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Tuesday, 30 September 1902

Mr O'MALLEY (Tasmania) - - I am very pleased that the leader of the democratic party has moved to test this question. To me it is peculiar that the representatives of the various States, both in the States Legislatures, and in this Parliament, apparently entertain the opinion that we can do nothing unless we initiate a borrowing policy. I know men in private life who are imbued with a similar idea. I was acquainted with a man in Adelaide who used to accost me regularly each week with a request for the loan of 5s. or 6s., until I began to think that he regarded me as a sort of "grafter" for him. That is precisely the position which the Commonwealth occupies to-day in regard to the various States. The trouble with the latter is that they are suffering from chronic financial delirium tremens. They have had a perpetual financial drunk, and they are suffering from " snakes." The time must come in the history of the Commonwealth when this Parliament must stop the States from continuing their present policy of borrowing. The honorable member for Bourke showed to-night that during the past ten years Victoria has borrowed £10,000,000 - upon which she is annually required to pay by way of interest £350,000 - without having received any corresponding increase of revenue from reproductive public works with which to meet it. What does that mean 1 Yet some people attribute the disappearance of Victorian prosperity to the labour party. I should not utter one word to-night if Victoria were not full of stump orators who declare that tlie financial misfortunes which have' overtaken it are directly traceable to the party with which I have the honour of being identified . I repeat that this State has borrowed £10,000,000 within the last ten years.

Mr Poynton - Has she no assets for that expenditure 1

Mr O'MALLEY - S - She has assets in the shape of disabled engines, ruptured passenger cars, and burst-up goods cars, which are now to be seen lying about the railway yards, and to which Mr. Bent should devote his attention, instead of abusing the labour party. The other day I had a look at this disabled rolling-stock, and I can assure tlie committee that for similar maladministration a private railway company in the United States would have its manager in gaol. So long as we supply extravagant financiers with plenty of- money, they will not economise. There is an old adage which says that "everything comes to him who waits," but I have noticed that the thing for which one is waiting never comes. The time may come - and perhaps it is not far distant- when the Commonwealth Government will have to render financial assistance to some of the States. There may come a period when the small States will not be able to go upon the money market, and raise sufficient funds to cover their indebtedness, and, if so, they will be obliged to ask the Commonwealth to keep them solvent.

Sir Malcolm Mceacharn - They are not likely to do that.

Mr O'MALLEY - I h I have seen it done in America. There certain States have had to approach Congress with a request for assistance. Congress has assisted them, but, at the same time, it has placed a curb upon them so that they could not borrow. The Australian States, however, can go upon the London market, and float loans without any restriction. Every second man one meets in London is there on behalf of ,some of the States Governments. Have the various States reduced the expenditure involved in the maintenance of their AgentsGenerals' staff since the establishment of federation ? Not a bit of it ! Have they abolished the offices of States Governors, and all the tin-pot paraphernalia associated with them ? Have they talked about reducing the emoluments of their Judges, who receive salaries of which ancient emperors and kings never dreamed ? Not a bit of it ! Yet the Treasurer and his eloquent colleague, the Acting Prime Minister, declare that we must not interfere with the States. We want to save them. I represent the smallest State in the union, and the one which perhaps has sacrificed most. But I wish to teach that State, as the State in Western America, where I lived, was taught, that she must study economy - not tomfoolery economy - and that she must throttle the extravagant, spurless roosters who are bringing her down to disgrace. Let us look at another aspect of this question. Supposing that we allow these State gentlemen to continue their policy of "borrow, boom, and burst," without interference, what will' be the result? Unquestionably, they will borrow, boom, and burst. Yet we are told that we must not interfere with the revenue of the States- that we must go upon the money market and borrow as much as we can, whilst the States continue to borrow as much as they can. The point which seems to escape attention is that there is no new population coming to our shores. The real trouble is that the various States, when federating, forgot that the same people would have to pay the taxes. As a result, every State, just prior to the inauguration of the Commonwealth, started to pile up its military expenditure. In Tasmania two post-offices were established, which were absolutely unnecessary, because her people were under the impression that the expenditure connected with them would fall upon the Commonwealth. Similarly, ever\T second man one met was looking to the Commonwealth for an increase in his salary. It was thought that we were to have a Rothschild, or some of the American millionaires, at our back, instead of the people of Australia. But the same white-faced Caucasians have to pay the taxes, and they are , the people of whom I am thinking. We are determined to stop this loan business - small as it is - to-night. Three-quarters of the revenue derived from Customs has to be returned to the States, but one-quarter of it must be retained by the Commonwealth to enable us to carry out reproductive public works. The "boodler" must go. I will admit that the money which has been borrowed in this country has enriched a lot of gentlemen. By a system of exploiting the earnings of the workers they have grabbed it, and now they object to paying their fair share of the taxes. Every year they want the same struggling man to come up to the scratch and pay the taxation for them. How long would it take the Victorian Government to wipe out the State deficit if they would come down with a legitimate system of taxation ? But we shall never obtain anything from the frozen-hearted, gilded, and spurless roosters of to-day until we force them to give it. As, however, I can see that there is no prospect of the Government proposal being carried, I will not debate the matter further.

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