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Stanley Bruce's great
industrial relations blunder
By J.T. Lang
Introduction
Fighting the Liberals' attacks on unions
By Bob Gould
The Howard government and its conservative backers are preparing with
considerable fanfare for an assault on the trade unions through
so-called reform of the industrial relations system after Howard gets
control of the Senate on June 31.
This raises the issue of how the reactionary proposals of the Liberals
can be defeated, as the labour movement faces these attacks in a rather
defensive situation.
People who think there will be a massive groundswell of immediate
industrial rebellion against these proposals are deluding themselves.
The labour movement at the moment is rather battered and dispirited.
The traditional socialist slogans of mobilisation are still necessary
and appropriate, but it's extremely important to conduct a rapid
educational program in the labour movement about the dangers of the
conservative industrial proposals and about historical precedents.
A campaign for a militant industrial response has to be combined with
exploring all the legal possibilities for defeating the Liberal
offensive. Rhetoric about industrial mobilisation, on its own, won't
get very far.
It's also necessary to construct the broadest united front, including
the bureaucracies in the labour movement, whose interests are
threatened to some extent, and state Labor governments, whose
traditional prerogatives are threatened.
The Liberals have a tall order before them, legally. They're talking
about using aspects of corporations law to grab control of state
industrial systems, forcing most industrial matters into the federal
sphere and then abolishing most of the functions of the state systems.
Legally, that is a high-risk strategy. Even the current
conservative-dominated High Court is likely to reject such proposals if
they're strenuously opposed by the states.
A big danger in this situation is left talk by sections of the union
bureaucracy and state Labor governments about handing over the state
systems to the federal government on traditional Labor centralist
grounds.
Such moves should be strenuously resisted. The striking thing about the
Liberals' proposals is that they are an extraordinary rerun of the
policies of the Bruce-Page conservative government in 1926 and 1928-29,
which were defeated firstly in a referendum in 1926 and finally by the
electoral defeat of the Bruce-Page government in 1929.
In some ways the social circumstances of the late 1920s were similar to
now. The labour movement was in a relatively defensive situation and
the economy was in a relative boom.
The political situation in the labour movement was quite similar too,
with Matt Charlton, the federal parliamentary leader, supporting the
transfer of industrial powers to the federal sphere, rather like Gough
Whitlam did more recently.
The major difference is that in the late 1920s there was quite a bit of
conflict on the conservative side about the proposals, with the
turbulent figure of Billy Hughes opposing Bruce every inch of the way.
There doesn't seem to be the same scale of dissent on the conservative
side in current conditions.
The most recent example of successful industrial resistance to
conservative attack is the struggle of the Maritime Union a few years
ago. That was a classic agitation combining industrial militancy,
community mobilisation and the intelligent exploitation of every legal
mechanism, which largely contributed to achieving the desired outcome:
the preservation of the MUA.
In Jack Lang's useful memoir, The Great Bust, which was largely
ghost-written by Norm Macauley, there is a useful account of the
Bruce-Page government's failed attempt to do what the Howard government
is hoping to do. The two relevant chapters are available below to
assist the beginnings of a discussion, which will have to take place
pretty fast if the next few months are to be used to prepare for
mobilisation.
Bruce's topsy-turvy referendum
From The
Great Bust:
The Depression of the Thirties, by J.T. Lang
Imagine a
referendum
in which every political leader in the Commonwealth was rejected in
his own sphere of influence. That was what happened in Australia on
September 4th, 1926. No one escaped the axe. It was a referendum to
hand over industrial powers to the Commonwealth, and to provide
limited powers over trusts and combines. Prime Minister Bruce
sponsored the proposal. He was not only defeated throughout Australia
but in his own state of Victoria as well. The federal leader of the
Labor opposition, Matt Charlton, supported Bruce. He also had his
advice rejected throughout the Commonwealth and couldn't even carry
his own electorate of Hunter.
As Premier of
New
South Wales I advocated a no vote. But this state voted yes. T.R.
Bavin, who was leader of the Nationalist opposition, also advocated a
no vote, but his state electorate of Gordon gave an emphatic yes
vote. Mick Bruxner, Dave Drummond, Frank Chaffey and other prominent
members of the state opposition, were against increased federal
powers and met the same fate.
E.G. Theodore
was
premier of Queensland, and also was on the no side, only to have his
state vote yes. Scullin, Latham, W.M. Hughes, Frank Brennan and Dr
Maloney were all on the losing side.
If anyone
wants to
study the referendum device to prove just how unpredictable public
opinion can be, and how difficult it is to carry a referendum, this
vote provides a classic study. I have opposed every referendum since
the first conscription referendum. Although the Labor platform
provided for unification, I was always a federalist. I believed that
the sovereign states had very real functions. The Commonwealth was
always trying to filch them.
The state of
New
South Wales was always in the vanguard of social reform. We were many
steps ahead of the other states. Many of the referenda were inspired
by the hope of taking over control of our affairs, in order to
deprive the people of this state of hard-won gains. That was
precisely why Bruce introduced his referendum proposals in June 1926.
My government
had
passed a 44-Hour Week Act, which provided for a working day of eight
hours, and a 51/2 day week. Instead of leaving the question to the
courts, we had introduced it by legislation. The Tories were hostile.
They said we were ruining the state. Industries would transfer to
other states. We also introduced compulsory workers' compensation, a
new factories act, the widows' pension and had motherhood endowment
ready for Parliament. The Tories were in a panic.
Bruce had just
swept
the country in his law-and-order election and believed that he had a
mandate to deal with the trade unions. The Crimes Act had been the
first step only. He wanted to introduce compulsory ballots for trade
unions. He also wanted power to bolster up the Crimes Act. There were
still grave doubts as to whether it was constitutional.
In the 44-Hour
Act,
we inserted a provision that it applied to all workers within the
state, whether they worked under federal or state awards. The
employers, through the Clyde Engineering Company, Lever Bros and
Metters, took the case to the High Court. It is known in the law
books as the Cowburn and Amalgamated Engineers' Union case. By four
to two the High Court ruled that federal awards prevailed over all
state awards, as did federal laws over state where the Commonwealth
has jurisdiction.
