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Thursday, 8 July 1915

Senator GUTHRIE - The conditionswere entirely different. Their standard was commodities; our standard is gold.

Senator BAKHAP - I venture to say that the sound, sane laws of economy will have to be followed by every community that desires to escape disaster. It is a singular fact that the operation of the law of the maximum was practically contemporaneous with the reign of terror. The reign of terror began with the establishment of the revolutionary tribunal, and within two months the price of commodities had been fixed. On the 10th Thermidor, Robespierre met his death, and the reign of terror came to an end; and it is hard to say whether Frenchmen breathed more freely because of this, or because of the abolition of the law regulating the price of commodities, which came to an end with the ending of the .reign of terror. Alphonse La Martine wrote- - Senator Long. - On a point of order, I desire to ask -you, sir, whether the very imperfect knowledge that Senator Bakhap is displaying regarding the Trench Revolution has anything to do with the constitutional amendments now before the Chamber?

The PRESIDENT - The question of whether Senator Bakhap's knowledge is perfect or imperfect is not a point of order. The honorable senator has been very discursive, and I have already checked him once or twice; but I do not feel inclined to draw the line very tightly, because the subject is a large one, and honorable senators are entitled to a great deal of latitude in discussing it. At the same time, I am closely watching the honorable senator to see that he does not become unduly discursive.

Senator BAKHAP - I thank you, sir. It must be remembered that there has been no discussion of these proposals from. this side of the Chamber up to the present. Their effect will undoubtedly be so far-reaching, and so subversive of the present principles of our Constitution, that I may reasonably claim a certain amount of latitude in discussing them, particularly as the Minister had extended to him, and properly so, the latitude of discussing the whole range of the six Bills in one speech. My knowledge of the French Revolution is admittedly imperfect; unhappily; my knowledge of many things is imperfect ; but the knowledge of an historian, himself a French President, of the results of the experiments of his countrymen in fixing prices, cannot, except impertinently, be regarded as imperfect. He says -

From decrees of violence, vengeance, and sacrilege sprung these decrees of power, wisdom, and magnanimity. The menacing movements of the people of Paris, who were beset with the reality of famine and the phantom of monopoly,' the ravings of Chaumette and Hebert in the Commune, compelled the Convention to make deplorable concessions which resembled zeal, but which were only weakness. In requiring from the people all their energies, the Convention considered itself also obliged to put up with all their transports.

The Convention wanted all the energies of the people to prosecute the war against the Powers of Europe, and it was perforce compelled to put up with all their false ideas of economics] - " ' It was not, as yet, strong enough to govern its. own force. The Convention decreed a maximum - that is to say, an arbitrary price - above which, no bread, meat, fish, salt, wine, coals, wood, soap, oil, sugar, iron, hides, tobacco, and stuffs could be sold. It fixed, likewise, the maximum of wages. It was making itself master of all the liberty in commercial transactions, in speculation, and labour, which exist only in a state of liberty. It was placing the hand of the State amongst all sellers, all purchasers, all labourers, and all proprietors of the Republic. Such a law could not but produce the concealment of capital, the cessation of work, the languor of all circulation, and the ruin of all. It is the nature of circumstances which fixes the price of provisions of the first necessity; it is not the law. To order the husbandman to give his corn, and the baker to give his bread, below the price That these provisions cost them, would be to command the one to sow no more, and the other to no longer knead.

The maximum brought forth its fruit by* compressing in every direction the circulation of ready money, labour, and provisions. The people laid the blame of these calamities of nature upon the rich, upon the merchants, and upon the counter-revolutionists.

And the greatest Frenchman of his generation declared that their opinions were all based upon the phantoms of monopoly. Are we not at the present moment doing what the French revolutionists did, and in. a manner productive of the most disastrous results? Already the Premier of the Liberal Government of Victoria is under the necessity of disavowing to the farming community responsibility for haying attempted to fix the prices of articles of prime necessity produced by the agriculturists of this State. The various Victorian politicians are trying to "get from under," and are disclaiming any responsibility for the fixing of prices in a manner resented by the agriculturists of this State. I venture to say that the first opportunity which the agriculturists of New South Wales get to show their marked resentment of what is happening in that State will be productive of a result, the conclusiveness of which no one will deny. Senator Keating has alluded to the fact that a few days ago he saw in Sydney butter being sold in a club. There was a stringency in regard to butter. I saw in the press a statement to the effect that, because the dairymen of New South Wales had requested that an increase in the price of butter be granted, they were called brutally callous.

