FOR MEDIA WEDNESDAY, 17 JUNE 1982
ADDRESS TO ROTARY CLUB DINNER, CAMDEN
It has been a busy day, but it has been an enjoyable one
in a wonderful part of Australia. I am delighted that
you have asked me to speak to you in this combined dinnermeeting,
because Rotarians epitomise so much of what is good
in Australia, so much of what makes all of us I believe,
very proud to be Australian. It not only promotes goodwill
within its own communities, but what Rotarians do helps to
build a nation, to improve on its own community, but then that
reaches out beyond the boundaries of Australia to try and
extend understanding and goodwill with people from other
countries. There are Rotary exchange students here this evening,
and the programes that Rotary pursues year by year are of
enormous value and I would like to thank you for the work that
you do.
I would like to speak for a few moments about where Australia
is going, about some of the problems that we have within the
Australian economy, some of the concerns that we have for
Australian security, About one or two of the things that we
sometimes do to damage ourselves when we do not work together
well enough and when we spend perhaps too much time arguing
about different directions or ways of doing things instead
of getting on with the job of building Australia up.
Over recent years we have had some success in economic terms.
We have moved very much against the international tide-we
know we have! problems here of employment and inflation
but this economy has been growing. The real household
disposable incomes of Australian families have been rising
and it is possible to draw some comparisons between the sorts
of things that have been happening here, in the United States
or in Europe. The motor industry in the last 12 months has
had an all time record year in Australia. In the United States
it has had -just about the worst year it has ever had, because instead
of producing what they regard as normal, something like 14 or
million automobiles, they have produced about 8 million
automobiles.. You start to measure the difference in terms
of the number of people employed, the level of unemployment
in Detroit, and. obviously the harm that does is enormous.
It not only affects the United States or the autombile
workers, a 41reat deal less steel is needed, Iess coal and less
iron ore are needed, so a reduction of that size in one industry
alone is enough to affect the international markets of coal and
iron ore. rhat starts to affect us and this region which is
very dependent upon coal for much of its employment and its
well-being. ./ 2
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In Europe we find that unemployment in a number of countries
is around 10% and up to 12%. In the OECD countries unemployment
is forecast, and it will indeed, reach 30 million people this
year. The prospects of, that level of unemployment coming down
rapidly in a short time are not with us. It shows how the
world changes, as I mentioned earlier that if you asked the
major Western world leaders 10 or 15 years ago: " could
unemployment ever again reach 30 million people amongst
advanced Western counties, industrialised countries?", they
would have said: " no, it cannot happen, we know much better
how to run our economies than that. It is not possible."
Well, unfortunately, it is not only possible, but it has
in fact happened. One of the things that concerns me very
considerably is the fact that I do not really see at this
point the kind of action being taken on the world stage that
is going to get substantial growth back into those major
economies which are so important if world trade is to grow
and expand. That is very important for us because 30% of what
Australia produces of Australia's Gross Domestic Product, to
use economist jargon, is represented by trade, and we live by
what we can sell to markets overseas. Again in this part of-
New South Wales you feel the effects of that in reduced demands
for coal, -ard greater difficulties for coal companies and it
is all part of the world scene.
In six of the seven major economies over the last 12 months
they have in fact produced less than they had the year before
in the last recorded figures. in the United States, Canada,
Japan, Britain, France and Germany. That is not very
encouraging because we all want better living standards, people
want more do'llars, more real dollars not inflated dollars in
their pockets so that they can do more for themselves and their
families. Most people want governments to do more whether it
roads, schools or hospitals, or other kinds of services or
in better directed welfare for needy or elderly people, and tha~ t
can only come out of what a nation produces. Governinnent's
do not have some bountiful chest that they can dip into, all
goverment's can do unfortunately, is to dip into people's pockEts.
Wle are told everyday that Ine do too much of that, ' and I notice!
a few ' hear hear's' around the table. I agree that government's
dip too much into my pockets and everyone elses, but the services
that people expect from governments have to be paid for and if
governments don't take from people, there is no way else it cart
be paid. Local government wants more from us, I hope they
do not ask t: hat 2% of income tax to be increased because I do
not think that we could afford to increase it. State governments
will want* more from us. We will be having a meeting with
Premiers in a short time, I hope it can be an amicable, friendl~ y
meeting and I am going to do my best.