Chief Justice
Sir
Adrian Knox, Sir Isaac Isaacs, and Justices Rich and Starke upheld
the federal power. Messrs Justices Higgins and Powers, both well
versed in industrial law, had the opposite viewpoint.
After studying
the
judgment, the Bruce-Page Cabinet decided they could stymie the
44-hour week right away if they could obtain full power over
industrial matters for the Commonwealth. Only New South Wales and
Queensland had the 44-hour week.
They appointed
a
Commonwealth Arbitration Court of three judges – Chief Justice
Lukin, and Justices Dethridge and Beeby. They were given appointments
for life at £2500 a year. The next move was to get the question
of hours and wages transferred to their court.
Bruce and his
Attorney-General, J.G. Latham, decided that the time was opportune
for a referendum to increase Commonwealth powers. One of their
problems was that a Nationalist Party conference in 1923 had voted in
favor of limiting Commonwealth powers and transferring them back to
the states. But that didn't worry Bruce. He had just obtained a fresh
mandate. Most of the states had returned Labor governments. In a
speech to a select gathering at the Hotel Australia, presided over by
Sir Owen Cox, Bruce, shortly after he had become Prime Minister, had
suggested what was really needed in this country was a "dictatorship
of six of the best brains of the land".
Bruce knew
that the
Federal Labor Party had always favored unification. Fisher had put a
referendum to the people in 1911 and 1913, which had suggested
alterations to the constitution giving the federal government
absolute power over all industrial problems, trusts and monopolies
and other items in the Labor platform. They had been rejected on both
occasions, with New South Wales leading the opposition. Hughes tried
again in 1919 with proposals covering trade and commerce, as well as
arbitration, together with power to nationalise monopolies. Again the
Australian people had turned their thumbs down and nowhere more
emphatically than in this state.
Bruce's trump
card
was to invite Charlton and the federal Labor Party to confer with him
on proposals which they could jointly submit to the people. The
Federal Caucus referred the suggestion to the state branches of the
ALP. Three states were in favor of collaboration while three were
against. Again New South Wales opposed the suggestion. Charlton then
decided that he would go ahead.
Bruce's chief
proposition was that the constitution should be altered in such a way
as to hand over all power dealing with the regulation of the terms
and conditions of employment, and the rights and duties of employers
and employees in all industrial matters to authorities to be
established by the Commonwealth. That meant giving absolute power to
the Commonwealth Arbitration Court.
There was a
second
clause, intended as a sop to the Federal Labor Party, to grant
control over trusts and combinations operating "in restraint of
trade". Charlton and his party didn't realise that the clause
could be used against trade unions as well as against powerful
trusts. Then as a separate question there was a proposal to give the
Commonwealth power "to protect the interests of the public in
case of actual or probable interruption of an essential service".
The federal
caucus,
after many comings and goings between the two parties, finally agreed
to support Bruce in an appeal to the people. In Sydney, I immediately
denounced it as an attempt to deprive the people of the 44-hour week.
I pointed out that the states would jettison all rights to enact
factory laws. Conciliation and arbitration courts would no longer be
state affairs. Workers' compensation, early closing, motherhood
endowment, would be solely federal matters. The Commonwealth could
kill the state laws. "The whole social and industrial life of
the Australian people will be at the mercy of three legal gentlemen,
who will be superior to all laws, federal or dtate. Mr Bruce's
proposals are fraught with tremendous danger to the peace, order and
good government of the Commonwealth," I told the Labor Party.
The ALP executive backed my stand.
In
Melbourne, Bruce and Charlton collaborated to the limit. The only
criticism came from within the government parties. A West Australian
member of the Country Party, Mr Gregory, called it an unholy
alliance. WA Watt, a former treasurer and deputy prime minister, said
that it would split all parties. He had grave doubts. He described
the rival groups as two well-bred dogs watching the bone held in the
Prime Minister's hand. He was suspicious of giving judges too much
power. "Even if they were angels from Heaven, I should hesitate
to repose in these three judges of the Arbitration Court the enormous
powers contained in this measure," said Watt.
Hughes was
also
against giving the power to the judges. He said it should remain with
Parliament. That was the original proposal of 1911. But it didn't
satisfy Bruce. He wanted Lukin, Dethridge and Beeby to have the
power, and not Parliament. However, Hughes finally agreed that half a
loaf was better than none and agreed to support the Bill. Mr Rodgers,
a former Nationalist minister of trade and customs from Victoria,
openly attacked the Bill. He said he preferred to leave industrial
matters to the wages boards as they had then in Victoria. He said the
Labor Party could appoint its own judges to bring in a 30-hour week
and £10 a week wage.
The Bill to
refer
the proposal to a referendum was carried by 56 votes to two – the
dissenters being Messrs Gregory and Rodgers. Watt and Hughes
supported the Bill. A number of Labor members, including Frank
Anstey, Percy Coleman and Billy Mahony, didn't vote.
The fight then
moved
into the electorates. A council of federal unions was formed in
Melbourne to urge a yes vote. The committee had unlimited money to
spend and millions of pamphlets were distributed with arguments by
Matt Charlton and Scullin in favor of the Bruce proposals.
The
counter came when Albert Willis called an All-Australian Congress of
Trades Unions in Sydney and invited Charlton to attend. It was the
first meeting of the ACTU.
Charlton put
up a passionate defence of his stand. He was told that
he
had been guilty of an act of treachery against the working class. The
miners were particularly bitter, and they controlled his selection.
Charlton said that the proposal was the same as Labor supported in
1911 and said that Bruce had seen the light. "For God's sake
don't let your opinions bring disruption to the Labor movement,"
he pleaded. He said every member of the Labor Party was free to vote
as he liked.
By 144 votes
to 10,
Charlton was rejected by the congress. It was a humiliating defeat.
In Melbourne, Maurice Blackburn was one of the few to come out in
opposition. On the other side of the political fence there was
growing confusion. The Nationalists in this state wanted it. They
wanted to kill the 44-hour week. The manufacturers, retailers and
wholesale houses all backed Bruce with cash.
But Thomas R.
Bavin,
state leader of the Nationalist Party, was against it. "You will
never get industrial peace through a Court." He pointed out that
they would be giving the power to the next federal Labor government.
