CHANGE IS NOT OPTIONAL
JOHN CURTIN MEMORIAL LECTURE-1991
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CHANGE IS NOT OPTIONALJOHN CURTIN MEMORIAL LECTURE-1991 |
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When I last had the honour of delivering the John Curtin
Memorial Lecture--in September 1983--I said that there were certain rare
occasions in a lifetime which were bound, by their associations, to be especially
moving and memorable.
Tonight, how much more deeply must those emotions be felt,
not only by me personally, but by all of us here who have a sense of history--at
a time when we celebrate the 50th anniversary of the formation of the Curtin
Labor Government, and celebrate the 100th anniversary of the formation of
the Australian Labor Party--and do so in the university which bears his
name.
We celebrate these key events in Australia's history in
a year in which all our perceptions of human history must surely be heightened
and sharpened under the impact of the extraordinary events now unfolding
before us.
When we consider the events of those two years, 1941 and
1991, bridging 50 of the most terrible and tumultuous years in human history;
and when we consider their impact on Australia and the world, it is impossible,
at least for anyone of my generation, not to feel a sense of excitement,
exhilaration even, tinged with a sense of awe, and impossible not to feel,
above all, a sense of liberation and hope for the opportunities and challenges
which these events hold for the future.
But for those of us of the Australian Labor Party there
is something uniquely satisfying in commemorating both the centenary of
our party, and the advent of the great Curtin Government 50 years ago, in
this pivotal year of 1991.
I use the word "uniquely" in its precise and
correct sense. For I make two assertions:
First, no political party in the world has had its course
shaped more profoundly, more directly by the impact of the landmark events
in world history since 1914--with 1941 the watershed year, and 1991 a year
of culmination.
And second, no political party expresses more fully, in
its own history, and in the history of a single nation, the struggle for,
and the triumph of, the fundamental principle which lies at the heart of
the meaning of 1991 for so many peoples around the world today--the commitment
to elective democracy.
These are large claims. Yet I believe that the study of
Labor's history justifies them--from the first commitment made by the Australian
trade unions to Parliamentary democracy 100 years ago; and, within the framework
of that commitment, the development of the platform, objectives and structures
of the party, under the impact of World War One, the Russian Revolution,
the Great Depression, the rise of Nazism, the outbreak of World War Two,
Hitler's invasion of Russia, Pearl Harbour, the fall of Singapore, the revolution
in China, the Korean War, Vietnam and the pervasiveness of the impact of
the Cold War. I believe that the study of the party's history warrants the
assertion that the Australian Labor Party has been uniquely shaped by its
response to these crucial world events.
At the same time, this international dimension to Labor's
development makes all the more remarkable its central achievement: that
it remains the authentic Australian political institution, that institution
which, above all others, reflects and expresses the Australian character
and the Australian way of democracy.
From that perspective, we can see that the truly remarkable
fact about the Labor Party's history is not its turbulence, or its failures--and
we have had our share; not its inconsistencies--and no organisation as complex
and diverse as ours could exist without them in abundance. What stands out
is the Labor Party's capacity for change and renewal in a world of immense
change, throughout a century of unprecedented change; and yet, at the same
time, the consistency with which it has held to the fundamental principle:
the pursuit of its program through parliamentary democracy. That capacity
has been the key to its strength. Even more, it has been the key to the
strength of the Australian democracy itself.
Never was that capacity so vital for Australia--literally
'vital', for it was a matter of the nation's life--as in the critical year
of 1941.
And no Australian has, in his own life and career, more
thoroughly embodied that capacity for change than John Curtin.
Given this association, given our remembrance of this man
Curtin, this man for the times, who led the nation through times of immense
change, my theme tonight virtually sets itself.
It could scarcely be other than the theme of change, in
our own times of immeasurable change, and the challenges it brings unavoidably
in its wake.
I put these propositions:
It has always been the fact, but never more true than now,
that there are only two choices:
Could there ever have been any doubt which choice this
Australian Labor Government would make?
So I illustrate my theme of change, and support my propositions
about change, by reference to Curtin's own career.
The remarkable events which brought the Curtin Government
to power on 7 October 1941 represented one of the dramatic points of climax
in Australian political and parliamentary history.
