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Wednesday, 27 June 1906

Mr HUTCHISON (Hindmarsh) . - With the accuracy for which, the members of the Opposition are notorious when referring to the Labour Party, we have been twitted with, being gagged in regard to this measure ; but I, for 'one, intend to say something about its provisions, and, in doing so, I shall be only following my leader and other members of the party who have already spoken on the second reading.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - To which leader does the honorable member refer?

Mr HUTCHISON - I have only one leader in this House - the leader of the Labour Party. If a justification were required for the introduction of this measure, i.t has been furnished! by some of the members of the Opposition. The deputy leader of the Opposition, and a number of his followers, have said that they are prepared to vote for the second reading. If the Bill were a bad one, it would be their dutv to oppose it at every stage. Further evidence as to the need for the Bill was furnished by the speech of the honorable member for Mernda. That speech was a remarkable one, and set up a standard of commercial morality which, I think, would not receive the support of the House.. The honorable member, speaking of monopolies, said that, if an individual, engaged in business in a small way, made a profit of 6 per cent., and a large corporation, by adopting different methods, was able to make a profit twelve times as large - that is, a profit of 72 per cent. - the public would not necessarily be robbed thereby.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - He said that such a concern might be supplying the commu nity with cheaper goods than the concern which was making the smaller profit.

Mr HUTCHISON - Exactly, notwithstanding that the larger concern was making twelve times the amount of profit that was being derived by the smaller one. All I have to say is that, if the honorable member set up business in South Australia as a money-lender, and charged such an enormous rate of interest, he would be taken before the Court and a large amount of the extortionate charge would be remitted. I am glad to say that in South Australia an Act of that character is in force.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - The honorable member is misrepresenting the honorable member for Mernda.

Mr HUTCHISON - I am taking the position precisely as he put it, only that the honorable member for Mernda - as has been interjected by the deputy leader of the Opposition - told us that the larger concern might be giving the public as cheap an article, if not cheaper, than the concern which was making the smaller profit. If that were sio, it would show that the smaller man was incompetent to carry on his business, or that his machinery was out of date. But in any case a profit of twelve times 6 per cent. would be an extortionate one.

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - The honorable member for Mernda said it might happen that a firm would make that amount of profit, but he did not say that he approved of it.

Mr HUTCHISON - He did not denounce the making of such a profit, and if he did not- approve of it, it would have been just as well if he had not mentioned it. The honorable and learned member for Northern Melbourne has said that this is not a Bill which will prevent the establishment of monopolies. If it is not, it is, as I interjected, " sham legislation."

Mr Liddell - Does the honorable member think that the Bill will ever be operative ?

Mr HUTCHISON - I will come to that point presently. I think that there is some warrant for the statement of the honorable and learned member for Northern Melbourne, because the Attorney-General interjected that an offender must " wilfully " act to the detriment of the public.

Mr Conroy - Must " wilfully " contract.

Mr HUTCHISON - No. The AttorneyGeneral interjected that it must be proved that an offender has " wilfully " acted to the detriment of the public before he is liable to any penalty. The honorable and learned member for Northern Melbourne, in reply, stated that he did not think it would be necessary to prove that an offender had " wilfully " acted to the detriment of the public to enable him to be brought under the provisions of this Bill.

Mr Higgins - I said that, under the measure as it is at present drawn, one need not prove that an offender intended to damage the public.

Mr HUTCHISON - The honorable and learned member is reported to have said that, as the Bill stands, there is no necessity to prove wilful intention.

Mr Higgins - That is correct

Mr HUTCHISON - That view seems to me to be entirely at variance with the statement of the Attorney-General.

Mr Higgins - But the AttorneyGeneral assured me that if there were the least, doubt about the matter he would) make it perfectly clear.

Mr HUTCHISON - If there is any doubt about it, I hope that honorable members will assist me to eliminate the word " wilfully." Nearly all our industrial legislation contains the word " wilfully," just as- in the provisions of the Constitution relating to the Murray waters the word " reasonable " is employed, and just as in the Employers' Liability Act we find the phrase "serious and wilful neglect." All these phrases mean endless litigation. Within fourteen years after the Employers'' Liability Act of 1881 was passed there were no less than 1,762 actions tried in Scotland alone, in which ,£363,000 was claimed, but only £17,500 was awarded. That seems an extraordinary amount of litigation for a very small result. I believe that the same sort of thing %vill occur under this Bill if we retain the word "wilfully" and such words as " with the design of injuring an Australian industry." If honorable members will look at clause n they will see it provides that -

Any person who is injured in his person or property by any other person, by reason of any act or thing done by that other person in contravention of this part of this Act, may, in any competent Court, exercising Federal jurisdiction, sue for and recover treble damages for the injury.

