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Thursday, 27 May 1926

Senator GRANT (New South Wales) . - Because people generally are directly or indirectly concerned in tariff revision, I venture to say that there is no question that comes before Parliament in which they take so keen an interest. I disagree very largely with the views expressed by most of the honorable senators who have participated in this debate. To my mind this is 95 per cent, a question of how the national revenue shall be obtained. I know the usual orthodox arguments that are advanced in favour of the protectionist policy; but I also know, and have known for very many years, that a very shrewd type of citizen is most enthusiastic in his protectionist proclivities. I think I am doing him no injustice when I say that his principal object in advocating high tariff duties is to obtain national revenue. I shall advance some evidence presently in support of that contention. On the other hand, I realize that there are many straightforward, honest workers who regard the imposition of duties on goods made outside the Commonwealth as a means of developing industry here, and of providing continuous employment at satisfactory rates of wages. In consequence of the conflicting views that are expressed on this matter, it is difficult for some people to determine their attitude, but, to my mind, the position is as clear as noonday. It must be obvious to persons of even the meanest intelligence - and I do not use that term in any offensive sense - that to the extent that goods are imported into Australia they are not manufactured here. Almost ever since Victoria secured independent government, she has been strongly protectionist in her fiscal policy. I can well remember that in prefederation days Victoria was regarded as the most progressive colony in the Australian group. Many people supported federation because they believed that its consummation would lead to the adoption of a protectionist policy for the whole of Australia. As a matter of fact, that was one of the great levers that was used to secure federation.

Senator Ogden - No bargain of that kind was either made or implied.

Senator GRANT - The great majority of people who supported federation outside of New South Wales, which was freetrade, knew that if they attained their object, the Commonwealth would become protectionist, because all the States except New South Wales were in favour of it; and the fact is that since the achievement of federation until now a protectionist policy has been enforced. We are safe in assuming that high protection will be the policy of the Commonwealth for an indefinite number of years, and proposed amendments in the Commonwealth tariff will always be a matter of very grave concern to the persons who are directly or indirectly interested in this great question. To me it is a question of who is to pay the taxation of the country. I am personally acquainted with the Minister for Trade and Customs (Mr. Pratten), whom I regard as one of the most shrewd business men in the Commonwealth, and one who efficiently represents the class to which he belongs. He knows as well as, if not better than I do, that a policy of protection means a continually increasing revenue. I ask honorable senators opposite, and even those on this side of the chamber, if they cannot see quite clearly that although our Customs revenue is increasing yearly goods manufactured in foreign countries are still being imported in larger quantities. To the extent to which foreign goods come here, so is our policy of protection ineffective. The primary object of this socalled protective policy is to produce revenue.

Senator Sir Henry Barwell - The objective is not to keep all importations out of Australia?

Senator GRANT - No, it is to procure a maximum amount of revenue, and it ought to be clear, even to Senator Barwell, that to the extent to which foreign goods come into the country, so is our policy of protection a failure.

Senator Sir Henry Barwell - I do not admit that for a moment.

Senator GRANT - It is a fact, and would, I think, be admitted by any schoolboy. I am pointing out the practical, and not the theoretical, effect of protection, and can say, without fear of successful contradiction, even by Senator Barwell, that in consequence of the huge imports of foreign goods our protective policy is ineffective. The objective is to produce revenue, and not to encourage the investment of capital and the employment of labour in Australia. Notwithstanding the foolish interjection of Senator Barwell, we received last year in the form of Customs and excise no less than £36,000,000. Surely the learned gentleman must know that foreign goods are coming into Australia !

Senator Sir Henry Barwell - Of course they are, and the intention is not to keep them out, but to collect revenue on those that do come in.

Senator GRANT - I am glad to have that admission.

Senator Sir Henry Barwell - But the Government denies that.

Senator Grant - Who believes the Government? It cannot be denied that the fundamental objective of protection is to secure revenue.

Senator Sir Henry Barwell - The object of a protective tariff is to safeguard efficient industries.