There was an occasion when one Premier said interest rates are
too high I move that we move interest rates down We said
that is fine, we will move that interest rates come down 2%
but how are we apoing to put it into affect. Do you think you
are going to get any money for your electricity authority?
Do you think you will be able to raise any money for your
semi-governent authorities at all? If we just move the
Government rate down, other people have to follow, but they
might not follow, they might send their money overseas, or they ./ 3
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might lend it to private enterprise and you might end up with
no money at all. Well there were not any other Premiers
who thought that you could just move that interest rates come
down 2% and who really believed that that would happen. I
suppose these are stories out of school, but on one occasion
I asked Premiers whether they thought that high interest rates w~ ere
caused by the demand for funds or by a bunch of crooks out on
the market. Obviously if it was going to be a bunch of crooks
out on the market we should be taking some action to stop it.
But the answer I got was a silence, because they know it was
demand and if you want to reduce demand it might mean less
money for Premiers. In the kindest possible way I have never
yet met a Premier who did not believe that the Commonwealth ought
to provide more money for everything which a State does. We
have not got any money that we do not take from you and I much
prefer to have a situation in which the Premiers-had to ask.
you quite directly instead of through me or through John Howard.
If I could establish that kind of system I would love to do
it, I think it would be a much better one and the Commonwealth
could just stand aside and say to the Premiers: " well you
go to it with your own citizens", and the results might be quite
different.
We are concerned about the state of the world economy and as
a result of that we did propose a number of things which we
believe the major economies could do, could set a lead, at
the meeting that was recently held in Versailles. There were
some things in the communique which pleased us, they condemned
protectionism, they said that we had to get economies moving
and growing again. I do not really believe that that conference
achieved as much as anyone would have wanted, but there will be
a GATT-Ministerial meeting held later this year which will be
very important we believe, in determining whether world trade
starts growing again or not.
The things that we suggested at the meeting I do not believe,
should have been all that difficult. We had suggested that all
countries commit themselves to no further increases in
protection, to just leave it where'it is as a first step. Now
that would be a difficult thing to do, one country by itself, but
if the major economies were prepared to do it other countries
would be able to follow.
We had also suggested that there ought to be steady reductions
in protecticon over the next five years by a formula, by a set
amount to bE! agreed. Again that is not sanethir'ig ' that any one
country acting alone ccid but it is something that countries
acting in concert would be able to encompass. We had also
suggested that export subsidies should, over a period, be
abolished, because I think one of the silliest things of all is
that one countries start subsidising its exports, and therefore:
another country can give their own exporters an equal go when the
first country starts subsidising its exports, and it is just
a competitive subsidy business. It really is wasted resources
which could be better used in other ways. If nobody was subsid~ ising
their exports, nobody would need to subsidise their exports, the
people that could do it best would be able to be successful. / 4
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My Government: believes that a country like Australia could.
do * these sorts of things, if the major economics also were,
but we also believe very firmly that we cannot and could not
take unilate: eal action. There are sometimes economic writers
w'ho say: " iet doesn't matter what countries overseas do,
protection in Australia is too high and it must
come down." Well that is all very well, but there is not much
point in brin2ging protection down in this country which in
the very difficult world trading conditions we are now facing,
it certainly means that more overseas-made goods could come into
Australia, some of them at dumpted prices whichare very
difficult to prove because in many cases of marginal costing
and all the rest, there are some countries that are prepared
to export to keep their factories or steel industries operating
even if they are selling at a loss, and it is not always easy
to prove the dumping proposition.
If a country like Australia acted alone to reduce whatever
protection we had, and did it in an environment where we
were not going to get better access to markets overseas for
the things we could do best, then that is just like stripping
yourself naked in the middle of the street, it really is,
and I think it would be the utmost foolishness because we
have hard and fast quantitative restrictions against maybe
30%-35% of our exports and there is no way we can export
more of those things to the countries that have those restrictions
against us unless they lift those quantitative barriers.
Only six weeks ago
our market in the United States for sugar was cut from
admittedly a record of 800,000 tonnes last year to something
between 150,000 and 200,000 tonnes in this coming year.
