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Wednesday, 27 May 1914
Page: 1467

Senator STEWART (Queensland) . - Before this motion is disposed of there are certain matters to which I would like to refer. I ask honorable senators in all seriousness whether they think the country has been benefited by the course which has been pursued in this Chamber since the accession of the present Government to office? To my mind there are several matters which require prompt attention, not only at the hands of the Government, but at those of this Parliament. Honorable senators cannot take the control of business out of the hands of the Government, and consequently the Opposition is compelled to follow in their wake. Now what are Ministers trying to do ? I. have read the Speech which was put into the mouth of the GovernorGeneral by them, and in it I fail to discover a single gleam of hope, so far as the people of Australia are concerned. There is nothing in it which is of any value whatever to the ordinary man or woman throughout the length and breadth of Australia who desires to make his or her living by the work of hand or brain. It is not a worker's programme. I do not know whose programme it is.

Senator Guthrie - That of the man who wants to stand still.

Senator STEWART - As Senator Guthrie has interjected it may be that of the man who wants to stand still. Now this is an age of progress. Only a short time ago most travelling was done either by boat or horse conveyance. Then came railways and steam-ships, and now we are beginning to fly. If such progress can be made in human locomotion why is it we arc developing so slowly on the social and economic side? The reason is that a certain section of society has determined that things shall remain just as they are, for the simple reason that they are doing very well under the present system. But there is one question at any rate with which the Parliament might busy itself without further delay. It is a question of most urgent importance to the people of Australia, and one which the Government have shelved by relegating it to the Inter-State Commission - I refer to the Tariff. Now, the Tariff has in it great possibilities. As has been pointed out on many occasions, we have in Australia the raw material of every known industry. We have the men and women who are capable of engaging in those industries. We have a crop of young people entering our labour market every year, and we are bound to see that ample opportunities of profitable work are provided for them. But are the Government doing anything in that direction ? They have put the question of the Tariff in the hands of the Inter-State Commission, and it appears to me that that body will be inquiring into it till after the Greek kalends. Perhaps in twenty or thirty years, when we are all dead, the Inter-State Commission will wake up and present its report. When the Bill for the establishment of that body was before the Senate I said that if I thought the control of the Tariff was to be handed over to it, I would not vote for its appointment. I was doubtful even then as to what would happen. But now I am sure. The Government have handed over the Tariff to the Inter-State Commission to save them from taking any hand in putting it through. It is pretty safe to say that Australia believes in Protection. That is the fiscal policy of the people of this country. Now, why do not the Government take the Tariff question in hand and deal with it ? If they did so I am sure they would have the assistance of the Opposition. I am certain that every member of the Opposition would give them all the assistance possible.

Senator Oakes - Does the honorable senator mean to make the Tariff higher or lower ?

Senator STEWART - I will tell the honorable senator if he will cultivate that best of all virtues - patience. The Government profess to be very much superior in talent and business capacity to their predecessors. In fact they hold themselves up to the public as the Government of all the talents. Why do they not take up this question ? The very composition of the Ministry furnishes the answer. They are a hybrid Government. They are composed of Free Traders and so-called Protectionists.

Senator Oakes - So was the last Ministry.

Senator STEWART - I am not referring to the last Ministry, but to the present one. I dealt with the last Ministry when they were in power. Let us take the members of the Government in this Chamber. Senator McColl is a Protectionist, and Senators Millen and demons are Free Traders. In the other Chamber there is the Prime Minister, the Hon. Joseph Cook. We all know what he is, or was. He used to be a Free Trader of the most extreme type.

Senator Lt Colonel Sir Albert Gould - So was Senator Stewart.

Senator STEWART - That was before I had my eyes opened. I did not know very much then. When I was a Free Trader I knew very little about the conditions of Australia. I was in exactly the same position then, as Senator Gould is now. Then there is Sir John Forrest. He is a Protectionist. I do not know what is the attitude of the AttorneyGeneral on the fiscal question.

Senator Blakey - He is a bit wobbly.

Senator STEWART - My impression is that he is wobbly on a number of questions. There is only one matter upon which he is at all steadfast, and that is in his opposition to any progress. Then there is the Minister of External Affairs, the Hon. Patrick McMahon Glynn. My impression is that he is a Free Trader. The Minister of Trade and Customs, the Hon. Littleton Ernest Groom, is a Protectionist of a kind. The Postmaster-General, the Hon. Agar Wynne, is, I think, a Free Trader.

Senator McColl - He is a strong Protectionist.

