TRANSCRIPT OF SPEECH TO INTERNATIONAL IRON AND STEEL
ANNUAL CONFERENCE DINNER, REGENT HOTEL, SYDNEY
9 OCTOBER 19190
E OE PRCOOF ONLY
PM: Sir Robert and Brian Loton. Brian, thank you very
much for that introduction. May I at the outset thank
the conference for the invitation that they have extended
to me. And secondly, most importantly, ladies and
gentlemen, on behalf of the Government and the people of
Australia, J: extend to you the most hearty welcome to our
country. We thank you for the honour that you've done us by
assembling and meeting here and having your important
deliberations in our country. I wish you well for those
deliberations and upon your return to your respective
countries. I have, ladies and gentlemen, discarded my prepared
speech. I think to some extent my friend and colleague
Paul Keating; covered some of the ground that I had
thought I would cover in talking about the economic
development in this country.
Rather I thought you might find it more helpful and I
think in a -sense I would find it more interesting if I
were really to share some thoughts with you on issues
which in a sense are common to you in business and to we
in Government.
Because I believe that in a very real sense the
challenges confronting business and Government are
essentially the same. But when you strip it down the
challenges that confront you in business and confronts us
in Government is to try and read the environment in which
we'fre operating. I don't use the environment in the more
technical sense that it's talked about now but in the
broader sense of the word. To read the environment in
which we're operating and in a sense to try and shape
that environment. That's the challenge that confronts
you as businessmen. And it's certainly the challenge
that confronts an intelligent Government.
So, what I thought may be useful, is if I was to share
some thoughts with you from a prospective of now having
been Prime Minister of this country for over seven and a
half years, about how I've seen that in terms of
Australia, how I've seen it in terms of the region and
how I've seen it in terms of the world.
May I talk about Australia first. This is indeed a
remarkable country by any sort of standards that you
would wish to apply. You would know that there has been
applied to us the term, the lucky country. And in a
very real sense that was an intelligent phrase to apply
to Australia.
I don't want to go right back into history but let me
briefly talk in terms of the post-war period. The war
for Australia was a dramatic, but compared with others,
not a traumatic experience. True it is that Australia
lost thousands of men, some women, in the war, and tens
of thousands of Australian families were touched by the
tragedy of war. But compared with the experience of
others, Australia was not only not badly damaged but in a
sense it was a growing up period for Australia.
We had to learn to do things that we hadn't done before.
Then, importantly, during the darkest period of the war,
we had a Government, and I take pride in saying it was a
Labor Government, which while accepting the challenge of
defending this country in war, also had a view that in
the post-war period we must try and shape a better
Australia than the one within which we went into the war.
And part of that thinking involved one of the most
imaginative decisions that any country has ever
undertaken, and that is the vast migration program that
characterised the early post-war years in this country.
At the end of the Second World War we were a country of
seven million people. But with this vast migration
program we expanded our population: we're now 17 million
people. It was one of the great migration programs in
the whole of recorded history.
It posed the challenges for us as a society. And I can
recall as a young man in my first year at university
after the war in 1947. My first year as a law student
seems like a thousand years ago. It's not; it's only
some 43. And I can remember being touched and worried by
the way in which my country was responding to some of
these challenges of change at that time.
We were not generous in our initial attitudes to those
who had chosen to come from other countries and make
Australia their home. In those days the target of shortsighted
Australians was the Italians and the Greeks who
were the major non-British groups who were making up the
new wave of immigrants to our country. There were some
unpleasant experiences for those people at that time.
Of course we went through the period up until the 1960s
where our immigration policy was characterised by racism.
We had the White Australia Policy which was morally
shameful, anti as I've said, also economically insane.
But to the gr7eat credit of both political parties in this
country in the 1960s, we changed and have adopted a nondiscriminatory
policy.
In economic t: erms we were lucky in that period because a
war-devastated world cried out for what we could produce
in our great rural industries.
The world pai~ d enormous prices for our wheat and our wool
and our meat. We were exceedingly prosperous. We
pursued a short-sighted policy industrially by erecting
very considerable tariff barriers behind which we
employed so many of these hundreds of thousands of people
who came to make Australia their home.
We were indeed the lucky country because we were paid so
much for what we produced. And when the world started to
be able more easily to feed itself and the prices for our
agricultural commodities subsided, we went into our first
great mineral. s boom.
And so really in the whole of that period from the end of
the Second World War up until the 70s, Australia was the
lucky country. We were able to have considerably
expanding popu * lations, fairly steady economic growth,
fairly consistently full employment and rising standards
of living.
