David McNicoll, “Where others failed, Lang laid them in the aisles,” The Bulletin, March 21, 1978, p. 39, short excerpt. Talks about the reception of a Lang Hancock speech at the International Press Institute Assembly held in Canberra the week before.

Watching the Japanese delegates, as they sat with their interpreting earphones on, proved one of the diversions of the conference. A group of us switched our gaze to them whenever anything light-hearted, outrageous, or particularly controversial was said. They never cracked — not a smile, not a frown, not a look of puzzlement … But Lang Hancock got them. His outrageous (but often bang-on) dissertation about what he would do if he ran the country had the Japanese delegates rocking with laughter, nudging and nodding. Hancock stories will be the big goer at Tokyo dinner parties for a long time to come … I particularly liked Lang Hancock’s description of Sydney-Melbourne-Canberra — “The Bermuda Triangle.”

Bert Kelly, October 19, 1979. Economics Made Easy (Adelaide: Brolga Books, 1982), pp. 65-67, as “Tariffs and the P.M.”

When I listen to speeches made by the really important people in Canberra, the ones written for them by speech writers, I go weak at the knees with envy and admiration. Let me give an illustration from a speech made in August this year at Lusaka in Africa by the Prime Minister. I quote from it with proper reverence:

The concept of economic interdependence is not without its ambiguities and is sometimes put to questionable polemical use. But when all reservations have been registered the fact remains: our fates are inextricably intertwined and in the contemporary world no society is an economic island.

You can see what I mean when I talk about the grandeur of it all. It is true I have some trouble understanding the meaning, but you have to admit it sounds magnificent.

But it was later in the same speech that I really pricked up my ears. For one thing, I could understand what was being said and, secondly, I agreed with it whole-heartedly. This time I quote with understanding and approval:

The Australian view is that there is also an inescapable link between inflation and protectionism. Each feeds on the other and each frustrates the aspirations of developing countries. There is no doubt that the adverse effects of higher inflation in recent years are largely responsible for the drift towards protectionism … Defensive protectionist policies exacerbate the situation they are meant to deal with, in that they result in an inefficient use of labour and capital resources. They are inimical to general economic recovery and put the future growth of developing countries in jeopardy.

Well, what do you think of that? When I showed it to Eccles he said “I couldn’t have said it better myself!” and that is the highest praise Eccles knows.

There was a time when I would have been wary about what appears a change of heart by the Prime Minister. I once thought that he had two speech writers, one who wrote the nonsense he used to talk in Australia about handing out tariffs to any industry that had a strident voice and a readiness to kick in the ruck. Then there was the other more educated chap who wrote sensible stuff for the Prime Minister when he was overseas. I thought that these two speech writers must have had a row or something and so they never spoke to one another. But now I am getting hopeful that Mr Fraser’s emergence as a recognised world figure has made him realise that he can no longer act on the world stage as a world statesman talking about the virtues of lowering the barriers to world trade and then come back home to practise what he has been so eloquently and properly condemning while away.

The economic experience at home would also be nudging him along the same road. He must by now have become acutely aware that there has been a steady fall in employment in the very industries that have been so heavily protected at such high cost to the economy in general and the export industries in particular. So I think the Prime Minister really means what he says now. At least, I hope so.

Bert Kelly, The Australian Financial Review, February 2, 1979, p. 3.

Ministers usually want one thing above all others and that is a quiet life.

I can understand this.

Usually there are almost immediately inundated in a sea of paper which it is essential that they read.

And they still have their constituencies that have to be serviced.

And they know that any little slip that they make will be magnified by the Press Gallery which is always waiting to pounce.

Also they know that their backbench colleagues are always waiting hopefully for them to stumble and fall.

So there is a great temptation for ministers to sidestep problems that, as backbenchers, they would have wanted to tackle, or to see someone else tackle.

And usually ministers are aided and abetted in this longing for a quiet life by their departments.

The departmental head has probably got where he is by not disturbing the promotion ladder as he laboriously climbed it.

And he has probably got far too much to do anyway so does not want other problems to raise their ugly heads.

And those below him in the departmental peck order are acutely aware that rocking the boat will make them unpopular and so jeopardise their chances of promotion.

So there are considerable departmental forces operating to encourage the quiet life.

And when the minister and his department meet the real world at the workface, again there is a reasonable expectation that the people from industry that they meet will also want a quiet life.

Perhaps they may have been appointed by the minister and so will want to show a proper appreciation for his kindness and wisdom.

And indeed some of them may have been appointed because they have demonstrated their ability to keep their heads down and out of trouble as they climbed the ladder of industry politics.

So when the minister, departmental administrators and industry leaders meet together, say, in an industry council, you will frequently find that one thing on which everyone agrees is the importance of not rocking the boat, so things usually proceed with a delightful smoothness.

I have often admired the competence with which everything is arranged.

Christian names are used with a practised skill and a delightful club-like atmosphere is evident everywhere.

If perhaps a slightly discordant note might sometimes disturb this placid pool of agreement, perhaps by the representative of the consumers who probably knows little about the intimate workings of the industry, he will be quickly duchessed in the nicest way.

And, if that does not work, the minister may be asked to use his hammer instead of his hands.

The industry councils are notable for the smoothness of their operation with only the poor consumers getting it in the neck.

But no one worries much about these poor people in these days of pressure politics.

And the same smoothness of an efficient machine in operation is seen when some of the primary industry boards are co-operating with the Government.

Again you see the convenient arrangement between the recognised experts of the industry, those that know their proper place in the scheme of things and who have a reasonable expectation of appearing on an honours list one day if everything is done in a well-ordered way.

It may be that this will-modulated system is paid for by the poor old consumer, but, with the primary industry boards, there is another group whose interests may be sacrificed on this all important altar of agreement.

The farmer who wants to do something different.

Perhaps he is a simple man who finds it more profitable to grow a variety of wheat that complicated the Wheat Board’s well-understood and accepted handling procedures.

Or perhaps the wretched man wants to grow six-row barley which the Barley Board doesn’t like.

So the conventional wisdom takes control.

I know from experience that the pleasant and placid pool of agreement that often exists at the workface between the Government and the governed frequently exists because too many people want peace at any price, their main interest is to have a quiet life.

L.W. Lower, “A Long Lane Gathers No Moss: L.W. Lower decides to give up Proverbs and lead the simple life,” The Australian Women’s Weekly, June 25, 1938, p. 13.

I was always hot on uplift and kind thoughts and good deeds. Well, not so much the good deeds, but I’m just crawling with kind thoughts on most occasions.

Now I’ve got a new pocket book with a special sort of calender in it, I’ll be able to get better and better every time I look at it. It’s got a Thought for the Day on every leaf.

“Habits are at first cobwebs; at last cables.” “The secret of life is not to do what one likes, but to try to like what one has to do.” Oh, yeah?

“The greatest truths are the simplest; so are the greatest men.” Phooey.

These proverbs have done more harm than can ever be calculated.

That “Early to bed, early to rise” one, for instance. I had so much of that as a child that nowadays I only go to bed when I’m in a state of exhaustion and collapse. My idea is that if you don’t go to bed you don’t have the bother of getting up.

I’ve got a nephew with similar ideas. “Always remember,” I told him, “a stitch in time saves nine.”

“What are you talking about?” he replied. “I can’t stitch.”

“It’s a proverb,” I explained.

“What’s a proverb?”