Senator STEWART - I remember that he made a speech some time ago in the House of Representatives, in which he advocated the imposition of duties upon tea and kerosene, and I therefore came to the conclusion that if he was not a Free Trader he was aRevenue Tariffist. Then there is the Honorary Minister, Mr.

Kelly. I do not know what he is.

Senator Oakes - A Free Trader.

Senator STEWART - Then the members of the Government are principally Free Traders. There are only two or three strong Protectionists amongst them. These are the Treasurer, Senator McColl, Mr. Groom, and Mr. Wynne. All the rest are Free Traders, and apparently their influence in the Cabinet has outweighed the influence of the professed Protectionists. But it seems to me that, no matter what may be the fiscal opinions of Ministers, it is their duty to carry out the policy for which the people of Australia have declared, and undoubtedly that policy is one of Protection and not of Revenue Tariffism. The electors have declared for a fiscal policy which will give us less revenue and more industries. That appears to be the crux of the whole question of Protection. The only reason why the Labour party desire a Tariff is to create industries. If one digs into the history of Tariffs he will find that in the early days of Tariff legislation the object in view was not the creation of industries, but the getting of revenue. The one idea in the minds of those who first initiated Tariff legislation was to shift the burden of taxation from the backs of the rich on to the backs of the poor. Unfortunately that is the position in which we find ourselves today. Although the great majority of the people of Australia tolerate a Tariff for no other reason than to create industries, yet we have the most extreme revenue Tariff in the whole world. The only other country that gets more revenue per head from its Tariff is New Zealand. In the United States, whose industries have been largely built up under a highly protective Tariff, the revenue yield is only about 25s. per head ; whereas our Tariff returns about £3 a head, and the New Zealand Tariff yield is slightly over £3. The Tariff of Germany, which is a strongly Protectionist country, brings in about 15s. per head; and that of France yields also under £1 per head. The Australian citizen, therefore, pays much more by way of taxation through Customs and Excise than does the citizen of any other country except New Zealand. Why does this go on ? Why do not the Government give effect to the policy which the people have laid down for them ? Do they think the people so foolish or gullible as to overlook their fault? I remember warning the last Government about the dangerous course they were pursuing in omitting to deal with the Tariff. Everybody knows the consequences of their inaction in that regard. I believe if they had dealt with the Tariff in a proper fashion they would not now be in the cold shades of opposition. Unless the present Government take action, I am certain they will meet the fate of the last.

Senator Findley - The late Government did all they promised to do.

Senator STEWART - They did nothing. When the honorable senator was in Opposition he described himself as a Himalayan Protectionist, a towering Everest of Protection, under whose shades the millions engaged in large protected industries might recline; but when he became a member of the Government he dwindled to a very small mole-hill. I wish to say nothing about the last Government. It is dead and buried. I am dealing with the present Government, not that I expect much from them, but because I conceive it to be my duty to tell them how they might profitably use their own time, and the time of the Senate, instead of trifling it away in futile and useless discussions, and on Bills such as they propose to bring before us. Here is something that will do good to the people. We want population. Have honorable senators ever asked themselves if we are in a position to defend ourselves? We are barely 5,000,000, with a huge continent to develop. We have within our own boundaries material for every conceivable industry, yet last year we imported nearly £80,000,000 worth of goods. At a very moderate estimate, we might easily have produced at least half of those commodities ourselves. That is the policy which the people of Australia want carried out. Are the various Governments going to continue to defy the wishes of the people? If they do, I can assure them that, one after the other, they will all come deservedly to grief. Why do not the present Government deal with the Tariff ? Why have they handed it over to the Inter-State Commission? One reason is that they see, as clearly as honorable senators do, that we shall soon be in financial difficulties. Our expenditure is going up by leaps and bounds, while our revenue is not increasing in the same proportion. There can be only one end to such a condition of affairs. The Government are afraid to touch the Tariff because they fear to lose revenue; but if we lose revenue through altering the Tariff, there are other ways of raising it, very much fairer and more humane, and much more in the interest of the people themselves. Under our present system, the principles which ought to govern taxation are completely inverted. We ought first to begin with the strong, and go down gradually, as our necessities compel us, to the less strong, and only in the last extremity should we appeal to the poorer people. That is a principle with the theory of which every one will agree. It is exactly the same principle that we apply to defence. When we want soldiers for the army, we draw upon the strong and athletic, and leave the aged and infirm to be called out only in the last extremity. That is an excellent principle, the common sense and utility of which must appeal to every one. The same principle ought to be applied to taxation. Go first to the fit, to those who are able to contribute to the cost of government, and when we have exhausted them, go down the scale. Instead of this, we begin with the poorest, and only in the last resort do we tax the rich. The more income or possessions a man has, the less he contributes in proportion.

