Who Earns What at Their ABC?

July 24th 2017 print

TONY THOMAS

Unlike its British counterpart, Australia’s national broadcaster insists that a right to privacy shields salary disclosure for the likes of Tony Jones, Barrie Cassidy, Jon Faine and all the well-heeled rest, not to mention their ABC partners, spouses and lovemates living well on the taxpayer dollar. Still, there are clues…

their abcThe country has Pauline Hanson to thank for winkling out some further particulars about how much the ABC’s top-20 on-air stars gets paid. ABC managing director Michelle Guthrie has now provided written replies to Hanson’s written questions from the Senate Estimates hearings of last May.

In a nutshell, she says her five top stars are paid $375,001 to $450,000;  six pocket $300,001 to $375,000, and nine get $225,001 to $300,000.

“The remuneration information of ABC staff amounts to personal information under the Privacy Act,” Guthrie or her spokesperson says. “Responses to requests for information regarding ABC staff remuneration are presented [as pay bands only] to ensure that the Corporation complies with the provisions of the Privacy Act and that any individual’s personal information is not disclosed.”

Happily, we already have a ranking of the ABC’s top-paid as at 2011-12. This  came about thanks to a dim-witted ABC staffer mistakenly providing a salary spreadsheet to SA Family First Senator Robert Brokenshire. One of the senator’s staffers leaked the list to The Australian in late 2013.

Sure, a spot or three on the rankings may have changed. But it’s virtually automatic that those top people now inhabit the current bands disclosed by Guthrie.

Take Tony Jones, uneven-handed host of the ABC’s execrably Left-biased freak show Q&A. In the original list, he was top at $356,000. Surely ex-ABC boss Mark Scott, now running NSW’s school system,  or his successor, Guthrie, haven’t dragged him from the top spot? So he must now be skating close to $450,000. It’s only reasonable to conclude that if he were on only, say, $420k, Guthrie’s upper pay band definition would have been $375-425k .

The No 2 in the  current list has to be 7.30’s  Leigh Sales, in  2011-12 ranked only sixth on $280,000. Given Sales’ far greater exposure, workload and professionalism than Jones’, it would be odd if the ABC weren’t paying her $400,000-plus. Indeed, Sales’ predecessor Kerry O’Brien was paid  more than Jones in 2009-10, namely $365k. But Sales’ experience  doesn’t compare with O’Brien’s history and faux-gravitas, so I don’t think  Sales by now would have displaced Jones as their ABC’s numero uno.

That leaves three people to fill the rest of the $375,000-$450,000 band. If there’s any ABC rationality in relativity, one slot would go to Sarah Henderson, star of Four Corners and, coincidentally, spouse of Tony Jones. It’s one helluva household pay-packet that taxpayers provide this power couple. Ferguson’s Four Corners on the Lindt siege was great viewing, even if she couldn’t bear to mention how the top coppers were fixated about hypothetical backlash against hypothetical Muslims, even while one real Muslim was wielding his real shotgun within the real café.

The last two slots would have to be the ABC’s Sydney and Melbourne radio stars Richard Glover and Jon Faine respectively,  both on near-$300,000 five years ago. Glover does the afternoon Driveand Faine does Mornings and Conversation Hour.

This list requires a de-ranking of 2011-12’s No 2, NSW TV newsreader Juanita Phillips, who was then on an anomalous-looking $316,000. Let the heavens quake, but I’m sure she’s been nudged to the middle band $300,000-375,000.

This middle band of six can be rapidly populated with workaday stars (2011-12 pay in brackets), viz long-time Radio National Breakfast host Fran Kelly ($255k), political editor Chris Uhlmann ($255k) with his new specialty of anti-Trump rants, Insiders Sunday host Barrie Cassidy ($243k) and high-profile Annabel Crabb ($217k), especially with her Kitchen Cabinet.

Numerate readers will note there’s one $300k-plus slot unfilled, and I admit there’s difficulty here. It is probably a toss-up between News Breakfast co-host and Trump clanger-dropper Virginia Trioli ($236k) and Juanita’s Victorian newsreading counterpart Ian Henderson ($188k). Sorry, Ian, but Virginia’s my pick for the taxpayers’ $300k-plus gravy-boat, if only because of her advantages in gender and overt groupthink.

Hendo would thus go down to the ABC  stars’ paupers Band 3 of $225k-300k. The other eight there are the tough ones to sort out. If the ABC pays for hard work rather than show-pony looks, first in would be US bureau chief Zoe Daniel and London-based Europe chief Lisa Millar. From the past list, sports broadcaster Gerard Whateley  ($223k) would have to be in there too.   TV finance presenter Alan Kohler doesn’t come cheap.  On profile, add in Lateline co-host Emma Alberici ($186k). The last three places would have to be drawn from the likes of all-rounder Mike Brissenden, AM and federal politics’ Sabra Lane, Melbourne Drive radio’s Rafael Epstein, Sydney Afternoons radio’s James Valentine, Radio National’s Pat Karvelas, the lovable Waleed Aly ($187k) and Julia Baird, who did last week’s 7.30 about “Christian Women Told to Endure Domestic Abuse”.

To sum up, here’s Michelle Guthrie’s pay-bands, properly populated:

$375,001-450,000

Tony Jones, Leigh Sales, Sarah Ferguson, Jon Faine, and Richard Glover.

$300,001-375,000

Juanita Philips, Fran Kelly, Chris Uhlmann, Barrie Cassidy, Annabel Crabb, and Virginia Trioli

$225,001-300,000

Ian Henderson, Zoe Daniel, Lisa Millar, Gerard Whately, Alan Kohler, and  Emma Alberici, Plus any three of Mike Brissenden, Sabra Lane, Rafael Epstein, James Valentine, Pat Karvelas, Waleed Aly, and Julia Baird.

Of course, in Britain all such stars’ pay levels at the BBC are fully disclosed. If BBC director general Tony Hall so much as claims for a £7 train ticket, it gets disclosed too. But in Australia that would never do!

Tony Thomas’ book of essays, That’s Debatable – 60 Years in Print, is available here.

 

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Deadline Missed by 50 Years

A young reporter of literary bent is sent in the late Sixties to cover a council meeting, subsequently filing an account that, much to the amazement of the chief sub, invokes Rabelais’ ‘Gargantua’. Spiked in 1967 and only recently re-discovered,  it deserves a run

reporter IIIMany journalists keep their scrapbooks of articles for inordinate periods. When cleaning out a cupboard, I found a volume of mine from The West Australian in the 1960s, the pages  browned with age.

Something unusual fell out, a “copy sandwich” of a story of July 1, 1967, that never got published. In those days we wrote each sentence on a separate half-page A5, so the subs could trim the story to length by throwing away pages. The stack of pages was called a sandwich.

On the top page was a note from the Chief of Staff, Viv Goldsmith: “Tony Thomas – see me about features and news cover (guideline for the future).”

Notes starting “See me” are seldom preludes to positive feedback.  Strangely, the story had traversed the sub-editors’ table and even acquired a note to the hot-metal compositors, “Urgent”. This sub-editor was a moron, turning   my choicest bon mots into the English of phone books and railway time-tables.

I suspect the chief sub had, in a spasm of caution, referred the sandwich upstairs to the editor, who sent it  down to the Chief of Staff with advice to counsel me against levity and disrespect in news reporting.

My aborted story is about a fiery meeting between the semi-rural Armadale-Kelmscott Shire Council and 500 of its electors. The council had summonsed and fined many of them for allegedly neglecting  their firebreaks. The electors had activated some clause in the shire’s constitution to hold their councillors to account.

To set the scene, you probably know that Perth sits on the coastal plain and 30km to the east,  running north-south, are the lightly-settled Darling Ranges, rising to 600m. They’re not exactly the Alps. Armadale-Kelmscott is one of the hillside districts. I probably reported this meeting with special avidity because I  lived  on a half-acre nearby, on Gooseberry Hill.

The sandwich shows signs of poor typewriter hygeine. Each letter ‘r’ falls half below the line and the ‘r’s’ stem is missing, leaving only a mark like a tilde or curly hyphen. But no-one in Newspaper House ever kicked me about my r’s.

Will I ever get round to the story? Here goes:

 Next Best Thing to the Stake

We don’t burn unpopular bureaucrats [subbed to read “we don’t burn people”] at the stake any more, but an electors’ meeting is the next best thing.

The smell of roasting councillors wafted through the Armadale Hall as 500 ratepayers asked questions and said things about last month’s mass fining of firebreak defaulters.

All the Armadale-Kelmscott councillors attended, sitting in a row before the velvet curtains and red drapes of the antique hall. The only cheerful one was Mrs Julie Bethell, who had been elected after the council’s fining sortie.

At 8 pm the meeting opened with the force of a wet match. President P. Kargotich announced that the sound-recording crew (who had decorated the fore-stage with teeming lianas of wires) had forgotten their microphones. Someone was speeding back to Perth (20 miles) to get them. The meeting would start when he got back.

This was like lashing the lions before the Roman games. The packed hall rumbled with discontent for 35 minutes. Some young blades started slow hand-clapping.

