In Bert Kelly’s maiden speech, he so obviously tried communicating in mental images that he even said, “If I were a cartoonist, I would draw a picture such as … .” Many Kelly columns are very visual.

The main difference between the first edition of his column compilation Economics Made Easy (Sun Books, 1981) and the revised edition (Brolga Books, 1982) is that the revised edition features cartoons and extra articles. Here are two of the extra articles and three of the cartoons:

1.
A Modest Farmer [Bert Kelly], “Why should Mavis want me to learn to draw?,” The Australian Financial Review, October 17, 1980, p. 17.
Reprinted in Economics Made Easy (Adelaide: Brolga Books, 1982), pp. 187-91, as “Two Cartoons.”

[AFR] Editor’s note:
This is the final column for the Financial Review by our Modest Farmer. The author, Bert Kelly, who has contributed more than 500 columns to this paper, will continue to write for the rural press.

With characteristic modesty he asks readers to be reminded that his book, One More Nail, is still available from Brolga Books, GPO Box 568 Adelaide — $9.95 post free.

Mavis has been trying to teach me to draw and the results have been disastrous. I think my fingers are too thick or something; perhaps I milked too many cows when I was a kid. Mavis’s determination started when I showed her two cartoons by Pryor in the Canberra Times. She got quite excited when she saw them. For a while I thought that the reason for this was because they were both about babies and so appealed to her maternal instincts. “No,” she said, “this was not so”; it was because they made things plain to her in a way that “my wretched writings,” as she calls them, did not.

The first cartoon shows a big bloated bloke labelled “Protected Industry” sitting sucking his thumb on Malcolm Fraser’s lap, with Malcolm patting the infant’s back to bring up the wind. Malcolm’s head peeps out from under the infant’s ample armpit and says to a partially disabled widowed pensioner in a wheel chair, “You’ve got to learn to stand on your own two feet!”

Bert Kelly protected industry Pryor cartoon

I suppose the cartoon was not really fair in a way. I do not think the government has been mean with its welfare money though it has often been wasteful and unwise. The drawing does show how the heavily protected sectors of secondary industry appear to us, though it often feels that they are sitting on our heads, not on Malcolm’s lap. I have to admit that the cartoon gives a clearer picture than my essays of the government’s priorities in these matters.

There are many lessons crammed into the second little drawing. First there is the infant industry argument. I was a little disappointed that the overgrown infant was not labelled B.H.P. because this great company is always held up as the justification for the policy of protecting secondary industry. But the B.H.P. infant has now grown so big that it looks just like that big baby in the pram, but it still demands to have its tariff bottle to suck at.

Bert Kelly 2

The $6,000 million label on the milk bottle is interesting. The I.A.C. has recently brought out a working paper in which they measure what tariff protection is costing us each year. The figure used to be $4,000 million, or that was the figure that Mr Henderson, then the Secretary of the Chamber of Manufacturers, used to admit to. That was some time ago and inflation and carelessly awarded protection has increased the cost to $6,000 million. The poignant picture of the bloated infant sucking away at that $6,000 million work of milk supplied first by the consumers, then by the exporters, farmers, miners and our better manufacturers, really hit home. The tragedy is that it is the really sick sector of our secondary industry that consumers most of the milk, the textile, clothing and footwear group and our wretched over-fragmented car industry.

Malcolm was justified in being scathing about Labor’s job creation programme. We all know now, if we take money from taxpayers to create employment, then that is that much less money that they will not have to spend for themselves to create employment. If the government gets its job creation money either by borrowing it or printing it, either course will lead to more inflation and so to lower employment. But the government’s policy of over-protection does the same thing. It may sometimes increase employment in the protected industry though frequently this does not happen. It always ends up damaging some other industry, usually an export industry.

Looking at the two cartoons together, I can see why Mavis wishes I could draw. “Now that I have seen these, I can now see what you are always writing about, dear,” she explained kindly. “Your trouble is that you use such long words and that wretched Eccles always makes everything so complicated. You must learn to draw instead.”

