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Friday, 17 August 1906

The PRESIDENT - I ask the honorable senator not to deal with that matter, which is not before the Senate.

Senator FINDLEY - When before the Tariff Commission Mr. McKay's attention was drawn by Mr. F'owler to the trouble that had occurred at Ballarat. He said in the course of his examination, when referring to the determination of the Ironmasters' Board -

The condition they made, and of which we complained, was there should be one improver to every two journeymen. We had four improvers to one journeyman, and to carry out their condition we should have had to sack seven out of eight of very deserving young men, who were helping to develop our business.

So that his consideration was not for the men who ought to have been employed doing the work that youths were doing at youths' wages, but for what is extremely profitable to himself- The question is often asked " What shall we do with our boys "? If all employers were like Mr. McKay, we should not have much difficulty in solving that problem, but a more serious problem would arise : ' ' What shall we do with our men"? Senator Higgs asked Mr. McKay his opinion about Wages Boards, and the minimum wage. He made matters sufficiently ambiguous to satisfy nobody on the Commission. He would not commit him. self. As a matter of fact, to speak correctly, he fenced a direct question that ought to have received a direct answer. Then he complained that the International Harvester Trust with its immense capital was going to ruin the business with which he was connected. Mr. McKay's own connexion with that combination is worthy of recital. Some .one has said that there is charm in a twice-told tale. It may be said that what I am going to state has been said before, but it cannot be too much emphasized. Mr. McKay, together with other manufacturers, in 1903, entered into an agreement with the International Harvester Company, and the MasseyHarris Company, that in no part of Victoria, and in no part of the Commonwealth, should machines be sold for less than £81 spot cash. That agreement was binding during 1903-4. While it continued, all was sunshine for the local manufacturers, and probably also for the importing firms. At that time, however, the International Harvester Company had not a great number of machines in Australia. It went into business to make money out of it, just as the local makers did. After the expiration of twelve months, the agreement was renewed. But during its currency, Mr. McKay, and some of the other local manufacturers commenced knocking loudly at the legislative door.

Senator Mulcahy - They were asked to " Come in," were they not?

Senator FINDLEY - They complained about what they called the unfair competition of the importers at a time when they were parties to an agreement with the importers ; and they asked for a fixed duty of ^25 on each harvester imported. They received a sympathetic reply. ' The International people then said in effect, " These manufacturers have broken away from the agreement they have made with us." It appears that the local manufacturers promised that if they could get the measure of protection that they asked for, they would, in the first year, reduce the price of their harvesters by £5, and in the second year, would make a reduction of £10. Immediately that decision was made known, the International Harvester Company decided' to reduce the price of its machines. Senator Trenwith last night endeavoured to show that the price at which the Internationa^ Company was now selling was below that at which harvesters could be manufactured and sold in Australia. Strange to say, however, I am credibly informed that one of the local manufacturers, a party to the agreement, is to-day selling a machine at £68 5s., which, while the agreement was in operation, he was selling for £81 The International Company is selling »t ,£70.

It is said that its machines at one time came in invoiced at £26. I have been searching, and cannot verify that statement. It is true, however, that -the International Company imported harvesters invoiced at £31 5s., while the Massey-Harris Company imported them at ^38. But at that time, the machines of the International Company were of a lighter make and of a different type from those which the Massey-Harris Company were importing. After the Minister decided to increase the valuation of the International Company's machines to the invoice price of the Massey-Harris machines, £38, trie International people commenced to make a heavier machine. I am informed, and I think correctly, that those machines can be made for between .£30 and £35. If there is any truth in the contention that a huge company with a large capital can afford to manufacture cheaper than a small man, it stands to reason that the International Company can make harvesters cheaper than the local manufacturers.

Senator Fraser - I doubt whether they can import them as cheaply as the local men can manufacture.

Senator FINDLEY - On what does the honorable senator base his doubts?

Senator Fraser - Freights and charges have to be taken into consideration.