“A proverb — well … Ah, go to bed! Always asking silly questions!”

You can’t do anything with a boy like that. He’ll probably grow up without any moral sense, make a fortune, and be knighted.

“If you have knowledge, let others light their candles at it.” It’d be hard to think of anything daffier than that.

The Editor has one of these things. I suppose that’s why he told me the other day that “constant dripping wears away a stone.” I looked hard at him for a while, decided that he was perfectly sober, and put it down to overwork.

One good thing, now that I have this proverb calendar of my own, I’ll be able to get one back on him.

“Be wiser than other people if you can, but do not tell them so.” That one ought to topple him.

My grandfather had a proverb for every occasion. Boiled down, what they all meant was, “Don’t enjoy yourself; it annoys me.”

Supposing a man came and served you with a summons and said, “It’s always darkest before the dawn. Every cloud has a silver lining. Let this be a lesson to you that a stitch in time saves nine and an ounce of prevention is worth a pound of cure.”

Morally, you’d be quite entitled to tramp on him.

Very Perplexing

If I took any notice of my proverb calendar I would be going to bed at six o’clock at night and getting up at four in the morning. I would be casting bread into the water where it would sink immediately, and I would be dashing about striking irons while they were hot.

For which conduct I would probably be taken to the Reception House and kept under guard.

The world seems to be full of people who insist on telling you what to do. Leaving out the bans on murder and shop-lifting and kindred crimes, such as not crossing the street at right-angles, it’s astonishing the number of things I’m not allowed to do. My doctor told me last week to cut out smoking, drinking, and eating meat. Then he had the nerve to charge me for it!

My wife told me not to stay out late, not to waste my money on horses, not to throw my hat on the table, not to go out just when the dinner is ready … oh, well, you know it all.

Moral advice has a strange effect on me.

If anyone warns me about some gambling hell which should be avoided at all costs I’m always there waiting on the mat to get in. It’s not perversity. It’s just curiosity. Anyhow, that’s my theory, and I’ll stick to it.

Now I come to think it over, the more I look at this proverb calendar the less I like it.

Once I was happily ignorant of the date and I didn’t know or care about “great oaks from little acorns grow” and “a penny saved is a penny gained.”

Now, glancing at the cursed thing I find that I’ve been doing the wrong thing ever since I could walk.

My philosophy of life is different, I am going to throw away my highly moral calendar and buy myself an egg-timer.

I’m doomed to eternal perdition, I know, but I won’t have that calendar reminding me all the time.

Bert Kelly, “Monarto … and why it went wrong,” The Bulletin, November 3, 1981, p. 44. This is the first and so far only article in The Bulletin by Bert Kelly that I have found that is not his Modest Farmer column.

I know that people from the eastern States used to regard us South Australians as a dull lot. Adelaide was known as the city of churches and we had old-fashioned ways of looking at sin and six o’clock closing. We also had an old-fashioned Premier called Tom Playford and no one could call him exciting, though he was good at governing that part of the country. Jack McEwen once said of me that he could think of no man who had more to be modest about. Well, we have plenty to be dull about, our people worked hard in a dull kind of a way, we did not have great natural resources or a lot of fertile land with a decent rainfall and so on. But all the same we kept on growing. It is true we grew like Topsy instead of in an exciting, well-planned way and people used to sneer at us because we didn’t see visions in the night. We were dull indeed, but at least we paid our way.

Then Don Dunstan took us over and we stopped being dull. Life became exciting and people from Melbourne and Sydney used to pat us patronisingly on the head and tell us we had reached the big league at last. Then when Mr Whitlam took over in Canberra it seemed that there were two suns in the South Australian sky at once and we felt that we were about to go into orbit.

All kinds of exciting developments awaited us. We had a Lands Commission which was to demonstrate the superiority of socialist planning over capitalist greed. This is now being disposed of. We had a frozen food factory which perfected the technique of losing money faster than anything known before. But the pride of our South Australian hearts was the Monarto development, this Dunstan-inspired vision of a new city designed to absorb the bourgeoning population of Adelaide.

With the eager and generous assistance of the Whitlam Government, 18,600 hectares of farming land were purchased and planning by experts began in a big way. Each new planning step was unveiled with proper pomp and pageantry before a bemused populace. We were so used to being dull that this new exciting world was hard for us to absorb. Over half a million native trees were planted and on the contour too. Areas for recreation were thoughtfully set aside; indeed it was planning at its splendid best. Nothing was overlooked and everything met with universal approbation. The only argument was about the new city’s name; many wanted it called Camelot.

The only thing that went wrong was that the Adelaide population stopped burgeoning. So after spending about $27 million of State and Federal taxpayers’ money, there are now fewer people living there than there were before we stopped being dull. The present government is now engaged in disposing of the land by feeding it on to the market gradually and a careful examination of its budget papers seems to indicate that it hopes to recover about $9 million, which will leave us with a cost of about $18 million for which we will have gained some experience, some trees but no houses at all.

I know it is easy to be wise with hindsight, but surely a careful examination of the population figures of the late 1960s would have sounded the alarm bells for those who wanted to listen. And how could the politicians be expected to foresee that their way of splashing money around was scaring the daylights out of the business community? All their camp followers were fawning on the politicians and praising their splendid vision, but business was slowing to a walk, making the need for a new city recede even further and the whole vision started to look silly.

This had been a sad experience for us. Under Playford we were dull, but at least we were reasonably well off. Then for a while we were dragged into an exciting new world led by our new Messiah, Don Dunstan, and we wasted our substance in riotous living. Now we have gone back to being dull again, but this time we are poor as well. I suppose that we can take some comfort that we must be wiser, if poorer, for the experience; but I am not even sure about this. I have an uneasy feeling that wisps of the Dunstan clouds of glory may still trail through the South Australian corridors of power. I can sometimes almost feel another vision coming on.

by Viv Forbes, winner of the 1986 Australian Adam Smith Award for “outstanding services to the free society”

It seems that whenever global warming alarmists have no supporting evidence or logic, they resort to name calling using terms such as “vested interests”.

Warmists claim that earth’s climate is controlled by man-made carbon dioxide, mainly from coal and oil. A huge climate industry has been constructed on this flimsy foundation. Is Australia best served if we base energy policies solely on uninformed or emotional opinions from rock stars, lawyers, economists, union leaders and the climate industry? Surely it is sensible to also listen to scientists and engineers with training and experience in the origin, history, chemistry, geology, physics, extraction, utilisation and waste products of coal and oil and the behaviour and role of carbon dioxide in the atmosphere?

Another tedious slur is that those who opposes climatism are supporters of big coal and “lobbyists are paid by multinationals to produce this stuff”. In my case this is very easy to refute. Just look at what I have said and written and check that against policies supported by coal industry lobbyists such as the Queensland Resources Council (QRC).

The QRC people ARE paid to promote the views of the coal industry — I am not. They promote three key policy pillars — a global agreement to ration and tax carbon, emissions permit trading, and subsidies for green power.

Never have I or the Carbon Sense Coalition ever supported any of these shaky pillars. We have repeatedly urged rejection of the Kyoto agreement; we have been consistent critics of emissions trading and the carbon tax; and we oppose money wasted in subsidising green energy toys and silly schemes like Carbon Capture and Burial.

