SPEECH BY THE PRIME MINISTER, THE RT. HON. R. G.
INZIES. TO THE GrATR I OT. O GONG CHAMBR OF
COMMERCE AND INDUSTRY
12TH JULY. 12
Sir, Mr. Mayor and Gentlemen
It's not my fault that I am standing up here in
the pulpit. ( Laughter) I was told that this was the drill.
" Timotheus placed on high, amid the tuneful auire, with flying
fingers touched the lyre." ( Laughter) I think that for e
man who lives a dull, uninteresting life as I do, ( Laughter)
to come here and be confronted by I don't know how many hund:' eds
of Wollongong businessmen, is a great ordeal; because, looking
around you, and I can only see the ones who are nearest me, I
would think that if I took a Galli'p Poll among you, I would not do
all that well. ( Laughter) ( Applause) And as I'have unter my benign
exterior, a certain combative streak, that's what I like.
I can remember once going to the Annual Dinner
of the Chamber of Manufactures in a city that shall be nameless
and being received with frosty silence that would have established
air-conditioning in any house in the tropics, ( Laughter) But,
in the long run, I warmed them up a bit. In fact, I did
frightfully well that night; I got 30% of their votes at the
next election, ( Laughter)
But I like coming to Wollongong, You might think
that that is not true because it is some years since I was here,
but as I said to you, Mr. Mayor, this afternoon in that Reception
that you were so pleased as -o give me, so kind, I have a soft
spot for Wollongong, because I remember so well coming down hero
you don't mind me repeating this when there was a little
" trouble"; ( Laughter) and largely as a result of innate stupidity,
I have always believed that you ought to go to where the trouble
iSo ( Laughter) Now I came down here, and I drove down the
main street; there were placards out; they reflected on my
ancestry. ( Laughter) They invited me to go home, and there was
a certain amount of fun and games and, in the upshot, it is to
Wollongong and Port Kembla that I owe the one title of honour
that I possess. ( Laughter) ( Applause)
( Voice in background) " Name it"
" Pig-iron Bob" ( Laughter)
You know it is very amusing, really, If you
get a title like that, a tag put on to you, you can do one of
two things. You can become very angry about it, and I have
known people silly enough to become angry about such things.
Or you can wear it like a ribbon in your coat, and I must say
I went on wearing it like a ribbon in my coat, until today if
somebody is sufficiently out-of-date or sufficiently inebriated
at the back of a political meeting to say " Pig-iron", everybody
roars with laughter, and I take a bow. ( Laughter)
Now, of course Gentlemen, I road the newspapers,
or some of them ( Laughtor) and I occasionally look at the
Gallup Poll or some of it ( Laughter) and when I do, I remind
myself of a famous occasion when I was Leader of the Opposition,
Some of you are so young, so boyish, you don't remember me as
the Leader of the Oppcsition. ( Laughter) ( Applause) But at that
time, among the Members of tho Opposition we used to have a Party
meeting, it was a courteous thing to do; we had 17 seats in a
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House of 71+. You've forgotten this. ( Laughter) But we had
a Party meeting from time to time and, one day, Billy Hughes,
who was a Member of that Opposition, was sitting there, wiring
himself up to whatever leads might come ( Laughter) from here
or there; my former colleague and great friend, Phil McBride,
was up making a speech. Well, everybody knew but nobody but
Billy was rude enough to mention the fact that at the previous
general election, Phil McBride had been defeated for the
Senate. but by the inexorable law of the Constitution, he was
still a Member of the Senate until June the 30th and tnerefore,
there he was, in the Opposition Party meeting, and he offered
some very sensible views. Little Billy listened to it and
nodded his head. He always nodded his head when he disagreed.
( Laughter) And the moment Phil McBride finished, Billy got
un and said, " Oh, well, you know, my friend McBride; he speaks
with a falling inflection." ( Laughter) Now. Sir, why, having
read the last Gallup Poll, did I remind myself of that story?
