13th Parliament · 1st Session
The President (Senator the Hon. P. J. Lynch) took the chair at 3 p.m., and read prayers.
– I ask the Minister for Defence if the Government has yet come to a decision on matters affecting the pay and allowances of the personnel of the Royal Australian Navy?
– The honorable senator was good enough to notify me that he proposed to ask this question? which is one in which he has been taking some interest. I am now able to inform the honorable senator that Cabinet to-day reached a final conclusion upon recommendations made by the NavalBoard last week with reference to certain re-adjustments of naval pay and conditions. It has been decided -
– Will the Minister for Defence inform the Senate whether he has received a communication in the form of an ultimatum from the ratings in the Royal Australian Navy, and whether, in view of the dissatisfaction which exists in the Royal Australian Navy, he has any statement to make on the subject?
– I have received no such- ultimatum.
– I - I ask the Vice-President of the Executive Council if the committee appointed by the Government to investigate the conditions in the wool industry has completed its investigations, and, if so, when its report will be available?
– The committee has completed its investigations. The report, which was handed to the right honorable the Prime Minister (Mr. Lyons) a day or two ago is now under the consideration of the Cabinet, and will be released at the earliest possible moment.
The following papers were presented : -
Tariff Board - Reports and recommendations -
Pipe Fittings - Wrought Iron and Malleable Cast Iron Fittings for Pipes, and Cast Iron Fittings for Pipes of less than two inches internal diameter. Yarns, woollen or containing wool.
Australian Soldiers’ Repatriation Act -
Regulations amended - Statutory Rules, 1932, No. 120.
– Can ‘the VicePresident of the Executive Council inform the Senate what stage has been reached in the negotiations for working the shale deposits at Newnes?
– I could inform the honorable senator, but the negotiations are of a very delicate character, and, as I desire to preserve the rights of the Government under the agreement into which it has entered, I ask the honorable senator to refrain from pressing his question at this stage.
Debate resumed from the 4th November (vide page 1920), on motion by Senator Greene -
That the bill be now read afirst time.
– I had originally intended, last week, to reply to some observations made by Senator O’Halloran, but, in the meantime, as a very long address has been interposed by Senator Collings, I should, first of all, like to offer some general comments about that. At the outset the honorable senator told us that he spoke, not for political party purposes, but purely for our enlightenment and, in the best manner of “ Holy Willie “, of whom no doubt he has read and knows something, he was a burning and shining light to this place, for over an hour and a half and a little more. The honorable senator deprecated the assumption of the schoolmaster attitude by honorable senators on this side of the chamber; yet he spoke for over 100 minutes in a manner typical of the schoolmaster. He told us that he was opposed to war of any kind, at any time, and in any way; but from start to finish he did not give utterance to one sentiment that was not bellicose. He assured us that he was an exponent of the brotherhood of man; but for over an hour he preached the gospel of class hatred. There was much in his argument that was sound - in fact, it was mostly sound, or, in the words of Macbeth, it was a tale “ full of sound and fury, signifying nothing.” It is true that after the honorable gentleman had spoken for an hour and a half, I rose to second the motion that he be granted an extension of time. I should explain that I did so out of curiosity, because I was anxious to find out whether after he had spoken for an hour, and a half and said nothing, he could carry on for two hours and still say nothing that would merit a reply.
– Then why reply to his remarks ?
-So far I have not done so.
– Nevertheless, the honorable senator has wasted ten minutes of his time in general observations about, Senator Collings.
– I am afraid that Senator Daly is as bad a judge of time as he is of a great many other things. In the first place, I have not taken up ten minutes of my time; in the second place, I have not wasted time, because I still hope that Senator Collings may yet learn to say something of interest to the Senate, if only he will realize that material which is suitable enough for delivery to listeners from the tail of a lorry at Spring Hill, is not suitable in an address in this Senate.
I pass on now to offer some criticism of the remarks made by Senator O’Halloran. That honorable gentleman was at least coherent if, in my view, he was quite illogical. He put it, and this is the only part of his discourse to which I desire to refer, that the Scullin Government, by its tariff policy, had righted the balance of trade, and his complaint was that the trade balance was now being disturbed by the attitude of the present Government. The Scullin Government’s policy, he said, was a restriction of imports to an amount which we could pay, and an absorption of our own people in employment.
The honorable gentleman went on to Assure us that the Scullin Government, in pursuance of its policy, had converted an unfavorable trade balance into a favorable one. I do not concede that it is a duty of a government to concern itself primarily with the rectifying of trade balances; but I do contend that it is its duty to refrain from pursuing a policy, such as excessive borrowing, which may have the effect of increasing our imports beyond a proper amount. A government is not in trade. Those who are responsible for our imports are in trade. We may assume that a government, purely as a government, knows nothing about trade, and that those who are in active business do know something about it; and as the consequences of any errors of judgment which they may make fall upon themselves, they have every reason to be careful in anypolicy which they may pursue.
– I - If we fail to meet our overseas payments the obligation falls on the nation and not on the traders.
– I should think it falls upon those who engage in trading enterprises. A government has to make arrangements to meet its obligations overseas, no doubt, and is in duty bound to see that they are discharged, just as traders are under an obligation to see that they are able to discharge obligations into which they have entered. But let us see what is in the claim made by the honorable senator on behalf of the Scullin Government. I refer honorable senators to some figures recently issued in Sydney by a very responsible body. They have been mentioned in a discussion not far from Canberra within the last few weeks, but it is desirable that their import should be well impressed upon the public mind. Let us take 1929- 30, the last year of the operation of the Bruce-Page Government’s tariff, and 1930- 31, the first year of the Scullin tariff, and divide imports into two classes, namely dutiable and non-dutiable goods. If the decline in imports was due to the operation of the Scullin tariff of high duties and surcharges, we might expect it to be confined almost entirely to those goods to which the increased duties applied. But what are the facts? We find that as between 1929-30 and 1930-31, our total imports declined by 53 per cent, and that the decline in dutiable goods was 55 per cent., while the decline in non-dutiable goods was 51.8 per cent. Comparing 1930-31 with 1931-32, we find that the decline in our total imports last year was 27 per cent., the falling-off in imports of dutiable goods being 28.2 per cent., and that of non-dutiable goods 27 per cent. In the latter comparison, the falling-off of importations of the two classes of goods was practically the same. We may, therefore, assume that the decline in the importationofnon-dutiable goods could not have been due to any action taken by the Scullin Government. The figures do suggest, however, that the great fallingoff in the importation of dutiable goods may not have been the result of action taken by the Scullin Government. In fact, every person who has given any thought to the subject must, I think, realize that the decline in imports is not the result of governmental action, but is due to other causes altogether. In the first place, it is due to a decline in the national income of approximately £200,000,000, and in the second place to the cessation of borrowing abroad, which, in its turn, was indirectly attributable to the” first cause. Bearing these figures in mind, I suggest that Senator O’Halloran has not grasped even the elements of the problem which he set out to discuss, namely, that all trade is barter, and, therefore, must be reciprocal. Broadly, if we are not borrowing abroad, or rendering services abroad, our imports and exports will balance. They may- not balance over a particular month, or quarter, or even over a particular year, because trade does not take notice of what are, after all, merely arbitrary divisions of time. There must always be a certain lag between the drop in prices of exports, and the fallingoff in imports for the reason that Orders are given some little time ahead, and therefore, the volume of imports does not decline immediately there is a fall in the prices of our exports. In the course of time, however,” the matter tends to right itself as a result of the operation of the principle of exchange:
– D - Does the honorable senator argue that the national income may not be raised by producing in ‘Australia something that hitherto has been imported?
– The prices of world commodities, which mainly constitute our national wealth, cannot be raised by any action taken in Australia. Proof of that is furnished by the hopelessness of the efforts to raise prices that are being made to-day throughout the world, following the realization that it is the fall in prices which is responsible for our present condition. The Scullin duties, surcharges and prohibitions may have played some part in hastening a. fall in the importations of goods, which was inevitable, and, indeed, would have come about without them; but as I understand that action in this direction was taken upon the advice of very competent authorities. I have no criticism to offer just now concerning it; indeed, I approve of it. I disapprove, however, of the attempt to make it appear that the surcharges and prohibitions were really a part of our protective policy, whereas in fact, it was definitely proclaimed at the time -that they were imposed for a specific ‘purpose, and were not a part of that policy. When Sir Otto Niemeyer visited Australia, two years ago, he was asked to express an opinion upon the wisdom of surcharges and prohibitions, and he said, “ They are of no importance one way or the other. Australia will simply not be able to afford to import in the way she has been.” His words have been proved true, . and would have been so proved, even without the action taken by the Scullin Government. ‘
The converse of the argument that imports -dropped as a result of the operation of the Scullin Government’s policy is the . equally fallacious argument now being employed, that the recent increase of imports is. the result of the policy of thepresent Government. The claim -made by Senator O’Halloran in that Tespect, exhibits a wonderful capacity for seeing what lies on the surface, while failing to realize that there are, a little below the surface, forces that have to be taken into account. That is exactly the view put by Senator Collings, who held forth at length upon the “wrongs that allegedly are being done (by the present Government to the banana- growers, the peanutgrowers, and the sugar-growers. The honorable senator visits districts where bananas have to be transported across . gullies in “flying foxes.” He hears the complaints of these men and, : slightly altering the words of Tennyson -
Thinks the rustic cackle of his bourg
The murmur of the world.
He ‘pays no heed whatever to the claims of the rest of Australia. If those whom he represents are not given special privileges by means of the tariff, he considers that a grave wrong is done to them and complains in a very aggressive manner. Senator O’Halloran, however, puts the position in this way:For the first quarter of this financial year, despite the fact that the prices of some primary products have risen, we have an adverse trade balance of nearly !£3,000,000. I put it with all respect to the honorable senator, as Senator Greene did, that he is not ‘able to recognize prosperity even when he sees it. Because the Government compiles the figures that deal . with this subject, Senator O’Halloran jumps to the conclusion ithat it is responsible for the condition that the figures reveal. That is not so. -Our imports have increased, because the importer : has said, “ My . stocks . are running ‘low, I must get others in,” the manufacturer -has said, “I can do with additional machinery and raw material “ ; The retailer has said, “I must look ahead and make provision for the . Cup season and the ‘Christmas season “.
– W - Were there not aCup season and a Christmas season last year?
– Yes ; but the Scullin Government was then in power and that fact is wholly accountable for the difference. A special reason for the increase -in imports this year is that we have in power a government which indicates, -not so much what . the government is, as what the people of Australia are, namely, a people who ; are determined to take the hard road, if necessary, but at any rate the road of honest dealiaig; a people who are not preaching repudiation nor advocating wild-cat schemes for -the regeneration of mankind. That is the real reason for the increase, and far from being a cause foralarm, the fact that those whose lives have beendevoted to business, and who must sutler if they make mistakes, feel that the outlook in Australia to-day justifies them in adopting progressive ideas is justification for some rejoicing.
– Did not the increase of imports cause grave concern to the last Premiers Conference ?
– I did not attend the Premiers Conference; consequently I cannot say what the effect was on that gathering. But even if it felt concerned, oven if it is the view taken, not only by honorable senators opposite, but sometimes also by my friends on this side of the Senate, T still say that tha.t is an exaggerated view to take.
There is only one other matter to which I desire to refer, namely, old-age pensions. Senator O’Halloran suggested that the reductions of taxation that have taken place have been made at the expense of the old-age pensioners.
Opposition Senators. - Hear, hear!
– My friends opposite applaud that sentiment: apparently, therefore, even upon consideration they are prepared to adhere to it. But the position in regard to old-age pensions clearly is not the same as that which relates to taxation. If the position has been reached which -compels the Government to say, “ In the interests of the country we cannot take any more from the taxpayers in order to give it to oldage pensioners,” surely that fact must be realized. It seems to have been forgotten for the time being that the first attack - as it has been termed - upon pension payments was made, not by this Government, 1 but by its predecessor in office.
– I - In vastly different circumstances.
– In exactly similar circumstances, namely, the pressure of national finance. Whether at that particular time it was greater or less than it is to-day does not affect the principle in the least. I direct the attention of my honorable friend to the fact that when the Scullin Government gave effect to the Premiers plan, which included a reduction of old-age pensions, it was deserted by some of its own supporters. It has been said that farmers and other capitalists would resent any amelioration of taxation that had to be made at the expense of old-age pensioners. I remind Senator O’Halloran, however, that when last year an appeal was made to the country by the Government that he supported, every member of that party who opposed the Premiers plan, with one exception, was defeated at the polls. The view that I submit is the very converse to that of Senator O’Halloran. I claim that the old-age and invalid pensioners are just as loyal a body of men and women as any others. They have shown their readiness to make a sacrifice in their country’s interest, and I believe that they would show a similar readiness again, if the circumstances of the nation demanded it. The notable feature of every recent election, whether in the federal sphere, or in New South Wales or Victoria, is the fact that the people are behind the present Government, and are not, and were not, behind the party which Senator O’Halloran represents.
– It has been said by certain individuals that only those who have had a university education should take part in the making of the laws of their country. An eminent divine in Brisbane stated a few days ago that Australia was being run by a number of ignorant men in Parliament. I might suggest that we could certainly do without lawyers in Parliament.
– Lawyers become very tired of hearing some of the things that are said in Parliament.
– We do.
– There would be no objection on the part of many people outside Parliament if lawyers left it.
If a referendum were taken of the oldage and invalid pensioners to ascertain their opinion regarding the recent reduction of their income, I have no doubt that the great majority of them would vote for the retention of the pension previously paid. Some honorable senators opposite have talked about the need for sacrifices, but those of us. who have lived among the workers and are familiar with their struggles, know what it means to them when a few shillings a week are taken off their income. Possibly Senator Brennan has led a sheltered life; if not, he seems to have forgotten the days when he had to “ rough it “. I take exception to his remark about the “ rustic cackle “ of men who are fighting for their means of livelihood. Senator Payne suggested that we should be delighted to know that prosperity was around the corner; but thousands of people in Queensland do not share that view.
– There are also many thousands who do.
– There were at the last election, because of the colossal bluff practised by the party opposite; but I have no doubt that, at the next election, particularly if the Government continues on the lines that it has followed up to date, the people will vote for the return of a Labour administration. Like Mr. Ramsay MacDonald in Great Britain, the party opposite said to the people, “ Australia and the Empire are in danger. Give us a blank cheque, and, if returned, we will act as circumstances demand “. One of the Government’s first actions was grossly to betray the old-age pensioners by robbing them of a paltry few shillings a week. If Labour is returned at the next election, its first action should be to restore the money that has been taken from them. When the Financial Emergency Bill was under discussion in this chamber, honorable senators on this side pointed out that the measure, so far as it related to pensioners, would be practically unworkable. I think that one or two honorable senators opposite, including Senator Sampson. supported us in that contention. We predicted that an army of inspectors would be appointed to pry into the private affairs of many aged people. Senator Greene, the Minister in charge of the measure, said that no inspectors would be necessary; but, according to recent press reports, a number of investigators are to be appointed. These will be inspectors under another name, and I suppose that they will pry into the private lives of the pensioners in order to save a few thousands of pounds, so that friends of the Government may be relieved of taxation. I can conceive of no action more dastardly than that. We are now informed that, as the result of the Government’s policy, more revenue than was expected is being obtained. In the circumstances, a reduc- tion of the pension is seen to be unnecessary, and I hope that the Government will restore it to its former amount at the first opportunity.
– The honorable senator is too optimistic.
– We can only ask the Government to do its duty in this matter. A large number of pensioners have approached me in connexion with their financial problems. I am told that the office of the Deputy Commissioner in Brisbane has been besieged daily by hundreds of men and women desirous of making inquiries concerning their pension rights. No doubt there has been a similar experience throughout Australia.
Although Senator Payne has told us that the depression is over, I can assure the Senate that a number of industries in Queensland are still in difficulties. I refer to the growing of sugar, bananas, tobacco and cotton. The returns of the sugar-growers were recently reduced by £1,250,000 per annum, and, no doubt, the workers in the sugar-fields of North Queensland will suffer in consequence. There would be less reason to complain if the only loser, owing to the reduction of the Australian price of sugar, had been the company that is able to pay good dividends on its operations; but the workers feel that the money which will be saved to the purchasers of sugar will be taken from their pockets.
I listened with interest to Senator Payne’s remarks about using the unemployed to build better houses for the people. There certainly is need to house some of the people of Australia under better conditions. Outside Casino, in New South Wales, is an unemployed camp which is a disgrace to Australia, and, indeed, to civilization. If there were any Russian emissaries in Australia, I feel sure that they would be tempted to photograph the camp in order to show the people of Russia how the Australian workers are housed. Some hundreds of Australians are living there in huts made of rusty tins, notwithstanding that there are in this country sufficient men and materials to provide every family with a decent house. We, on this side of the chamber, believe that the time is not far distant when there -will be in Australia a proper coordination of our economic forces which will provide every family with a comfortable home. We believe in putting into operation a policy which will give our people decent living conditions.
In Brisbane recently, I attended a meeting arranged by those engaged in the baha.ua industry. About 3,000 persons were present, including Senator Collings, Senator MacDonald and myself, as well as Senator Crawford. Every one of the 30 speakers was connected with the banana industry, and a good case was put up for the Queensland growers. One speaker told the meeting that they were being appealed to, on the ground of national necessity, to set aside their own interests and accept the Ottawa agreement in the best interests of Australia and the Empire. The speaker went on to say that it was all very well to have a broad national outlook; but when the butcher, the baker, or the grocer called with his bill, it was not sufficient to say to him that’ he must take ‘a national outlook; he expected money. It is ridiculous to tell people who are in danger of losing their business to take a national view of the disaster that’ threatens them. I am not prepared to ask any one to make a sacrifice that I am not prepared to make myself. We should not do anything to force our people out of business on to the industrial scrap heap.
We, on this side, are frequently told that we should offer constructive criticism. I submit that the policy pf the Labour party is constructive. That policy, if put into operation intelligently and courageously, would practically abolish unemployment, and provide every citizen with a decent livelihood. In all political parties there are some who believe that that state of affairs can. never be reached under the existing capitalistic system.. The policy of the Labour party in regard to banking and finance generally was rejected by the people at the recent election; but if it were put into, operation, many of the things that trouble society to-day would disappear.
Some time ago, Senator Millen delivered a most interesting address. He delved into the .past, and showed ho.w money first came to be used, and he fol- lowed that with an account of the various processes which led to the present currency in this country. The honorable senator must have gone to considerable trouble to gather the information which he gave to his hearers. He told us of the currency in the time of the Carthaginians, and of the shells, rubber, wood, and other materials used as currency, at various times, by different peoples. The honorable senator did not tell us the currency of the Garden of Eden ; probably, it was either fig leaves or apples. When he mentioned that at one time cows were currency, I thought that Australia would never be poor if rabbits’ feet were currency. The world has reached a stage at which many of the old theories, if not discarded, must, at least, be critically examined. I read recently of a small island named Uap- I do not know whether the letters stood for the United Australia Party - in which grind-stones were used as currency. The man with the biggest grind-stone was regarded as the richest man in the village. The book told of a time when the chief of the island sent an expedition 200 miles to bring back a grind-stone reputed to be bigger than any in Uap. Unfortunately, a storm arose, and the vessel containing the grind-stone sank, but the sole survivor of the expedition told such a tale about . the grind-stone they had found, that thereafter he was regarded as the richest man among them. Later, the island came into the possession of Germany, and when the Germans found that those who possessed big grind-stones would not work, because they were supposed to be wealthy, they sent men around with a tar brush to paint a certain mark on the grind-stones to indicate that they belonged to the Government. In that way the natives were made to work. The book did not say whether any “ smart Alec “ went around and erased the marks. Sometimes we are almost as foolish as people of uncivilized races who imagine that they are rich because they possess a. number of stones of varying dimensions.. Some countries think themselves rich because they possess certain quantities of gold. Senator Colebatch, for instance, is of the opinion that there can be no salvation, for Australia or Great Britain until these countries get back to the gold standard.
– Until there is some backing for the currency.
– The honorable senator’ contends that our currency must have a backing, whether of gold, paper, or anything else, and that our people must not live beyond their means, but I do not think that he is one of those fanatics who believe that our currency must be backed by gold and by nothing else,
– He is coming around.
– I respect the views advanced by Senator Colebatch. I have listened to them with interest on many occasions, because the honorable senator has always been able to support his theories with sound argument. I believe that there is likely to be a big change before long in the matter of gold as a backing for currency. Not long ago those who now support this Government strongly opposed the proposal of the Scullin Administration to send gold to Great Britain; but quite recently a measure was passed in this chamber authorizing the Commonwealth Bank to utilize sterling instead of gold as a backing for our paper currency, and certain economists have now come to the conclusion that it is not so much a matter of having gold as a backing for currency, that it is of more importanceto have a backing of goods and services.
Sena tor Sir Hal Colebatch. - That is the point.
– If that be true then , any government worthy . of the name should legislate an such a way as to enable service to be rendered and goods to be produced. But so far as I can see, the present Government has taken no action to (provide additional employment or to increase production, its sole idea, as a perusal of the budget discloses, being to balance its budget, even if in doing so it has further to rob invalid and old-age pensioners. No fundamental action has yet been taken to provide the unemployed with work, or to make it possible for us to utilize the services ofthose out of work. I >can see nothing in the action of the Governmentduring its term of office which has tended in that direction. Various arguments have been adduced as to. what should be done.
A few weeks ago Senator Hardy, who has been designated by some as the Cromwell of the Riverina, said that it is essential to increase the exchange rate in order to improve the situation, and that at the same time the Government should introduce a sliding tariff scale to be varied as the exchange rate varies. I recognize that as a result of the increase of the exchange rate a certain amount of extra money has been placed in the pockets of the primary producers, and God knows they need it. I received a paper to-day containing a pitiable story of the conditions of some primary producers. We know that many people engaged in primary production are in a bad way and it behoves us to take any action we can to prevent their position becoming worse, but a high exchange rate, while benefiting some, is of no benefit to others. For instance, last month the Brisbane City Council had to remit £30,000 to New York, and the amount of exchange payable was approximately £23,700.
– It would be more now.
– The present rate of exchange may bring money into the pockets of the primary producers, but at the same time it does not follow that they receive all the additional money. Only a few days ago, a grazier giving evidence before the wool inquiry, said that he was not receiving the full amount of exchange. Honorable senators . on this side of the chamber are prepared to do their best for the primary producers. Speaking personally, I should say, that they should receive a bounty on production because then we should know that they actually received the money, whereas if the exchange rate is increased it does not follow that the primary producer derives any benefit from it. It is grossly unfair that a city council such as the Brisbane City Council should be compelled to pay such a large amount for transmitting money to New York. It means that . the ratepayers in the municipality, business people and working men and women are compelled to pay more than they otherwise would. The (exchange payments made by the Sydney City Council amounted to £9,364 in1930, and. to £153,066 in 1931, while it is estimated that for 1932 the payment on this account will be £167,397. If the generation of a unit of electricity costs 20s., only 4s. 2d. goes in salaries and ls. 11½d. in coal; the balance is made up by interest and exchange. That seems grossly unfair. Some better method than that of increasing the exchange rate should be adopted.
There appears to be something peculiar concerning the matter of exchange. On one side, we notice that one bank with the support of a number of newspapers advocates a certain rate, while on the other side we find other banks and newspapers supporting individuals opposed to an increase in the exchange rate. We understand that Senator Hardy, in placing his case for a higher exchange rate before the Senate, had the support of Mr. Davidson, the general manager of the Bank of New South Wales, and Professor Shann. I think we are justified in asking why Mr. Davidson, the general manager of the Bank of New South Wales, should be anxious to see an increase in exchange rate. It may be that it would be of advantage to the bank which he controls, and, of course, we cannot blame him for fighting for the interests of those whom he represents; but at the same time, this Parliament must look after the interests of all sections, and should not do anything to benefit any particular financial institution.
Others say that we can improve matters by ensuring economic unity within the Empire such as we have been endeavouring to do by the economic conference at Ottawa. That is a matter which can be discussed later when, I suppose, honorable senators on this side will have a lotto say; but up to the present, the considered opinion is that the Ottawa Conference will prove to be a dud, and that those who expected such a lot from it will be grievously disappointed. Only a few days ago, the Brisbane Courier, in a leading article, pointed out that we could not expect too much from Ottawa. That opinion is also held by a large number of people who;, in the first instance, imagined that the agreement reached at Ottawa would he the beginning of a new system which would result in lifting the load of depression from the inhabitants of the British Empire.