Senator FINDLEY - If packing charges and freight are taken into consideration, the honorable senator's view is correct, but I cannot believe that a man in a small way, as Mr. McKay is in comparison with the International Company, can manufacture as cheaply as they can.

Senator Millen - The honorable senator means the cost of the factory?

Senator FINDLEY - Yes. Senator Trenwith laid very great stress on what is known as the ' ' apple tree ' ' circular ; but that circular was issued immediately after the deputation of local manufacturers, and it will be seen that it is nm, admitted that the cost of manufacture is ,£38. The first three items quoted by Senator Trenwith are admitted; and those are £9 is. 5d. for casing, packing, ocean freight, and exchange; £3 2s. id. for wharfage, packing inward, cartage, &c. ; and £5 4»- 7d- as duty prior to the present increase. It is not admitted, however, that it costs /I21 17s. 5d. for cartage, delivery, travellers' salaries and expenses, and so forth, or 27 per cent, of the retail price. Personally, I do not think that it could cost £21 to dispose of a machine after it had 'been landed. However, I do not desire to pursue a line of reasoning which might be construed into a plea for the importing firm.

Senator Pearce - Is it not a fact that other local manufacturers in Victoria are subject to the Wages Board provisions?

Senator FINDLEY - Yes. When Mr. McKay moved from Ballarat to Braybrook he got within a mile of other manufacturers in the same business, who were bound by an Act of Parliament to observe the conditions to which I have alluded. Braybrook is about ten miles from Melbourne. At places like Spotswood, Newport, and Footscray, although these are, so to speak, within a stone's throw of Braybrook, manufacturers have to observe conditions from which Mr. McKay is exempt. As a matter of fact, I have very little consideration for or approval of the importation of goods which can be manufactured in Australia, and I desire that to be clearly understood. But, as a protectionist who wishes to see the establishment of industries, I "Have no desire for the perpetuation of an evil introduced by Mr. McKay in connexion with an important industry. If an industry cannot extend reasonable conditions to those it employs, it ought not to survive.

Senator Fraser - The industry ought to be subject to the State law.

Senator O'Keefe - I - Is it not the fault of the State Parliament that Mr. McKay has not been brought under the operation of the State Act-?

Senator Millen - It is not the fault of the State Parliament that Mr. McKaydodged the law.

Senator O'Keefe - S - Surely the State Parliament is powerful enough to follow Mr. McKay, or anybody else.

Senator FINDLEY - The Chief Secretary and his departmental officers, while no doubt desirous that Mr. McKay's works should be carried on under the conditions imposed by the. Factories' Act and the Wages Boards, were probably influenced to a considerable extent by the petition of the men to be exempt. But there is not the shadow of doubt in the minds of those capable of judging that, to use a colloquialism, the petition was hawked round. I cannot think for a moment that any body of workmen, of their own volition, without the exercise of influence in a certain way,' would sign a petition to be exempt from conditions beneficial to themselves. Senator Play- ford, in introducing the Bill, said that we were told that the United States is cursed with trusts because it is a protectionist country. But I assert that fiscalism has little, if anything, to do with the creation of trusts and combinations, which are the inevitable result of the capitalisticcompetitive system. The old theory that competition is the life of trade has long since been exploded. If competition is the life of trade, it is the death of businesses. Trusts are an economic development ; they exist in every country throughout the world. There are some trusts that are perfect typhoons in the sea of competition. They absorb everything that comes within their influence; and as the result of typhoonic trusts, human wrecks can be seen in almost every part of the world. The capitalisticcompetitive system is just about a century old, but I venture to say that it is doomed not to see another hundredth birthday. Condemn these trusts as we. may, we must recognise them as an economic development, which may, after all, prove only a blessing in disguise. They demonstrate as clearly as the noonday sun that the position taken up by the advocates of collectivism is indisputable. By complete organization, and with the aid of immense capital, trusts are able to introduce the latest and most scientific methods of production, and to effect immense economies. With these concrete examples before us in the form of privatelyowned trusts, we can readily see what a manifold advantage it would be if industries of the kind were under the control of the State - if they were not conducted on a system which creates a few millionaires on the one hand and countless mendicants on the other. I hold that all privately-owned trusts are inimical to a nation's progress. I hold further that, notwithstanding what anti- Socialists may say, competition has succeeded only by what I call a process of commercial cannibalism - that is, the eating up of small businesses by large ones, and large businesses by still larger. Let us view the position of working men in America in regard to these trusts. When there is a combination of firms, the workmen or workwomen have only one employer ; and that is the case in many lines of industry in America.

