Counties with thirsts which would drink up an ocean;
These be the horse-leech's children which cry,
'Wanted, Expenditure!' I must supply."
—The Premier's Puzzle.
Sir George Grey had been curtly recalled in the early part of 1868. His friends may fairly claim that at the time of his departure the Colony was at peace, and that he left it bearing with him the general esteem of the colonists. True, his second term of office had been in some ways the antithesis of his first. He had failed to prevent war, and had made mistakes. But from amid a chaos of confusion and recrimination, four things stand out clearly: (1) he came upon the scene too late; (2) he worked earnestly for peace for two years; (3) the part that he personally took in the war was strikingly successful; (4) he was scurvily treated by the Colonial Office.
He was the last Viceroy who took an active and distinct share in the government of the country. Since 1868, the Governors have been strictly constitutional representatives of a constitutional Sovereign. They have been without exception honourable and courteous noblemen or gentlemen. They have almost always left the Colony with the good wishes of all with whom they have come into contact. They have occasionally by tact exercised a good deal of indirect influence over some of their Ministers. They have sometimes differed with these about such points as nominations to the Upper House, or have now and then reserved bills for the consideration of the Home Government. But they have not governed the country, which, since 1868, has enjoyed as complete self-government as the constitution broadly interpreted can permit.
When peace at last gave the Colonists time to look round, the constitution which Grey and Wakefield had helped to draw up was still working. Not without friction, however. Under the provincial system New Zealand was rather a federation of small settlements than a unified colony. This was in accord with natural conditions, and with certain amendments the system might have worked exceedingly well. But no real attempt was ever made to amend it. Its vices were chiefly financial. The inequalities and jealousies caused by the rich landed estate of the southern provinces bred ill-feeling all round. The irregular grants doled out by the Treasurer to the needier localities embarrassed the giver without satisfying the recipients. The provinces without land revenue looked with hungry eyes at those which had it. There was quarrelling, too, within each little provincial circle. The elective superintendents were wont to make large promises and shadow forth policies at the hustings. Then when elected they often found these views by no means in accord with those of their council and their executive. Yet, but for one great blunder, the provinces should and probably would have existed now.
1870 is usually named as the birth-year of the colonial policy of borrowing and public works. This is not strictly true. In that year the central and provincial exchequers already owed about seven millions and a quarter between them. The provincial debts, at any rate, had been largely contracted in carrying out colonizing work, and some of that work had been exceedingly well done, especially in Canterbury and Otago. What the Central Government did do in 1870 was to come forward boldly with a large and continuous policy of public works and immigration based on borrowed money. The scheme was Sir Julius Vogel's. As a politician this gentleman may not unfairly be defined as an imaginative materialist and an Imperialist of the school of which Cecil Rhodes is the best-known colonial exponent. His grasp of finance, sanguine, kindly nature, quick constructive faculty, and peculiarly persuasive manner rapidly brought him to the front in New Zealand, in the face of personal and racial prejudice. As Treasurer in 1870 he proposed to borrow ten millions to be expended on railways, roads, land purchase, immigration, and land settlement. With great wisdom he suggested that the cost of the railways should be recouped from a public estate created out of the crown lands through which they might pass. With striking unwisdom the Provincialists defeated the proposal. This selfish mistake enabled them to keep their land for five years longer, but it spoilt the public works policy and converted Vogel from the friend into the enemy of the Provinces.
His policy, minus the essential part relating to land settlement, was accepted and actively carried out. Millions were borrowed, hundreds of miles of railways and roads were made, immigrants were imported by the State or poured in of their own accord. Moreover, the price of wool had risen, and wheat, too, sometimes yielded enormous profits. Farmers were known who bought open land on the downs or plains of the South Island at £2 an acre, and within twelve months thereafter made a net profit of £5 an acre from their first wheat crop. Labour-saving machinery from the United States came in to embolden the growers of cereals; the export of wheat rose to millions of bushels; and the droning hum of the steam threshing-machine and the whir of the reaper-and-binder began to be heard in a thousand fields from northern Canterbury to Southland. In the north McLean steadfastly kept the peace, and the Colony bade fair to become rich by leaps and bounds. The modern community has perhaps yet to be found which can bear sudden prosperity coolly. New Zealand in the seventies certainly did not. Good prices and the rapid opening up of the country raised the value of land. Acute men quickly bought fertile or well-situated blocks and sold them at an attractive profit. So men less acute began to buy pieces less fertile and not so well situated. Pastoral tenants pushed on the process of turning their leaseholds into freeholds. So rapid did the buying become that it grew to be a feverish rush of men all anxious to secure some land before it had all gone. Of course much of this buying was speculative, and much was done with borrowed money. The fever was hottest in Canterbury, where the Wakefield system of free selection without limit as to area or condition as to occupation, and with the fixed price of £2 an acre, interposed less than no check at all to the speculators. Hundreds of thousands of acres were bought each year. The revenue of the Provincial Council rose to half a million; the country road-boards hardly knew how to spend their money. Speculation, extravagance, reaction—such were the fruits the last years of Wakefield's system bore there. Not that the fault was Gibbon Wakefield's. It rests with the men who could not see that his system, like every other devised for a special purpose, wanted to be gradually changed along with the gradual change of surrounding circumstances.
The southern land revenue, thus swollen, was a glittering temptation to politicians at Wellington. As early as 1874 it was clear that more colonial revenue would be wanted to pay the interest on the growing public debt. Vogel decided to appeal to the old Centralist party and overthrow the Provinces. Their hour was come. The pastoral tenants nearly everywhere disliked the democratic note growing louder in some of them. New settlers were overspreading the country, and to the new settlers the Provincial Councils seemed cumbrous and needless. Fresh from Great Britain and with the ordinary British contempt for the institutions of a small community, they thought it ridiculous that a colony with less than half a million of people should want nine Governments in addition to its central authority. The procedure of the Provincial Councils, where Mr. Speaker took the chair daily and a mace was gravely laid on the table by the clerk, seemed a Lilliputian burlesque of the great Mother of Parliaments at Westminster.