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Thursday, 19 November 1936

Senator BROWN (Queensland) . - Although the members of the Opposi- lion do not intend to oppose this measure which is to ratify a trade agreement entered into between the Minister directing negotiations for trade treaties (Sir Henry Gullett) on behalf of the Commonwealth, and Czechoslovakia, we believe that it will not go far in- solving our economic problems. We are justified in pointing out, as my Leader (Senator Collings) so ably did, that, notwithstanding what Senator Arkins has said, the ratification of a treaty between the Commonwealth and Czechoslovakia, Japan, or in fact any other country, will not solve our major economic problems which must eventually be faced. The mere exchange of commodities will not solve them. It is admitted that if t'here is a surplus production of, say, Australian apples, which cannot be disposed of profitably in the local market, there may be some advantage in shipping them to Czechoslovakia in exchange for goods not made here, such as glass beads or similar commodities sold by Woolworth's and Coles'. Some Government supporters imagine that by exchanging commodities in that way we are going a long way towards 'the solution of our economic problems, but the members of the Opposition in this chamber are not likely to be influenced by such futile arguments. I admit that the Bata boot factories in Czechoslovakia, which are turning out 1,000,000 pairs of boots and shoes weekly, are perhaps the most highly organized in the world; but there would be no advantage in insisting upon the exchange of our apples with boots and shoes produced in that country, because such an exchange would be detrimental to the footwear industry in Australia. There would be no real advantage if, as the result of a trade treaty between the Commonwealth and a country such as Czechoslovakia, we should restrict secondary production in this country. A few days ago I was handed a statement showing the effect of the trade treaty with Belgium on the manufacture of glass in Australia. The representatives of the glass manufacturers in Australia contend that as the result of a treaty between the Commonwealth and Belgium the production of glass goods in Australia will be limited. By diverting the supply of goods, previously made in Australia, to Belgium, we are not improving our economic position. Broadly, we should be concerned in increasing the demand in the local market by employing our own people.

Senator Guthrie - Does the honorable senator suggest that we should sell all our primary produce to the workers in Australia?

Senator BROWN - I am pleased that the honorable senator has raised that point. I cannot be accused of being in favour of one-way traffic or of having, what some have termed, a one-track mind. On numerous occasions, I have shown that two-way traffic in trade is essential, and after all the basis of trade is in exchanging commodities for commodities. It is not, as some suggest, that because the balance of trade may be in our favour we are gaining an advantage. If we should be receiving from Czechoslovakia half as much as we are exporting to that country, Australia is not gaining an advantage of 100 per cent, over Czechoslovakia; because, as Senator Arkins pointed out, the difference has to be made up in some other way. The basis of trade is an exchange of commodities for commodities, but by implementing a policy of internal trade development, we shall eventually be exchanging commodities for commodities within our borders. Is that not a greater advantage than exchanging commodities with countries 13,000 miles away? I admit with Senator Guthrie and others that Australia, as a primary producing nation, must seek some countries with which it can exchange its primary produce for other commodities. That must be so, unless we send thousands of persons to Great Britain on joyrides, such as those who next year will be attending the coronation ceremonies, to utilize the credits available there. If we export goods, apart from those in payment of debts, we must accept payment for them in services. Next year from £10,000,000 to £30,000,000 will be absorbed in the form of a service to visitors from Australia to Great Britain and continental countries. Our credits overseas are established by shipments of wool, wheat, lead and other commodities. If we send wool or any other primary product overseas, certain commodities must be taken in return. Consequently we are to manufacture goods previously imported if there must be some limitation of our trade with countries overseas.

Senator Guthrie - Our population of 7,000,000 persons can use only from 10 per cent, to 15 per cent, of our wool production.

Senator BROWN - I am endeavouring to argue the subject from the Labour viewpoint, because it has been suggested, quite stupidly, that members of the Labour party believe in one-way trade. Nothing of the kind. We frankly admit that in the development of an economic system, there must be some limitation because, after all, overseas trade is merely an exchange of commodities. A few years ago, we were told that glassware could not be made in Australia, but to-day it is being produced, and a change in the nature of the trade between two countries has arisen. If honorable senators follow my argument to its logical conclusion, they must admit that by a process of development, Australian manufacturers will eventually be compelled, Senator Arkins or any one else to imply that we are stupid because we are supporting a policy which we know is inevitable. Honorable senators opposite seem to think that we can develop trade within Australia by a system of economic nationalism such as some other countries are attempting, and yet not affect our overseas trade. In one of their magazines they give great praise to the Government because it is steadily improving the internal development of Australia; and it is true that week by week Australia's productive capacity is increasing to such an extent that inevitably we shall be manufacturing all the commodities which we previously imported. When that time arrives, there must inevitably be a diminution of overseas trade. Only a few months ago the Postmaster-General (Senator A. J. McLachlan) referred to the importance of the Australian fishing industry, and to the fact that the Government proposed to place a research vessel in commission so that Australia would be independent of supplies from overseas. To-day, Senator Duncan-Hughes said that the manufacture of motor cars in Australia uneconomic, but it is inevitable that with- in the next ten years, Australian manufacturers will be producing motor trucks and motor cars which will affect our exchange of commodities with the United States of America and Great Britain.

