So far we have had to deal only with the difficulties encountered by the young colony and the steps taken to combat them. It is too soon to speak of the consequences that were entailed by forming a new settlement from the dregs of society. I will only state in general terms what was the actual state of affairs. A governor at the head of all with full powers nominally, but not nearly autocratic; next to him, as the aristocracy, a band of officials not always obedient, sometimes openly insubordinate, consistent only in pushing forward their own fortunes. Between these and the general body of the colonists a great gulf; the nearest to the aristocracy being the settlers--passing through several gradations--from the better class, few in number, to the pensioner or convict newly set free; at the very bottom, the slave or serf population--the convicts still in bondage. This was the first stage in the colony's existence. With the breaking up of the power of the New South Wales Corps and the appointment of Governor Macquarie a new era opened; and to this I devote the next chapter. CHAPTER II THE GROWTH OF NEW SOUTH WALES Large amount of convict labour available for employment--Free settlers too few to utilise it--Applied chiefly to public works--Premature erection of public edifices--Convicts given good wages and plentiful drink--Many grow rich--Governor Macquarie favours convicts unduly--Hostility shown him--Strong antagonism between classes--Great impetus to free emigration--Convict labour in demand--System of assignment revived--Discipline maintained by the "cat"--Efforts toward fair administration. The peculiar condition of the colony now was the presence therein of a supply of convict labour, growing larger also from day to day as vessels with their cargoes arrived, for which there was no natural demand. When General Macquarie assumed the government the influx of male convicts had been so great in the five years preceding 1809, that the free settlers were unable to find employment for more than an eighth of the total number, though the labour was to be had for the asking, and cost nothing but the price of raising the food the convicts consumed. In point of fact, the free settlers were still too few and their operations too limited. Seven-eighths of the whole supply remaining on hand, it became necessary for the governor to devise artificial outlets. He was anxious, as he tells Earl Bathurst, "to employ this large surplus of men in some useful manner, so that their labour might in some degree cover the expense of their feeding and clothing." The measures by which he endeavoured to compass this shall now be described.