SPEECH BY THE PRIME MINIST...' THE RT. HON. R. G.
MENZIJLS AT CAANN -AU3TRAL I4IN LUNCHEON, NE.!
Y0iu( 6TH_ JU 196o
Sir, having listened to you, having listened to Tom,
having collected a little of the atmosphere, I want to say what
a pleasure it is for a practising politician to find himself in
such a completely non-political atmosphere.
Governor Dewey made some very pleasant remarks about
me. I just want to say to you that I'm glad thiat he did, because
I feel t:' at he owes those remarks to me. In 1948, ihen I shared
the gift of false prophesy with Roy Howard and all of the
thousands and thousands of people who wrote to his orders, I went
all the way at my own expense from New York to Syracuse to hear
Tom Dewey at a railway station, And having heard him, I went
all the way back to New York quite satisfied t'aat he was going
to win. . Jhich goes to shnw, doesn't it, what extraordinary
results can happen in a country like the United States, so
backward as not to have compulsory voting.
But it really is the most fascinating thing in the
world for a man who comes from a country where politics is conducted,
as you know, with a high courtesy, never a rude remark,
never an ugly thought or a hard word, to come over here in a
presidential election year, And of course I should love to be
able to tell all of you who will be on the ticket when the vote
comes. I've had it right from the horse's mouth, or rather I
should say, right from the mouths of horses. I know of at least
three absolute stone certainties for the Democratic nomination;
and as for the vice-president, wel, permutations and combinations
couldn't go far enough to e ' Vlain how many people are
undoubtedly certain to be chosen,
I am sorry I can't wait long enough to attend one of
these conventions of yours t-sit in the gallery and listen to
the brass band. Because really in 1948, having gone up north to
listen to Tom, having gone out to Indianapolis to listen to Mr.
Truman, having got back to New York and being about to go back
to London to pick up my wife and daughter, I paid $ 2o50 ( did I
ever tell you about this?) to go to Madison Square Garden and
hear Henry Uallace. It cost me about a hundred dollars to hear
Tom Dewey; about two hundred dollars to hear Harry Truman and
$ 2.50 to hear Henry J. allace. And it was a great night a
wonderful night. There were bands, there were people who gave
a very goci imitation of the Andrew Sisteis, crooning int a
microphone. Paul Robeson was in the chair and he sang his opening
speech to the tune of Old Man River that was worth the
$ 2.50 in itself and then Henry came out with the spotlight,
and a lock of hair and he made a policy speech. Ten minutes
consisted of four sentences interspersed with the most tremendous
volume of applause and the rustling of five-dollar bills as they
fell into the collection bags. I went home writh my mouth
watering. I began to work out what I might have been worth ' t
the same sort of tariff.
But I remember that the fourth sentence of this speech
consisted of these words: "' Je stand for light, not darkness."
Now that's a very good cbservation. And as my old lawryer's
instinct asserted itself I thought I would love to get some
further and better particulars of what that might mean. So as we
walked out into the great peace of the starry night, out of
Madison Square Gardens, I spoke to a neighbour who was walking
out, and I said to him with my most courteous manner: " Excuse me
sir, I'm a foreigner here, I wonder if you could help me. Now
when Mr. dallace said that he stood for light, not darkness,
was he adumbrating possibly the nationalization of the gas light
industry?". And my neighbour looked at me with that contempt
that is reserved for foreigners, and he said: " Say, it's easily
seen you are a foreigner." And he left me for dead.
Now Tom Dewey has said some rather magnificent things
about the position of Australia. I hope they were taken down;
I think I might use them about the end of next year, when, in
the inscrutible wisdom of Providence there will be another
election. But they were very complimentary words. I think that
in substance, leaving out the bits about myself, they were quite
true. I don't know that there has been a decade in the
history of my own country that has seen such astonishing development.
