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"Where wages are highest, there will be the

largest production and the most equitable distribution of wealth. There will invention be There will be the greatest comfort, the widest diffusion of knowledge, the purest morals, and the truest_patriotism."-HENRY GEORGE (Protection or Freetrade).

most active, and the brain guide best the hand.

JANUARY 1ST, 1895.

The Land Value Tax Bill has emerged from the Legislative Assembly in such a mutilated state that all real land taxers would witness its decease with a considerable amount of equanimity. Their loyalty had already been stretched in swallowing the futile attempt to tax mortgagees, an attempt which, however successful it might be for the term of current mortgages, must fail as soon as any of these terminate. But from the first they declared that the tax should fall on the value of all land or none, and now, when land in town and country is exempted to the extent of £500, they take little further interest in a tax which is based on no principle, which,

very principle on which it has been advocated.

The key-note of the speech with which Mr. Turner introduced the tax to the House, as well as that of all the speakers who supported him, was, that the unimproved value of the land arises not from the labour of its owners, but from the labour and necessities of the community as a whole, and from the services of the Government; that, therefore, the value of land is justly liable to special taxation as a small return to the community for the special service rendered to the owners of the land. Every supporter of the tax used this argument in its vindication. Yet, if this argument is true, and it is supremely true, then it applies as much to the smallest and least valuable, as to the most valuable plot of land. All the land which has a value, apart from its improvements, owes that value to the services of the community, and to exempt any land therefore runs counter to the principles on which a special land tax is founded. If any owner of land having any unimproved value is exempted, the taxation of any other land owner is no longer an act of justice, but the mere exercise of power, in no way distinguished from the existing systems of taxation.

It would have been still worse if Mr. Longmore's suggestion of a graduated tax had been adopted. The member for Dandenong is like the Bourbons; he has returned to the House without having learned any thing or forgotten anything. He is still the same Longmore who introduced the existing land tax, a tax conceived in revenge and carried out

The same sentiments impel him now to propose a graduated land tax. It is fortunate that the Assembly is not actuated by this spirit, otherwise the day of reform in the iniquitous systems of taxation which now oppress the country would be far distant. The men who have fought so long for that reform would be compelled to resist such an unjust proposal with all their strength.

While, however, they are determined that their great principle shall not be degraded to such base uses, they can tolerate the tax as it stands at present for prudential reasons. One of these is that the assessments will furnish them with the necessary proofs to silence once and for ever the cry that a tax on land values will fall heavily on the farming community. Though the land tax registers of both New Zealand and South Australia amply vindicate the statement that farmers will pay less under this system than under any other; though this statement is fully supported by the estimates of our own and of the New South Wales Statist, the contrary doctrine is still being preached by the Conservatives. Actual proof alone can silence this interested opposition, and such proof will be amply available if

the tax comes into force.

Moreover, even as the tax stands now, it will levy the necessary revenue with less injury to the people, than if it had been raised in a wealth tax, or in additional Customs duties, or in any other way. This is a consideration of the utmost moment, especially at the present time. Though it is greatly to be regretted that the tax has brought no such relief to the

WORLD.

farmers and working classes as Mr. Irvine tried to secure for them, yet it raises additional revenue without burdening them any further. It is not the best tax, but it is a better tax than any other on our Statute Book, and however illogical and ineffective the exemptions may be, and though they prevent any social advantages arising from the tax, the reformers can accept it, though they cannot greet it with any enthusiasm.

The next question is, what will the Legislative Council do with it? Will our lords pass it? Will they amend it, or will they reject it? The plain invitation, addressed by them to the large land-holders, to bombard the Council with petitions against the tax, seems to indicate a desire to strangle it forthwith. On the other hand, the action of Sir Frederick Sargood and of Mr. Pratt points to a desire of vindicating the right, claimed for the Council, of amending money Bills in what the Council itself pleases to consider their machinery clauses. These gentlemen may argue thus: This Bill is unpopular with a large section of our supporters. They may be more will ing to condone an invasion of the constitutional rights of the Assembly, where the result will save them some money, than on other occasions; therefore we ought not to let this opportunity pass without an attempt to establish a precedent which will give us the paramount power in the country.