They were callous because they were asking a remunerative price for their commodity. I am speaking in the presence of representatives of the farming community, and of farming organizations, and in the presence of a man who knows more about farming than I am ever likely to learn; and I say that many farmers and dairymen, because of the fixing of the price of butter, have dried off their cows, and are fattening them for conversion into beef, And so Protean is the whole of our social, industrial, pastoral, and agricultural life, that if we attempt in any respect to regulate and compress in one direction, unexpected results are produced in another. The price of chaff has been arbitrarily fixed. What does the farmer do when he discovers that he cannot obtain for the paddock of lucerne which he happily possesses the price he thinks he ought to get? He turns his stock into the paddock and feeds off the crop. In fixing one price for chaff, has not the result been that only one grade of chaff, of an inferior quality, has been marketed - that there are now no grades in chaff; and that much stuff which is not fit food for any beasts of burden is being sold at prices at which it ought not to be sold? Is there not a complete deterioration of the product put on the market as chaff ? I venture to say there would have been no shortage of sugar in Australia but for the action of the Government of New South Wales in fixing prices. The Colonial Sugar Refining Company, with that energy and initiative which are peculiar to it, would have imported sufficient sugar to meet the needs of the people of the Commonwealth. But the price of sugar was arbitrarily fixed by the State Government; and I saw in New South Wales a few days ago sugar sold at a table in the Commercial Travellers Club. One man complained that his wife could get .sugar only by the pound, and his friend said, " I happen to have a few bags of sugar, and if you choose you may have a bag." That transaction took place, in a Sydney club within my hearing, and it is 'illustrative of the extremities to which the community is reduced because of this improper, ill-considered, and short-sighted attempt to regulate prices.

Senator O'LOGHLIN (SOUTH AUSTRALIA) -Colonel O'Loghlin. - Why not reserve these arguments till we are dealing with a proposal to fix prices?

Senator BAKHAP - What is the objective of these referenda proposals?

Senator Lt Colonel O'Loghlin - There is no proposal in these Bills to fix prices.

Senator BAKHAP - The remarks of the Vice-President of the Executive Council in introducing the Bill consisted solely of an argument in favour of giving the Commonwealth power to fix prices, and a eulogy of the action of the Commonwealth Government in instigating the State Government of Queensland to seize the sugar crop so that the prices of the necessary supplies for the people could be fixed. The honorable senator displays remarkable innocence in denying that the main objective of these proposals is to fix prices.

Senator Lt Colonel O'Loghlin - The proposal is to give certain powers to the people.

Senator BAKHAP - And if the people, as States, exercise the powers they possess in the direction desired by the present National Administration, that National Administration will throw to the winds all its professed desires for an increase of Federal powers because of the necessity of making the Federal Constitution a truly national one. It will condone such action on the part of the States; and will absolutely prevent itself from interfering with the un-Federal action of the State of New South Wales in cornering wheat, and of the State of Queensland in cornering sugar. I have proved beyond all possibility of doubt that one of these proposals contains a special clause prohibiting the National Government from interfering with any Socialistic enterprise undertaken by a State Government. The Government of New South Wales may continue year after year commandeering wheat crop after wheat crop long beyond the duration of the war, and the National Government, by one of these enactments, will effectually prohibit itself from interfering with such unFederal and monopolistic action, notwithstanding that the intention of the original framers of the Constitution was to bring about Inter-State Free Trade.

Senator Guthrie - Is not this legislation likely to limit monopolies?

Senator BAKHAP - The honorable senator must first prove that a monopoly is detrimental. Does the honorable senator denounce the business of the Colonial Sugar Refining Company as a detrimental monopoly ?

Senator Guthrie - I do, indeed.

Senator BAKHAP - If the Colonial Sugar Refining Company had continued to struggle unsuccessfully, as it undoubtedly did in the early period of its history, and had gone into liquidation, would the honorable senator be one to urge the National Government to restore to the company its lost money?

Senator Guthrie - That is quite another matter.