Other superficial critics gleefully report that anything I say is merely promoting my vested interests in Stanmore Coal, a small Australian owned and managed explorer in which I hold shares. The reverse is true — Stanmore will be less harmed by the carbon tax than many other Australian businesses and may even derive some benefits. Stanmore’s main asset is an open cut thermal coal deposit planning to export coal, probably to Asia for power generation. The carbon tax in Australia will fall more heavily on gassy underground coal mines and will also drive our power intensive industries overseas, probably to Asia, thus increasing Asian demand for coal from projects such as Stanmore.

Naturally the snipers never reveal my long and continuing interest and experience in pasture management, grassland conservation, sustainable soils and the carbon cycle. I do not condone pollution or environmental degradation.

Every Australian has a vested interest in the outcome of this suicidal war on carbon — some will get unearned benefits, most will be lumbered with hidden costs. So instead of smearing, name calling and name dropping, it’s time for the green side to put up some relevant facts and logical arguments.

Or find a real problem to solve.

J.F. Moyes, Hancock and Wright (self-published, 1973), pp. 34-36, ch. 5.
With thanks to Gina Rinehart of ANDEV.
More info at LangHancock.info and GinaRinehart.info.

Traditionally Western Australians buy only two newspapers — the only two available to them. The West Australian in the morning and the Daily News on the way home.

But there are people — and their number is growing — who realise that more than the Nullarbor Plain separates the West from the East. There’s also a communications gap which results, largely, from the West Australian Newspapers’ comfortable monopoly.

Neither The Australian nor the Australian Financial Review arrives in time to compete with the West — they’re not on sale until around lunchtime. But their readership is growing as more and more people become increasingly aware that the West tells them only what it feels they should know.

Take the Minsec business, for instance.

The West Australian, on January 25, 1972 reported a Press conference given by the official liquidator of Minsec, Mr J.H. Jamison. The West reported:

He (Jamison) asked unsecured creditors to be patient till Robe River’s new iron reserve totals were disclosed — which he expected within three months …

“When the ore reserve position is settled a sale may be possible at a price in excess of $1.15 a share.”

Readers of the West could be excused if they read this to mean that Robe River was re-assessing its reserves. Only if they read The Australian or the Australian Financial Review would they know that Robe River was going to get ADDITIONAL reserves.

The Australian reported:

Mr Jamison is pinning his hopes on getting $1.15 for the Robe share, and he bases this figure on the expectation the Robe River venture will be awarded new iron ore reserves within the next few months.

The Australian Financial Review reported:

Mr Jamison told reporters he would ask creditors to be patient until the company got the new reserves.

“I expect to hear about these reserves within three months,” he said.

“This is not based on just a thought of mine, but on information gleaned from proper sources — naturally one cannot anticipate a Cabinet Minister’s decision.”

Maybe this was just another instance of bad reporting by the West Australian. But people who watch these things say that the West is often guilty of indifferent reporting — or whatever it is. And maybe there is no connection with the fact that Hancock and Wright own a Sunday newspaper and could, by using their iron royalties, perhaps compete in the daily newspaper field.

Take another example. On December 3, 1971, the West carried a banner headline on its front page, “Court: Hanwright used mafia tactics.”

The story of Court’s attack on Hancock and Wright occupied 28 inches on the front page and continued with 27 inches on page 10. A total of 55 inches.

A week later the Premier (Mr Tonkin) said in the Legislative Assembly, “there was no known evidence in any Government department of mafia-like tactics having been used against the former Premier or any Ministers in the former Government.”

Tonkin’s statement appeared on page 13 and it occupied only six inches.

And apparently the West didn’t believe Mr Tonkin. A few days later, in a leading article, it said: “The State Government has evaded its responsibilities in deciding against appointing a royal commission to investigate allegations that the mining partners Lang Hancock and Peter Wright had used standover tactics and intimidation in their dealings with the previous Government.”

In the article the West did admit that:

It is surprising that the Leader of the Opposition, Sir David Brand, and some of his former Ministers were opposed to a royal commission …

It is astonishing that the Brand Government did not have the whole matter thoroughly investigated when it was in office.

Its failure to do so is no reason why the Tonkin Government should sweep the matter under the carpet. It should think again. On one hand the rights and responsibilities of Government are involved; on the other, the reputation of two internationally known men …

One wonders, if the West was so concerned about the “reputation of two internationally known men”, why Mr Tonkin’s denial of their mafia-like tactics didn’t receive the same prominence in the West as Mr Court’s original and unsupported allegation.

One wonders, too, why other statements in the Legislative Assembly failed to find room in the West. Here, for the record, are a few, taken from Hansard:

Mr Grayden (Lib. South Perth): Has the Minister (Mines Minister May) experienced mafia-like tactics from Hancock and Wright?

Mr May: Definitely not.

Mr Young (Lib. Wembley): I am not making this speech on behalf of the Leader of the Oppositon. My own belief is that the inquiry should be made on all facets.

Mr Graham (Deputy Premier): Including whether the Deputy Leader of the Opposition threatened overseas firms that if they held talks with Hancock and Wright they would be investigated too?

Mr Young (Lib. Wembley): The last Government did everything possible to get Hancock and Wright to the table.

Mr Graham (Deputy Premier): Are you sure of that. For months the Minister (Court) could not even talk to them.

None of this appeared in the West.

An article in Nation in 1969 explained:

W.A. Newspapers has always been sceptical and uninterested in the colossal growth in the State’s North-west. This stems from an official news attitude within the organisation that has been expressed as: “What the average housewife in Perth doesn’t understand, we don’t print.”

In 1969 Hancock and Wright began publication of the Independent, a Sunday newspaper. A major reason for the partners moving into the publishing business was one which Nation included in its May 1969 article:

The trigger that set off the Hanwright train of thought of establishing a newspaper was remote from the world of printer’s ink. Mr Hancock, a station owner near the present Mount Tom Price operations, was once the operations manager for Australian Blue Asbestos, Colonial Sugar Refining’s operating company at the Wittenoom Gorge asbestos mine. When CSR closed the mine as uneconomic in 1966, Hanwright bought the mine, the town and the equipment for an undisclosed price, believed to be around $1,600,000 and announced plans to reopen the mine for iron.

Hanwright proposed to build a railway, port facilities and beneficiation plant. A journalist, Lloyd Marshall, working for W.A. Newspapers’ evening daily, the Daily News reported and commented on this signficant development.

Mr Marshall was summoned to the office of W.A. Newspapers’ chairman of directors, Mr S.J.F. Hocking, to be told that there was no iron at Wittenoom. Mr Marshall came from an old-established Western Australian literary family, he had done extensive work on developments in the north-west, and many of his view coincided with those of Mr Hancock.

Mr Hocking, who also runs the Kalgoorlie Miner in the Goldfields, is said to have had what he believed to be reliable information from a geologist that the iron potential of Wittenoom was nil.

Mr Marshall told Mr Hancock of his employers’ views, and this was apparently the straw which broke Mr Hancock’s toleration.

Later, when Mr Marshall announced his resignation, he was given an hour to clear his desk and told never to be seen in the building again.

Hanwright’s Independent is, as yet, no threat to Rupert Murdoch’s Sunday Times and, of course, it does not yet compete with the Melbourne Herald-owned West Australian or Daily News.

But Hanwright have said that the Independent will, one day, become a daily. This prospect of competition does not enhance the Hanwright partners’ popularity with the newspaper Establishment. But it has given them a voice, even though it’s cost about $2 million to date to do so.