He had the foresight to see what such powers could lead to in the
future. "The federal proposals would vest the whole power over
the fortunes of Australia in a body of professional politicians
sitting at Canberra who would be far removed from contact with the
electors," he told the Constitutional Association. "An
enormous administrative machinery, such as had never been attempted
in the world before, would be created to administer the affairs, of a
large continent."
Bavin and I
had
disagreed on practically every issue in politics. We were bitter
opponents. But for once we thought alike. The Nationalists supporting
no formed a Federal Union with R. Clive Teece, KC. as its president.
Bavin led the campaign in NSW for the Nationalist no side, while I
led the Labor side.
In Victoria,
Bruce
had more trouble with his own backers. The Victorian manufacturers
were afraid it would bring the 44-hour to that state. Some of the
Nationalist papers openly opposed Bruce for the first time. Sir
Arthur Robinson, a powerful industrial figure, led the no campaign
for the federal union in that state. He said he was opposed to giving
more power to politicians who always wanted more power. "These
politicians will be meeting miles from anywhere surrounded by
thousands of public servants and they will get a distorted reflex of
public opinion," he said prophetically. "Politicians cannot
get a reflex of public opinion when they are out of touch with the
public. The atmosphere of Canberra will be that of officialdom, the
atmosphere of the tax gatherer, and not of the taxpayer."
Sir Walter
Massy
Greene agreed with that viewpoint. "It is as easy to find
icicles at the equator as to get the federal Parliament to agree to
limit Commonwealth powers," he said. Among those to join the
Federal Union campaign with the big money battalions in Victoria was
a well-known barrister with political aspirations, R.G. Menzies. He
was also on the no side. It was all very, very confusing to the
average elector.
I
campaigned throughout the state denouncing any plan to give power to
a legal oligarchy. There were huge audiences everywhere. In Goulburn
there were two attractions: Toti Dal Monte, the opera singer, and our
meeting. We attracted the bigger house, but Toti got the money. In
Bathurst, the mover of the motion congratulating me was a former
engine-driver who been victimised in the 1917 strike, J.B. Chifley.
He pledged his loyalty and was supported by Gus Kelly. Chifley still
had to seek political honors. On the Sunday there was a vast meeting
of 75,000 in the Domain, all with hands upraised for a no vote. Some
of the federal Labor politicians had switched sides, leaving Charlton
isolated. Our final advertisement was directed against control of
Australia by the "Three Men." They were judges Lukin,
Dethridge and Beeby, who would become economic dictators of Australia
as visualised by Bruce.
Bruce himself
left
Australia two days before the poll to go to an Imperial conference.
We appointed state government scrutineers at every polling place.
Before leaving, Bruce ordered the PMG to grant him an additional
broadcast, although it was against the previous order of the PMG that
sides should have equal time.
Then the
numbers
went up. We were all beaten. There were two proposals. Both were
defeated by some 400,000 votes in all. The majority against them for
no in Victoria was just on 250,000, in South Australia 120,000, West
Australia 70,000 and Tasmania 10,000. There was a yes majority of
33,000 in New South Wales, and 16,000 in Queensland, on the principal
proposal. The majorities for no were smaller on the question to give
the Commonwealth powers to deal with industrial emergencies.
The actual
figures
in NSW on the principal question were:
The
chief lesson was that even though Parliament was practically
unanimous, the people still prefer to do their own thinking. It was
certainly a topsy-turvy referendum.
Bruce's
blunder
When a
government
realises that it is losing its grip on the political situation it
invariably commences to go from one blunder to another. It panics. It
loses its perspective. It listens to too many advisers. Then in a
moment of despair it is likely to take a desperate risk.
That was what
happened to the Bruce-Page government. The 1928 election had rattled
it badly. It was being sniped from its own cross benches. Its most
effective critics were those on its side of the House. W.M. Hughes,
Mann, George Maxwell, K.C., P.G. Stewart, all contributed to the
disintegration process.
Then S.M.
Bruce
played right into their hands. He committed the blunder of blunders.
He gave no preliminary warning. He didn't consult his party. Even his
ministers were in the dark until he had gone too far. It was a
decision very much like that reached by Chifley in 1949 in connection
with control of banking.
Bruce's fatal
mistake was to try to abolish Federal arbitration. It was a complete
volte face. At every election he had campaigned for "law and
order”. He was the great apostle of arbitration. He believed in
arming the industrial courts with greater powers. He believed in
penalties for those refusing to obey the awards of the courts. He
wanted stronger ties between the courts and the parties.
In 1926 Bruce
had
tried to obtain supreme power over all trade unions by holding a
referendum to give the Commonwealth complete control of arbitration.
His real concern at that time was to upset my Government in New South
Wales. He wanted to destroy our 44-hour week. He also wanted to
sidestep child endowment. He also wanted to upset the state basic
wage. But the people had rejected his proposals.
Then the Bavin
Government came to power in New South Wales in 1927. The Nationalist
Consultative Council believed that Bavin could do what Bruce had
failed to do. They still wanted to get rid of the 44-hour week, which
I had enacted by legislation.
Bavin promised
that
he would do it. He promised to get rid of the Industrial Commission.
In particular, he promised to get rid of Mr. Justice Fiddington, who
was a thorn in his flesh. His first suggestion was that he
abolish the
court
altogether. He would rely on a kind of collective bargaining. There
were to be committees of employers and employees. But they were to be
drawn from panels approved by the Government. When Bavin realised
that his plan was not practicable, he compromised by appointing two
additional judges to the Industrial Commission – Mr Justice Street
and Mr Justice Cantor. They could, if necessary, outvote the chairman
of the commission, Mr Justice Piddington.
But Bavin
could not
go through with his complete plan while the unions could still go to
the federal courts. It would be no use abolishing the 44-hour week
for state awards if a frederal judge could still give a 44-hour week.
Bruce's first reaction to the pressure of big business was to suggest
to the premiers that they should hand over all their industrial
powers to the Commonwealth. He proposed an alteration of the
constitution by consent. It was to be another Loan Council formula.
But Phil Collier, from Western Australia, shied clear. He didn't
trust Bruce. Queensland objected. Even Victoria had doubts. So Bruce
had to retreat again.