The PRESIDENT (Senator the Hon. P. J. LYNCH). - The honorable senator is not entitled to anticipate discussion on a motion which finds its place on the business paper.
– Honorable senators on this side of the chamber are as keenly desirous as arc other honorable senators to do the best possible for Australia and the Empire.
– We have the same suspicion as the honorable member for Maribyrnong (Mr. Penton) had.
– Yes, a suspicion which is well founded.
I was deeply interested in the speech delivered by the Prime Minister (Mr. Lyons), and also in the figures he quoted in respect to overseas shipments. We have had it dinned into our ears so often that our national income has fallen from £650;000,000 to £430,000,000- Senator Brennan told us about it this afternoon - that the people now believe that our national income has been reduced. I find, however, that the production of agricultural products is greater than ever. Increases of overseas shipments between 1928-29 and 1931-32 have been as follows : -
We should be thankful to the farmers for the good work they have done to assist Australia, but at the same time, recognizing the heavy economic strain upon the country, we should do something to assist them. I pointed out some weeks ago that it is only right that some effort should be made to come to an agreement with Great Britain in order to minimize the burden upon the primary producers of Australia. I realize that their products go to other countries, but the proceeds of sales in Great Britain are placed in the bank, and are bought up by the Commonwealth Government to enable it to meet its commitments overseas. At the same time, the farmers should be assisted to meet their, obligations which, in some instances, are double and treble what they should be. An effort should be made by this Government to convert our overseas obligations into securities bearing a lower rate of interest so as to ease the burden on our people.. Under existing circumstances our primary producers are faced by extraordinary difficulties, due to the catastrophic fall in world prices for our surplus commodities, and, as a result, Australia is being mulct in millions of pounds annually because of the failure of this Government to take the steps indicated. Although the area devoted to agricultural purposes in Australia has been increased from 28,000,000 acres in 1921 to 45,000,000 acres in 1931, the number of persons permanently engaged i?i farming has increased by less than 4,000. Our average wheat production for the ten years ended 1921 was approximately 100,000,000 bushels; in 1931 it was 142,000,000 bushels, and the estimate for this year is 189,000,000 bushels. In 1920 the number of sheep in this country was 81,000,000; to-day it is 110,000,000. Our wool production in 1921 totalled 625,000,000 lb. ; last year it was 912,000,000 lb. Turning to the dairying industry we find that in 1921 the number of cows was 2,550,000; to-day it is 2,631,000. Our butter production in 1921 totalled 208,000,000 lb., compared with 350,000,000 lb. last year. In 1921, the production of sugar cane, in which Queensland is so vitally interested, was 1,471,000 tons; in 1930-31 it was 3,689,000 tons; and the sugar produced totalled 183,000 tons in 1921, compared with 560,000 tons to-day. “While these figures indicate a remarkable increase in the productivity of Australia, the people of this country are suffering so severely that in certain sections of society a revolutionary feeling is being, manifested. This is due to the fact that those who are producing the wealth of this country are receiving practically no benefit from it. Great numbers of our primary producers and industrial workers are on the verge of bankruptcy.
On Friday last Senator O’Halloran in the course of an informative speech, clearly indicated the straits in which the farmers in his State find themselves, and the same may be said of primary pro ducers elsewhere in the Commonwealth. He showed that the interest charges on mortgages constitute their heaviest burden. Relief will not come until some scheme is devised for the raising of internal prices and a reduction of capital costs. All countries are faced with the same problem. Stabilization schemes with regard to commodity prices, exchange, and other factors, are propounded, but of themselves they will not prove sufficient, because the causes of the world depression are fundamental, and have their roots in the present economic system. Lord Melchet admitted, a few weeks ago, that the enormous increase in the world’s stocks of all commodities was a barrier to the economic recovery of the trading nations. This opinion is borne out by statistics furnished by the German Institute for Trade Cycle Research which, in a survey of the world position, discloses an enormous over-production in countless commodities. The same statistics show that in the middle of this year, compared with 1927, the world’s supply of wheat was two and a quarter times greater, the 12,000,000 tons available representing about 10 per cent, of the last world harvest; that sugar stocks amounting to almost 9,000,000 tons were SO per cent, greater than in 1927, and that the world’s supply of coffee was from three to four times as large as in 1927, being in the vicinity of 1,800,000 tons, or 65 per cent, of last year’s crop. Coffee, as we know, is produced principally in Brazil which has been so hard hit by the depression that, to ration the world’s supply, arrangements were made recently to dump huge quantities in the sea ; but much of it was washed ashore, and certain individuals endeavoured to place it on the market again. The authorities then resolved to use the surplus coffee for the firing of railway locomotives, but as this interfered with the coal trade, representations were made to the Government, and tho authorities were forced to build huge bonfires to destroy the surplus stocks. This, I remind the Senate, is the result of the present capitalistic system. While coffee is being burned in huge bonfires in Brazil, old-age pensioners in this country, who have recently had their pensions reduced by this Government, are unable to obtain supplies for their own use. The German trade figures show also that in the middle of the present year the existing world’s, supply of cotton was 50 per cent, greater than in 1927, being approximately 1,800,000 tons, or 40 per cent, of last year’s crop, and that jute stocks to-day are almost eight times larger than in 1927. The figures relating to stocks of rubber, coal, oil, benzine, copper, lead, zinc, tin, and a number of other commodities, disclose the same position. The London Times in its trade supplement of the 23rd July last, published this important statement relating to the unemployed problem -
If the two unci a half millions of unemployed were absorbed in the factory occupations, the national output- of manufactured articles would be on such a scale that the available buying markets . . . would be inadequate to absorb it. Hence, if such a method of labour absorption could and did take place, it would only precipitate a new crisis.
Obviously the existing social and economic system is fundamentally wrong. That this is so is apparent from the appalling distress in the reputedly wealthy United States of America where, according to recent statistics, the unemployed number between 9,000,000 and 10,000,000.
– The number is nearer 15,000,000.
– Probably the honorable senator is right. But the point I wish to emphasize is that if all those persons who are at present unemployed in the United States of America could he reabsorbed in industry, the output, under mass production methods adopted in that country, would flood the world’s markets and, as the London Times points out, precipitate a new crisis. Although Australia may not be in quite the same position as the United States of America, nevertheless the complete reabsorption of our unemployed in industry would result in a great, excess production of all commodities, with the possible exception of wool. In fact, it would be practically impossible for the world to absorb .ill the products of industry under existing methods of production. When Senator Colebatch was speaking on” this subject recently, I directed attention, by way of interjection, to the disparity between the increased productivity of industry and the purchasing power of the people, and asked what, in his view, was the remedy. I put the same question now to those honorable senators who take an interest in world affairs, and ask them to show how the stabilization of exchange, and the other proposals made to date, will supply the remedy. The trouble lies, as I have stated, in the present economic system.
A few days ago I directed the attention of the Assistant Minister (Senator Greene) to a statement made recently by Mr. George Crowley, the managing director of the City Mutual Life Assurance Society, who was reported to have offered to lend the Government £200,000,000 at 1 per cent. Mr. Crowley styles himself the senior director of the insurance companies of Australia. He was reported to have declared that the life assurance societies were prepared to lend the sum mentioned to the Government. Of course, that was a mistake. What Mr. Crowley said was, that he should like to see this done if it were actuarially possible, and in a letter to the Government, he outlined his views on the subject. According to press reports of the correspondence, he declared that Australia was producing more wool, wheat, butter, and other primary products than ever before in its history, and that owing to the fall in commodity prices, Australia had to pay three bales of wool or three bushels of wheat in settlement of debts which were originally contracted at the rate of one bale of wool or one bushel of wheat. That burden, he is reported to have pointed out, was too great for the people to bear, and the Government should, at an early date, fund our overseas debt for a period of ten years. The announcemen’t was made the other day that in a few hours the people of Great Britain fully subscribed a loan of £300,000,000 at a reduced rate of interest. Surely, then, the British Government can come to the rescue of Australia by reducing the rate of interest payable on our debt to it, and funding it for a number of years. In some quarters, it is regarded as treachery to the Empire to make such a, suggestion,, yet it is made by this eminent financial gentleman. These are the views, not of a blatant Communist or- of a currency fanatic, but of one who holds a high position in the insurance world, and who consequently speaks with some degree of authority. He says -
Would it not be worth while that a determined effort should be made to fund our overseas debts for a period of ten years? That would give us breathing time. The security for the creditors is there all right. There is no better security in the world, but for the time being it is sterile. It is frozen; it is not liquid. Call it by any name you like, the security is not realizable in cash any more than Australian pound notes are not changeable into golden sovereigns at the moment. Incidentally, may I ask: Is any one the worse off for this, in Australia at all events?
He tells us the old story that the prices of our goods have fallen, and that our national income has declined. He shows how the expenditure of the Commonwealth has increased, and how its revenues have fallen, and says -
I know how hard it is to make economies. There ure none of us who will refuse to sympathize with the various Australian Treasurers in the highly disagreeable and unpopular task which is set then). But what can they do? Hoping for the revenues to expand sufficiently to bridge the deficit is like hoping for the discovery of gold or oil. Tt is nothing more than a pious aspiration for the present, at all events, and it is the present that concerns us.
In every country in the world, with’ the exception of Russia, treasurers and governments. Micawber-like, are waiting for something to turn up, expecting and hoping that times will improve, and that the sun of prosperity will again shine on the community. Mr. George Crowley evidently is a gentleman who believes in acting, not in waiting. He refers to the number of unemployed as being between 300,000 and 400,000-1 believe it is larger - and expresses the belief that they could be absorbed in useful work. These are his words -
There is a great deal of work to be done. There are harbours to be constructed, roads to be made, marshes to be reclaimed, breakwaters and lighthouses to be built, irrigation and water conservation activities to be set going.
I shall not pass judgment on his scheme at the moment. He goes on to say -
I am well aware of the difficulties. T have been giving the matter much consideration, and it struck me that possibly something on the lines of what was done during the war, with the aid of the banks, could be achieved.. As the senior life assurance manager in Australia, I propose getting in touch with the. Federal Treasurer on the matter, and may have something more to say later. Failingthat, 1 am going to suggest to the Federal Government to make the amount available by an expansion of credit.
During the war, our currency was expanded, and that led to the robbery of our people. In his last speech in this chamber, Senator Colebatch illustrated the methods that were then employed. If a person had £1,000, he purchased a’ bond with it, and subsequently lodged that bond with a banking institution as collateral for another loan. If that sort of thing went on - and I have no doubt that it did - the people of Australia were robbed. Mr. Theodore, in one of his speeches, described in detail the process that was adopted when it was thought that the Sixth War Loan would not be subscribed, and that trouble would descend on those who were conducting operations in Australia, because of the impossibility of meeting our obligations. He said that an agreement was made with the banks under which certain people were approached and asked to contribute to the loan. For every £100 of scrip that they took up, they subscribed only £10. They and the banks shared the rake-off, but that enabled the war to be carried on. As Senator Colebatch has pointed out, the war could not have been continued but for this inflation.
– Here and everywhere else.
– Here and everywhere else. Unfortunately, however, the methods employed increased the wealth of those who already had plenty, while the working class and the old-age pensioners suffered; and they are still suffering today. The inflation of the currency resulted in the people being robbed. We are still paying for it, and shall continue to pay to infinity. Some men laid down their lives, gave of their health and strength and lost their limbs, while others were able to take from the people hundreds of thousands of pounds that they did not earn. It is the policy of the Labour party, that, in times of crisis, the manipulation of the currency should not be in the hands of private individuals or banking institutions, but should be controlled by the Government.
– Is currency inflation any better if governments are responsible for it?
– If there are any profits in a currency issue, and they flow to a government, they may be utilized in providing employment on public works. There is a considerable body of opinion which believes that the financial measures that enable a war to be conducted can be utilized to overcome crises in times of peace. To me that seems eminently logical. If an enemy were at our gates, the whole of our manhood, with the exception of a few philosophical anarchists, pacifists, and conscientious objectors, would rush to defend our shores. Let us suppose that there was sufficient to feed and clothe our troops, and sufficient factories to supply them with the munitions necessary to conduct operations, but not sufficient money to pay them. Would we muster them any say, “Well, boys, we need your services, but our finances will not allow us to pay you ; one-tenth of you must go to the rear and do what you can to provide yourselves with a living?” Would we reduce the wages of the remainder, or take from them sufficient to keep those who were unemployed? Would we have social service leagues and charity organizations to collect boots and uniforms for those who were carrying on the fighting? Honorable senators must realize the absurdity of such a position. Yet that is what is happening in Australia to-day. A large proportion of the industrial army is unemployed, yet no action is taken to provide work for them. If war broke out to-morrow, however, all the money needed to prosecute it would readily be made available. Demand is absolutely essential to keep the wheels of production revolving. In war time, there is demand and there is national unity; the financial interests and the captains of industry combine to assist the Government in conducting operations. In peace time, however, demand and unity are lacking, with the result that the wheels of production do not revolve. The problem, as I see it, is how to increase the demand of the people in peace time, so that the wheels of production may revolve and we may carry on our productivity. The real problem is to implement a policy under which every increase in productivity will effect a corresponding increase in the purchasing power of the people and create a demand that will lead, to the removal from the market of the goods that are produced.
– That can be done only if we can produce at a profit.
– That opinion has been expressed by several eminent bankers.
– It is quite clear to me.
– I wish it were quite clear to every one else; the problem would then be solved and there would be no occasion to reduce pensions. Mr. T. Buckland, president of the Bank of New South Wales, says -
The problem of absorbing the unemployed into permanent work can only be solved by measures consistent with increasing profits in industry.
– That is as old as creation.
– It has senile decay, and it is time that we altered it. It is the cause of a great deal of the trouble that exists in the world to-day. A circular issued by the National Bank of Australasia says -
No further borrowings will be approved unless governments reduce expenditure. This would involve a reduction in their establishments with consequent additions to unemployment, but the problem of resultant unemployment is secondary and should not deter governments from taking necessary action to balance their budgets.
Bernard Shaw takes the opposite view. He says -
Bankers are always wrong. They are always thinking of foreign exchanges and foreign trade. They are still looking forward to the impossible restoration of our old trade relations with foreigners.
Senator Herbert Hays is not in agreement with that.
– Take away profit, and you remove the incentive to produce.
– It must be admitted that the economic system is not now operating as it should, seeing that one-third of the world’s population is unemployed. This impasse has come about -under the present system of profitmaking, and those of us who have the best interests of the people at heart must take action to absorb the unemployed, even if it means the elimination of some of the profit. We on this side earnestly contend that, if putting the unemployed back to work would limit the profit of those who live on the people, that action should be taken. Mr. Reginald McKenna, at one time British Chancellor of the Exchequer, has said -
If wu mean to get rid of unemployment, we must have more money in existence to take up the increased production. If we mean to reduce our present amount of money, we shall not escape unemployment.
I do not imagine that the mere release of credit would solve the problem of unemployment; but I firmly believe that, if the banks could be induced not to restrict credit to the extent to which they are limiting it to-day, the position would be immediately improved. We on this side of the chamber go even further than that. Wc contend that the mere release of credit is not sufficient; but that we must, at the same time, find employment for our surplus workers. We must create work, in order that money may be put into circulation. Under the present system, some temporary amelioration of the present economic conditions could be brought about by utilizing credit. The party to which I belong is in favour of the nationalization of banking. That would not remove all our troubles, but it would be a step in the right direction. If banking were nationalized, credit could be made available for developmental works. Even Pharoah utilized the surplus labour of Egypt in constructing a great tomb; but, in Australia, millions have been spent in providing the unemployed with the dole, with the result that the morale of thousands of men has been undermined. Labour contends that, even under the present regime, the millions being spent in providing sustenance for the unemployed should be used for public works. A large sum has been spent in establishing Canberra, and some of the surplus labour might well be employed in providing additional homes in this city. In Brazil, when coffee was used in locomotives in place of coal, there was a complaint from the sellers of coal. Naturally private traders complain when governmental activities interfere with their means of livelihood. Under the capitalistic system, we must utilize the surplus labour on works of a noncompetitive character that will be useful. There is one way in which creditor countries could tentatively relieve their present economic troubles. They could absorb some of their surplus labour in the construction of factories; but that policy would eventually result in over production, and the second state would be worse than the first. Professor Copland has pointed out that, even in Australia, there has been over-capitalization of industry. About eighteen months ago, he says, there were 354 boot factories in Australia, but three of the largest of them, if working at full capacity, “could supply the people of this country with all the boots and shoes that they need. This fact shows that no effort is being made by governments in Australia to correct over production. Professors Copland and Wood, in their joint publication, Australia and the Gold Standard, remark -
What is required is a check to the .overdevelopment of capital construction. The strength of the boom associated with excessive capital construction to a large extent determines the severity of the depression that follows, and it is only by checking the boom that the worse effects of a depression can be avoided. … It would be much wiser to use the credit structure to prevent excessive capital development, and for this purpose it would appear desirable to establish some international investment institution that would co-ordinate investment policy in much the same way as it is hoped that the bank for international settlements will ultimately co-ordinate international banking policy.
I see no possibility of overcoming the present position so long as there is freedom in regard to the investment of capital.
– There is anarchy in production.
– Yes. In Great Britain, the Labour party favours the nationalization of banking, and contends that one of the first steps that should be taken for the purpose of preventing anarchy in production is the organization of production and distribution on national lines. The party suggests the appointment of a national investment board, to direct the flow of capital. Why should Australia spend money on unnecessary boot factories, when capital might be diverted to better purposes? We must control the flow of capital in order to utilize the resources of the country to the best advantage. In the Old Country, the Labour party favours the cancellation of reparations and war debts, with which most of us in Australia are in agreement, and that there should be a new ^monetary system which would reflect the potentialities of production rather than the reserves of gold. That is a reasonable « nd sensible policy. Much could be done in that direction, although we are powerless to alter the international monetary system. Internally much can be done to make money and credit subservient to commodities, and to make production paramount. That is what the Labour party i3 fighting for. To-day money is supreme; the lives and health of the people are sacrificed in order to maintain our monetary system.. We are told by certain interests that something must be done to guarantee prices to our primary producers. I believe that every step towards control is a step in the right direction. I regard the controlling of prices as a step towards the control of industry. If I were able, I should control the prices of all commodities, not only sugar and butter, as a means of overcoming some of our problems. I agree with Mr. Henry Ford that there is too great a difference between the prices received by the producers, and the prices paid by the consumer. For instance, the growers of bananas in Queensland work hard. They go Up and down the hills so much that Mr. Lyons and his Tory Government think of them as goats - but they do not receive for their product anything like the prices which consumers elsewhere in Australia have to pay for bananas.
The Labour party’s policy for the control of banking is supported by many authorities. The ex-Premier of Queensland (Mr. Moore) told the electors of Queensland -over three years ago, that if his party were returned to power in that State, it would provide £2,000,000 and 10,000 jobs. It did neither. But it did give one man a job; it placed Professor Brigden in charge of the Economic Bureau in Brisbane. Professor Brigden, who is regarded as an authority on economics, has stated -
The time might come when banks would be operated without regard to profit, becoming public utilities and public trustees, responsible to the public and business community in a way very indefinable but very real. It was fundamental that the banks must be free from political control.
The Labour party does not believe in the political control of the banks, but it does believe in governments giving effect to the policy decided on by the people. It does not believe that the views of individual members of any government should prevail over those of the electors.
– Has the Commonwealth Bank ever made a profit ?
– The people are of the opinion that it has. The Commonwealth Bank should be made a bank in the true sense of the word; it should not be so much controlled by the private banks as it now is. The Labour party believes that the banking system of this country should be controlled by the Commonwealth Bank, and it is working to that end. Many working-class economists believe that if the Government were to control the banking system of this country, it would merely mean the centralization of banking, without interfering with the present system of profitmaking.
– It would give that system a nasty knock.
– The centralization of banking would not, of itself, change that system, which always ends in unemployment; but. the nationalization of banking is a step in the right direction, although we must go further and get rid of some of the contradictions which now cause trouble. In 1924, Dr. Earle Page said -
The banks mindful of their own interests, have no such regard for the public welfare as is undoubtedly required. Their individual outlook and interests render them unsuitable for the exercise of that prevision necessary for the construction of a sound policy.
No one can blame them for looking after themselves. Nor can any one find fault with Sir Robert Gibson for looking after the interests of the Commonwealth Bank. Recently there was a divergence of views between Mr. Davidson of the- Bank of New South Wales and Sir Robert Gibson.
Unfortunately for Sir Robert Gibson, the views of Mr. Davidson were preferred. Sir Robert Gibson is only doing his duty in endeavouring to preserve the stability of the Commonwealth Bank, although, in doing so, he may not always act in the best interests of the people of Australia. There is a good deal of truth in. the statement of Professor Copland that, in time3 of prosperity, the banks are prepared to grant credit freely, with the result that there is an excessive development of capital production; goods are produced like water, the market becomes flooded, and then follows a depression. The policy of government control of the banking system should be endorsed by all right-thinking people who prefer evolution to revolution. If, under the existing system, the people of Australia cannot do those things which are necessary to get us out of our troubles, they will not stop at democratic and constitutional action.
– The system in operation in Russia has not been wonderfully successful so far.
– Whatever we may think of their views, we cannot but respect mcn and women who are prepared to suffer imprisonment, privation, and even death, for their beliefs. I do not hold with all that is done in Russia; but I believe that we in Australia can learn something from that country even as we can learn something from England, China, Japan, the United States of America, or, indeed, any other country. [Extension of time granted.] Arising out of war conditions, and the age-long tyranny of the Czars, the people of Russia have set up a new order of things. Some years ago it was my lot to be in close association with a number of intelligent Russians who escaped to Australia from Siberia, where they had been exiled. When I knew them they were good citizens. Later they went back to Russia to participate in the establishment of the new order of things there. I am not one of those who fanatically accept as correct all that is done in Russia. There are some people ‘who, if shown photographs of our baby clinics and told that they were a part of the new social system of Russia, would applaud; whereas they have no good word to say for what is done in Australia. I have no desire either to glorify Russia or to detract from anything that that country has accomplished. One of the greatest sociological experiments the world has ever witnessed is now taking place there. Unfortunately, we do not know all about that experiment that we ought to know, because our Government has prohibited the dissemination of ‘ knowledge about Russia. The great Teacher said, “ Ye shall know the truth, and the truth shall make you free “. If Russia has something to teach us, why are we afraid to learn the lesson? The people of Australia are vastly different from the people of Russia. That Australians believe in individualism rather than collectivism, is seen in the sugar districts of Queensland, where the Italian growers have set up for themselves what is practically an Italian colony, whereas each Australian grower works on his own. Consequently, what suits Russia may not be at all adaptable to Australian conditions. We cannot introduce Russian methods into Australia ; we do not understand the psychology of the Russian people. Australians, realizing that the mentality of their own people differs from that of the Russian people, adopt other methods in order to overcome their difficulties.
We hope that it will not be long before a Labour Government will be on the treasury benches iu this chamber, and in another place, so that the Labour party will have complete control, and be able to give effect to a policy which it believes will be in the interests of the whole community. The Labour party believes that it is capable of intelligently organizing the economic forces, of Australia in such a way as to get rid of unemployment. The Prince of Wales, when speaking at the International Congress of Commercial Education, at which 35 nations were represented, said -
The world wide trade depression and economic disturbance has been largely caused by mal-administration or distribution. The potential output is far greater than ever before. . . .
This is the important point -
If all employable labour were employed for a reasonable number of hours per week, the world would have at its disposal a volume of commodities and services that would enable the entire population to live on a higher level of comfortand well-being than has ever been contemplated in the rosiest dreams of the social reformer.
I know that Senator Colebatch will probably have other suggestions to make, and that his views may not be entirely in accordance with those of the Prince of Wales. The quotation concludes -
Our urgent task is to bring consumption and production into a proper relationship - not a simple, but quite a possible task.
His Royal Highness does not indicate in what way this can be accomplished, but if it is his idea that the present hours of labour should be so reduced that every one can obtain employment, it is not unacceptable to the members of the Labour party. In Australia we could distribute the work available more equitably by reducing the working hours to six daily, and also by providing for two shifts a day. The Prince of Wales shows the way.
– And if an attempt were made to give effect to such a policy, Mr. Baldwin would intervene.
– The popularity of His Royal Highness is such that if the scheme which he outlined were found to be of benefit to the British people, Mr. Ramsay MacDonald, Mr. Baldwin, or Mr. Churchill would not prevail against him.