( Laughter) Well, I leave it to you,
But, anyhow, before I disappear into the abyss, if
that's the drill, I would like to say that no Prime Minister
of Australia with my experience in that office and with my
knowledge which I ought to possess of our problems around the
world, could fail to be interested in coming here and in talking
to you, because you represent, in this area, a microcosm of the
whole Australian economy and development; the great industry
of iron and steel with all its ramifications, the great primary
industries down on this coast all of these things, coal, coal
exports one could talk about themn for a long time. But you
are very fortunate in being here in an area not unlimited in
point of size, but an area in which primary industry, secondary
industry, tertiary industry, local industry, export industry,
are all to be found. And if this great area continues to
develop as it has so splendidly, then it is reasonable to say
that Australia will develop splendidly in the future, ( Hear,
hear) We can be on the home ground here, We can discuss any
aspect of politics in this city and feel that we are at home
with some aspect of whatever problem it may be. And that is,
I think, tremendously important,
And it i. s tremendously important, in particular I
think, for two reasons there may be four or five or six
but within the limits of time, I would like to talk about a
couple of them.
And the first reason is this: it is much easier to
be on the outside of Government, looking in, than it is to be
on the inside of Government looking out, I hope you will agree
with that, A Government at Canberra with acutely limited powers
must do its best to direct, not to control., the economic development
of the nation, And this is a tremendous problem,
There are somei things that are not within our control,
* o have nothing to do and nothing to say about many of the
aspects of the economy that the outsider would look at, But
we do have a groat responsibility for the Budget, for monetary
control, for the determination as to whether credit is to be
easy or credit is to be tight. I know all this. These things
are very true, And we found ourselves, not all that long time
ago, looking at a state of affairs in which there was a great
inflationary boom going on in Australia, I don't think anybody,
sensibly, denies it, Our overseas balances were running down
fast Now, of course, I am able to tolk to you because you
are businessmen and you understand thcse things, but there are
so many people who do not b,-gin to understand why you should
worry about the overseas balances of a country, failing to
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realise that the first thing that I heard about iri -uaela when I
was; there the other day was their balarce of trade and payments;
a balance problem which is beginning to worry them. And what's
happening in Great Britain? The problem of the balance of
payments, the problem of keeping the export market up, of
keeping the importation of material within reasonable limits.
This is a universal problem, not peculiar to us, not peculiar
to the Menzies Government, not created by some arrant folly
on our part. This is a problem which bemuses the whole of the
Western world,. I mentioned America. You know, it is only a few
years ago isn't it, that dollars for us wore as scarce as hen's
tooth, ' No, you can't have them", " There are great restrictions
on access to dollars" And that was because at that time the
dollar was the commanding currency of the free world. But
if you went into VWashington today, and talked with Finance
Ministers or bankers or high people in the Administration, the
first thing they would want to talk to you about would be their
balance of payments problems, How long can they continue to
find a billion dollars or two billion dollars in their language,
or foreign aid for helping weaker nations in the world, Lecause,
the fact is that in the last twelve months, gold has been running
out from Fort Knox and gold has been running out from Canada
whose gold reserves are singularly depleted of late. We are
not the only people to have these problems.
But we, in Australia, decided that we were not going
to allow this problem to become acute, We were going to try
to deal with it. And you can't deal with any problem of an
economic kind in our country without irritating and infuriating
a lot of people, We just have to put up with that, The fact
is that Australia, for the last eighteen months, has had a
balance of payments position, a state of reserves overseas which
is, on the wholo, the envy of those other countries that I have
been referring to, ( Hear, hear) ( Applause) This is not
unimportant, It is not unimportant to know that you have under
your control overseas a volume of overseas reserves which could
sustain a blast of imports or some fluctuations in export income
for quite a long time. This is tremendously important. And as
I have lived long enough and been a Prime Minister long enough
not to care unduly whether I am tossed out, I propose to continue
to do what I think is good for this country. ( Hear, hear)
( Applause) This is oL, of the great things that has happened.
Now, we also set out to restrain inflation in Australia,
Now again, gentlemen, don't let me pretend about this matter.
There may be many of you here tonight as there are many people
engaged in enterprises in Australia who have no objection to a
spot of inflation ' What's wrong with a little inflation?"
" All this boosts up the equities, it develops a state of
affairs in which the population rises and we are all optimists."
