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Thursday, 2 June 1921

Sir ROBERT BEST (Kooyong) . - I have at all times been guided by what I regard as the experience of the world. I ani convinced that strong local industries are the surest guarantee for reasonable prices, because of the competition as between them and the importers. The latter are thus debarred from' exploitation, and internal competition is established. This is 'the experience of Australia, and, indeed, it is the experience of the world. In this case we are anxious to make certain that the iron and steel industry is going to have ample room for expansion. Honorable members have pointed out that at one stage it was thought the industry could do without protection. That was a splendid aspiration; but experience has demonstrated th'at it could not be realized because of the dumping process and this competition from abroad. The fact that there has been expended in the industry something like £5,000,000 is a very sound guarantee of the iona fides and enterprise of those engaged in it. If I thought that the industry would be getting too much of its own way, and become a monopoly, extracting huge profits from the pockets of the people, I would be one of the first to endeavour to check its operations in the interests of the consumers; but my first consideration is to have the industry so firmly established as to insure its expansion to the fullest extent. Therefore, when it has been demonstrated by figures from a reliable source, and facts which cannot be successfully challenged, that the 'industry does require further help, and when I realize that the duty which was offered to it in

March last year is in value about 70 per cent, less than it was then, I think we have a right, as a Parliament, acting in the best interests of the Commonwealth, to make quite certain that the industry is fully protected. The burden of the claim made by honorable members in the Corner, and others who have spoken in opposition to the proposed increase in this duty, is that the real price of the article will be the cost of landing a similar product from abroad, plus the duty, thus making this impost a heavy charge on the community. But, while that calculation may be mathematically correct, it is not the experience of Australia as the result of the establishment of industries here by reason of the adoption of a Protective policy. Furthermore, the experience of America, where the duties on iron and steel products have been more than twice those proposed here, has demonstrated beyond doubt that the imposition of such duties has ultimately brought about, not only the establishment of local industries, but also the cheapening of the article produced.

I want to establish four points, which I shall prove. First, the iron and steel industry of America, which is colossal in its proportions, and of vital importance to that country, could not have been established but for the high Protective wall which was raised there with the object of - its establishment. Second, within a period of five years after the imposition of that Protection, imports fell away to nothing, and the home industries vastly increased, and were able to supply practically all local requirements. Third, the prices charged by the home industry were infinitely less than those which had prevailed previously. Fourth, the effect of the Tariff was to bring down prices throughout the world. These four propositions cannot be successfully disputed. I have the whole of the figures here, and they can be seen bv any honorable member. But Mr. Taussig, a political economist whose fame is world wide, in his TariffHistory of the United States of America, hae made available all the statistics which are indisputable, and I propose to give a faithful analysis of them. He informs us that, in 1871, the United

States of America produced 34,100 tons of steel rails, and imported 506,500 tons. The cost of her own rails was £19 2s.1d. per ton. The cost of the imported rails was £12 0s. 5d. per ton. America paid on all the rails she used of her own manufacture £71s. 8d. per ton in excess of the price charged by the United Kingdom, and 6 and 7 dollars in excess of the duty of 28 dollars (£5 16s. 8d.) which she imposed under the Morrill Tariff. In 1876, after five years' experience of that duty of 28 dollars, during which she established many valuable local industries, she had increased her production of steel rails to 368,300 tons, and had reduced her imports to below 1,000 tons, having in that short period reduced her own cost per ton to £111s. 3d., namely, 19s. 2d. less than she was paying the United Kingdom in 1871. The United Kingdom in this period had reduced her price to £7 17s.1d., or £3 4s. 2d. below the American cost. The Americans continued their 18 dollars (£3 15s.) per ton duty to July, 1883, when it was reduced to 17 dollars (£3 10s. 10d.), where it remained till 1890, when a further reduction to 13.44 dollars (£2 16s.) per ton to 1894 took place. Our British preferential duty is 35s. and 45s. respectively, and intermediate 60s. and 70s. respectively, on rails 50 lbs. and over and rails 50 lbs. and under, as against a United States of America Tariff of 75s. for a nine-year period. The table of American production of steel rails, if followed through to the year 1897, discloses the astounding fact that America, for the first time in her history, produced rails for £41s. 8d. per ton, or 5s.10d. per ton less than the United Kingdom cost. The next year it went still lower, and from 1899 to 1908 - a ten-year period - a ton of steel rails cost £5 16s. 8d.

Mr Jowett - Does the honorable member imagine that the Tariff had anything to do with that result?

Sir ROBERT BEST - It had everything to do with it. It was the result of the operation of the Tariff. I challenge the honorable member to successfully refute these facts.

Mr Jowett - The facts are all right, but the inferences are all wrong.

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