We say they may reason in this manner, though we are confident that they will reckon without their host. The people of Victoria are not so degraded as to sell their birthright for a mess of pottage. We are confident that even the majority of the landowners will refuse to establish the despotism of the Upper House for a bribe. On this score we have no fear, and if the times were not so serious we would welcome a struggle which would put an end, once for all, to the despotic aspirations of what is in reality an absolutely unrepresentative assembly.

If, however, the Upper House merely exercises its right to throw out the Land and Income Tax Bill, an appeal to the country will be made, with much smaller chances of success. The Government, in refusing to couple its Bill with any reduction either of Customs duties or railway freights, and by consenting to exemptions, has sacrificed the enthusiasm which would

otherwise have beaten down all obstacles. As it is, the people will be lukewarm while the interested monopolists will fight for their pockets. The former cannot easily see that they gain by the Bill, while the latter are sure that they will lose by it. Under such circumstances victory is at least doubtful, and may be impossible.

Yet it seems to us that the Government still possesses the opportunity of making victory certain. Mr. Turner's statement is that the exemption of £500 deprives the revenue of £160,000 a year. If, then, the Upper House throws out the Bill, he can bring in a new one, granting no exemptions, but substituting for the same the abolition of the late increase in sugar duties as well as a clause, that £80,000 of the revenue from the land tax shall be applied to the reduction of railway freights on agricultural produce. Such a concession would cost him nothing, for it would merely absorb the amount gained by the removal of exemptions. But inasmuch as these concessions would place £3 and more into the farmers' pockets for every £1 which the land tax would take out of them, neither the Assembly nor the Council are likely to refuse their assent. Either an appeal to the country would be avoided, or it would be fought with the certainty of success.

The prediction upon which we ventured in August, that the Democratic party in the United States would be overwhelmed by public indignation, has been fully justified by the result of the November elections. It is not a defeat, but annihilation which has been inflicted on them. As far as the Northern States are concerned, the party has only saved a few representatives from the general wreck, and is represented in Congress almost entirely by deputies from the southern States. Two years ago the people of the United States elected a Congress consisting of 219 Democrats, and only 126 Republicans. The next Congress will consist of 240 Republicans and of only 107 Democrats.

Even the Single Taxers have been involved in the general ruin, and have to deplore the defeat of Tom L. Johnson, J. Simpson, and others.

This revulsion of public feeling is too complete to permit of its being attributed to popular caprice. Nothing but deep-seated indignation and utter disgust can account for it, and flagrant

misconduct alone can have roused these feelings. As a warning to our own politicans, especially to the Free Trade party in New South Wales, which, in one direction, seems to adopt a similar course to that which wrecked the Democratic party in the States, the history of the second Cleveland administration is of the utmost interest.

In 1892 the people of the United States elected a Democratic President, a Democratic Congress, and gave a small majority to the Democrats in the Senate. The elections had turned entirely on the fiscal issue; Democrats and Republicans alike admitted that the bold declaration of the younger Democrats in favour of Free Trade had decided the issue. The mandate of the country therefore was clear and unmistakable, and it was the plain duty of the Congress to give it effect. Unfortunately, however, dissensions rent the Democratic party. The party machine, led by Governor Hill, of New York, had made no secret of its Protectionist proclivities, and had done its utmost to defeat the election of Cleveland to the Presidency. Another section, mainly consisting of the old and discredited boodlers in the party, and led by Senator Gorman, had no desire for any reforms which might diminish the gains of the protected "Trusts with which they were as much allied as the Republican managers. The resulting intrigues and difficulties seem to have clouded Cleveland's judgment, and he eagerly availed himself of the first excuse which presented itself for shelving the fiscal issue for a time.

This excuse was found in the silver question. The Eastern Republicans had log-rolled with the representatives of the silver states, and, in order to secure their vote for the protected manufacturers, Government to purchase all the silver had pledged the offered to it at a price far exceeding its market value. As a consequence, gold was rapidly leaving the country, the currency was in a state of disorganisation, and the financial outlook most threatening. Cleveland resolved to call a special session of Congress in 1893 to deal with this question, and to delay the reform of the tariff till 1894. He forgot that an expected revision of the tariff in a Free Trade direction necessarily imposes the greatest caution on manufacturers and traders until they know the exact nature of the changes, and can guide their operations accordingly. As a