regards loans to Australian governments. One thing is certain. The strain to which colonial governments are subjected in paying, punctually, the half-yearly interest (amounting annually to £12,000,000) on their loans is intense. And there is no doubt that this system of wanton borrowing from too-confiding British investors is directly responsible for the reckless public expenditure which has taken place-ostensibly to execute so-called "reproductive" public works, which, in many cases, are notoriously unproductive-and has been the root of all the wild speculation and financial disaster which we deplore. The large amounts of borrowed money could not be used by the governments all at once, and were placed on interest-bearing deposit in the local "associated banks" among which the government account was distributed. The banks naturally wished to make a profitable use of the government deposits while these remained in their hands-in secured loans to their customers. After the latter had borrowed as much as their ordinary business requirements could safely absorb, a large amount of government money still remained unused; and this was not unfrequently pressed on their clients by the banks, with an intimation that land would be acceptable as security for loans. This was the origin of the great land speculation of 1887-1892, which ruined many financial institutions, and brought hundreds of thousands to poverty and want; the innocent being too often involved with the guilty. The bank directors and managers do not seem to have paused to consider that, by fostering speculation in land by the granting of extensive loans, in their senseless haste to earn large dividends for their shareholders, they were forcing up land values to absurdly-inflated figures which could not be maintained, but must inevitably result in a destructive reaction, But not until the pricking of the speculative bubble had demonstrated the insanity

of their policy did they fully realise how ill-fated was the crisis they had with a light heart precipitated, Had the governments found it more difficult to obtain loans from England, the social, financial, and economic position of the colonies to-day would be sound and prosperous, and the costly monuments of public and private folly and misery with which some of them are strewed, would be happily conspicuous by their absence. If Jabez Balfour has been justly convicted of obtaining money under false pretences, and paying dividends out of capital, there are scores of bank directors in Australasia who have been not less guilty of deliberately paying dividends out of capital, and robbing their depositors.

The thunderbolt of retribution which has fallen on Australian communities has not yet, I fear, exhausted its force. It is by no means certain that all the Australasian banks which have been "reconstructed" will succeed at least for years to come-in resuming the payment of any appreciable dividend on their ordinary stocks, despite the exactions they have unjustly and cruelly imposed on their depositors in depriving them of their money, and making them compulsory preference shareholders. Whether the colonies will emerge from their trouble wiser for their trials, and be weaned from the mammon worship which they have too assiduously cultivated, remains to be seen.

Another mischief arising from this habit of extravagant colonial borrowing, is that the loans expended on public works have a marked tendency to unsettle men occupied peacefully on farms and cattle stations, and thus to create a large "tramp" population, who make a business of finding out what colonies are borrowing largely and migrating in quest of work to the new public undertakings which are carried out with loan moneys. Young men are tempted to leave their

struggling parents or employers in agricultural and pastoral settlements, and seek unwholesome excitements in populous centres in or near which the new public works are to be constructed. The consequent congestion of population in towns from this cause robs the land of much-needed cultivation, and leads to a terrific increase of poverty, an over-supply of town. labour, want of employment, distress, crime, and insanity.

I regret to see another form of mania recently taking hold of the crude public financial guides who usually find their way into the local governments and parliaments. I refer to what are called "State-banks," which are spreading through Australasia like an epidemic. New Zealand-that land of fanciful political experiments-is showing very acute symptoms of this distemper, and if these do not soon abate, fatal consequences financially can hardly fail ultimately to ensue. Victoria, New South Wales, Western Australia, and South Australia have also been badly smitten with the same malady.

SOCIAL DRAWBACKS.

There are social drawbacks in average colonial life which specially impress persons of cultured tastes and aspirations going out from this country to reside in Australia. The most striking of these among the classes moderately well off, and also among the rich in the Australian colonies, is that wealth is largely recognised as the permanent standard of worth. This vulgar test of social importance mostly prevails in young communities in which facilities for rapidly accumulating money are greatest, both at home and abroad. But in the old countries of Europe the airs assumed by the nouveaux riches are soon laughed down, because there exist side by side with them an old aristocracy and a wealthy middle class, in whose families

unaffected refinement of taste and manners has been habitual for generations. But in new countries, affording exceptional opportunities for poor men to quickly become rich, the forms in which newly-acquired fortunes are often displayed, are naturally repulsive to men and women of breeding. As Victoria has hitherto borne the palm, among the Australasian colonies, as a gold-producer, she has naturally exhibited the coarsest type of plutocracy. New South Wales and Queensland have followed her in this respect; although, as a rule, with less pronounced manifestations. Society in South Australia, in Western Australia-before gold was discovered in her territory—and in Tasmania, was more decidedly congenial to educated European tastes. But as the precious metals are being more widely obtained throughout Australasia, the standard of all-round culture and simplicity in the individual and the family are certain to deteriorate. It has been often remarked that the best University education which the colonies can supply seems powerless, up to the present, to develop that delicacy of perception, and that combined ease, dignity, and courtesy which Eton, Harrow, Oxford, and Cambridge, with their preponderance of upper and middle class teaching and associations, so successfully aid in stimulating. The collapse of the land boom has inflicted bitter and, let us hope, salutary discipline on many mushroom aspirants to social distinction in Australia. Their sole claim, in most cases, to superior rank, was their suddenly-acquired wealth, and when that was ruthlessly swept away, they speedily retreated to their original obscurity, after a short-lived and grotesque mimicry of a station in life whose actual surroundings were as foreign to them as a levee at Buckingham Palace would be to a peasant. Among these ambitious pretenders were men who had spent years in angling, by ostentatious gifts to charitable institutions, for knighthoods which are to be met with

in that part of the empire, out of all proportion to the limited population, and to the deserts of the recipients. Among successful tuft-hunters who fell in the crash were some who, in the days when they had nothing to lose, were ferocious demagogues, preaching republicanism, and setting the industrial classes against the mercantile and pastoral classes. But after having talked themselves into public notice, and eventually navigated their course into a position in one of the local ministerial cabinets, they grovelled before the Governor and his satellites for a K.C.B. or a K.C.M.G., and became sticklers for that conventional respectability which they despised when it seemed hopelessly beyond their reach. On the other hand, it need hardly be said that there is to be found in Australia a large substratum of excellent cultured and true-hearted men and women, who would adorn any station, and who are deservedly honoured in all the relations of life. But their natural modesty and self-respect cause them to shrink from the self-assertive and feelingless natures which too often force their way to the surface, and, in consequence, those who are really the salt of society have to be dug out.

One of the most incongruous institutions forming the centre of fashionable society in a practical community like that of an Australian colony, is the Viceregal Court held at Government House, and presided over by His Excellency the Governor, his family, and official retinue. The envy and jealousy engendered in ladies towards each other in reference to the style and quality of their dresses at the balls, garden parties, dinners, and other festivities to which they may be invited by viceroyalty, often threaten the peace of households. The costly tastes fostered by these gatherings, and the rivalries between families who aim at attracting supreme notice in the viceregal circle cause perpetual heart-burnings, and are responsible for