That provision seems to me to offer a special inducement to manufacturers and other business people who feel that they have been injured in their industry to go to law, in the hope that they may recover treble damages. If the figures that I have quoted can be regarded as any indication of what lawsuits will cost, the less litigation that our manufacturers indulge in the better it will be for their pockets. In the cases I have mentioned both the employers and the unfortunate employes were losers.

Mr Higgins - The honorable member would not put a man in gaol for making an agreement which he thought would injure nobody ?

Mr HUTCHISON - I will deal with that point presently. It has been said that the Labour Party should oppose this Bill, because they favour the nationalization of monopolies.

Mr Wilks - They say that this Bill will be ineffective.

Mr HUTCHISON - The deputy leader of the Opposition said that he could not understand why the Labour Party supported the measure, seeing that its members favored the nationalization of monopolies. But the honorable member knows perfectly well that, at the present moment, there is no power under our Constitution to nationalize monopolies.

Mr Wilks - Why do not the members of the Labour Party tell the public that when they are advocating nationalization? Not a single member of that party has told the public that.

Mr HUTCHISON - It has been made perfectly clear to the people that we intend to seek' that power.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Our complaint is that the Government are helping the LabourParty to make out a case for nationalization.

Mr HUTCHISON - I do not think so. I believe that the Government are satisfied that the Bill will accomplish more than I think it will. Under the circumstances, I am prepared to give it a trial.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Mv remark was a general one. I was referring to the Commissions which the Government have appointed from time to time to inquire into the feasibility of nationalization.

Mr HUTCHISON - Let us suppose that we had the power under the Constitution to nationalize any monopoly. Because we have not the numbers is surely no reason why we should not seek to regulate monopolies until we secure the numbers.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - If we regulate a trust and restore normal competition, we shall make that trust stronger, and not weaker.

Mr HUTCHISON - The stronger we make a trust the sooner it will be nationalized. That is the view of myself and my colleagues. Some honorable members declare that they desire to amend the Bill in Committee, but we know perfectly well that members of the Opposition will, if possible, amend it in the direction of destroying it.

Mr Wilks - Does the honorable member think that he will recognise it when it emerges from Committee.

Mr HUTCHISON - Not if the honorable member has his way. I do not think that the Bill will achieve its purpose for several reasons. We have only to look at the working of the Sherman Act in America, where it has been in operation for sixteen years, to realize that.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Where are the members of the party to which the honorable member belongs?

Mr HUTCHISON - The party are quite satisfied, I suppose, that I am voicing their views. Although the Sherman Act has been in existence for sixteen years, there are more monopolies in America to-day than there were when it became law. As has been pointed out by the Minister, and by the Attorney-General, the measure before the House does not go as far as does the Sherman Act. That Act itself was found to be so weak in operation that it had to be followed by the Wilson Act.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - In some respects the Minister says that this Bill goes further than does the Sherman Act.

Mr HUTCHISON - In some respects it does. The Sherman Act does not deal with some of the matters which are dealt with in the measure under consideration. As the Sherman Act was ineffective, it was in 1904 followed by the Wilson Act, which is certainly a much more drastic measure in some respects. It provides that -

Every combination, conspiracy, trust, agreement, or contract is hereby declared to be contrary to public policy, illegal, and void, when the same is made by or between two or more persons or corporations .... in restraint nf lawful trade.

Then it is different from the Bill before us in that it not only imposes a monetary penalty upon ,an offender not exceeding $5,000, but it provides that "the offender shall be imprisoned". The honorable and learned member for Northern Melbourne wished to know whether I was in favour of imprisoning offenders under this Bill. Most decidedly I am, for the reason that we imprison a man who breaks the law upon a small scale. Why should we differentiate between one law-breaker and another, especially as the Bill provides that an offender must wilfully break the law? Surely we should not extend consideration to a wilful law-breaker. Only the other day I heard the late lamented" Mr. Seddon say that there was only one cure for these offenders, and that was gaol. There is only one cure for them. What is the use of fining a corporation $5,000 or $15,000 if it is making a profit of $1,000,000 a year? It could well afford to pay treble, or even ten times the amount of the fine. But if we put the individuals concerned in the dock-

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - Under the Wilson Act the honorable member would be in the dock himself.

Mr HUTCHISON - Upon what ground ?

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - For increasing the market price of imported articles.