I have tried in my own humble way to express the thoughts that are in my mind. When I have had longer experience in the Senate, I may be able to deliver a more connected speech, and better express my opinions, but I have tried to show that Australia has the goods, the material, and, I believe, men with sufficient intelligence to re-organize our economic forces for the betterment of the whole of the Australian people. Such is my faith, and it will take a lot to shake if. I do not think that any economist can prove that our present economic system is the best for Australia. I conclude by quoting from Sir Arthur Salter’s book, Recovery-
We are, if we could but grapple with our fate, the most fortunate of the generations of men. In a single lifetime, science has given ns more power over nature and extended further the range of vision of the exploring mind than in all recorded history.
We need but the regulative wisdom to control our specialized activities and the thrust ing energy of our sectional and selfish interests. To face the troubles that beset us, this apprehensive and defensive world needs now above all the qualities, it seems for a moment, to have abandoned, courage and magnanimity.
Senator Sir HAL COLEBATCH (Western Australia) [5.12]. - I should like to say at the outset that I am sorry that Senator Brown did not quote, from Sir Arthur Salter, a paragraph which appears on the same page as that which he has just read; for in that other paragraph, the author clearly sets out his view that one of the principal causes of the continuance of our present trouble is the erection by the various nations of. tariff barriers against one another’s trade, and the creation by different nations of isolated and independent currencies. I counsel the honorable senator not to select only the passages of eminent writers which suit his own particular argument. If he reads again the whole page from which he quoted, he will find something of profit to himself. The honorable senator also quoted from one of the many speeches which the Prince of Wales has made recently. If the honorable senator had read the speech delivered by Hi3 Royal Highness on the eve of the departure of the British Economic Delegation to Ottawa, and that delivered byhim at the opening of the great exhibition at Copenhagen, he would have found that although, we are not told exactly how we can get out of our troubles, the Prince is of the opinion that no scheme will help until all the nations of the world resume trade with one another.
Senator Brown had a good deal to say on the subject of currency, and referred to opinions that I have expressed on this subject from time to time. It was not my intention to touch upon the subject to-day, but, out of courtesy to the honoroble senator, I feel that I should make some brief reply. I am not in any way fantastical. I am, I hope, a modest and industrious student of the big problems - problems with regard to which, unfortunately, we have not what one could call absolutely clear guidance.
– We are seekers after the truth.
– I am glad to hear that interjection from the Vice-President of the Executive
Council (Senator McLachlan), because it reminds me of the suggestion that I intended to make - that the Government should try to curb the petulance of one of its colleagues in another place. “We are seekers after the truth, but when we find a comparatively junior minister in another place denouncing the manager of the Bank of New South Wales for having issued a circular on a very informative matter that has a direct bearing upon our economic position generally, it seems to be approaching the ridiculous. I do not- bind myself to the opinions expressed in that circular, nor am I in the confidence of the Bank of New South Wales, but I have no hesitation in expressing the view that that circular has been compiled by one of the soundest economists in Australia. At any rate, he is one who has proved his soundness over and over again, as will be seen by any one who reads his book issued in 1927, in which he said that, unless we placed our house in order, we should encounter the trouble into which we have now drifted. I refer to Professor Shaun, who, I suggest, is the author of the bulletin to which reference has been made. It is the custom of big banking corporations in all parts of the world to issue periodically bulletins dealing with economic questions. There is no more valuable source of information for honorable senators or others seeking information than those bulletins issued, and banking corporations should be credited with having some knowledge of the business upon which they are engaged. Yet, we have a Minister in another place who, so far as I know, has no qualifications to permit him to speak with any authority on economics, not only upbraiding the Bank of New South Wales for issuing these bulletins, but even going so far as to threaten that institution by suggesting the possibility of a nationalized system of banking. What is the offence? Merely that that bank has had the temerity to express an opinion which is not entirely in accord with the views of the Commonwealth Government. When the same bank pointed out in one of its bulletins the dangers of a proposed fiduciary note issue, no voice was raised in protest. Even the members of the Labour party did not suggest that the bank was not entitled to express the views presented to us in that bulletin. But merely because it expresses its opinions on another matter, a Minister in another place has denounced it and threatened it with dire consequences.
The PRESIDENT (Senator the Hon. P. J. Lynch) . - The honorable senator will realize that he is not entitled to refer to the debates in another place.
– I read the statement in the press; I do not know whether it was or was not made in another place.
On the question of currency, I possess the simple faith that no government, bank, institution, or other authority should be permitted to issue currency without assuming an absolute responsibility to redeem it in something of world value. That is my simple belief in the matter. In the past gold has proved an efficient means to achieve that end. Reference was made by Senator Collings to a fiduciary note issue in England; but if the honorable senator will look at the figures he will find that the fiduciary note issue in Australia is infinitely larger in proportion to population than that of Great Britain.
– There is no analogy between the two issues.
Senator Sir HAL COLEBATCH.Before last September the Bank of England was allowed a fiduciary issue over and above the amount of gold held in reserve. In Australia, the Commonwealth Bank issues a larger percentage of notes in comparison with its gold than has ever been issued under any fiduciary note issue in England.
– Great Britain’s is non-promissory while ours is promissory.
– It is not.
– Of course it is.
Senator Sir HAL COLEBATCH.Will the honorable senator produce a Commonwealth bank note?
– I produce a Commonwealth note on which there is a promise to pay.
Senator Sir HAL COLEBATCH.That promise on the note is a lie.
– Of course it is.
Senator Sir HAL COLEBATCH.This Parliament recently passed an amending act which annuls that promise to pay. The promise to pay has no longer a legal existence, and I fail to understand why the Commonwealth Bank continues to print on its notes a promise to pay in gold because, as a matter of fact, we have by legislative act wiped out that promise.
– The promise to pay in gold was never on the English “ Bradbury.”
Senator Sir HAL COLEBATCH.I do not know that that has anything to do with the point, but until September of last year, there was an absolute obligation on the Bank of England to convert into gold all notes presented to it, not single pound notes, but notes of a certain value.
– There was not that obligation with respect to the fiduciary issue.
Senator Sir HAL COLEBATCH.If the honorable senator will study the Bank of England Act he will find that from April, 1925, till September, 1931, the Bank of England was compelled to redeem all notes; not merely those issued against gold but also the fiduciary issue, if presented in sums of, I think, not less than £400.
The point I wish to stress is that our fiduciary issue is much larger in proportion to gold held in reserve than the English issue ever was, and much larger than it was ever contemplated that it should be. This of course is the result of the new method of finance into which Australia, in common with other countries, drifted during the war and has since been continued. I do not suggest that it is possible to finance any war on a sound basis. If you go to war, necessarily there must be a currency inflation ; so it is obvious that nations which go to war must expect trouble afterwards. The fact is that we have devised a new method for the financing of governmental expenditure; Hitherto governments raised the money which they required, either by taxing the people, or by borrowing, to which, of course, there was a definite limit which had the effect of forcing governments to exercise a certain amount of economy in their expenditure. But during and since the Avar, governments have dropped into the habit of raising money by the issue of treasury-bills, the limit to which is much more indefinite than the limit to amounts which may be raised by taxing the people or by borrowing. Eor this reason we have not now the same check on governmental expenditure. But it must not be forgotten that the continued issue of treasury-bills means the piling up of interest obligations, which one day will have to be met. It is for this reason, no doubt, that the chairman of the Commonwealth Bank Board, Sir Robert Gibson, is anxious to put an end to this system of finance, and his anxiety, no doubt, is shared by the Government.
Reference was also made by Senator Brown to the depreciation of our currency, and the effect of the high rate of exchange on loans raised in the United States of America on behalf of the Brisbane City Council. To me the explanation is. simple. The present rate of exchange is merely the valuation in other countries of our currency. Because it has been watered down by the issue of notes to an amount of about £50,000,000 compared with £10,000,000 prior to the war, and by the issue of treasury-bills, our currency is to-day not worth what it was when the money was borrowed. Perhaps I cannot give a better illustration of what I mean, than by asking honorable senators to suppose, for the sake of argument, that Australia was suffering from a drought so widespread and severe that it became necessary to import all commodities for the feeding of our people. Does any honorable senator think that we could pay for those commodities in Australian £1 notes?
– I am not suggesting that.
– They are merely an internal instrument.
– They are, and when the Brisbane City Council goes to pay its interest bill in New York, it has to convert that internal instrument into an external value. In other words, it has to pay a heavy exchange rate on its commitments; because although we may say that that internal instrument is worth something which actually it is not. If we compare price levels in Australia with price levels overseas, we shall find that the purchasing power of the Australian £1 is much less than the purchasing power of the pound sterling, or the old equivalent in oilier parts of the world. The alternative for the Brisbane City Council would be to purchase goods in Great Britain or the United States of America to discharge its debt.
– Does the honorable senator believe in an increase of the exchange rate?
Senator Sir HAL COLEBATCH.I believe in exchange finding its natural level.
– Is it at its natural level now?
Senator Sir HAL COLEBATCH.I do not think it is. Our exchange rate is, to a large extent, regulated by an extremely high customs tariff, which prevents a reasonably free flow of imports and exports. If it were not for the present tariff, the chances are that the people who export would desire to import more heavily of the goods which they require than is now possible. If they were able to do this, our balance of trade would not be sufficient to discharge our overseas liabilities and it would become necessary to increase the exchange rate. But I am not one of those who believe that the exchange rate should be arbitrarily raised.
– Does not Mr. Davidson, the general manager of the Bank of New South Wales, believe in a higher exchange rate?
– I think that his view is very much the same as that of people who hold that, if we are to protect our primary producers and give them a chance to grow their produce at a price at which they can sell it overseas, we should have a lower tariff. If we do that, the exchange situation will right itself j but if, by arbitrary means, wo prevent the flow of trade, there is no means by which exchange can find its true level. We have no right to- use au arbitrary means of keeping it down, but if we do fix it arbitrarily we should fix it at a rate at which it would be if allowed to seek its own level, and that would be higher than it is now. That, however, is a subject which I do not intend to argue now.
It will be remembered that a few months ago when we were discussing a bill having for its object the purchase of sterling with our gold reserve, I think I was the only member in this chamber who raised any doubt as to the wisdom of that course. I wanted to know where the profits were coming from. The other day I put a question to the Assistant Treasurer (Senator Greene) on this subject, asking to be informed as to the amount of sterling which had been purchased. In his reply the Minister told me that it was considered inadvisable, in the public interest, to make the matter known. I am not quarrelling with the answer given, but I do suggest, from my knowledge of the value of sterling at the time when the bill was passed, that the Commonwealth Bank has since lost about 10 per cent, of whatever gold if did convert into sterling.
– What is sterling?
Senator Sir HAL COLEBATCH.Surely everybody knows that sterling is the currency of England, which has a certain world value. When we were debating the measure to which I have referred, the value of sterling was something under 90 grains of pure gold to the £1, the nominal value being 113 grains. To-day sterling is only equal to 77 grains, so if the Commonwealth Bank did convert any of- its gold into sterling at the then ruling price, and if it wished to convert sterling back into gold to-day it would lose about 10 per cent, in the process. In the circumstances, therefore, I am by no means ashamed of the attitude which I have taken up all along in regard to gold as the standard of exchange. I said at the time that we were departing from something which had a fixed value and were adopting, instead, something with a fluctuating value. It was said that sterling might go up and that the bank might make a profit, but sterling has gone down, and if the bank wished now to reconvert its sterling into gold it would find that it had lost one-tenth in the process. The point rises now, as I raised it then : Is it wise for the Commonwealth Bank to indulge in what is more or less a speculative operation ?
– There seemed to be no alternative at the time.
– As far as I know there was no particular reason why the Commonwealth Bank should convert its gold into sterling. It had about £10,000,000 in gold. I understand that it was intended to convert some portion of the reserve into British treasury-bills, which would earn interest. That might have been a good scheme. I refer to the matter now merely to show that those who stand by gold as the standard of value have not been proved to be wrong by recent events. I quite fail to understand how any member of the Labour party can, for a moment, advocate anything in the nature of currency inflation, which never has had any other effect than to build up huge fortunes to the detriment of the working class. What is the effect of making credit by inflation. Money is a title to wealth and services, and whilst I would not go so far as some of my friends in the Labour party in suggesting that big fortunes are necessarily destructive of all that is good in the world - it depends on how the fortunes are used - I feel strongly that when you have money constituting a title to wealth that does not exist, such as you have when fortunes are built up from the inflation of currency, it can do nothing but bring ruin to the community.
– Inflation is not our policy.
– I am not talking about the policy of the party to which the honorable senator belongs. All I have been doing is to point to the evils of inflation of currency from the point of view of the general community. To say that although inflation may be bad, deflation is worse, is much the same as to declare that for a man to get drunk is bad, but that it is a great deal worse for him to get sober. Perhaps there is some truth in that statement.
Senator Brown, in the course of his remarks this afternoon, referred to stock exchange gambling. Let me remind him that there is no greater incentive to stock exchange gambling than the artificial creation of currency - in other words, inflation. All forms of gambling are stimulated by it and always will be. I do not care what policy may be introduced, Labour or otherwise, in every case there must be value behind all currency that is issued; otherwise the country will be on the way to ruin.
– On the honorable senator’s argument this country will never support more than 6,500,000 people.
– What nonsense ! While I do not take the exaggerated view of some people who pretend to believe that this country can support a population of 100,000,000, I believe that it can maintain a population of 20,000,000 at a fairly high standard of comfort.
-. - How can we develop this country with our present currency limitations ?
Senator Sir HAL COLEBATCH.How has any other country been developed?
– By inflation.
Senator Sir HAL COLEBATCH.No. Inflation has only been practised in time of war. If tried at any other time it has always brought ruin in its train.
– Ruin is general now.
Senator Sir HAL COLEBATCH.Because inflation is general.
– The Labour party is not responsible for inflation.
Senator Sir HAL COLEBATCH.A Labour government started it in Australia by introducing and passing a bill to finance the construction of the EastWest Railway by an increase of the note issue.
I know that the question has been raised by some people, rather impertinently, I consider, as to my standing in connexion with political parties in this Parliament. It is well known that I stood as a nominee for the Senate as a member of the old Liberal and National party, with which I had been associated all my life, and the distinct understanding was that I should be under- no party obligations whatever ; that I should be free to criticize every measure brought before the Senate. That was the view I placed before my constituents. I do not quarrel with those who take up a different attitude ; but I am entitled to mine, and I intend to adhere to it.
– It was approved by both the Country party organization and the Nationalist organization in Western Australia.
Some of the best statistical and financial journals in London have very generously praised the action of the Commonwealth Government in endeavouring to bring its expenditure down to the level of its revenue. I believe that even Commonwealth Ministers are inclined to pat themselves on the back on account of what they have done. I by no means discount their achievement. At the same time, however, criticism and doubt are cast upon the budgets of the States. Those who are far distant from Australia may be excused for not understanding accurately the circumstances of the case, but no such excuse can be offered by those who live in Australia. The facts are, that the Commonwealth has unlimited power in regard to taxation, and that the States have very heavy obligations to their people. Prior to federation, and generally before the war, the States had a fairly sound conception of what they could afford to spend. Since federation, however, chiefly as the result of currency inflation, the idea has become generally accepted that what a person as a State taxpayer cannot afford and would not contemplate, can be afforded by the same person as a Commonwealth taxpayer, and that he is willing to bear whatever cost is entailed. That is entirely false reasoning. As federal taxpayers we cannot afford to spend one penny more than we can alford as State taxpayers. By combining, the States have not increased their resources; that process may or may not have aided the development of those resources, but it has not brought about a condition of affairs under which we can afford something that we could not previously afford. A fairly true test of the merits of Commonwealth and State economics may be applied by comparing the relative cost of the two authorities in carrying out services that are comparable. According to the measure that we are now considering, the annual cost of the Senate, excluding the allowances paid to senators, is £9,000. That is just about equal to the cost of both the Victorian. Houses, the figure in the case of the Legislative Council in that State being approximately £3,000. In New South
Wales, the Legislative Council, with upwards of 100 members, this year is costing £6,234, but that is largely because £2,317 is provided for the pensions of officers.
– The honorable senator is comparing a nominee with an elected House.
– I commenced with the Victorian Legislative Council, which is an elected House, and then went on to New South Wales, where there is a nominee Upper House. I assure the honorable senator that I should not overlook Queensland if it had a Legislative Council’. The cost of the Legislative Council in South Australia is £2,640, in Western Australia it is about £2,000, and in Tasmania it is a little less than £2,000. These are distinctly comparable services, and I do not know why the cost of the Senate should be so much greater than that of State Upper Houses.
– Why not abolish the Senate ?
Senator Sir HAL COLEBATCH.Why not’ stick to one point at a time. When a discussion arises as to the wisdom of abolishing the Senate, we can express our views on that subject. To-day, however, the Senate is a part of the Constitution. My argument is, that in comparing the good work of the Commonwealth with the bad work of the States in the matter of a reduction of expenditure, services that are comparable with each other should be considered. I say that the Senate ought not to cost very much more than State Legislative Councils of similar size.
– We meet away from our homes; the members of legislative councils do not.
Senator Sir HAL COLEBATCH.I am referring, not to the remuneration of honorable senators - I have excluded that - but purely to the official cost of the establishment.
– Yet the Senate has complied with the terms of the Premiers agreement more exactly than any of the States.
Senator Sir HAL COLEBATCH.That may be. I suggest, however, that it is very much ‘easier to effect a percentage economy when you are spending on a very large level, than when you are on a very low level.
– That is so.
Senator Sir HAL COLEBATCH t come back to the cold fact that this Senate, which is not appreciably larger than several legislative councils and is smaller than some, which does not sit any longer or do any more work, costs three and four times, and, in some cases, nearly five times as much as they do.
– Should we not also apply the percentage argument to pensions ?
– I do not know why honorable senators cannot apply themselves to one argument at a time. If there is anything unsound in my contention that the Senate, which discharges a service that is comparable with that of the legislative councils of the States, cost’s very much more, than they do, let the honorable senator combat it. Of what use is it to drag in all sorts of extraneous matters? I have no doubt that we do our work as well as any legislative council; although, personally, I should very much prefer the observance of their practice of transacting business in accordance with the Standing Orders, instead of the suspension of the Standing Orders in connexion with practically the whole of our business. We go to the extraordinary length of having on the business paper contingent , notices of motion, which, being always there, are entirely meaningless, and simply afford a means of evading the Standing Orders. I admit that there are very great difficulties associated with the meeting of Parliament in Canberra, and sympathize heartily with Ministers. For about seven years, I was a Minister in a State Government, and the duties of my office engaged me from 9 o’clock in the morning till 5 o’clock at night. ‘If I had to be away from my office during any period of the day for public or private reasons it involved night-work. How Ministers are able to do their work in their offices in the other cities when Parliament is sitting, I cannot conceive. I am afraid that that is one of the disabilities that must attach to this great city of Canberra for some time to come. I notice that the. Minister who has charge of the affairs of Canberra has said that proposed new works’ will place a substantial amount of new money in circulation. I wonder whether Ministers can let us into the secret as to where the new money is to be found! A national rose garden is to be established. I do not know that this is an appropriate time for expenditure on things of that sort.
I wish to draw another comparison between State and Federal expenditure. We have heard a lot concerning the proposed removal of the Patents Department from Melbourne to Canberra. I express no opinion as to the wisdom of that removal. I point out, however, that before federation the combined cost of the Patents Departments in the different” States was something like £8,000. A couple of years ago the expenditure upon the Commonwealth Patents Department reached a total of over £50,000, but it is now back to £42,000. In New Zealand, the revenue obtained from the Patents Department last year was £13,390, of which £8,000 was transferred to Consolidated Revenue. The cost of that department, therefore, was just over £5,000. A comparison of the figures in New Zealand and Australia will show that the Patents Department in the former covers about one-third of the activities of the Australian department, which one might expect, in view of the relative populations; but the total expenditure upon it was only £5,466, compared with our expenditure of £42,000. In the last ten’ years, the New Zealand department has hand.ed over to revenue no less a sum than £80,000. The fees, whatever is done with them, come out of the pockets of the taxpayers, because the man who pays them gets them back in some form or other. The New Zealand department makes large profits, and to that extent necessarily relieves the taxation burden. The Australian department does a great deal of work that is not done by similar departments in the majority of other countries, and the question arises very seriously: Is that work necessary, is it of any real value, either to the inventor or to the community, and, can we afford to , do all these things better than other people are attempting to do them? I say that we cannot, and that a more modest system of administration not only would be better, but would alao save the taxpayers a large amount of money.
My friend Senator Collings has Urged that money should be spent without regard being paid as to whether it is likely to be productive or not. That is exactly the course that we have been following for the last 15 or 18 years, and probably it has been a greater factor than anything else in landing us in our present predicament. I commend to Ministers the statement of the British Minister for Labour in the House of Commons, I. believe on Friday last, that the British Government had definitely reached the limit in relieving unemployment by means of public expenditure upon government works. He said, “It is not a sound method of curing unemployment, and so far as it has helped us at all we have reached the limit.” The reason, of course, is obvious. The money is spent, the work is done. The doing of the work has not given permanent’ employment, nor has it increased wealth. Consequently, both money and work are lost.
– Keep going and the unemployed themselves will solve the problem. . It will not then be a matter of getting the interest, but of losing the principal.
– I do not believe that the raising of money by issuing treasury-bills for expenditure on, ‘unproductive works will overcome our difficulties; that would only accentuate them. I have expressed my personal opinion on this matter on numbers of occasions. As far back as 1928, 1 pointed out that we should remove all the artificial barriers against trade, industry, and employment, and let them find their own level.
– Great Britain has now her trade barriers.
Senator Sir HAL COLEBATCH Generally speaking, Great Britain has stood up to her difficulties better than any other country. Like Australia, she had her currency problems created by the war. Financial difficulties as the result of the war were inevitable, and we are now faced with the problem of finding a way out of the morass.
On the notice-paper, and so far down that I do not think that I can be charged with anticipating debate, I notice that consideration is to be given to a customs bill. I am not going to discuss the merits of the measure, and therefore I trust that my remarks will be in order. One of the pledges made by several members of the present Government during the last elections was that they would restore the powers of the Senate in regard to customs matters. In fulfilment of that promise, a bill was tabled on the 28th April last, and it was read a second time on the 4th May. The measure was taken into committee on the following day, and an amendment was submitted by me, which I considered to be necessary in order to make the bill effective. That amendment’, with a slight alteration, was accepted by the Government, and provision was made in’ the alteration that the bill itself should not come into operation until the 1st January, 1933. I accepted that’ addendum very readily, because I had in my mind at the time that it was possible the. bill would not pass before that date. On the 5th May, that is six months ago, the bill was again before the committee, and I submitted another amendment relating to prohibitions, and whatever view the Government may have taken I venture to say that the opinion of the Senate was with me. At any rate, progress was reported. Six months have gone by, and we have seen nothing of the bill since. I think that the Government should carry out its election pledges. The life of governments is short; but despite the threats of Senator Collings, the life of this Senate is likely to be long, and it is more important to restore the authority of this branch of the legislature in regard to customs matters than to pass any one of the half dozen bills now before Parliament. Unless the Government honours its pledges, I am afraid that, not only this period of the session, but this Parliament itself may end without finality being reached in the matter.
One may feel some uncertainty as to whether the Government is in earnest in this matter when one finds that it is still imposing prohibitions without the authority of the Tariff Board, and without the sanction of this Parliament. I desire to draw special attention to what I think is the
Government’s latest prohibition, that with regard to the importation of glass. Let us consider the history of this matter. The Tariff Board submitted a report regarding plain, clear, sheet glass in which it recommended a reduction of duty to 2s. British preferential, 3s. intermediate, and 4s. general; and on and after the 1st December, 1932, 40 per cent., 50 per cent, and 60 per cent, ad valorem. The Government adopted the board’s recommendation, and tabled a resolution amending the duties accordingly. The next day a statement was made by the manager of the Australian Glass Com- pany that, because of this reduction, he intended to dismiss 250 men. The Prime Minister (Mr. Lyons), made an appeal to him not to act so precipitately, though, in reply to a question, I was informed that the right honorable gentleman had made that appeal to manufacturers generally. I remind honorable senators that when the Prime Minister asked that particular company, if it had any further representations to make, to submit its case to the Tariff Board. So far as I am aware, no such representations were made. Yet’ the following day, a statement appeared in the *Sydney Morning Herald that out of consideration for the Labour member for Cook (Mr. Riley), the member for the district in which the glass company’s factory is located, it had been decided to put the 250 men back to work ! If that was not a threat, I do not know what it was.
– It was moral suasion.
