold that they even would not yield sufficient for our purposes. So far as we can see, we are slaves of circumstances in these matters. We cannot do as we like, bat must cut our cloth to our measure. We must have revenue, and consequently cannot entertain colonial reciprocity, because its adoption would disorganise our finances. This appears to us to be the greatest difficulty in the way so far as we are concerned, and we doubt whether it could be easily got over. However, we do not suppose the proposal will be adopted for many years, although we really think that it would benefit all parties. Some twelve months ago we suggested to the agent of an American reaper and binder the advisability of manufacturing the machines in the colonies. He replied : "Yes; that would suit if you had Ereetrade between the colonies, but otherwise it could not be done." Without doubt if we in these colonies adopted the policy suggested in Mr Beavan's paper—that is, had Freetrade amongst ourselves and protected ourselves strongly against all the world—many of the capitalists of England and America would start factories in these colonies, and our population would increase rapidly. New Zealand, with her climate and her resources, ought to come in for more than a share of the prosperity, but we are afraid the realisation of Mr Beavan's dreams is somewhat distant, even though desirable.