Mr HUTCHISON - I do not see that the Bill will do that. The Ministry claim that it will prevent the dumping of undervalued goods, and in that way alone it may increase prices. That, however, will be a benefit to the community. I would point out to the honorable member for North Sydney that if he were engaged in an industry in which goods were being dumped, and if, as a result, he was thrown out of employment, he would not consider that a benefit had been conferred upon him even if he could purchase those goods at half their former price, because he would not have the money to buy them. I think it is only fair that offenders under this Bill should be placed in the dock. It has been asserted by certain honorable members that some, trusts are beneficent. They have twitted the Minister with being unable to show that there are any injurious trusts in Australia at the present time. Before I conclude mv remarks, I think I shall be able to mention one, at any rate, and I may refer to two or three. The honorable member (for North Sydney, amongst others, stated that the operations of certain trusts were beneficent, but he took very good care not to bring any such combinations under the notice of the House.

The Bill deals only with corporations or individuals that are doing injury to the community.

Mr Wilks - The word "destructive" is used to show that.

Mr HUTCHISON - That is so, and if the operations1 of a trust are beneficent it will not be affected by this measure. I am afraid, however, that we have to take some of these beneficent trusts on trust. I wish to say that experience in every part of the world has shown that, whilst the operations of a combination may appear to be beneficent, as soon as it has grown into a monopoly the consumer is fleeced. We have had scores of instances in support of this statement quoted during this debate. Wei have had a fair discussion upon the measure, and it is right that a Bill of such far-reaching effect should be properly discussed, and that when it gets into Committee we should do all that we can to make it not only a just, but a workable, measure. I say now that I do not think it is a workable measure as it stands. It has been said that under this Bill very large powers are intrusted to the Minister, and powers which might be abused. I do not think there is much danger on that score. I have always voted against giving the Minister administering an Act more power than can possibly be helped, because I believe that we should embody everything we can in a measure when we are passing it. But I remind honorable members that the Minister of Trade and Customs is not being given in this Bill any greater powers than have already been given him under the Customs Act.

Mr KELLY -He is being given greater powers than are given to the Minister under the Canadian Act.

Mr HUTCHISON - This Bill gives him no greater powers than he is given under the Customs A;t.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - The Minister says that it does. The honorable gentleman is not sure of his powers under the Customs Act, and he wishes to make sure of his position under this Bill.

Mr HUTCHISON - I think the honorable and learned member for Parkes will admit that the power of the Minister under the Customs Act is not limited.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - I am taking the Minister's own admission.

Mr HUTCHISON - The Minister, like myself, is a layman, and on such a point I prefer to take the opinion of those versed in the law. I have heard the statement made over and over again that full power is given to the Minister under the Customs Act to prohibit the importation of any goods he pleases.

Mr Kelly - Does the honorable member think that the Minister of Trade and Customs understands the- Act which he is called upon to administer?

Mr HUTCHISON - Undoubtedly, the honorable gentleman understands it, and so well that 1 say there is very little danger in giving him the powers proposed under this Bill. If there were any danger that the powers given to the Minister under this Bill would be abused, I am satisfied that the powers with which he is intrusted under the Customs Act would have been abused before now, especially in view of the low Tariff we have, and the injury which I hold it has worked to many of our industries. Unfortunately, my experience, like that of other honorable members, has been not that the administration has been too strong, but, unfortunately, that, as a rule, it has been too weak. The Minister intrusted with the administration of an Act is very careful not to exceed his powers, because he knows that he can be brought to book by Parliament, and may have to make way for some one else. The honorable member for Grampians said that he thought a handful of people should not require such a drastic measure as this. I entirely agree with the honorable member, but the fact remains that such drastic measures are necessary, and as they have become necessary we should pass them. They are necessary from the very fact that we are but a handful of people. It will be admitted that the resources of Australia are unbounded, and in a country of illimitable resources we should be able to find employment for a mere handful of people. Unfortunately, at the present time we are not able to do so. In almost every department of industry we have unemployed. We have skilled mechanics going about idle, not by the score, but by the hundred.

Mr Wilks - Has the honorable member seen that his friend the Age says that times are booming?

Mr HUTCHISON - I quite indorse what the Age said, and that but still further proves the necessity for this measure. If when times are booming thousands are looking for employment, and cannot find it, it is our duty to do what we can to preserve our industries, in order to provide work for our people. It has been said that no proof has been given of the existence of a monopoly in Australia, but the shipping combine nas been repeatedly referred to. I have had no proof brought before me that the shipping combine is not looked upon by every section of the community, not only as a monopoly, but as a monopoly of a very injurious character.

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - It is supported by the seamen.