Senator Oakes - The last Government did not say so.

Senator STEWART -I am not troubling about the last Government now. I said what I had to say to them to their face, while they were on the Treasury Bench.

Senator de Largie - Why have you been so silent since they left that bench?

Senator STEWART - I am not silent now. I am saying what I have to say to the present Government.

Senator de Largie - This is the first time you have spoken for a long while.

Senator STEWART - It is of no use to be continually barking. I am trying now to tell the present Government what I think to be their duty, just as I told the last Government theirs. Under present conditions, a man earning £3 a week, with a family of five - his wife, himself, and three children - actually pays £15 per annum to the Commonwealth revenue through Customs and Excise, because the average Tariff yield per head throughout the Commonwealth is £3.

Senator Lt Colonel Sir Albert Gould - That is usually the effect of a Protectionist Tariff.

Senator STEWART - We shall discuss that later.

Senator de Largie - The honorable senator will not be given the opportunity.

Senator STEWART - I am trying to show the taxation paid by the poor man as compared with that paid by the rich. Here is a man who earns £150 a year, £15 of which he has to pay away in taxation.

Senator Lt Colonel Sir Albert Gould - Some one else may pay a portion of it.

Senator STEWART - I am taking the average. That is the only thing I could do. This particular family may pay more or less than £15, but I take the average, and this man, with a family of five, has to give five weeks' wages to the tax gatherer. Now I take the case of a man who receives £1,000 a year, or £20 a week.

Senator Lt Colonel Sir Albert Gould - Why not average the whole lot?

Senator STEWART - I am giving the honorable senator two averages. If he is not satisfied with my way of dealing with the matter, it is open for him to get up and give his own view later. I take the case of a man earning £20 a week with a family of five. I assume that, instead of paying £3 per head for this family, he pays £4, because, as a rule, rich people pay a little more through the Customs than do the poor people. That would make his payment £20. I assume that he pays an additional £20 in the shape of income tax. In some States this taxation would be more, and in others: less. His total taxation would be £40 per annum, or two weeks' income.I ask honorable members to mark the difference. The poor man, getting only £3 per week, has to give five weeks' labour to the tax gatherer, whilst the man getting £20 a week has to give only two weeks' earnings.

Senator Mullan - If the honorable senator errs at all, it is on the side of moderation.

Senator STEWART - I am deliberately understating the case. The average wage of the worker is much more nearly £2 per week than £3, and the burden upon a man receiving only £2 a week would be much heavier than even upon a man getting £3 per week. Looking at the matter broadly, it may be laid down as an axiom that the poorer a man is the heavier this kind of taxation presses upon him. In a democratic country such as Australia is it is clearly the duty of the Government to see that the burden of taxation is placed on the broad, strong shoulders of the rich, or, at all events, a very much greater proportion of the burden than the rich are asked to bear at the present time. In doing this the Government would be killing two birds with one stone. They would not only be relieving the poor from a most inequitable burden of taxation, but would be doing something which would create new industries throughout the Commonwealth, and stimulate those now in operation. It would put fresh life into our social and economic system.

Sitting suspended from 6.30 to 8 p.m.

Senator STEWART - This matter of the incidence of taxation is of much more importance to the people of Australia than are the trifling matters which the Government have called upon the Senate to consider. I do not know whether the Government are prepared to put their professions into practice, but I ask this professing Government to begin to deal with this question. On the subject of the inequality of sacrifice demanded from the various citizens, let me say that honorable senators will agree that we all profess to be equally anxious to legislate in such a way that the poor man shall be given the best show possible, and that the burdens imposed upon him shall be of the very lightest character. If that be the case, we have here an excellent opportunity to relieve the poor man to a great extent of the serious burden of taxation now resting on his shoulders. We should remember that it is the poor working man with a big family who suffers most unfairly under the existing system. Any honorable senator who wishes to discover the facts for himself may do so by consulting Mr. Knibbs, who shows, on the authority of statistics, what we all know as a matter of fact, and that is that the workers have the biggest families, and that very often the poorer a worker is the bigger is his family. Here, then, is something which, if Parliament acts wisely, must make itself felt in every home in the Commonwealth. I have pointed out the difference between the taxation paid by the poor working man and by the comparatively wealthy man. The poor man earning £3 per week under the existing system has to work five weeks to pay his quota of taxation, whilst the man getting £1,000 a year has to work only two weeks to pay his share. Is that a fair thing? In taxation there should be equality of sacrifice.

Senator Blakey - Is not that an argument against Protection?