Senator Sir HAL COLEBATCH.Utterly immoral suasion, I should suggest. But whatever sort of suasion it was, it seems to have served its purpose, because, immediately afterwards, the Prime Minister announced that he had referred the matter back to the Tariff Board, and that in the meantime a prohibition had been imposed on the importation of glass. One of the facts that the board pointed out was that the Australian company had entirely failed to fulfil its obligations to its customers. The board quoted, in particular, a case typical of what had occurred in many other instances. In November, 1931, a firm in Western Australia ordered 41 cases of window glass. In accepting the order, the Australian manufacturers stated that they had not begun to produce, but that the order “would have special attention when we commence drawing.” A later advice stated that production would commence in the second week in January, 1932. On the 15th April, 1932, the company was advised as follows : - “ Will ship some sheet glass next week.” On. the 3rd May, the company was informed, “You may confidently expect order during next two or three weeks.” Up to the 21st June, 1932, the order had not been fulfilled, and it has not yet been carried out.
– There are hundreds of similar cases.
– I happened to be in Perth recently, and I took the trouble to investigate this particular case. The Government having reimposed this prohibition, merchants in Perth and elsewhere applied for some relief. Owing to the excessive duty on glass, and the failure of the Australian manufacturers to carry out their undertakings, the merchants in question ran out of glass. Building was being held up in Perth, unemployment was increasing, and “ men were being deprived of work, be- - cause glass was not available. Directly the lower duty was tabled, and before the prohibition was announced, the Perth firm, naturally anxious to get its business going again, cabled orders to London accompanied by cash. It paid not only cash for the goods, but also exchange and freight. The glass was. on the water when the prohibition was issued, and when the firm appealed to the Government to lift the prohibition and allow it to obtain the glass, it was graciously permitted to land 28 per cent, of it ; but the remainder had to remain in bond, to be cleared subsequently when the matter had been finally disposed of. If the Scullin Government had done that, the members of the present Ministry would have denounced it for having committed an act of administrative lawlessness, which would be a mild term to apply. Take the relative position of the different parties. The Australian Glass Company, an extremely wealthy concern, whose 20s. shares are quoted on the stock exchange at 44s. 6d., must be protected against the possibility of loss; but the ordinary glass merchants, citizens who are as much entitled as anybody else to the protection of the laws of this country, are to be deliberately deprived of both their glass and their money; their money is in Great Britain, and their glass is being kept away from them. Many of these merchants are in a comparatively small way of business, but because the Australian Glass Company threw out a threat, the Government, to please the honorable member for Cook, decided that the company must be protected, no matter to what extent the laws of the country are violated. In this instance, the Government violated not only the law, but also the Ottawa agreement, which prohibits the Government from taking action of this kind unless on the recommendation of the Tariff Board.
– The Ottawa agreement has not yet been adopted.
– It came into operation on the day on which it was signed, although the method of implementing it has yet to be decided by legislation. It is in existence at the present time, but is ignored ; it is flouted.
What were the rates of duty on glass when the Australian Glass Company threatened to close its works? Under the Scullin tariff, glass costing £72 10s. 6d. in Antwerp, cost £333 17s. lOd. landed in Perth.
– What was the Australian cost?
– I ann speaking of the measure of protection afforded. Under the duties suggested by the Tariff Board, glass costing £45 in Belgium, cost £110 landed in Perth, and glass costing £88 in London, cost £154 in Perth. For twelve months, merchants have been trying to obtain glass from the Australian manufacturers ; but they have been put off week after week, month after month. Only to-day, I received a letter from Glass Distributors (New South Wales) Limited, in which the following paragraph occurs-
The position as far as the merchants are concerned is acute as they have demands for glass, but are not in a position to supply, owing to the action of the Federal Ministry in rationing the imports of glass, and the local manufacturers’ inability to supply.
In a letter addressed to the Minister for Trade and Customs, the secretary of the company states -
As Secretary of Glass Distributors (New South Wales) Limited, a company representing 95 per cent, of the glass merchants of
New South Wales, I have been requested by the members to advise you that at no time since the Australian Window Glass Company commenced manufacturing, has this company been able to supply the demands made for stocks by members of the Glass Distributors (New South Wales) Limited. This week members have been notified by the Australian Window Glass Company that their factory is closing down for a period of approximately eight weeks, consequently my members, being alarmed by the acute shortage of clear sheet glass of commercial quality in New South Wales, have requested mc to ask that permission be granted for them to take delivery of all stocks of sheet glass, which are on the wharf or in course of transit, as these particular sheets are urgently needed to fulfil the demand.
That relates to the position in New South Wales, where users of glass can readily get into touch with the factory; but I am more particularly concerned with the situation in Western Australia, where the merchants have never been able to obtain from the Australian manufacturers satisfactory fulfilment of their orders, and in most cases no fulfilment whatever.
– On what date does the secretary say that the works are closing down for eight weeks?
Senator Sir HAL COLEBATCH.This letter was written on the 4th November, and it states, “ This week members have been notified by the Australian Window Glass Company that their factory is closing down for a period of approximately eight weeks.” What right has this particular company to special favours? Why should it be spoon-fed, and pampered in this fashion at the cost of the general community? Why should honest merchants in Perth be driven out of their businesses; why should buildings be held up and men kept’ out of profitable employment when there is work for them to do, in order that this company may continue to experiment in the making of this particular glass, in the hope that at some distant future date it will be successful? What right has the Government to flout the Ottawa agreement and to impose these prohibitions in defiance of the Tariff Board’s recommendation?. What right has the Ministry, which all along said that the prohibitions imposed by the Scullin Government were wrong, to indulge in an act of administrative lawlessness which it denounced in others? Common honesty demands that these merchants who sent their money to England should be permitted to take delivery of the glass for which they have paid. Now that the Australian Glass Company has closed down, and there is no further fear of offending it, the prohibition will probably be lifted ; but the whole business can only be described as shameful. I am surprised that the present Government should indulge in such tactics.
I shall not anticipate the decision of the Government in regard to assisting the wheat farmers of this country, but, naturally, I have read all that has appeared in the press on the subject. A bounty on wheat is amply justified on the one ground, and on that ground only, namely, the heavy burden which the wheat-growers hove been called upon to bear year after year in the interests of other Australian industries. On the ground of the burden which the tariff has imposed on it the wheat-growing industry has an irresistible and unanswerable claim for assistance; but on no other ground. Otherwise it would not ask for assistance. I counsel the Government to regard the wheat bounty as a right of the industry; I counsel it to abandon the idea of merely assisting necessitous farmers. Why should we say to these people that we cannot help them unless our fiscal policy has reduced them to poverty?
– We have said that in the case of the pensioners.
– It would be a pitiable state of affairs if those engaged in one of our biggest industries were placed on the same charitable basis as pensioners or recipients of the dole.
– An old-age pension is a right, not a charity.
Senator Sir HAL COLEBATCH.Why does the honorable senator switch off to other subjects. I think that I voted with him on most matters affecting pensions.
– I am criticizing, not the honorable senator, but the Government.
– A bounty on wheat should be regarded as a right of the wheatgrowers. According to reports, . which I suppose were fairly accurate, the Premiers at the recent conference were not unanimous regarding the method of assisting the wheat-growers. Apparently, there was a general understanding that, if the Commonwealth Government would provide the money, the States would be responsible for its distribution.’ That is a commonsense method. Why should the Commonwealth Government be so greedy for power, so anxious to do these things itself? If it can provide £2,250,000, or some other sum. for the benefit of the wheat-growers, why cannot it hand that money to the States to be distributed by them as they think fit? Has the Government forgotten that the previous Government fell for the same reason? That Government thought that it would be a grand thing for the Federal Government to spend £250,000 in the relief of unemployment. Previously grants for that purpose had been distributed through the States. The Commonwealth Government had the honour and glory of providing the money: the States had to face the odium associated with its distribution. The Scullin Government, with its eye to the next election, decided to spend the money itself. That action brought about its downfall ; and if the present Government adopts the system which has been suggested in some newspapers, and provides merely a charitable grant to needy farmers instead of a bonus to the wheat industry, all I can say is that if its action does not go near to bringing about its downfall also, it ought to do so.
Sitting suspended from 6.10 to 8 p.m.
SenatorRAE (New South Wales) [8.0]. - I am sorry that Senator Brennan is temporarily absent from the chamber, because I wish to make a brief reference to his comments upon the effect of the tariff, or, according to his argument, the lack of effect, imposed by the Scullin Government. His argument really leads to the conclusion that tariffs are negligible in their effect upon trade, and if that is what he wished to imply, I entirely disagree with him. The creation of the Labour party in New South Wales arose from the fact that neither freetrade nor protection, which for some years was the dominant issue in that State, gave the workers a fair deal. The effect of our fiscal policy has been summed up by the expression that it is merely a question of whether one pr.efers to be roasted or boiled, seeing that neither system sub- stantially benefits the wage-earning class. I am still of that opinion. There is, however, one point on which both freetraders and protectionists might agree - that constant changes in the tariff dislocate business, and affect unjustly many sections of the people.
– Changes of government are also bad.
– Yes; but one can scarcely conceive of a change of government at present being other than for the good of the community. When an industry has been assisted by the imposition of customs duties, and men have been induced to invest their capital and employ their energy in developing it, frequent changes of tariff cause irreparable injury. Tariffs produce revenue, and stimulate secondary industries, but in tariff matters generally it appears that the world is going mad. The universal depression, from which we are suffering, is being accentuated by every community attempting to erect an impregnable tariff wall around itself. Countries failing to secure sufficient trade to absorb their surplus production proceed to exclude the production of other countries, and at the same time, endeavour to stimulate their own people to encourage trade with foreign countries. If that policy is pursued by all governments, a stalemate must eventually be reached. Protection producing such rivalry leads to commercial chaos between the various nations concerned. A nation that believes that in protecting its own industries it must shut out the products of other countries will sooner or later find that such a system must eventually break down. Universal freetrade is possible only in a socialized world. If all countries adopted socialism they would undoubtedly produce what they could conveniently manufacture, and exchange their surplus on equal terms with other countries. Therefore, those persons who say that protection and socialism are bound up together, have not studied the subject very deeply. Under the existing system it seems that there is some justification for a protective tariff in young countries, which, have to compete with highly industrialized communities, and particularly those with foreign markets, in which they can dispose of their surplus production at very much cheaper rate3 than those at which they supply their own people. It is, therefore, necessary that young countries seeking to establish manufactories should have some form of protection in order to be approximately self-contained in regard to their own major requirements. It may be necessary to give protection to certain industries in their early stages when they cannot stand alone. Experience has shown that where a country is working under either a freetrade or a protectionpolicy, the condition of the great masses of the people is not materially affected. Take, for instance, the present world-wide financial crisis, which seems to have settled upon us almost in a permanent form. Is there any marked difference between the conditions in Great Britain, which, until recently was a freetrade country, and those in the United States of America, which has a high protective policy? There are millions of unemployed in either country, which clearly illustrates that, apart from the profit which a protective policy enables some manufacturers to derive, it has no marked effect upon the conditions of the people generally. It is only another of those capitalistic devices which fail to accomplish their object; I am convinced that the present capitalistic system must be abolished and some form of co-ordination set up between the various sections of the community to enable them to work in harmony in producing and sharing those commodities which are necessary in a civilized community. It is generally conceived that we have practically solved the problem of production. There is no difficulty in producing real wealth. There is no difficulty in producing all those commodities which are necessary or useful in a civilized community, and we could, if necessary, enormously increase production. We have material and sufficient scientific ability to manufacture tremendously in excess of our requirements; but the problem is one of distribution. While the capitalistic system may have gone far in building up ability to produce, it has entirely failed to solve the problem of the > just distribution df the wealth produced. The only remedy is to change the system. Those like myself, who are accused of being “ Reds “, and who are so frequently denounced, realize that such a vast change cannot be brought about merely by passing acts of Parliament. They realize quite- as keenly as do those opposed to them, that socialism can be brought about only by making men socialists - by using arguments that will convince the people that socialism is not merely a Utopian theory, but is a policy capable of practicable application. Unless that system is applied civilization will perish, and we shall be faced with absolute chaos. If it is a crime to be termed a socialist, I am a criminal of the first order, and intend to- remain an unrepentant sinner to the end. We were told by Senator Brennan that we advocate class war. We do nothing of the kind. We have already pointed out that a class war already exists, and. that it is necessary for us to recognize to what its existence is due before we can apply a remedy. Those of our political opponents who denounce the mention of a class war or struggle think only of a state of bloodshed and chaos. They ignore the fact that our present civilization is founded’ upon class distinctions. Even in connexion with prohibitory legislation which has been enacted recently in this Parliament, there is class distinction. Under that legislation the importation of certain books, magazines and newspapers is prohibited. We have been informed by the Minister for Trade and Customs or officers in the Customs Department, that the importation of certain books into Australia is prohibited. It is true that the cheap editions are prohibited, but costly volumes which contain the same matter as the cheaper books are’ allowed to come in without any hindrance whatever. The argument is openly used that the common people cannot be trusted to read literature that is safe in the hands of the wealthy. Apparently such literature can be read by a person who can pay two or three guineas for a volume, but it must not be read by one who is only able to buy a half-crown edition. If a request is made for a ls. 6d. or 2s. 6d. edition, the book is regarded as a most dangerous work, one that should not be in the hands of the people. This is not a fancy picture. Many high-class publications, whether revolutionary or immoral, are permitted to be introduced into Australia, but cheap editions of the same works are banned. We have these class distinctions in many of our public utilities, such as, for example, first and second-class railway carriages, first, second and even third class steamship fares. These class distinctions are the product of capitalism largely, although similar distinctions existed in more ancient systems as well; and although a person may be of doubtful pedigree, the possession of wealth - the money power - ensures his place in society. We declare that the injustices which follow the observance of these class distinctions must be recognized before we can get rid of them. Therefore, I make no apology whatever for advocating that the working classes, at all events, should try to understand what the class struggle means. The capitalistic system of production by wage labour for profit instead of for use, which Senator Herbert Hays says has existed for untold centuries, means the existence of two classes in the community - one whose interest it is to get the most labour from his employees at the lowest rate of remuneration, and the other to do the least work for the highest pay. Thi3 is the foundation of the class struggle which emerges from our existing state of society, and we who are socialists believe it’ will be ended only when all sections are compelled to render equal service to the community. In other words, we believe in the application of the scriptural text, . that he who does not work shall not eat.
– That is one of the rules of the Communist organization, is it not?
SenatorRAE. - It is one of their slogans.
– It is embodied in the Soviet constitution.
– It is the very core of socialism. I am not one of those who wish to draw any fine lines of distinction between socialism and communism, except, so far as I may be justified by facts. I am aware that certain organizations, comprised ostensibly of socialists, are not prepared to fight capitalism. They prefer rather to trim off its excrescences and, so to speak, civilize the system. Such organizations are justifiably de- nounced by all true Communists. The distinction between those who are really socialists and those who are Communists, is one rather of method than of difference in fundamental principles. Both subscribe to the same doctrine, namely, that every member in a community who is physically fit should do his or her share in ministering to the needs’ of that community, and should share equally in the results of the labour of each. In every community, there are social parasites who live in luxury and never do an honest hour’s labour in their lives. We aver that while that condition of society obtains, and while there is every incentive to persons to acquire wealth by any means whatever, outside the criminal code, there must be a small but powerful section who, living without labour in any form, are virtually parasitical upon the remainder of the community. It follows, therefore, that since those who comprise that section obtain more than their share of the rewards of labour, the remainder must go short of the reward that is justly due to them.
I turn now to offer some comments upon one or two subjects that have been mentioned in this discussion. I refer particularly to our present banking system. We who criticize it are told that, because of our limited financial experience, and because we know nothing of the business or of currency problems, we have no right to lay unholy hands upon the important function of banking. I suggest, however, that as the present system seems to suit a minority, who are always up in arms against any proposal to make fundamental alterations in it, we arc entitled to do what we can to bring about the desired alteration. With, regard to the proposed nationalization of banking, it was stated at the last general election that members of the group with which I am associated, strongly advocated the entire abolition of private banking, and the substitution of a banking system that would be under political control. Just what is meant by that phrase is not, perhaps, very easy to define, because the criticism was somewhat general. In a sense, every activity in a community ia under political control. By this I mean that Parliament may, whenever it thinks fit,- pass laws to regulate it. Consequently every activity may, by means of legislative enactment, be brought under political control in that sense of the term. If political control means that politicians, as individuals, shall be permitted to poke their noses, as it were, into important matters of State and, for their own advancement or gain, interfere with State enterprises, we can all agree that political control of that kind would be an unmitigated evil and we certainly have no desire to see it established. We claim that the nationalization of banking would in no sense involve more political control than is exercised by any parliament when it is deemed advisable. This Parliament created the present Commonwealth Bank. The measure to establish that institution was passed during a former period, when I was a member of this Senate. At that time, the then Opposition to the Fisher Labour Government, comprising prominent representatives of the parties now in power, denounced the scheme in the most unmeasured terms. They fought the bill line by line and clause by clause, predicting in the most gloomy terms the horrors that would be brought about by its passage. I assure honorable senators that what I am saying now is no exaggeration of the position. The bill was subjected to the most virulent opposition by representatives of the party of which the present Government and its supporters are the lineal descendants. They declared that Fisher’s “ flimsies “, as the proposed Commonwealth £1 notes were termed, would before long not be worth 10s.
– They are not worth much more than that now.
SenatorRAE. - Does Senator Colebatch suggest that if the private banks had retained the right to issue their own notes, they would, to-day, be more valuable than the Commonwealth £1 note ?
– Under the old system, under which every bank was responsible for the redemption of its own notes, those notes would be worth 20s. to-day.
– While I may not know so much about finance as Senator Colebatch does, I have the misfortune to be a good deal older, and I am wondering if he remembers what happened when the banks failed in this country.
– The shareholders lost their money, but the banks redeemed their notes.
– In most cases, the notes were redeemed by the Governments.
– I happened to be a member of the New South Wales Parliament during the banking crisis and I took some part in the stone-walling of one of the measures which the Government introduced to relieve the banks. The first bill was one to make bank notes legal tender, so that holders of them could not demand gold.
– That was only a temporary expedient.
– It was in force long enough to enable the private banks to get out of the mess in which they were involved. Another measure introduced was one which had the effect of tying up deposits for a period, in some cases, of 32 years. In these clays, that would be called a moratorium. I would not call that a temporary expedient. The first bank to close its doors in Sydney was the Australian Joint Stock Bank. Upon reconstruction, it became known as the Bank of Commerce, and lately it has been absorbed by the Bank of New South Wales. Within a week of the closing of the Australian Joint Stock Bank,- only four banks were left open in Sydney. Two of those - the Union Bank and the Bank of Australasia - had their headquarters in London. The other two were the Bank of New South Wales and the City Bank. Even such a strong financial institution as the Commercial Banking Company of Sydney, closed its doors, and the City Bank was saved only because the others shovelled their gold into it. If a man in business had a few hundred pounds on deposit, and required it for the expansion of his undertakings, he had to borrow what he needed, and pay interest at the rate of 6 per cent., 7 per cent., or 8 per cent., while he received only 4 per cent, for his money under the reconstruction scheme sanctioned by legislative enactment. That indicates the manner in which private enterprise ran’ amok in Australia ; and it was not due to outside causes, as may fairly be claimed in regard to the present crisis. Money had been advanced to pastoralists, graziers, builders, and any one else who wished to participate in the then boom; consequently, when there was a slump, and boom conditions could no longer be pushed to greater lengths, the collapse occurred, first among the building societies, and almost immediately afterwards in the case of the banks. Had the Government not come to the rescue of those institutions, at the expense of the people, they would have been destroyed. In times of crisis, private enterprise is very repentant, and whines for assistance to the State, which it everlastingly decries when times are flourishing and it can pocket profits without hindrance. I was one of a small body of men who in the State Parliament said, “ If this relief is given to the banks, why should not the principle be applied all round? Why should they receive any better treatment than individuals who have their capital locked up in them, and as a result are in financial difficulties?” We fought hard, either to defeat that measure or to compel the Government to extend its operation to all who were financially affected by the smash, but were not successful. I relate those facts to show to those who continually vaunt the blessings of private enterprise, how in times of crisis it crawls on its belly to the Government for assistance, yet when conditions are flourishing denounces all kinds of State interference.
The one tiling that appears to exercise the mind of the present Government is the balancing of its budget. My patriotism - if that is the correct term - is not deep enough to cause me very much concern as to whether the budget is balanced or not. I certainly do not care very greatly whether the adverse balance of trade is rectified. But I am anxious that individual citizens shall receive sufficient to enable them to balance their budgets, and shall not have to continue on the dole for the remainder of their existence. My friend, Senator Colebatch, has voiced many sentiments with which I cordially agree. I do not believe that any country is justified in recklessly borrowing merely for the purpose of keeping persons in employment or of giving an artificial stimulus to trade. At the time of the bank smashes in New South Wales, prudent management would have made it possible to finance a moderate and reasonable public works programme out of the proceeds of land sales and land rentals. Clearly, it is wrong to pay into Consolidated Revenue the proceeds of the sale of land. When land is sold capital is parted with, consequently the proceeds should not be regarded as revenue. If, instead of borrowing money to build railways and other works, the proceeds of land sales had been devoted to that purpose, the onerous burden of interest, which is constantly increasing, would have been avoided, and our enterprises would have paid from the commencement. The State debt of New South Wales at that time was about £50,000,000 or £51,000,000. I then pointed out that if we continued to borrow and gave no thought to the redemption of our loans, we should be at the mercy of money lenders if we were faced at any time with the necessity to raise quickly a large sum of money to cope with a long-continued drought or other State-wide calamity, because already we were mortgaged up to the hilt and could not expect the favorable terms that would be given if our financial position was more satisfactory. I was opposed to reckless borrowing, which became very much accentuated in later years. One of our principal burdens in the present world crisis is undoubtedly the enormous interest commitments that we have to meet. That is why I stood behind Mr. Lang - and I would again in similar circumstances - in his magnificent attempt to bring down interest rates.
– Except on his own mortgage.
– That interjection is -unworthy of the honorable senator.
– It is the truth.
– It is not the truth. The honorable senator is. probably referring to the allegation that Mr. Lang lent the Labor Daily £13,000 at 5 per per cent, interest.
– That is so.
– As a matter of fact, he has never asked for one penny on account of interest from that newspaper.
– He could not get it if he did. He probably contracted himself out of any possibility of a reduction of interest.
– He did not. The honorable senator is wrong in his facts. At the time when these loans were made, there was no question of interest rates on the public debt being attacked, and the ruling Tate of interest was very much higher than 5 per cent.
– Is not this explanation being made rather late in the day? Why was it not made at the time?
– Mr. Lang is not one who goes out of his way to make explanations. While he was in power a member of the Opposition stated publicly in the State House that he had charged a widow woman, who had done business through him as an estate agent, interest amounting to 13 per cent. He did not bother to contradict that statement, but merely said “I advise the honorable member to make further inquiries.” The member concerned did so, and some little time later publicly apologized to Mr. Lang and said that he had been entirely misinformed. Mr. Lang did not adopt a virtuous or an arrogant attitude, but simply said “ I knew that that would be the result of the honorable member’s investigation.” It is not fair to make charges against any person unless one is sure of the facts.
Frequent references have been made to invalid and old-age pensions. Although the subject is becoming nauseating to many, I yet consider it necessary to restate my opinion upon it. I have already expressed the view that a decent family in any civilized community extends the utmost kindness and consideration to any infirm, crippled, or blind member of it, and that any decent community ought to act on as high a plane as individual members of it. It would be considered a heartless action to rob the aged and the blind, and therefore, in the legislative sphere, we should not countenance political robbery. We are told that the wheat-growers, particularly those of Western Australia, who are adversely affected by federal legislation, are entitled to a bounty, not out of charity, but as a right. Then why should we not regard the pension as the right of the aged people, who, having lived for many years in this country, may be classed among its pioneers? The Invalid and Old-age Pensions Act, as now amended by the Financial Emergency Act, is one of the most infamous measures passed in any country, because it makes the pension merely a loan-
– It was a dishonest compromise to effect a political crisis.
SenatorRAE. - That is so. Every penny now paid to the pensioner is recoverable by law. Every honorable senator probably knows of cases in which aged couples in receipt of the pension have acquired homes of their own, and members of their families who have lived with them have contributed towards their maintenance. The parents have fully made up their minds that on their death the . house property shall pass to the members of the family who have assisted to support them. But, under the Government’s astonishing method of saving the country from bankruptcy, a pensioner’s house can be sold, possibly on a fallen market, and the amount paid by the department by way of pension can be deducted from the proceeds.