“Order,” shouted the microphone-less president.

“Time!” counter-shouted an angry woman.

At 8.45pm a runner panted   entered into the cheering hall carrying a box of microphones. The meeting started with a history of the controversy from the president, read fast and level. Then he called for questions and suggestions from the audience.

Here a misunderstanding arose. The shire thought the meeting had been called so that people could make sensible suggestions about how to reduce fire hazards in future. Most of the ratepayers thought the purpose of the meeting was to do the council over. This misunderstanding was never fully resolved.

The microphone fiasco was grist to the mill. Mr Kargotich disclaimed responsibility; Mr Hugh Leslie, of Kelmscott, said the equipment should have been tested long before the meeting started.

“What is wrong is the shire council, and the whole body of it,” he said, after giving a different history of the fining. “If you can’t lead, then get out and let someone in who can. And if they can’t, we will kick them out.”

Later, there was some confusion between Mr Kargotich and a red-headed youth from the sound crew about whose turn it was in the audience for a microphone.

“You’re an employee of the meeting, not running it,” Mr Kargotich said peremptorily.

Mr Chandler, of East Cannington, rose soon after.

“The way you treated that man gives an idea of how you treat employees…” he began.

Mr Kargotich (divining that this speaker may not be friendly):“Are you an elector?”

Chandler: “I’m a ratepayer.”

Kargotich: “Are you an elector?”

Chandler: “I am not of the district.”

Kargotich: “Well, will you sit down.”

Chandler: “I am being fined. Does that give me the right to speak?”

Loud cheering from the hall, and Mr Chandler spoke on.

Things got so hot after a while that Mr Kargotich had to remind a woman speaker that her remarks about a council employee were going on record and she might regret it if she continued (he was referring to the laws of slander).

Near the end of the meeting, the crisis point arrived, with a motion from an impassioned Mrs Mann of Roleystone that the whole council resign. Her family had collected seven summonses, reduced by the council later to one. The motion came unexpectedly, rather like the baby that popped out of Gargamelle’s left ear.

[At the time I was doing post-grad English literature at UWA, where I would have picked up this bit of anatomical fancy in Rabelais’ ‘Gargantua’ of 1550. In that pre-Google era, I must have had the book handy].

Mrs Mann first objected to the ‘bombastic’ manner of the chairman, Mr Kargotich. She thought he was paid by ratepayers and should be nice to his employers. Mr Kargotich said he drew no salary.

“What do the 3 per cents go to then?” she demanded.

Mr Kargotich explained that legally, this money could be spent at the council’s discretion, and his shire spent only half of it, and that half, on worthy ends.

“I was told that at each council meeting cigarettes were passed around. Is this little enjoyment from the 3 per cents?” she asked meaningly.

Shouts to “Siddown!” came from around the hall.

“I would like to see the whole council resign,” she finished.

This took everyone aback, but Mr Kargotich, unruffled, asked if she wished to move a motion. She did.

Mr Carlson, of Roleystone, tried vainly to cancel the motion, arguing that a vote against the council would be dangerous and that a vote for the council would be seized on by the council as evidence of popular support.

“If passed, the motion would be considered by ourselves,” Mr Kargotich said. “We make the decision.”

After a short speech or two against the motion, it lost by about 450-50.

Our next electors’ meeting on July 7 concerns Paul Ritter and the Perth City Council. I advise the council to look to its microphones.   Ends sandwich.

Understandably, I wasn’t assigned to report that Perth council meeting, a pity as it sacked its town planner, Mr Ritter, soon afterwards. Ritter gazumped the council by getting elected to it  for 16 years. He was runner-up as Perth citizen-of-the-year in both 1974 and 1976 but  got a three-year stretch in 1986 for a dodgy application for a Commonwealth export grant. Doing time is an occupational hazard for Perth celebrities.

Well, that ends my trip down memory lane. Reporting council meetings in those days was at least a step up from reporting the Magistrate’s Court.  The West’s policy was to include particulars of old lags who ‘committed a nuisance’ in the lanes of our fair city.

I’ve just realised: it’s the 50th anniversary of when I wrote the firebreak story. Spooky!

In this month’s Quadrant, Tony Thomas writes about Menzies’ affection for price-fixing cartels.

The Velvet Glove of Harry Knight

 

Harry Knight, from 1980 Sir Harry, was Reserve Bank Governor from 1975-82. He died in 2015 at age 95. His grandsons include brothers Dominic and Jasper Knight, who have high public profiles as an ABC Chaser Boy (Dominic) and an award-winning artist (Jasper).

I wrote this piece largely as relief from the tedium of sitting through evidence to the Campbell Inquiry into the Financial System. I also used The Age to publish my original research into the proportion of top-tier bankers who do actually wear pin-striped suits.

 

The Velvet Glove of Harry Knight

Tony Thomas, The Age, 17/11/79

Like an ancient king, the Reserve Bank Governor, Harry Knight, appears seldom in public, and then always with dazzling effect.

He dazzled everyone at the Campbell finance inquiry the other day, radiating charm, humility and a penchant for Hamlet-like introspection.

The face that launched a thousand suasions is lean and ascetic, topped by a tousle of wispy grey hair.

He clothes his slender form in a very nice suit, with broad black and grey stripes, somewhat like the convicts in Sydney Nolan paintings.

And answering questions from the committee, he chirrups away as if he has not a care in the world, but is merely bandying pleasantries with six long-trusted chums.

All that was lacking was a fireside glow and a glass of port (1905 vintage) in hand, little finger slightly raised from the stem.

In every way, he is a credit to Melbourne’s Scotch College.

Just once that day the velvet glove slipped. He was asked by chairman Keith Campbell how odften the banks came cap in hand to Harry to get a lender-of-last-resort loan.

“Perhaps you will tell me if I am too wordy,” Mr Knight began – his usual line of patter while he worked out a sensible answer, which was –

“Use of the last-resort facility by banks has been infrequent and [he smiles like a white pointer shark] excruciating to them.”

Mr Campbell: “You would be referring to the interest cost? – Yes, sir.”

The younger Mr Knight had an unusual war career. He began with the AIF as a gunner on sound-ranging duties, then transferred to the navy to do hydographic work. There was nothing effete about that job. He served on small ships that used to scoot ahead of task forces moving to landings on Pacific islands. His boat would take soundings, under the eyebrow of the Japanese, to chart the invasion route – fairly dicey work as one bank colleague put it, which won Lt Knight a DSC.
Harry Knight’s only publication is titled Introduccion al Analisis Monetariok an obscure work in Spanish not yet translated into English.

His friends in the banking world told me that it is a novel about a bullfighter’s love for a communist spy in the Civil War, who was posing as a flamenco dancer in Franco’s headquarters.

But a Reserve Bank spokesman issued a strong denial. He said it was a collection of ten lectures on central bankng that the Governor gave in Mexico while he was doing a stint with the International Monetary Fund. He’s still fluent in Spanish.

The chatty Knight style is illustrated by his denial to Keith Campbell of Reserve Bank responsibility for the reduction in trading bank share of financial markets. He said there was a tendency of people to wave the statistics at him, and while he was ‘reeling from it’, people would say to him [he raised his arm and pointed accusingly], ‘It is all your fault!’

But he had to say, ‘Now that is a bit thick’ because there were a lot of bright people in the intermediation game carving out their own shares in any event.

“If you press me and say, ‘Come on Harry Knight, tell me what proportion of non-bank growth is attributable to your activities’, I have to smile sweetly and say, ‘I have no idea’,” he said.

Like Dickens Mrs Gamp, he is prone to invent people who then argue with him, saying ‘Harry Knight this and Harry Knight that’. Harry, in the course of these bouts, awards himself the last word and the crushing retort.

‘Are you watching for squalls, Harry Knight? Squalls can hit you without your being aware of it and you have to handle them real fast’, he warned himself once.

When the Treasury’s Fred Argy threw him the usual trap question, he replied winningly, “Mr Chairman, that is a lovely question and I am very grateful for it’. It was like watching a gentleman debating with a footpad.

The initial burbling by Mr Knight is characteristic. He operates like a champagne bottle, giving off a lot of froth before any genuine liquor emerges.

Sometimes it is hard to know if he is being sarcastic or merely effusive, as when he described the State savings banks (which tend to dodge the Reserve Bank’s network of controls) as ‘lovely people’.

He would love to relax the Bank’s controls over foreign exchange, but because of the disorders abroad, he would have to say with St Augustine, ’God, make me pure, but not yet’.

He agreed people might say to him: ‘It’s a fair while, Harry Knight, since we’ve had a wave of new foreign banks here’.

“Like the Presbyterian elder, I’d reply, “That is a great difficulty. Let us look it squarely in the face and pass on.” #

 

 

The New Hiroshima

I wrote this piece when I was 36.

Tony Thomas, The Age, 21/7/1976

 

“Rest in peace, for the error shall never be repeated.” This is the official translation on the script of the A-bomb cenotaph at Hiroshima sited directly below the explosion point.