Senator GRANT - The facts are diametrically opposed to the views . expressed by the honorable senator. From the first revenue tariff under which duties on imported goods were collected up to the present, we find that, with very few exceptions, the amount received in Customs and excise has increased.

Senator Sir Henry Barwell - That is merely incidental to a protective tariff.

Senator GRANT - The honorable senator is quite right. It is part and parcel of a protective policy.

Senator Crawford - Provision is made in the schedule for a number of reductions.

Senator Grant - Yes, totalling perhaps, £750,000, which is a mere trifle. Although I am not a prophet, I can safely assume, from returns up to date, that the income this year from Customs and excise will be approximately £4.0,000,000. Any one possessed of even an elementary education must conclude that foreign goods must be coming into the country in large quantities, and yet we are told by Senator Barwell and others, that this is only incidental to a protective policy. The objective of such a policy has always been, and is still today, to place the taxation of the country upon the shoulders of those least able to bear it. I have been informed on the most reliable authority that there are in nearly all the capital cities of the Commonwealth, a large number of men who are unable to secure employment. If, under protection, employment is provided for the Australian people, such a. condition of affairs should not exist.

Senator Sir Henry Barwell - Is the honorable senator a freetrader?

Senator GRANT - I am one of those who believe that the people who own this country should pay the taxation. That is the first article of my political creed. The policy of the honorable senator is that those who do the work should pay the taxation, and those who own the country should get off scot free.

Senator Sir Henry Barwell - Is the honorable senator a freetrader?

Senator GRANT - I should like to know what is meant by a freetrader. If it means a land values taxer, I am one.

Senator Sir Henry Barwell - The honorable senator's views are entirely at variance with those of the other members of his party.

Senator GRANT - The honorable senator's remarks remind me of the position in ancient Egypt, when the wiseacres imposed a tax upon those who grew fig trees, with the result that the fig trees were all destroyed.

The DEPUTY PRESIDENT (Senator Newlands). - Order! I see no reference to fig trees in the bill.

Senator GRANT - Senator Barwell knows very well that in any country where a protective policy is in operation there is always a lack of employment.

Senator Sir Henry Barwell - Such a policy is in operation in every civilized country with one exception.

Senator GRANT - You know very well-

The DEPUTY PRESIDENT. - I ask the honorable senator to address the Chair.

Senator GRANT - The honorable senator was inviting a reply.

The DEPUTY PRESIDENT. - The honorable senator will be in order in replying, provided that he complies with the Standing Orders by doing so through the Chair.

Senator GRANT - It is practically impossible to say when this so-called national policy of protection was first introduced. We know, however, that in France, Germany, Italy, Sweden, the United States of America, and Great Britain, there are a number of honest men able and willing to work, who, despite the national policy of protection, cannot find employment. It is well for us to question whether this system which I am condemning is all that is claimed for it. We are told sometimes that Great Britain is supposed to be a freetrade country.

Senator Sir Henry Barwell - There is plenty of unemployment there.

Senator GRANT - Yes. According to the Estimates .of Great Britain for the years 1924-5, the estimated revenue from Customs and excise was £246,700,000.

Senator Ogden - There is not a wholly freetrade country to which the honorable senator can go.

Senator GRANT - Of course there is not. Great Britain has never had, and is never likely to have a freetrade policy. Those who term. Great Britain a freetrade country know full well that they are misrepresenting the position. It is not today, and never has been a freetrade country. It is a fairly high revenue tariff country. In Great Britain the income tax and super tax yields a revenue of £326,000,000. That is another tax upon industry. Any one who works for an income in Great Britain is pounced upon every year by the income tax collector just as he would be in any other country, and compelled to pay tax in proportion to the services he renders to the community.

Senator Sir Henry Barwell - Does not the honorable senator regard the income tax as a fair tax ?