But for Curtin himself, 7 October represented the end of
a long period of preparation, not only personal preparation, but a long
hard struggle to prepare the Labor Party to take charge of Australia in
wartime.
It is difficult now to convey the immensity of the task,
because it involved profound and sometimes heart-breaking changes of attitudes--in
the nation itself, in the Labor Party, and, not least, in his own attitudes.
This last factor is one of the keys to Curtin's greatness:
his capacity to change, even when change involved his own deepest feelings,
if he believed the change was essential to the future of the Labor Party
or the safety of the nation. He demonstrated this capacity time and again--in
1931, in 1937, in 1940, in 1941, and, for him, most wrenching of all, in
1942, when he exhausted himself to achieve Labor's historic reversal of
its attitude against conscription in wartime.
In 1931, for example, he had taken the leading role, as
a Western Australian delegate to the Federal Conference, in expelling the
Lang forces in New South Wales for their sabotage of the Scullin Government
and their opposition to the Premiers' Plan. He accepted this duty, even
though he was as trenchant a critic of the Premiers' Plan as a means of
dealing with the Great Depression as Jack Lang or anybody else.
By 1937, he had become absolutely convinced that the international
situation, in both Europe and the Pacific, demanded that the Labor Party
abandon the isolationist, neo-pacifist, position it had taken in the wake
of the horrors of World War One, and the conscription split of 1916. This
was Curtin's theme at conference after conference, especially in New South
Wales, where the fight for Labor unity and the fight for Australia's security
became, for him, an indivisible cause and commitment.
Curtin made a landmark speech in the House of Representatives
on Australian defence during the Estimates debate on 5 November 1936. Its
theme was: "A greater degree of self-reliance in Australia's defence
is essential". Three years before the outbreak of war in Europe and
five years before Pearl Harbour, his speech was uncannily accurate as a
prediction of the situation in which Australia was to find itself. But the
point I make here is that the speech demonstrated Curtin's capacity to run
against prevailing orthodoxies, including Labor orthodoxies.
He told the House of Representatives: "The dependence
of Australia upon the competence, let alone the readiness, of British statesmen
to send forces to our aid is too dangerous a hazard upon which to found
Australia's defence policy."
The UAP Member for Barton, Mr Albert Lane, interjected:
"Great Britain has never failed us."
Curtin replied: "History has had no experience of
the situation I am visualising."
Albert Lane again interjected: "It is all imagination."
Curtin: "No, it represents a reasonable examination
of the possibilities of the situation. Great wars in which Australia's security
is to be imperilled would not be European wars. They will be wars in the
South Pacific."
It has to be remembered that, in 1936, the attitude implicit
in Albert Lane's interjections represented the dominant Australian attitude,
and not just on the part of the Conservative Establishment. The more significant,
therefore, and for most of his hearers, the more unsettling, was Curtin's
declaration:
We should look upon the people of the United States of America, our neighbour across the Pacific Ocean, with a degree of fraternity, disregarding altogether the direct trade relations which their circumstances and ours have produced, as men and women who speak our language and who are of the same common origin. We should not be engaged in saying, as apparently we have been saying in the past, that we do not care a dump for them and in making difficulties for them.
How novel, how radical such sentiments were in the Australia
of 1936 can be measured by the fact that even at the end of 1941, after
Pearl Harbour, Curtin's famous call to the United States, "without
any inhibitions of any kind ... free of any pangs as to our traditional
links or kinship with the United Kingdom" could raise angry criticism
in Australia and deep resentment in London.
But the central message of Curtin's speech in November
1936 was directed towards the Labor Party. It was the signal for the beginning
of an immense change from the basically pacifist and decidedly isolationist
attitudes which dominated the party at all levels, as a result of the Conscription
split and the human tragedy of the 1914-18 War.
But to achieve that change called for all Curtin's powers
of persuasion and perseverance.
Even as late as Easter 1940, when the Nazi-Soviet Non-Aggression
Pact had produced the Fourth Partition of Poland, the rape of Finland and
the Soviet annexation of Latvia, Lithuania and Estonia, this sentiment was
strong enough to produce from the New South Wales Annual Conference the
notorious "Hands Off Russia" resolution, which declared that "the
Australian people have nothing to gain from a continuance of this war".
But after the fall of France in June 1940, with Hitler's
full might poised against Britain, the combined Labor leadership--political
and union--reaffirmed its total support for the war effort, short of forming
a national Government under Menzies.