You normally find an English subscript but the cenotaph has none. It’s the same with the other major monument, the twisted structure of brick and concrete that was once the rotund and rather pompous Hall of Industrial Promotion.

Standing beside the ruins late in the afternoon, I got talking to three of those unfailingly polite Japanese students and asked for a translation. The most fluent of the trio, Noriake Ishizu, read haltingly.

“The first atomic bomb was dropped above this building, 600 metres above. At that time, 200,000 people were killed by the atomic bomb and at the same time…”
He broke off for consultation with his friends. After all else failed, he drew a geometric picture and we realised the next word was ‘radius’.

“Radius of two kilometres was destroyed. This accident was very sad, so that many people in Japan saved a little money and repaired this building as a monument forever.”

As we wandered through the park, past the memorials to children, the statue of a family inscribed simply, ‘Pray’, and the pond of peace and the flame, we came back to the cenotaph. He translated the inscription, less elegantly but just as movingly as the official version.

“We do not repeat again this fault. Please sleep softly and easily, because we really should not repeat this sadness.”

Many of the statues are decked with ‘sembatsuru’, swathes of colourful paper flowers, strung on string like the tail of a kite.
At the children’s monument, the sembatsuru has some cards written in English. ‘War is not healthy for children and other living things. Peace. Shalom.’ That card was from a group of doctors in Okayama.

We talked with an old taxi driver, Hajime Kanmori, who said he rescued people in his truck the day after the bombing; he particularly remembered how the dead had to be burned with kerosene. He came through with strong health, but his fellow truck-driver Zenichi Tateishi was badly burned and fell ill by the ‘bad disease’.

At dawn, dozens of middle-aged and elderly people were doing exercises in the park. There was a burst of martial music and shouted ordered when someone switched on an exercise routine on a tape recorder, waking up a pair of alcoholics on a park bench.

The dome was singularly eerie that morning, with its rubble covered in weeds. I had been reading eyewitness accounts of how the bomb’s radioactivity had germinated weed seeds within days.

“Over everything – up through the wreckage of the city, in gutters, along the riverbanks, tangled among tiles and tin roofing, climbing on charred tree trunks – was a blanket of fresh, vivid, lush, optimistic green. Especially in a circle at the centre, sickly regeneration…”

My third and final visit to the park was at about 10am to see the Atomic Museum. There is a model there of a family wandering in the holocaust, which is sheer horror. But most of the other items seemed fairly clinical, except for a familiar kitchen curtain that was scorched to a uniform brown color.

The final tablet in the museum reads, “So that was how Hiroshima perished in the disastrous explosion. Men and women, young and old. For the souls of the fallen victims let us pray, rest in peace.”

In the visitors’ book, a sailor from, the USS Bonefish had added, ‘Why knock a winner? Go to Hell.’ In similar vein, a Filipino had written: ‘Millions of Filipino soldiers and civilians died too.’ Someone from South Yemen wrote, ‘A sorrowful sight’ and a Latvian wrote, ‘I hope God will forgive us.’

I was especially uneasy that morning because I had requested Ichiro, my Foreign Affairs Department guide, to arrange an interview with someone in the hospital for atomic bomb victims.

This was scheduled for 11.30am but I had no idea how I should do such an interview, had forgotten to buy flowers, and was inwardly wanting to call the whole thing off.

We drove through Hiroshima’s bustling city centre, which has the same frenetic, even manic, exuberance of downtown Tokyo or Osaka, and stopped abruptly outside a dingy building that looked more like a block of old flats.

But the waiting room, with the wooden benches and scattering of old, silent people, was unmistakably hospital-like. We were ushered into a conference room, served iced tea and told about the person we would meet by a cheerful and friendly doctor.

This was useful because the time allotted for the interview was short. Mrs Sato (not her real name) was standing outside the Hiroshima station when the bomb dropped, the doctor said, via Ichiro and above the racket of a commercial broadcasting van that was cruising down the road.

There were terrible scenes and she saw a lot of people fleeting and she followed them. She walked and walked and finally came to a farm where she had her first rest. That was the time she realised how badly she was burnt. Her skin was peeling off and she found that her lips were swollen and injured. She was terribly thirsty and suffering from shock.

Her parents came but could not identify her, so she had to identify herself to them and they took her home to Iakaya-cho where treatment began.

The doctor broke off as Mrs Sata herself was shown in. She was wearing an attractive pink lacy dress with long sleeves and showed no signs of facial scarring. She was somewhat overwhelmed by the occasion, giving deep bows to Ichiro and myself, and laughing in an embarrassed way – behind her hand.

We talked about her family for a while, but at Ichiro’s suggestion came quickly to the point.

“It was a very hot day that day,” she said. “I was going into town under military orders to help clear away demolished houses.

(Hiroshima had been hardly touched by the B29s, but in anticipation of ‘incendiary raids’ housing had been pulled down at right angles to the river to form escape lanes and to localise fires. All able-bodied girls from the secondary schools had been summoned the day before to help the work. About 20,000 of them perished and are commemorated in a memorial in the park.)

“I was standing with classmates outside the station in the open about one kilometre from the epicentre waiting for a streetcar, and quite unprotected by anything. There was a flash ten times or 100 times brighter than lightning in the sky, enough to damage your eyes, it was so bright.”

(The eyes of many people, such as anti-aircraftmen looking directly at the bomb, melted.)

“I instantly lay down on the ground, as we had earlier been told to do if anything menacing happened. I heard no sound. When I raised my head again, after about ten minutes, everything was a very dark grey with suspended ashes, like when you turn an old fire in a stove upside-down.

“I was no sure if I was in the same spot where I lay down. There was no way to tell. But I think I was about 15m from that spot.

“I was hit and burnt from the right side. Because I was a girl I had instinctively protected my face with my arms.

She rolled up a lacy pink sleeve to show the disfiguring. It began on the upper arm where a short sleeve had ended, and was more prominent about the elbow. Her ankle, where her wartime trousers had ended, was also burnt, she said.“Many people were crushed down under wreckage. I got up and followed people who were walking along the railroad. In the river, lots of people were floating. I heard cries for help from people in buildings. Most probably they were crushed down too.

“Finally I reached a primary school that was packed with suffering people, and I saw many people dying in front of me. I lost consciousness.

“Afterwards I did my best to keep my arms as clean as possible, so no germs would cause a deep infection. I did not have any grafts but the doctors had to cut my elbow and stretch it back. The moment any skin formed the doctors peeled it off again so no germs would stay inside. I was fortunate because my parents could look after me. They were living outside Hiroshima.

“Many people in Hiroshima who suffered from radiation and burns don’t like to talk about things. There are so many people nowadays who don’t know anything about what happened then, and they get scared when they see the damage to people.

“I never fail to go to the memorial service every August 6. My classmates all died that day, all 240 of them.

“I am quite confident about the Japanese Government policy for peace. There is no question about it. But if a country tried to attack us from outside, I am not sure what is the right thing to do. There may be some people who would say Japan should stand up and fight back. That is what I am afraid of…but I am not sure. Because of my bitterest experience, I pray that things such as that should not happen. I am very conscious that H-bomb tests are still being conducted and I am worried about it.”

I asked about her attitude to peaceful use of nuclear power. She said it was very hard to judge what ‘peaceful use’ meant in modern conditions, but with that proviso, she did not object to ‘peaceful’ uses.

Our time was up. Mrs Sato had taken time off from her clerical job with a construction firm to meet us. We offered her a lift back but she declined.

She had seemed quite willing to tell her story but at many points I judged she was close to tears.

Next Friday morning at Hiroshima’s Peace Memorial Park, Mayor Takeshi Araki will add to the cenotaph the names of 101 more people who died of radiation diseases in 1975-76.

At 8.15am, the same time that bombardier Tom Ferebee dropped the bomb from the hatch of Enola Gay, two relatives of victims will toll the peace bell to start a one minute’s silence.

We now live in the atomic age. Ask not for whom the bell tolls, it tolls for thee. #

 

Cartel Capers in the Menzies Years

As a conservative, I’m browned off at the growing adulation of Robert Gordon Menzies. It got a kick-along in May on the seventy-fifth anniversary of his 1942 “Forgotten People” speech.

Sure, our four most recent prime ministers, with their cumulative deficits of $400 billion would make a principled Liberal pine for Menzies’s small government, fiscal conservatism and stability. And it seems churlish to disparage a prime minister who presided over 4.1 per cent real annual growth between 1950 to 1965, and a stunning 5.1 per cent real annual growth between 1962 and 1968.[1] But I’ll have a go.

Menzies oversaw the cartelised Australian economy that operated form 1949 to 1966. It continued after Menzies until 1974, when the price-fixers were driven from the temple by Whitlam’s Attorney-General Lionel Murphy. (I’m not of course endorsing Whitlam’s economic management en bloc.)

Menzies praised the thrifty and ambitious family as the driver of progress. But Menzies was complicit in, and actively supported, the price-fixing and market-sharing rings that operated in their multitudes throughout Australia at the expense of that thrifty and ambitious family’s shopping budget.