Senator GRANT - I regard it as a most objectionable, out-of-date, and mischievous form of taxation. It is entirely wrong in its application, and the idea that it is a proper system was exploded long ago by Henry George in his book, Progress and Poverty. I recommend Senator Barwell to read that book and try to understand it, because evidently his views are entirely out of date. Income taxation is only one stage worse than taxation through the Customs house. I can imagine nothing more silly than taxing a man in proportion to the services he renders to the community, while taking very good care to permit the people who own the country to escape taxation. But that is the policy of honorable senators opposite, and it is my purpose to tear aside the veil and expose their hyprocisy.

Senator Drake-Brockman - I thought that the honorable senator's policy was socialism.

Senator GRANT - The first article of my political creed is land values taxation, such as we now have in operation at Canberra. In Great Britain death duties bring in a revenue of £56,000,000. The authorities there are too cowardly to act while the husband lives, but the moment he dies they pounce on the widow, just as we do here, and compel ner to yield up a proportion of the estate left to her by her deceased husband.

The DEPUTY PRESIDENT (Senator Newlands). - I must remind the honorable senator that he is not discussing the Customs Tariff Bill.

Senator GRANT - A great deal of latitude is allowed on this debate, but I have no intention of coming into conflict with your ruling. Those who characterize Great Britain as a freetrade country know full well that they are wrong. The country's balance-sheet shows most emphatically that it is not a freetrade country. As a matter of fact, it never has been, and, so far as I can see, it never will be freetrade because the protection policy is becoming more and more popular there, and soon we shall see repeated there over and over again the conditions that have existed in other countries. Having made these few preliminary remarks let me now remind honorable senators on the Government side of an incident which occurred in the State which I have the honour of .assisting to represent in this Senate. In prefederation days, when Sir John See was Premier of New South Wales, there was a very persistent agitation in favour of a complete alteration in the system of taxation. As a matter of fact, there was a very grave likelihood of the taxation being imposed on the owners of the colony until, to a very large and representative meeting of the citizens, Sir John See made this very remarkable statement: "If we only had a 10 per cent, ad valorem duty on imported goods we should hear no more of land values taxation." That one sentence of his brought more tangible support for a policy of protection in New South Wales than any other statement he could possibly have made, and from that date until the present time that policy has been in force, as no doubt it will be for quite a number of years to come, because the wealthy people know full well that by our national policy of protection they are relieved of much taxation, while at the same time the poorer people are obliged to pay an extraordinarily high proportion of the revenue derived through the Customs House. In fact, that is the basic reason for the existence of our national policy of protection; otherwise we should see even on the Government side of the chamber honorable senators advocating views I advocate. They do not do so because they know that so long as the Treasury can be kept full by means of our present system of taxation there is no possible chance of altering it. Within the last few days the Premiers of the various States have met in Melbourne to confer with the Prime Minister. Why are they here? It is an old saying that, where the carcass is, there the eagles are gathered together. The Premiers are gathered here for the express purpose of deciding how to divide the money collected at the Customs House. Being men of considerable foresight, otherwise they would not be holding their positions, they know very well that no matter what the present Commonwealth Government may Bay about imposing duties for the purpose of protecting Australian industries, foreign goods will still be imported, and consequently an ever-increasing amount of revenue will be derived from the Customs duties. Therefore, like eagles gathered around the carcass, they, are here for the purpose of ascertaining what share of the carcass they will get. If our policy of protection were effective and these hated foreign goods were excluded, no revenue would be derived through the Customs House. But of course there is no idea of excluding them. If a Minister for Trade and Customs were asked to bring in a bill to prohibit the importation of foreign-made goods, he would not entertain the idea for one moment. Neither would honorable senators on the Government side. Their objective is to get the maximum amount of revenue through the Customs House in order to save the owners of this country from paying their just share of taxation. I could understand ' a man in favour of making certain commodities in Australia asking that the duty on those goods should be heavy enough to exclude foreign manufactures, but that is not the policy enunciated by honorable senators who support the Government. They want their so-called protection policy solely for the purpose of getting revenue and avoiding the necessity for direct taxation. No one on the Government side can dispute the accuracy of my statement in that regard.