J.F. Moyes, Hancock and Wright (self-published, 1973), pp. 24-32, ch. 4.
With thanks to Gina Rinehart of ANDEV.
More info at LangHancock.info and GinaRinehart.info.

The Federal Government export embargo on iron ore was lifted in 1960 — a partal relaxation which, the Government hoped, would encourage people to look for new deposits. But as far as Western Australia was concerned the Commonwealth’s hopes were quite naive because there was a long-standing State blanket on iron which precluded the prospector or discoverer from having any rights to his discovery.

Though Hancock welcomed the Federal Government decision as being the first step in stimulating exploration, he could not announce his 1952 ore discovery. Under the State laws he had no right to do it.

But the writing was on the wall and he knew that it could not be long before the W.A. Government would have to encourage people to go out into isolated country and to find iron ore with the prospect of their efforts being rewarded. Hancock and Wright knew the size of the ore body they had found. They wanted a partner big enough to handle it.

There was still need for caution because the State blanket remained. The partners attempted to canvass the proposition inside Australia, but they found that the local response was very cool. They wrote to 30 of the world’s largest mining companies, and again the answer was “No”.

The best response came from Rio Tinto, and Hancock and Wright welcomed the response for two reasons. One was that Rio Tinto was one of the world’s largest mining companies, and the other reason was that the partners had some protection of their rights under a letter from Rio Tinto dated December 1, 1959.

So with the Federal embargo relaxed and the prospect of a fairly speedy removal of the State blanket, Hancock and Wright opened talks with Rio Tinto.

The partners were back to square one, where they’d been with C.S.R. over the blue asbestos mine. They had, they believed, a viable asset. But they had no capital to prove it. And so they could only negotiate on one basis — the basis of result. No result, no payment.

The C.S.R. deal had taught them the lesson of not selling their assets, and so they sought (and received) a royalty. The same royalty they had negotiated in their agreement with Rio Tinto over asbestos and other minerals — 2.5 percent of the f.o.b. value of the ore.

In the dying days of 1960 Hancock rang the Managing Director of Rio Tinto (Mr Pat Robinson) in Melbourne, and it was agreed that Hancock and Wright would arrange to send vehicles and land parties into the field to peg out the principal areas of interest pending the lifting of the State blanket. Hancock himself went north, and on January 4, 1961, he received a telegram from Rio Tinto:

HANCOCK
HOTEL FORTESCUE
WITTENOOM

DR CAMPANA LEAVING MELBOURNE 1/25 4TH ARRIVING WITTENOOM 12/25 THURSDAY 5TH STAYING UNTIL TUESDAY

Bruno Campana, a Swiss geologist, had joined Rio Tinto in Australia in 1957 and had worked on the west coast of Tasmania and then at Mary Kathleen. Rio Tinto had a lot of faith in his ability.

Robinson called Campana to his office and asked if he’d ever heard of a station owner and prospector in Western Australia named Langley Hancock. Campana hadn’t — but over the next few years he was to know the name, and the man, very well.

It was 120 degrees at Wittenoom when Campana landed, and the small room at the hotel to which Hancock took him was not much cooler despite the air conditioning. They began to talk and Hancock told him, briefly but convincingly, of the discovery he had made in November 1952.

Campana asked him if he would draw a sketch map indicating the distribution of the suspected deposits. Hancock drew the map and then, at Campana’s request, a typical cross-section of the deposits.

“I’m not much of an artist,” Hancock said. “But in profile it’s like a flat-topped tent and on top of it there’s an iron slab.”

Campana understood immediately. What Hancock had discovered and pictured with simple accuracy, was a type of ore body known as a superficial limonitic table.

“We call the tent wit the iron slab on top a mesa,” Campana said. “When can we go and have a look at it?”

“Let’s fly there tomorrow,” Hancock said. “I’ll be ready to take off at dawn.”

The early sunlight and morning shadows threw the iron ore tables into magnificent relief. They were like huge slabs paving the bottom of the broad valley along the Turner River, Duck Creek and Boolgeeda Creek.

Hancock flew about a hundred feet from the cliffs which formed the edge of the deposits — a 60-mile long belt of flat-topped hills, each one up to three miles long.

Campana was eager to get down and examine the ore on the ground. He’d only spent a few hours with Hancock but already he’d summed him up as a man whose passion for minerals was equalled by his passion for flying.

“Can you land down there?” he asked and Hancock nodded.

The plane flew low along the dry valley floor and then Hancock put it down in a small patch clear of the dry scrub, rock splinters and ant hills.

Campana scrambled from the plane and waited. In 25 years of field research he’d become accustomed to prospectors and he’d never found one who would leave him alone to study a prospect. But Hancock was different.

“I’ll boil a billy and we can have some tea for breakfast,” he said. “You go and look around and get whatever samples you need.”

Three days later they were in Perth, and Peter Wright was waiting for them. He was anxious, full of questions. What did Campana think of the ore? How much of it was there? Was it pure or impure?

Campana told him that the deposits were undoubtedly very large — at a guess in the order of 1000 million tons. But they’d have to wait for chemical analysis because deposits of the kind he’d seen were often contaminated by impurities which made them almost worthless for making steel.

Wright pressed his question. Were Hancock’s deposits pure or impure?

“According to the text books they should be very impure,” Campana said. “But judging by what I have seen for myself they should be very clean.”

And so it proved. On February 20 Campana presented his preliminary report to Rio Tinto.

The report made four major points.

1. The deposits discovered by Hancock formed an iron field of world class.
2. The reserves, in the order of 1000 million tons, were much higher than the total reserves of iron ore known at that time throughout Australia.
3. The limonitic had a 50%-57% iron content and low impurities (0.04-0.06 phosphorus) and therefore was suitable for steelmaking.
4. That Rio Tinto should immediately secure the reserves.

But there was no way of securing the reserves. The state blanket was still in force — though not for long. On March 29 the Premier announced a new policy.

To implement the new policy, Western Australia’s iron resources had been divided into three categories, the Premier said. They were:

1. The major known deposits of high-grade haematite ore not at present covered by lease agreements.
2. The big number of medium and low-grade deposits.
3. Now unknown deposits which were believed to exist.

The major known deposits were at Tallering Peak, Mt Goldsworthy, Wilgie Mia, Mt Halte, Mt Gould, Mt Walton and Joyner’s Find.

The government was now inviting individuals or companies to apply for an exclusive right to temporary reserves — for a permit to explore under the second and their categories. If a permit to explore let to the discovery of economic deposits, titles of mineral claims or leases would be granted.

This was the announcement Hancock and Wright had been waiting for since 1952 — almost 10 years during which they knew they had an iron ore deposit bigger than anything in Australia and they hadn’t been able to do anything about it.

But now the way was clear. Hancock had moved men into the iron belt weeks earlier. Michael Wright, Peter Wright’s son, was at the southern end where he’d been alone, isolated by floods, for three weeks.

Keith Wilkin, later manager of Hamersley Station, was in the centre and at the northern end was Jack Johnson, lonely as a lizard while he awaited the signal for action.

It came on March 29 — a rocket signal, clear against the blue sky. And the three men swiftly moved through the sixty mile long valleys, attaching dated claim forms to the three-foot pegs they’d earlier driven into the ground.

The claims were pegged in the name of Hancock Prospecting Pty Ltd, whose Miners Right number was 18770 issued at Perth on June 14, 1960.