Menzies fans would say that price-fixing in those days was non-contentious and just part of the long-accepted landscape—what was good for business was good for jobs and progress—and therefore it would therefore be unfair to tar Menzies with the cartel brush. One letter-writer to the Age in the mid-1960s, A.J.E. Gourlay, a fan of the Institute of Public Affairs, put the industry’s case:

Price fixing has come to be an accepted part of our social structure, and is no more morally reprehensible than wage fixing or fixing the price of a hair cut, or the price of electricity.

Some people think it would be very nice for them if there were perpetual cut-throat competition for everything except selling a person’s services; but that is surely a very one-sided proposition.

People who put their life savings into industry are surely entitled to some protection, and a flourishing industry gives secure employment and better conditions to its employees … [2]

Brisbane industry magnate Sir Leon Trout similarly opined that the only sufferers from the price-fixing regime were “a few disgruntled people who wished to buy retail goods at wholesalers’ prices”. [3]

But it’s easy to find moral condemnation of cartels at the time, including from Menzies’s own team such as a future High Court Chief Justice (Garfield Barwick) and a future Liberal Party leader (Billy Snedden). Down near the base of the social pyramid, the June 1957 Victorian State Conference of the Shop Assistants’ Federation passed a motion condemning “the tendency to increase monopoly cartels and price-fixing arrangements as being against the best interests of the working class and in particular the shop assistants”.[4] Low-paid shop workers, who rang up sales for the cartels, were also cartels’ victims. Decades later, in 1971, Labor’s then shadow minister Rex “The Strangler” Connor, not a chap I normally quote approvingly, was describing Australia as “the last frontier for economic banditry” where business was “controlled by every restrictive device known to the ingenuity of man”.[5]

Surprising numbers of otherwise well-informed people—historians included—have no idea how our pre-1974 business sector operated. A credulous reader would (or should) get a jolt to find in Blanche d’Alpuget’s Hawke: The Early Years, on page 247:

The argument that market forces controlled manufacturers was invalid in Australia, for by the 1960s there was a system of monopolies and cartels operating: while free enterprise flourished, free competition was a figment.

She was not exaggerating. In 1967 the competition lawyer J.G. Collinge wrote of restrictive practices and price-fixing that “horizontal agreements directly affect commodities in 52 of the 56 divisions in the Revised Standard International Trade Classification”.[6]

Business’s temptation to price-fix is so strong that even in 2000 to 2004, in the modern era with a $10 million penalty per offence, box-makers Amcor Ltd and Richard Pratt’s Visy, jointly controlling 90 per cent of the market, also production-shared and organised to raise prices. Amcor got immunity by dobbing in Visy, and Visy copped an enormous $36 million fine.

The cartels for price-fixing and restrictive practices originated in the Depression, to ward off price wars generated by over-capacity. During the Second World War the government fixed wages, prices, outputs and zones, and thereafter businesses took over price controls on a private enterprise basis. As the Trade Practices Commissioner, Ron Bannerman’s first annual report put it:

Many companies are as accustomed to identical selling prices as they are to common labour rates and to common or similar prices for the materials they use … Often there is no recent experience of prices competition, occasionally no experience of it at all.

Bannerman told a Perth audience in 1971 that there was more restraint on competition in Australia through restrictive trade practices than in “almost any developed country you can think of”.[7] Even New Zealand brought in anti-cartel measures fifteen years before Australia. Iceland acted sooner than us. So did the UK, Belgium, France, Denmark, Japan, Norway, South Africa, Sweden and West Germany.[8]

Those pre-1974 price-fixes could be elaborate. With frozen vegetables, there was a national agreement among all producers involving fourteen pages of text, twenty-one pages of pricing schedules (each page with about 100 prices), fifteen pages on terms, payments and discounts, and five detailed zoning maps.[9] One prominent trade association included among its imperious rules:

To stabilise prices by controlling and regulating the wholesale and retail prices and terms and conditions of sale generally and to eliminate unreasonable and unfair competition in buying and selling by manufacturers, wholesalers or retailers and to control and regulate supplies.[10]

At late 1974, there were 2721 registered anti-competitive agreements among manufacturers, wholesalers and retailers. There were also 9289 restrictive distribution agreements (including some conglomerates writing deals for each of thousands of their distributors).[11] The registered deals had increased by 3558 since 1968.[12]

As I look around my study, the following items in the Menzies era would have involved pricing cartels: desk and chairs; books; lamps; stationery; hammer and screwdriver; building materials; heater; shoes and clothing items. If nature calls, I’d go to our price-fixed china pedestal (in one year, three of the four makers decided to lift their fixed prices by a whopping 18 per cent) or I’d apply price-fixed toilet paper.

Beyond my study, add smokes; bread; beer; chocolate; biscuits; soft drinks; ham and bacon; wholesale wine and liquor; greeting cards; classified advertising; optical goods; bicycles; sporting ammunition; paint; pressed steel baths; venetian blinds; pharmaceuticals; car parts and windshields; tyres, tubes and retreads; batteries; builders’ hardware; electric cables; ceramic tiles; concrete pipes and roofing tiles; electrical accessories; industrial safety products; welding electrodes …[13]

Here’s a grass-roots case: In 1965 the Franklins sixty-four-store chain in New South Wales mutinied against the machinations of the Chocolate and Confectionary Manufacturers Association. Franklins’ managing director, Norman R. Tieck, revealed that the association had chopped his supplies because he cut prices of chocolate blocks from 2/- to 1/9, still with a comfortable profit. The chocolate cartel was hitting “many thousands of industrial workers and housewives in their daily struggle to make ends meet”, he told the Sydney Morning Herald, perhaps over-stating chocolate as a staple food.[14]

The thousands of restrictive practices were given the government’s blessing of secrecy and provisional legality in 1965, pending public-interest examination at some distant future date. Meanwhile families and customers were none the wiser.

No one knows how much the price fixes hurt the family purse. Bob Hawke claimed in 2002 that one just one facet alone—manufacturers dictating prices to retailers—had cost Australian families “scores of billions of dollars”. A Treasury Round-Up issue (4/2008) referred to the “immense detriment anti-competitive practices caused to the Australian economy”.

In Victoria the Bolte conservative government not merely tolerated price-fixing but in respect of beer, enforced it through the Liquor Control Commission to ensure “a comfortable level of profit”[15]. As did, until 1976, the South Australian Licensing Court. Adelaide, city of churches, was also a bastion of retail price fixing, perhaps because of its small, clubby and long-standing business families. Some habits continued even after 1974. For example, hoteliers traditionally offered discounts on packs of a dozen beers in the run-up to Christmas. A leading hotelier disparaged this at a friendly lunch with three rivals on November 22, 1977. Next thing, the discounts disappeared. The prime mover was later fined $8000. Around the same time Adelaide retailers of name-brand bed linen had the convenience of a circulated price list that delivered a 70 per cent mark-up.[16]

Collusive tendering to authorities, “an elaborate pretence”, was also standard.[17] As Billy Snedden told Parliament, business was “agreeing first, who will win; second, the price; third, the higher ‘cover price’ which the others then tender”. [18] Menzies’s Attorney-General Garfield Barwick cited nineteen suppliers each bidding £27,578/14/2. Authorities were being held up to public mockery, he complained. Alex Hunter, professor of economics at the University of New South Wales, in 1963 estimated that 40 to 70% per cent of shires’ purchasing was hurt by rigged bids, as was 40 to 50 per cent of purchasing by all levels of government.[19]

 

I can insert here some personal stories, before my evidence for Menzies as guardian of the cartels.

Leaving high school in 1958, I became a cadet reporter while a pal got a chemistry cadetship with Midland’s Government Railway Workshops. The Premier, Bert Hawke (uncle of Bob), the same year launched a royal commission into price fixing. Perth had only 500,000 people but hosted no fewer than 111 trade associations, busily fixing prices and assisting with collusive tendering. Business reps made it clear they wanted not free enterprise but literally “private” enterprise, free from public scrutiny and government interference.

 

Q: Can you indicate why you are not in favour of government control and yet are in favour of private control in relation to price fixation?

Business witness: Yes, because firstly, we stand primarily for free enterprise and the voluntary conducting of our affairs without being bound by statute.[20]

 

The companies were exploiting the Railway Workshops by identical tendering on forty-six products, including sleepers, cement, electrical cables, wire, car parts, fuels and toilet rolls.[21]

Bert Hawke’s 1956 Unfair Trading and Profit Control Act was replaced by his Liberal successor David Brand in 1959. Brand banned collusive tenders only if they were “contrary to the public interest”, top penalty being a mere £500.

Around 1960 my young pal’s Midland bosses decided to do battle against the bid-riggers on high-value white undercoat and red paint for wagons. So instead of requesting standard paint, the workshop labs created chemical performance specifications for each paint item, and called for samples from bidders before considering prices. “It busted the cartel apart. We had rival paint manufacturers knocking at our door,” my pal told me.