That is a pretty fair reduction. The Administration opposed. it
but it went through Congress nonetheless, and I am told that
there are a hundred protection bills before the United States
Congress. I have not got any doubt'at all that there would
be more than. one that would affect Australia's exports to the
United States and the imbalance in our trade with the United States
on a pro-rata per capita basis is much worse than their
imbalance with Japan. I have been watching the arguments they
have been using against Japan to try and get a better balance
between those two because we can turn the arguments around
and use them all against the United States, and that. is a country
that is friEndly to Australia. So the trade scene is difficult,
the Government has to argue for access to markets around the
world. We have to do what we can to be competitive, and this is,
where we sometimes do much more damage than we should to ourselves.
Two years ago we would have been pretty competitive on the
world scene, but the economy was gxowing fast, employment was
rising strongly, it had risen up to 400,000 over three years.
There was not another industrial country that. could point to
the same record. So everyone immediately starts to want a
piece of this action, it means that wages can be higher, work
less and have reduced hours and enjoy it all. As a result
of that we have a situation where wages in the last year
have gone up something like 15%-20% in real terms, and on
some figures by more than that. We have a situation where
people are now in many industries working less, but because
there has been real recession overseas, they have been getting wrage
settlements of around and they have become more competitive
and we are finding that there are more imported goods coming
into the country and we are finding it much harder to sell
Australian goods overseas.
The industrial disputes, the wages difficulties that we have
had over the last 12 months have really made it difficult and
the people that are going to be hurt are the people who do
not have jobs or the people who are going to lose jobs.
There are many manufacturing industries in this country right at
the very moment, there have been for the last 2 months, there are
one or two who talk about it, and others just gc, about doing it,
they have their unprofitable lines of production and they
rub them out and every time they do that it means that they
employ some less. The national wage case was helpful, it
gave no further general increase w. hich gives us some time to
digest the excessive increases of last year.
In industrial relations there are far too many disputes and
I spoke earlier today about the problems in the coal industry
and the harm', it does Australia as a reliable supplier to
markets over-seas. But in industry after industry, there have
been industrial disruption and difficulty and I do not think
that there i~ s any one cause of it. Ian Macphee is working
very hard to establish a better climate. There will be a
tripartite conf erence between the ACTU, employers organisations
and governments in two or three weeks time in Canberra and I
hope that out of that there ? will emerge a firm understanding
that these are not groups that are competitive in terms of
their re~ l interests, they are groups that are complementary
in terms of their real interests.
People are not going to be employed unless businesses can make
prof its and if businesses are making losses, then it is not a time!
to be pressing: for higher and higher wages because that would
lead to more unemployment. If the trade union movement really
understands where its real interests lie they would be wanting
industry in Australia to make more and more profits, because
the more profitable Australian industry is the better wages
they can pay and the more people they can employ. What we needl
to understand in this country to a much greater extent, is that
as Australians we have complementary interests, our real
interests are not competitive at all. We need to build'on
Australia's strength in the skills that we have. We have
vast natural resources, rural resources, capacities in
manufacturing, but the real resources ace the resources of
Australian people who now come from nearly every continent
and nearly eavery',. nation around the world.
I can recall sometime last year I gave a reception in Sydney
for ethnic leaders in and around
Sydney and over 50 nations were represented. Now for those
of us who can, and I can, . just remember back before the world
war, that would not have happened, it could not have
happened, we were not that kind of nation. We were narrower,
smaller, our population had come from very few countries at
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that time., very much Ango-Saxon, but now we are very much
a multi-cultural society with people born in every continent
of every natiLon and I believe, we are a better and I hope
a wiser and maore tolerant society, as a consequence.
We live in an uncertain world. Britain's experience in the
Falklands shows that very clearly. Nobody believed, nobody
had predicted that the ArgentinOe military leadership would
invade the Falklands which had been under the British flag
for about 140-150 years. While the purpose of foreign
policy and the purpose of defence policy is to operate in
concert to make sure that dangers do not arise, I do not
believe that anyone can guarantee that events cannot occur
that might cause real difficulty.