Senator Guthrie - We shall still have to sell our wool overseas.

Senator BROWN - I am only endeavouring to show to the honorable senator that the Labour party is trying to think out this problem, and that it is not dealing with it superficially. It is endeavouring to get down to bedrock in regard to it. I am showing that the intense economic development taking place in Australia must have its effect upon the direction of trade, and if we have been receiving motor cars for Australian goods and decide to make motor cars here in Australia, to that extent there must be a limitation of our foreign market for those goods. There are inevitable forces at work in Australia and on the continent which will show clearly to those who are opposed to Labour's policy before many years have elapsed, the utter impossibility of achieving any deep-seated improvement of our economic position merely by making treaties with Czechoslovakia, Belgium, or any other country.

Senator Guthrie - Is the honorable senator opposing the treaty?

Senator BROWN - No. The honorable senator's interjection shows his lack of understanding. I am endeavouring to show its limitations.

Senator Arkins - The honorable senator does not realize his own limitations.

Senator BROWN - I admit my limitations; that is why I am so successful. I remind the honorable senator that it is a good thing to know one's own limitations. One of my limitations is my inability to penetrate to the cerebellum of each honorable senator opposite in such a way that the points I am endeavouring to make will be understood.

I rose merely for the purpose of supporting my leader in giving this treaty our half-hearted blessing. When Australia has reached the stage at which it has trade treaties with Abyssinia, Italy, Germany, Russia, and, in fact, all other countries, ably arranged by Sir Henry Gullett or some other Sir Henry, and that glorious day has arrived when the Government can sit back in comfort and say that at last it has reached the Eldorado, having made treaties with all countries from Czechoslovakia to Peru, I shall still be able to stand on my feet and say " You have done your best but the economic problems that upset our modern systems are not yet solved ". One of my honorable friends opposite has spoken of the wonders that are to be achieved by the exchange of 30,000 cases of apples for so many cases of glass beads from Czechoslovakia. As I pointed out the other day, if we were to give one extra apple a day to every person in Australia for 365 days of the year it would be quite a respectable total. Seven millions multiplied by 365 - how many cases would that represent ? I do not profess to be very good at mathematics and I leave honorable senators to work out the sum for themselves. But when we speak simply in connexion with these things, honorable senators opposite may more readily understand the position and grasp the point I am endeavouring to make, namely, that if we could frame some policy that would absorb more of the products of our primary industries, even though it may be only apples, it would be a far better policY than that adopted by the Government of sending someone peregrinating over Europe to arrange trade treaties with foreign countries. Nevertheless, the Labour party is not so foolish as to say that merely by confining markets within Australia we shall solve our economic problems. Ex-Senator R. D. Elliott, who was interested in Empire trade, believed that if we confined our marketing within the borders of the Empire we would solve the problem. I pointed out on one occasion that although the United States of America comprises an empire of more than 3,000,000 square miles, and that: with the exception of rubber and a few other commodities, its people could produce all their needs, the problem has not yet been solved in that country. Honorable senators can therefore see the foolishness and stupidity of people who claim that we can solve our problem merely by limiting markets within the Empire. I welcome this agreement because the more agreements we make the sooner we shall have reached the stage where we have exhausted the possibility of error. Possibly the intelligentsia of Australia, as personified in this Federal Parliament, will then seek to frame a policy to meet the situation which, after all, is simply one of utilizing to its full the productive capacity of the people; not to exchange commodities for money, and money for commodities, but to see that everybody in the community has everything that the community can give him. Some day we shall arrive at . a stage in our development when we shall be able to put that policy into actual practice and shall be able to utilize to the full the forces within our own borders primarily for use, and not for financial profits. We have a long way to travel yet before that desirable end is achieved. The nations of the world are indulging in intense economic nationalism and are making trade treaties with one another, but the force of circumstances and experience will at last compel them to re-organize and re-orientate their economic policies. I have- nothing more to add except that I stand solidly by my leader in regard to these matters. As my leader has said, we give our blessing to these treaties, but at the same time we state emphatically that even if trade treaties are made with all the countries in the world, the Government has not taken a real step towards the basic solution of Australia's economic problems.

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