Senator STEWART - I was going to say that the honorable senator is not a Protectionist, but, perhaps, what I ought to say is that he does not seem to understand what Protection is.

Senator Gardiner - Put simply, it is making the many pay to make the few rich.

Senator STEWART - I wish to impress upon honorable senators the fact that the present system of taxation presses with undue severity on the poor. Senator Blakey apparently thinks that our Tariff is a Protectionist one.

Senator Blakey - No; I think it if a mongrel Tariff.

Senator STEWART - My objection to it is that it is not a Protectionst but a Revenue Tariff. I desire to see it altered, because, by making it a Protectionist Tariff, we shall not only create a large number of new industries, and stimulate those we have, but we shall get less revenue from it, and in consequence be compelled to go where we ought to be going now for our revenue, and that is to the people who are able to pay taxation. That is a principle that every politician, who professes to be a patriot, ought to support. Every Labour man is bound by the planks of his platform to support it. I do notthink we have a plank in the Federal platform to that effect, but I know that in the Queensland Labour platform there was a plank which read, " The re-adjustment of the incidence of taxation." This is important, not only from the financial, but from the industrial, aspect. It is important as affecting, not only our primary industries, but also the national wealth of the continent. I would ask the Government to take up the question of the Tariff and deal with it. Their reply will be that it has been remitted to the Inter-State Commission. Do not the statistics before us supply sufficient evidence to convince any unprejudiced man that we are importing very much more into this country every year than we ought to import? Per head of population, Australia is the largest importer of any country in the world. That does not only demonstrate, as some would have us believe, that we are the best-off people in the world. While I admit that, I say that it demonstrates also that we are importing a great many things which we could, and ought to, manufacture for ourselves. The only means by which these huge importations can be lessened is by an alteration of the Tariff. Are the Government prepared to alter the Tariff in a Protectionist direction? I do not think they are. I ask them to do so, but I know perfectly well that they have no intention to do anything of the kind. They know that if the Tariff is altered in a Protectionist direction a reduced revenue will be the result, and they know further that if they get less revenue through the Customs they must get more from some other direction, and the only other direction which I think would be permitted by the people of Australia is an increase of our land value taxation. This financial aspect of the question has a strong bearing on our industrial and social life. The present system permits individuals and companies to hold up huge areas of land in every portion of the Commonwealth. Very little taxation is imposed upon them. The only land value tax of any consequence that has been imposed is the Federal land tax. The Labour party is entitled to all credit and possible praise for making that beginning. Where I find fault with the last Labour Government is that it did not go further by increasing the tax and making it effective. But that duty devolves just as much on the present Government as it did on the last Government. We want to change the incidence of taxation ; that is number one. We want to free the lands of the Commonwealth; that is number two. And we want to establish a large number of secondary industries from end to end of this continent; that is number three. Surely that is a policy which ought to appeal to every member of the Senate, whether he belongs to the Government side or to the Opposition side! I know perfectly well that the Government will not touch this question. Why ? Because it is supported by the manufacturers largely. I know that a number of manufacturers are appearing before the Inter-State Commission, and giving evidence that they are quite satisfied with the present Tariff, and that they do not want any change. That may be evidence to me and to members of the Senate that under the present Tariff these manufacturers are making a profit, but it is not evidence against raising the Tariff in a Protectionist direction. What these men fear is that if we had an effective Tariff from a Protectionist point of view, capitalists from the older countries of the world would come here, and, with the large amounts of money at their command, enter into various businesses, instal the latest machinery and the most modern industrial organization, and thus crush them out of the field. The only point that ought to weigh with this Parliament and with the people is this: Are we importing goods that we could very well make here? I submit that We are. I think that any man who gives any consideration to the subject will agree that that is the case. I do not hope for anything from the present Government. I believe that agitating the question here may have some effect, if not on the Government, at least on some section of the electors. Now, the electors are not fools. They know perfectly well the burdens under which they stagger. They know, too, that they have been promised relief time and again, and have been deceived. If we are not to stand convicted as humbugs and hypocrites, surely the time has arrived when we ought to do something in this matter ! I have spoken so often here on the question of land monopoly that I am almost ashamed to be time and again bobbing up with what an ex -senator used to call King Charles' head. I believe now, and have believed ever since I was able to come to a sensible conclusion, that this is the most important subject that can occupy the attention of the people of Australia. I believe that land monopoly is literally strangling the progress of the continent. Here we have a population of barely 5,000,000 holding one of the finest portions of the earth's surface with huge, empty areas in every State of the Union. Yet we find that it is one of the most difficult things imaginable for a man to get land in any State, even in the youngest and least settled of the States. Some time ago I gave instances where selections were thrown open in various States. What happened in Queensland a short time ago ? Five grazing farm selections were thrown open at a place called Welltown How many applications were there, do honorable senators think? From every State in the Commonwealth came applications, numbering in all 900, for five paltry grazing farm selections.. Again, about a month ago, three selections were thrown open on Portland Downs, a station in the central portion of Queensland. Although no applicant was allowed to apply for more than one selection, yet 710 applications were sent in. There you have over 1,600 applicants for eight grazing farm selections. Some persons will tell me that a large number of the applications were bogus. Suppose that 1,500 of them were bogus, the disproportion between the bond fide applicants and those who were able to get land would still be outrageous. Suppose that there were only 100 persons out of the 1,600 who really wanted land, a state of affairs exists which is not only a disgrace to the Commonwealth, but is retarding its advance in every shape and form. Another question comes in here. We hear a great deal about the increased cost of living. Here were 1,600 individuals who were prepared to go into the industry of growing sheep and cattle, but only eight of them could obtain land on which to do so. Need we wonder that the price of meat is going up. If there was no American Beef Trust or other trust is it not reason enough for the advance in the price of meat that land on which cattle and sheep can be reared has become so scarce that only a comparatively small proportion of those who are willing to engage in the industry can find land on which to operate? There is another aspect of the question. Probably Victoria is the State more ridden by land monopoly than is any other State in the Commonwealth. According to the Victorian Tear-Book for 1910 - the latest I can get - the total holdings in this State were 60,240. The holdings from 1 acre to 3130 acres numbered 40,888, and the holdings over 320 acres numbered 19,352. The average area of the holdings up to 320 acres was 110 acres, and on this area the bulk of the cattle are reared and the bulk of the produce of Victoria is produced. The area owned by private persons with holdings up to 320 acres is 4,523,324 acres, the average holding being, as I have pointed out, 110 acres. The area owned privately by persons with holdings larger than 320 acres is 21,877,494 acres, the average holding being 1,120 acres. A very common objection taken to the proposal to split up our land monopoly is that people cannot make a living on a small holding - nothing less than several hundred acres is any good. Yet in Victoria we have over 40,000 persons living on an average holding of 110 acres, and living comfortably, I presume. The larger proportion of these holdings, I believe, would be under 110 acres. That proves up to the hilt, I think, that it is not necessary, at least in Victoria, for persons to have anything more than what may be termed a comparatively small holding. I find that in Tasmania the number of small holdings is very large; I cannot give the exact number, because the Tasmanian statistics are not very definite, but I gather that there is quite a large number of small orchards and potato farms throughout the State. The number of small holdings in New South Wales, I believe, is also comparatively low. I find that everywhere throughout the Commonwealth a very large proportion of the produce is grown, as is the case in Victoria, on what might be termed comparatively small holdings.