Then the big
four
told Bruce that the costs of production must be reduced. That meant
that either wages had to be reduced or the working week lengthened.
It could mean both. There was also a very important recommendation
reading:
"A change in
the method prevalent in Australia of dealing with industrial disputes
appears to us to be essential, and we hold that there should be a
minimum of judicial and governmental interference in them, except in
so far as matters affecting the health and safety of the persons
engaged in industry may be concerned."
Bluntly, that
meant
the return to the law of the jungle. Arbitration had protected the
workers against sweating, against starvation wages and excessive
hours. Now they wanted to go back to those vicious practices. Bruce
was only too willing to listen to the big four.
Bruce
also resented the hostility aroused over his withdrawal of the
summons against John Brown. Hughes told him to his face that it meant
the loss of thousands of Nationalist votes at the next elections. The
big fines inflicted on the timber workers, the waterside workers and
E.J. Holloway had only hardened opinion against the government. Bruce
didn't like criticism, especially when it came from powerful
newspapers like the Melbourne Herald and Age. They
were
much too close to home.
Then, without
warning, came the bolt from the blue. Bruce sent a long telegram to
the premiers offering to vacate the field of arbitration altogether
with the exception of the maritime industry.
At the same
time he
sent an urgent wire to members of the Government parties informing
them of his decision. Most of them were appalled. From platforms all
over the Commonwealth they had preached law and order. They had
defended arbitration. They had alleged that the Communists wanted to
destroy arbitration. Now their leader was doing precisely that
himself.
Bruce,
who had wanted absolute power over arbitration, now wanted none. He
had no mandate. No one knew the reasons behind the move.
His own
party organisation was stunned. It
was a
complete
reversal of form.
The
Commonwealth had
been in the arbitration business for just five years. The first
Commonwealth Arbitration Act was passed in 1904. C. Kingston had
drafted it and crusaded throughout the country explaining ow it would
bring peace and justice to industry. He had been backed up in the
early stages by his Prime Minister, Sir Edmund Barton, and later by
his successor, Alfred Deakin. It was Deakin who described it as the
"new era in industrial relations". Then Mr. Justice Higgins
had laid down the foundations of the New Province in Law and Order,
as he described his court later.
For a quarter
of a
century every federal government had been trying to obtain more, and
not less, powers over industrial matters. Now Bruce was trying to
destroy it with one savage blow.
All the
federal
awards were to go into the discard. State awards were to prevail. The
state governments were to have absolute power to define conditions
governing hours and wages. But still no one knew what had moved the
usually cautious Prime Minister to such a revolutionary state of
mind. His own followers were as nonplussed as the unions. The
engineers and the railwaymen had spent thousands of pounds in
preparing and arguing cases in the Federal Court. Now they were to be
denied an award. But why?
One
explanation was that the attorney-general, Sir John Latham, had been
so upset over the withdrawal of the John Brown prosecution that he
had insisted that there must be no halfway remedy. If the government
was going to retreat before John Brown, then it could not afford to
stay in the field. It couldn't have one kind of justice for the
wealthy mine owner and another for a striking unionist. If that was
the reason it at least did Latham considerable credit for
consistency, even though the proposed remedy was a death-dealing
purgative.
The timetable
of
events was most interesting. The vote on the John Brown censure
motion was taken at 7.30am on Thursday, August 22, 1929. At 3.30pm
that afternoon, Bruce rose in the House and produced his bombshell.
He gave notice of his intention to bring in a Bill, called the
Maritime Industries Bill, which would deal with industrial matters in
relation to trade and commerce. Theodore, who was leading the Labor
Party in Scullin's absence, wanted to know something about the
proposal. But Bruce told him that he would have to wait until the
second reading stage.
Dr Page then
presented his Budget. It contained a couple of shocks. But the
treasurer was full of abounding optimism about the future.
Next day Mr
Bruce
produced his Maritime Industries Bill. The reason for the title was
that the maritime and waterside workers were to be the only unions
left with Commonwealth awards. They were to come under the trade and
commerce powers of the constitution. The Conciliation and Arbitration
Act was to be repealed. Existing federal awards were to remain in
force only until June 1930. After that time they would come under
state awards.
The
arbitration judges were not to lose their jobs. They were to become
judges of the Maritime Industries Court. They would look after the
seamen, the marine stewards and the wharfies only. But they would not
make the award in the first instance.
Instead
there were to be committees representing both sides with an
independent chairman, who could be a judge. But the unions were not
free to nominate their own representatives. The government would do
that out of a panel submitted. The chief judge would make the
recommendations. There was to be no evidence in open court. The
entire proceedings were to be in-camera without calling evidence.
There
was also provision that the tribunals had to take into account the
economic effect of their awards on the national economy. The Maritime
Court would have the right of reviewing decisions reached by the
committees. It would automatically review every decision, whether
there was an appeal or not. The new formula satisfied the shipowners.
They didn't want to have their profits made public. They didn't want
their affairs probed.
For the rest,
all
the awards were to be torn up and tossed in the wastepaper basket.
Why was Bruce taking such revolutionary action?
His
theme was that Australia was already in a grave financial and
economic plight. It was the first time the Prime Minister talked
depression. To cure the depression he had one magic formula: get rid
of arbitration. He offered it as his contribution to the economic
crisis. His reason was naive: "The passing of this legislation
will free industry from many of the embarrassments from which it has
suffered in the past."
By industry,
Bruce
meant big business. He meant Flinders Street, the shipping combine,
the coal vend, industrialists and the graziers. How were they being
embarrassed? By the shorter working week and award wages.
Bruce
left the nation under no misapprehension. His policy was going to
suit the John Browns. Of course, he clothed it in his usual
self-righteous unction, that the Bill was not being brought forward
in a party spirit. It was simply for the benefit of the nation and
the empire. Later he was to regret his statement that it was
non-party. Some of his own followers took him literally.
Then he
proceeded to
outline the plight of the nation. Public finance was in a bad way.
Both the Commonwealth and the states had deficits. Bavin had one of
more than a million, while Page had one of almost five millions.
Prosperity was rocking badly. Loan money was difficult to obtain
abroad. Public expenditure had to be reduced. But he still didn't
believe that he could abolish old age pensions or reduce them. So
taxation had to be increased. But he was afraid that increased taxes
might increase the cost of production.