We were lucky, but in a paradoxical sense we were
unlucky. Because the bounty which we so easily received
tended to lead my fellow Australians into believing that
in a sense the world owed us a living. There wasn't very
much we really had to do to make our way in the world.
It wasn't until really the 70s that there started to
begin the dawn of understanding that the world wasn't
quite as easy, as all that.
But it hasn't been, I believe, until the 1980s and
Brian, you've! been very generous in your comments about
this I think it hasn't been until this last decade that
Australia has really started to understand the truth of
this tough, hard, competitive world in which we live.
My friend and. colleague Paul Keating would last night
have gone-through with you many of the economic
decisions, the policy concepts that we've applied, to try
and change Australia, as I have put it, in the last
election, to try and change Australia from being thinking
of itself as the lucky country into changing itself into
being the clever country.
I don't want to this evening, my friends, really go over
all those things that my friend Paul has spoken with you
about. But I did want to say something about, in a
sense, what has been foundational to the economic policy
changes that we've made and in which in a sense I think
are of significance for you as you think about this
country and as you think about your own and as you think
about the world.
Because I think much of what has happened in this country
in a way has been reflected in some of the vast changes
around the world and to which I want to refer in a
moment. I took the view when I became the Prime Minister of this
country in 1983 that we were indeed an extremely
fortunate country because there are very few countries in
the world which are blessed with the features that we
have.
What I simply, and without being exhaustive, they are
firstly a land of some 17 million people who
paradoxically are very heterogeneous in terms of their
countries of origin, but very homogeneous in the
commitment, the universal commitment in this country to
the processes of parliamentary democracy. The concepts
and practice of terrorism are alien to Australians.
So that is one great advantage that we have. The concept
of the institutions of parliamentary democracy are deeply
and unalterably entrenched in this country.
As you know, from your industry, this is also a country
of vast natural resources. Almost unmatched, in a sense,
in the range and the depth of those resources.
We are now strategically placed in the world, in a region
which is the most dynamically-growing region of the
world. So I thought it strange, as I assumed the
responsibilities of Prime Ministership in this country,
that we really hadn't done as well as I think we should
have. It was because in a sense we were remarkably stupid
amidst this luxury of benefits, if you like, and
endowments that we had.
It seemed to me that we were, as a society, an economy,
stupidly short-sighted in the way in which we pursued our
interests. As far as the trade union movement, the
organised labour movement was concerned, we perceived our
interests as just being involved in trying to get the
biggest wage increases that we could and the best
improvement in conditions on the assumption that there
was a limitless cornucopia there which would provide the
satisfaction for our desires.
So that short-sightedness greed, if you like was I
think at least equally matched on the side of business
who didn't really have a sense of identity of interest
with those whom they employed but sought to advance their
interests by simply thinking of a maximisation of their
own position. And it was inevitable, if you had two
sides of industry like that, and particularly if you had
a Government which at times tended to fuel that
atmosphere of confrontation, it was simply inevitable
that this country was not going to do its best.
And indeed, as Brian knows, as we've talked as recently
as tonight, the steel industry in this country was in
some sense a microcosm of the problems that we had. A
great company, BHP, a very significant company in the
history of this country and still a very significant part
of our diversified economy.
But within that industry, through a mixture of attitudes,
the part of management and also of the trade union
movement, the industry was running down and there was
even contemplation perhaps of whether it would continue.
But in a sense it was a microcosm of the problems of this
country. The view that I brought with my colleagues to the
Government was that we shouldn't be altruistic, in a
sense, in believing that some sense of morality and some
highly developed sense of the public good was going to
motivate people into sensible action.
It seemed to me that what may move people to more
sensible action was a developed understanding of their
own self-interest. Self-interest always is operative.
I wanted, with my colleagues, to explain to the Labor
movement and to explain to industry, that both their aims
were legitimate. It is legitimate for working men and
their organisations to want to improve their conditions,
their standards, their own personal standards, and to
improve their capacity to look after those who are
dependent upon them.
Those are legitimate, they are indeed worthy objectives.
And equally, it is a totally worthy objective of industry
that it should seek to grow, to prosper, to increase its
profitable capacity to invest further and to grow.
They are not, and should not, be seen to be contradictory
aims. What we tried to convey to the trade union
movement of this country, and to our friends in the
business community was that if indeed that they concede
their identity of interests, they were both more likely
to prosper, that you would create a greater security of
employment in this country, more jobs, and that you would
create the environment for a growing industry if in fact
there was more co-operation and consensus in approach
than confrontation.