Senator Rae - That specially applies to where the land is good and the rainfall is adequate.

Senator STEWART - As the honorable senator interjects, this specially applies to districts where the rainfall is good, and where there are other advantages. It is in these districts very largely that the best land is monopolized. I would like to impress upon honorable senators that a very large proportion of the small holders in every State are placed in a most disadvantageous position as regards making a living. They are very often far from a railway line. The land they occupy is almost invariably indifferent, and in many cases they are outside the rain area or on the fringe of it. The best lands in Queensland, largely in New South Wales, and certainly in Victoria and Tasmania, are owned principally by what may be termed comparatively large holders. There is the position as it appears to men The best lands of the continent are to-day held by monopolists. The wonder to me is that our agricultural and pastoral industries are as prosperous as they are. It says a great deal for the climate of Australia and for the dogged determination and perseverance of the settlers. It has often been said, and said with a great deal of truth, that the farmers look upon the Labour party as their worst enemy. Very often people think that some one who is really their worst enemy is their best friend. The Labour parties in Australia, Federal and State, are the best friends that the farmers ever had. The farmers, unfortunately, labour under the delusion that the Labour party wishes to tax them off the land. We wish to do nothing of the kind. We want to tax the speculator, the monopolist, who now holds the land, to such an extent that he will be compelled to sell to the bona, fide farmer at a reasonable price.

Senator Guthrie - Or use the land himself.

