480 AGRICULTURAL CREDIT.—DAVIDSON. 
his indebtedness, and when it finds itself making a profit out of 
the business, instead of accumulating a fortune, gives him the 
benefit by reducing his rate.” 
New Zealand charges interest at the rate of 5 per cent., and 
up till 1900 had made about 7000 loans, amounting to more than 
ten million dollars, and it is claimed that not a cent has been 
lost, and that in 1900 there was not a penny of interest or prin- 
cipal due which had not been collected. The entrance of the 
government into the business of lending money, brought rates 
down all over the country, and not only those who borrowed 
from the government, but all borrowers, had the benefit of a 
reduction in the rate of interest of something like two per cent: 
One supporter of the New Zealand government claimed that “ the 
action of the state in entering the money-market has made an 
average reduction of 2 per cent. on £32,000,000 of landed 
indebtedness, and £32,000,000 of other debts.” The benefit may 
not have been as great as this and yet have been very great in 
its immediate effects. 
The state advances money to the Australasian farmer at 
both ends. It advances money on his farm, and then lends him 
money on its produce and helps him to market it at the best 
terms. With this latter activity of the state on behalf of the 
farmer we are more familiar in Canada. Neither Dominion nor 
provincial governments have yet found it necessary or advisable 
to lend its credit to its farmers. Ontario is a slight exception, 
that province, I believe, making slight advances for purposes of 
drainage. But the Department of Agriculture, with all its mani- 
fold paternal activity on behalf of the farmer, has not advanced 
money for improvement or for cultivation—at least to the native 
farmer. To some classes of immigrants small advances have been 
made by another department. The Mennonites received a loan 
of nearly $100,000, which has all been repaid with interest ; the 
early Icelandic settlements received some $30,000, which, owing 
to adverse circumstances in the settlement, had to be written off 
as a bad debt, the security being destroyed by disastrous floods ; 
and similar small advances have been made to the Dcukhobors 