Senator Sir Henry Barwell - Not to the satisfaction of the honorable senator.

Senator GRANT - If I were to tell honorable senators of a system of national taxation which would fall evenly on all members of the community I suppose I should be out of order, but I have done so recently, and at the first opportunity again, when I am in order, I shall do so, because honorable senators opposite are so stiff-necked and so hard to convince that they require to be told a thing quite a number of times. If an honorable senator is satisfied that a certain reform is necessary, he is justified in drawing attention to it on every possible occasion.

Senator Crawford - But not always before the same audience.

Senator GRANT - That does not matter. I am reminded of a clergyman who was accused by one of his parishioners of repeating the same sermon on many occasions. The clergyman's reply was that the advice given was good, and that he intended to continue to give it until his parishioners acted upon it. It is my intention to remind honorable senators at reasonable intervals of the correct method of taxation in the hope that they will eventually see the wisdom of adopting it.

Some years ago the Parliament decided to impose a duty of 35 per cent, on imported bells, despite the vigorous protests voiced at the time. However, it was soon realized that the impost was a ridiculous one, since musical bells were not manufactured in the Commonwealth, and eventually the duty was abandoned. When the bill reaches the committee stage it is my intention to submit an amendment to the effect that the fittings necessary for such bells shall also be admitted duty free.

The DEPUTY PRESIDENT (Senator Newlands). - The honorable senator is not in order in discussing an item that does not appeal" in the schedule.

Senator GRANT - While bowing to your ruling, Mr. Deputy President, I point out that item 366 deals with musical instruments, including bells, and I wish to make casual reference to the fact that bells require fittings, since they cannot be rung properly without them. A chime of bells is to be imported at no distant date for the University of Sydney, and I am sure that the citizens of Sydney will be delighted when the chimes are heard for the first time - probably when the Sydney Harbour bridge is opened.

For a number of years the most popular form of entertainment in Australia has been the moving picture show, and honorable senators are well aware of the fact that American films are almost exclusively screened. Australian pictures are rarely shown, although the scenic beauties of this country are at least equal to those of the United States of America. The universal presentation of American films in Australia is but a sly method of carrying out undesirable American propaganda. Scenery such as that in The Gorge, near Launceston, and in the timber districts of Tasmania, is very fine. Western Australia, with its splendid timber areas and magnificent beaches, should be made better known to Australians by means of the cinematograph. Victorian scenery is even superior, in some respects, to that of Tasmania, and the mountain and coastal scenery of New South Wales is unsurpassed. Why should Australians have inflicted upon them, night after night, thousands of feet of films dealing with the "skyscrapers" of New York, and the lake and mountain scenery of the United States of America, until they are sick and tired of them? Under our so-called protectionist policy, we have allowed the American picture producers to immortalize their country at our expense.

Senator Crawford - The honorable senator might mention the scenic attractions of the Mandated Territory of New Guinea.

Senator GRANT - -Yes. The scenery of Australia and New Guinea may well be compared with that of America and Switzerland. The following table indicates the large quantity of American films imported into the Commonwealth during the year ended 30th June, 1925, as compared with those obtained from other countries : -


I invite the Senate to return .the bill to the House of Representatives, and ask it to take such steps as will enable Australian picture producers to present scenes from the farming, mining, and dairying districts of this country. It was an American economist who stated that all industries in the nature of monopolies should be controlled by the State or the municipality, and I regard the picture-film industry as one that might fairly be termed a monopoly. Although I am not prepared to say that it should be a State monopoly, I should be very glad if American films were shut out, and Australian films took their place. It may be said that private individuals in Australia are at liberty to enter into the business. They know very well that, confronted as they would be by a very powerful combine, they would have no chance of surviving unless they received substantial assistance from the Commonwealth Parliament. When we reach the committee stage of the bill, I intend to show how this business is manipulated, and how Australian producers are handicapped by the stranglehold of the American film-producing companies.

Senator Duncan - And yet the honorable senator frequently asks us to accept the views of an American economist !