Curtin defended his cooperation with Menzies: "We
are opposed to the Government of the country, not to the country it governs.
We did not win the 1937 election, so we had to do our best to see that the
country had requisite defences."
Curtin staked his future on a speech to a meeting of 150
union delegates at the Sydney Trades Hall in 8 August 1940:
You and I are faced with an early judgement by the electors. I merely ask for unity ... The job is sticky and getting harder. It would be cowardly for me to slide out.
The heart of Curtin's speech was his summary of his attitude
to the war in Europe and Australia's place in it:
The Nazis in Germany decimated the trade unions. Fascism in Italy began with foul murders and with the thrusting of castor oil down the throats of trade unionists. Those two philosophies are now in alliance against everything that Labor in Great Britain and the Dominions stands for. I remind you that almost the only places in the world in which a Labor minority can raise its head and be articulate today are Australia and Great Britain ... I refuse to allow Australia to be a prey to Nazism and Fascism.
Menzies called the elections for 21 September 1940. The
results were a remarkable vindication for Curtin, but he nearly paid a disastrous
personal price for party unity. Neglecting his own seat of Fremantle for
the sake of his national responsibilities, he was saved by a handful of
votes from our soldiers in North Africa.
But the election result rendered Menzies dependent on the
votes of two Victorian independents. This was the Parliament which a year
later, in October 1941, was to create and sustain the Curtin wartime Government
until Labor's landslide victory of 1943.
Australia's growing danger throughout 1941 intensified
the pressures on Menzies-not from Labor, but from the Coalition. "I
was surrounded," Menzies was later to say, "by doubtful supporters
and appalling half-wits." As Paul Hasluck, another great Western Australian,
wrote in his masterwork The Government and the People 1939-41:
The United Australia Party itself had been disintegrating for at least three years past. The internal loyalty of the party had been damaged by a variety of causes and party discipline weakened over a long period of time, while the party had accumulated within itself the poison of personal disappointments and animosities. Far from binding the party more tightly together, the coming of the war had removed the opportunities it might otherwise have had for internal reconstruction.
The contrast with Curtin's leadership could not have been
greater.
Menzies resigned on 29 August 1941 and the Leader of the
Country Party, Arthur Fadden, was installed in the Prime Ministership. The
Fadden Government lasted 40 days.
Fadden himself used to say: "Like Noah's flood, I
reigned for 40 days and 40 nights". So I suppose Menzies could have
said, appropriately enough: "Apres moi, le deluge".
During the debate on the Budget on 3 October, the two Independents,
Coles and Wilson, convinced that the Coalition was incapable of leading
Australia in wartime, voted with Labor to bring down the Fadden Government
and make Curtin Prime Minister.
Curtin pledged: "We will carry on the war wholeheartedly
and with no inhibitions of any sort or description."
The rest is history--Pearl Harbour; the forging of the
American-Australian Alliance and the Curtin-MacArthur partnership; the fall
of Singapore; the struggle of will with Churchill to bring the Australian
divisions home from the Middle East and prevent their diversion to Burma;
Curtin's lonely vigil while our best troops made the perilous crossing of
the Indian Ocean; the sweeping victories of the Japanese forces; the mobilisation
of civilian and industrial Australia; the searing debate in the Labor Party
over conscription; then from the end of 1942, after one year in office,
the long slow turning of the tide of war.
I have said on many occasions that the most important truth
of all about Curtin and Curtin's leadership was that even in the darkest
and most demanding days of the war, he never lost sight of Labor's peacetime
objectives at home and abroad.
But he based his vision on a world and nation undergoing
enormous change.
Internationally, Curtin recognised the fundamental changes
which had occurred in the balance of forces in the world and in Australia's
strategic situation. One of his greatest achievements was to forge the relationship
with the United States, which all subsequent governments have seen as a
keystone of Australia's security.
Envisioning the postwar reconstruction of Australia, he
foresaw the need for basic change in attitudes, in the nation itself and
in the Labor movement.
In the last years of the war--in the last years of his
life--he began the preparation for change to peace, just as in 1936 he had
begun preparing the Labor Party for war.