Wool and wheat
were
the only two products which could be sold at a profit abroad. Even
there there had been a heavy decline in prices. Secondary industries
were being threatened by imports from abroad beingsold lower than
local prices. But Bruce said that he could not agree with any
increase in tariffs.
Then Bruce
produced
his magic elixir. The costs of production must be reduced. So they
must get rid of duplication of awards and tribunals. His solution was
a kind of collective bargaining. But because of large-scale
unemployment, that placed the employer in the box seat when it came
to the bargaining. So the government had decided to vacate the field
of arbitration. Bruce wanted round-table conferences. Then the
workers would realise that their claims for higher wages, shorter
hours and better conditions would only lead to more unemployment. He
was suddenly all in favor of the American system of collective
bargaining instead of having industrial courts.
In particular,
Mr.
Bruce thought the workers should accept the piecework system and
payment by results. They would then earn enough to keep their
families. Of course, there would need to be safeguards.
"At present
Australian industries are passing through a serious economic crisis.
Tens of thousands of our workmen are unemployed. It is essential,
therefore, that we should all recognise the urgency of improving the
relations between employers and employees," he said.
He also wanted
equality in competition between the states. "Has any more fatal
blow been struck at equality in interstate competition than the
44-hour week and child endowment legislation of the last Labor
government New South Wales," asked Bruce, again trotting me out
as his King Charles' head. But he still had no idea of the political
hurricane building up. He was not left long in suspense.
Of course,
Bruce
knew that he had enemies. The enemies within his party were more
dangerous than any on the Labor side. Chief of them was the
irrepressible William Morris Hughes, who had founded the Nationalist
Party. There were times when he believed that he had founded the
Labor Party. That, of course, was historical licence. But there was
no doubt about him being expelled from the Labor Party. There was
also no doubt that he founded the Nationalist Party after the
conscription break. He even hand-picked his own executive.
But his break
with
Bruce was now irretrievable. He was out to get his revenge for what
he believed was the double-cross perpetrated by Bruce in 1923. He had
waited patiently for almost seven years. Now it seemed as if might
get his opportunity. But Bruce got in the first blow. He expelled
Hughes from the Nationalist Party. With him went E.A. Mann, a caustic
critic of the government, who was Nationalist member for Perth.
The Labor
member for
East Sydney, Jack West, raised the matter in House when he asked
whether Hughes and Mann were to be barred from certain rooms and, if
so, for how long. Bruce tartly replied that if he wanted know whether
it was true that Hughes and Mann would not in future be invited to
attend meetings of government supporters, the answer was in the
affirmative. In short, they had been expelled from the Parliamentary
Nationalist Party.
Riley Senior
then
asked Bruce whether the Nationalist Party had blown out its
brains. Bruce said the suggestion was completely unwarranted. Frank
Brennan followed by directing the attention of the Speaker to the
fact that P.G. Stewart, Country member for Wimmera, had withdrawn his
allegiance to the government, that the member for Wannon, A.S.
Rodgers, had retreated to a private room in the basement of
Parliament House, and now Mann would need a room, while even W.M.
Hughes had been turned out of his own house. He wanted to know what
steps the Speaker intended to take to accommodate all the segments of
the government that were breaking off. Latham suggested they could
all find refuge in the Labor Opposition rooms.
Bruce still
had the
numbers if he could hold the rest of his party together. His proposal
was not getting the newspaper support he had anticipated.
Theodore, in
the
absence of Scullin, led the attack for the Labor opposition. He said
at the caprice of one man, and without warning, the Bill had been
flung on to the table of the House. One man was about to undo the
work of generations. It was a wrecker's policy. He recalled all
Bruce's speeches in favor of arbitration. How he would never give it
up. How Latham had defended it.
Bruce had
appointed
a royal commission to inquire into the constitution. It had not yet
finished its work. Yet the government was going ahead without waiting
for the report.
Theodore said
Bruce
was the prophet of doom. Whenever an anti-Labor leader wanted to take
away reforms, or reduce wages, he invariably tried to justify himself
with doleful prophecies. Even Sir Robert Gibson, chairman of the
Commonwealth Bank, had said things were not as bad as they were being
represented. The stock exchange was still buoyant. To Theodore that
was most important. Bruce was imagining the difficulties. The stock
exchange quotations were at their highest level in 20 years. The
banks were making record profits. So how could there be a depression?
The
attorney-general, Mr Latham, tried hard to defend the proposition. As
usual, he was academic. Latham argued from a legalistic brief. He had
no time for political rhetoric. He tried to rely on logic. But he was
arguing against his own previous convictions. He tried to rationalise
the problem. He went back over the dry legal tomes dealing with the
development of industrial law in Australia: the Harvester judgment,
the engineers' case. They were all given full treatment. He was on
the defensive. He referred to the strikes of the marine stewards, led
by Bob Heffron, the engineers, the waterside workers and the timber
workers.
But he made no
mention of the lockout of the miners. He said the unions had
campaigned against arbitration. Senator Arthur Rae had written a
book, The Curse of Arbitration. The ARU had rejected
arbitration. Yet, at other times, the government was attacking those
against arbitration as red-raggers and extremists.
Then Latham
gave the
show away. He referred to the action of my government in passing the
44-Hour Week in 1926. He said that if the timber workers had been
deregistered in the Federal Court they would have obtained a 44-hour
week under a state award. The government was clearing the way for Mr
Bavin to bring in a 48-hour week again in New South Wales.
At that time
there
were only 88 federal awards in force in NSW as against 455 state
awards. Once the state government had sole control of industrial
matters, Mr Bavin could impose whatever industrial conditions were
wanted by the Nationalist Consultative Council.
Latham
rejected a
suggestion by Curtin that the men could elect their own
representatives to the Industrial Boards for the maritime industries.
Frank Brennan said the proposal was begotten out of a craven spirit
by cynicism. Bruce had given the impression that he knew little or
nothing about the subject, while Latham had given the impression that
he knew all about it but wanted to keep it dark.
They had
appointed
their own judges at bigger and better salaries, with bigger pensions
and tenure for life. Now there was to be a dismal procession of
self-confessed failures going back on their tracks.