Soon after, Perth supermarket owner Tom Wardle, branding himself as “Tom the Cheap”, took on the grocery cartel buttressing the profits of the dominant Charlie Carters and Freecorns. Wardle ran his no-frills, high-turnover stores on margins of 10 per cent compared with his rivals’ typical 25 to 30 per cent. His rivals, in cahoots with about twenty key manufacturers, cut off his key supplies, forcing him to truck in goods from other states. He cultivated his “bad boy” image as a stripe-suited felon, and even took out newspaper ads naming companies that denied him supply. When the West Australian refused the ads, he brought out his own free weekly.

His business expanded by 1969 to 185 stores and $200 million turnover in four states. He ran Australia’s third or fourth-biggest grocery chain. He became Perth’s Lord Mayor and was knighted, but went broke in 1977 over property and Swiss low-interest loans. Tom the Cheap’s saga illustrated the huge resources needed to take on the entrenched cartels.[22]

 

In 1971 I joined the Canberra Press Gallery as the Age’s economics writer. One week in March 1972 I did a ring-around of Melbourne local authorities, and was told of the following level-tender rackets: Box Hill Council—concrete pipes; Camberwell—pipes, road metal, petrol; Doncaster—pipes; Essendon—petrol, diesel and power kerosene; Collingwood—petrol; Coburg—petrol, and each make of car requested. The Coburg municipal clerk said he’d complained to Canberra for years.

A chief of a large local authority told me that on electric cabling, nails, bolts and hardware, he would get twenty-five identical bids every time. He had busted one ring by awarding supply to the same bidder every time—it didn’t help him but it hurt the rest of the ring. On another product ring, he read suppliers the riot act. They agreed to cut their price by 10 per cent. But once out the door, they quickly restored the status quo by a 10 per cent price rise. On lamp globes, he said he had split supply nine ways to frustrate the bidders, “although it was hell administratively”.[23]Looking back, I’m mystified that Victoria had an Act (from 1965) banning collusive tendering to government. Maybe local government didn’t count.

In Tasmania, a royal commission in 1965 found the customary web of cartels and collusive tenders. For beer, all hotels had to be members of the Hotels Association to qualify for brewers’ rebates. The association also fixed the retail prices of bottles at hotels. The Royal Commissioner, J. McB. Grant, reported that the Tasmanian retail mark-up on booze was nearly double that in Victoria and New South Wales.[24]

But where was the Labor Party on this issue that degraded the living standards of millions of workers? It was preoccupied with factional squabbles and the lesser issue of monopolies, with an eye to controlling or nationalising them at the first opportunity.

Some unions enforced minimum price fixes of their own. When Sydney supermarkets offered a 5 per cent discount on day-old bread in 1977, the bread delivery unions black-banned 700 stores and shut down half the bread supply to Sydney. To sustain carters’ jobs, bread-makers agreed to sell to retailers at union-specified prices minus 14 per cent, an interesting twist on the staff of life.

The Transport Workers Union in New South Wales in 1975 banned petrol deliveries to stations displaying discount petrol prices. New South Wales motorists had to pay around seventeen cents a litre extra for tanker drivers’ job security.[25]

Bob Hawke, who saw that busting price-fixing could raise workers’ prosperity just as wage rises could, vainly argued this as advocate in late 1960s national wage cases. Then in 1971, as ACTU President, he launched a joint venture with the owner Lionel Revelman of the large Bourkes store, Melbourne. This venture was aimed at busting retail price-fixes demanded by the stores’ Dunlop and other name-brand suppliers. Dunlop refused supply unless Bourkes-ACTU marked up the goods at 42.5 per cent rather than the store’s preferred 22.5 per cent. Twenty other suppliers joined the blockade of Bourkes, including Julius Marlow, Crestknit, Bata and Parker Pens. On March 17, 1971, Hawke organised twelve unions to stop all goods to and from Dunlop companies in Victoria. Two days later Dunlop’s managing director Eric Dunshea capitulated, on orders from his London directors, followed by the others. [26]

The Prime Minister, William McMahon, was caught on the hop. Any support for price-fixers was not a good look with voters. The Liberals had first promised voters more than a decade earlier to break up price rings. Even so, McMahon continued to equivocate:

 

There are many arguments for and against retail price maintenance. A lot of people say they believe in orderly marketing and that orderly marketing is the best way there is of selling goods cheaply in the shops. [27]

 

Whitlam made all McMahon’s plans irrelevant with Labor’s win in December 1972, despite Whitlam’s own cluelessness on matters economic—“The vices of a regulated economy must be replaced with the virtues of a planned economy.”[28]

Meanwhile the Hawke venture was troubled from the outset by union in-fighting. Some unions even urged their members to boycott Bourkes-ACTU because these unions had discount deals with other outlets. The joint venture limped to failure. In 2002 Hawke recalled with pride and some exaggeration about “smashing the collusive practices of big business supported as they always had been by conservative governments. And, as always, the hypocrisy of that unholy alliance stank to high heaven.”

 

It’s time now to narrow the focus to Menzies and the cartels.

I checked an armful of books and lectures on Menzies and his era and found just one discussion (by John Howard) and one mention of the pricing rings that luxuriated in Menzies’s shadow. For example, Allan Martin’s two-volume Robert Menzies: A Life—nothing.[29] Ditto Gerard Henderson’s Menzies’ Child: The Liberal Party of Australia 1944–94—nothing.[30]

Instead, we get the St Robert line. David Kemp writes in last year’s Menzies: The Shaping of Modern Australia:

 

Menzies liberalism was based on a deep faith in the capacities of each human being, in the desirability of “a fierce independence of spirit” and “a brave acceptance of unclouded individual responsibility”. These values would build a better society.

 

Kemp, in praising the Menzies ethos, scores an own goal by quoting Menzies further, from November 24, 1942, apropos of a fair deal for the public. Menzies began, “We must beware of cheap substitutes for the rule of Parliament. We must resist the rule of any sectional body, whether the employers’ association or the trades union.” Kemp’s quote extract follows:

 

There is some tendency today, as there was in the Italy of the early Mussolini, to organise the community by giving to each trade or industry a separate collectivist control of itself through the employers and employees engaged in it …

 

Thousands of employers’ price-fixing and restrictive agreements by the late 1960s weren’t far off what Menzies had decried in 1942.

The C-word  (for cartel) pops up once in that book, in the economic essay by Henry Ergas (ex-OECD) and Jonathan Pincus (Adelaide University). Neither seeming familiar with pre-1974 cartels, they remark that wage moderation, “cartels” and trade protection generated high returns for many producers, and that, reportedly, widespread collusion allowed inefficient firms to survive and efficient ones to earn “supra-normal returns”.[31] That’s all you’ll find in 390 pages, apart from a footnote.[32]

Petro Georgiou’s 1999 lecture in the Menzies Lecture Trust annual series on liberalism is one of a number showing incompatibilities between St Robert and reality. Georgiou held Menzies’s former seat of Kooyong. He said, “Alongside Menzies’ philosophical commitments to enterprise and initiative, to the incentive to prosper and create, was a commitment to social justice. A commitment embracing a better distribution of wealth …” (my emphasis).

Menzies himself remained adept at concealing his hand, generally equivocating about cartels in public utterances. Certainly, federal constitutional powers over cartels were a vexed issue, but Menzies, unlike Barwick, had been content to let sleeping dogs lie. This is from Menzies’s 1951 election stump speech (emphases added):

 

We have, as a nation, pursued a policy of increasing costs by reducing the working week, by restrictive practices, by too much inefficiency, by hot competition in wages, by vastly increased social services. I do not say that these are all bad things; some of them, on the contrary, are very good. But if we want them, we must pay for them …

 

His syntax magically conceals whether price rings are good or bad.

In the run-up years to the 1961 election, Barwick began working up anti-cartel proposals, combining moral and economic justification. By 1960 inflation (4.5 per cent) was a further incentive against price-fixing. The Governor-General Viscount Dunrossil’s parliamentary opening for Menzies in 1960 included—as a second-last sentence afterthought

 

The development of tendencies to monopoly and restrictive practices in commerce and industry has engaged the attention of the Government which will give consideration to legislation to protect and strengthen free enterprise against such a development.

 

What? “Development of tendencies”? As if price-fixing were not already saturating the economy! Economist Alex Hunter at the time estimated there were 600 trade associations at work, two-thirds promoting collusive practices.[33]

In Menzies’s election policy speech on November 15, 1961, his “supplement” on restrictive practices included:

 

It would be most undesirable to have an elaborate system of government controls which restricted true development, efficiency, and enterprise. On the other hand, the public interest must be paramount; exploitation must not occur.

 

Barwick had not yet formed proposals, he said, and when finally cabinet made some decisions, there would be six months for submissions “so that no proper consideration will be overlooked”. Not exactly fighting words against cartels.