I understand all that. But inflation is the most unjust tax
in the world, and it is one of those unjust taxes which fails
most heavily upon the people who cannot afford it. And therefore
we set out to say, '" oll, wo must restrain inflation,"
I have never understood the principle on which
headlines arc allotted, ( Laughter) I always appear to get into
them at the w rong tim, ( Laughter) But I do want to remind you
that for the last eighteen months, that's a long time, the
consumer price index in Australia has been stable. In other
words, for the last eightecn cnrcnts, wo have -ad no inflationary
pressure rcflecting itolf in the price levels. I wondcr if
there is any other country in the w orld on our side of the
Curtain that could say tht. I doubt it, I know we've had our
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great periods of inflation caused by causes which you are all
familiar with but in these eighteen months of unpopularity
( Laughter) it is still true that we have had stability in the
consumer price index, Aren't these important matters?
Now somebody and this is the first point I wanted
to make to you somebody will be heard to say, Oh, yes, but
this Government is unduly concerned with stability." I've
heard this. You must not suppose, gentlemen, that because one
lives some of the time-not much-in Canberra that one lives in
what they describe es an ivory tower and is unaware of what
people say. If anybody around Australia says something in my
favour, I never hear it? but if somebody says something against
me, I hear it next morning. You needn't worry about this.
( Laughter) This is all quite simple and quite clear, and I
know that a lot of people, some of you perhaps, have been saying,
" Oh, yes, Stability. That's very good, but what matters in
Australia is growtho And these boys who are interested in
stability are not interested in growth," Now would you allow
me to say ho. silly that is.
Why do you want stability in Australia? Why do you
want the value of money in our own country to maintain itself?
Because you want to be able to invest money in Australia with
some belief in the soundness of the currency. Because if you
are like all of us you want to see your country grow, you want
to see investment in it increase, and as 10-million people
can't find all the money for capital investment that is needed
for a continzat, you want to feel that investors from other
parts of the world will be prepared to put their money into
this country, put it at risk, in order to develop some industry
in this country. This is, I think, elementary.
You can't have growth on an unstable foundation. I'd
like everybody to think about that because there are quite a few
people who believe that the very definition of " growth" is to
have an unstable foundation, to have the value of your money
rocketing up and down. I don't believe it for a moment, and if
there is one reason more than another why, in this period of
stability brought about by painful means, we have continued to
attract to Australia capital investment on the private field
more than perhaps any other country in the world, it is because
we have offered them a firm foundation,
Now, I wonder Sir, if I might illustrate that just a
little. I don't want to be too political about this matter, but
these are great national problems. For the last eighteen
months, we have had this hard-won stability in the currency, this
hard-won stability in the price level, this remarkable achievement
in the overseas balances. Has this meant stagnation in Australia?
Because, you know, thero are a lot of people in the world who are
bemused by words. If you say " stability", they say, " Ah, that
means stagnation." Very simple, dogmatic statemont. Has all
this meant stagnation? Well, really, Sir, I applied myself,
with the aid of my staff, to the problem of Greater Wollongong.
I don't need to talk to you about the development of your great
city. but I was interested to note this: that in the two years
of alleged stagnation, what has happened here has been that the
vessels entering the port have increased from 1,025 to 1,091.
That is, perhaps, no great matter. The coal exports from here
have risen from 628,000 tons to 805,000 and the iron and steel
exports from 149,000 to 454,000. Now I invite you Sir, to be
proud of this place, I invite you to Lake the lessons that you
have learned here in your own place and apply them to our great
country. In this period, when people have been talking professionally
about stagnation what has hapccned here has been the
0
greatst-s proof of dynamism in the Australian economy that I
could possibly imagine.
As I said this afternoon when the Mayor was kind
enough to give me a civic reception, my memory of the coal
industry goes back a long way. In my earlier and more
respectable days at the Bar, ( Laughter) I appeared for the
coalminers and for the coalovmers and conceived modified
rapture about both of them ( Laughter) and when, in the
inscrutable wisdom of the electorate, at the end of 19+ 9,
I was plucked out of being Leader of the Opposition and
became your Prime Minister, we were importing coal, the coal
industry was in the doldrums South African coal, Indian
coal and some of you may recall on the charter-parties, a
heavy seller's market. There we were, trying to boast that
another half million tons of coal had been secured from some
other country to this wonderful coal-producing country, and
today, the expore of coal has become a substantial industry
and when these coal-ports are completed, like the groat one
going on now here, the export of coal from Australia will
become a very heavy export earner for Australia, And I would
like every manufacturer to reflect that the more we export,
the greater our export income, the more we can afford to pay
for our imports, over 70o of which come directly in aid of
manufactures in Australia.
