A light on the hill the Labor Party prefers to leave off

Today’s guest blog, while I am away, is from Victor Quirk who has been tracing some early modern monetary resonances (from the 1930s). He argues that this month (September) marks the 90th anniversary of one of the proudest episodes in the history of the Australian Labor Party (the current Federal government), but one that, he ventures, will not be acknowledged by the present owners of the ALP franchise. It involved the first serious attempt by an Australian Government to establish full employment, the celebration of which would only serve to highlight the distance to which the ALP has moved from serving the interests of working people. I will be back writing tomorrow.

Back in September 1919, E.G. Theodore, Treasurer and Minister for Public Works in the Labor Government of T.J. Ryan, steered The Unemployed Workers Bill through the Queensland Legislative Assembly, a Bill to establish full employment in Queensland. It provided for a high-powered consultative council with resources and authority to commission research, obtain data, design labour market interventions, and order their implementation; it established three forms of job creation:

• Large scale developmental works by the Queensland government (roads, rail, ports, etc) to add to the overall pool of jobs.
• Ordering the expediting or delaying of public works by local authorities to offset seasonal peaks and troughs in labour demand (given the large agricultural sector).
• Where public job creation was insufficient, private employers with more than 15% profit (and £10,000 profit) could be offered the choice of either employing a number of additional people themselves or purchasing State Government debentures to provide the government the funds to employ them itself.

Though aiming to eliminate unemployment, it included a non-contributory work-tested unemployment benefit to cover people while work was being found or created for them, sheltered employment for the disabled, railway passes for workers to travel to jobs, and regulations preventing job ads that exaggerated the amount of work available in a region, to stop a common practice of creating a glut of workers in to drive down the local price of labour. Some of this was to be funded by charging all employers with more than 5 workers, a fee of £2 per person per year, with a £1 rebate for each worker that remained employed all year.

At the core of the Bill lay an explicit commitment to the ‘right to work’, a now forgotten principle of Britain’s Independent Labour Party and the early Australian Labor Party, a principle once championed alongside the ‘eight hour day’. It simply meant that the government had a responsibility to provide dignified work to people when they were unemployed, and thereby eliminate unemployment as a weapon with which employers threatened workers to make them work hard and cheap.

The commitment to this principle by the Labor members of parliament who spoke in support of this Bill makes for refreshing reading for those of us who have waited thirty years to hear contemporary Labor representatives make the same statements. For example, a Labor member by the name of Kirwin, speaking on the 10th of September 1919 asked:

There is just one other matter with regard to the right to work. If it is considered to be the duty of all men to work, and I think it is generally accepted by all men, irrespective of their political views – if it is their duty to work, why has not some method been established to provide the right to work?

The Bill provoked an unprecedented employer mobilisation, and was vilified in the mainstream press as the ‘Loafer’s Paradise Bill’, without any explanation as to how people were encouraged to ‘loaf’ by offering them work. Employers and their parliamentary mouthpieces all said they shared the government’s desire to ‘solve the unemployment problem’, but that such a Bill was the wrong way to address the problem.

They never said they shared a desire for full employment. Instead, they argued for a contributory unemployment insurance scheme, along the lines of that which Winston Churchill and William Beveridge had implemented in Britain 8 years earlier.

This provided a degree of security to skilled workers who had regular work, and hence were able to make regular contributions (that were matched by employers and government), but did nothing for the bulk of workers who were subject to lengthy spells of unemployment, whose entitlement would be quickly exhausted.

Churchill devised this policy to counter a growing ‘right to work’ campaign in Britain, led by James Keir-Hardie, which argued for the elimination of unemployment through large scale public sector job creation.

Churchill’s policy took the heat out of the unemployment debate by showing the Government doing something to help the unemployed worker, while taking care to preserve the unemployment that kept most workers in a state of insecurity and subordination.

Mr. Kirwan , the Member of the Queensland Legislative Assembly who I quoted above, went on to make the point that many people were asking the same question as he about the injustice of not acknowledging the right to work:

This question is not only agitating the mind of the Secretary for Public Works [meaning Theodore] and those who sit behind him, but we find the leading writers in different parts of the world are discussing this particular question. A writer in the ‘New Statesman,’ for June, 1919, deals with the question in this way –

“But the point we wish to emphasise is that the rich have the power to be idle, and that the politics of the privileged classes have, in the past, been concerned to a far greater extent with defending the rich man’s right to be idle than with establishing the poor man’s right to work. The poor man’s right to work has never been admitted by society; the rich man’s right to be idle has. The only excuse for the continued recurrence of periods of unemployment is that no solution could be found that did not interfere with private enterprise, and private enterprise simply means competition for the right to be idle. The State, it was supposed, could do nothing except at the expense of the leisure of the leisured classes. And this the leisured classes declared to be the ruin of society. As nobody wants to ruin society, we have thought it better to do nothing at all.”

Theodore himself was a remarkably perspicacious and eloquent debater: self-educated from the age of 12, Treasurer of Queensland at 31. Faced with objections to almost every clause in the Bill, he became exasperated with the cant of the opposition and their mantra of ‘we share your desire to solve the unemployment problem’ as they moved a motion to block the Bill:

It seems to me, judging by the speeches this afternoon and the speeches made last night in Committee, that honourable members do not desire to solve the problem. They are satisfied to uphold and carry out capitalistic desires in regard to the existence of a reserve army of labour. The capitalists, as a body, are opposed to this Bill. Hon. Members say that it is condemned throughout the country. So it is – by the capitalists. They do not want to solve the unemployment problem. They want a large reserve army of labour from which they can draw in order that they will have more docile employees than they would otherwise have (QPD, 18/9/1919:844).