Senator STEWART - Exactly. I wonder whether the unfortunate farmer who has to buy land at anything from £10 to £100 per acre has ever calculated how much the monopolist taxes him. Take, for example, a piece of land the true unimproved value of which probably amounts to no more than £2 per acre. The monopolist holds on to it until a railway is built, and until all the other advantages which spring from communal action have been realized. He then sells the land for £10. per acre. That happens every day of the week in Victoria, and, I am sorry to say, in almost every State of the Commonwealth. Just consider how much that means as a tax on 100 acres of land. The 100 acres are sold for £1,000. Now, in many cases, £S00 of that sum would represent the communitycreated value. Capitalize that amount at 5 per cent., and it represents £40 per annum. That is the tax which the monopolist of private land imposes on the unfortunate individual who buys from him. Upon 100 acres it would represent about 8s. 6d. per acre. That is a tax such as the Labour party in its wildest dreams never thought of imposing upon anybody. Yet it is the tax that the private land monopolist imposes upon the unfortunate persons who are compelled by circumstances to buy his land from him. Then this same monopolist is looked upon as a tin god, and people bow the head and bend the knee to him. What the farmer wants is to get on to the best lands of the Commonwealth. As I interpret the policy of the Labour party, it is that the small agriculturist is entitled to every advantage of land and situation and climate which the various Governments of Australia can give him. Undoubtedly the man who settles on the land is the backbone of the country, and the Labour party recognises that just as does everybody else. If he is to get the best out of his industry, he must be given the best available opportunity. But he does not get that now. I am sure that every honorable senator has considered this question. How is it that the sons and daughters of .farmers are continually drifting into our big towns? Is it that life is better in the city, or is it because, owing to land monopoly, opportunities are not available in the country? I believe that nine out of ten farmers' sons who come to the city looking for work as railway porters or policemen, are driven there by land monopolists. What chance is there for the young working farmer's son to obtain land in Victoria, with land commanding £30, £40, and £50 per acre? Take an average holding of 100 acres. At £20 per acre, an outlay of £2,000 would be required to purchase it. Where is the working farmer who can hand over that amount to his son to enable him to purchase a farm, quite apart from stocking it? As a result, the farmers' sons drift into the city. We all deplore that. They are the best men possible to settle on the land, because they have been there from their youth up. Yet here we are scouring Great Britain, America, and the Continent in search of what we are actually destroying at our own door by our insane and unjust system of land monopoly. That is the system which the Government are pledged to support. They live on the trusts and combines, and on every one of these greedy, grasping, plundering organizations. Whatever may be the private opinions of Ministers, they dare not lift their little finger to touch these organizations. But I say that the Opposition have no such responsibility towards any organization. Their masters are the people. They are pledged to see these things carried through; and I am certain that if the people of Australia give them another opportunity, they will not neglect it.

Senator Lt Colonel Sir Albert Gould - The Labour party had three years of office last time.

Senator STEWART - And they did very good work, although they might have done better. I trust that when they get another opportunity they will not neglect to do better.

Senator Rae - We will shake things up.

Senator STEWART - If I am here I will shake them up. I have said that this question is the most important which can occupy the attention of the people of this country. Look at our cities. They are bloated and overgrown. Half the people of Victoria live in the city of Melbourne. Half the people of this continent are living in the cities. Yet there is no better place in the world than Australia for the people to live in the rural areas if only they had the opportunity to do so. But wherever my feet take me, this one damning thing - this blood-sucking dragon of land monopoly - meets me at every step. If I go to the northern part of Queensland I find it there; in' the western part of that State I meet it; in New South Wales I find it, too ; and when I come to Victoria it is gnawing the vitals out of the people here. It is in Western Australia, and also in Tasmania. Tasmania cannot keep her population. As soon as a hundred children are bom, about 150 grown-up persons leave that State. They cannot live there owing to bad .government. I trust, however, that under the Labour Government which has now been installed there, things will take a turn, and that Tasmania will not only be able to keep the population she produces, but will be able to attract a great many more people. That State is probably one of the finest portions of the Commonwealth. I look forward to the day when it will be the great industrial centre of the Commonwealth. It has resources, so far as the development of water power is concerned, that no other portion of Australia possesses, and I am quite sure that its people, having had a taste of good government as presented by Labour, will, like Oliver Twist, demand more and more of it. There is one thing which the Tasmanian Government have done which deserves commendation - I do not know whether the transaction has yet been completed, but if not, I hope it will be - I refer to its purchase of all the rights possessed by the hydro-electric company. That will give the Government of that State a control over the water power, which may be utilized to very great advantage in the interests of the people of that portion of the continent. I do not think I need say any more on the question of land monopoly, except to add that land value taxation is not taxation at all. It is the community-created value passing into the public Treasury, where it ought to go instead of into the pockets of private individuals, where it now goes, and where it has no right to go. I do not wish to labour this question. The only factor which gives a greatly added value to land is the presence of population. We had a case in Melbourne not long since of a small block of land which had been let many years ago on a building lease at £3,000 a year. That block was recently sold for about £65,000. I say that that £3,000 was community-created value, pure and simple. It was taxation imposed upon the community of Melbourne and Victoria by private individuals. That represents1 a state of things which ought not to be allowed to continue, and which cannot be allowed to continue if the country is to prosper as it ought to do. In Australia we have spent hundreds of millions of pounds in building railways, constructing roads and bridges, and in establishing postal and telegraphic services, not to mention schools and various other institutions. Each one of these has added to the community- value of the land. Yet up to the present, with the exception of a very small proportion, the whole of the vast annual sum which has been created by these improvements is finding its way into the pockets of private land-holders. I have gone into the matter fairly closely, and I find that a sum somewhere between £20,000,000 and £30,000,000 per annum of community-created values is finding its way into the pockets of private individuals. I think that I have understated rather than overstated the amount.