But development, of course, particularly in a young
country, a country with a small population, a country which in
order to build up its population must not only provide firstclass
living conditions for its own people, but must have a
large movement of migration. One of the great problems when you
have that is that you get the pressure on your resources, an
over-demand on capital, a tremendous pressure of demand for all
sorts of social facilities which gives rise almost chronically
to inflationary conditions. Now that has been one of the great
problems in Australia4 how to maintain the rate of development,
how to give expression to this enormous desire to unlock the
resources of the country and at the same time preserve a degree
of stability in the currency which will produce confidence in
the minds of investors, both at home and abroad, and do justice
to those many, many people who live on fixed incomes.
And this has been, economically, one of the very
greatest tasks that a government could confront, and we have
encountered it we have sometimes encountered it successfully,
sometimes we haven't had all the success we might have liked.
Sometimes there have been circumstances outside Australia altogether,
which have given rise to the most enormous pressures,
like those which followed on the outbreak of the Korean War, for
example. But by and large, I do look back with great pride on
the measure of stability that has been achieved. I thought you
might be interested to know of our last experience in this field,
because about a year ago we began to see strong symptoms of
inflation, a cost inflation bearing very heavily on our export
industries in particular, wages high and rising, a degree of
employment which might be called almost over-full employment,
with all that that involved in the turnover of labor, inability
to maintain the ordinary disciplines of employment. Therefore
we decided that we ought to take some steps about it.
We have the great benefit in Australia of compulsory
arbitration. You go in for a different way of settling your
matters. I don't know whether it is any less expensive than
ours, but at any rate ours comes high. And in the course of
the calendar year 195' 9, the Commonwealth Arbitration tribunal had
added to the wages bill, first of all by an increase in what we
call the basic wage, and then by an increase in marginal rates of
pay. It added in one period a total of about œ CA165,0070OO
œ_ A170, OOO, OOO to the annual wages and salaries bill.
Now in a country of 10,000,000 people that11 was a very
very considerable injection of inflationary pressure. And so
this year we decided we would have to do one or two things that
were different. For the first time the Government, which has
always stood neutral in these wages dispute, intervened before
the Commonwealth tribunal and put up a powerful case for making
no further change in the basic wage. In other words we said the
whole economy of the country needs a period of time of a year to
absorb what has already been done, and in the long run you won't
be helping anybody if you add to the inflationary pressure and
see the price level rising and the value of wages being eroded
in consequence. And although this intervention of ours, I can
assure you, wasn't the most popular action of our lives, it
proved to be uncommonly successful, and the Commonwealth tribunal
acted upon it and said " No change". Now that in itself is quite
an historic event in Australia and I think must have a steadying
effect on the economy generally.
3.
At the same time we have found that for various reasons
it had been necessary in some earlier years to budget for a
deficit in order to prevent certain signs at various periods of
some minor recession from developing, and we had budgeted for a
deficit. This time we said, and I hope we will be able to perform
it popularly, that we would not budget for a deficit in 16o.
-61. That has been loudly applauded by hundreds of thousands of
peoplo who will loudly object to it when the time comes, But
we have nailed our colors to that mast.