Senator BAKHAP - Of course it is. All the honorable senator desires is to seize the profitable businesses. I do not suppose that the most accomplished historian can at any time tell us the particular cause which led to the decay of strong ancient States and Empires. No historian can lay his finger on the exact cause of the decadence of Spain, or Rome, or of the downfall of Persia, Babylon, or other ancient Empires.

Senator Senior - If you read history you will find that some do tell us.

Senator BAKHAP - Historians allege dozens of different causes. For instance, Lecky alleges that the downfall of the Roman Empire was in many respects clearly traceable to the introduction of Christianity; I do not grant that. It may have been a contributing cause, because of the early Christian doctrine of non-resistance, and of the fact that when the Christians were drafted into the Roman Army they refused to fight, and so on. Although the marked . decay caused by the introduction of these proposals, which will stultify individual initiative, may not be disclosed for centuries, none the less will they most cer'tainly be productive of Australian national decay.

Senator Senior - It has been stated distinctly that large estates led to the destruction of the Roman Empire?

Senator BAKHAP - In this> world you cannot get anything which is absolutely perfect. No doubt there are certain incidents in the operations of commerce which work from time to time, in a minor degree, inimically to the interests of certain people. I think it is Edmund Burke who likens commerce to a broad and noble river bearing great fleets and rich argosies on its bosom, but a river which sometimes overflows, and by its inundations does a certain amount of damage - damage which nevertheless can be easily repaired - and he points out that this river is a great and noble factor in the production of national wealth and in the advancement of national prosperity. I am not going to deny that in ordinary commerce there may be from time to time certain things that are productive of interests which are not altogether favorable to every class of the community. But in the interchange and interplay of commerce, in individual initiative in our present condition of society we get productions which are the very salt of the life of the community. We get commercial operations under way which create wealth, and which cause a certain stimulation of the faculties of every individual in the community who has faculties worth mentioning. Would not every honorable senator present like to see his son a successful business man; would he not like to see his son capable of establishing in Australia an industry which would be productive of, say, a million sterling to him individually, and which would enable him to profitably employ hundreds, nay, thousands, of workmen? I venture to say that any one of us would congratulate himself on having begotten such a son. But if your sons and your grandsons are going to have this prospect before them, if they can ultilize hitherto unutilized Australian resources, make millionaires of themselves in consequence, employ hundreds, perhaps thousands, of men, and yet be open to the reprobation of being exploiters, pirates, and robbers, and open at any time at the hands of a Socialistic State to the sequestration of those enterprises which they have so systematically and so carefully established, what prospect will there be for the nation ?

Senator Watson - How can t]rey make millionaires of themselves?

Senator BAKHAP - Again that fallacious philosophy, that the man who establishes an industry, and is making money, is making it out of somebody. What about, the man who makes two blades of grass grow where only one grew before! Is he not a benefactor?

Senator Senior - How about the man who takes the grass which the other man grew ?

Senator BAKHAP - I suppose in time of drought ?

Senator Senior - No.

Senator BAKHAP - All that I can say is that under the system which the honorable senator wishes to see inaugurated here, there will be very little grass in a general sense for anybody to " collar" - unless it grows in the streets. The Colonial Sugar Refining Company, which is so much spoken of at the present time, and whose operations are said to be so inimical to the best interests of the community-

Senator Watson - And so advantageous to the Liberal party.

Senator BAKHAP - What has it to do with the company except that it fights for it as a legitimate enterprise, and in justification of that initiative and that business capacity which it hopes to see fostered in every class of the community?

Senator Ready - Hear, hear ! And the company gives you some of its sugar, too.

Senator BAKHAP - If the honorable senator uses the term " sugar " in what I might call a metaphorical sense, I tell him that he is absolutely wrong. What do I care for the Colonial Sugar Refining Company except in a general legislative sense ?

Senator Ready - They stand up for your party very well.

Senator BAKHAP - If in 100 square miles of brigalow scrub his son established a great paper manufacturing enterprise which employed hundreds of men, and in the course of a quarter of a century made him a millionaire, how would he like to have his son attacked as a monopolist, a robber, a pirate, a man who was doing something inimical to the rest of the community, and whose enterprise ought to be impaired, undermined, or sequestrated ?

Senator Ready - I would have to stand it if it was true.

Senator BAKHAP - Does the honorable senator think that that would be an incentive to other men to use their brains, their business capacity, and their initiative in the establishment of other industries ?