Senator GRANT - I have suggested that a statue of Henry George should be erected at Canberra; but I suppose that, just as visitors to St. Paul's are expected to regard the great cathedral as a monument to Christopher Wren, so will visitors to Canberra, be invited to look around and see, in the working of the leasehold system there, a fitting monument to the principles so ably enunciated by Henry George.

I propose now to direct attention to the increase in the duty on whisky. The proposal is enough to cause a rebellion. As a matter of fact, shortly after the War of Independence grave trouble occurred in the United States of America, because a misguided government interfered with those who resolved to supply their own requirements. The increase in the whisky duties is the most ridiculous and most mischievous proposal that has ever come before this chamber. In the good old days, the import duty was only about 14s. a gallon. This Government, by the increase of 5s. a gallon, has brought it up to 35s. a gallon, with, a corresponding increase in the excise duty. No one has any sympathy with excisemen who go round poking their noses where they are not wanted, to find out if people are endeavouring to make and enjoy the good things in life. It is almost unnecessary for me to state that this proposal will not have my support. It should bring about the downfall of any government that dares to suggest it. A good whisky, mellowed in the wood, is the best drink ever made.

Senator Crawford - Has the honorable senator tried Queensland rum?

Senator GRANT - I have. I have tasted vodka, also the Japanese national saka, and many other beverages; but, in my judgment, there is nothing to compare with a good mellow whisky. Honorable senators opposite dare to deny the truth of this statement, and yet we find them supporting a government that proposes to increase the duty by 5s. a gallon. [Extension of time granted.] It had been said that whiskies manufactured in the Commonwealth are equal to the imported article. All whiskies are good.

Senator Drake-Brockman - It is apparent that the; honorable senator has not been to Egypt.

Senator GRANT - I have no objection to the encouragement of the distillation of whisky in Australia, provided the people who produce it retail it at a reasonable price. If, however, they increase the price, other distilleries will engage in the business, and ultimately consumers will get a reasonably fair deal. This Government professes to be anxious to give encouragement to Australian industries. Ministers and their supporters have a magnificent opportunity to give a practical demonstration of their fiscal faith. It is evident that the Government is not " game " to give effect to its views with regard to the encouragement of Australian industries, because it proposes also to increase the excise duty by 5s. a gallon. When these duties are before us, I shall move for their deletion. There might then be a chance to buy a good Australian whisky at 3s. 6d. a bottle.

Senator Sir Henry Barwell - Does the honorable senator drink Australian whisky ?

Senator GRANT - I drink any whisky, although for certain reasons I have not done so of late. Other items in the bill are worthy of serious consideration. When we are considering the details of the measure, I shall have something to say about them. I do not subscribe altogether to the view expressed by Senator

Ogden that all Customs duties are in the nature of a subsidy to inefficiency; but 1 do not disguise from myself the fact that, sheltered behind a high tariff wall, manufacturers may possibly ' be a trifle slow in bringing their machinery up to date. I entirely disagree with Senator Ogden with regard to piece-work. Applied to certain industries, it may be all right; but as a general principle it is in the nature of sweating, and for that reason I am opposed to it.

I was surprised at the figures, supplied this evening concerning the timber industry. If they are correct, it would appear that the Queensland Government is charging excessively high royalties for the cutting of soft woods. I can quite understand any Government admitting Douglas pine and

Oregon almost free when a royalty of 12s. 6d. per 100 super, feet is demanded for local timber. That should not be tolerated.

SenatorFoll. - That is the minimum; it goes higher than that.

Senator GRANT - Such a royalty should not be countenanced. Twelve shillings and sixpence a 100 super. ' feet is about 33 l-3rd more than the price at which we could buy Australian hardwood and imported oregon in 1914. No wonder houses are dear.

SenatorFoll. - Ready-dressed pine boards are 57s. to 60s. a 100 feet nowadays.