Senator Rae - The honorable senator is well under the mark.

Senator STEWART - In a calculation of this kind it is better to be under the mark than to be open to the charge of having exaggerated. Surely this is a leak which ought to be stopped. I say that about £25,000,000 per annum, which should find its way into the Treasury, is at the present time passing into the pockets of private individuals. We are spending over £2,000,000 a year upon old-age pensions, which honorable senators opposite would abolish if they could.

Senator Millen - The honorable senator knows that that is not correct.

Senator STEWART - They hate them as the devil is said to hate holy water. I have forgotten how much is annually expended on the maternity allowance. Yet honorable senators opposite exhausted all their eloquence and ransacked the dictionary for words to describe the iniquity of the maternity bonus. We cannot give £5 to a woman who has performed one of the chief functions of nature without being exposed to obloquy by honorable senators on the Ministerial benches. Will they tell me that the oldage pensioner does not deserve the dole he gets from the Government? Has he not lived and worked in Australia for thirty or forty years, perhaps more? Is not a woman who adds to the population of this country worthy of the amount that we pay her? Honorable senators opposite say she is not, yet we pay between £20,000,000 and £30,000,000 a year to people who have done nothing for the country. The man who owned the block at the corner of Collins and Swanstonstreets did nothing towards the development of Australia, except buying that allotment, yet the country is paying him, or his heirs and successors a donation which probably amounts now to £4,000 or £5,000 a year, and many of those heirs are probably absentees. This is the acute and vital difference between those now on the Government bench and we who sit on theLabour benches. They grudge the dole to the old-age pensioner, and the woman who gives birth to a child, but they lavish the wealth of the community on the idle, unprofitable, and wasteful rich. I recently read in a newspaper a suggestion, said to have emanated from a Labour man, although I hope that is not true, that the two parties might combine and work for the good of the country. Fire and water could combine as easily. Their way is not our way. The differences between us and them are so acute and vital that no compromise is possible. The fight between us must be to a finish, and, so far as I am able to forecast the future, I know which party will be the victor. I trust that no attempt will be made by the Labour party to compromise with the party now sitting on the Government benches, or with any party that may evolve out of it. We are after a complete change of the present system. We know what it is and what it has accomplished. I read in the papers almost every day that Socialism has been tried and found wanting. I do not know where that has happened. I do not know where it has even been tried yet; but I know something else, which is quite enough for me - that capitalism has been tried and found wanting. It has slain its millions of people in every country under the sun. It is dealing death on every hand now, and that being the case, the system must be changed as soon as possible. We have come to a period in the history of representative government when there can be no compromise. I hear of a good many nostrums being proposed nowadays to restore the efficiency of the parliamentary machine. The only thing I see wrong with the machine is that the Labour party has not a majority in both Houses. We are told we must adopt the initiative and referendum. I think we have something better at the present moment. We have not the initiative, but we have the referendum at every election on many subjects. When a party is intrusted with power, it is intrusted with a mandate to do, not one thing only, but quite a number of things. To propose to submit every great issue to the people by way of referendum is merely an ingenious device of the enemy to retard the progress of the Democracy. If you submit an important question to a referendum of the people once, and are defeated, you can do nothing until you submit it again, and we have questions ofthe first importance cropping up by the dozen every year. Is every one of them to be submitted to a referendum ? The thing is unthinkable. People would get tired of it. Some people say that the virtues of parliamentary government have been exhausted, but parliamentary government was never so virile in its history as it is now. We never heard about the institution of Parliament being played out until the Labour party became a dominant factor in the politics of this country. Government by Parliament was good enough for our opponents while they controlled Parliament, but now they see the danger of some other power coming into the arena and usurping the position they previously occupied, they make the discovery that Parliament is played out. I believe it is, so far as they are concerned, but so far as the Labour party is concerned, I trust it will not allow itself to be bamboozled by any political nostrums like elective Governments or the referendum. I believe in the initiative and referendum, too, but not as some of our friends would like to see them applied. I have said before in this Chamber, and after thinking the matter over very carefully I see no reason to change my opinion, that, so far as defence is concerned, Australia is attempting the impossible, and doing nothing effectively, while the possible is quite within her reach. She is trying to put a Fleet upon the water and an Army upon the land. She cannot do both. At present she has neither Fleet nor Army, and it is extremely unlikely that she will have either within the next twenty years. Our Fleet is of no more use against even a third-class Power than a cockle-shell would be against a hammer. While we are not able to put an effective Fleet upon the sea, and at the same time provide a sufficient Army on land, if we limit our efforts to one of those we shall be able to do all that Australia, in her present circumstances, can reasonably be expected to do in the matter of defence. If we took every farthing of our revenue we could not provide a sufficient Fleet. It is beyond our circumstances and beyond our power, and we ought, therefore, to abandon the attempt. What, then, is to be done? We can establish an Army. We can provide a system of shore defence which would be sufficient to protect us against any possible invading Power. We have the example of the Boers. Why should we forget the gallant fight they put up against the strongest naval Power in the world?