And in the third place, as you know, we have had for
years now a pretty severe system of import liceonsing in order
to protect our overseas balance, Import licensing the sole
international justification for which is to protec our balance,
not to be used for some tariff purpose, that is an entirely
different matter. Tariff ought to look after that. But import
licensing, to restrain the overall volume of imports so that we
wouldn't see our overseas balances running down. And the
measures taken in the past have been so successful that this
yecr we have been able to announce the virtual termination of
import licensing. That, of course, not only means that there
will be a considerably greater inward flow of goods, plant, all
of w,. hich will tend to have a counter-inflationary effect, but it
also means that our trading relations with other countries in
the world become wider, more flexible and morc satisfactory all
round; because import licensing was very, very unpopular with
some people and its abolition has proved even more unpopular
with others. But by and large, through these various means, we have
been able, not without difficulty, not without constant scrutiny,
to preserve a degree of stability, which I am happy to say has
proved very effective outside Australia,
J,, e do, in fact, generate a great deal of our own
capital, out of our own earnings and resources, far more than
people sometimes think. There must be very few countries in the
world with a higher savings rate per cent of overall income than
we have in Australia. I know we are regarded as light-Ihearted
gambling sort of community, who think that tomorrow is another
day. That is not quite true. There has been an enormous satisfaction
of demand for capital out of the current earnings of
industry inside Australia. But over and above that, over these
last eight or nine years, the inflow of capital into Australia
has been quite phenomenal. I don't necessarily mean, or merely
mean monc : y borrowed by goverment on government account, from
say the World Bank, or drafts from the International Monetary
Fund, or whatever it may be. Putting those things on one side,
and looking solely at private investment from outside Australia,
in inlustry inside Australia, it has avoiag-d out, over the last
eight or nine years, pretty near to œ_ Alc'Om. a year, Now of
course, when I talk about a hundred million to you gentlemen,
you just regard that as small change. I know that, because as
I stood at the door side by side with this taciturn fellow,
Floyd Blair, I shook hands very warmly with about eight or nine
hundred million dollars. It was a wonderful sensation I kept
looking at my hand and wondering whether any of the dollars had
come off in the process. But to us an inflow of LZAlO~ m. a year
is an enormous accretion to our resources, and but for that I
venture to say we might have had some trouble in maintaining our
immigration programme and we certainly might have had to slow um..
to a certain extent, the industrial development particularly,
that is going on in Australia.
I know there are other parts of the British Commonwealth
that don't share this view, but in the result I am dolighted
to say we have had great sums of money invested in
Australia by American concerns, great industries have been
established, the whole motor car industry in Australia which
was regarded as a pipe dream 20 years ago is deeply associated
with enterprise from this cohtinent. And when you consider how
much that involves in employment in forward-looking employment,
in a sonse of social security, in the development of ancillary
industries, you will understand how pleased people like myself
are to find that just as we have striven for the right conditions
inside our own country, so people outside, not given to sentimental
judgments only on these matters, have found this a good
environment in which to invest their own skill and their own
capital. Therefore it is a . Zood picture, a good story.
But of course it is not the only problem we have in
the world, because Australia is not only Australia: it is part
of the free world. Its itinerant Prime Ministers fetch up in
London and attend Prime Ministers' Conferences and discuss
matters with great vigour. They turn up in Washington, and
discuss the problems of South-east Asia. We are not unconcerned
with what goes on in the world of course. And therofore I just
want to make one broad observa~ ion to you about the state of
the world: Hundreds of millions of people, let's put it quite
modestly, had high hopes of the Summit, exaggerated hopes if you
like, but even the most hard-headed of us would have expected
that out of a Summit meeting there might come a little crack of
daylight. Not a broad settlement, because at the moment we
discuss symptoms far more than we discuss causes, discuss results
far more than we discuss causes also, but most people, I think,
hoped that som~ ething might come out, some direction about, for
example, nuclear tests, where the East and the West had got
already measurably close to one another, and where one would
have expected that a good draft of commonsense night have overcome
the outstanding difficulties so that some headway might be
made. I-t~ ink that many people hoped that out of a Summit
conference there might come at any rate, some moratorium in
relation to the Berlin question, with all its stickiness and
apparent insolubility. And therefore when the Summit failed
before it be-an I venture to say that all around the world were
hundreds of mcillions of people whose first instinct was of bitter
disappointment, and whose second instinct was one of profound
resentment. Now of course the Soviet Union, the master of propaganda,
insofar as Khrushchev is still the master, which I am
inclined to doubt, but the masters of propaganda will have the
world believe that the Summit failed because the United States of
America had flown an aircraft over Russia and had been investigating
what when on. Now I remember being told m-. any years ago,
when I first went to the Bar, by a very experienced judge,
something like this: " I see you are getting a good deal of work."