– T - There are thousands of such cases throughout Australia.
– Yes. One recently came under my notice in which a husband and wife, who were in receipt of a pension, had insured their lives some years ago. One of them wrote to me to ascertain whether insurance money could be confiscated by the Government. I telephoned ‘ the Deputy Commissioner of Pensions in New South Wales, and I subsequently wrote to him on the matter. I have since received a reply to the effect that, under the present law, no pensioner may mortgage or transfer any real property without the permission of the department. It was stated that although an insurance policy was not real property, in the event of a pensioner dying, the whole of his estate could be levied upon for pension paid since the 12th October. Money obtained by means of an insurance policy would thus be part of the estate of the pensioner ; and, owing to the action of this Government of plunder and hunger, pensioners who have denied themselves many of the comforts of life to enable them to contribute to industrial insurance policies will be penalized.
The PRESIDENT (Senator the Hon. P. J. Lynch). - An honorable senator is not entitled to reflect upon a measure passed by this Parliament.
– I desire to reflect, not on the measure, but on those responsible for it. Generally speaking, I do not entertain personal resentment against my political opponents; but I do feel personal resentment because of the mean and despicable action of this Government.
– I again request the honorable senator not to persist in reflecting on an act of this Parliament.
– When Labour is returned to power, it will regard it as its duty to restore the invalid and old-age pension to the amount formerly paid.
– To the amount paid before the first reduction was made by the Scullin Government?
– Yes. I have no desire to accentuate the political differences in the ranks of the Labour party ; but I may 3ay that the Scullin Government’s reduction of the pension was one of the main causes of the differences which caused the split in Labour’s ranks. There seems to be either a complete misunderstanding, or something worse, in regard to the doctrine that is preached about equality of sacrifice. If parliamentarians have suffered a reduction of their remuneration to the extent of 25 per cent., can it be said that their sacrifice has been equal to that of the old-age pensioners? If a person had five suits of clothes, and gave away three, he would not be making as great a sacrifice as a person who had two suits and gave away one. It is not what is given, but what is left, which determines the degree of sacrifice. A 25 per cent, reduction of income involves a small sacrifice on the part of a man in receipt of £20 a week, compared with the sacrifice of the pensioner who has to exist on 17s. 6d. a week.
– Some of the old folk lost 100 per cent, of their pension.
– Yes. Some elderly people have surrendered their pension rather than lose their insurance benefits.
The attempts that are being made to balance the budget can result in but a temporary alleviation of the worst evils from which the country is suffering. Gladly as we all welcome proposals for the relief of poverty and unemployment, we are faced with the stern fact that, owing to scientific discoveries and inventions, the world is producing a super- abundance of the commodities that humanity requires. In all civilized communities it is impossible to dispose of the present production. High tariff walls are erected in nearly every country for the purpose of preventing dumping; but, at the same time, every nation is putting forward its utmost efforts to dispose of its surplus production beyond its own borders. It is estimated that between 60,000,000 and 70,000,000 persons throughout the civilized world are now without work, and keen critics say that .the greater number of them can never be re-employed unless they displace others in employment. Almost every day fresh inventions are announced, and whether small and comparatively unimportant or of great value, their effect is to displace manual labour. This thing has been going on for some time. Where is it to end ? It is said that machinery is for the good of mankind in that it multiplies conveniences, comforts and luxuries. It may for a few; but not always for those whom it throws out of work, denying to them even the necessaries of life. It is not sufficient to say that many of the things which are in everyday use to-day ‘by the poorest in the community were unknown, even to the wealthiest, a century or more ago. People do not feel the want of things of which they have never heard, or even dreamed. The gulf between the rich and the poor was never so great as it is now. A shortening of the hours of labour would alleviate the position to some extent. Obviously, if the working week were 24 hours, instead of 48 hours, more men would share in the employment available. But our present system does not permit of that, for so long as there is competition between rival groups of capitalists, there will be an incentive for increasing the hours of labour and reducing wages. Under the existing system we cannot hope for any great measure of relief, and for that reason I have no hesitation in saying that the chief work of the Labour party, even if in office, is to use Parliament as a forum from which to promulgate the Principles in which the party believes until a sufficient number of the people are so convinced of the soundness of those principles that they will use their com bined strength to abolish the present system and substitute for it a system under which, instead of production being conducted on anarchic lines, the activities of the community will be co-ordinated. One honorable senator said that there are 300 boot factories in Australia, although three of the largest of them could supply all the footwear required by the people of Australia. In that case, the overhead expenses of the surplus factories are added to the average cost of the boots and shoes sold. There is, therefore, a lot of waste and sunken capital. Similar methods are followed in other industries. If an undertaking shows big profits, others rush in to establish similar industries, until ultimately one or two of the stronger concerns either drive the weaker ones to the wall, or amalgamate and divide the trade. Modern methods of production entail considerable waste, because each person thinks only of himself. With the exception of Russia, the world has failed to adopt any system under which those who create wealth share in the proceeds of their own labour beyond the receipt of a bare subsistence and precarious wages. At one time, Great Britain was almost the only great manufacturing country, and she exported her manufactures to all parts of the world. She was, moreover, the principal carrier of goods by sea, and the chief buyer of raw materials produced by cheap coloured labour. These materials were manufactured into goods in Britain and sold throughout thi5 world; but, naturally, other civilized nations were not prepared to allow her to retain that monopoly for ever. One by one they bought machinery, mainly from Britain, and manufactured their own goods. Later, they made their own machinery also. Adopting mass-production methods, they shared with Britain the foreign trade, subsidizing their shipping companies to do so. In that way they built up their own industrial life; the process is still going on. One by one, the less advanced nations have adopted similar methods, until to-day the number of competitors is on the increase, while the field for their operations is correspondingly restricted. The capitalistic system is fast approaching a position in which it will either collapse or save itself by reconstructing on different lines. Personally, I have no desire to assist in reconstrucing the present system; I believe in its abolition. The production of wealth for profit is founded on human greed and avarice, which, in turn, produce other evils. In a civilized community those who produce wealth should enjoy it. Every one who is mentally and physically capable of doing his share must be prepared to do it, or become an outcast of society. At an earlier stage in this debate, Senator Herbert Hays interjected that unless profit were associated with production, the incentive to produce would be lost.
– That principle is as old as creation.
SenatorRAE. - I was not present at the beginning of things, and am not able to say whether the honorable senator is correct or not. I, however, challenge him to deny that the world’s finest work has been done for no payment at all. It may be said that the common every-day tasks of life do not evoke the heroic in us, and that, therefore, some incentive is required ; but I submit that to-day there are more people devoting their leisure hours to work which they love, such as writing books or plays, or composing musical productions, than ever before. Under the system which I advocate, there would be at least the incentive of the necessity to work in order to live; and no ‘one will deny that one of the greatest incentives to work is hunger. We need not be afraid that there will be ‘no incentive to work. Pride in doing one’s share, the enjoyment of the approbation of one’s fellow creatures, are as much incentives as is the hope of profit. At one time, socialism was a Utopian dream. From the time of Plato until the last generation, all sorts of fantastic works depicting the ideal state of society were written.
– A number of Australians tried to establish a Utopia in South America.
– What may be possible in a large community, or in the world generally, may be quite impracticable in a small community settling in a foreign , country.
– The conditions in South America were . favorable.
– Some conditions were favorable and others were not. The local conditions may have been favorable, but the rest of the world still worked under the capitalistic system. Generally, the conditions were not such as to promote harmony. Every fair-minded man will agree that for a few hundred people to try a social experiment in a distant land is entirely different from a nation as a whole attempting something similar.
– It is easier for a small community to start such an experiment.
– And easier also for it to be wiped out, which would be quite possible with the loss of a few of its leaders. There is a vast difference between a handful of enthusiasts attempting to do certain things and a fully-equipped nation attempting the same things.
– Under the present system the world has not succeeded in establishing harmony and decency.
– The world will sink into chaos, and the best elements of civilization will risk destruction, unless another system is adopted. We are told that under socialism there would be no individual freedom; but how much individual freedom have we now? Itis the iron law of necessity that guides most of us to do things which we would not do voluntarily. The ideals of the old Liberal party of Great Britain have been departed from. We are now prohibited from reading any literature with which the powers that be do not agree; we are not permitted to see films depicting the social life of other countries, unless the Government agrees; we are not allowed to address public meetings on subjects of which the authorities disapprove. Nor are we at liberty to participate in a procession, or to express our views through a newspaper, if those views are not acceptable to the party in office. Legislation recently enacted by this Commonwealth Parliament has robbed us of our freedom in these directions. We do not possess one tenth of the freedom enjoyed by the people of Great Britain. Books, magazines and newspapers, which are freely sold in Great Britain, the United States of America, and the principal European countries cannot be imported into Aus- tralia, unless the wrappers in which they are contained do not disclose the contents. We are treated as children by this Government, which, in effect, says the books are “naughty” and must not be read. The Government is the almighty ruler of this country, and in giving effect to its policy of prohibition, tells us what we can, shall, and shall not, read, and what matters shall be discussed on public platforms. It is hypocritical to say that we enjoy the rights of citizenship. This Government is deliberately slaughtering the freedom of the Australian people. I am convinced that we must take a very grave view of. the conditions now confronting us. It is useless to say that slight savings can be made in certain directions. Such paltry reductions in public expenditure will not result in emancipating the people, because we must look at the position from a world view-point. Admittedly the present world depres-, sion may be relieved in a small degree by local enactments and administration, but the cause of the trouble still remains. Anything we do can be regarded only as a temporary measure of relief. We cannot entirely abolish the deplorable conditions which exist. Why do not those who look upon us either as dreamers or as crude uninformed people, unfitted to govern, the country, show some other method with, which they are acquainted, of bringing an end to this disastrous state of affairs? Why do they not reply to the fundamental arguments we have advanced, instead of dealing with some trivial side issues? Even. Senator Colebatch, who looks at the present position from a less partisan view-point than other honorable senators opposite, has not disclosed his remedy to overcome the perpetual discord which evists between production and distribution. It has not yet been shown how those who create the world’s wealth, either by their labour or by their brains, can obtain a fairer share of what they produce, and how we can destroy the parasites which exist in every community. Until these problems are solved, the legislation which this Parliament has passed prohibiting this and that will be useless. The Government is trying to smother up smouldering fires which will eventually burst forth with greater violence. I am not one of those who believe in bloodshed, the destruction of property, or anything which tends to destroy the best elements in our civili- zation. Although we have equality of voting power, I am not one of those who agree that we are all politically equal. There can be no true democracy without political equality. At present a small section of the community has the right to control all other sections. The Government is merely sitting on the safety valve, and, its actions in the direction I have mentioned may eventually be responsible for violence and bloodshed. The responsibility rests upon the Government and not upon those who favour a different social system.
– The remedy suggested by the honorable senator is only speculative.
– It is better to speculate than to stagnate. It is better to try something new than to perish. At any rate, all our legislation is speculative. The honorable senator cannot dispose of the problem in such a light and airy way. It has been proved conclusively that our present social system has utterly failed to keep an overwhelming section of the community even in frugal comfort. We are now faced with a unique position that, notwithstanding the huge quantities of foodstuffs which we produce, a large section of the community is on the verge of starvation. That, in itself, is such an indictment of the present system that it is idle to say that a change is mere speculation. Any change that is made must be for the good of the people, and, if time permitted, we could further demonstrate that the world is approaching the adoption of a system such as we advocate.
– There is a better way than by revolution.
– It is too slow.
– All reforms are slow.
– What we advocate is not reform, but rescue. We can wait indefinitely for minor reforms, which we can do without, but we must solve the problem now confronting civilization, find a way out, or perish. Any student of Karl Marx knows that he raised socialism from a mere Utopian dream to an actual science. From his deductions, we can obtain a good deal of absolute truth. The Marxian policy goes beyond speculation, although speculation is a necessary ingredient in human . progress. Honorable senators opposite who are content to support the presentsystem, make no effort to relieve distress. All that they do merely touches the fringe, while the evils are becoming greater every day. A continuance of the present system cannot be further tolerated. Even if it means indulging to some extent in speculative work, we must take our courage in both hands, and apply our efforts in a practical way; otherwise bloodshed or destruction may follow, and the responsibility for it will lay at the doors of those who refuse to make a a change.
.- Standing Order No. 190 reads -
In bills which the Senate may not amend, the question “ That this bill be now read a first time “ may bc debated, and the debate need not be relevant to the subject matter of such bill.
Let me congratulate those who have already spoken upon the manner in which they have carried out the suggestion made in that Standing Order. I have long held the opinion that it is one which should be amended or abolished. Although it provides honorable senators with an opportunity to deliver entertaining, and sometimes, informative speeches, its retention seriously interferes with the despatch of business. I understand that the Government wishes to dispose of this measure fairly quickly. I could not help thinking, when Senator Rae sat down, that he would have made a most delightful engine-driver, for, instead of stopping his train with an abruptness that would almost throw the passengers out of their bunks, he would start pulling up about three miles before he reached a station. If I remember rightly, at 8.40 this evening he commenced his “ in conclusion “ observations. It is now 9.30, and the honorable senator has only just closed his remarks. I do not propose to follow his example. On the contrary, I intend to commit what, in the circumstances, might almost be regarded as an implied breach of parliamentary etiquette, in that I intend to deal with the bill. Perhaps I should not have done so if my colleague, Senator Colebatch, who preceded me, had not given me some reason for committing this breach of etiquette. The honorable senator had something to say about the cost of Parliament upon which I should like to offer some comment. There is no doubt that this Parliament costs more than State parliaments, but if honorable senators would, with me, consider the circumstances under which this Parliament was established, they would, I believe, agree that there is ample reason for this higher cost. Even Senator Colebatch will admit that the Federal Parliament is the most important institution of its kind in Australia. Its scope being much greater than that of State parliaments, ‘ it is supposed to attract to its ranks the best political talent available in this country, and to its service the most experienced parliamentary officers.
– There is a very poor showing from Western Australia.
– The totally irrelevant and obviously uncivil observation of my honorable friend, will not’ cause me to digress from my subject. In considering the costs of the Parliament, let us first discuss. its officers.’ It was but natural that, at the inauguration of federation, they should have been chosen from the foremost officers in the State parliaments. In accepting appointment, the gentlemen selected had every right to expect an increase of salary above the remuneration which they were receiving as officers of State parliaments. That was one reason why an increase of expenditure in connexion with this Parliament was inescapable. Again, the conditions under which we meet in this building - the most expensive, not only as regards capital cost, but also as regards running costs among all the parliaments of Australia - make higher administrative expenditure inevitable. My honorable friend spoke in this matter as if nobody else had ever thought of endeavouring to bring about the reduction of parliamentary expenditure. That may have been true of the position up to about three years ago when - I do not say this in any boasting spirit - I was able to effect some economies because the opportunity presented itself. Unfortunately, the political hero has not yet appeared who has had the good sense to retrench during years of prosperity when those who might have been dismissed from the Commonwealth Service would have had ample opportunity to obtain employment in some
Other form of activity. I freely admit that the circumstances are, to some extent, but not altogether, as Senator Colebatch has stated. He made a comparison of costs between the Commonwealth and other parliaments. These, I suggest, are not comparable, because every parliament in Australia has a different method of submitting its estimates and showing its costs. Some of the costs which the honorable senator quoted in connexion with the Commonwealth Parliament, amounting, I think, to between £2,000 and £3,000. are missing from the estimates of the Parliament of Victoria, because they are shown in the estimates for other departments, principally the Works Department, whereas all costs of the Commonwealth Parliament are fully set out in the Estimates which come before the Senate and another place. It will be seen, therefore, that the evidence which he called to his aid was not quite complete. I speak on this matter somewhat hurriedly - I have not had time to make that collation of accounts which is necessary before an absolutely accurate estimate can be arrived at - because I think the observations of the honorable gentleman should not go uncorrected or, at all events, unexplained. During my political life, I have, with much pleasure and instruction to myself, had many opportunities to study the undoubted ability of the honorable senator, and I can say with every confidence that in no walk of public life is he more successful than as a critic. I have heard him cut governments to pieces in Western Australia until I thought the fragments could never be re-associated. His criticisms have always had a salutary effect, and I have no doubt that they will be equally effective on this occasion. It may appear to honorable senators that ‘I am taking up the cudgels perhaps without reason, but you, Mr. President, are young in your office, and whatever sins have been committed in connexion with parliamentary expenditure may not be laid at your door. Still there is ample opportunity for you to sin, and suffer by criticism, and perhaps, improve conditions through that suffering. I take this opportunity to put the position clearly before the Senate, because 1 should not like the observations which the honorable gentleman has made to be overlooked.
Very shortly after 1 took office as President, it occurred to me that some savings were possible in the conduct of the Senate. I, therefore, gave my attention first to the refresh - inent-rooms, which have always been a bone of contention, believing that it would be possible to remedy some of the obvious defects in the management of those rooms. I thought as Senator Colebatch does, that a comparison with the management of other parliamentary refreshmentrooms would be the real test. Accordingly, I made it my duty, in August or September, 1929, to visit the parliamentary refreshmentrooms in Melbourne, Perth, Adelaide and Brisbane in that order. As honorable senators are no doubt aware, I already had an intimate knowledgeof some years of the Western Australian parliamentary refreshment-rooms, and it gives me some pleasure to state that I found there many useful examples for the conduct of our own rooms in Canberra. The success attached to the running of the Western Australian rooms is due to the fact that honorable members have taken a real and kindly interest in them, instead of what I may term the derogatory interest in regard to the running of the Canberra refreshment-rooms. Although the Western Australian parliamentary rooms cater for a smaller number of members, they are conducted quite as well as our rooms are, and the staff provides a meal nearly as good as that, to be obtained here, for a charge of only ls. 6d. The running cost, is infinitely lower than in Canberra, and altogether the rooms are on a distinctly higher level. I ascertained also that the State’ parliamentary refreshment-rooms are staffed to a great extent by females. I presented my report on the 24th October, 1930, to the Joint House Committee, to which T looked for advice, and assistance. The members of that committee proved very helpful after the first two or three meetings, which were inclined to be stormy owing to the party feeling, which, I am happy to say, subsequently disappeared. The report which I presented was unanimously endorsed. In a summary of the comparison between the Federal and State parliamentary refreshmentrooms, I showed how it would be possible to effect a saving of not less than £2,882 a year, without interfering in any way with the efficiency of the services rendered, or award rates of pay ruling in the Federal Capital Territory for persons employed in the rooms. But then arose our difficulty. After making inquiries I found that everything that could be done by legislation in this matter, was absolutely against the making of any arrangements which I had set out to make. Some years ago, mistakenly I think, all officers of Parliament, who are working in an atmosphere different from officers outside Parliament, were brought under the provision of the Public Service Act. The protection afforded to these officers made it almost impossible to effect any alteration of the kind suggested, because it would have been entirely illegal to cause the offices to be vacated and later to fill them again. At no time did I proceed to take any steps without availing myself of the advice of the Crown Law Department, and proving the suitability or unsuitability of it. Other means had to be adopted, and I am glad to say that the cost of running the refreshment-rooms and the Senate generally was cut down very materially. In this connexion, I pay a tribute to the officers of those two departments. I could have had no more loyal assistance than they gave to enable me to achieve the object that I had in view. During those three years, such economies were effected that the cost of the Senate and the Joint House Department has been reduced from £37,000 to £26,000 per annum, a saving of £11,000, or something like 28 per cent. I believe that this will prove to Senator Colebatch that a determined and successful effort has been made to reduce the expenditure upon these two large spending departments. There is not the slightest reason for exceeding those estimates. A little further economy may be achieved, although not to anything like the extent that has so far been the case; that rate of reduction, if continued, would in a year or two wipe out the expenditure entirely. I make this explanation for the benefit of my honorable friend, and in order that he may take hope for the future. I do not think that any one wishes this Parliament to adopt an undignified attitude.I have seen it suggested, in the press and elsewhere, that certain other steps should be taken in regard to the refreshment-rooms.
I believe, however, that honorable senators will admit that they are now highly efficient. A good deal of that efficiency is due to the co-operation of the officers whom I have mentioned, and particularly to the gentleman who at present occupies the position of Secretary to the Joint House Department. As the conditions have so vastly improved, I entreat honorable senators not to impair the efficiency of this most important branch of Parliament, and not to heed the advice of those who would turn it into a tuckshop. The staff is much happier, and is imbued with a better spirit to-day than some years ago. We may now claim - and I feel sure that under your direction, Mr. President, much will be done to justify the claim - that within the next year or two we shall have in our refreshmentrooms and in our Senate one of the most efficient, happy, and competent staffs that is to be found in any Parliament in Australia.
– Is there not room for a considerably greater reduction in the cost?
– There is room for a little further reduction. If the honorable gentleman knew as much as I do about the misleading way in which the estimates of other similar departments are placed before Parliament; if he was aware of the expenses that are debited to other departments; if he compared the size of this Parliament House and the cost of keeping it clean and well run with those of other Houses of Parliament ; if he made the necessary deductions for all of those things, I think he would admit that we are getting very near to the bone. If he wants a greater saving than 28 per cent, in three years, he seeks what is impossible. I assure him that the different form in which the Estimates are presented has influenced considerably the conclusion at which he has arrived. I can furnish him, if he wishes, with instances in which that occurs. I know that in the Estimates of the Victorian Parliament: the sum qf about £2,000 for the care and upkeep of the. office is shpwn in the vote for the Public Works Department. Furthermore, I remind him that a portion of the salary of the President the Chairman of Committees, and various other parliamentary officers, which appears inour Estimates, is omitted from the estimates of Other parliaments. That, in itself, makes a very big difference.
– How much would be saved if we had no Hansard?
– It is. very hard to say, Hansard has never come under my direct supervision. There is a good deal to be said on both sides. Such a debate as has taken place on this and many other first readings would not have occurred but for the existence of Hansard, which hasenabled Parliament to be. used purely for propaganda purposes. I do not allude to one “party more. than to another; but perhaps ‘ the Opposition is more actively propagandist! because it has less responsibility, and may make statements that it can conveniently forget when it assumes office. It isundoubtedly a fact that Hansardhas its good points. In the performance of its functions, it has practically nothing but good points. Possibly, however, its effect on the revenue an,d upon honorable members of both Houses may be far from good- If the thoughts of honorable senators were not embalmed in the pages of Hansard, I believe jthat they would hot speak to nearly the same . extent as they do at the present time. I do not know what could take the place pf Hansard, When, some months ago, I was asked by those in authority for’ my opinion on the matter, . Imade -the suggestion that it is a question which Parliament itself should decide; that the fullesf information shouldbe obtained by anhonorary select committee pf both Houses, and a report presented which would put the matter in its best . aspect, because it would be the most reliably informed . that could be . obtained:-
I do npt propose to allow myself the treat,of giving, a. discourse which, in the language of the poet, would: -
Other honorable senators have pleased and entertained us in that fashion, but I am satisfied with the remarks that I have made, believing, as I do, that Standing Order 190 is a great mistake, that I have been as brief as possible, and that I have confined myself as much as possible to the bill that we are now considering.
. -The honorable senator who has j.ust resumed his seat took quite a long while to prove the need for such an opportunity as the first reading of this measure affords, because he occupied 20 minutes in a discussion of the refreshment-rooms. I do not consider that there is any need for honorable senators to worry about the cost of the refreshment-rooms, or the meal that is provided in them. A decent meal is obtainable for 2s. and the prices’ charged for liquors are no greater than are asked outside. The only advantage that we derive from that department, so far as I can see, is that occasionally we enjoy free billiards.
In reply to an interjection by Senator Foll, the subject of Hansard was touched on by Senator Kingsmill. I consider that Hansard is a very valuable institution, particularly to honorable senators who siton this side, because apart from it, they get -very little publicity. The great tory newspapers of Australia, of which Ihave had an experience extending over the- last 25 years, give practically no reportof the speeches of honorable senators who sit pn this side, unless to have a damaging effect. As a matter of fa,ct, the reporting pf the Senate by the tory newspapers, judging by tbo.se that I haye seen, is nonexistent. I suggest that hiter vye might consider the possibility , pf securing, by som.e means, . a’ certain amount pf space in each pf Jha large organs in Australia, at least in thecities. “I ‘.do not go to the extent . of advocating, at present, a national . daily newspaper in every State ; but as a national. Parliament, we should certainly . demand . a larger measure of respect . than we are receiving. When I was reporting in Melbourne, the custom was to give three.quarters of a column of notes covering the debates. At present, I do not think that that is done by any of the daily newspapers, unless the matter be furnished by the friends of honorable senators opposite outside the ranks of the reporting staffs. 1 was told by a journalist that only one daily newspaper keeps a man regularly in this gallery. Frequently, it is empty; that was the case for ten minutes while Senator Rae was speaking this evening, although he represents about 800,000 electors - about two-fifths of the adults of Australia.
