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SIR RICHARD GRAVES MACDONNELL'S despatch (No. 439) of the 30th of last January, as follows:-
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"Your Grace however is sufficiently aware that this Government has not "been swayed by any desire of gain. On the contrary, I have never written a despatch in which I have not regretted that a policy justified by necessity "should be encumbered with any pecuniary gain, because the latter affords to opponents of that policy an opportunity to impute to myself and my Council "motives the reverse of those by which we are animated. If mere addition of "Revenue had been our object, I should not have accepted $252,000 as the *Annual License Fee instead of upwards of $360,000 which was actually offered, nor would I have gradually reduced the original $260,000 to $204,000 at which "it stands during the present month.”
8. The above plain statement completely disproves the assertion of the Com- mittee, that since 1866, the Licenses "had been put up to sale and granted to the highest bidder," and I am now further instructed to add, that not merely had $360,000 been declined, but that by consecutive reductions the License Fees had been lowered till a few weeks back they reached only $156,000.
9. Even that reduction was less than His Excellency had hoped to effect, for as more fully explained in his recent financial statement to the Legislative Council, an extract from which is appended hereto, he was prepared (Par. 19) to make any reduction necessary to compensate the Licensees for excluding all but Chinese from the Play Houses-a reform now most effectually carried out.
10. Reasons alluded to in the accompanying Appendix (Page 7, Par“. 19 and 20), and more fully explained in the Governor's communications to the Secretary of State, have produced for the moment the unexpected result of an increase of License Fees just as the frequenters of the Licensed Houses were diminished.
II. It is perhaps superfluous now to accumulate further evidence of the inac- curacy into which the Social Science Committee have fallen as to a matter of fact, when they represented this Government as selling the License Monopoly to "the highest bidder." The Governor however wishes to record at the same time his conviction of the excellent objects of the Committee and of the general body which they represent. He attributes to them nothing more than an inadvertent although indefensible mistake. It is, however, unfortunate that it occurred in reference to the very point on which it was most important that there should be no misrepresentation; and it cannot be doubted that this will be a source of regret to the Committee, especially when they learn that at the very last meeting of the Legislative Council (vide Appendix, Page 8) His Excellency distinctly refused to accept the suggestion of a leading unofficial Member of that body and use the License Fees for the purpose of diminishing the local taxation of the Colony.
12. The personal feelings and sympathies of His Excellency are entirely with the Committee, and had he never visited China, nor been compelled by his duty to this Community to deal on the spot with the unquestioned and real evils arising from the inordinate love of Gambling of the native population here, and the absolute necessity for permitting, under regulated and comparatively safe conditions, a vent for a vice, whose existence under worse conditions would have been the only result of Government inaction, it is very probable that, as a Member of the Social Science Association, he might have subscribed, and applauded himself for subscribing a remonstrance of the kind addressed by the Committee to the Secretary of State.
13. It is also quite possible under such circumstances that, like the Committee, he might have regarded the policy pursued at Heligoland, Baden, and here, as identical. Gambling, he might have reflected, is permitted at all those places,
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a revenue results therefrom in each. Such a policy is indefensible at Baden and Heligoland, where unnecessarily and for the sake of money it encourages a vice. which might otherwise die out or at least decline. Therefore he might perhaps have argued it is equally indefensible at Hongkong. Nevertheless no one here would pretend that there is the remotest chance of the vice of Gambling being diminished by suppression of the Licensed Houses, as would be the case at Baden. It would simply become indefinitely more extended than now. If it were not legalised so completely as to require no Police interference, however little, there would inevitably be Police corruption and consequent insecurity to the Community. Unless therefore it be contended that similar consequences would follow the abolition of the Monopoly at Heligoland there is no parallel between the two cases.
14. Again, only natives, who are practically beyond the reach of Government in such a matter, are here allowed to enter the Licensed Houses, and unless it be shown that Europeans are similarly excluded at Heligoland and that Gaming is only permitted there to an overwhelming majority of Orientals, or strangers coming and going in numbers exceeding 600,000 every year, and that is only allowed because they cannot otherwise be efficiently reached by the Police. no parallel is established between that place and Hongkong.
15. Finally, to complete such parallel, it would be further necessary to show that the Authorities at Heligoland had been exerting themselves as here from the first to keep down any Revenue accruing from the Licenses beyond the amount necessary to work the system as a strictly Police measure, a motive which it is not pretended to adduce in favor of licensing Gaming in Europe.
16. It may therefore be as well to speak frankly, and declare at once that the only argument in the Memorial of the Committee which seems to His Excellency deserving notice, is their suggestion (Par. 9) that the Authorities here have not as yet so exhausted the direct means at their disposal for the suppression of Gambling as to justify a departure from the general principles of penal juris- prudence elsewhere. In illustration of this, the Committee state that the Chinese laws and the local Ordinances against Gambling had never been fairly put in execution, and especially that the Ordinance for improving the Chinese law of the Tithings, Hundreds and Frank pledges, which in China had always been found quite sufficient for the entire suppression of the practice, had never been put in force at all.
17. It is difficult to imagine where the Committee got their information as to the entire Suppression of Gambling in Chinese Cities by laws establishing Tithings and Hundreds, &c. Gambling has been now and then stopped in a particular place for a short time by high officials, who were guided sometimes by upright and sometimes by corrupt motives, such as that of raising the toll on an illegal luxury. This however has been done by extreme severity such as razing houses to the ground and torturing the landlords, measures to which it is true this Government has never yet resorted. It is however totally without foundation to assert that Gaming does not prevail most extensively and publicly in every city of the Empire, although nominally the law forbids it. This subject however has been sufficiently alluded to in the Governor's despatch of the 30th January last, (Pars. 3, 4 and 5) which the Committee had before them when advancing the above extraordinary
assertion,
18. At this moment the Police system inaugurated by Ilis Excellency amongst the Chinese,- --an institution quite apart from that of the Colony-is working ad- mirably, but the last thing which a resident here could dream of would be the handing over to any Chinese, whether in Tithings, Hundreds or otherwise than as parties directly and openly interested therein like the Licensees, the slightest control
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