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Thursday, 27 May 1926

Senator HOARE (South Australia) . - I agree to a certain extent with the views expressed by Senator M'cLachlan yesterday, with regard to the probable danger of over-production in certain Australian industries, and the difficulty of exporting their surplus products owing to the high .cost of production. But every nation, with the exception of Great Britain, has adopted protection, and Australia, for very sound reasons, is obliged to do the same. The United States of America was not always such a highly organized or efficient nation as it is today. It has attained its present position amongst the nations of the world through the adoption of a sound protective policy, the application of science to industry, and a highly organized system of mass production, which enables the American workmen to receive the highest wages in the world. Germany also is indebted to protection for her position as a highly organized manufacturing country. When first Germany embarked upon protection, articles branded, " Made in Germany " were rejected with scorn, but as time went on, the brand came to be regarded as the hallmark of good quality and cheapness. By subsidizing its manufactures, and by the application of science to industry, the German Government, just prior to the war, had established for the manufactures of its people an enviable reputation. Germany had almost conquered the commercial world. What has been done in America and Germany can be done in Australia just aa effectively. There is, of course, the possibility that, as the result of high pro tective duties, we may have overproduction in certain lines of manufacture, but we ' have heard no such. complaint from the United States of America ' or from Germany. A population of 110,000,000 has been built up in the United States of America, and there has been no trouble through over-production. If we desire to consume all our manufactures here we must double our population. With a population of about 13,000,000 we should probably need to keep in Australia all that we produce here, even to our wheat.

Senator Thompson - Then I take it that the honorable senator is in favour of increasing our population?'

Senator HOARE - Certainly .1 am. I can see plainly that if we are not prepared to bring people of approved white races here, this country will be overrun by Southern Europeans. We should offer every encouragement to the British people, and also to the people of Norway and Sweden, to come to Australia. The Scandinavians are a law-abiding people, and make good Australian citizens.

Senator Thompson - The honorable senator must remember that the Northern Italians are Nordics.

Senator HOARE - I do not dispute that, but there are Nordics and Nordics. Some are undoubtedly superior to others. In my humble opinion the Scandinavians make much better Australian citizens than the Southern Europeans. Several honorable senators have complained that Australia is not progressing with satisfactory rapidity, and that our manufactures are not growing at a sufficiently fast rate. I have said before in this ch;am.ber that our policy of incessant oversea borrowing has a good deal to do with this. If we borrow £20,000,000 abroad, we must expect to have £20,000,000 worth of oversea goods dumped here, and they must necessarily enter into competition with Australian manufactures. I think that no one would be stupid enough to imagine that we could, with success, adopt a policy of prohibitive protection for Australia. We have surplus produce which we desire to export, and we must expect to import some of the surplus products of the countries which buy it from us to at least an equal value; but we could materially reduce our importations by borrowing locally instead of overseas. .Some people thought, before the war, that it would be impossible to raise a big loan in Australia, and they were inclined to sneer at the first efforts that were made during the war to do so. But the first loan of £10,000,000 that was floated was oversubscribed, and subsequently loans running into hundreds of millions were raised on the Australian market. I believe that that surprised, not only the Australian people, but also the financiers oversea, who probably thought that we had an insufficient knowledge of the intricacies of banking to undertake financial transactions of such magnitude. I do not suggest that we had hundreds of millions of pounds in Australia in hard cash. As a matter of fact, prior to the enormous increase in the note issue during the war, the total amount of our Australian notes issue, gold coin bullion, and silver was only £53,777,126; but this money was juggled and rejuggled and credit was transferred from one person to another until it was made to represent credit totalling nearly £300,000,000. If we could raise money like that for war purposes, I think we could do it to encourage Australian industry. Senator Ogden argued that our protective policy, insofar as it applied to agricultural implements, had operated unfairly on the primary producers. I deny that. In New Zealand, as honorable senators know, farming implements are admitted duty free, or practically so, but the farmers there do not get implements at a lower price that the Australian farmers. As a matter of fact, they pay a little more. The following figures will probably surprise some honorable senators : -

Mogul stationary engine, 1 h.p. - Australian price £26, duty 30 per cent. ; New Zealand price £35, duty 10 per cent.

Mogul stationary engine, 2J h.p. - Australian price £52 10s., duty 30 per cent.; New Zealand price £65, duty 10 per cent.

Mogul stationary engine, 6 h.p. - Australian price £125, duty 30 per cent.; New Zealand price £146 10s., duty 10 per cent.

Senator Ogden - From what is the honorable senator quoting?

Senator HOARE - From the Farmers' Tools of Trade and the Tariff. Some figures given in a report of the Tariff

Board bear on the same point. The following details are interesting: -

Orchard disc harrow, 8 x 16. - Australian price £16 5s., duty 25 per cent. ; New Zealand price £17 1.0s., duty free.

Double furrow plough, No. 41. - Australian price £19 5s., duty 25 per cent.; New Zealand price £20, duty free.

The report of the Tariff Board also gives the prices charged for certain implements in the Argentine, which is a freetrade country, and in Australia. The following examples will show honorable senators that farmers in the Argentine are somewhat worse off under freetrade than the Australian farmers are under protection : -

Massey Harris reaper and binder, 6 ft. - Argentine price, £88 5s. 6d. ; Australian, £82. Sunshine harvester (made in Australia), £70.

Massey Harris reaper and binder, 8 ft. - Argentine price, £103 10s.; Australian, £102.

Mower, 3£ ft. - Argentine price, £29 14s.; Australian, £29 10s.

Mower, 5 ft. - Argentine price, £34 13s. ; Australian, £39 10s.

Disc plough, with three furrows. - Argentine price, £49 10s.; Australian, £44.

Disc harrow, 12 x 16. - Argentine price, £23 10s.; Australian, £18.

Diamond harrows, 3 sections. - Argentine price, £14 17s.; Australian, £13 5s.

In only one instance in those figures is the price in Australia higher than in the Argentine. We may take it that the figures given by the Tariff Board are fairly accurate. In the face of them I cannot see how it can be successfully argued that the removal of the Australian duty on imported farming implements will benefit the farming community. I hold that, if the duty were removed, the farmers would be at the mercy of the importers, just like the farmers of New Zealand and the Argentine. There is no competition whatever in farming implements in New Zealand and the Argentine. Before I shall agree to the removal of our duties on these implements I shall require convincing evidence that the farmers will benefit by it.

Senator Ogden - There is keen competition among the importers, as well as among the manufacturers of farming implements.

Senator HOARE - The New Zealand and Argentine experience does not bear out that statement. Our experience with black fencing wire will supplement my argument that the importers will exploit any class of people if they see the opportunity to do so. The farming community, as everybody knows, uses large quantities of black fencing wire. Before a start was made to manufacture it in Australia, the price was £46 a ton; but, immediately after manufacturing operations began here, it dropped to £22 10s. a ton. In the face of that I should not care to leave the farmer to the mercy of the importers, notwithstanding that it is said that there is competition among them.

Senator Thompson - Before the war black fencing wire could be bought here for £9 or £10 a ton.

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