So that was our philosophy, if you like, and it was
reflected in this country in the Accord between the
Government and the trade union movement and in which very
substantially the business community co-operated.
In the result we have had remarkable successes. I don't
know whether Paul went to all the statistics, but one
which is fundamentally important as far as we are
concerned has been the growth in employment.
We've had a rate of employment growth which has given us
1.6 million new jobs, with 90% of those new jobs in the
private sector. A rate of employment growth which is
twice as fast as the rest of the OECD.
Those things could not have happened if in fact the trade
union movement had not exercised, and as the business
community has acknowledged, the very considerable
restraint in the capacity they would have otherwise had
to go for higher increases in money wages.
We as a Government assume some of the responsibility of
the expense of labour by significantly increasing what
we're pleased to call the social wage. And in that way,
Labor in this country was prepared to substitute to some
extent increases in money wages for increases in the
social wage which were reflected in the area of health
care, education, child care and the like.
Now in that way my friends, we have in this country, I
think, attitudinally undergone a revolution. If there is
one plea that I would make in talking about my country
with so many representatives, distinguished
representatives and strategically important
representatives of industry from around the world, it is
this. That you should please understand that any
stereotype that you had in your mind about Australian
industrial relations of the past is not true of the
present. There has been more than almost a 60% reduction in
industrial disputes in this country; a 10% reduction in
non-farm real unit labour costs; a significant move from
wages to profits which has been associated with an
historically high level of investment. And those things
basically have come about not simply through changes in
economic policy of which you are aware, but all those
have been founded upon this philosophical, if you like,
attitude that this country which has been the lucky
country can only be a successful and competitive country
in this tough new world if it indeed was going to set
about the business of trying to work more sensibly
together. I do ask you to understand that you are looking at a
country now which is undergoing that transformation,
which is accepting the challenge that it can no longer be
seen as the lucky country, that we have to make our way
in the world, that we have to be competitive and in doing
that, let me say to you that we understand that we can't
do it by ourselves.
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We welcome investment from overseas in this country and
wherever it comes. We understand that we need the best
of new technology that is available from around the world
which harnessed with our resources and with a skilled
labour force is capable of developing this country in a
way which we cannot do by ourselves.
Now of course these changes that have been taking place
in this lucky country which is now becoming a more
sophisticated country have been occurring of course in a
world and a region which is changing almost beyond
measure. I would like to say just a few words about that
if I may.
We are of course, ladies and gentlemen, singularly
fortunate to be living at this point in history. There
has probably not been a more exciting time to be alive
than this present age. The world that we're living in
now is almost unrecognisably different from that world in
which we all grew up. Not merely in material and
technological terms, but now excitingly in political
terms. We have witnessed just in this last few years the most
dramatic transformation in international relationships in
the whole of recorded history. Until just two or three
years ago the two super powers were concentrating their
efforts on a seemingly endless accumulation of the means
of destruction which could destroy not only each other
but the world thousands of times over.
This was both frightening and it was economically insane.
The of the magic chemistry of circumstances can't
entirely wait and define but which, when history is
written will pay very great tribute to two men, Reagan
and Gorbachev. Due to a magic chemistry, but also due to
what I see as an understanding at the international level
of the truth of what we've seen in this country, that is
that the true protection and advancement of the interests
of the people of the Soviet Union and the people of the
United States was much more likely to be achieved by
consensus and co-operation than conflict and the absence
of consensus. That understanding dawned and we have seen
now those great powers seeking to work together to
advance the interests of their own people in that way
rather than by fighting one another.
Of course that has immeasurable implications for us all.
It is not the time or the occasion of course to attempt
to analyse all the implications of what's happening. But
I do say this, that it seems to me that it is profoundly
in the interests of us all to ensure that those great
changes that are taking place in Eastern Europe and the
Soviet Union are given the maximum chance of succeeding.
Because that will be good, not only for the people of
Eastern Europe and the Soviet Union, that they will come
to understand the immeasurable benefits of a free society
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both in political and economic terms but it will also be
of immeasurable benefit to the rest of the world in terms
of our security and in economic terms in the opening up
of greatly increased market opportunities and
possibilities for international trade and commerce
between us all.
But even so far as this region is concerned, I would like
to say just a few things here. Until we became the
Government in 1983, Australians, thinking Australians had
tended to express the view that Australia was part of the
Asian region. But it had been very largely lip service.
One of the commitments I made when I became Prime
Minister was that we would try and translate that lip
service into reality.
