FEDERATION. 347 



favour to Canadian Doniinioii l)ond.s, so that tliere would probably be 

 a saviuf? in interest of about £1,00U,000 sterling, to bo rateably shared 

 by the Colonies concerned. This calculation is borno out by a state- 

 ment made by Sir Mackenzie Bowell, Premier of Canada, when in 

 Sydney in 1892, that after federation the Dominion advanced so 

 rapidly that" money was lent in the London market, nujst readily, at 

 three per cent., or about half the interest paid previously by the prcj- 

 vinces. For the information of the Committee on Finance anil 'J'axation 

 of the National Convention, an estimate was made by Mr. AVilliani 

 McMillan, M.P., that the outlay for the proposed Federal Government 

 would amount to £2,220,000, or about 1 Is. od. per inhabitant, beinj^ 

 only one-twelfth of the expenditures of the several Colonies in 1881'. 

 This approximate estimate, after revision by that Finance Com- 

 mittee shows the following items of ex])enditure : — Civil government, 

 £639,000; collection of revenue, £270,000; defence, £750,000; to 

 recoup loss on services, £200,000 ; and for interest on works taken 

 over by the Federal Government from the various Colonies, £307,000. 



The advocates for the early union of the Colonies have often urged 

 the undesirability of federating them when the enemy is at the gate, 

 or during a war panic; as the important task of constitution making- 

 should not be begun under pressure from without, but in a calm and 

 deliberate manner befitting the importance of the work. It has been 

 also urged that the task of defending Australia from attack by sea is 

 very great, as there are 8,850 miles of coastline around this island 

 continent ; and more especially so as a naval authority like Lord 

 Brassey has recently stated that " Australians should not look to the 

 Imperial navy for defence of harbours, for effective defence could 

 only be given by the action of a combined fleet and land force." 



Intercolonial freeti-ade and a common tariff would be the result of 

 a complete federal system, and the hostile Custom-houses now exist- 

 ing in Australian border towns could be entirely abolished, as in the 

 States of the American Union and in the Provinces of the Canadian 

 Dominion, in both which countries the traveller can pass across the 

 continent from province to province on railway lines over 3,000 miles 

 in length without interference of any kind by the various state 

 governments. At the present time all the Australasian Parliaments 

 levy taxes on protective principles, except that of New South Wales, 

 which has under the recent financial proposals successfully carried by 

 Mr. G. H. Reid, as Minister for Finance, adopted a freetrade tariff ; 

 and by direct taxation imposed income and land taxes so as to make 

 up the deficiency of revenue from the Customs. The present Parlia- 

 ment of New South Wales displayed a generous spirit during the last 

 session by removing at once many restrictions to commerce between 

 her and the neighbouring Colonies, without requiring any reciprocity 

 or waiting until the Federal Legislature had dealt with the fiscal 

 question. This great concession should lead to the daughter Colonies 

 emulating the good example of the mother state, by voting that the 

 federal seat of government should be carved out of her territory, 

 somewhat as she has been dismembered for them in times past. 

 The selection of the national capital at Washington was duo to a com- 

 promise entered into between Hamilton and Jefferson, and a similar 

 equitable arrangement might lead to the Federal City of Australia 