Labor members
like
Norman Makin, J.B. Chifley, George Martens and Ted Riley Sen, who had
practised in the industrial courts as advocates, trotted out all the
achievements of arbitration. They were more legal than the lawyers.
They cited the Commonwealth Law Report. They talked about common
rule, and gave forth with lengthy extracts from various judgments. It
was almost as if they were being deprived of their professional
status.
Bruce's
chief defender from New South Wales was Archdale Parkhill, who had
been Hughes' chief propagandist when the Nationalist Party was first
formed. He later went into the federal Parliament as member for
Warringah. He said that when he was speaking on one street corner in
Mosman, Theodore had been on another supporting
the AWU
candidate. Parkhill said that Theodore had said: "Mr Lang must be
disciplined
ruthlessly, with the gloves off." An interjector had retorted,
"Your number is up for Dalley," and Theodore had replied,
"There will be no shrinking on my part." Yet, said
Parkhill, a few months later Theodore was licking Lang's hand.
Parkhill didn't like me. In that respect I was second only to Jock
Garden in his hate list.
Then E.A.
Mann,
Nationalist member for Perth, entered the lists against Bruce. He
started off delightfully by recalling Greek customs:
"A quaint
local
custom of one of the old Greek states was that anyone desiring to
bring into the state a new law should appear before an assembly of
the citizens to propound that law with a halter round his neck, so
that should the law not meet with the approval of the assembly, or
not be considered necessary for the requirements of the state, the
halter might properly be used to strangle him."
W.M. Hughes:
"Oh,
that those days might come back again!"
Mann replied
they
had. If the House rejected the Bruce Bill, the government would be
politically executed.
In his budget
Page
had opened with a note of cheerfulness, with what was the triumph of
hope over experience. Next day the Prime Minister had reversed the
picture. Yet Bruce had described people who had issued similar
warnings as Jeremiahs and croaking pessimists. Now he was saying, "We
are in a bad way. We can't carry on." Now he said the only way
was to reduce the cost of production. By that he meant reducing
wages. Mann said the government was helping the Communists, who also
attacked arbitration.
Bert
Lazzarini quoted an interview given by Bavin to the Sydney Morning
Herald, which indicated that he also proposed to scrap the
existing system of arbitration. He proposed to follow the Bruce
model.
Then another
prominent member of the Government side took the floor against the
measure. He was G.A. Maxwell, K.C., member for the blue-ribbon
Nationalist seat of Fawkner in Victoria. He said that Bruce had said
that the Bill should be considered on non-party lines. He proposed to
accept the invitation. He refused to be branded a rebel or a traitor.
He proposed to exercise his own judgment on a matter of grave
national importance. The government had no mandate. It was against
the Nationalist Party program. The party had not been consulted. He
refused to be bound by the Prime Minister's whim. His electors had
returned him believing he supported arbitration. The first he knew of
the volte face was the receipt of the Prime Minister's urgent
telegram. He had reserved his opinion until he had heard the Prime
Minister's defence. Having heard, he was satisfied that he had not
made out a case. Instead of providing one supreme authority in
industrial matters, the government was creating six –the state
tribunals.
Maxwell was a
brilliant lawyer. He dissected the measure. He exposed the weaknesses
of the government's arguments. He described it as the negation of
every principle for which the Prime Minister was supposed to stand.
In particular, he stripped Latham's case of all its supports. He even
had a dig at the moral and spiritual aspects of the matter. With
regret, but without misgiving, he proposed to vote against the
measure.
On Thursday,
September 5, the debate was resumed in a sitting that was to last
until 12.30pm on the following Saturday. For two days and nights the
Bill was torn to shreds.
W.M. Hughes
took up
the attack. He said that it was without parallel in Commonwealth
legislation. For 25 years they had advanced towards their goal. Every
party had wanted more power. Now the Bruce government had sounded the
trumpet for a general and shameful retreat. The temple of industrial
arbitration was to be torn down. Not one stone was to be left
standing. Bruce's speech was full of sophisms, irrelevancies and
platitudes. Latham had made a pretence of logic but had followed his
leader. After being in recess for six months, the government now said
they had to day and night to get the bill through. Delay would be
fatal. Had some at financial cataclysm occurred?
Bruce had
accepted a
portfolio in his ministry knowing that arbitration was part of its
policy. When Bruce became Prime Minister he took the policy with him.
He had gone to the people for a mandate to enforce the industrial
law. He had obtained his mandate. Now he said that compulsory
arbitration was wrong, penalties were barbarous and all courts and
tribunals must go. Yesterday he was the protagonist of penalties.
Today he preaches the gospel brotherly love. The parties are to turn
the other cheek, penalties are to be kept away. The system is as it
was 10 years ago. It is the Prime Minister who has changed. He says
he believes in a high standard of living, but the cost of production
must come down. So he proposes to abolish the courts that have been
the guardians of the economic and industrial welfare of the people
and the only barrier between them and chaos.
"What would
happen if the parties didn't agree?" asked Hughes. The framers
of the constitution had placed arbitration in the constitution just
after the greatest industrial conflagration the country had ever
seen, and while its embers were still warm. Those men had seen the
"print of the nails," they had thrust their fingers into
the wound. He was reminded of the limerick:
There was a
young
lady of Riga
Who went
for a
ride on the tiger
They came
back
from the ride
With the
lady
inside
And a smile
on
the face of the tiger
That would be
the
position of the workers. If the price of meat came down would not the
graziers suffer? If the price of bread was reduced, would not the
farmers get less for their wheat? Mercilessly Hughes stripped Bruce
down to his very spats. Bruce was a dilettante, said Hughes. He had
made one attempt to amend the constitution but had walked out leaving
the job to Latham. He had been recreant to his trust. He had betrayed
the people. He had insulted their intelligence. He had affronted
their sense of decency. "He is the creature of a day. What he
does today, another can undo tomorrow." The Bill was an attempt
to save his face so that he would not be eternally confronted with
the ghost of the hideous blunder he had made when he had withdrawn
the prosecution of John Brown.
