Wakefield's LETTER FROM SYDNEY - His theory of colonization - The Colonial Office and Wakefield's Principle - Act to establish South Australia - Colonists at Kangaroo Island - Colonel Light selects site of Adelaide - Recall of Governor Hindmarsh - Gawler's governorship - Grey appointed Governor - His reforms.

The failure of Thomas Peel's Swan River experiment occurred at a time when much interest was being taken in England in systematic colonization. The Revolutionary and Napoleonic wars had thrown Europe into disorder for a quarter of a century, and parallel with them went the creation of the great change in conditions of manufacture which is known as the industrial revolution. The new system, while it made employers rich, plunged the mass of the working classes into deep poverty. Pauperism was 'breaking down the country,' though the total wealth of England was increasing enormously. Wages were miserably low, food was dear, and there was not sufficient employment to absorb the thousands who saw their old hand-industries rapidly disappearing in consequence of the application of steam-driven machinery to production. Emigration was advocated as a remedy for these painfully manifest ills. England was believed to be over-populated. But she had vast empty possessions oversea. These could be used to relieve the pressure at home. But there was a desire to use them in a systematic, scientific manner. The time was ripe for some one to show how this was to be done.

The man who came forward with the most convincing plan was Edward Gibbon Wakefield. This ingenious and persuasive writer (who had spent some time in Newgate prison, whither he had been consigned for marrying a ward in chancery), published in 1829 a little book called A LETTER FROM SYDNEY, which immediately captivated the minds of many politicians and officials who were searching about for a rational theory of colonization. It was. written in so attractive and vivid a style that not only contemporaries, but some later historians also, thought that it proceeded hot from the personal experience of one who had studied Australian conditions on the spot. Thus, Sir Spencer Walpole, in his HISTORY OF ENGLAND (vol. vi., p. 360), stated that 'the letter was written from Sydney.' But, in fact, Wakefield had never been to Sydney, nor to any other colony. He wrote his little book in London; but he was so plausible, and he put into it so many cunning and racy little. touches, that he made people believe that he was describing what he had observed.

Wakefield followed up his success by writing numerous articles and letters in public journals, and by discussing his ideas with prominent men, until quite a large party was formed which believed in him as the genius who had at last given to the world the true and only plan of founding and working a colony on sound lines. The Wakefield Principle was always mentioned by some journals with the reverential homage of a capital letter, and there were advocates of it who, as a distinguished critic said, regarded it as 'the one thing needful to make mankind rich, virtuous, and happy for the rest of their time on earth, a specific for all the disorders of the world.'

Now, the Wakefield Principle was the very opposite of the plan which Thomas Peel had endeavoured to carry out in his Western Australian colony; and, as the news of that failure was being much discussed in the very year when the LETTER FROM SYDNEY was published, Wakefield and his supporters were able to stress the virtues of their own theory by reference to the obvious defects of others. Peel had sought to attract settlers by the offer of an abundance of cheap land. The very essence of Wakefield's system was that land in a new colony should never be sold cheaply, but always at a 'sufficient price.'

Wakefield developed his ideas in a number of books and minor publications, but they may be explained in simple terms as follows. A colony depends upon three main elements for success land upon which to settle, capital to apply to the land, and labour to work it. If land in a new colony is obtainable very cheaply, he argued, labourers will not continue to work for settlers; for they will soon save enough money to buy land of their own. Consequently, there will be no dependable supply of labour. But a colony cannot prosper unless there is an abundance of labour. Settlers with capital will not come out unless they can get labour to work their properties. Therefore you require two things: first, a fund by means of which you can bring to your colony labour from the mother-country, where there is an excess of it; and, secondly, a means of keeping them in the position of labourers when you get them to the colony. If, then, you sell your colonial lands, not very cheaply, as was done at the Swan River, but at a 'sufficient price' to enable you with the proceeds of the sales to bring out all the labour which the colonists require, and if you devote the entire proceeds of your land sales to this purpose, you will maintain an exact balance between the land you desire to have occupied, the capital necessary to develop it, and the labour required to work it. Your labourers will have to remain labourers for two or three years, because the savings from their wages will not be sufficient to enable them to buy land of their own until they get enough to pay the 'sufficient price '; and the 'sufficient price' obtained for the land will enable you to maintain a constant supply of fresh labour from the overflowing reservoir of Europe provided (and this was an essential feature of Wakefield's system) that you do not use the proceeds of land sales for any other purpose than paying for immigration.