Senator Fraser - But in America a man may be a worker to-day and an employer to-morrow.

Senator FINDLEY - That is not at all possible in this enlightened day - it is abso lutely impossible in America, and well-nigh impossible in Great Britain. There were periods, prior to the expansion of the competitive system, when a man with small capital, and endowed with energy and intelligence, could start on his own account, and probably become very successful in business. But in the United States of America to-day what hope has a small man of starting successfully in any line of business in opposition to the huge trusts ?

Senator Fraser - Ninety per cent, of the successful men in Australia are selfmade men.

Senator FINDLEY - I neverknew a self-made man in any country on earth. No man can, by his individual efforts or enterprise, become wealthy, but men may, and frequently do, become wealthy by the united efforts and industry of those who work on their behalf. Very often those who pass as self-made men owe little or nothing to their own ability, their wealth having been won for them by subordinates, who, in some cases, have received very small remuneration for their services. What is the position of the working men under some of the combines in America ? We often hear people talk about the tyranny of trades unionism, when some trades unionists conscientiously refuse to work with non-unionists, who have done nothing to advance the. interests of the working classes, or of human kind. That is said to be tyranny of the worst description; but it is nothing of the kind. On the other hand, what is the tyranny exercised over the workers employed by the huge combines of the United States ? According to the report of Mr. Tregear -

In regard to the black-list, it is asserted that it is often vindictively and almost always heartlessly used. Under the oid regime it was possible, on discharge, to find another employer, but under combination, the employing body is a solid block of resistance, and in case of a worker offending his boss and being discharged, his name is blacklisted in every department of the vast combination. If he does not change his name and disguise himself, there is no remedy but leaving that part of the country for ever. Governor Thomas, of Colorado, speaking on the subject of veto for repeal of an anti-boycott clause in a Bill, said- " The most serious fact urged on behalfof this Bill is that some of the great companies in the State disregard and violate the black-list section with impunity. . . . The strong syndicate, entrenched in power and authority, overrides prohibition and penalties, snaps its fingers in the faces of the people, and sets at naught the limitations of Statutes and Constitution."

What does the Sherman Act - and I understand the Bill is a twin brother of that Act - do for the unfortunate workmen of the United States, who are the victims of such tyranny as this? I fake the following also from Mr. Tregear's report : -

According to Mr. Lawson's survey of " American Industrial Problems," newly published by the Messrs. Blackwood, American workmen are compelled by their employers to obey certain rules of life. They must be teetotallers; they must live in villages which the employer establishes for them ; they are subject to a continued occult surveillance.

Confidential reports are made periodically to the management on every employed The careless maxim of some British masters, that their men can do what they like with their own time, is never heard in the United States.

In the workshops private detectives are introduced to find out what the men are saying and doing : - " The great Pinkerton has a detective service for this express purpose. One of his men may be hired as a fitter or mechanic, and he may be in the shop for months without exciting the least suspicion of his character. Every night he will send in a report of all he has seen or heard during the day."

Senator McGregor - And a great deal that he has not heard.