Mr HUTCHISON - It does not matter whether it is supported by the seamen or not. Unfortunately, in many cases, as we have seen in connexion with the tobacco industry, the men employed in an industry are afraid to express their views, because, if they did, they would render themselves liable to dismissal, and might also find difficulty in getting another situation.

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - The seamen's organization supports the shipping combine.

Mr HUTCHISON - That may be so, but it is not proof that the shipping combine is not a monopoly. The seamen may honestly think that it is not a monopoly, but we have a better opportunity of studying these questions, and are likely to know more about the matter than is the ordinary seaman, who has about the hardest life of any workman I know. It is also asserted by some honorable members that the tobacco industry is not a monopoly. It is not in the exact sense of the word, but we have had a Royal Commission appointed to inquire into this industry. Its members are more thoroughly acquainted with the whole of the ramifications of the industry than we can claim to be, and yet the majority of the members of that Commission came to the conclusion that the tobacco industry in Australia is a monopoly.

Mr Kelly - They say it is a partial, but not a complete, monopoly.

Mr HUTCHISON - They say it is a monopoly, and that it ought to be nationalized.

Mr Robinson - They said that before they had inquired.

Mr HUTCHISON - Then their inquiry only confirmed them in their belief that what they first asserted was correct. Does the honorable and learned member for Wannon mean to suggest that the members of the Tobacco Monopoly Commission were prejudiced in any way?

Mr Robinson - I say that the evidence they obtained does not bear out their report.

Mr HUTCHISON - The honorable member for Wentworth has supplied me with a copy of their report, in which I find that they say -

We find that the combine is a partial, but not a complete, monopoly.

Exactly ; and this Bill is designed to deal with partial monopolies, and prevent them from becoming complete. The honorable member for Wentworth has only furnished me with additional evidence of the necessity for placing this Bill upon the statutebook.

Mr Kelly - The Commission say that it is not a complete monopoly.

Mr HUTCHISON - Unfortunately, this partial monopoly has obtained such an extraordinary hold of the industry that it is most unfortunate that the measure now proposed was not placed on the statutebook many years ago. I shall quote what, an eminent American writer has to say about the International Harvester Trust, which, no doubt, some honorable members will also say is not a monopoly. I shall show honorable members on the Opposition side of the House the kind of combines they are supporting and doing all in their power to give free play to in Australia.

Mr Kelly - No, fair play.

Mr HUTCHISON - The honorable member may call it any kind of play he has a mind to, but, judging by the opinions to which, he has given expression on many other questions, I doubt whether he is a good judge of fair play. Honorable members probably will know something of the history of the International Harvester Company, and I shall, therefore, quote only a portion of an article by Mr. Alfred Henry Lewis in the Cosmopolitan for April, 1905. Mr. Lewis's article is headed: "A Trust in Agricultural Implements - The Opportunity of the Newly-formed Trust and its Far-reaching Influences," and, amongst other things, he says -

There -were, perhaps, ten American concerns engaged in the manufacture and sale of farm tools and machinery when the Harvester Trust was formed, and of these the Deering, the McCormick, the Millwaukee, the Piano," and the Champion companies were included therein. The list carried the largest plants in the country. There have been added to it since the "Minnie," the Aultman and Miller, and the D. M. Osborne companies.

I may say that the Osborne Company was forced into the combine.

As now framed the Harvester Trust controls over nine-tenths of the farm implement trade, and by methods of extortion, constriction, and law breaking, so dominates the market situation as to compel what opposition is struggling against it to do business at a loss.

This is the company which is doing so much to destroy an important industry in Australia, and which will do a great deal more if its operations are not checked. To confirm what is stated here by Mr. Lewis in regard to the control by this trust of ninetenths of the world's trade in agricultural implements, I may say that the International Harvester Company issued a circular, which I am sorry I have not with ' me at the present moment, in which they claim to have 90 per cent, of the world's trade, and there can be no doubt that they will not be satisfied until they get a good deal more.

Mr Kelly - Is the honorable member not aware that the bulk of the harvesters imported into Australia are those of the Massey-Harris Company ?

Mr HUTCHISON - If that be so we must deal with the Massey-Harris Company in precisely the same way as with the International Harvester Company. I have nothing specially against the Massey-Harris Company or International Harvester Company, as compared with other companies, but I hold that any corporation or trust whose operations afflict our industries should be dealt with. Mr. Lewis, in his article, made reference to the profits that have been made by this extraordinary combination, which has a good many of the American banks and unlimited capital at its back. He says -

It is not too much to say that now in the third year of its existence the Harvester Trust from those $100,000,000 pockets a yearly profit of over $40,000,000, eighty per cent, of which may be counted as merest rapine.