Senator Millen - How long has the honorable senator entertained this view?

Senator STEWART - I have expressed it here on one occasion previously, and have been expressing it privately for years, as my comrades in the Labour party can testify. The Dreadnought Australia might as well be sent to the scrap-heap now for all the good she is. In fact, any boat that we could build would be merely scrap iron within a few years, but if we drill and train our young men to shoot, provide other shore defence in the way of forts, and duplicate and widen our railways along the coast, we shall do a great deal towards preserving our country against the attacks of an enemy. As things are now, any moderate naval

Power could deal with the whole of our Fleet in about twenty-four hours.

Senator Guthrie - They could do the same with our forts.

Senator STEWART - I believe so.

Senator Guthrie - Then, is it not better to have a movable fort?

Senator STEWART - I do not propose to enter into details. I do not profess to have any military knowledge. Our Fleet at present is worth nothing, and if we poured all our revenue into it it would still be worth nothing. Our Army at the present moment is also worth nothing, but we can put it into such a condition as will enable us to make as gallant a fight against any possible enemy as was ever made by the inhabitants of any country. Let us abandon the impossible, get right down to business, and do what we can do. I am aware that some people contend that we ought to keep up a Fleet, if it were only to add to the British Fleet.

Senator Rae - Yes; where is the honorable senator's Imperialism ?

Senator STEWART - I know that a large number of people in Australia are Imperialists. I do not say that I am an Imperialist. I aman Australian first, and I wish to tell the people of Australia that if Britain goes down, they will have only their own right arms to depend on. And Britain may go down. If Britain's Fleet is not large enough, it is the fault of the wealthy people of Great Britain. If they chose to tax themselves, they could double their Fleet without doing themselves any injury. They might do that if they would only tax themselves for the purpose, instead of spending their money, as very many of them do, in wasteful and wicked extravagance. When I deal with this subject, I always approach it from the Australian point of view; and I have this thought always dominant in my mind, that at the last resort Australia will have no one to depend on but herself. If Britain is unprepared and goes down, as surely as tomorrow's sun will rise, some foreign enemy will come here and try to take possession of this continent. We need not deceive ourselves on that point. The habitable portions of the globe's surface are becoming so scarce and valuable now that the struggle for this empty continent will be a great one, and inevitable unless we prepare ourselves to repel any possible invasion. By increasing our population, by framing a Tariff which will create secondary industries, by breaking down land monopoly, and thus enabling tens of thousands of sturdy farmers and farmers' sons to settle on our lands, and by establishing a land force, we may place ourselves in a position to give a most excellent account of ourselves against any possible invader. I put these thoughts before the Government and the Senate for what they are worth. I say that, instead of frittering our time away talking about a Government Preference Prohibition Bill, a Postal Voting Restoration Bill, and such paltry things, we should turn our attention to big questions, and do something which will increase our population and our prosperity, and that will insure the safety and the very existence of the people of Australia.

Senator McGregor - What about the reduction of the cost of living ?

Senator STEWART - Increased land settlement would help to solve that question.

Debate (on motion by Senator Lt.Colonel Sir Albert Gould) adjourned.

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