He summed up his approach at the Federal Labor Conference
in Canberra in November 1943:
I have said that the world can never be the same in the years to come as it was before the war. Australia's capacity to govern involves adaptability to resolve new problems and meet new conditions. What was good 20 years ago may not be good enough now.
I use that quotation and the approach it represents as
a bridge between the challenges facing Australia 50 years ago, and Curtin's
response on one hand and, on the other, the challenges we face now-and the
response we need to make today. And today, more than ever, in adapting to
new problems and conditions, what may have been good enough 20 years ago
is almost certainly not good enough now.
And I repeat my main theme: either we change ourselves
or have changes imposed on us by the rest of the world.
The first thing is for us all to realise that this tough,
increasingly competitive world of five and a half billion people does not
owe, and will not give, 17 million Australians an easy prosperity. The days
of our being able to hitch a free ride in a world clamouring, and prepared
to pay high prices, for our rural and mineral products, are behind us. From
this fact flows everything else.
The challenge for the foreseeable future is to produce
more than we spend. The rest of the world will not allow us to continue
indefinitely to live beyond our means by borrowing from them.
Our rural and mineral products will remain important into
the future. But the challenge is to add to them. That is, we must export
more manufactured goods and services and substitute more quality Australian
production for imports.
The challenge is therefore to make the decisions and adopt
the practices and attitudes which will enable this and succeeding generations
to achieve those basic goals.
Those are the challenges. How we are prepared together
to meet them will determine the standards we can enjoy and the kind of Australia
we will pass on to our children.
And so in that context, I want to deal with the main area
of change where, as a Government and as a party, we have adopted policies
which of necessity involved new approaches, new responses, new attitudes
and, in key areas, sharp departures from old orthodoxies. That is the area
of economic management, in the widest meaning of that term.
In 1983, we inherited an economy in recession. The early
years of this Government were therefore naturally dominated by the need
to restore growth and reduce unemployment. The goals for which we had received
so convincing a mandate in March 1983 were national reconciliation, national
recovery and national reconstruction. The National Economic Summit of April
1983, and the First Accord laid the foundations for their fulfilment. The
change in industrial attitudes-from confrontation to cooperation-took priority
on our agenda. The pressing need for fundamental changes in other areas
of economic management policy was not then so sharply apparent.
But, during those first years of Government, the signs
emerged: sharp falls in the value of the Australian dollar, a worsening
current account deficit and the associated build-up of foreign debt. By
the middle of the 1980s, the need for fundamental and lasting change in
the very structure of the Australian economy had become overwhelming.
As our Government moved to respond, it became clear that
Australia had reached a fork in the road: down one track lay great challenges,
coupled with the prospect of renewed vigour in our economy; down the other,
an apparently easier ride, but one that would have seen a permanent fall
in living standards, not only relative to our traditional standards of comparison
in Europe, but relative to our rapidly growing neighbours in Asia.
There was only one choice for a Government committed to
bettering the lot of the Australian people, and in particular, its working
men and women and their families. And we made that choice. We embarked on
a program of reform and restructuring unprecedented in Australia's history.
But even in our first year, there was one great change
that we made to breach the walls of orthodoxy--one that marked the first
step on the long road towards opening up the Australian economy. It was
our decision, in December 1983, to float the dollar.
In March, as soon as we assumed office, we had to deal
immediately with an exchange rate crisis. The problems of speculation against
the fixed rate of the dollar recurred later in the year. It was clear that
those episodes would continually recur and would severely limit our capacity
to achieve policy objectives. Accordingly, we took the decision, in company
with many other developed economies, to float our currency and free our
institutions to trade with minimal interference on international financial
markets.
This decision broke a long tradition of a fixed exchange
rate against Sterling and against the US dollar and, most recently, against
a basket of other currencies. It was controversial. It was resisted and
criticised in many quarters. Many saw it as making Australia hostage to
the vagaries of the financial markets.
But it was a decision that was as unavoidable as it was
correct. The international currency speculators had regularly demonstrated
their capacity to make profits by building pressure against the rate the
Reserve Bank was defending. We made the difficult judgement that this long
established, purported sheet anchor of a fixed rate, had, in fact, become
a major source of instability and an unacceptable limitation on policy flexibility.
That judgement has proved correct. Our ability to manage
our external situation to provide the time necessary to achieve essential
structural reform, while maintaining reasonable employment growth derives
from the closer integration of Australia with international capital markets
that floating our currency made possible.