Senator GRANT - I was amused to hear Senator H. Hays say last night that 2,000 men could be employed in the Tasmanian timber industry, but that only 700 were actually working in it. He told us the same thing two years ago. I suppose the other 1,300 men have been out of work ever since. In my opinion there is no timber in this country that can be compared withoregon for certain purposes. Oregon is light, can be handled easily, and does not warp. We could get on withoutoregon, of course, but it seems to me that we shall not do so as long as a royalty of 12s. 6d. per 100 super, feet is demanded for Australian timber.

I listened very carefully to Senator Barwell's speech, for I look upon him as a man who should be able to throw some light on a dark subject?

He told us that the Government policy, as enunciated by the Prime Minister, was sane and reasonable protection for efficient Australian industries. He also said that the incidence of the tariff was unfair to the primary producers, and that he wanted reasonable protection for them. He and his colleagues are cunning gentlemen. You cannot knock them out. What is sane and reasonable protection ? They know what they are about in using a phrase like that. You cannot nail them down to a single definite statement. They are undoubtedly a cunning crew. Is Senator Barwell prepared to admit duty free all the machinery and commodities that the primary producers need ? If he were, and tried to give effect to that policy, he would be turned out of the Nationalist Party. I realize where Senator Barwell stands. He and others like him want a big revenue from the Customs Department so that the wealthy landowners of Australia who, according to the last return, were worth £445,000,000, may escape paying a reasonable amount of taxation.

SenatorFoll. - How would the honorable senator raise our revenue?

Senator GRANT - By straight-out land values taxation without exemptions in accordance with the principle laid down by the immortal Henry George in Progress and Poverty. I know that that does not meet the wishes of all the members of my party. Some of my colleagues, like Senator Findley, are up-to-the-hilt, protectionists. Senator Findley related last night the benefits that the primary producer had derived from a policy of protection. He told us about the local market and a lot of other things. But he omitted to tellus one important thing about this great and glorious policy, so I shall tell it. This policy keeps our national exchequer full to overflowing by levying tariff duties on the manufactures of foreign low wage countries, and so enables our wealthy land-owners to escape taxation. That is why Senator Barwell and his colleagues support the policy. Senator J. B. Hayes and Senator H. Hays, apparently have an ardent desire to protect the Tasmanian timber industry, but I cannot understand why they do not force the Government that they support to exclude Canadian

Douglas pine and Baltic pine from the Commonwealth. If I were as strong on any matter as they appear to be on protection for the Tasmanian timber industry, and the Government which I supported would not yield to my wishes, I should cross over to the Opposition side of the chamber.

Senator Duncan - The honorable senator's party does not do all that he wishes, but he does not cross over to this side of the chamber.

Senator GRANT - There are some differences among honorable members of the Opposition, but we are solid enough when the occasion requires it. I listened carefully to the remarks made by Senator Foll on the motor car industry. In my opinion motor cars are an absolute necessity in these days, and life in Australia without them would be hardly worth living. But, in spite of that, every State Government, and every local governing authority which has the power to do so, imposes taxes on them. A tax of £60 or £70 is levied on every complete motor body that is imported, and it is a wonder that we do not impose a heavy duty on imported chassis. To my mind it is absolutely wrong to tax motor cars. The only justification for it is that it adds to our revenue. The adoption of this schedule is a foregone conclusion. The Government has an absolute majority behind it and can do as it likes. Nothing that honorable members on this side of the chamber may say will have any effect.

Senator Drake-Brockman - If anything sensible is said, we will listen to it. .

Senator Needham - And that is all you will do.

Senator GRANT - It is sensible to ask Senator Drake-Brockman to assist in abolishing the excise duty on locally manufactured whisky, but I do not think he will do so. I propose later to ask him to assist me to remove the duties on a number of articles, but I do not think that he will fall in with my views. My opinion of this protectionist policy is that it is designed by a few of our intelligent men, in order to protect certain wealthy citizens from reasonable taxation, by throwing the chief burden of taxation upon the poorer classes of our community; but I realize that it will be continued, no matter what I may say in opposition to it.

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