That means two things. It means that we-need to do what we
can on our own account to improve our own defences to make
sure that we have the best and most modern equipment which
is possible for our defence forces. I am delighted to see
that the retiring Chairman of the Chief of Defence Force
Staff, Admiral Synott, said on his retirement, that we have
the best equipped and the best trained force that we had
ever had in peacetime. I believe that to be an accurate
statement. I mentioned -earlier today that Jim Killen made a statement
three or four weeks ago and every newspaper in the country
had massive headlines defence spending slashed. They
did this because-we brought forward, to the newspapers nind
but they had not understood, that we had brought forward
two major items in the defence program the purchase of
Invincible, -which Ihope the British will still want to sellit
has been a very effective ship and the Harriers have also
been very effective in the Falklands in giving support for
the army and also the purchase of another squadron of maritime
reconnaissance aircraft to get in on the current United States
production run, because if we had not done that, we would have
had to pay a lot more for the same aircraft at some later
point. Bringing forward two major items of equipment which
together would total several hundred million dollars, we
obviously have to increase the vote enormously now, or reshape
other expenditures and expenditures were reshcheduled. So
the papers came out and said defence spending cut well
in fact it was up 19% in money terms, 9%-10% in real terms
and if anyone went along to their employer and said I have
just had a 19% increase in wages and I regard that as a cut and
I am therefore very discontented, I do not think they would
get much of a. response from their employer. That is part of the
problems of communication that Governments are told they always
have. We not only need to do what we can on our own account, we
also need to. be a reliable ally, because I really do believe
that the vast majority of Australians are a committed nation,
committed to democracy, committed to a free way of life,
committed to a free and open society, which we believe creates
the best country in the world to live in and to br'ing up our
children and families. If we do belisve in these things
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then we have to work, as I believe, with our traditional
friLends and allies, whether it is with Britain with whom there
are no formal links because the roots of tradition and f riendship?
are sufficiently strong, or with the United States where
there is a formal alliance which canmits usto consult in time
of danger, but which commits us also inth-e normal course of
events to do what we can separately and jointly, acting
together to prevent a time of danger ever arising.
I hope you won't regard me as being too political if I say
something Iwastold that I could and should be provocative
tonight to say something about ships, because one of the
things that has happened over the last 10 years is that we
have had over 500 visits from United States, United Kingdom
and some French Naval ships. Now these are all nuclear
weapon states, they are all within the Western Alliance.
The United States, is with New Zealand with us, in ANZUS,
and it is not possible to say which of those ships are going
to be carrying nuclear weapons and which are not because
that would obviously be enormously important information for
any potential enemy. Enormously important information for the
Soviet Union and they would give their eye teeth to have that
kind of information, to be able to pinpoint which British
which American and French ships were carrying nuclear weapons
and which were not. Therefore, they just don't say, and they
won't say. I. If an Australian Government is to come along
and say we will only have the ships in our harbours and ports
that don't carry nuclear weapons, then in those circumstances
there would be no ships from those countries visiting our
ports. They need access to our ports for replenishment, for
repair, for rest and recuperation for sailors who have been
on patrol for upwards of six months at a time in the Indian
Ocean.-If in peacetime we can say to friends and allies:
" I am sorry you cannot even visit our ports", then I think
we would be a pretty lousy ally, and I think we would be
regarded as a lousy ally and we would not have an Alliance.
It is worth noting in spite of a lot of-the talk that has gone on
that up until recently there has been a great deal of bipatrtisanship
in relation to this policy because of the 500 visits that I
mentioned, it large number of them occurred when Mr Whitlam was
Prime Minist~ er. He accepted obsolutely the principle which
I have just enunciated and we also say that a large number
of those ships have also visited Sydney Harbour during the
time Mr Wran has been Premier, and neither I nor Mr Wran
has known which of those ships has had nuclear weapons on
board and which have not. I regret that this element of
bipartisanship in Australia's defence and foreign policy is
under threat right at the present time.
There is one other thing that I would like to say. Australia
is a relatively small nation of 15 million, but in so many
areas Australians have reached the very top in their professions,
and skills. Whether it is in the arts, opera or in ballet,
medical research or in the various sports in which Australians
have done so well in many forums around the world. There. are
many of our countrymen who have done great things in which
we can take great pride. Australians have always sought to do 18
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the very best in their own particular field of endeavour. This
is-something which I believe gives us all great cause for pride
in being Australian.
I would like to thank all of you as Rotarians and friends
of Rotarians for what you are doing to build a better
Australia, for what you are doing to build up your own
communities. 3ecause it is those kind of actions, the kinds of
ideals that Rkotary has, that makes this country what it is,
which makes this country as I very fervently believe, the best
country in the world.