No wise government would be reckless about predicting the
future in regard to the levels of Australia's overseas debt. However, stabilising
it as a ratio of GDP has been one of our central policy objectives. Nor
would I want to argue, in the face of the clear facts, that all this borrowing
has been prudent. But in the midst of the more hysterical commentary, it
is easy to lose sight of the substantial build-up of Australian equity overseas
and restructuring at home that this borrowing has financed.
This year's Budget forecasts foreshadow a stabilising of
the ratio of this debt to GDP--a landmark in the continuing process of adjustment
in which we are engaged, and an enormous set-back for the prophets of doom.
But, returning to my central theme of change, let me go
back to the crisis of the middle of the 1980s, and I use that dramatic and
perhaps overused word 'crisis' with deliberation. For the questions that
confronted us then, as the dollar fell and the current account deficit rose--both,
apparently, without limit--were fundamentally questions of national confidence:
could Australia survive, compete and prosper in this rapidly changing world?
We were determined that Australia's answer would be Yes.
But we realised that it would require a root-and-branch re-examination of
many long-standing features of our national life and of the assumptions
underpinning them.
The results of this re-examination have been far-reaching
and are by no means complete.
But let me mention three examples:
Our first task was to institute a thorough review of the
use Australians were making of our national resources. This was the essence
of our response.
As a Government, this exercise would not have been credible
had we not begun with the public sector.
We worked throughout the remaining years of the 1980s to
eliminate the public sector deficit. In doing so, we demonstrated that traditional
Labor objectives could be achieved, within a balanced budget framework,
by a carefully designed combination of targeted assistance and increased
equity in the tax system. This break with the conventional wisdom that a
balanced budget, or even worse yet, as the postwar orthodoxy had it, a surplus,
could only be achieved at the expense of traditional Labor values, was resisted
in some quarters. But the break with old orthodoxy was crucial. Reductions
in Government's call on national savings have a direct impact on the current
account, allowing a much higher level of domestic investment for a given
deficit.
We also looked at the stock of publicly owned assets. In
many areas, the pattern of public ownership was long established and the
reasons for it long since overtaken by developments in the economy. It has
been critically important that we be prepared to acknowledge the anachronisms
in many areas of public ownership, both to give Government necessary budgetary
flexibility and to improve the performance of the companies and the sectors
of the economy in which they operate.
I believe the recent Commonwealth Bank float demonstrates
the benefits this reappraisal has brought. It has been extremely successful
with many Australian workers welcoming the opportunity to invest directly
in one of our great national institutions, while the Bank itself has been
strengthened by its excellent reception on the share market.
In our policies towards industry, the change has been no
less dramatic.
Tariff protection had been one of the abiding features
of the Australian economy since Federation. It had become an article of
faith. Tariffs protected Australian industry by making foreign goods more
expensive here; and the supposed virtues of this protection became deeply
embedded in the very psyche of the nation.
Right from the start, this Government deliberately and
determinedly set about pulling down the tariff walls. By 1992, our existing
programs will have slashed the nominal rate of assistance to the manufacturing
sector by over one third, from 13 to 8 per cent, and the effective rate
from 22 to 12 per cent.
We have not done this, as some would have you believe,
because we have been converted, to paraphrase Keynes, to views of some long-defunct
economist. We have done this because we believe that the facts of Australian
economic history clearly supports two fundamental propositions.
First, that industries protected by tariffs do not develop
and become internationally competitive, but rather become isolated and fall
further behind world standards, creating a demand for even higher tariffs.
Second, that tariffs burden our export industries, reducing their competitiveness
and, by inflating costs, make the development of new export industries more
difficult.
In short, tariffs reduce the capacity of the Australian
economy to advance living standards.
Now, of course, that process of change, one of the most
radical changes in our nation's history, has involved dismantling some of
our most cherished orthodoxies, held for generations by much of industry--employers
as much as unions. But we are convinced that the tariff walls are an obstruction
against achieving the fundamental objectives of a Labor Government. So we
are removing them.
At the same time, we have seen immense changes in our wages
system, both in retrospect and in prospect.