In April, Menzies had written to his family:

 

But the men who have under my Government enjoyed unexampled prosperity for ten years and have become accustomed to high incomes and a minimum of competition, are the first to complain if they find their profits and dividends declining even by a fraction. [emphasis added][34]

 

Note that Menzies is complaining about big-business owners’ ingratitude: he was not showing any principled concern about their officially-sponsored feather-bedding. (Buttressing the cartels were effective import protection rates for manufacturing in the late 1960s of 61 per cent for metal products; 52 per cent for paper and printing; and overall 36 per cent).[35]

Still, Barwick’s 1962 proposals were the high point for the Liberals in (hypothetical) anti-cartel severity. That lawyer’s draft even cracked down on fixed fees for lawyers. But the proposals met plenty of internal opposition. As the SMH’s political correspondent wrote, “There is a lot of doubt whether the Prime Minister was really convinced either of [Barwick’s plan’s] political wisdom or necessity …”[36] It was another five years—and one year after Menzies retired—before the public got even token government protection from cartels.

A mysterious anti-cartel speech was delivered in 1962 by backbencher Billy Snedden, the future Liberal leader. He was morally outraged about what he called the multitudinous, harmful and untenable cartels victimising the “defenceless public” through “virulent and obstructive practice”. He seemed to hint at a revolt by a ginger-group of Liberals if government inaction continued.

Of restrictive practices, Snedden said that “the refinements are as exotic as the fire from a cut diamond”. Fixes were disguised as “orderly marketing” or a “code of ethics”:

 

They raise prices; they restrict production; they boycott people out of business; they prevent others from competing; they concentrate economic power improperly; and they care not for the public interest …

… agreements by one group beget similar and usually intertwined agreements by other groups in the distributive process. In its worst form it fixes prices much higher than they need be. In the lesser form it fixes prices to allow a comfortable margin of profit without the risk of a loss.

 

Sanctions by the cartels—fines and expulsions—could drive transgressors out of business through denial of supply or refusal to stock the products.

 

Businesses divide into groups, each group interlocking with others to enhance the power of collective boycotts, and sharing of market and conditions of sale …

 

He warned that if the Barwick scheme was not rapidly implemented, the Liberals faced the threat of wilder, ignorant legislation by a Labor government criminalising business people with new laws “absolute in terms and extreme in penalty”. “Not only does the public want it [Barwick’s scheme] but the nation must have it,” Snedden said.[37] There was no love lost between Snedden and Menzies, who later described Snedden as “a good junior but a hopeless leader”.[38]

John Howard in his book The Menzies Era provides his own revealing take on Menzies’s distaste for his own government’s anti-cartel push. Howard, who in the early 1960s was a mere Liberal apparatchik, writes that Barwick’s anti-cartel proposals:

 

had a rough time, with Menzies ultimately stepping in, in response to business concerns that the plan was too interventionist … All of the major organisations reacted badly to Barwick’s proposals. Menzies was specially sensitive to the opposition of the Victorian Chamber of Manufactures, which had been highly critical of the Coalition in the 1961 election campaign … By the middle of 1963 the final shape of the legislation was still unresolved … Menzies publicly hinted at major changes, saying the tabled proposals “were by no means the last word” and promised a second look at the “sweeping, clumsy and autocratic plans of the Attorney-General”.[39]

 

Did Menzies really describe Barwick’s plan as “sweeping, clumsy and autocratic”? Howard gives no source. It would be incredibly disloyal and inflammatory of Menzies towards his eminent cabinet colleague. Regardless, Howard makes no bones about Menzies undermining Barwick’s efforts.

Menzies also had kind words for the conspirators of the New South Wales Chamber of Manufactures. Opposition Leader Arthur Calwell charged that Menzies had repudiated Barwick when addressing industry chiefs at a Chamber dinner in September 1963.[40] Menzies said their submissions were “the most balanced, sensible and impressive ideas” he had heard. Calwell’s translation of Menzies: “Let Little Gar have his fun, but don’t worry, Uncle Bob will fix it, boys!”

Barwick left politics for the High Court in April 1964, and the tatters of his anti-cartel proposals, after scores of debilitating amendments, were brought in next year. Cartels were given a further two years’ grace and then restrictive practices were merely subjected to registration and prolonged case-by-case examination—except for collusive tendering, which was banned.

Menzies retired, trailing his clouds of glory, in 1966. There are many reasons to praise Menzies’s policies and achievements. But please don’t bang on about his concern for thrifty and ambitious families. He didn’t care if business combinations—economic bandits—exploited them mercilessly.

Tony Thomas was Economics Writer for the Age in Canberra from 1971 to 1979, and wrote for BRW Magazine from 1981 to 2001.


[1] J.R. Nethercote (Editor). MENZIES -The Shaping of Modern Australia. Connor Court Publishing, 2016. p135-6

 

[2] Age 10/9/65, p2

 

[3] Age 17/7/65 p5

 

[4] AGE June 24. 1957 p7

[5] Restrictive Trade Practices Bill 1971, Second Reading debate from Nov 25.

 

[6] Australian Trade Practices: Readings. Ed JP Nieuwenhuysen, Croom Helm, London, 1976, p75

 

[7] SMH 2/4/71

[8] Billy Snedden, Hansard 16/8/62 p422

[9] Pengilley, Warren: Collusion – Trade Practices and Risk Taking. CCH, North Ryde 1978, p51.

 

[10] Pengilley, Warren: Collusion – Trade Practices and Risk-Taking. CCH Australia, North Ryde, 1978, p28

 

[11]

Trade Practices Commission, First Annual Report, 1974-75, p65

[12] JP Nieuwenhuysenm and NR Norman, Australian Competition and Prices Policy, Croom Helm, London, 1976 p19

[13] Sources: Miscellaneous including Royal Commissions, CTP annual reports, court cases, press reports.

 

[14] SMH 15/10/65 p34

 

[15] Review of the Liquor Control Act 1968, Vol 2, p684

[16] Round, DK and Siegfried, JJ. Horizontal Price Agreements in Australian Antitrust. Review of Industrial Organization, Vol. 9, No. 5, 10/1994, pp 569-606

[17] CTP second annual report, p8

[18] Hansard, 16/8/62, p424

[19] SMH, 18/2/63 p2

 

[20] Karmel PH and Brunt, Maureen: The Structure of the Australian Economy. Cheshire, Melbourne, 1962, p95

[21] Australian Trade Practices: Readings. Ed JP Nieuwenhuysen, Croom Helm, London, 1976, p176

 

[22] Westralian Portraits, ed Lyall Hunt. UWA Press, Perth 1979 pp287-95

[23] Age 10/3/72.

[24] Australian Trade Practices: Readings. Ed JP Nieuwenhuysen, Croom Helm, London, 1976, p31

[25] Tony Thomas, Age 28/4/1977 p21.

 

[26] Age 20/3/71, SMH 19/3/71, D’Alpuget, Blanche, Hawke: the Early Years, p277-86

 

[27] Age 1/4/71

 

[28] Age 26/11/65 p3

 

[29] Martin AW, Robert Menzies, A Life. Carlton, Vic. : Melbourne University Press, 1993/1999.

[30] Henderson, Gerard: Menzies’ Child- The Liberal Party of Australia. Harper Collins, Sydney, 1994

[31] J.R. Nethercote (Editor). MENZIES -The Shaping of Modern Australia. Connor Court Publishing, 2016. p152 and 158.

[32] Economist and regulation specialist Dr Alan Moran argues that cartels are not important in explaining inefficiency since they tend to implode from their internal tensions or can be undermined by new competitors. But cartels aided and enforced by government (e.g. the former two-airline policy) can have persistent harmful effects. Moran says that despite import protection, there is no evidence of super profits being earned, possibly because gains were leached off to organised labor. (Interview, 4/6/17)

[33] Australian Trade Practices: Readings. Ed JP Nieuwenhuysen, Croom Helm, London, 1976, p177

 

[34] Robert Menzies A Life. Vol 2 1944-1978. A W Martin, MUP 1999, p432

 

[35] Industries Assistance Commission, 1976, Assistance to Manufacturing Industries. AGPS Canberra.

[36] SMH 30/10/62

 

[37] Hansard, 16/8/62, p421-4

 

[38] Henderson, Gerard: Menzies’ Child- The Liberal Party of Australia. Harper Collins, Sydney, 1994 P186

[39] Howard, John, The Menzies Era. Harper Collins, Sydney 2014, p276

 

[40] SMH 17/9/63, p4

The Trump Doctrine on Energy

If you go by the mainstream media’s lockstep ‘coverage’ of the US president’s first six months, he is no more nor less than a tweeting buffoon. A comforting narrative for cant-addicted newsroom hacks and groupthinkers, it handily avoids any and all mooting of Australia’s need to follow his lead

blackout state IIIOur federal and state politicians scuttle about looking for innovative new ways to strangle the Australian energy sector. But across the Pacific, America is unleashing a world-changing energy revolution. The world’s energy fundamentals are in transition. Donald Trump is liberating American coal, gas, oil and nuclear industries from eight years of Obama’s harassment and restrictions.

The consequences for us as a player in energyexport markets are dire. In an officially supportive environment, Australian energy could hold its share – intrinsically, it has  global competitiveness. But politics here involves ‘renewables’ targets and other sacrifices to please the climate gods,  bans  such as Victoria’s on normal and fracked gas exploration, official and green lawfare against every new energy project (think Adani), impromptu Turnbull restrictions on LNG exports, Sargasso seas of red tape, and  on-going fatwas against nuclear proposals.