Frank Anstey
quickly
tangled with his old adversary, Dr Page. He said that the treasurer
had lifted the debate to the lofty eminence of the sewer. "Far
better it is to be ignorant than to be cultured, educated, talented
and to sell one's talents for the first mess of pottage that offers,"
said Anstey, attacking Hughes' former colleagues in the ministry who
had betrayed him for Bruce.
P.G. Stewart
was
another to declare himself against his former leader. He said while
the mines were still closed, the women were starving, John Brown
still could be seen at Randwick with his field glasses slung over his
shoulder.
Hughes: "John
Brown's body lies a-moulderin' is the grave but his soul goes
marching on."
Stewart said
members
of the government had referred to trade unions as "basher
gangs", "a seething mass of maggots", "running
sores", and "fangless snakes." He would leave them
with such nauseous expressions. He would oppose the Bill.
Bruce,
in reply, showed how deeply he had been nettled by Hughes. He
referred to his "sinister suggestions, poisonous and offensive
charges". At one stage in Bruce's reply, Hughes interjected
"Hear, hear." The Speaker called him to order. Hughes
naively wanted to know how he had offended. He was told that it was
the tone in which he had uttered it that was offensive. Billy
repeated "Hear, hear." Bruce admitted it was contrary to
his party's platform with Hughes interjecting. "L'etat, c'est
moi." Bruce again repeated that the depression was not
temporary and was due to a fundamental defect.
The second
reading
passed by 34 to 30 with W.M. Hughes, E.A. Mann, G.A. Maxwell and P.G.
Stewart voting with the opposition.
But the fight
was
not yet over. When the Parliament adjourned on Saturday afternoon, it
still had no idea of the events ahead.
At the weekend
members returned to their homes believing that the crisis was just
about over. But Bruce was still very worried. He fully realised that
the fight was entering the critical round.
Although
arbitration
was the issue before Parliament, outside there was raging a new
political tornado. In the Parliament it was kept severely in the
background. But in every city and in every bush town the people were
experiencing the full impact of the best organised political pressure
campaign in the history of the Commonwealth.
The movie
interests
had declared war on the Bruce government. The talkie age had just
arrived. Like their own product the movie people had switched from
the old silents to full-blast talkies on the political front. But the
bad men were not the villains of the Hollywood sets. They were in
Canberra.
Stanley
Melbourne
Bruce and Dr. Earle Page were being depicted as trying to foreclose
on the mortgage of the old movie homestead. They were trying to rob
the poor widows and orphans of the movie moguls. They were the
vampires sucking the blood out of the innocent film distributors'
bodies. It all arose out of a very small mention in Dr Page's Budget
speech. After explaining that there was a heavy Commonwealth deficit,
he announced that the Government had decided to increase taxes.
Income tax was to be increased by £10 millions. In addition it
was proposed to levy an Amusements Tax.
Page proposed
a tax
of 5 per cent., or 1/- in the pound, on the total receipts for
admissions to all entertainments. "This tax will be a levy upon
a national luxury, which, it is considered should make a special
contribution in the present circumstances." In those days it was
still possible to obtain admission to a film theatre for a shilling.
To suggest that those indulging themselves to that extent were
plunging into wanton extravagance was hardly good politics.
Page said the
government expected to raise £600,000 from the tax. He pointed
out that attendances at amusements had risen from 78 millions in 1922
to 126 millions in 1928. What he overlooked was that they mostly had
votes. To make matters worse, the government announced an extra duty
of a penny per foot on all foreign cinema films imported into
Australia. The film interests immediately got busy. They abandoned
political neutrality. They decided to go after Bruce and Page. The
campaign was organised by the Motion Picture Distributors'
Association. Its president was Sir Victor Wilson. He had been
minister for markets and migration in the Bruce-Page government from
1923-26. He had been close to Bruce. Now he was the general in charge
of the forces uniting to defeat him.
Petitions
against
the Amusement Tax were signed in every theatre in the Commonwealth.
Members were bombarded with telegrams. Employees were told theatres
would have to close. Builders were informed there would be no new
theatres built. Shareholders in film companies were told that they`
would lose their dividends because the industry could not stand the
strain. The member for Angas, Mr Parsons, read to the House a
telegram he had received:
Your
persistent silence suggests that you deliberately ignore vested
interests whose life and livelihood is at stake. Unless intimation
received your return immediately, our representative leaves by plane
to demand you take action.
Jepson,
Secretary, United Amusement Interests.
The movie
strategists realised that they could not defeat the Amusements Tax in
the House. But the Maritime Industries Bill to abolish the Federal
Arbitration Court provided them with their best chance. If they could
defeat Bruce on that, then they believed they were in the clear.
All the
weekend
there were feverish discussions. Every member was lobbied. The Labor
Party realised that it was getting unexpected allies. It didn't
hesitate to give the necessary pledges not to go ahead with the
Amusements Tax. The idea of having all the resources of the movie
people to call upon appealed greatly to Theodore.
In order to
upset
the government it was necessary to get three more votes, in addition
to those who had voted against the government on the second reading.
Hughes was
carrying
the keg of dynamite. He had the time fuse all ready. Nothing gave him
more satisfaction than this chance to get even with his two greatest
enemies. He knew that Mann, and P.G. Stewart would do anything to
assist him. They hated as much as he hated.
George Maxwell
K.C.
had already indicated that he was against the Prime Minister on
grounds of principle, because it was a volte face on party policy.
W.J. McWilliams, the Nationalist member for Franklin, had also
indicated that he was against the bill being rushed through, and saw
in it some kind of threat to Tasmania.
That made up
two
votes. Another was necessary. Where was it coming from? That was the
big question canvassed over the weekend. There were all kinds of wild
rumors. Bruce said that if there was any delay in implementing the
proposal, he would go to the country.
Hughes
threw down the challenge as soon as the House resumed consideration
of the Bill in committee on the Tuesday. He moved an amendment that
it should not be proclaimed until it had been submitted to the people
either at a referendum or a general election.
Again he
thrashed
Bruce with violating his own platform. He said Bruce had concealed
his intention from the people. He had promised that they would soon
round Cape Desolation and proceed into the Bay of Plenty. Instead he
had put the helm hard over and reversed course saying: "Unless
you stand behind me in this, you will walk the plank. Unless you tear
up your election pledges, I will excommunicate you."