That is the opinion of Mr. Lewis. We all know how the trust bought up the railways. A great deal was made during this debate of the fact that the railways of Australia, being owned by the States, could not be used for the purpose for which railways have been used in America, where thev are privately owned, of securing rebates to private companies. That is quite true, but the shipping combine could assist these trusts to a great extent if they pleased. and does so at present. Dealing with the Bill, and in connexion with the question of litigation, I should like to point out that powerful combinations like these can employ the very best lawyers, and it is a very poor lawyer that cannot see his way through an Act of Parliament.

Mr Wilks - The honorable member is working for the lawyers in supporting this Bill.

Mr HUTCHISON - I am quite aware that this measure will be beneficial to the lawyers. If I were a lawyer it would make my eyes glisten to see a Bill like this. The small man is always handicapped in going to law. I speak from personal experience. Justice can only be obtained if it is bought. Mr. Lewis goes on to say-

Mr Wilks - Who is this Lewis?

Mr HUTCHISON - He is a gentleman who could give the honorable member for Dalley a few points on a matter with which he is thoroughly familiar. He goes on, to say -

If such as the harvester trust were limited to lawful methods, and confined in their dollar hunting to what honest rules of the chase are set forth in the public statutes, not a bit of harm would come from them. It is only when they become criminals, defy justice, stifle competition by villain means, and enslave a market in the teeth of law, that prices go up, quality and quantity go down, and the consumer public is plundered in two ways at once.

That is how this eminent writer describes the operations of this trust. If he wrote that which was not true, of course, the International Harvester Company has its remedy against him, and could have taken him before the Courts of the United States. Honorable members who are opposing this Bill are supporting those gentlemen who have been plundering the farming community. There is no doubt about that. In fact, things became so bad in America under this company that President Roosevelt made war upon it, and so soon as he decided to make war upon it the InterState Commission took its cue from the President, as it usually does. And what was the result? The Inter-State Commission stated that -

The International Harvester Company owns the Illinois Northern Railway. Whatever accrues to that company inures to the benefit of the Harvester Company, its owner, alone. When any of the railway lines leading from Chicago pays to the Illinois Northern Railway Company $12 for the performance of a switching service which is worth but $3 it gives to the International Harvester Company, the shipper of that cartload of merchandise, $q. When the Santa Fe railroad pays to the Illinois Northern $12 for moving a car loaded with the ' traffic of the Harvester Company from the McCormick yards to, its Corinth yard, a service which it might exact under its contract with the Illinois Northern for $1, and when it does this to obtain the traffic of the Harvester Company, it thereby grants that latter company in effect a rebate. It is guilty of an act by which an advantage is given, and a discrimination is produced in favour of the Harvester Company. It is urged that- all this is simply an arrangement between railroads, that there is no negotiation with the shipper, and no payment to the shipper. This is a mere play upon words. The Illinois Northern railroad and the Harvester Company are one and the same thing.

That is the kind of company that is operating in Australia to-day. It is a company with whose methods I am not in sympathy. The same writer goes on, further, to say that -

The trust, with no one to molest it, or make it afraid, will be able to give less in quality, less in quantity - after the frugal manner of the tobacco trust and others of the vulture brood.

I think that is sufficient to show that we have to contend with a very dangerous trust, which has 90 per cent, of the world's trade, and has secured nearly a complete .monopoly in the goods in which it deals. It is high time that we did something with it. The honorable member for Parramatta has said that this Bill means prohibitive protection. Well, I am not a prohibitionist. I believe in a scientific Tariff. But after the experience we have had of the working of the present Tariff, I say that if anything can be done to preserve our iron and other industries I shall be delighted, and shall give .such a measure my support. It will be some time before we shall be able to deal fully with the Tariff. Honorable members do not seem to be very much in earnest about that question. The Ministry are not so much in earnest about it as are the members of the Labour Party. I am quite willing that we shall deal with the Tariff question this session as far as we possibly can. With me it is not a matter for a general election. I have been a consistent protectionist always, and whenever I can do what I think to be right the time is always ripe. I do not think it necessary, Mr. Speaker, to delay the House any further, as no doubt there will be a very long discussion upon this Bill in Committee; but I thought it my duty to give expression to the views which I entertain. Though I am supporting the Bill, I am certainly faT from satisfied that it will be effective. But so soon as we have such a measure placed upon the statute-book we can find out its defects from itsadministration, and if we discover that, so far as it operates, it is doing good, but that the Minister wants fuller powers, I shall be quite prepared to give them to him; whereas, if it is working harm, I am quite sure that the whole House will be willing to aid me in striking out those defects which are complained of. I therefore support the motion for the second reading.

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