Bert Kelly, The Bulletin, December 11, 1984, p. 135.

Eccles seldom takes me to his ivory tower. He sometimes used to when I was still in parliament and, so, was a minor power in the land. Then he would take me round in an embarrassed kind of way, saying to his colleagues:

This is my friend Bert Kelly. He is a member of parliament, but he means well. You might perhaps think it worthwhile to explain university matters to him at a fairly low level.

But, now that I am washed up on the political beach and am sunburnt and scruffy looking, he seldom takes me to his academic haunts. The other day, however, he made me clean my nails and took me to lunch with some of his more distinguished colleagues. They were a stimulating lot, though in appearance they really were not much more imposing than Fred or I. But it soon became clear that they breathe a purer air than we do; they see things from a loftier level.

Probably because they had been briefed by Eccles — or they may even have been reading this column — the conversation soon got around to the adverse effect of high youth wages on youth unemployment. With typical modesty, I offered the tentative opinion that youth wages were too high in relation to adult wages and that this was the reason for the tragically high level of youth unemployment. As you know by now, I seldom have original ideas but I skim the cream of other peoples — so I quoted from Clyde Cameron’s book Unions in Crisis. He says, recounting his experience as minister for Industrial Relations in the Whitlam government:

We have not helped the young by demanding that they not be employed unless paid excessive wages. We priced them out of the labour market and we deserve no thanks for that. We forgot also that there is a generation gap between young job-seekers and those who do the hiring which means that, when labour is plentiful, employers will opt for experience and maturity.

I thought that this judgment from such an eminent authority would be accepted by everyone but it had little effect on Eccles’ colleagues who demanded more concrete evidence. One of them asked, looking down his nose: “Which university did this Cameron man attend?” When I muttered something about “hard knocks” they were clearly unimpressed. I admit that they have a splendid view from the windows of their ivory tower; you can see for miles into the distance but not down to the grassroots where Fred and I live. If they really need concrete evidence to demonstrate that lower youth wages would increase youth employment, they clearly do not understand the rough cruel world.

I attended a taxation seminar in Canberra in 1980 and heard two very prestigious academics say that there was no concrete evidence of a taxation revolt. This startled me because even I knew that the taxation world reeked with big and little taxation revolts, so I told them that they reminded me of the madame who was playing the piano downstairs in her brothel during a police raid and telling them that she did not know what was causing all those thumping noises upstairs. I thought that this would put the two in their place but not a bit of it. One of them sidled up to me later and asked: “What was making those thumping noises?”

Of course, we cannot get hard evidence that a sensible reduction in youth wages would increase youth employment for the simple reason that their wages are not allowed to fall to the market level but are held artificially high in order to protect the wages and employment of adult workers.

I have before me the transcript of a telephone conversation between an officer of the Victorian Equal Opportunity Commission and a staff member of the fast-food people McDonalds, who employ a lot of young people. The commissionman said:

We are investigating apparent age discrimination in your employment practices in Victoria. It is obvious that you sack people at 20 and replace them with 16-year-olds, thus effectively discriminating against older people.

So there it is, straight from the bureaucratic mouth — a deliberate effort to protect older people at the expense of the kids.

Former federal Treasury chief John Stone puts it more powerfully. He says:

Overwhelmingly the most important reason for it (youth unemployment) is the barrier to their employment which is represented by the minimum wage rates which their employers are legally required to pay them … The truth is that our system of wage determination constitutes a crime against society. It is, starkly, a system of wage determination under which trade union leaders and people preening themselves as “justices” of various arbitration benches combine to put young people in particular — but many others also — out of work.