Hughes
accepted the
election offer. "It will be the end of the government and
honorable members who support it," predicted Hughes "The
verdict will make it impossible for any political thimble-rigger
further to cloud the issue ... Let us go before the people and fight
this battle once and for all." Bruce took up the challenge. He
denied that he had invited his followers to "walk the plank".
Many of them had voted against government measures. But Hughes and
Mann had impugned the honesty and decency of the government on the
John Brown issue. That was why they had been expelled. That was why
they had "walked the plank".
Bruce rejected
the
idea of another referendum. It was not constitutionally possible. He
said that if Hughes' amendment were carried the government would go
to the people. He was confident that he would again win. Bruce's
announcement caused a tumultuous scene. There were cheers and counter
cheers from both sides. Members were rocked by the shock.
J.H. Scullin,
who
had returned from a sick bed for the climax, said the government was
somersaulting on its own policy. It was trying to load the court
against the workers. He said the Prime Minister reminded him of a
regimental sergeant-major marching his recruits around a drill hall.
"The Prime Minister says, `Quick march!' They march. The Prime
Minister says, `Halt, right about face, quick march.' They march
back. They are the political awkward squad."
The idea that
a
politician was not bound by the platform on which he was elected was
outrageous. The government had betrayed its trust to the people.
The
member for New England, Mr. V.C. Thompson, who had openly attacked
the government's proposal in his paper, The Tamworth Northern
Daily Leader backed out. He was not in favor of a dissolution. He
said that the issues would be twisted and distorted. They would have
to wrestle with the prejudice of tens of thousands whose minds were
being poisoned by pernicious American propaganda. He differed with
his leader. He was still in favor of federal arbitration. But a
referendum would be defeated.
"Can the
opposition in this House speak for Mr. Lang?" asked Thompson.
Scullin retorted, "Can the government speak for the big business
and oil interests?" Thompson said that what Lang decided would
go with the Labor Party in New South Wales. So he would vote against
the Hughes amendment.
Then came the
most
dramatic moment of all. A new figure came into the spotlight. He
alone held the destiny of the government in his hands. It was the
immaculate figure of Walter Marks, Sydney solicitor and member for
the conservative blue-ribbon seat of Wentworth. He had served in the
Royal Naval Forces in the First World War and was Parliamentary Under
Secretary for External Affairs from 1921 to 1923. Then Bruce dumped
him.
Representing
the
elite of Vaucluse and Rose Bay, he had expected to be invited to join
the Cabinet on the death of Pratten. Instead Bruce selected one of
his most vocal critics –H.S. Gullett. To make matters worse, he
gave him the portfolio that Marks wanted most, trade and customs. It
was Gullett who took over film censorship. That was Marks' particular
hobby. For two years Marks had presided over a Royal Commission,
which had inquired into the film industry. He had travelled abroad.
In Hollywood he had been feted by the stars. He met Gloria Swanson,
Clara Bow and Joan Crawford. There was even a suggestion that he
might be invited to leave his footprints in concrete. On his return
he spoke for hours about his thrilling experiences. He was full of
plans. But Bruce put his report into a pigeon-hole. Marks was very
upset about the withdrawal of the John Brown prosecution. He knew the
Baron. Some of his clients had money invested in his mines. The Baron
had even bought him a bottle of beer at Randwick. But still Marks
thought the law should have taken its course.
When
Marks rose, the House was tense and expectant. Marks fully
appreciated that the cameras and lights were on him. Veteran gallery
men said that the hushed silence was almost shattering. The fate of
the government was in the balance and Marks knew it. The Herald next
day said: "The house was literally breathless with
excitement. As Mr Marks unfolded his reasons it would have been
possible to hear a pin drop. Mr Bruce alone, of all his colleagues,
remained unperturbed. He was magnificent."
Mr Marks said
that
he had promised his electors to vote for the second reading. That was
his only pledge. He recalled that he had appeared in the first
arbitration case before Mr Justice O'Connor on behalf of the
employees, with Hughes. He proposed to vote for the amendment. He
would not be a party to repealing 15 Acts by a single vote. Even the
graziers were opposed to abolition of the court.
It was the
first
time that he had ever recorded a vote against the government. He
objected to Mr Bruce taking everything into his own hands. He had
failed to consult his party. The Prime Minister had also failed to
consult them on the John Brown case. But his chief grievance was that
Bruce had not consulted him personally on the Amusements Tax. After
all, he was the great authority on that subject.
"If any man
knew the position of the industry, I did, and I should have been very
pleased to give the government the benefit of all the information I
had gained, but I was not consulted concerning the proposed increase
in the tax on amusements," declared Marks.
So Walter
Marks,
faced with the choice between Mr Bruce as Prime Minister and his
loyalty to the movie interests, decided in favor of Hollywood.
"I told the
Prime Minister he would have to go one way, and I would go another,"
he said. He would not follow him in the proposal to impose the
Amusements Tax, so he proposed to register his protest by voting for
the Hughes' amendment. "The present position cannot continue.
Let the people give their verdict. There is one plank of the
Nationalist Party in which I have always believed –that is liberty
of thought, speech and action."
He then
disclosed
that he had been bombarded by telegrams from branches of the
Nationalist Party in Wentworth, although he had only told the Prime
Minister. The telegrams had all been lodged within minutes of one
another. The branches had not met. So who had lodged the telegrams?
He knew that the Nationalists would oppose him, but his conscience
compelled him to vote for the amendment.
That settled
it. The
gallant sailor had torpedoed the Government. The vote was quickly
taken. The House was in Committee with J.G. Bayley in the chair. Sir
Littleton Groom, the Speaker, did not record a vote. He regarded
himself as an impartial umpire above party strife. Bayley's vote was
lost to the government unless there was a dead heat.
Hughes, Mann,
Stewart, McWilliams and Marks all remained in their seats while the
rest of the government side crossed to vote against the motion.
Hughes was once more back with his former Labor associates. He sat
next to Theodore. Marks was in most unusual company, sitting next to
Frank Brennan. The Hughes amendment was carried.
Ayes
|
35
|
Noes
|
34
|
Majority
|
1
|
The Bruce
government
was defeated. Bruce was still supremely confident that the situation
was well in hand. He had little idea of the further shocks in store
for him. |