Page:The Present State and Prospects of the Port Phillip District of New South Wales.djvu/120

 from the supply of cheap labour, under the transportation system, had, conjointly with the advanced price of wool, created a high degree of prosperity. A spirit of enterprise extended itself through the colony, and its waste lands were eagerly purchased at the government sales. The result of this speculative disposition was, that enormous accumulations of money in the government treasury were effected. The sums thus realized to the public credit were subsequently deposited in the several colonial banks, and an interest on these deposits was exacted by the government successively at rates of four, five, and seven per cent. The banks were under the necessity of extending their discounting transactions in a corresponding degree, thus keeping alive an inordinate and unjustifiable spirit of speculation throughout the community. The sudden expenditure of the whole accumulation which had been made from the land sales in immigration, and the immediate curtailment of discounts by the banks upon the withdrawal of the government deposits, have produced a degree of exhaustion which has more than equalled the previous excitement.

"Simultaneously with the occurrences above enumerated, and tending to aggravate their unfortunate influence, was the measure of her majesty's government for raising the upset price of land from five shillings to twelve shillings, and subsequently from twelve shillings to twenty shillings an acre. The adoption of this scale of augmented upset prices has been a complete annihilation of the land fund; neither the profits of sheep farming nor agriculture can ever justify the investment of capital in land at these prices; nor do your committee believe that any capitalists will ever be induced to emigrate from the mother country whilst such a system regulating land sales is in force."