A Modest Member of Parliament [Bert Kelly], “Which comes first, goods or services?,” The Australian Financial Review, March 25, 1977, p. 3.

There has been a nasty little argument running the Modest Member’s family during the past few weeks.

It started when Fred finished harvest — this always makes him glow with self-righteous virtue. He works long hours and gets very nasty about the behaviour of the rest of us.

For instance, he is very scornful that the ABC news comes on at 7 pm, when he thinks all self-respecting citizens should be out toiling in the field.

“I haven’t seen the 7 pm news for months,” he snarled. “You can sit in your chairs sipping long drinks and thinking about your pretty speeches, but farmers have to work for their living.

“We are producers, not like Eccles and the rest of you who are only consumers. And because we produce things we deserve a special place in heaven.”

But Eccles doesn’t agree. He says that the production of services is just as important to the economy as the production of goods. He argues like that because he only produces services.

But Fred said that all Eccles produces are arguments and most of them are wrong. Then he turned angrily to me and said:

“And you too, you used to be a producer once when you worked honestly for a living. Now you are a member of Parliament all you do is talk and write silly stuff for the newspapers. You should be ashamed of yourself.”

Mavis heard this argument proceeding and put her head around the door and asked what was going on.

When they both appealed to her for judgment she thought for a while and then claimed that she was a producer because she produced three meals a day and she had produced three healthy children years ago and now she was producing a fine bunch of grandchildren with measured tread.

She claimed very definitely that she was a producer and truculently challenged anyone to deny it.

I suppose Mavis is right, in her muddled way. I guess there isn’t very much difference between producing meals and producing meat — both end up in the same place.

It is justifiable to claim that supplying the service to get a meal together is as important as growing the ingredients.

Fred could claim that he has to grow the things first before Mavis can make them into a meal, but the fact that Fred’s part comes first and Mavis’ second doesn’t make Fred’s task of pre-eminent importance.

Some manufacturing industry leaders claim they deserve specially favourable treatment because production of goods employs a lot of labour.

But we know that the service industries employ the largest proportion (61.5 per cent) of our workforce and the proportion employed in secondary industry is falling in Australia as indeed it is falling in all developed countries.

For instance it fell from 23.5 per cent in 1971 to 21.4 per cent in 1975.

There are two reasons for this. One is that many manufacturing processes can be mechanised and so employ less labour. I know that this happened on our farm.

When we switched from horses to tractors, we needed fewer farm workers because we didn’t have to mess around with the horses.

And as tractors get bigger we need even fewer tractor drivers because bigger tractors mean fewer tractors.

Second, as a country becomes more affluent people not only use a smaller proportion of their income on food, they also spend a smaller proportion on clothing, on refrigerators and so on.

We spend an increasing proportion of our resources on services and not goods.

Fred says that the production of services is all very well but there wouldn’t be much employment in repairing tractors (which is a service) if tractors were not being worn out producing wheat.

And there wouldn’t be any people employed in carting wheat (which is again a service) if he hadn’t grown the stuff first. So he says that there wouldn’t be many services without the production of goods.

This sounds pretty convincing until Eccles pointed out that some countries have a comparatively small manufacturing sector and yet have a prosperous economy engaging in supplying services.

At this stage I tried to get a word in so that I could make one of my decisive interventions. But the rest of them were so busy arguing with one another that they ignored me.

This is one of the penalties of being modest. But if I had been allowed to speak I would have agreed with Mavis.

Long and bitter experience has taught me that this is generally the wisest course, particularly as she produces the meals.