Senator Colebatch to day remarked that inflation had robbed the workers, and I interjected that I thought deflation had had a far worse effect. My experience, and that of persons who sell their labour power, is that during the last three years, deflation has been equivalent to daylightrobbery. There are many who, like myself, had put their savings into a small home, and now find that their equity in it, which amounted to between ?500 and ?700, has almost disappeared. A property worth ?1,200 would probably fetch at present ?800.
– Is it not inflation that has robbed them ?
– -I do not think so. That might be said of those who bought before inflation commenced, but not of those who built homes during the period of inflation. The community has received such a sharp lesson regarding the robbery attributable to the policy of deflation that many persons, otherwise good citizens, would cheerfully join in the civil war about which Senator Hardy is fond of talking, because their life savings have been lost. “When Senator Barnes, a few days ago, was discussing the subject of unemployment, Senator Greene remarked that Britain had a larger percentage of unemployed than Australia had. The latest figures show that Australia has about 400,000 unemployed, and that Great Britain, with a population at least seven times as large as that of Australia, has 2,800,000 out of work, which shows that the percentage of unemployment is about the same in Britain as in Australia. The United States of America, although the great creditor nation of the world, has a larger percentage ofunemployed than either Britain or Australia. It is lamentable that in a country like Australia, which is only partly developed, this evil should be so pronounced. The present Government has been in power for a year, but nothing that it has already proposed, or is likely to recommend, will more than tinker with the problem. The position as Labour men see it is damnable, and constitutes a challenge to our intelligence. I am aware that according to the latest figures, unemployment is supposed to be on the decline, but we must not attach too much importance to quarterly fluctuations of the returns.
– P - Particularly returns compiled at the height of the shearing season.
– Yes. At the present time the percentage of unemployment has slightly dropped on account of work provided by seasonal activities. In my opinion, the present crisis is due to the control exercised by the financial kings of the United States of America and Great Britain. The curse of deflation is not only that it has robbed the thrifty, but also that the present interest rates on our overseas loans represent about 6 per cent, or 7 per cent, compared with 3 per cent, or 4 per cent, before deflation took place, and we have to pay 50 to 100 per cent, more in goods exported to meet interest on loans. It appears that this lamentable policy has received encouragement from those who have invested thousands of millions of pounds in war loans. The financiers overseas have encouraged deflation, because it was in their own interest to bring about the present crisis. Fifteen or twenty years ago, when I was editing a daily newspaper, I recall having had occasion to refer to Murphy On Trusts, who declared that two financial houses, in the United States of America, by putting their heads together, could, within 24 hours, prevent the wheels of industry from running in that country. A famous American ambassador had put the number down as half a dozen, but Murphy merely named Rockefeller and the Morgan group. So we have reason to ask ourselves what chance we’ have of escaping from financial bondage. We are supposed to be an educated democracy; yet we seem to be like children wandering in the wilderness. We get our financial ideas from the Old Country, and it appears to me that, as the result of the Ottawa Conference, we shall pass into fiscal as well as financial bondage. All th at the present Government appears to be- doing to relieve unemployment will merely provide alleviation of the trouble for a few months.
At the last election, the people were told that if the United. Australia Party were returned to power, confidence would be restored, wealth would be poured out, and work would be provided for all. I recall that when returning from the Darling Downs, during the last election campaign, a young man in a railway carriage showed me a bogus representation of a Commonwealth £1 note that had been issued in large numbers by supporters of the present Government, to warn the people against what might be expected if the fiduciary currency proposals of the Labour party were put into effect. Referring to this action, the man remarked, “ I think that it is a rotten joke.” In my opinion, this was one of the dirty actions by means of which the present Government secured power. They promised the people that if they were elected to office, unemployment would be swept away, and by means of sheer trickery the electors were induced to return them with a majority in all the States except Queensland. I regret that the people of the other States let the electors of Queensland down.
According to the views of many Labour men, the present unemployment could be removed. In my opinion, the politicians of 60 years ago acted unwisely when they began borrowing on the London market. The private banks should not be permitted to wield the extraordinary powers that they now possess. They make extortionate demands upon the productive power of the people. I have always advocated a measure of social control of banking. If the present crisis became much worse, several private banks might get into such grave difficulties that they would have to appeal to the Government for assistance, as they did 40 years ago in Australia, New Zealand and other British dominions. In Brisbane, shortly before the last federal election, two small private banks put up their shutters, and one in Adelaide-street appealed to the non-Labour Government of Queensland for assistance. WhenI was on the hustings, particularly at Warwick and Stanthorpe, I learned that the Primary Producers Bank had closed its many branches. If the great private banks, even the Bank of New South Wales, encountered grave trouble, they would go, cap in hand, to the Government for a guarantee to enable them to stave off financial disaster. We recollect what took place in Queensland and Victoria in the ‘nineties. Even the great Bank of New Zealand, when on the brink of disaster, approached the Government of that dominion for assistance. Senator Colebatch said that the depositors did not lose their money.
– I said that the notes of the. banks were all honoured.
– I consider that a man who deposits money with a bank has every right to expect deposits to be honoured before notes. I may be foolish in my ideas; but if I were to put money into a bank I should expect my deposit to be honoured before paper currency was honoured. I know of a case where relatives of mine in Victoria deposited a life’s savings in one of the banks there - I think it was the Commercial Bank - and never saw a penny of it again. Tha-t was 40 years ago; but similar things may happen again. No one knows how long the present depression will last, with the exception, perhaps, of a few big financial magnates in London and New York who control the financial destiny of the world. In such an event as I have pictured, the private banks, including the Bank of New South Wales, will come to the Commonwealth Government for assistance.
– Not long ago the Commonwealth took their gold reserves from them.
– That they had gold in large quantities shows that they used the public credit for their own ends. When these banks come to the Government for assistance they really come to the people, and ask to be put on their feet. The credit of the country should be used in the interests of all its people because in the last analysis the credit of a country depends on the people’s productive power and mutual confidence. We should control our own monetary system. Long before the present outcry for the public control of banking, I wrote to a Brisbane newspaper in the following terms: -
My plea is for reconsideration of our position as humble borrowers at the counters of Shylock and Company, London, and servile acceptors of the position that there must always be unemployed, whilst we have confidence in our collective stability and there is plenty of useful work to do. We have had the spectacle of many hundreds of men engaged in constructive work thrown out of employment because of shortness of cash, though during the war hundreds of millions were raised in this country for destructive purposes. The worker and producer in employment eventually pay for those out of work and are taxed to cover the loss. What ought to be done under a Labour government is to obviate that loss by organizing employment. That can be done best by the Commonwealth, assuming full control of our financial system and wiping out the money profiteer for a start. To the workless, exchange difficulties are of far away concern and the sooner this is recognized the better for Labour advance.
And Labour advance, I submit, is the way for national advance and reconstruction in contradistinction to the conservative attitude of standing still and waiting for direction from outside Australia. With credit controlled by the nation, we could undertake a number of public works in times of crisis. One such work which could be undertaken is the unification of our railway gauges, and we would not have to ask Mr. Davidson, or his mouthpiece, Senator Hardy, for permission. The unification of the railway gauges would lessen the cost of transport to both producers and exporters, as well as to the travelling public. New harbours could be constructed, and existing ports improved. To-day Australia is run by a congeries of capitalist sections, united politically only because of a desire on the part of the anti-Labour forces to keep the Labour party out of office, and to keep down the workers. Even in Queensland there is a tendency towards centralization, although it is not so great there as in some of the other States. The tendency towards centralization is seen in the fact that one-half of the people of New South Wales reside in Sydney and its suburbs, while Melbourne and its environs contain over 57 per cent, of “the people of Victoria. Ports like Portland and Westernport are neglected at the expense of Melbourne. Rockhampton and Townsville are the natural outlets for large areas of productive country. Indeed Rockhampton is the natural port for an area as large as New South Wales. Other Queensland ports like Gladstone, Maryborough, and Bundaberg could be improved.
The development of the Northern Territory would be accelerated by the construction of a railway line, either from Cloncurry or from Winton, to Darwin. The people in the area which such a railway would serve understand tropical conditions better than do people in other portions of Australia. The land through which the line would pass is of good quality, and the distance to Darwin less than to any other railway terminus in Australia. A measure of socialism should be applied to the Northern Territory. Under private enterprise the population of. that portion of the continent will not grow as it should, but under a semi-socialistic scheme a number of our young people could be sent to the Northern Territory for a number of years. They could be settled under a system of regimentation, with the opportunity to return to southern States on finishing their term of settlement service.
– How would they be induced to go there?
– Necessity will compel people to do almost anything. If they were offered jobs there, they would go-
-Fo -For a policeman’s job in the Northern Territory over 700 applications were received recently.
– A young man came to me not long ago, and asked for my assistance in obtaining work for him in New Guinea. He was 23 years of age, and had passed the junior public examination of the Quensland University. He had had a good business training, and was in every way an admirable citizen. He was typical of many others who would be glad of an opportunity to settle in these areas. When the Constitution was being framed, there were some who rejoiced to . think that the Senate, at least, would never see the roughly-shod feet or the bowyangs of the workers.
– The workers were represented in the Senate from the beginning of federation.
– That they were represented, was a surprise to their opponents. Had it been thought at the time, that the representatives of the trade unions would have a chance of entering the Senate, the franchise for the Senate would not have been so liberal. For a person to be elected to the Senate he must receive a majority of the votes cast by the electors of a State.
The position in Australia, and the world generally, is so deplorable that means other than those at present being adopted must be employed if relief is to bo afforded to those struggling masses who are unable to obtain sustenance. As one means of relieving distress, the Scullin Government proposed a fiduciary note issue, and I cannot see why, in times of dire distress, controlled inflation can have a detrimental effect upon the community. I do not believe in starting the note-printing press with the object of issuing hundreds of millions of pounds’ worth of notes, but the limited issue of notes as proposed by the Scullin Government, was fully justified. The financial policy of that Government, which, if adopted, would have been of great benefit to the Austrlaian people, was obstructed by the to ry majority in this chamber. As a matter of fact, the tactics adopted by the tory section of this chamber necessitates some reform, which the people will eventually demand. An incident which occurred in 1917, and with which the Labour party was not associated, was a disgrace to our parliamentary system. The Senate, as at present constituted, is more powerful than the British House of Lords. Although honorable senators are elected for a period of six years, one half of the total number of senators retires every three years; but, before an election comes round, it frequently happens that the attitude of individual senators on particular issues is forgotten. This chamber should not have the right to veto the legislation sent to it from another place. At any rate, its power to veto any measure should not be exercised after twelve months.
– The members of this chamber are elected on the same franchise as that of another place.
– That is the only factor in its favour. Senator Duncan-Hughes, who represents the* wealthy interests of the community - I do< not say that offensively - would not. favour two boards of directors to control one company.
– T - The Senate is not elected on a democratic basis.
– It cannot be said that the Senate is elected on a democratic basis when a representative of New South Wales is returned by 800,000 electors, and 60,000 electors in Tasmania can also return one representative, who has voting power equal to that of the New South Wales senator.
– In effect, the members of another place represent only sections of shareholders, whereas the members of this chamber represent all the shareholders.
– We elect two boards of directors to control one business. The Queensland Labour party abolished the Legislative Council in that State, and I hope that it will not be long before this chamber is also abolished. We should not have two bodies to decide the same issues. Modern democracy is being developed in the direction of having only one house of parliament, a freer use of the referendum, and a judicious application of the initiative. It appears to be the policy of this Government to adhere too closely to the financial and trading traditions of other countries, and to depend too much upon what Great Britain does in matters of finance and trade. The Labour party is in favour of a direct break with such traditions. A member of the present Government said that trade with other countries was necessary, and that without such trade we would, in effect, be living by taking in one another’s washing. Some benefit could be obtained from international freetrade, as .Senator Rae suggested, but that would be possible only if all nations agreed to trade with each other. I agree with John Stuart Mill, who a couple of generations ago said that the peace of the world could be secured only by a free exchange of trade. The Labour party believes in the general principle of international freetrade and international peace, but when we find other countries exploiting us and raising tariff barriers against our products we, as a practical party, recognize the need for retaliation. Therefore we must scrutinize with jealous eyes the happenings at Ottawa. Mr. L. S. Amery, who was a Minister in the last Conservative Government iti Great Britain, wrote so far back as 1906-
A community might attain quite a considerable degree of well-being without any foreign trade at all, as, for instance, in the case of an agricultural community with well-developed home industries.
We are an agricultural community, and, if our home industries were well developed, we could be, to a considerable extent, self-contained. Our trade and financial policy should not be always governed by the opinions of Great Britain. Mr. Amery continued -
What becomes of the earth’s foreign trade, supposing it to be an economic unity? The earth imports nothing, except a few shooting stars and meteoric dust. But will the earth’s prosperity be affected by the absence of a foreign trade?
Obviously, no! Australia can grow practically anything, and our people are sufficiently intelligent to manufacture almost all their requirements. I hope that what I have said to-night will receive attention from other than members of my own party. Perhaps Senator Pearce and Senator McLachlan are too far advanced in years to alter their views, but the world is constantly changing. Not many centuries have elapsed since the thumb-screw and rack were in use, and when people refused to believe that the earth was round. I understand that Senator Pearce, in his political youth, expressed views more radical. As he grew older he found cause to change his opinions in regard to some matters, and apparently he has now gone the whole hog. But that has happened to men more intelligent than he.
We Australians boast of our education and of the intelligence, inventiveness and ingenuity of our workers. Are we to sit dumbly, at the feet of Great Britain and other European countries while they dictate our financial and economic policy? The present deplorable position of Aus- tralia, with 400,000 unemployed, is painful proof of the error of that attitude. I have no doubt that the Tory governments forty years hence will be more extreme than Senators Dunn and Bae are to-day. When, as a boy, I attended Sunday school I was taught to believe in a material hell, and of the certainty of being punished by eternal fire unless one went under some emotional transformation through being “ washed in the blood of the Lamb “. But even the good old Presbyterian Church has changed its doctrine. I have changed so far as my religious beliefs are concerned, but my politics are the same as they were when I first began to work among the unionists in a shearing shed forty years ago.
I have heard many sneering references to Canberra and the expenditure upon it. But I think Australia acted wisely in removing the National Capital from the jealousies and turmoil of Sydney and Melbourne. Although the plan of this city has been greatly changed from the original which I saw in 1912, the result is excellent. I would have preferred the site near Orange, where I spent my youth, but Canberra is very suitable for the purpose, and will ultimately develop into a city of which Australians will be proud. Neither parliamentarians nor public servants should be influenced by considerations of their own comfort and convenience. We should take the higher view that we are the pioneers of a great idea - a national centre removed from the vitiating influence of State capitals, a city which should represent the best in Australian public life and inspire the highest economic and social” ideals. A nation without vision will surely perish. I endorse Senator Collings’ plea for Canberra. We men of the Labour party have an appreciation of the beautiful; we advocate a better social order, and this city is a step towards a more enlightened nationhood. Australia is the only continent whose people are of one race, speak the one language, and have, I hope, one destiny. Whatever our political quarrels may be, I hope we shall settle them on a peaceful basis. Let there be no talk of civil war. It was absurd that because Jack Lang was in power men should be drilling and arming to resist constitutional government. In judging Canberra wo should endeavour to visualize what it will bc 100 years hence. I hope that the verdict of our posterity in 2032 will be that those who preceded them had “builded better and finer than they knew”. We cannot have perfection in the early stages of a new city. Had the impressions of the first discoverers of Australia been accepted as final this continent would never have been settled. The first adventurers in these southern seas, the Dutch explorers, landed on the north-west coast and found it so inhospitable, and, apparently, unproductive, that they reported it unfit for settlement. The British discoverers, led by Captain Cook, turned their attention to the eastern side of the continent, and finding the country there, including Queensland, more inviting, settled it in the typical John Bull fashion by transporting felons, some of whom had been convicted for trifling offences, and others for major ones. Australia boasts of one of the most intelligent communities in the world. Its population is now nearly 7,000,000, twice as large as that of the United States of America in 1775 when it cut adrift from Great Britain. Australia has been built on national lines, particularly in respect of the Federal Capital city and internal financial and trading systems. Our ideal is and always has been one people, one flag, and one destiny.
– Port Augusta would have been a more central site for the Federal Capital.
– I daresay that Senator Colebatch would have liked the Federal Capital to be established at Kalgoorlie. The Federal Capital, situated as it is on a fertile plateau, 2,000 feet above sea level, and surrounded by mountains which are snowclad in winter, must appeal to every Australian. Its summer climate must be appreciated by every one who has experienced the warmer climate of Queensland and the western part of New South Wales. Canberra, with its gardens, trees, and shrubs, presents a magnificent sight, and many tourists come here to view its beauties. I daresay that it will soon become the wish of every Australian to make a pilgrimage to Canberra so that, in after years, he may say that he has visited the Federal Capital, one of the most beautiful cities in the world. The climate of Canberra is in direct contrast to that of Queensland. In Canberra the winter is cold but bracing, but in Queensland it is mild and delightful. There we have the finest surfing beaches in the world. From Noosa Heads to Southport and Coolangatta stretches an unbroken line of surfing beaches and on them surf bathing is enjoyed throughout the year. As the poet says -
The months for surfing, be good to remember,
Are November to May, and May to November.
One can journey in two hours from these surfing beaches to the mountain ranges of Queensland which are covered with dense native jungle. It is the finest bush in Australia. There are forests of great trees such as hoop and bunya pines, kauri, red and white cedars, and others which are used for furniture. Every Australian should visit this wonderful area which abounds with orchids, palms, ferns, flowering creepers, and gorgeous wild flowers. The best time to visit the native bush is in the spring. Queensland is a delightful change from Canberra. Its mountains are portion of the great dividing range in Australia, and its arboreal beauties are surpassed only in the Amazon Valley in Brazil. The best time to visit and enjoy this wonderland of Queensland is in the late winter or early spring when the oranges and mandarins have ripened and’ the sugar crop is being harvested and not, as Senator Colebatch says, -during the crushing period. In the words of the poet -
When the sugar is milling
In cool crushing days ;
When the sunshine in soft rays is spilling
O’er broad Burnett ways;
And the citrus are fruiting
Full sweet to their cores,
And the fish schools are there for the looting
By Wide Bay’s long shores.
There are many fish stories; but they say that off- the Queensland coast the groper, or huge rock cod, reaches 400 to 600 lb.; which is as heavy as two or three heavyweight fighting men thrown into one. Senator Johnston, I believe, recently sampled the delights of catching the groper, the trevally, the bonito and the mackerel, which are the fighting fish of the entrancing coral sea, with its thousands of coral isles and cays, which lies like a vast inland lake within the Great Barrier Beef between Bundaberg, Gladstone, Rockhampton, Mackay, Bowen, Townsville, and Cairns. I know that Senator Johnston caught groper, trevally, and mackerel, for he showed ane some photographs; but the fish that lie caught were only about one-third the «ize of those that may be caught there. The honorable senator “also knows the beauties of the Eungella Range, with’ its native jungle, and understands that Cairns Range, Barron Falls and Atherton Tableland have also marvellous scenes set in even more tropical surroundings that has made the Far North of Queensland the winter paradise of Australia. This region has as many tropical, delights, and glories in as many coral gardens, strangely and prettily tinted fish, and wonders of forests of mighty trees, creepers and flowers as any other part of the world. Canberra and Cairns both start with a capital “ C.” They are at the opposite poles of climate so far as Australia is concerned, and when winter comes I feel sure that Canberra in the summer will be contrasted in the mind of every tourist with the other capital “ C “ - Cairns, the capital of tropical Australia and the centre for winter pleasuring.
I wish briefly to refer to the aerial ser- vices of Australia. I entirely disagree with Senator Hardy’s criticism of the Government’s proposals in this connexion. Any money that Australia has to spend on aviation should be spent in meeting the demands of the public for civil aviation services which do not compete with State railways. Queensland is like Western Australia, in that she has ample scope for the development of aerial transport. In Queensland an excellent service is rendered by Qantas in maintaining connexion by air with remote outback settlements, and the Northern Territory. It is far more important that the Commonwealth Government should spend money in increasing aerial facilities of this kind in the back-blocks of Western Australia and Queensland than in straining to meet a possible situation in this country like that visioned by Tennyson in the words: -
According to Senator Hardy’s recent utterances, as emphasized by Senator Dunn, the “ ghastly dew “ that will be likely to fall on us first will be that of our own countrymen slain by battling aerial forces in civil war.
I shall digress from the subject of aviation for a moment to refer to Senator Hardy’s recent activities. In Queensland, we read something about the honorable senator’s speeches, but having had a Labour Government in office there for fourteen years, and regarding ourselves as somewhat more intelligent than those not so favoured in that respect, we could mot believe that his reported remarks about civil war and organized resistance to constitutionally elected governments had been actually made. We thought it was nonsense. We put the reports in the same class as certain published remarks about the “mad solicitor of Sydney,” referred to by Senator Dunn. But the proof which Senator Dunn has advanced this evening suggests that Senator Hardy actually made the speech referred to, although he has denied doing so, at Newcastle. Senator Dunn’s proofs appear to me to bear the marks of genuineness. The report appeared in a country newspaper, together with reports on roads, bridges, town boards, and the like which usually appear in such journals. The remarks attributed to Senator Hardy were telegraphed from Newcastle, and the message appears to me to be genuine. I speak as an old printer, having spent a number of years in the industry. Senator Hardy apparently is, in his intelligence, a fair sample of honorable senators opposite. Senator Dunn, who is a fellow New South Welshman, would not readily discredit another Sydneysider. The speech complained of seems to have been made in Newcastle only a few weeks ago. This honorable gentleman, who has been telling us how necessary it is that the exchange rate should be increased, also talks by and large of civil war, of organized resistance to a properly elected government, and of what he would do with the Riverina force which he could rapidly gather about him. I am surprised that a New South Welshman should speak so foolishly of our democracy, in view of the fact that free education has been available in that State since I was a boy. I went to school in New South Wales 42 years ago. But perhaps Senator Hardy is to be pitied rather than blamed. Men get out of hand sometimes. But the honorable gentleman has been adopted by our friends opposite, and they must take the responsibility for his utterances and legal misdemeanours. I deplore the fact that a man who has reached a responsible position in this Senate should utter such stupid threats as are contained in the report referred to by Senator Dunn.
To return to the subject of aerial transport, I pay a tribute to Qantas for the very fine work it’ is doing in Queensland. A good deal of literature in regard to this enterprise has been furnished to us. Qantas practically pioneered the aerial routes throughout Western Queensland. It has also maintained aerial connexion with Darwin.
– And if has saved many lives.
– That is so. Honorable senators of this party are more concerned about the saving of lives than about the development of the air force. Just as the men of Australia were ready to serve in the last war, so the pilots and staff of Qantas would be ready to servo in the defence of Australia if they were ever needed. If we have money to spend on aviation, let us spend it on a service which will be of benefit to the public. In answer to the criticisms of Senator Colebatch and Senator Johnston of Western Australia respecting the benefits that Queensland has derived from the sugar industry, I point out’ to those honorable senators and also to Senator Pearce that of the total vote of £93,381 proposed for aerial services in Australia £65,310, or practically twothirds of the amount, is to be spent in Western Australia. That State is to get £2 for every £1 received by Queensland and the Northern Territory combined. Including the area covered by the Camooweal to Daly Waters service, Queensland is practically as large as Western Australia, although taking the two States by themselves Western Australia is the larger. I point out also that although £541,770 is to be spent on Commonwealth railways this year not a penny of that amount will be expended in Queensland, although obviously Queensland with its own railway service so near to the Northern Territory should be the first State to be connected with Darwin by rail. A huge volume of expert opinion is favorable to the connexion of Queensland and the Northern Territory by raiL
– A great deal of expert opinion is also against it.
– The majority of the experts are favorable to it; but the honorable senator, as a loyal South Australian, naturally desires to see the connexion by the Oodnadatta route. An agreement’ has been entered into which binds the Commonwealth Government to that proposition, and the Labour party does not desire to repudiate the agreement. Unlike many other people, we do not believe in the repudiation of binding contracts such as Arbitration Court awards, or in interfering with elementary ideas of British justice. Nor do we approve of a policy which will take from our aged and invalid the pensions to which they are entitled by law. Accordingly, we stand by that agreement, because we consider that South Australia is entitled to the direct north-south railway connexion, but we believe that, especially at a time like the present when there is urgent need for the employment of our people, there should be a connexion with the Western Queensland system so as to give a ready access also from Darwin to Brisbane, Sydney and Melbourne.