And so in the seven and a half years since we have been
in office, we have attempted in reality to move to enmesh
the Australian economy into the economy of the region.
That's been done essentially in these ways. Firstly by
strengthening the bilateral relations that we have with
the countries with the region. Very importantly, at the
beginning of the last year, I took the initiative in
Seoul to move to establish what has now become know as
APEC, the Asian Pacific Economic Co-operation Council.
We are proud here in Australia of the way in which the
countries of the region have responded to that call.
What we are seeking to do there is to give substance to
the truth, that the countries of this region are the more
likely to grow both in economic prosperity in terms of
political security if we take steps to try and enmesh our
economies together. And that movement now, I believe, is
irreversible and the next stages of that process are to
look to the enlargement of APEC by looking at the three
Chinas; mainland China, Taiwan, Hong Kong. And then I
believe later down the path we'll also be able to look
at, if the Soviet Union develops a marked economy and it
inevitably will, the possibility of the Soviet Union
joining as well.
As far as Australia is concerned my friends, we see our
future very much as being identified with the region.
May I say to my friends from Europe that it does not mean
in any sense that we see an end to our important
relationships with Europe. A country which has been
established in the way we have which owes its
institutions to the United Kingdom is not going to break
those relationships into the future. But it is the case
that if you look at it in economic terms our future is
very much in this region.
May I say particularly therefore to those representatives
from Japan and other countries in this region that we
want you to look at Australia no longer as some isolated
outpost of Europe. We are a country which is indebted to
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our origins for the institutions that have made us a
great parliamentary democracy.
But essentially our economic future is in this region and
we seek to enmesh ourselves with it and we are in the
position my friends where we have in a sense put our
decisions where our mouth is.
That leads me to the final thing that I want to say. It
is this, that it will indeed be one of the great
paradoxes of our time and one of the fatal paradoxes if
we are part of this great transition in international
political relationships which offer for the first time in
the nuclear age the possibility of security, if we, as
being part of that, make the fatal mistake of not showing
the same degree of intelligence in the way we organise
our international trading relationships.
To be specific, we are now as an international community
coming to a deadline in the Uruguay Round. It is
scheduled to finish at the end of this year. I tend to
think that because of the diversion of resources and
intelligence that have been associated with the Gulf
crisis that there may be some extension beyond the end of
this year to try and get an outcome.
But let me say this, that if we do not get a successful
outcome to the Uruguay Round in which, speaking from a
point of view of Australians there was appropriate
recognition of the need to get a freeing up of trade in
agricultural products, then it is very likely that the
Uruguay Round will end in failure.
If that were to happen, history certainly would teach us
this, that if you descend into economic autarky because
you cannot in fact have sensible international trading
relations, then you move very quickly towards a deeply
de-stabilised political situation. And that would indeed
be the fatal paradox a world which has shown its
capacity politically to come to mature decisions in terms
of its relations but then blew that up against the wall
by not being able to make sensible international trading
decisions. That's why my friends we in Australia have taken a lead
in the formation of the Cairns Group which has become now
an established entity in these negotiations between the
European. community and the United States of America. We
will continue to show leadership in that area. Not
simply in pursuit of our own interests, although they are
present, but in the basis of a very firm conviction that
our own interests and the interests of all other nations
are only going to be properly served if we do have a
fully freed-up international trading system. I believe
you in your important industry will and should share
those views.
So it means I hope that you will see in what I've been
trying to say to you that we in this country have
understood that we live in a world which is changing with
almost alarming and immeasurable rapidity. In that
rapidly changing world it has not been good enough, and
it will not be good enough, to adhere to outmoded
assumptions and practices of the past, whether that be on
the part of unions, or government. We have attempted
in this country to harness those forces of change
constructively so that we can both advance our own
interests and be a constructive partner in the region and
the rest of the world.
May I conclude by saying that I would think and believe
many of those thoughts which I've expressed would be
relevant to your own business operations within your own
countries and in your relations, one with the other. And
indeed the very fact that you're meeting together in this
forum seems to me to be indicative of your understanding
of that necessity to work with one another rather than
against one another.
So in conclusion I thank you again for the invitation
that you've extended to me. I wish you well in your
deliberations. Finally, I repeat, I hope that you will
learn from your perhaps brief stay in this country that
Australia is now a different country. We're not just the
lucky country. We recognise that we are a country which
has to be clever and has to live with the rest of the
world, compete with the rest of the world, co-operate
with the rest of the world.
I can assure you that you will find in Australia a
willing partner in your endeavours.
Thank you.
ends