On May 29, 1961 the State Government allocated more than 100 iron ore exploration reserves. The following day the West Australian reported: “Rio Tinto, in association with Hancock Prospecting Pty Ltd and Wright Prospecting Pty Ltd, has received a new search area of 650 sq miles in the Hamersley Range-Duck Creek area.”

Bruno Campana had not found much encouragment at some levels within Rio Tinto. His preliminary report was considered impetuous.

But at Board level there was greater acceptance first from Pat Robinson and then from John Hohnen, an Australian mining engineer, who succeeded Robinson as managing director.

Hohnen and John Rodd, the Vice-Chairman, visited the field in March to make a first-hand assessment of the limonitic tables.

In view of the impending visit, Hancock thought he should do something about a landing strip. He didn’t mind landing among the scrub and the ant hills, but he felt that things should be a little safer for Hohnen and Rodd.

So he sent Bill Newman, a prospector, out to cut down the mulga trees along the river beds. It took Newman four days driving, covering seven miles a day, and even after the trees had been cut down the landing ground still remand rough and cracked. But at least it gave Hancock a straight run when landing or taking off.

From March to September Campana made a number of visits to the field, flying with Hancock almost daily. They would fly out at dawn, and at sunrise the low-angle light threw the huge geological structures into sudden relief. The vast chain of mountains became a splendid array of rock layers which, Campana knew, had piled up some 2,000 million years ago in what was then the Hamersley Sea.

It was on these flights that Campana noticed what geologists now call the “Bruno Band”. Hancock, who saw it at the same time and immediately realised its significance, called it the “Campana Horizon”.

The “Bruno Band” was black, hard and prominent in the landscape. It underlay the ore-forming horizon and stood out as a marker-bed for the mineralisation throughout the Hamersley Range. Hancock and Campana followed it from the air and mapped it over a total distance of 1100 miles.

By September 30 Campana had established the presence, within the original reserves and others which had been granted, of:

• 1000 million tons of limonitic ore, mapped and sampled
• Extensive limonite deposits along the Robe River, Fortescue River and Dale Gorge areas.
• 350 million tons of high grade haematitic ore (58-62%) in the Hamersley Station area, Mt Brockman syncline and Mt Pyrton and Mt Lockyer areas.

Campana could also infer that the reserves of bedded haematite were many times greater than those recognised so far because only about a sixth of the marker bed has been explored.

And what about Mount Tom Price? Who really discovered it?

There are, and no doubt always will be, conflicting claims and the evidence is pretty clear that the conflict arises from a combination of jealousy and the definition of the word “discovered”.

Hancock says that he first saw the area in 1958, and certainly it does seem to be included in the first list of temporary reserves for which Hancock asked Rio Tinto to make application. Hancock was seeking some 40 TRs, but when the Rio Tinto executives arrived in Perth only 24 hours before the deadline for applications Hancock found they had cut the number down to four.

There was quite an argument! The outcome was that Rio Tinto agreed to increase the number to 13 or 14. But the area including what is not Mount Tom Price was left out.

At this stage, certainly, Hancock had no idea that Mount Tom Price was the bonanza it had proved to be. Neither had anybody else. But Hancock did not forget it, and in June 1962 he flew Dr Campana over the area. Campana was impressed, mapped the area roughly in the plane and later transferred his rough map to the “master” map in the company’s headquarters at Bulgeeda.

Campana says he included a recommendation that the area by investigated immediately on the ground because BHP had temporary reserves a few miles east. Two geologists from CRA (the company formed in July 1962 by the merger of Rio Tinto and Consolidation Zinc) reached the deposit in September.

So who “discovered” Mount Tom Price? The man who first saw in 1958, recognised it as iron, and sought to persuade Rio Tinto to apply for a Temporary Reserve over the area? That was Lang Hancock.

The men who flew over it in June 1962, mapped it and recommended it be investigated on the ground? Dr Campana and Lang Hancock.

Or the two CRA geologists who arrived on the ground in September 1962 and confirmed that it was an iron ore deposit?

Depends on the definition of “discoverer”, doesn’t it?

There seems also to be more than a trace of jealousy on the part of CRA directed at both Campana and Hancock. They had both been associated with Rio Tinto and, in Australia, Rio Tinto people seemed to become very much poor relations after the merger with Consolidated Zinc.

The Annual Report of CRA for 1962 reported:

During the year Messrs F. Byers, R.H. Harding, J.H. Hohnen and R.W. Wright (former Directors of Rio Tinto Australia) retired as Directors of the Company. Sir Maurice Mawby and Messrs F.S. Anderson, R.C. Atherton, C.A. Byrne, D.J. Hibbert, R. Pitman Hooper and A.J. Rew (former Directors of Zinc Corporation) were appointed additional Directors. … Mr B.R. Pelly retired as Chairman and Mr J.M. Rodd retired as Vice-chairman.

Zinc Corporation was firmly in the saddle.

It’s not surprising that Campana left the field soon after CRA took over. He returned to Melbourne to find that Rio Tinto had moved into the CRA glasshouse in Collins Street.

There they fed him cups of tea (“It was delicious — a special Ceylon drop”) and files containing old technical magazines. Sir Maurice Mawby gave him a silver plate with clouds of engraving around the name “Bruno Campana”. And Campana decided to go back to Switzerland.

He’d been employed by Rio Tinto. He’d been guided by Hancock to the original discovery and he’d done the detailed work which led to the discovery of 4,850 million tons of commercial iron ore. But CRA, it seemed, didn’t want him any more.

While Hancock was busy flying Dr Campana over the deposits for aerial mapping he was equally industrious in other directions. His talks with Campana, and the first assays, had convinced him that his discovery was not only a major one, but that the ore was of a grade and purity which made it suitable for steel making.

He was impatient and he was enthusiastic. He wanted to make sure Rio Tinto was equally so. Early in February 1961, before the State Government had lifted its blanket, he wrote to Robinson to give him a comparison of the U.S. Steel deposit in Canada and the figures compiled by Campana for the Hamersley deposits — a comparison which favoured Hancock’s discovery. He added:

I think we can confidently look for some action (from the government on lifting the blanket) in the next day or so and, at the risk of repeating myself, I would like to emphasise that as I see it we must leave no stone unturned to make certain that we get title to these areas without any further delay.

He was to write many similar letters during the next 12 months.

John Hohnen took over from Robinson as Managing Director a few weeks later, and Hancock urged him to apply for Temporary Reserves covering about 650 square miles.

“It is always possible to come down, but it would be difficult to increase the number after you had made your submission,” Hancock wrote.

On May 30 the West Australian published a list of reserves allocated by the State Government. Included was:

Rio Tinto, in association with Hancock Prospecting Pty Ltd and Wright Prospecting Pty Ltd has received a new search area of 650 sq. miles in the Hamersley Range-Duck Creek area.

Six months later Hancock and Wright proposed to Rio Tinto that application should be made for 17 additional areas, including some of Mt Enid and four at Robe River.

Rio Tinto wasn’t idle, but neither were other companies. In October Rio Tinto received a report that a BHP helicopter had landed on a deposit being drilled by Rio Tinto at Hamersley and that there had also been “some visits by light aircraft which did not land”. The “spies in the skies” era, which was to reach its peak some years later during the nickel boom, had arrived.