But so far the results of my efforts have been awful!

***
2.
A Modest Farmer [Bert Kelly], “A change of tack from the Big Australian,” The Bulletin, December 9, 1980, p. 123.
Reprinted in Economics Made Easy (Adelaide: Brolga Books, 1982), pp. 230-32, as “The Big Australian.”

One of the queer things about tariffs is that they seem to encourage people to say one thing and do the opposite; they seem to have difficulty getting precept and practice in line. There are endless examples of this. I think I have mentioned before the habit of our Prime Minister to thunder about the evils of trade barriers while overseas on the world stage and then coming home and putting up trade barriers even higher. We have come to regard this kind of behaviour from politicians with cynical contempt.

It is not only our politicians who have this unfortunate failing. The recognised spokesmen for secondary industry are at it all the time. They think nothing of condemning the wickedness of government intervention and then in the next sentence asking for another helping of government intervention in the form of tariff protection.

I knew that this kind of behaviour was par for the course for the smaller people on the secondary industry scene, but I knew that the really big people, the men with a world vision, particularly those representing BHP, the Big Australian, whose halo we see polished every Sunday night on the telly, would have a wider and wiser view of the world. So I was not surprised but gratified to read in The Bulletin of January 29 this quotation from Sir James McNeill, head of BHP:

We have to face up to it. It’s not a question of whether we like Asian products coming in and perhaps having to vacate this field. It’s just an inescapable fact and that’s the way its going to be. We won’t improve our relations by shutting out the limited range of products that they can manufacture and live by. We do have to face up to tariff reductions in industries which are sensitive to Asian production.

I presume that Sir James had imports of Korean steel in mind when he said that.

But even more telling was Sir James’ speech to the Confederation of Australian Industry in 1978. Eccles brought it to me with a seraphic smile and when I read it I knew that my confidence in Big Australians was justified. After saying that only some sectors of our secondary industry were tariff-dependent, Sir James went on, with stately logic, to say:

Even if protection was abandoned completely, there is no way these industries (the tariff dependent ones) would be wiped out.

For a start, there are already parts of them which are fully able to hold their own in the world without protection.

I am thinking of some of the more go-ahead and fashion-conscious sections of the clothing industry, for instance. Several of these industries currently have representatives able to take on all comers.

Secondly, many producers in these industries would gain as much from lower protection on their suppliers as they would lose from reduced protection on their own product.

Thirdly, in the shake-out which would nonetheless result if protection was removed, some of the existing firms would benefit as much as importers from the elimination of their local competitors.

Fourthly, if the outcome was a sharp increase in imports, the effect on the exchange rate would be such as to benefit the remaining firms in these industries along with the rest of the manufacturing sector.

Now what do you think of that? No wonder Eccles looked like a cat that had been at the cream when he brought me that speech on a silver salver. This really justified my faith that the really big Australians like Sir James McNeill would take a different view of things to the Powells and the Aitchisons, the camp followers of the mighty.

But later Eccles had the nerve to come to me pedalling the lie that BHP, the really Big Australian, with this paragon Sir James McNeill at the helm, is lining up at the tariff trough asking for a 25 percent tariff on sheet steel and that kind of thing. This cannot be, because BHP already holds 87.2 percent of the Australian market and its exports of steel are rising while steel imports are falling.

So clearly the Big Australian is healthy and well able to look after itself, as it is always telling us on the telly. It would know better than the little people how damaging a tariff increase would be for the user industries. It knows, too, that it is always held up as the justification for the infant industry argument for tariff protection, so I cannot see it asking to be treated as a Big Australian Infant at this stage of its development. If it did, it would look a bit odd, sitting like a great big infant in our laps every Sunday night.

[Note for Economics.org.au readers: Below is an image reproduced on the front cover of the 1982 edition of Economics Made Easy that seems appropriate here. (I also reproduce it here.)]

Bert Kelly 3