And, therefore Sir, I find myself in a community
which ought to be, and I am sure is tremendously optimistic,
* ihich sees in all these things the graphic evidence of the
fact that stability is not stagnation, that you can have
stability and have expansion and growth at the same time
because one comes in aid of the other. Now, Sir, that is
really the first point that I wanted to make to you,
The second thing I would like to say something to
you about is that by common consent I get it from everywhere
and I know it in my own bones, there is a certain uncertainty
in the market, a certain hesitation, a certain lack of complete
confidence because of the Common Market discussions. You
know, we are a little bit inclined, Sir, in Australia to think
that the things that happen to us have never happened to
anybody else, a little bit disposed that way.
All I can tell you is, that in London I would
encounter people who would say, " Well, you know old man, there's
a certain amount of uncertainty because we don't know about
the Common Market," And in the United States of America, one
of the factors in their recent recession which would be put to
you would be, " Well, you know, there's a feeling of uncertainty
about the Common Market." And, of course, it is true here,
although the first thing I want you to remember is that it is
true everywhere; because-rhese Common Market negotiations, the
great problem as to whether Groat Britain goes into Europe or
not is one of the great revolutionary decisions in modern
history. Don't let us underestimate it.
People are now all, of course, becoming increasingly
scientific and therefore I regret to say they don't read
history any longer, but anybody who has read any history will
tell you that since at least the middle of the eighteenth
century, classical British policy, foreign policy, has been
to remain out of Europe but to exercise the balance of power,
If the Prussians got too strong, put a hand on the scale; if
the French got too strong, put a h-: ndl on the scale, but stay
outside of Europe and influence the balance of Europe, And
some of the great leaders in Great Britain have decided, I
/ 6
think, thait; this has gone far enough. They say " Well, twice
in this century we, the British, and we, the Australians, have
been involved in wars which began in Europe. It is high time
we, Great Britain, went into Europe and exercised our. influence
from within." Now, all this is very intelligible, Nobody
need scoff at it. It is a great historic conception. The
only point I want to make to you is that it involves a radical
departure in British foreign policy, No longer the balance of
power from without but the influence from within, And this
is not to be underestimated.
The historians in a hundred years' time will write
about this as ore of the great climactic periods in British
history. And it is because I know that, because I believe it,
that I am not at all disposed to be dogmatic on these things.
But what I do know is that if Great Britain is to go into ttle
European Community, if Great Britain is to accede to the
Treaty of Rome, then the terms and conditions now being hammered
out with the six European members of the Community are of
tremendous importance for us because we, practically all of
us in this room, in our adult years at least, have grown up
to take for granted a pattern of external trade which has
been primarily the Commonwealth pattern of trade advantages
on dairy products, advantages by the sugar agreements, advantages
in relation to dried fruits and canned fruits, advantages in
relation to wheat, advantages in relation to meat.
All these things have become part of the stuff of
our living in Australia and now they are exposed to challenge
because there are countries in Europe who, quite intelligibly,
would say, " WJell yes, you had it, It was very good while it
lasted, but if you want to come into our Common Market, our
customs union with internal free trade and a common external
tariff, then you must play the game according to the rules."
And so Australian dairy products or Australian canned fruits
or dried fruits must pass over the common external tariff
barrier and, quite frankly, that's not much good to us, because
we have disadvantages by distance and otherwise, and by the
very standard of our living, which are not to be ignored;
and, consequently, wo, Australia, have from the very beginning
I want you to understand this quite plainly adopted a completely
active and constructive attitude on those matters.
For the last year or more, Australian officials have
been sitting down with British officials with European officials
hammering out, commodity by commodity, what should be obtained
in order to preserve, if not in its pure form, at any rate in
substance the pattern of Commonwealth trade. This, after
all., was the great reason why I w*' nt abroad in June, because
I thought that by September when the Prime Ministers meet, it
might be too late, I don't think so now, but I thought that
at that time. It might have been too late; perhaps attitudes
might have been crystallised by that time and, therefore, the
right thing to do was to go there while things were still in a
state of flux and, similarly, to America while things were in
a state offlux. I am not at all disappointed with the results
of these errands. Not at all, I don't know what the result
will be but I have no doubt whatever that both in London and in
Washington our position is at any rate clearly understood.