In addition to pressing Rio Tinto to apply for additional Temporary Reserves, Hancock was urging the company desperately to secure titles to the areas they were drilling. He believed that there were two reasons for urgency. One was that, when the full extent of the deposits became known the Japanese might well seek contracts at lower prices. And the Western Australian government would extract a higher price.

Somehow, he felt, he wasn’t getting his message through. He wondered if internal jealousies had “watered down” Campana’s reports on their way up to management. He wondered if the thing was so big that the people “down the line” in Rio Tinto couldn’t comprehend it — or were frightened to indicate to the Board what it was going to cost.

So he wrote direct to Rio Tinto’s Chairman in London (Sir Val Duncan). It was a letter — in fact, the first of a number of letters — which, naturally enough, Rio Tinto in Melbourne resented strongly. Duncan probably became accustomed to the bombardment, but there was no way in the world in which he could avoid it.

Hancock was determined that Duncan would “get the message”, but he softened the attack as much as he dared. One letter, for instance, began:

Sorry Val, but here’s another burst!

In March 1962 the Hamersley area welcomed a V.I.P. — although he didn’t look or act like one. This was Tom Price, vice-president of Kaiser Steel. He brought with him Bill Donaldson, the corporation’s geological consultant, and the Australian party included John Hohnen, Campana and Hancock, who was the guide and pilot.

Price was 71, small, energetic and with tremendous drive. Hancock recalls:

He was the first one who really got this thing into perspective.

Despite his age he kept walking ahead of us, hammering the ore-bodies and asking questions. He only had time to have a look at a portion of the field, but the portion he did see was sufficient to establish the proper importance of the field in his mind.

Price asked about tonnages and grades. The tonnages were tremendous, the grades higher than those in many American mines. Price was enthusiastic.

As he was leaving he said: “Good luck to you, boys. But remember that God made man out of a bit of dust. If you can’t make money out of the mountains of iron ore I’ve seen, then God has wasted his time.”

Price died at his desk a few hours after the Hamersley agreement was signed. Mount Tom Price is his memorial in the Pilbara.

In 1962 Duncan came to Perth and Hancock insisted that he would have to offer to build a steel mill if they were going to get title to the temporary reserves. Hancock suggested that two companies should be formed — Hamersley Iron and Hamersley Steel, and pointed out that a levy of a fraction of a penny per ton on the Hamersley reserves would build a steel mill.

This undertaking to build a steel mill was part of the Duncan proposal to the West Australian Government — yet the Premier (Brand) and Industrial Development Minister (Court) both denied in Parliament that it was ever a firm proposal.

In December last year Court (now Deputy Leader of the Opposition) again denied, in a clash with Premier Tonkin, that the proposal existed.

Tonkin: Why did you deny there was a proposal originally?

Court: I denied it because there was not one.

Tonkin: I found it in the Premier’s office … This was a definitie proposal for a steel works.

Court: No it was not.

Tonkin: I will produce the document.

Court: The Premier may do so if he wishes and he may also produce all the information that goes with it.

The Government had completed the original Goldsworth agreement on February 27, 1962, and did not appear keen for any opposition to develop in the matter of iron ore contracts. CRA, now confident that they had very large deposits (although no title to them) began negotiations in Japan.

On November 30, 1962, Mines Minister Griffith wrote to Makoto Watanabe, Commission for Overseas Iron and Steel Manufacturers in Japan:

I confirm that because of undertakings already made between us and because of the ratified Acts of Parliament it is the desire that Tallering Peak and Mt Goldsworthy be given the first priority by both sides, and I would emphasise that no other iron operators than these two companies already mentioned plus Scott River (about which I have already written) have in fact received any mining leases from my Government.

It wasn’t until June 30, 1963, that the Hamersley agreement was signed.

J.F. Moyes, Hancock and Wright (self-published, 1973), pp. 15-23, ch. 3.
With thanks to Gina Rinehart of ANDEV.
More info at LangHancock.info and GinaRinehart.info.

In 1959 the Hawke Labor government was defeated and the Brand government assumed office on April 2. One of the Liberal Party’s pre-election proposals was a “North-West Charter” and Hancock and Wright believed that it might mean a new deal for the Pilbara.

Hancock has had, for many years, a copy of the Liberal Party’s Broad Highway — a statement of Liberal values today. It’s preface states:

Broad Highway is the first of a series of statements on liberal principles and values we honour …

The statements were prepared by the Policy-Research Group which was set up by the Federal Council of the Liberal Party of Australia at its annual meeting in February 1956.

The chairman of the Policy-Research Group was William McMahon M.P.

Hancock has underlined the opening paragraphs in his copy — the paragraphs under the heading “The Liberal Party — What it stands for”. The paragraphs read:

We are apt to take liberty in Australia for granted. Yet it is under constant challenge, and chiefly by those who yearn for the all-powerful State.

Liberalism IS Liberty.

It rejects the notion of the State as the Supreme Master.

It places the highest value upon human personality, which it is the duty of the State to encourage, not to suppress, to strengthen, not to weaken.

Liberalism, because of this, is a positive faith. It believes in the individual. It aims at helping him. It restricts his freedom only to the extent that the proper needs of the nation and community are to be served …

In 1959 Hancock was prepared to believe that these were the things the Liberal Party stood for. It’s not surprising that, after about a dozen years of State Liberal government, he’s become cynical. He’s seen preferment for big companies. He has seen government intimidation of overseas companies who wanted to negotiate with Hancock and Wright. He has seen some of his discoveries — not only iron ore — taken from him and given to powerful interests. And he knows that, had Labor not won the last election, the Liberal Government planned to give two more major discoveries to “friends”.

The Broad Highway, in fact, was a devious route and full of pot-holes.

In April of 1959, though, Hancock and Wright were full of hope.

They had deposits of manganese, blue asbestos and white asbestos. And, seven years earlier, Hancock had discovered what later proved to be a deposit of more than 1000 million tones of iron ore — and which led to the discovery of thousands of millions of tons more.

In the early summer of 1952 Hancock, and his wife, Hope, decided to leave their headquarters at the Nunyerry Asbestos mine and to go south for the summer. Nunyerry was in a gorge, about 35 miles long, in the Chichester Ranges about 80 miles east of Roebourne.

He had built an airstrip in the floor of the gorge so he could fly his Auster in and out — from Mulga Downs or from the Hancock and Wright mineral interests elsewhere in the Pilbara. Without an aircraft the Nunyerry mine was almost inaccessible. At one stage it seemed that packhorses would be the only means of getting the fibre out of the gorge and when the Wet game around November each year even packhorses couldn’t move. The mine would close down.

But it was still dry in the first few days of November 1952. The Sherlock River, which passes through the gorge, didn’t have enough water in it to make a cup of tea. The miners had gone south, and Lang and Hope Hancock climbed into the plane almost too late. As they took off they could see the rain coming — torrents of it. And over the Hamersley Ranges, across which he usually flew “at a fairly substantial altitude in the interests of safety”, there was a barrier of towering cumulus. The Auster could never have got through it.

Hancock could not go back to Nunyerry — the rain and low clouds were building up on all sides. He had to fly below the cloud … skimming lower and lower as they forced him down closer and closer to the steaming red cliffs and the boulder-strewn flat tops of the Hamersleys.

He had flown over this country many times before, but never as low as this. This was the Turner River country and he was somewhere over the source. The water running south in the gorges must join the Turner, so he groped through the gorges following the growing torrent.

