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CHAPTER SEVEN: Progress versus Arcadia 1870s-80s
The ‘Long Depression’ and German Immigration in the 1880s
During the ‘Long Depression’ or ‘Long Stagnation’ of 1879 to 1895 the British ‘paradise’ model
was put to the test as unemployment and poverty rose 1 and living standards fell, leading to
100,000 New Zealanders leaving the country between 1886 and 1891:
Rabbits had been nibbling farmers’ yields even before grain and wool prices plateaued and fell
around 1878. Then the City of Glasgow Bank failed, its woes mistakenly blamed on Australasian
pastoral investments. Nervous City of London bankers put colonists addicted to borrowing for
capital gain on starvation rations. The ‘Long Depression’ settled over the colony, lingering like a
heavy fog from 1879 until 1895. Historians debate its severity but not that it strangled growth in a
colony until then sheltered from global recession by state borrowing; nor that it radicalised the
migrants of the 1860s and 1870s. The south felt the chill first. In a reversal of the gold-rushes,
thousands fled Otago and Canterbury for prosperous Victoria; many who stayed put preferred to
invest their money there. […] For a while Auckland, always more in step with the still-healthier
Australian economy, rolled along on a speculative boom. […] In 1880’s bubble economy skilled
labour was scarce. They said that there ‘was not a man without work, unless he be infirm,
dissolute, or lazy’. Then came the reckoning. In 1885 and ’86 Auckland’s economy crashed fast
and hard. The Northern Steamship Company reported a loss and the National Bank wrote off
£100,000 of capital, beginning ‘a 10-year banking crisis which affected the whole colony’. […]
The capitalists’ credibility crashed along with their fortunes. Credit tightened, loans were called in
and businesses once thought solid closed their doors. 2
The times became so desperate that some employers even resorted to ‘Old World evils’, such as
exploiting female and child labour, lowering wages, lengthening and altering the hours of work,
and subjecting the workers to overcrowded and unhygienic conditions. 3
In 1881 an article by Auckland-based German correspondent Georg Zürn 4 entitled “Neu-
Seeland als Auswanderungsziel und Exportgebiet” appeared in Export, 5 a journal concerned with
German-speaking Europe’s commercial interests abroad, in which he reports the downfalls of
1 11,444 individuals alone filed for bankruptcy in the 1880s, on top of a further 4,000 in 1877-79, a sum equivalent to
about 100,000 in today’s reckoning (Belich, Paradise Reforged, 32-38).
2 Gavin McLean, “God’s Own Country, 1878-1913”, in: Frontier of Dreams, 186f.
3 Judith Bassett, “Dark Satanic Mills 1880-1890”, in: People and the Land, esp. 187-94; McLean, “God’s Own
Country, 1878-1913”, 188f.; Matthew Wright, Reed Illustrated History of New Zealand. Auckland: Reed, 2004, 188-
94.
4 Originally from Saxony, Zürn was a “Premierlieutenant” and “Regimentsadjutant” who left the army in order to
travel. After visiting Africa and Australia, he spent his last three years in New Zealand, became well-known in
Auckland and made many friends. However, in May 1882 at the age of 34 he went missing in the Coromandel: “An
educated man, master of five languages, and a gentleman in every sense of the word – if lost he will be deeply
mourned by all who knew him” (“The Search for Lieutenant Zurn”, in: NZH 15 May (1882): 6; “Australien und
Südsee”, in: Export 4:27 (1882): 409f.).
5 Georg Zürn, “Neu-Seeland als Auswanderungsziel und Exportgebiet”, in: Export 3:31 (1881): 450-52; 3:32 (1881):
465f.; 3:33 (1881): 481-83; 3:34 (1881): 494f.; 3:35 (1881): 505f.
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