He elsewhere quoted from ‘Pro and Con’, by J.B. Askew, which set out the standard reasons for opposing full employment:

It is a law of nature that some should fall out of the ranks in the struggle for existence. The State, therefore, should not attempt to deal with the problem, which lies in the nature of things, and which it can never solve. The problem of unemployment is not to do away with it (for a reserve of idle labour is an essential element in the industrial system), but to lessen it as far as possible, and to see that the unemployed workman does not deteriorate during the period of unemployment more than need be. If the State should intervene to supply work for the workless, until could once more find a footing on the industrial ladder, it would tend to undermine those qualities of self-help upon which alone a healthy body politic can stand”

In the end the unelected upper house blocked the Unemployed Workers Bill, so the following year Theodore swamped it with Labor appointees. They passed several controversial Bills that had previously been rejected, but when the Unemployed Workers Bill was reintroduced, in an unprecedented move, the Opposition prevented a quorum by all leaving the Legislative Council chamber.

Two years later the Labor MLCs voted the Queensland upper house out of existence. The Unemployed Workers Bill was never implemented, however, because the money masters of the City of London, to which the Dominion governments then regularly turned for loan funds, placed a financial embargo on Theodore’s government that lasted four years.

Other historians say the blockade was in retaliation for a Bill increasing pastoral rents on crown land, which also attracted fierce opposition. Theodore explained after the blockade was over, however, that it was not because of pastoral rent rises, but because his government had been spuriously perceived as ‘Bolshevik’.

The evidence suggests that London got this idea from the opponents of the unemployed workers bill. A Nationalist (pro-employer party) member named McCartney, responded to Theodore’s accusation that they wanted to preserve a ‘reserve army’ of unemployed:

We have to approach this Bill from the point of view of the party which introduces it, having regard to their platform – a platform that goes for the abolition of the wages system, for the destruction of private enterprise, with a view to putting in its place State enterprise; a policy which is openly admitted, and is not denied except when the Premier sometimes suggests that it is not wise to point these things out for fear the public may take alarm … it seems to me the Bill is so framed as to be capable of being made a machine for the complete annihilation and destruction of private enterprise, even if it is only entered upon by degrees. That is the point of view to look at it from (QPD, 18/9/1919:837).

Of course, after full employment was established 25 years later by the Curtin/Chifley Federal Labor administration of WWII, it was subsequently maintained for thirty years (mostly for fear of the electoral consequences of not doing so) by Liberal governments, and for the most part by the staunchly anti-Communist Sir Robert Menzies (as, by the way, was Theodore). The association of full employment with communism, that underpinned its opposition before the war, was thus no longer plausible after the war.

But in the 1970s, a campaign was hatched by the OECD to abandon full employment around the world, which was championed in Australia by the Chairman of BHP, Sir Colin Syme. The OPEC oil shock of 1973 provided a smokescreen for governments around the world to slash public sector employment so it no longer sufficiently augmented the private sector to preserve full employment.

A large proportion of the willing labour supply has been left unutilised ever since, by way of labour force marginalisation, unemployment and underemployment. While shunning all but the most temporary and modest forms of direct job creation, successive Labor and Liberal governments have refined methods of bullying unemployed workers, to heighten their willingness to work hard and cheap, and make them fearful of doing anything to place their jobs at risk, like joining a union.

These refinements have been at the cost of having to ‘dumb-down’ the public employment service so its staff would be more willing to do the bullying. The Job Network (however re-badged) lacks the capacity to assess, refer, counsel, rehabilitate or develop the pool of unemployed because it is perceived as a threat and unhelpful by unemployed people.

They do not candidly share their circumstances (for fear of being breached) and therefore their barriers to employment (in addition to the insufficiency of jobs) cannot be identified, nor therefore, addressed.
And no amount of bullying can employ more people than the insufficient number of available vacancies.

And saddest of all, this defective, deskilling, demoralising system of managing the unemployed is largely a product of successive ALP governments.

The introduction of ‘reciprocal obligation’, the activity test, breaching, the privatisation of the Commonwealth Employment Service, work effort certificates… are all projects initiated, if not also implemented, by the Australian Labor Party. This is how far it has come since 1919.

So I do not expect the humanity and boldness of the Queensland Labor Party of 1919 to be honoured by the ALP of today. To be fair, that party all those years ago did not have to raise 40 million dollars every three years to fight its election campaigns.

And back in 1919 working people had Labour newspapers, public lectures and meetings at which working class perspectives could be shared and understood, so that notions like the ‘right to work’ needed little introduction when embodied in a Bill before the parliament; people knew they could have full employment, that they would be enormously better off with full employment, and that employers would resist it to the last.

At least back then the ALP knew it would win the votes of working people with such a Bill.

Today, working people are conditioned to consume, understand the world through mostly corporation-controlled television, admire the rich and powerful, not step out of line at work, and despise the poor, injured workers and the unemployed. What could the ALP possibly do with a constituency so unaware of its situation?

So the franchise continues as something akin to a management services firm, competing against its nearest rival for three year contracts to manage Australia Inc. Both create poll-driven facades in an endeavour to appeal to a majority of electors, utilising the expensive media and organisational resources provided to them by the corporate giants on whose behalf they run the country.

This is done to gain power, which they use to do both good and bad, but always with care to avoid jeopardising their funding sources. And corporate Australia has never wanted full employment.

Perhaps it would be useful to once more have a political party in Australia that advocates full employment as its central pillar – not with any expectation of winning Government – but to at least have a few voices in a few parliaments advocating full employment, not just so people can hear the case in favour of it, but to force its opponents to tell Australians why they oppose it.

Perhaps over time, the once great Australian Labor Party might find a constituency ready to support a new ‘Right to Work’ Bill with the boldness and humanity of that it once championed 90 years ago.