( Hear, hear) ( Applause)
. e are not sitting in judgment, nor should wo, on
the political question, as to whether Groat Britain should go
in to Europe, We may h-. e our own privaet views on those
matters, but in the long run, this greatc, historic decision
must be made by her. Thi: t does not m on to say that we are
not interested. We are, but in the long run, she will make that
decision and on that decision there is an immense complex of
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divided, opinion at this very moment in Great Britain itself.
But when it comes to how far our pattern of Commonwealth
trade a pattern which has determined so much local development
in Australia, not something that can be cancelled overnight,
so much development, so much settlement, so much direction of
activity on that matter, we say, must be consulted, our
view must be listened to with respect," and both of those are
completely accepted and, in the long run, we must be quite free
to say whether we approve or disapprove of the results that are
achieved. Now that's fair enough,
The one thing that troubles me about all this is that
I think that there may be exaggerated views, as if we wore now
facing some disaster. Now, I beg of you, don't got into that
frame of mind. I don't beliove, myself, for one moment, that
any British Parliament would allow any British Government to
go into the Common Market on terms which would eliminate all
Commonwealth preferences by 1970. I don't believe it for a
moment. I may be right or wrong on that. I'm pretty sure
I'm right. And that means that there will be negotiated
arrangements on a great variety of matters.
Now, we are not to fall into a panic about this,
What we have to do is to realise perhaps that the old and
simple days may be coming to an end, I don't mean by that
that all preferences are coming to an end. The old, simple
outline of it may have to be modified in future. And it may
very well be, and I am sure it is, that Australia will be
increasingly looking for now markets in the world, and not
only for existing commodities, but for new commodities And
this is the one point, really, that I wanted to make to you.
Here you have in this versatile community, here, with
its immense variety of production and of interest, a great
opportunity for looking at the world and saying, " Well. if
there is to be some modification of our entrance into our
traditional market in Great Britain, if this is to be modified
in some way, then at any rate, we have the world open to us
and we must increasingly find to what countries we can sell
what goods, And the thing I want to say to you about that, and
I believe it is very important, is that we tend, and you the
business community tend, to be a little conservative in our
thinking. W hen we talk about new export markets to the great
countries of South-. East Asia, what do we do instinctively?
We think in terms of butter or meat or wheat or something that
we have boeen in the habit of exporting. It is quite clear
that, increasingly, and I know that the best minds are directing
themselves to this, we must increasingly seek to vary our
exports in ordor to discover into which of these countries we
may sell things that we have never thought of selling before,
There is very active work being done on this on the dairy side
by examinations of the possibility of selling milk in other
forms in South-East Asia, as you know. This is admirable,
It may be that there are things that we can produce in Australia
which we have not so far produced, which are not orthodox for
which a market can be found in a variety of these countries.
Don't underestimate the incredible scientific ability
of the Australians. The C. S. 3I. the people who are engaged
in research, these are remarkable people ard, constantly, they
are discovering now things, now ideas, new processes, but so
far, we have not hnd quite the pier. fct liaison between thor / 8
and the manufacturing -,; o-rld or producing world, because
somebodyr perhaps snys, ' 1Ob. 1 well, that's someting ne-u,
1Te ' re doing very nicely, than you, cun2itg S14h 1. ine_, 1
ar ging to be fa ce d2 i rat BiAtai roes -into
tUhe Coieimon Market on any terms tha-t are noai ceinprohens'bl a
by m'e, we are going to be., faced, not withi disaster, de'. r-me,
no. but withi a challengre to g: et cracking, to di scover new
in wiaici we can build up our income . broad. and thel'efore)
ncO'. r ways in / ich we can increase our eve-lopment alut-; ome.
I' 1knou more about this after the 2e'atombe-r conference and
whon i come backx from T w! ill take an early oppor'; Lunity
in he Parliament of telling thie Parliament and the pcoepL
thie nature of tiie chiallengo lUhat I t,, ii'nk. is pre3sented to us
and 1 will, end u~ p by saying7, or if I don't say JLI, I imay noG
rcmemnber t, but by tMhikcing thiat once a criallongre is presovlted
to my own people, in mry own ceunt: y, thoy hnava never yet failed
to meet it . c-1