I said: " Yes sir, I am, fortunately for me at any rate." And he
said: " Well, I just give you one piece of advice, I'm not pointing
the bone at you because I haven't had the opportunity of
hearing you, but Igive you one piece of advice: It is always
permissible to think that your opponent is a crook. B~ ut it is a
cardinal blunder to think that he is a fool." And t'lat is worth
remiembering. It is worth remembering in this connection because
to tell anybody in the world that the Summit failed because of
this aircraft is to assume that that somebody is a fool, because
no intelligent person would believe it. I don't suppose the
Russians have ever gone in for anything like that them-iselves. Do
they seriously expect anybody to believe them? Of course they
don't. I have a certain crude theory about this matter. It
falls into two parts: In the first place I think that the
measure of unity that has been established between the President
of the United States and the President of France a-nd the Prime
Minister of Great Britain has made a tremendous impanct on the
Soviet mind. It began to be clear to Khrushchev that perhaps he
wasn't comaing out of the Summit meoting with profit and therefore
it might be desirable not to attend it at all. I'll eerme back
to that question of unity because I just want to say a word
about it. But in the second place, on his own showing, this
celebrated plare came down. Of course if wasn't shot down either
Providence doesn't work that way. You know the pilot comes
down quite safely and all the bits and pieces come down in a neat
package in the one place. VTell it is a little hard to take. But
anyhow, it came down 900 miles inside the frontiers of the
Soviet Union. Now just think of it as an isolated event, if we
must be completely academic. Nine hundred miles is a long way;
nine hundred miles of undetected flight meant that the power of
the deterrent in the hands of the free world was immeasurably
greater than Khrushchev had ever admitted to his own people.
Because if one . could do it, a hundred could do it. If that sort
of distance was feasible, then without international ballistic
missiles, or whatever these new horrors may be, there was a
country completely vulnerable to counter-attack. And I'll be
very surprised if thaat melancholy reflection hasn't had a pretty
big effect on the mind of Khrushchev or even on the mind of that
gentle, soft, rather refined and angelic person Malenovsky.
And so I said I would just come back for one minute to
the question of unity. This is the American-Australian association,
this is the United States, the greatest power in the world,
Australia, one of the smallest powers in the world, Great Britain
France unity is so tremendously important that we ought never
to allow a day to go by without praying for it and working for
it. It is so easy to differ, so easy to disagree. It is in our
nature to disagree. do sometimes overlook the fact that under
our system of government we insist upon disagreeing. It's the
business of politics to have disagreements in your own country
It is the business of Congress or of Parliam.' ent to have every
possible point of view, every possible point of disagreeme-int
ventilated, thrashed out, and we take all this for granted. We
don't think that because we have a government and an opposition
in fierce debates that we are a divided country, because we know
that when it comes to the great things in the world we will be
together to the last drop. Vie know that. But we are accustomed
to our own forms of government. We want to be very careful I
think, not to allow the virtue of our system of self-government
to become a vice in the international field. To allow internal
disagreements to spill over into external disputes, because
these people, fabulously united, with all the instruments of
propaganda at their disposal, able to change their tactics every
day if they want to, still have a sort of monolithic quality
about then.. which enables them to take advantage of all the
differences that exist on the other side while never displaying
any of their own. They will do this; they will fish in troubled
waters; they will take advantage of every possible dispute.
It is a matter of very great urgency for the countries
which are outside the Communist orbit to settle their differences
among themselves, to settle thema with the greatest possible
speed. We were discussing only the other day cases in Southeast
Asia, where there are unresolved arguments between neighbouring
countries, each of whom has the m-, ost vital interest in
not being absorbed by Cormmunist China. And yet you have outstanding
differences, sometimes very griat, sometimes quite
tiddly-winky, but so long as they exist then the whole machinery
of the Soviet Union or of Communist China will be available to
inflame then, to build them up, and thereby hope to bring aboutnot
for the first time in history differences which are almost
crippling if they manifest themselves in the presence of the
same cormmon foe.
And so I say to you gentlemen,, I think we must all do
in our own way and in our o in place everything that we can to
preserve the highest measure of unity on the great mattexs. And
it ought not to be difficult, because we have all the great m~ atters
in common. Ie have in common our trusteeship for individual
freedom, and the great conflict in the world is between an a~ gros
; so fom 5ol slvr indi idual eo nta
we ognae re0 CVweeq naifo ddto an e~ prc ~ ooo