Domestically, American industry will enjoy cheap energy inputs, while our own industry’s  energy becomes as expensive as anywhere in the world. This disparity will play out in Australian factory closures and capital flight to the US.

A banana republic couldn’t do a better job of destroying its own wealth.

The US is now estimated to have 20% more oil than the Saudis – at USD50 a barrel, a storehouse of USD $13 trillion. The US has been a net energy importer since 1953, but thanks to fracking is now likely to be a net exporter as early as 2020. American LNG could move into net export surplus as early as this year. By 2040, US natural gas exports alone could bring in USD $1.6 trillion, and generate USD $110b in wages. US gas reserves are also enough to meet domestic needs for a century. The American energy revolution – in Trump’s word, “dominance” –  seldom makes the mainstream media here, which is fixated on the schoolyard narrative of Trump as a tweeting buffoon.

Want to know what’s really important? Trump on June 29 addressed the Department of Energy’s“Unleashing Energy” conference in Washington.

His policy announcements were so shattering to the green/left ideology – he talked of “clean, beautiful coal” for example – that his message went almost unreported here. Trump said

The golden era of American energy is now underway.  When it comes to the future of America’s energy needs, we will find it, we will dream it, and we will build it.

American energy will power our ships, our planes and our cities.  American hands will bend the steel and pour the concrete that brings this energy into our homes and that exports this incredible, newfound energy all around the world. And American grit will ensure that what we dream, and what we build, will truly be second to none.

Today, I am proudly announcing six brand-new initiatives to propel this new era of American energy dominance.  

First, we will begin to revive and expand our nuclear energy sector   which produces clean, renewable and emissions-free energy.  A complete review of U.S. nuclear energy policy will help us find new ways to revitalize this crucial energy resource.  [US nuclear plants have been shuttering because of cheap gas and low power demand].

Second, the Department of the Treasury will address barriers to the financing of highly efficient, overseas coal energy plants.  Ukraine already tells us they need millions and millions of metric tons right now.  There are many other places that need it, too.  And we want to sell it to them, and to everyone else all over the globe who need it. [Geo-strategically, US coal and LNG could weaken Russian energy hegemony in Europe. Cheniere Energy  has just delivered the first U.S. cargoes of LNG to Poland and the Netherlands].

Third, my administration has just approved the construction of a new petroleum pipeline to Mexico, which will further boost American energy exports. [This New Burgos Pipeline will deliver up to 180,000 barrels a day. The US is Mexico’s main petroleum supplier.]

Fourth, just today, a major U.S. company, Sempra Energy, signed an agreement to begin negotiations for the sale of more American natural gas to South Korea.

Fifth, the United States Department of Energy is announcing today that it will approve two long-term applications to export additional natural gas from the Lake Charles LNG terminal in Louisiana.  It’s going to be a big deal.  [Currently the US exports LNG only through Sabine Pass, Louisiana, but four other terminals should come on line between 2018 and 2020, competing with Australia, Qatar and Russia].

Finally, to unlock more energy from the 94 percent of offshore land closed to development, we’re opening it up, the right areas. Under the previous administration, so much of our land was closed to development.   – we’re creating a new offshore oil and gas leasing program.  America will be allowed to access the vast energy wealth located right off our shores.  And this is all just the beginning — believe me.

Is Trump merely rhapsodising? No way. His energy track record in his first half-year — again, carefully ignored by Australia’s mainstream media — speaks for itself.

  • The Environmental Protection Agency was ordered to dump Obama’s “Clean Power Plan” designed to bump up household electricity rates by 14%
  • The long-frustrated Keystone pipeline from Alberta to Illinois/Texas got fast-tracked approval
  • Obama’s ban on new coal leasing on federal land was revoked  – these lands involve 40% of US coal production.
  • The US has dumped its Paris Climate commitments, which Trump says will save taxpayers USD3 trillion, and protect 6.5m US industrial jobs. “Maybe we’ll be back into it someday, but it will be on better terms,” he said last week
  • Hundreds of thousands of hours of red-tape energy regulations – including on fracking –  were abolished.

Trump spelt out his energy philosophy. “With [our] incredible resources, my administration will seek not only American energy independence that we’ve been looking for so long, but American energy dominance.

“And we’re going to be an exporter — exporter!” he promised. “We will export American energy all over the world, all around the globe.  These energy exports will create countless jobs for our people, and provide true energy security to our friends, partners, and allies all across the globe.”

Unlocking energy would generate millions of jobs and trillions in wealth, he said.  For over 40 years, America was vulnerable to foreign regimes using energy as an economic weapon. Americans’ quality of life was diminished by the idea that energy resources were scarce.

 Many of us remember the long gas lines and the constant claims that the world was running out of oil and natural gas.    

Americans were told that our nation could only solve this energy crisis by imposing draconian restrictions on energy production.  But we now know that was all a big, beautiful myth.  It was fake.   The truth is that we have near-limitless supplies of energy in our country.  Powered by new innovation and technology, we are now on the cusp of a true energy revolution.

We have nearly 100 years’ worth of natural gas and more than 250 years’ worth of clean, beautiful coal.  We are a top producer of petroleum and the number-one producer of natural gas.  We don’t want to let other countries take away our sovereignty and tell us what to do and how to do it.  That’s not going to happen.  

But this full potential can only be realized when government promotes energy development instead of obstructing it like the Democrats.   We have to get out and do our job better and faster than anybody in the world.  This vast energy wealth does not belong to the government.  It belongs to the people of the United States of America.   Yet, for the past eight years, the federal government imposed massive job-killing barriers to American energy development.

Job-killing [Obama] regulations are being removed. I’m dramatically reducing restrictions on the development of natural gas.  I cancelled the moratorium on a new coal leasing on federal lands.  

We have finally ended the war on coal.  And I am proud to report that Corsa Coal  just opened a brand-new coal mine in the state of Pennsylvania, the first one in many, many, many years

We’re ending intrusive EPA regulations that kill jobs, hurt family farmers and ranchers, and raise the price of energy so quickly and so substantially.

From all this are two take-home messages: in the US, you ain’t seen nothing yet. And for Australia, we can either change tack on energy madness or fall under the wheels of the US juggernaut.

Tony Thomas’s book of essays, “That’s Debatable – 60 Years in Print” is available here.

 

COMMENTS [8]

  1. Bushranger71

    See this well-reasoned argument from a ‘Greenie’ that is supportive of clean coal derived energy:

    http://www.zerohedge.com/news/2017-07-02/next-financial-crisis-not-far-away

  2. Bill Martin

    This article, particularly the quotations from Trump’s speech, read like an enthusiastic song of praise to sanity. That, of course, makes it an anathema for the insane.

  3. en passant

    Trump has set out the winning agenda for any Australian political party that adopts it.

    Do not worry about the screaming trolls and the MacBot sea level rise fakery, just get on with exploiting our wealth while we are still a sovereign nation.

    Oh, and how effective are the violent screaming trolls at winning elections by shouting everyone else down? Just ask Whitlam.

  4. Ian MacDougall

    First, we will begin to revive and expand our nuclear energy sector which produces clean, renewable and emissions-free energy.

    Nuclear energy is finite. (We have not got up to controlled fusion, though there are some promising signs. Its fuel would essentially be sea water, and we are not likely to run short of that anytime soon.) But fission fuel is still not ‘renewable’, and is only ‘clean’ if one disregards the problem of how to dispose of the highly radioactive waste.
    Moreover, ‘emissions-free’ only has importance if one concedes that there is a problem with emissions in non-nuclear, conventional coal sources. But Trump as a fully paid-up member of the Ostrich School of Climatology, denies that anyway.

    He obviously needs a new speechwriter or supervisor. From Trump’s point of view, the existing staff leave something to be desired.

  5. Doc S

    You’re dead right about the almost total lack of reporting on this in the US (and thus the Australian media). A recent media monitoring centre analysis of broadcasting content in one news cycle recorded nearly 350 broadcast minutes on Trump and the Russia investigation – the next was terrorism at less than 15 minutes but every other theme of vital interest to your average American such as healthcare, education, and yes climate change (not forgetting Trump had just withdrawn from the Paris Accords) all got less than five minutes of broadcast time. Its insane. And our media here are not much better. Landmark events like Trump’s DoE address barely rate. Of course Trump realises energy security is the key to prosperity – cheaper and reliable sources of energy will be key to driving the US economy. The Finkel Review encapsulates our government’s view on energy security but is light years away from the American position under Trump (that is happening NOW) and of course not forgetting this all goes against the current climate warming narrative so beloved of the kool-aid drinkers of all political stripes including the Turnbull government. As for the ultimate clean energy – nuclear – well you can just forget about THAT sunshine!

  6. Ken

    Trump is playing the media for the suckers that they are. They spend too much time looking for nasty things to say about him and fail to see just what he has already achieved. Thinking people are enjoying the reactions of ” true believers”.

