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Wednesday, 25 March 1942

Senator CAMERON (Victoria) (Minister for Aircraft Production) .- The developing war-time situation constitutes a supreme acid test of mankind and its institutions. The institution which we are discussing at the moment is the goldmining industry. At the beginning of the war, gold was an essential commodity; it -was necessary for us to have gold in order that we could meet our commitments overseas. But the situation has changed, and now it is not necessary for us to produce gold in order to meet our commitments. As the war-time situation develops, it does two things: it closes down our dispensable industries and extends our indispensable industries. If this did not occur, the war effort could not be carried on effectively. In my opinion, we have not closed down our dispensable industries as quickly as we might have done, and, therefore, our indispensable industries have not been extended as quickly and as effectively as they could have been. The reason for this is that men and women are reluctant to abandon their old ideas. Only when the alternatives become clear - that they must abandon their old ideas or suffer defeat or death - do they abandon their old ideas. One of the old ideas, which, in my opinion, will be abandoned, is that gold is a necessary commodity. The use of gold evolved from the abandonment of what is known as the system of direct barter, under which one commodity was exchanged for another. This system was succeeded by what is known as the system of indirect barter. Then, as the result of experience over the years, gold became accepted as the most suitable medium of exchange and a standard measure of value. That system of exchange continued to operate until the war of 1914-18, but ever since then gold has gradually gone into cold storage, as it were. That system is no longer workable as it was workable when gold was first adopted as a medium of exchange. The old idea to which I have referred was expressed by Senator Allan MacDonald and Senator E. B. Johnston, who said that we must have gold. The fact with which we are faced to-day is that we can do without gold. That fact cannotbe denied. It seems to me that the developing war-time situation has exposed the fallacy of the idea that gold is an essential commodity. I have spoken of dispensable and indispensable industries. The closing down of gold-mines will always be opposed by the "powers that be " if it is possible, during the war, to keep them going as profitably as before the war. However, we are forced now to choose between the profits of gold-mining and the success of the war effort, and " the powers that be" will he literally driven to choose success in the war effort in preference to profits from gold-mines.

Senator Allan MacDonald - I am not interested in profits from gold-mining.

Senator CAMERON - If gold-mining were not profitable, there would be no gold-mines.

Senator Allan MacDonald - I am interested in the poor people who live on the gold-fields.

Senator CAMERON - When a mine ceases to pay, it is closed down overnight.

Senator McLeay - Would the honorable senator keep it in operation after it had ceased to pay?

Senator CAMERON - A mine could be worked if it could break even, but, unless it showed a substantial profit on the capital invested, it would be closed down. The miners would not be consulted. They would be told, as the workers generally are informed, that a matter of that kind was no business of theirs. We see numerous examples in Western Australia, Victoria and other States of gold-mining towns having been abandoned, and of the residents having been forced to leave their homes in order to seek other avenues of employment. Senator Allan MacDonald declared that if gold-mining activities in Western Australia ceased, that part of Australia would be in a state of chaos; but I point out to the Senate that it would still be possible to grow wheat, fruit, and all the other commodities that are essential to the maintenance of a growing population, without gold.

Senator E B Johnston - The honorable senator knows the effect that the closing of the gold-mines would have on the economy of Western Australia.

Senator CAMERON - Any change that may be necessary in connexion with the industry will be due to war conditions. If gold production were abandoned, it would merely involve a reorganization of our internal, economy, involving possibly the adoption of a medium of exchange other than gold. The only occasion when gold is used nowadays Ls in paying our debts overseas. Gold is still used in our international economy, but, I believe that as a result of the war we shall cease to employ it even in our international economy. The demand for man-power is becoming increasingly urgent, and it should be clear to the Opposition that men could be more profitably employed in the construction of roads and aerodromes for national defence than in producing gold mainly for the profit of private shareholders.

I point out to Senator Leckie that the position of the present Government is similar to that of the previous Government. The policy of the present Ministry is being decided, not so much by what it would like to do, as by the exigencies of war. The Government has to meet situations from day to day, as they arise. It has found it necessary at times to change its policy, almost overnight, without consulting the Opposition, in order to meet totally unexpected conditions created by the war. Yet Senator Leckie contends that the people should be told many things of which they are kept in ignorance. It is impossible for the people to be informed of matter's of which the Government itself is unaware. The honorable senator appeared to be much annoyed because the Opposition has not been consulted by the Government regarding the goldmining industry, but the question whether mines should be closed down or whether the production of gold should be reduced has never been discussed officially in my presence. The more widespread the war becomes, and the larger the number of people involved in it, the more will it be necessary to cease producing those things which we can do without.

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