In retrospect, the great change in the industrial wing
of the Labor movement can be seen as pivotal. Wide acceptance within the
movement of the proposition that workers' interests can, in appropriate
circumstances, be better safeguarded by cooperation than by confrontation
has underpinned much of our success. In many industries, the union movement
has not merely facilitated change--it has set the agenda. On training and
re-training and in reforming awards to make them relevant to contemporary
industrial conditions the union movement has been in the vanguard.
And now, with the Australian Industrial Relations Commission
in the midst of its critical review of the National Wage Case principles,
we confront the prospect of perhaps the greatest changes in our wages system
we have seen. The sharply increased emphasis on workplace bargaining against
demonstrated productivity benchmarks will fundamentally alter industrial
relations in Australia. One indication of the extent of this change has
been the questioning by the Commission itself--the foundation stone of the
wages system--of its own future role.
Those who may have believed, in 1983, that its attachment
to the trade union movement would be a millstone around the neck of the
new Labor Government have been utterly confounded. Confounded because the
industrial wing of our great movement has shown the courage that Curtin
showed in changing and adapting, in spite of the pain and the difficulty,
to further the fundamental objectives, both of the party and of the nation
he loved so deeply and served so splendidly.
This Labor Government has never been in doubt about the
kind of Australia we wish to build--an Australia with a modern, diversified,
competitive and export-oriented economy; an Australia vigorously engaged
with the world economy and enmeshed in particular with the dynamism of Asia
and the Pacific; an Australia committed to maintaining and enhancing the
quality of life, social justice and the preservation of our natural environment;
a self-reliant Australia, not merely fitting in with the world as we find
it, but helping to shape it and capable of taking on the best the world
has to offer--and winning.
This process of modernisation, of adaptation to the changing
world economy, is not something that has some future cut-off point. It must
be a continuing process.
There is no point at which we can say change and reform
have finished--because there is no point at which the world will stop changing.
And this is the essential point. We live in a world of
unprecedented, indeed breathtaking, change. And, of course, the profound
interest and excitement of the events in Europe should not distract us from
the central fact of our future: that our own region is a crucible for change.
We can no longer afford the easy simplicities, the costly complacencies
of the 1950s, 1960s and 1970s. I say "costly" because we are now
paying the price for the neglect of those decades. Our task now is to make
sure that future generations are not called upon to pay a similar price
for any neglect or complacency on our part, in this make-or-break decade.
I put one last proposition--and I put it in all earnestness
to every member of the Australian Labor Party, especially those who are
disposed to criticise our program of change and reform as representing some
kind of unwarranted or unauthorised departure from Labor principles and
tradition. Of course, harsher language is sometimes used, not altogether
unlike that used against Curtin during the Conscription debate in 1942 and
which actually brought him to the point of offering his resignation to Caucus:
the charge that he would end up by leading from the other side.
I ask such critics today just to consider this:
Suppose Australia had not had the great good fortune to
have had a Labor Government for the past eight and a half years, through
the choice of the people in four successive elections. And suppose that
Labor Government had not accepted the need for change, and forced the pace
of change.
And, thinking this proposition through--if Labor, which
would then have been reduced to long opposition, had clung to old shibboleths
and refused to change in these years which, in the very heartland of international
Communism, have culminated in the shattering of the shibboleths of 75 years,
and the shuddering collapse of central command planning--what would then
have been the situation?
I say this: the Australian Labor Party would have run the
very real risk of being doomed, not just to permanent opposition, but to
permanent irrelevance and impotence.
Earlier I quoted part of John Curtin's speech to the Federal
Labor Conference in November 1943, in which he emphasized the need for change
in our national habits and attitudes and way of thinking about things and
our way of doing things. John Curtin had no doubt how that was to be achieved.
He had no doubt that the Australian Labor Party alone had the capacity to
change itself and thereby change the nation. He concluded his speech to
Federal Conference in November 1943:
The Labor Party has a great tradition in organising cooperation for the welfare of the mass of the people. It is peculiarly fitted by knowledge, experience and the confidence of the people, to lead them towards the wider horizons of cooperation now appearing before mankind. If the Labor Party is to maintain its place in the vanguard of the march of human progress, it must not fail to do its part in this momentous opportunity to bring nearer to achievement the fellowship and welfare of all peace-loving peoples.
That was John Curtin's declaration of faith in Labor's
historic role. His words ring down five decades, and never with greater
resonance than today.