Senator Ready - The old robber barons of the Rhine used their brains, and people had to pay to go through their toll gates. Had they not a right to do it?

Senator BAKHAP - Does the honorable senator allege that nobody has any right except the right of might, which his party is endeavouring to exercise ? The shareholders of the Colonial Sugar Refining Company cannot by their votes protect themselves. The robber barons of the Rhine robbed openly and by force; but there is an attempt nowadays to institute a new kind of robbery - a robbery at the ballot-box. a declaration by people who do not possess shares in a certain enterprise that it is a monopoly, and none the less can it be destroyed or sequestrated, and none the less can the shareholders in that genuine enterprise who imagined that they were going to be protected by a State be robbed by a State.

The PRESIDENT - Order ! The honorable senator has allowed the discussion on these Bills to degenerate into a discussion on the Colonial Sugar Refining Company. While, no doubt, he is entitled to refer to that company by way of illustration, he is not entitled on this motion to go into a long discursive discussion in regard to the operations of that or any other company.

Senator BAKHAP - I think that this agitation for the passage of these proposals is largely grounded on the antagonism of the Labour party to the Legislative Councils of the States. The States possess the powers to do those things winch the Labour party has in contemplation. Each State has the right to fix prices; nobody denies that it is a sovereign State. But in the States the establishment of that policy is more difficult than it is believed it will be if the National Government secures the power which it is seeking. I wish to refer to this fact because it is believed that the people can, as it were, find a short cut; that by bestowing the power on the National Parliament they will obviate the necessity of agitating to get the Legislative Councils to pass measures which are dear to the hearts of the members of the Labour party in that regard. It is utterly fallacious to imagine that the Legislative Councils are bars to the progress of the people, because it cannot- be ' forgotten that the National Parliament has under its direct control a fifth or a sixth of the territory of the Commonwealth. It has controlled the Northern Territory for some years, where there is no Legislative Council to act as a bar to the realization of Labour objectives, and it has spent hundreds of thousands of pounds there, but without result. The white population of the Northern Territory has--- not increased, while the white population of Flinders Island and King Island, two dependencies of the State of Tasmania, where there is a Legislative Council, is increasing rapidly. In some of the States the people will not permit the arbitrary fixing of prices by their Governments, and I deprecate the attempt to give the National Administration power to do what the people of these States will not permit their own Governments to do. Should the Labour party succeed with these measures, it will in the near, or not very distant, future cause national disaster, because individual initiative will be restricted. It will not be worth the while of any man to attempt to establish a large industry, because, by a chance vote in the National Legislature, any profit-producing enterprise may be declared a monopoly -. 'The Labour party has shown its unwillingness to reform the Constitution in a manner consonant with the Federal spirit, and I protest against these proposals for the improper alteration of that instrument, as well as against the perfidy of this Government in condoning the sugar grab of the Queensland Government, which Senator O'Keefe foreshadowed as the possible result of the successful wheat grab of the Government of New South Wales, which the Commonwealth authorities resisted. I shall oppose to the utmost these proposals to support State Governments in monopolistic and un-Federal action, though I should loyally support any amendment of the Constitution which would establish true Federal principles, and remove all restrictions on commercial intercourse between the States. I think that the people will not swallow these proposals as readily as the members of the Labour party anticipate. Those who are likely to benefit by the un-Federal action of the Queens* land Government, which has been con' doned by the Commonwealth Government, are the sugar-growers of that State, whose industry is protected by a high import duty on sugar.

The PRESIDENT - How does the honorable senator connect the sugar duty with the Bill before the Senate?

Senator Turley - The honorable senator has not discussed the proposal to extend the industrial powers of this Parliament.

Senator BAKHAP - The Minister did not touch on that matter. The Constitution provides that the National Parlia ment may legislate for the settlement of disputes which are Federal in character, that is, of disputes Which are not artificially induced, and which legitimately extend beyond the confines of any one State. Under the exercise of this power, competent Courts have been erected to deal with Federal disputes. But no sound argument can be advanced for giving the Commonwealth Courts the right to interfere in purely State disputes. As to interference by the Commonwealth in the management of the railways of the States, I say that those who pay the piper have the right to call the tune. On what ground could the Federal authority interfere to regulate the hours and rates of wages of State employees?

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