Recently the Rockhampton Chamber of Commerce addressed a communication to me urging a wider distribution of the air mail subsidy payable in Queensland. I hope that the Government will give the request favorable consideration. Organizations that are designed to serve big centres like Rockhampton, Townsville and Brisbane, especially if the services conducted by them de not compete with the existing railway system, are entitled to financial aid in establishing rapid means of communication with out-back areas, and particularly when we remember that the Western Australian companies receive an aerial subsidy of £2 for each £1 spent.
Queensland could be divided into three great States. There has been some talk of subdivision, but, unlike the Riverina movement, with no suggestion of civil war if it is not adopted. Central Queensland has an area of approximately 217,000 square miles - as great almost as that of New South Wales, which contains about two-fifths of the population of the Commonwealth. It will be seen, therefore, that there is real need for governmental assistance to improve air services, that help in the development of a territory which extends back 700 or 800 miles . to the boundary of the Northern Territory. I admit that Western Australia has a good claim for special assistance in the maintenance of its air services; but’ the same may be said of people living in the out-back areas of Queensland. I have had some experience of pioneering 400 or 500 miles west of Sydney, and I am. also well conversant with the whole of the Riverina country. Compared with similar areas in Queensland, the Riverina country is, as I said by way of interjection when Senator Hardy was speaking, a suburban area. While I urge the favorable consideration by the Ministry of the request from the Rockhampton Chamber of Commerce for a better allocation of the subsidy provided for civil aviation in Queensland, I think, a better plan would be to spend on these services a little more of the money which Senator Hardy declares should be devoted to the Air Force. so that we may be training, in times of peace, efficient air pilots who would be available for service should war come.
I am very much disappointed at the treatment accorded by this Government to the tropical industries of Queensland. That State, together with the northern rivers district of New South Wales, produces practically the whole of the tropical products marketed in Australia, But Queensland is not without its difficulties. The territory is so huge that, while production may be proceeding satisfactorily in a considerable portion of the State, a vast area may be suffering severely from drought conditions. Many people living in the southern States are under the impression that Queensland is overflowing with riches. That is not so. I invite honor- able senators to visit Brisbane and compare the public utilities to be found there- the Zoological Gardens, the Art Gallery, the university buildings, to mention only a few - with similar institutions in the capital cities in southern States. It is to be regretted that although great wealth has been produced in Queensland, comparatively little of it has been left in that State. At one time many. people appeared to be under the impression that, being a tropical State, it was not fit for white people. Consequently men who made money in Queensland enjoyed it elsewhere - mainly in Sydney and Melbourne. For this reason the public utilities of Brisbane are not comparable with those to be found in the southern capital cities. Not so much evidence of the “ stone rich people as the Dutch call it, is to be found in Queensland. Wealth production in that State is largely seasonal, and we know how ephemeral even stored-up wealth may be. Recently Senator Colebatch spent a few weeks in Queensland, and upon his return south he filled the columns of the Melbourne Argus and other, tory newspapers with articles dealing with the Queensland sugar industry, concerning which his conclusions were far from sound.
We in Queensland are much disappointed at the treatment by the Commonwealth Government of the Queensland sugar industry. The alteration of the agreement means a loss to the growers of approximately £1,400,000 a year, and the figures show that only 13 per cent, of sugar-growers pay income taxation. We are also disappointed at the position of the cotton industry. We believe that Australia should be a self-contained nation, and that cotton production and manufacture should play an important part in its development. I do not suggest that we should not import cotton goods from other countries, but we should have in the Commonwealth a nucleus of every industry that would be essential in time of war, the cotton industry being one of them. It is now feared that if it is not properly protected it will suffer, as the cotton industry in Queensland suffered after the civil war in the United States of America ended. The peanut industry also has not been well treated. The same may be said of the banana and pineapple industries, both, of which will suffer as the result of the Ottawa agreement. Soon we shall have Fijian bananas grown by black ‘labour in full competition with Queensland bananas grown under white labour conditions. This is the more to be regretted because it is not necessary. Not long ago, when I was on the Auckland wharf in company with the manager of an important Auckland banana importing firm, I saw huge quantities of Fijian bananas being landed, and I was informed that New Zealand, with its population of one and a half millions, provides a splendid market for the product of Fiji. If that market is not sufficient for the producers of little islands of about 7,000 square miles, I do not know what is. Queensland primary interests suffered at Ottawa because they were not directly represented at that gathering.
– Order ! The honorable senator’s time has expired.
Motion (by Senator Dooley) put -
That Senator MacDonald be granted an extension of 30 minutes.
The Senate divided. (President - Senator the Hon. P. J. Lynch.)
Majority . . . . 1
Question so resolved’ in the affirmative. [Extension of time granted.]
I was referring to the position in which Queensland has been placed by the Ottawa ‘ agreement. Australia is bound to be affected adversely if there is too much interference with the one State in which there is a large tropical production. New South Wales grows some bananas and sugar, and with better organization in production, Western Australia and the Northern Territory could add to our tropical production; but at the present time, however, Queensland is the only State in which tropical products are grown to any extent. But for these products, she would be much poorer than she is, and would need to look to the rest of Australia to provide money grantsto help her along. These products mean a lot to Australia, and on that account, Queensland should receive greater consideration than is being extended to her. When the opportunity presents itself, I shall deal at greater length with this subject, and place before honorable senators facts and figures that I have not used to-night. I have visited Fiji on a couple of occasions, and know something about its climate, which is practically tropical. The Fijians are a mixture of Melanesians and Polynesians. Honorable senators probably have some knowledge of the different tribes that inhabit that extensive area referred to in the old atlases as “ Oceania,” and comprising thousands of islands. Fiji has every reason to be satisfied with the excellent market . that it already has for its bananas in New Zealand. Those who “are responsible for the section of . the Ottawa “agreement which deals with that product, have no knowledge of Queensland, Fiji* and tropical production; , consequently, Queensland has been badly served;
I conclude by “again thanking honor-, able senators for having vindicated the right of every member of this chamber td equal treatment.
– The statement of the honorable senator who has just resum’ed his s’eat, that ‘the Labour party really favours international freetrader interests me profoundly. If that be . the case, it is hews to. me.
– It is a theoretical belief*, because the Labour party favours international peace, the attainment of which would automatically bring about international freetrade.
– In that casej we are not carried very much further, because such a . condition is outside the realms of practical politics.
I wish to comment briefly upon ‘certain matters connected with the Postal Department. To my mind, and to that of many other thinking people, the Postal Department is being extravagantly managed-, and we are not receiving from it the satisf action^ that we should. . The estimates of the department include an item relating to officers of the third and fourth divisions . who . are on the unattached list pending the occurrence -of . suitable vacancies. The term “ suitable is very vagu’e. The number of these ofiicers is not stated, but this year it is proposed to appropriate no less than £ 200,’000 for the paymenjt of their salaries. . They have practically nothing to ‘do. The department is heavily overstaffed, and it is almost impossible for a sufficient number of vacancies to occur to absorb those who are on the unattached list.
-Do’es the the honorable senatdr suggest th’at tlfey -should be discharged ? .
-I suggest that the whole of the estimates of the Postal Department should be very -closely scrutinized, and th’at substantial economies might be effected’ in it. It is hot within iny province to indicate how that could be done. On the figures submitted, however, it is clear that large savings could be made without impairing efficiency.
Some of the ofiicers of the Postal Department whose duty it is to attend to the needs of the public are frequently guilty of incivility. I have had personal experience ‘of it. I refer. particularly to one office close t’o Melbourne, the man in charge of which displays what I can only characterize as brutality towards those Who have to do business with hiin. He is most uncivil a’n’d Uncouth, and should be reported to the Postmaster-General, because h”e has been guilty of this conduct for some ‘considerable time. I have frequently lie’ar’d tibmplaiii’ts regarding ‘ his behaviour; yet his services are retained, doubtless a’t ‘a gobd salary, while more suitable persons “c’anhot improve their positions in the department. . It has been suggested that ‘the present Go’veriimeli’t is responsible for the reduction of the invalid and old-age pension ; but, so far as I can judge, the actual reduction Was (mode -by the last Govennnentj which lowered the pension from £1 to 17s. 6d. per week. Under the legislation brought down by the present Governriient, a minimum pension of 17s. 6d. per week is assured. Certainly, the administrative procedure has been tightened up, and very properly so, because many persons not entitled to the pension have been receiving it.. I see no reason why the Commonwealth ‘Government should iiot be recompensed “for (pensions paid to persons whb upon ‘their demise leave property.
– Would the honorable senator apply that principle to members of the judiciary?
– A principle that is sound should have ‘general application.
It has been said that there has been a reduction of income taxation. I find no evidence ‘of ‘it. On the ‘contrary, there has been, a heavy increase in the last year or two. This increase ‘has operated most unfairly, particularly the 10 per oeht. supertax ‘which was -imposed by the Scullin Government and ‘has been kept in force by the present Ministry-. I c’oilTd cite the case of ‘a widow who is in receipt of £250 per a’nnuin because of a life interest in an estate. Her ordinary federal income tax amounts to only £1 a year, but the super tax is £2.5. This tax places a heavy burden on persons who are not in a position to bear it. It is estimated that ordinary income tax will return an additional £800,000 to the revenue this year, and £4,000,000 is anticipated as the result of the special tax. Since nearly £5,000,000 additional income tax is to be collected, it can hardly be said that taxation has- been reduced.
Honorable senators will agree that civil aviation should be subsidized in directions in which most benefit can be obtained. Increased grants should be made available to aero clubs, because they are rendering most useful service in promoting an air sense. The Government would be well advised to subsidize air services for the development of the outlying portions of Australia; but I contend that a mistake was made in subsidizing the east-west service, because in that case the aeroplanes fly parallel with the transcontinental railway, and save only about one day’s travelling time. The Government should hesitate about granting any subsidy at the present time for’ the purpose of linking up Australia and Great Britain by means of ah air service.. An offer has been made, I believe, by a Dutch company to extend its service to Australia, and to collect mails without a subsidy, but’ with a surcharge on mails carried’. If there is any possibility of establishing such a service without paying a subsidy, the experiment should be tried..
A .ser-io.us position in connexion with the shipping on the Austalian coast has arisen owing to the competition of an American line of steamers with our interstate fleet. The position has become so acute that it is time action was taken by the Government. I understand that the matter has received attention, but I have been unable to ascertain w’hat the Government’s intentions are. The American vessels that are trading to Australia are practically portion of a fleet that is heavily subsidized by the American Government. They call at both Sydney and Melbourne, and- pick up a lot of traffic between Australia, New Zealand, and Fiji, all of which are parts of the British Empire ; yet when a British vessel tries to trade on the coast of the United States of America, or between Honolulu and America, the law of the United States .of America intervenes. Sooner or later, the present Government will have to introduce legislation similar to that passed in New Zealand, under which American vessels can be prevented from carrying passengers between New Zealand and other British dominions. A newspaper recently pointed out that the Monterey and Mariposa, and the Lurline, the third of the trio now nearing completion, were built on a basis of a 75 per cent, government loan, repayable over 25 years, at a low rate of interest, stated to be li per cent. In addition, they receive a mail subsidy of 10 dollars a mile on the outward journey from San Francisco, which amounts on the two liners in service to more than £200,000 a year. British and other foreign ships carrying mail out of United .States ports are subjected to discrimination in the amount of mail poundage paid.
Tasmania is under a disadvantage through inability to induce steamship lines with large vessels to carry passengers between Tasmania and the mainland during the tourist season. A short time ago an attempt was made to get permission to carry passengers under these conditions, when it was found that arrangements had been made for. a large vessel to take tourists from Sydney .to Norfolk Island, and also to New Caledonia. It is reported in the Sydney Morning Herald to-day that the T’asmanian tourist officer at Sydney fears that so great has been die demand’ for tickets for these excursions that the tourist season of Tasmania is bound to be seriously affected. Tourists refuse to- travel on small vessels when large steamers are- available, and it seems that, if they can travel in comfort, they are even prepared to visit tourist resorts that have hot climates, rather than enjoy the cool conditions that Tasmania provides during the summer months.
– Tasmania should have a shipping line of its own.
– That might be considered, but we want the right to allow tourists to travel from the mainland’ to Tasmania in the large vessels that visit the- island State. Although we do not ask foi” special concessions, we contend that British passenger ships which trade to Tasmania should be allowed to carry passengers, thus helping to build up the tourist traffic that has meant so much to Tasmania in the past.
– Does the honorable senator insist on those vessels being manned under Australian conditions?
– “We merely ask that they should be British ships.
– I have no desire to delay the passage of this bill. There are, however, one or two matters to which I desire to direct attention. The bill before us is one of the most generous apologies that could have been offered to a defeated government by its successor. Should any honorable senator question that statement, I invite him to study the schedule to the document before us. In order to show how severely the Scullin Government was castigated by members of the present Government, because of its defence policy, I shall quote the words of the then Leader of the Opposition (Senator Pearce) who to-day is the Leader of the Government in this chamber. In his second-reading speech on the Supply Bill, No. 1, 1931-32, the right honorable senator said -
I notice a statement appearing in to-day’s press - I do not know whctlier.it is authoritative - that the Government contemplates reducing the expenditure on the Defence Forces by a further £250,000. Among other suggestions is one that the camps of training shall he suspended for the coming year. I hope that the Government will seriously consider the whole question before it further slashes the defence expenditure of this country. Even now, ovir defence ‘forces have boon cut to such an extent that they are practically on bedrock; if they are cut further our whole defence system will be a sham. I regard expenditure on defence as being in the nature of an insurance premium. A business concern which is in difficulties does not cut out its insurance premium, but retains it.
I know that I shall be told that everything is all right, and that Australia is in no danger. In support of that contention I shall be told, first, that Great Britain is still able to defend us. Australia has lived - I was about to say loafed - on Great Britain in the matter of defence for over 100 years. During that period the protection afforded by Great Britain has been sufficient; but I shall shaw that the time has come when we can no longer rely solely on Great Britain to protect us. I shall quote figures to prove that the British taxpayers are already bearing a heavier burden of taxa- lion than we in Australia are called upon to bear. In my opinion, it is a mean way of meeting our obligations to say that we are content to throw on the taxpayers of Great Britain the responsibility of providing for the defence of the whole Empire. Secondly, I shall he told that we can rely on the League of Nations to prevent war. That may be so. I sincerely hope that the League of Nations will be an effective instrument in preventing war: but I point out that one of the great factors contributing to war is the presence of armaments. Although the League, ever since it came into being, has devoted its attention towards the limitation of armaments, it has not accomplished anything effective in that direction.
Sitting suspended from 12 midnight till 12.45 a.m. Wednesday.
Wednesday, 9 November 1932
– The then Leader of the Opposition directed the attention of the Senate to the fact that the disarmament policy of the. League of Nations had up to that point failed. Has greater success attended the efforts of the League since that speech was delivered? At that stage, the right honorable gentleman directed the attention of the Senate to a publication which had been placed in the hands of all honorable senators - the Journal of the Parliaments of the Empire, for April, 1930 - containing figures which he said were most illuminating. In his conclusions the right honorable gentleman said -
Although Australia’s contribution to the defence of the Empire is greater than that made by any other dominion, it is by no means comparable with the burden resting upon the taxpayers of Great Britain. We ure not bearing, and have never borne, our fair share of Empire defence expenditure. I, therefore, suggest that it is unfair to Great Britain to make further economies in the defence vote, thus throwing an oven greater share of the burden upon Great Britain which, at the moment, is facing tremendous difficulties connected with unemployment, but nevertheless is determined to maintain the three arms of the service at their present strength. I earnestly hope that the Government will realize the dangerous position in which the Commonwealth will be placed if there is a further reduction in our Defence expenditure. I offer these remarks in no party spirit. I do not introduce the question of the attitude of the Government towards the reduction of defence expenditure, but I urge upon Ministers, i in view of the actual effect of the world’s policy, to hesitate before they diminish any further the efficiency of the small defence force we now have in Australia. [ could quote the remarks of Senator Pearce on subsequent occasions,’ and also those of Senator Payne, Senator Sampson and Senator Foll warning the Government of the seriousness of the position, and expressing the hope that if it were defeated the Defence vote, instead of being reduced, would he considerably increased. At that time, we believed that the criticisms of honorable senators in opposition were wrong. I still hold the belief which I then entertained, and I am particularly pleased that wiser counsels have prevailed in the ministerial party, and that its members can now see the justification for the defence policy of the Scullin Government. Frequent references were made to the action of that Government in dispensing with the compulsory training system. Have any steps been taken by our critics at that time to depart from the policy adopted by the Scullin Government?
– The They “picked a row “ with the pensioners.
– Yes, with the mothers and fathers of the Anzacs. Further, the Government sent a Minister to plead with the Anzacs to make a voluntary sacrifice in the matter of pensions.
– -If the Scullin Government had done its job there would not have been any need to reduce pensions.
– That is a remark such as one would expect from au honorable senator who had not studied the position prior to the Scullin Government assuming office. It cannot be denied that when that Government assumed office our financial position was in a most parlous state.
– And if took two years before attempting to remedy it.
– If the present Government were in power for nine years, and we were called upon to clean up the mess, it would take more than two years.
We were told that owing to the lack of confidence in the Government, men could not be provided with work. On the hoardings throughout South Australis’, and in the other States, particularly in New South Wales, one could see posters inducing the electors to vote for the United Australia Party candidates.
– What were the unemployment figures when the Scullin Go vernment assumed office, and when it was. defeated? Was there not an increase of over 200 per cent?
– The percentage was lower when it assumed office- but the honorable senator cannot deny that, although the Scullin Government was in office it was not in power. Every step taken by that Administration to ameliorate the conditions of the people met with a hostile reception in the Senate. Our banking policy, which constituted the only material difference between the policies of the two parties, was treated with contempt; but this Government has departed from that policy since it has been in power. What is the difference between the system of financing the country to-day and that in force when the Scullin Government was in office? At that time, the people were told that there was to be no political control over banking, that being the fundamental difference between the financial policy of this so-called great Austraiian party and the Labour party, and the people believed it; but .they learned only the other day that there has been political dictation in the matter of banking. One banking institution having advised a particular form of finance, the Assistant Treasurer (Senator Greene), in effect, called Mr. Stevens, the Premier of New South Wales, a liar, and that gentleman retorted by calling the Assistant Treasurer a liar or something worse. When the Scullin Government was in office the cry was “ Hands off the banks!”. We were told that there would never be confidence until the people disposed of the Government which wished to control the banks. What has happened since the present Government has been in power? The defence policy of the Scullin Government was the same as the defence policy of to-day. The unemployment policy of this Government is the same as that of its predecessor. The Standing Orders will not permit me to say how the previous Government was tricked out of office. The supporters of the present Government said nothing to the people about an interference with the rate of pensions. I have heard honorable senators say on several occasions that the Scullin Government was the first to reduce pensions.
I admit that it was.; but did the supporters of this .Government say that they were going to reduce pensions by another 2s. 6d. a week? Is it not a fact that, but for the possibility of a political crisis, invalid and old-age pensions would have been reduced 2s. 6d. a week all round? This Government proposed to introduce an iniquitous scheme, which I anl not permitted to discuss. The leader of the United Australia party told the electors that he would be guided by circumstances, but if he had told the invalid and old-age pensioners that he proposed to make another onslaught this Government would not have had a majority in this chamber or in another place.
The PRESIDENT (Senator the Hon. P. J. Lynch). - The honorable senator is aware that he is not entitled to discuss a measure which has already been disposed of by this .chamber,
– I merely said that if the leader of the United Australia Party had told the electors that he proposed to make another .onslaught on pensions, his party would not have been returned. The people were also told that it was not the intention .of the Government to make any .drastic alteration of the customs tariff. I am sorry .that the defeat of the Scullin Government was not delayed for a fortnight, because by that time the Senate would have disposed of the tariff and our support from the Chamber of Manufacturers would have been assured. This Government went to the country on a tariff policy which it has not since pursued. I sympathize with Ministers, because I have been in and out of a ministry, and I have seen what, in politics, is colloquially termed a “ spill “. Recently two Ministers left this Ministry, one because of its tariff policy, and the other for a reason which is well known to honorable senators. As the Government has the numbers, the Appropriation Rill will be passed, but it goes against my grain ito give this Government any appropriation because of the reversal of its attitude with respect to many matters for which it .condemned the previous Administration. It fought the Scullin Government on its defence policy and on its proposals for the relief of unemployment. To-day Ministers and their supporters are apologizing for their attitude towards these questions.
If they had any sense of decency they would leave the treasury .benches and allow the Government, which they ousted from office, to take their place. There has been the same reversal of policy with respect to banking, and we shall -have an opportunity to discuss its .tariff alterations when the Ottawa agreement is before the Senate. Also, I should like to see the Ministry and its supporters go back to their masters - the people - and attempt to defend what has been done with respect to invalid and old-age pensioners, and the manufacturers of this country. Have Ministers read a recent report which appeared in the Adelaide Advertiser of a meeting of the Federated Chamber of Manufactures convened to protest against the Ottawa agreement ? Is there any possibility of their enlightening the Senate, in the manner demanded by them, when in opposition, of ‘the Scullin Government with respect to its Central Reserve Bank Bill, by summoning to the bar of the Senate Mr. Oscar Seppelt or Mr. F. R. Lee, to ascertain what are .the objections of our manufacturers to the Ottawa agreement? Further, is there any possibility of a settlement of the differences between the Bank of New South Wales and the Government with reference to essential features of the Ottawa agreement, and will the Government allow the agreement to be referred to a select committee -so that we may have an opportunity to collect evidence, and examine the agreement entered into between Britain and Canada? Of course there is not the remotest possibility of any of these things being done. The Ottawa agreement will be adopted. Consequently the manufacturers of this country will be penalized, in the same way as our invalid and old-age pensioners have been penalized. Then when an appeal is made to the people, if the Labour movement will only solidify its ranks, there will be not the slightest danger of this Government being returned to office.
Senator HOARE (South Australia) (1.4 a.m.]. - I shall not detain the Senate for long at this early hour of the morning. The Labour party is certainly committed to the policy of protection, but, as Senator Daly has told us, the manufacturers of this country have been deceived by this Government. They deserve all that they have got and what may be coming to them, because of the support which they gave Vo candidates supporting this Ministry. On many Occasions during its term ‘of office the Scullin Government went out of its wiay to help our manufacturers, but lacking gratitude for assistance rendered, the manufacturers deserted that Government when an appeal was niade to the people. Now they are in difficulties. One firm ‘df which I have personal knowledge had good reason to tli’ank the Scullin Government for its help’; but, instead of doing the right thing by ite “employees; it took advantage of rae first opportunity to appeal to the Arbitration ‘Court to reduce their wages by 10 per cent. As the firm ill question, lifts had the advantage of absolutely prohibitive ‘duties, the judge, naturally,1 declined to vary the award. Although the Scullin Government was in office, it was not actually in power, because a hostile ‘Senate prevented it from giving full efi eci to its policy. Therefore, blame’should rest, not upon the Government, but Upon the ‘Senate.. Apparently ‘our manufacturers “are without gratitude. Although a government may db 99 things right, if the lOOth thing done does not quite meet with the approval of the persons interested, all the good which a government may have done is forgotten. In tllis . way “elections are won and lost. The Lyon’s Government bwes its accession to office tb the fact that it misled the electors. So effective was its propaganda that even good Labourites were to be seen on the election day handing but how-to-vote cards to’ intending “voters,, requesting them Vo vote ‘for candidates supporting the fcyons party. A special appeal was made to the. womenfolk to vote for candidates pledged to support the policy enunciated by Mr. Lyons, and thus ensure “work for their sons and for their husbands. Even the waterside workers in South Australia were misled, the Government^ candidate, when asked if he would stand behind the preference given to. the waterside workers by th’e Scullin Government, clearly indicated that the Lyons Government would not interfere with it. Because o’f that assurance he obtained considerable support which otherwise would h ave been withheld from him. On election ‘day I ‘asked one man whom I knew if he had done the right thing. “ Oh, yes,” he replied, “ I voted for Mr. Evans.” I then asked him what was wrOng with Mr. Norman Makin, and he said, “I voted for Mr. Evans because he belongs to the Lyons party, and we have been assured that there will be no interference with the waterside workers’ preference, and, moreover with a change of government the banks will make available credit for the employment of our people.” That was how the Scullin Government was defeated at the polls.