Senator FINDLEY - Probably. I do not think that the Bill will in any way minimize the evils of trusts, so far as the working classes are concerned. I have said that all privately-owned combines and trusts are inimical to a nation's progress; because they, so to speak, have the community in the hollow of their hand. Some of these trusts in America silence newspaper criticism. I can quote a case in point, and I think I shall be able to show, after quoting it, that it has some local application. There is .in America a patent medicine trust with a capital of £50,000,000. The retail price of the curealls sold by this patent medicine trust in the United States in one year is estimated, according to a writer in The World's Work and Play, at £20,000,000, of which sum £8,000.000 is spent in newspaper advertising, with the object of silencing any agitation which may be got up to condemn these quack medicines. I have here the issue of The World's Work and Play, for June, 1906, in which I find the statement made that the President of the Patent Medicine Association, in addressing the members of that Association quite recently, said - " The twenty thousand newspapers of the United States make more money from advertising the proprietary medicines than do the pro prietors of the medicines themselves. Of their receipts, one-third to one-half goes for advertising."

The writer of the article from which this quotation is taken, says -

But in return for this the patent medicine men have cunningly succeeded in obtaining something more than the mere advertising space in the papers ; they have brought about a conspiracy of silence ; seduced the newspapers into captivity. Religious papers seem to be the most accommodating.

He goes on to give an absolute case, and he says -

In March, 1905, there was a debate in the Lower - House of the Massachusetts Legislature on a Bill providing that every bottle of patent medicine sold in the State should bear a label stating the contents of the bottle.

When the Trade Marks Bill was before the Senate, I endeavoured to secure the insertion of a provision requiring that all these nostrums should be properly labelled, but some one said that it would ruin the medicine business, and that it was an interference with the liberty of the subject. If the formulae of these cure-alls - these cures for every disease, from mumps to consumption - were made known, instead of paying 5s. a bottle for, them, people would find that they could make them for 5d. a bottle, and perhaps they would also find that it would be better for their health if they never used them at all. The writer of the article referred to continues -

Some twenty speakers engaged in it, and more was told concerning patent medicines that afternoon than often comes to light in a single day. But the speakers searched in vain in next day's newspapers for their speeches; the legislative reporters failed to find their work in print.

This has some local application.

Senator de Largie - Surely not?

Senator FINDLEY - I am referring now only to the advertising of patent medicines. There is a certain patent medicine called "Peruna." Honorable senators will have noticed in various newspapers published throughout the Commonwealth that it is very extensively advertised, in quarterpage and half-page advertisements. It ishighly recommended by an ex-senator of the United States of America, and it appeals, to everybody with any kind of complaint. Thev will sell you a bottle for 5s., and if" that does not cure you, they advise you to> buy six bottles for 25s., and you will beall right. This Peruna contains as much alcohol as does whisky, brandy, or rum. It contains from 40 to 50 per cent, of alcohol, as has been proved by analysismade by the Customs Department here.

Senator Guthrie - The proprietors were fined in Brisbane.

Senator FINDLEY - I was going to deal with that. It is a remarkable thing that, although a certain firm was fined in Brisbane for selling this " disguised booze," only one newspaper in Australia published the detailsof the case. That is not my statement, but a statement appearing in the Journal of Pharmacy, and this is attributed to the fact that the newspapers throughout Australia received large sums of money for advertisements of this patent medicine.

Senator McGregor - We shall see whether they will publish what the honorable senator is saying to-day.

Senator FINDLEY - I do not care whether they do or not. I have the greatest respect Tor and confidence in the men who do the work of journalism in the Commonwealth, but I am aware that there are literary surgeons in the editorial sanctums who use the knife freely. I worked as a compositor for many years, and if there was one thing more than another that hurried on my desire for democracy and fair play, it was my knowledge of the unfairness of the proprietors of newspapers that howled for democracy and fair play but did not practise what they preached. The article to which I have been referring says with respect to Peruna: -

