Problems of the Pacific 



347 



behind it the undivided resources of the 

 whole people of New Zealand." That 

 bank stood, and that bank stands today. 

 All the business houses and manufac- 

 tories and other institutions stood, and 

 of all the places in the world the only 

 one where the panic of 1893 was never 

 able to set its foot was in the home of 

 the New Zealand" democracy. 



The necessary funds to avert this evil 

 were raised by a means so simple that 

 when you hear what it was you will feel 

 as the friends of Columbus did when 

 the}' learned from him how to make an 

 egg stand on end. 



The people of New Zealand, acting 

 in their collective capacity as a country, 

 went into the London money market, 

 and there, upon their security as a peo- 

 ple and their government bonds, they 

 borrowed fifteen millions of dollars at 

 the low rate of interest which a nation 

 of good credit can always command. 

 This money thus borrowed so easily and 

 quickly in the London money market by 

 these new-fashioned democrats was 

 brought home and loaned out to them- 

 selves as individuals at the low London 

 rate plus only a small percentage neces- 

 sary to cover the cost of the operation 

 and the risks. The rate of interest was 

 at once cut in two, and this not only for 

 the people who borrowed, but the gov : 

 eminent cut in two the usual rate of in- 

 terest and fixed the rate for the entire 

 country. 



Now, notwithstanding the losses in- 

 curred — through mistakes of the gov- 

 ernment, through fires and other losses, 

 through mistakes of single borrowers, 

 through fraud of all kinds, in principal 

 and interest — not one cent, either of that 

 borrowed by the government or the peo- 

 ple, not one dollar of principal or inter- 

 est remains unpaid. 



The government bf New Zealand did 

 more than this. Following the lines of 

 least resistance, they saw that the gov- 

 ernment of the people, being for the 

 people, as an economic concern, could be 



made as well a political concern, and 

 could become, through these powers of 

 cooperation, a factor in their daily lives. 

 They would make it a part of their eco- 

 nomic capital. The people and the gov- 

 ernment of New Zealand stand today as 

 the partners of each other in their indus- 

 tries to an extent unknown elsewhere. 

 They have established what you can 

 perhaps best understand as a sort of 

 family, or Government & Co. Unltd. 

 It investigates the secrets of various 

 kinds of production. It builds railroads 

 so as to stimulate farming industries. 

 It buys a mining patent — a cyanide pat- 

 ent, for instance — and then throws it 

 open to all the people without cost. It 

 provides facilities to the people of sell- 

 ing their produce in the foreign markets. 

 The government will inspect the butter 

 or the cheese or the meat, and if all 

 right will approve it for export. 



The government has erected large 

 warehouses, with cold storage free. So 

 far has this system been carried in South 

 Australia that the South Australian 

 farmer, desiring to market a flock of 

 sheep, drives them to the nearest rail- 

 road station. He need not follow the 

 sheep any farther. The railroad de- 

 livers the sheep to the harbor, where 

 they are left on the wharf. The gov- 

 ernment then takes these sheep and 

 transports them to the nearest port and 

 there undertakes the business of slaugh- 

 tering, especially accounting to the 

 South Australian farmer for all the 

 products, the hides, the wool, the meat, 

 etc. The products are then shipped by 

 the government to London and con- 

 signed there to the house in London 

 which represents the South Australian 

 farmer, and, to make along story short, 

 all the farmer has to do is to wait at 

 home until he receives back through the 

 post-office the government check for the 

 proceeds of the same. He does not even 

 have to wait as long as that for all his 

 money, because the government will ad- 

 vance to the South Australian farmer a 