  7. Keith Kennelly

    An Aussie PM that dumps renewables and subsidies to renewables, promotes coal and gas would turn around the economy and would be PM for ever.

    Tony Abbott should replaceMalvolmTurnbull right now.

Surely Your’re Crying, Mr Feynman

June 28th 2017 print

Back in 1974, the US physicist and polymath warned graduating students of ‘cargo cult science’ and the careerist urge to confirm the flawed orthodoxy of earlier and inaccurate results. Climate “science” was then in its infancy but the trajectory of its corruption has confirmed all his worst fears

feynmanThe trouble with mainstream climate scientists is that they’re third-rate scientists, and the reason they’re third-rate is that they’re dishonest. My authority for this statement is physicist Richard Feynman (picturd), who has been dead for 29 years but was ranked by  his peers as one of the ten greatest  physicists of all time. Feynman set out the parameters for honest science in general, and I’ve never yet seen a mainstream climate scientist live up to Feynman’s honesty test.

In 2015 I was transiting through Los Angeles airport and killing time in a bookshop.  I bought Feynman’s paperback   Surely You’re Joking, Mr Feynman! because it seemed unusual for physicists to take pride in being funny.

In the book’s first essay he tells how, as a small kid, he earned pocket-money repairing people’s radios. A customer would tell him about a fault, and that would be enough to diagnose the problem without even turning on the set.

The book’s final essay – in between there’s wonderful entertainment – is called “Cargo Cult Science”. It’s  the commencement address he gave to freshers at Caltech in 1974. The original cargo cults, as you probably know, involved post-war tribesmen in PNG building mock airstrips and control towers in the hope that this would attract US cargo planes to again deliver their cargoes of desirable goods. “They follow all the apparent precepts and forms of scientific investigation, but they’re missing something essential, because the planes don’t land,” Feynman told the students. He went on to talk about what is missing in bad science – honesty.

 

It’s a kind of scientific integrity, a principle of scientific thought that corresponds to a kind of utter honesty—a kind of leaning over backwards.  For example, if you’re doing an experiment, you should report everything that you think might make it invalid—not only what you think is right about it: other causes that could possibly explain your results; and things you thought of that you’ve eliminated by some other experiment, and how they worked—to make sure the other fellow can tell they have been eliminated.

“Details that could throw doubt on your interpretation must be given, if you know them.  You must do the best you can—if you know anything at all wrong, or possibly wrong—to explain it.  If you make a theory, for example, and advertise it, or put it out, then you must also put down all the facts that disagree with it, as well as those that agree with it.  There is also a more subtle problem.  When you have put a lot of ideas together to make an elaborate theory, you want to make sure, when explaining what it fits, that those things it fits are not just the things that gave you the idea for the theory; but that the finished theory makes something else come out right, in addition.

“In summary, the idea is to try to give all of the information to help others to judge the value of your contribution; not just the information that leads to judgment in one particular direction or another.

“We’ve learned from experience that the truth will out.  Other experimenters will repeat your experiment and find out whether you were wrong or right. [Climate science is intrinsically not experimental but its modelling can now be checked against reality].  Nature’s phenomena will agree or they’ll disagree with your theory.  And, although you may gain some temporary fame and excitement, you will not gain a good reputation as a scientist if you haven’t tried to be very careful in this kind of work.  And it’s this type of integrity, this kind of care not to fool yourself, that is missing to a large extent in much of the research in Cargo Cult Science.

“The first principle is that you must not fool yourself—and you are the easiest person to fool.  So you have to be very careful about that.  After you’ve not fooled yourself, it’s easy not to fool other scientists.  You just have to be honest in a conventional way after that.

“I would like to add something that’s not essential to the science, but something I kind of believe, which is that you should not fool the layman when you’re talking as a scientist…I’m talking about a specific, extra type of integrity that is not lying, but bending over backwards to show how you’re maybe wrong, that you ought to do when acting as a scientist.  And this is our responsibility as scientists, certainly to other scientists, and I think to laymen.

“For example, I was a little surprised when I was talking to a friend who was going to go on the radio.  He does work on cosmology and astronomy, and he wondered how he would explain what the applications of this work were.  ‘Well,’ I said, ‘there aren’t any.’  He said, ‘Yes, but then we won’t get support for more research of this kind.’  I think that’s kind of dishonest.  If you’re representing yourself as a scientist, then you should explain to the layman what you’re doing—and if they don’t want to support you under those circumstances, then that’s their decision.

“One example of the principle is this: If you’ve made up your mind to test a theory, or you want to explain some idea, you should always decide to publish it whichever way it comes out.  If we only publish results of a certain kind, we can make the argument look good.  We must publish both kinds of result.

“I say that’s also important in giving certain types of government advice. Supposing a senator asked you for advice about whether drilling a hole should be done in his state; and you decide it would be better in some other state.  If you don’t publish such a result, it seems to me you’re not giving scientific advice.  You’re being used.  If your answer happens to come out in the direction the government or the politicians like, they can use it as an argument in their favor; if it comes out the other way, they don’t publish it at all.  That’s not giving scientific advice.

“So I wish to you the good luck to be somewhere where you are free to maintain the kind of integrity I have described, and where you do not feel forced by a need to maintain your position in the organization, or financial support, or so on, to lose your integrity.  May you have that freedom. [The following para is in the original but not in the book] May I also give you one last bit of advice: Never say that you’ll give a talk unless you know clearly what you’re going to talk about and more or less what you’re going to say.”

What is fascinating about his common-sense tenets of scientific honesty is that today they are forgotten, ignored, corrupted and trampled upon by supposed scientists  in all fields playing ‘publish or perish’ and ‘get that grant’.  The climate scientists are particularly bad because the stakes in grants, influence and reputation are now so high. When the Climate Council’s CEO Amanda McKenzie talks about “carbon pollution”, why don’t the scientists on her board (Flannery, Hughes, Steffen, Bambrick) correct her and say carbon dioxide (not “carbon”) is  a plant food essential to life on earth, not “pollution”?  That’s what Feynman surely would want.

There must now be tens of thousands of peer reviewed mainstream studies relying on the output of temperature computer-modelling for the Intergovernmental Panel on Climate Change. Since the 5th IPCC report of 2013, each such study, on Feynman’s honesty test, should include in the preamble that the   5th report noted [1] that 111 of 114 such model runs over-estimated actual temperatures from 1998-2012  — and they’re still over-estimating for 2012-2016, as demonstrated by John Christy’s satellite graphs provide in Congressional testimony last March.

A minor negative example: a month ago ABC radio, print and TV was running hot with “coastal koala extinction” stories. Koalas are good talent and we all love these cute little beasties. We learn that, according to the most conservative climate modelling, seas will rise lots and lots between now and 2067 and 2117,  and this will kill the gum trees that many koala populations  feed on – putting them on  “a steady downward run to extinction”.

The tale emanates from research done at the Port Macquarie City Council. It doesn’t seem to have made the published science literature but there is an account of it at a national koala conference at Port Macquarie last month. This account makes no mention of the damning 111/114 fail rate of the main IPCC climate models, and thus it violates Feynman’s integrity test.[2]

Another great Feynman-test fail   is all this science-y stuff about hottest year ever. Surface based records (that have been ruthlessly adjusted by lowering the early-year temperature data) may show recent hottest years, but the 38-year satellite records don’t – at best the 2016 peak was within the margin of error relative to 2015. How can any honest scientist (on Feynman’s definition) fail to mention the awkward satellite data when assessing hottest years? There was even the case in 2015 where NASA put out a press release saying that 2014 was the hottest year since 1880. But within days it had to own up that because of data margins of error, there was only a 38% chance that its ‘hottest year’ tale was valid. Would Feynman say that NASA has scientific integrity? No, I don’t think so.[3]

In my reading on climate over the past decade,  I’ve never seen Feynman’s prescription about honest science referred to in mainstream climate literature. It’s easy to imagine why.

Tony Thomas’s book of essays, That’s Debatable  – 60 years in print is available here


[1] Chapter 9, text box 9.2, page 769. And why was this crucial information not included in the all-important Summary for Policy-Makers?

[2] Another Feynman-style koala check not mentioned would be the nearest tide gauges, to see how much these seas have risen to date. Port Macquarie gauges only go back 30 years and show a 7.8cm rise, i.e. if extrapolated, about one foot per century. Fort Denison in Sydney Harbor shows a mere 6.5cm per century rise based on 128 years of data.

[3] On checking, I find he’d already written off NASA management as scientific frauds.  “NASA managers claimed that there was a 1 in 100,000 chance of a catastrophic failure aboard the [Challenger] shuttle, but Feynman discovered that NASA’s own engineers estimated the chance of a catastrophe at closer to 1 in 200. He concluded that NASA management’s estimate of the reliability of the space shuttle was unrealistic, and he was particularly angered that NASA used it to recruit Christa McAuliffe [lost in the explosion] into the Teacher-in-Space program. He warned in his appendix to the commission’s report (which was included only after he threatened not to sign the report), “For a successful technology, reality must take precedence over public relations, for nature cannot be fooled.”