Sometimes he was just over the tops of the trees, with the cliffs of the gorges perilously close. The neck of the gorge at the headwaters of the Turner is not more than a dozen wingspans wide, but he flew through it, and, as he did so, he saw that the walls of the gorge were different.

Perhaps it was the rain on them. They were red, but a red he hadn’t seen before. A deep ochre red.

As he flew out into the comparative safety of the Ashburton Valley he was convinced that the walls he had seen were walls of iron.

“At that time I thought it was low-grade,” he recalls.

There was no way of going back while the Wet was on. It wasn’t until April of 1953 that Hancock flew back over the area. He crossed and recrossed the deposit, tracing it for about sixty miles. Convinced that it was a major discovery, but still believing the ore to be lowgrade, he was impatient to get on the ground. He found a place to land in the spinifex and took his first samples.

I realised the size and importance of my discovery, but nothing could be done about it at that moment because all iron ore was under complete export embargo by the Commonwealth Government.

Before this discovery the total known Australian resources of iron ore were 368 million tons. According to official calculations the nation supplies would be exhausted in 70 years — sooner if Australia’s rate of development stepped up.

This figure still stood in 1959 when the Western Australian Government issued a special publication called Bulletin No. 7 listing all the known iron deposits in WA.

It was about the time this bulletin was issued, and soon after the Liberal Government came to power in Western Australia, than Hancock and Wright interested Rio Tinto in looking at their deposits of asbestos (blue and white) and manganese. Hancock and Wright hoped for a massive injection of capital which would lead to the development of the North-West.

The preliminary talks with Rio Tinto were the beginning of a kind of “love-hate” relationship on both sides. There were to be many recriminations, many blunt words, many jealousies. But the long-term result was Hamersley Iron.

By August 1959 Heads of Agreement had been signed between Rio Tinto Australian Exploration Pty Litd and Hancock and Wright were to receive a royalty of 2.5 percent, except in the case of manganese. There Rio Tinto had the option to form a company and Hancock and Wright were to have a 33.33 percent interest with Rio Tinto having the right to buy back a quarter of the partners’ interest within six months of the formation of the company.

In the event none of these things came to fruition.

Rio Tinto decided that the white asbestos at Nunyerry was not a viable proposition and withdrew.

The iron ore mentioned in the Heads of Agreement was not, of course, the ore Hancock had discovered in 1952. It was in the Mt Goldsworthy deposits and the Deepdale limonite areas.

Before the final agreement was signed (in December 1959) Rio Tinto asked that iron ore should be excluded, and this was done. The reason seemed to be that, while Hancock and Wright were confident that their tender for development of Mt Goldsworthy would be accepted, the Government had told Rio Tinto that Hancock and Wright would not necessarily get titles to the iron — these would go to the successful tender.

Rio Tinto decided not the tender jointly with Hancock and Wright. Both parties put in separate tenders — and neither of them were successful.

The manganese venture was no more successful. On December 2, 1959, the West Australia reported:

Rio Tinto expencts to have spent $125,000 by the end of this year on the exploration of manganese deposits in the Pilbara field.

Representatives of the group said in Perth yesterday that the company had options over manganese areas from Northern Minerals Syndicate, D.F.D. Rhodes, Bell Bros. and Hancock and Wright.

A camp is being established at Ripon Hills.

On December 10 Lloyd Marshall of the Daily News visited the Ripon Hills camp where 30 men were working. But less than two months later reported:

Rio Tinto intends to leave its air-conditioned assay village at Ripon Hills temporarily.

They were waiting for the Minister for Mines to give a final decision on the granting of another major mineral lease in the Pilbara. It is understood that the area in question was open when pegged and not covered by the existing Government blanket.

It is certain, however, that if the titles sought by the company are not forthcoming, then Rio Tinto will have no option but to pull out of this state immediately.

Marshall estimated that in exploration and in building the camp Rio Tinto had spent $600,000.

But Rio Tinto did not go back to Ripon Hills. Six months later, in a letter to Wright, Hancock asked: “Why did they waste all the money and not look at the guts of the manganese?”

Why indeed? Proved deposits of ferruginous manganese at Ripon Hills are 60 million tons.

There was now only one major mineral remaining in the original agreement — blue asbestos. And Rio Tinto were never to be allowed to have a proper look at it. C.S.R. had a monopoly, and the Western Australian Government kept it that way.

Blue asbestos had been Hancock and Wright’s first mining venture when their partnership begin in 1938. It wasn’t a mammoth enterprise by any means and its success dependend largely on Hancock’s mechanical expertise and ability to get things done efficiently.

Hancock had first noticed the blue asbestos “floaters” among rocks of the creek bed of Wittenoom Gorge, about 20 miles from his station homestead. Hancock says:

I was out hunting dingoes or playing bushrangers — the kind of things most kids did in the north-west. I was only a youngster at the time and I didn’t know what the fibre was so I told my father and his partner Frank Wittenoom. They told me it was blue asbestos.

Some years later — around 1930 — I began to think about it again and I asked the local Mines Department people what blue asbestos was worth. They told me the price was around 18 pounds ($36) a ton.

I calculated that was less than the cost of transport to the market, let alone mining, so I left it alone.

About 1934 Islwyn Walters, manager of the Asbestos Molybdenum and Tungsten Co. Ltd, came out from England. We were using a specimen of the asbestos as a doorstop on the Mulga Downs homestead verandah. When we told him there was lots of it around he offered to pay 75 pounds ($150) a ton for it.

News travels fast up there, and it wasn’t long before some 200 men were camped in Yampire Gorge gouging out the fibre from the cliff face.

They were a pretty rough lot as you can probably imagine. They’d gamble and pay their debts in fibre. Booze came in by the truckload.

One day a fellow was almost hanged. Another day a throat-cutting attempt was given up only because the knife was too blunt.

The first man to peg a claim was a knockabout bushman, Leo Snell, who borrowed some horses from me and went through Yampire Gorge. But I thought the fibre in Wittenoom Gorge had better prospects for establishing a mine suitable for full-scale commercial development, so I pegged out my own area there.

This was where I built my own plant — around 1938.

The fibre was in a precipitous wall about 300 feet up from the bottom of the gorge. We used to put it in bags and send it down to the floor of the gorge on a flying-fox to be loaded on to donkeys.

We’d put two bags on each donkey. They’d carry it about two miles to a donkey dray and then it would go to a dump outside the gorge. The present town of Wittenoom has been built where we used to dump the fibre.

We had old 30 cwt Chev trucks to take the fibre the 200 miles to Roebourne so it would be shipped to Europe.

It wasn’t all plain sailing, of course. One day the string of donkeys must have been standing on a bull ants’ nest and they stampeded. We spent two days rounding them up and gathering as much of the fibre as we could from the broken bags. It was spread along the floor of the gorge for miles.

For the mine to be successful Hancock needed plant. So he built it himself in the workshop at Mulga Downs. It was at this time this his former schoolmate, E.A. Wright, arrived to spend holidays. They financed the plant together — and Hancock and Wright was born.

By 1943 the mine was showing a profit of about $1,800 a month and the partners decided that, if it were to achieve a bigger share of the world market, it needed more capacity — and that meant more capital. In 1948 C.S.R. took a 51% interest leaving 49% for Hancock and Wright, and the company was named Australian Blue Asbestos.