-Senator Dunn is the maii who claims credit for having defeated the Scullin Government.
– ‘That is true. The Sc’uiiiri Government owed it’s ‘defeat in Parliament to the hostile action taken in aii’oth’er place by the party to which Senator Dunn belongs, on th’e grouiid that money provided for the relief of the unemployed in New South Wales was being used to ‘enhance the chances of Mr. Theodore’s return foi1 the division Of Dalley.
Senator Hardy said he disapproved of the Government’s proposals to assist civil aviation, mentioning particularly the subsidies paid . to Qantas, Queensland, and the Westralian Airways Limited* The subsidy paid to the Westralian Airways Limited is £35,000 a year. I agree with Senator Hardy that the Government should not subsidize any aviation company which conducts services in active competition with the Commonwealth or State railways. Is it any wonder that railway services, competing under such unfair conditionsj are showing a. loss? This competition is especially severe -on the East- West line. The money would be spent t’o better advantage if the Government increased its subsidy for the sefvitfes conducted by the Australian Inland Mission, under the control of the Rev-. Joh-n Flynn-, which is providing rapid air transport for doctors to -outback areas in’ Central Australia. This humanitarian -and Christian undertaking is deserving pf the fullest support from all section’s of the people, and it is not competing with any existing -government utilities.
It is strange that honorable seMt’ofs should s’O ‘often forget that, ‘as a central Parliament, it is ‘Our duty ‘to legislate “for the whole of the people. Senator Johnston, from Western Australia, and Senator Foll, from Queensland, are protectionists when protection suits the State which they assist to represent in this chamber; in all other respects they are freetraders.
– I stand for a reduction of all duties.
– Nothing of the kind! The honorable senator believes in full protection for the farmers in his State. If the Government brought down a proposal to pay wheat-growers a bounty of ls. a bushel, Senator Johnston would give it his hearty support, because it would benefit his State ; but if it proposed to protect the banana-growers of Queensland he would oppose it, and would favour the free entry of Fiji bananas to Australia. On the other hand, when the subject is Queensland sugar, bananas, peanuts, or maize, Senator Foll argues that every protection possible should be afforded, because he represents that State; but in the case of New South Wales’ secondary industries he favours the removal of duties. He loses sight of the fact that New South Wales is as much a part of Australia as Queensland or any other State, and is entitled to as much protection. We should remember that we are Australians, and legislate for the benefit of the Australian people. Why plead, on the one hand, for protection for primary producers and, on the other hand, urge the removal of duties on galvanized iron, wire netting, and harvesters so as to cheapen the cost of those commodities for the benefit of the farmers? If it is right to protect primary producers, it is equally right to protect secondary, industries. The existing depression has resulted principally from the lowering of the purchasing power of the people. The other day I had a conversation with a gardener in Adelaide whose ideas are most conservative. I pointed out to him that a basket of assorted vegetables may be purchased in Adelaide to-day for ls. and asked whether he was receiving 6d. an hour for his labour. His reply was, “ Nothing of the kind.” I said to him, “You are always complaining that the Labour party improves the conditions of the people in the metropolitan area, although the action of raising wages and shortening hours increases their power to purchase your products.” His reply was, “ I can see now that I was wrong.” His son, who had just joined us, added, ‘” We have had enough of this mob; we are voting for your party on the next occasion.”
Senator Colebatch endeavoured to show what freetrade means to a nation. Until recently England had no protective barrier, yet her progress has not exceeded that of protectionist countries; rather has she slipped back, and in proportion to population has as many unemployed as any protectionist country in the world. I measure a country’s greatness, not by the wealth of the few, but by the prosperity of the many. England now realizes that if she is to hold her own and find employment for her people, she must follow the example of .Germany, the United States of America. and other countries. An interjection was made by one honorable senator concerning the brotherhood of man. If freetrade is to be the policy of the nations they must all fix a certain wage for their workers, whether they be white, black, brown, or brindle. If that were done, the white nations could safely remove all tariff harriers and more than hold their own with the coloured races. International gatherings such as the Ottawa Conference and the League of Nations must recognize that a nation like Australia can never establish manufactures if she allows free entry to the goods of other countries, because those whose workers receive only lod. a day would swamp her market with their products. If we are to build up secondary industries we must stand by our tariff. Much good could be done by bodies such as the Ottawa Conference and the League of Nations. I had very little faith in the League of Nations some years ago, but I now realize that many questions must be settled on an international basis, one of them being the hours of labour. We looked to science to relieve the burdens carried by humanity, but the introduction of machinery, which, by lightening labour, should have been a blessing to mankind, has been a curse, because throughout the civilized world it has displaced many thousands of workers. If the present tendency continues the time will arrive when scarcely any labour will be needed. At Port Adelaide, where I live, machinery was installed a little while ago along the waterfront and caused 400 men to lose their employment. Sooner or later, this question will have to be given the consideration that it deserves. The only solution is to reduce the hours of labour so that & greater number of men may be employed. If that were done by some international body the nations would not be in a position to compote unfairly against each other.
– We cannot have a uniform working week throughout Australia because of one State working against another.
– What is needed is a common industrial law. Governments are lengthening instead of shortening the hours of labour. An addition of four hours represents a reduction of 10 per cent, in the amount of employment offering. If the hours were lowered from 48 to 44 weekly, 110 men would be employed where the number to-day is 100. Sooner or later this action must be taken, whether the employing classes like it or not. Government is finance, and finance is government. If the people do not control their system of finance it will control them. That is what is happening in every part of the world to-day. There have been illustrations of it in this Parliament. Last year the banks would not support the proposal of the Scullin Government to guarantee 6d. a bushel to the wheat farmers and the Government had to climb down and limit the guarantee to 4-Jd. a bushel.
Only when the people assume control of the finances will they be able to govern themselves. England has no right to say to Australia that it shall not become a manufacturing nation. The more we import from overseas, the less will be the quantity of goods manufactured in this country, and the less will be the amount of employment provided for our own people. Great Britain has never given adequate preference to the dominions. It buys Russian wheat because it is cheaper than the Australian article.
– When our importations were reduced to a negligible quantity, our unemployment figures increased.
– I am pleased to have that interjection. In 1931, when the Scullin Government was in office, unemployment amounted to 28.3 per cent, in the third quarter, and 28 per cent, in the fourth quarter; but in the first quarter of 1932, when the present Government was in office, unemployment amounted to 28.3 per cent., and in the second quarter it was 29.6 per cent. Although the Prime Minister (Mr. Lyons) has stated on various occasions that Australia has “turned the corner”, I have shown a decided increase in the percentage of unemployment since this Government has been in office. Australia’s overseas indebtedness amounts to £599,136,012, and the internal debt totals £566,900,106. Our overseas interest bill is £28,427,331, and the internal interest bill £29,742,105, a total of over £58,000,000 per annum.
– It is more than that when the exchange is taken into consideration.
– Quite so; but even the sum that I have mentioned represents over £1,000,000 every week. Only abour. 1,000,000 persons in Australia are in employment, and how can they be expected to meet an annual interest burden of £58,000,000?
In my opinion, the exchange rate should be at par. Last year, the general taxpayers had to provide over £7,000,000 to meet exchange payments. The -farmers and their representatives regard the exchange premium as a remarkably beneficial factor; but they should not overlook the fact that the present exchange rate means an increased duty of 25 per cent, on everything that they import into this country. Farming machinery and other requisites are increased in price because of the exchange. Many farmers could easily do without the benefit of the exchange premium. It would pay the community better to provide a bounty on wheat than to meet the present high exchange rate. Farmers who have little or no crop receive no benefit from the exchange. I supported Senator Foll in an attempt made by him to induce the Government to provide for a wheat bounty according to the acreage sown, rather than, according to the quantity of wheat produced.
– That’ would he a more equitable arrangement.
– Undoubtedly, because the unfortunate farmer who failed to reap a crop, and was in much greater need of help than the farmer who reaped 40 bushels to the acre, would then be entitled to assistance; In the first place, the present Government decided not to grant a bounty on wheat, but I understand that it is nOW reconsidering its decision. I hope that it will grant a bounty rather than rely on assistance to the farming community by means of the exchange premium-.
.- -In the absence of the Minister in charge of the bill (Senator Greene), I feel it to be my duty to reply to some of the observations by honorable senators on both sides of the chamber. I do not intend to indulge in flights of fancy concerning the fauna or flora of this country, nor to deal with its discovery or geography. I shall also pass by as unworthy of comment that species of political propaganda which is frankly admitted to be engaged, in by certain honorable senators, we are considering the Estimates, and this provides honorable senators with an opportunity to express their opinions on. any matter that occurs to them. Honorable senators and the Minister in charge of the bill will have opportunities in committee to deal in detail with the matters which have been the subject of comment during this debate. I propose to mention only, one or two which I consider to be of major importance, and which have been stressed by the Leader and Deputy Leader of the Opposition. Senator Daly “spoke on the subject of defence, and as the Leader of the Government has already ‘taken part in this debate, he proposes to deal with that matter when the Estimates of the Defence Department -are being considered in -committee.
Criticism has been levelled against the vote for the Senate itself. I may say that, in the ‘opinion of the Australian people, this chamber baa more than earned the ‘amount *ha>t iis Set aside for its conduct and management. Never has the Senate stood higher in the eyes of the people than, it does now, as may be gauged by their decision at the last election when, in every State, except Queensland, where an unfortunate accident occurred - I do not think that it will be repeated - all the Senate seats were won by the party now in office. During its calamitous regime, the last Government, which neither knew its own mind nor made any definite attempt to get this country out of the impasse which it had reached, dallied and played with the master demon of New South Wales, who was leading this country to utter discredit and ruin, both internally and overseas. Whatever carping criticism may be offered concerning the present Government’s administration, the fact remains that Australia now stands higher than it has for many years in the opinion of the outside world and the financial authorities.
-So it should; we keep on paying the overseas moneylenders.
– I trust that the honorable senator1, who expressed the opinion that nations, like individuals, should live within their incomes, would not Approve of any action by the Australian people, other than an honest discharge of their liabilities.
On the subject of the ‘trade balance, I “should like to add a few words to the logical and common-sense views expressed by Senator Brennan. A comparison of imports and exports affords no criterion as to the ability of a country to meet its commitments. The only test of our capacity to pay - and here I am dealing with the suggestion made by Senator O’Halloran –is the credit to the account of the Australian Government with its central reserve bank in London. As pointed out by Senator Greene, although -the imports into this ‘country ‘are greater than our -exports, the credit to our account in London is some millions of pounds greater now than it was ‘-not long ago.
– Wha What about the influence of our account in London on the sale of -gold ?
– The honorable senator is -as agile as a -sparrow. The point that <he made in his speech was that a greater inflow of goods into Australia would imperil our financial relations with people overseas. The honorable senator quoted figures supplied by the Commonwealth Statistician, and these have been the subject of close analysis. If the honorable senator were
Tight in his contention, this Government could be accused of great negligence in the administration of the financial affairs of this country. Although I have not the figures before me up to the end of September, an analysis has been made of the statistics for July and August, when the Government was naturally watching the balance of imports and exports in order that it might preserve our credit overseas. According to official statistics, our imports for July and August of this year were £3,016,000 higher in value than in the same months last year, and of this amount, no less than £2,325,000, or about four-fifths of the total, was spent in the purchase of plant, machinery, and raw material to be used in manufactures in Australia. Take the figures relating to dyes, drugs, chemicals, fertilizers, motor chassis, metals, oils and fats, and consider what they connote in regard to Australian secondary industries.
– W - What a grand country we shall build up by importing oils and fats !
– Those goods were imported because people needed them, and probably because capital had been taken out of -this country during a period when confidence was lacking. At that time there was no confidence in the Administration, of the ‘Commonwealth, and less confidence in that of New South Wales. Capital was being returned in the only way possible - by means of goods. In my opinion, this is the best indication of the -return of better times -that we have had, small though the improvement may be. The Deputy Leader of the Opposition (Senator O’Halloran) expressed anxiety on this subject, but I assure him tha.t there has been no depletion of our . cash resources on the other side of the world.
SenatorO’Halloran. - There has been a considerable increase in the importation of manufactured goods.
– Even so, they are not paid for ‘to the detriment of this country. The honorable senator’s criticism was that the Government was imperilling the position of the Commonwealth finances overseas. I have shown that that is not so. In the interests of the Australian people I wish to make it plain that there is no danger to Australia. The Government is watching the position carefully.
Pointed reference was made by Senator Colebatch to the position with regard to sheet glass. The position is difficult, and at first sight it might appear that the Administration has been lax. I shall give the facts as I understand them. Plain, clear, sheet glass was dutiable at 1½d. per foot, and while that duty was in force a good deal of glass was admitted under by-law, because the Australian manufacturers were unable to make their plant and equipment function satisfactorily. The matter was referred to the Tariff Board, and on the 2nd September, at which time the Australian company was not able to supply requirements, the duty was reduced to 2s. British, . and 4s. general, per 100 feet of glass, with a deferred duty of 40 pgr cent, and 60 per cent, ad valorem respectively, from the 1st December. Although deferred duty was provided because machinery costing many thousands of pounds had been installed, it was not working satisfactorily, and consequently, orders could not be fulfilled. Since the conduct of the company was entirely -unsatisfactory, aconstant watch was kept on the production of this glass, and from time -to itime, reports were made on the matter. Although not working, the plant was expected to function satisfactorily at any time. When the Tariff Board’s report was issued, there was something in the nature of an outcry, and on the 23rd September, in consequence of certain facts which came under the notice of the department, action was taken along the lines indica-tedby Senator -Colebatch.
– What were the facts ?
– I shall give them presently. Each year., Australian purchasers buy from 4,000,000 to 6,000,000 feet of glass. Australian merchants, being short of supplies, gave orders for the importation of 3,500,000 feet of glass. The statement of the glass manufacturers that they were producing glass is borne out by the fact that the company now has a considerable supply of glass on hand. The officer iu charge of the investigation reported on several occasions that at any time the plant might prove satisfactory, and for that reason a deferred duty was imposed. The Tariff Board, which brought in the report that I have mentioned, stated that the company had been experimenting for months in the manufacture of this class of glass. The company claimed that the difficulties had been overcome, and the customs officer reported that it was producing 50,000 square feet of glass a week, and could produce four times that quantity if there was a market for the material. In order to meet the position, the Government decided to impose a temporary prohibition, pending an inquiry by the Tariff Board. lt had been reported that otherwise men would be thrown out of employment, and the Government did not want that to happen. With 3,500,000 square feet of glass coming forward, and the Australian company producing glass, the Minister had no alternative but to refer the matter back to the Tariff Board, which body is now considering it. In the meantime he took steps to protect the industry in the way that the Tariff Board would have protected it had the company been able to produce glass in the first instance. The company has been informed of the decision of the Government with, respect to those who have ordered glass from overseas. The company is not altogether free from blame, as I understand it has created a good deal of uncertainty in the minds of its own customers, who have experienced considerable delay in having their orders completed. I understand that the Minister for Trade and Customs (Mr. Gullett) said in another place that it has been most unbusinesslike and slipshod in its methods, and that no injustice would be done to bona fide importers of glass. Consequently, importations were rationed, as Senator Colebatch has pointed out.
– Surely that is an injustice !
– They can obtain supplies. About 1,000,000 feet is to be admitted forthwith, and a further 1,000,000 feet is to be made available when it is required. One cannot blame the importers for ordering what is practically a year’s supply between the two dates in December which I have mentioned. Probably they were guided to adopt the course they followed by what has taken place in the past; but I can assure honorable senators that it is the desire of the Government to hold the scales evenly between the interests concerned.
– Is it a fact that the works are again closed down ?
– I heard only this evening that that is so.
– For eight weeks?
– I understand that the company proposes to close down its furnace for eight weeks, but it has 220,000 feet of glass in stock, which clearly establishes the fact that it is able to produce glass in commercial quantities. I understand that the plant is closing down for cleaning or reconditioning purposes, as is done periodically with all similar plants. I can assure honorable senators quite frankly that the position is difficult; but the Government is doing its best to protect all interests.
– How does the company’s price compare with the imported price?
– The officers of the department say that. it compares favorably. I understand that it is a shade lower.
– If the company is to continue playing these tricks, it should suffer, and not’ the importers.
– I am inclined to think that, if the trouble continues, the responsibility will have to be placed upon the company. This situation came a3 a thunderbolt to the Government. The Tariff Board said, “This work cannot be done,” and, although the officer of the department said that it appeared as if it could be done, -the company from day to day failed to produce the goods. Then the importers arranged to bring in a tremendous quantity of glass, which would have made it impossible for the company to engage in production for another twelve months.
– Is it not a fact that the company imported a huge quantity of glass, and then asked the Government to impose an embargo on further importations ?
– That was done in the days when things were done in that way.
– It was not done while the Scullin Government was in power.
– There was a suggestion to that effect. The Government will watch the position very closely.
-Hughes. - Is not the consumer considered at all in this matter?
– A supply of about 2,000,000 feet is to be made available almost immediately, and another 1,500,000 feet will be made available at the discretion of the Government.
– Does the Minister think that it is the function of the Government to control trade in that way?
– I do not think that it is. The Government wa3 obliged to act on the recommendation of the Tariff Board. But we immediately found, if the statement of the company and . of the departmental officer was true, that the report of the board was based on something which was wrong. This company has spent from £300,000 to £400,000 on a factory in which it was prepared to produce glass at a price equivalent to the imported article, and it was the responsibility of the Government to try to protect the industry. The Government will do its best to deal justly with those who have imported large quantities of glass in good faith, believing that they were entitled to do so until December, when the deferred duties became operative.
– Is this case typical of others?
– I am fortunately not familiar with the ramifications of the Customs Department ; but I have submitted the facts as supplied by the department.
– The Government should have carried put the Scullin Government’s policy.
– We should have carried it outside and left it there.
Senator Colebatch also referred to the increased cost of the Patents Department as compared with the time when it was administered by the State goverments. When the Patents Department was administered by the State authorities the control was partially vested in other departments. For instance, in South Australia it was under the control of the Solicitor of Titles, the late Mr. F. F. Turner, who was also Commissioner of Patents. The two offices were combined, and the cost of the patents work was met by the Titles Office. A comparison of the cost in such circumstances is somewhat difficult. Moreover, the honorable senator based his comparison on the year 1904, when patents were not controlled by the Commonwealth throughout the whole year. If the honorable senator had made a comparison for a subsequent year the difference in cost would not be so great. An examination of the figures will show that the working cost - £6 13s. an application - is almost the same in the Commonwealth as it is in Great Britain. The expenditure has grown from £1,518 for the portion of the year when the Commonwealth assumed control of patents to approximately £54,000 ; but during the last two years the department has shown a profit. In view of the extensive nature of the investigations to be made, particularly in the matter of overseas patents, I do not think that it can be said that the cost is high.
– My complaint is that the department tries to do too much.
– The . cost could, be reduced, but I do not think it would be wise to fall behind the standards of other countries. It would not be fair to patentees in Australia. If any comparison is made it should not be based on a part of a year. At present the Patents Office is earning more than it is costing.
– That will not be the case when the department is removed to Canberra.
-I understand that when the transfer is made, there will be a considerable saving in the matter of rent. While I agree with the honorable senator that it will be more costly for patent attorneys to conduct their business, it will benefit the profession of which the honorable senator and I are members.
It is not my intention to deal with the other subjects mentioned by honorable senators. The vital question at the moment is finance and the restoration of confidence which we believe is already assured. We earnestly hope that relief can be given to the taxpayers, and that work will be provided for the thousands of unemployed concerning whom honorable senators opposite speak so sympathetically, but in respect of whose future they have nothing practical to offer us, except dreary meanderings, and the suggested application of those doctrines which have proved false in the past, and which Mr. Winston Churchill described as the dreary doctrines of Karl Marx.
Senator DOOLEY (New South Wales) [2.12 a,m.” . - It is not my intention to detain the Senate very long, but there are one or two matters which I wish to bring under the notice of the Government. We have been told, that its main object is to restore confidence, and to reduce expenditure, but the only way in which it has reduced expenditure has been by cutting the wages of the working class, and depriving pensioners of a portion of their already small income.
As I understand the Government intends to proceed with certain public works, I should like to know whether it does not consider it wise to re-appoint a public works committee to investigate the works it proposes to undertake. The Assistant Treasurer stated the other day that a large sum of money is to be spent on public works. For instance, I understand that a reservoir is to be constructed by contract on Black Mountain in the Federal Capital Terri.tory, and if that is so, the Government, should arrange for some investigation to be made before the work is undertaken. All works, the estimated cost of which is £30,000 or over, should be inquired into by a public works committee. The Government should consider the advisability of retaining this committee, and perhaps also, the Public Accounts Committee, although I am not so conversant with the work done by that body.
– I understand that provision is being made in a bill now before another place to cover the matter referred to by the honorable senator.
– I was aware that it was under consideration in another place, and I think the Government would be wise to give favorable consideration to my request.
The other bone of contention with me is the Government’s attitude to our invalid and old-age pensioners. I again appeal to the Ministry to show to them the consideration given, to other classes of pensioners. These pension payments are not in any sense a charity, and they should not be treated as such by any government. Under recent legislation passed through this Parliament, assistance given by sons or daughters of pensioners will affect the amount of pension paid. Every one will agree that it is impossible for any person to live in decency on 17s. 6d. a week, yet in many cases the pension will be cut down to 15s. It is natural for children to assist aged parents if it is within their means to do so, and it is unfair to penalize pensioners if they get a little help from their children. Those who have been thrifty, and have acquired a little cottage for themselves in their old-age should be able to pass it on to their children, but under the amending provisions recently inserted in the Financial Emergency Act, upon the death of a pensioner any property so acquired becomes a first charge against pension payments. That also applies to an insurance policy. This was never intended by those who were responsible for the introduction of the original measure. At the last election candidates of the United Australia Party claimed credit for the establishment of the system of invalid and old-age pensions and attacked the Scullin Government for having reduced the payment from £1 a week to 17s. 6d. It is well known to all that the action taken by the Scullin Government was the only honorable course open to it, in view of the grave financial position of the country at the time. The circumstances to-day are different. When the financial bill was before the Senate recently I deplored the decision of the
Government to reduce pension payments to 15s. a week in certain cases. I still hope that it will give this important matter further consideration and see what can be done to restore the full pensions to our people.
There is just another matter which may appear trivial to some honorable senators. In my view it is not trifling. I refer to recent reports of the destruction of emus in Western Australia by members of the defence forces using Lewis guns, lt was stated a day or two ago that no fewer than 2,000 rounds of ammunition had been used to destroy 200 emus, and that the cost worked out at 10s. a head. If the Government paid 2s. a head for the destruction of emus a few country men armed with rifles would do all that is required.
– As the farmers are paying for the service rendered, we must presume that they know their own business best.
– I was unaware that the farmers interested were defraying the cost. Nevertheless I still think that, if the Government offered a few shillings a head for a destruction of emus the work would be done more effectively by means other, than the use of members of the Defence Forces armed with machine guns.
Question resolved in the affirmative.
Bill read a first time.
[2.22 a.m.]. - I move -
That the bill be now read a second time.
A full statement of the accounts embodied in this bill was made when the budget papers were laid on the table of the Senate and we then had a discussion on the main principles of the measure. I therefore do not propose to make any further observations at this stage. I shall have something to Bay when we come to the defence estimates, and other Ministers representing Ministers in another place will also offer explanations of the various items of expenditure to which attention may be directed. I appeal to the Senate to allow the second reading to pass so that we may come to the first item and then suspend the sitting until a later hour of the day.
Question resolved in the affirmative.
Bill read a Becond time.
Clause 1 agreed to.
Clauses 2 to 4 postponed.
First schedule agreed to.
Motion (by Senator Sir George
Pearce) proposed -
That the Senate, at its rising, adjourn until this day at 10 a.m.
– What is the reason for reassembling at 10 a.m.?
– So that Ministers may supply information to honorable senators with respect to any items in the schedule to the Appropriation Bill. As Supply is exhausted, it is essential that the bill should be sent away by to-morrow night’s train.
– Surely we could pass another Supply Bill.
– That would involve delay because it would be necessary to pass the bill through another place.
– Nevertheless, I protest. The Ministry should provide a better reason for the quick despatch of this measure,it is unreasonable to ask honorable senators to re-assemble at 10 o’clock.
Question resolved in the affirmative.
Senate adjourned at 2.30 a.m. (Wednesday).
Cite as: Australia, Senate, Debates, 8 November 1932, viewed 22 October 2017, <http://historichansard.net/senate/1932/19321108_senate_13_136/>.