Any one wishing to make Peruna for home consumption may do so by mixing half-a-pint of cologne spirits, ninety proof, with a pint and a half of water, adding thereto a little cubebs for flavour, and a little burnt sugar for colour. It will cost in small quantities perhaps 3½d. or 4d. a quart. Manufactured in bulk its cost, including bottle and wrapper, is about 4½d. . . . "A compound of seven drugs with cologne spirits " is the authenticated formulae of Peruna, but the total of the seven drugs is less than one-half of one per cent, of the product, and cologne spirits is the commercial term for alcohol. What makes it a curse to the community is the fact that the minimum dose first ceases to satisfy, then the moderate dose, and finally the maximum dose; and the unsuspecting patron who began it as a medicine goes on to use it as a beverage, and finally to be enslaved by it as a habit. The American Government forbids the sale of this " medicine " to Indians, because, says the Treasury department, " it leads to intoxication." A druggist in a southern "nolicence " town remarks upon the large sale of Peruna there.

I have seen persons thoroughly intoxicated from taking Peruna. The common remark in this place when a drunken party is particularly obstreperous is that he is on a " Peruna drunk." It is a notorious fact that a great many do use Peruna to get the alcoholic effects, and they do get it good and strong.

That should be interesting to prohibitionists.

Senator Pearce - It might have been useful in the canteen debate.

Senator FINDLEY - I thought I would keep it for the Anti-Trust Bill. I had it up my sleeve.

Senator Millen - The sales of Peruna will go up after this.

Senator FINDLEY - Yes. I am going to tell honorable senators how thev go for it in Maine, which is a prohibition State. There are evidently a lot of " dead marines" to be found there. The article continues -

So well recognised is this use of the nostrum that a number of the southern newspapers advertise a cure for the Peruna habit.

So that the effects of this panacea for every malady under the sun. and every evil to which flesh is heir, have afterwards to be cured by another cure-all.

It may be asked, why should any one who wants to get drunk drink a patent medicine - . or, as the picturesque American writer puts it, " disguised booze " instead of, say, whisky ? One reason is that in many places the " medicine " can be obtained and the liquor cannot. For instance, prohibitionists at home will have to confess with regret that some al least of the credit which has been awarded to Maine as a prohibition State must be withdrawn when the significance of the big business which this State does in patent medicines is realized.

I shall not quote a special case which is given, but it was that of a clergyman who was very seriously ill. He called in a physician who, after examining him, said, " You are suffering from alcohol poisoning." He said, "Nonsense; I have never taken liquor in my life." The physician said, " You have been poisoned bv drinking alcohol. What patent medicine do vou take"? The reply was, "I take Peruna," and the physician said, " You have got the Peruna habit vervbad. Give it up' or you will only go from bad toworse."

Senator O'KEEFE (TASMANIA) - - What has the Peruna business to do with the Bill?

Senator FINDLEY - I am referring to some of the operations of the patent medicine trust of the United States who are introducing this nostrum to Australia to the serious injury of the health of the people. It is recommended as a cure-all for 'adults, and also strongly recommended as a cure-all for infantile complaints. An infant is supposed to take a spoonful of Peruna before each meal, and if that is continued for a week or two there will probably be very little of the infant left. I know that there is extreme anxiety that the debate should close, and I desire to say in conclusion that this measure has been enthusiastically approved by a number of Government supporters, whilst it has been severely condemned by other honorable senators. Speaking personally, it is not a Bill over which I can enthuse. T will admit that it has been framed bv a skilful mind. Perhaps it is the very embodiment of the wisdom of the wise, but I cannot bring myself' to believe that it will realize the expectations formed of it by the framers. I _am satisfied that no system other than 'that of collectivism will be a cure-all for trusts. The anti-socialistic - individualistic - capitalistic system has had a long and varied trial. It is going to decay. I hope the time will soon arrive when there will be substituted for it some more scientific system. Like Senator Pearce, I am extremely desirous- to hasten that -time, but I am prepared to give this Bill a trial, and if it realizes the anticipations of its framers, no one will be more surprised than those who think with me ii» regard to the present system of society.

Debate (on motion by Senator de Largie) adjourned.

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