Bert Kelly, The Bulletin, October 16, 1984, p. 119.

A few weeks ago I said that I was going out into the wilderness to cry with the former head of Treasury, John Stone, and other hardy souls in an effort to alter our wage fixing system to make it more flexible and more suitable to our present circumstances. Well, I have talked things over with Mavis and she has agreed to let me go now that she knows that “that nice Mr Stone will be there to look after you, dear.” I could not help smiling at the thought of Stone shielding me from trouble but I had sense enough not to say so. Mavis packed me up a lot of rough clothes and thick sandwiches and sent me out into the wilderness saying, as I went out the door, that she supposed I would be back on the weekend to get my clothes washed. I think she is sick of my hanging around the place.

Fred came too. Since reading Stone’s Shann Memorial Lecture, Fred has read Orwell’s Animal Farm and he is obsessed with the fear that he might meet the same sad fate as Boxer, the big, faithful work-horse which was over-worked by Napoleon, the pig dictator in the book, and died. The picture of Fred killing himself with overwork is a tribute to his imagination which often startles me. I think his real motive for coming was to be close to Stone.

Eccles wanted to come with us when he found that he would not be alone. Eccles is always nervous when away from his ivory tower in Canberra and hates being in the bush. I remember once, when I persuaded him to leave the bitumen with me, he was sleeping on his swag on the Birdsville track and I used to see him reach out to nervously tough the wheel nuts on the Landrover to make sure he was not marooned. But he was happy to come with us, particularly with Fred; he has more confidence in Fred than in me. He had two big new suitcases of gear.

It was a long walk to the wilderness headquarters of our group. When we got there, I was surprised to find how many people were there before us. I had thought that there would only be John Stone, Professors Blandy and Niland, Messrs Brown and Rowe, those two stout hearts from Western Australia, with Fred and me to do the rough work. But evidently there are a lot of other people who are as concerned as we are. The first man I saw was Ian McLachlan, the president of the National Farmers’ Federation, who looked thin lipped, angry and determined. There was also a tent for unemployed people and this was crowded.

Our headquarters had already been named “The Rough Cruel World” (RCW for short). We tried to put up a sign saying this but the environmentalists, who had arrived there almost as soon as Stone, had already put up a lot of signs forbidding the erection of signs.

Away in the distance we could see the city, surrounded by its tariff wall, where its citizens live in the past, so we called it the city of the LIPs. We were particularly interested in this tariff wall which is beginning to crumble in parts. It is much more important from an industrial relations point of view than you might think. Up till now, many employers, particularly the metal manufacturers, have given in easily to pressure from their powerful unions for wage increases because they know that, if their costs are so increased, they only have to go to the government and get a tariff increase to make it better. And because our wages system is so centralised and inflexible, wage increases won by this kind of blackmail are quickly passed on in the name of comparative wage justice to other industries which just cannot afford to pay them. This has been the cause of much of our unemployment and explains the presence of many of the unemployed in their tent.

The condition of the tariff wall around the LIP city is a matter of great concern to us. And I am sure it has been something of a revelation to Eccles. Up till now he has concentrated on lecturing me, and anyone else who would listen, about the damage tariffs do to exporters by increasing the cost of the goods they buy and the effect of this on the CPI and so on. But now he is beginning to realise that perhaps even worse damage is done by the way tariffs allow, even encourage, protected employers to give in to excessive wage demands, and these get passed on to unprotected industries, particularly exporters.

So the state of the tariff wall that protects the LIPs is a matter of great importance to us who live in the RCW.

You may be wondering why this government seems now to see so clearly that it would be irresponsible for it to increase tariffs to enable protected industries to recover increased wage costs wrong out of them by industrial action, when the previous government did not seem to worry. We will come back to this next week.