C.S.R. was to provide additional money to expand the mining operation. Wright became a director of A.B.A. and Hancock was assistant manager — appointments which proved to mean nothing at all. Hancock soon found he had no say in the management and Wright discovered that Board meeting were always held in Melbourne. No travelling expenses to attend meeting were allowed so the six C.S.R. nominated directors made all the decisions.

Hancock and Wright could see the writing on the wall. In 1948 they got out. Says Hancock:

We put into the partnership a proven mine, a tested method of treatment with plant producing a saleable fibre, and an overseas and local market.

C.S.R. got into difficulties which I believe were of their own making. They ruined the business they got from us and eventually got rid of us for about $8,000. A losing deal for us — a losing deal for Western Australia.

The W.A. Government gave C.S.R. a remission of its three-fifths responsibility to pay for the costs of the town in the event of failure, road and sea freight subsidies, a road to Port Sampson and a road to Hedland.

In addition the government promised Australian Blue Asbestos protection for ten years. To implement this promise it imposed a blanket on all areas known to contain, or suspected of containing, asbestos.

All this government aid, however, was to go for nothing.

On December 1, 1966 C.S.R. announced that the Wittenoom mine would close by December 30. The mine had produced asbestos worth $31 million since 1943, but it had lost something like $2.5 million — including about $850,000 in 1966.

Reporting the closure announcement, the West Australian said on December 2:

The State Government has a big stake in Wittenoom.

The outstanding capital debt on Housing Commission homes there is $687,000.

The Treasury has contributed about $225,000 since 1962-63 to a $500,000 diamond drilling programme carried out by A.B.A.

Coastal Shipping Commission freight concessions on asbestos have been worth $382,270 since 1960.

The announcement of the closure, made by CSR general manager Sir James Vernon, said “it was not a pleasant duty to make such a decision” and that “the closure of the mine would represent a small retreat in the advance of settlement in Australia’s North-West.”

The Minister for the North-West (Charles Court) was much more voluble, and sprang to the defence of C.S.R. as well as the Government. He said the Government “had been kept informed” of the company’s difficulties.

When the time came to close the mine it was impracticable to give long periods of notice, he said. The position would have been chaotic. There would have been an immediate exodus of people who wanted to get into other employment quickly …

But Mr Court did not explain why, if the Government “had been kept informed”, it had, in the previous six months, opened a $300,000 hospital and built a $152,000 police station and $51,200 worth of Housing Commission homes.

Even the West Australian was compelled to publish a “methinks he doth protest too much” kind of editorial.

“In which of his many capacities does Mr Court emerge as spokesman and apologist for C.S.R., which should be big enough to stand up for itself,” the West asked.

As Minister for the North-West and Industrial Development he made it appear that his main concern was to justify the company in a move adverse to W.A. interest in both spheres.

… the notice give to the Wittenoom community was brutally short; the reasons it (C.S.R.) has given, through Mr Court, for confining the notice to a month are entirely selfish …

… with Parliament sitting and the Federal election approaching, the Government sat on the information (about the mine closure) for nearly a month instead of bombarding Canberra for special help …

A few days later Australian newspapers public the Wall Street Journal story about the Hamersley Iron opening snub to Hancock. And the West Australian, in an article from Peter Ellery in Wittenoom, published this:

All eyes (in Wittenoom) are on the burly figure of Mr L.G. Hancock, the prospector-pastoralist who began mining blue asbestos in the area at a profit in 1938 and whose initiative in drawing attention to the rich iron-ore deposits nearby led to the formation of Hamersley Iron Pty. Ltd. and the establishment of the towns of Mount Tom Price and Dampier.

Mr Hancock visited Wittenoom three times this week, flying over from his North-West headquarters at Hamersley station with his partner, Mr E.A. Wright …

Long-term Wittenoom residents who would like to stay on believe that his a realist rather than an optimist and this his efforts to keep the blue asbestos industry alive are likely to be more successful than any efforts by the Government.

Less than a week after C.S.R. closed the mine Hancock and Wright telephoned an offer. That day they had a verbal option to buy the mine, the hotel, story, staff housing, power stations, adminisation block and picture theatre, plus C.S.R.’s assets at Point Sampson, 130 miles away.

The cost to Hancock and Wright was around $1.25 million.

***

None of this, of course, did Rio Tinto any good. They were interested in mining blue asbestos, but there didn’t seem any way round the C.S.R. monopoly. The government’s 10-year protection period had long expired, but the protection continued.

On February 23, 1960 — two months after the final Rio Tinto-Hancock and Wright agreement was signed — Hancock had an appointment with Premier Brand. On February 22 he wrote to the Premier outlining points he wished to make.

After the partners’ break-up with C.S.R., Hancock had gone looking for more blue asbestos and had found a deposit in Bee Gorge, not many miles from Wittenoom. He found other deposits, too — all of them outside the area of “known or suspected deposits” which had been blanketed by the Government to protect C.S.R.

Hancock told the Premier:

The Government promised C.S.R. protection for 10 years. We waited for 16 years and then, with a discovery new to the Mines Department and with the prospect of new capital, we sought to get back to the blue asbestos industry.

And what happened? The Department took all the details of our new discovery and the Government has now offered it to C.S.R.

We found other new deposits outside the areas that was under Government blanket. We pegged them and asked the Department for a temporary reserve and a licence to prospect.

The Department pressed us for details of the area and we have the details in confidence against the assurance that we would not lose anything by disclosing them.

Our applications were refused. And the blanker to protect C.S.R. was extended to cover all the areas we had indicated — areas the Government had never suspected of containing asbestos.

It is pretty obvious, Mr Premier, that if we show the government where there is manganese outside the manganese blanket, the blanket is going to be extended. If we discovered diamonds — any minerals in large quantities — on would go a blanket.

Before capital will spend money it must have a title, and that title must commence with the man who finds the mineral.

Hancock sought a compromise. His proposal would not only protect C.S.R.’s investment but would give their mine an additional 60 years of life.

Establish a neutral zone, also of 60 years life, on their extended boundary, and then grant us the rest of the ground we have pegged in the Bee Gorge area.

In 60 years the government can give the neutral zone to whichever company has proved it can make best use of it.

The argument must have been persuasive. Hancock and Wright were allowed to prospect in some areas and Rio Tinto began work. By August 1960 Rio Tinto had discounted three areas because they believed the grade of asbestos was too low. One area remained, and they would look at that later.

Hancock and Wright had been unsuccessful with Rio Tinto in manganese and now blue asbestos. Only iron remained.

C.R. Kelly, “A Modest Farmer looks at the Problems of Structural Change,” Economic Papers, no. 59 (August, 1978), pp. 91-95.

I have been looking forward to talking to a group of economists. People talk of a flock of sheep, a herd of elephants and a grumble of graziers. I have never known the correct term for a group of economists, is it possible to use an eclectic of economists? My Chamber’s dictionary says that one of the many meanings of eclectic is “choosing or borrowing, choosing the best out of everything”. But I have always wanted to talk to such a group so that I can get my own back. None of you know how Eccles has harried me over nearly 9 years. I have a lot of scores to settle.

I am glad that you have asked me to talk about the problems of readjustment. As a farmer I have had to make more than my share of readjustments, and as a politician I have seen how bad governments can be at intervening in the affairs of businessmen.

When I was a member of Parliament, I was asked to talk to an R.S.L. group in the bush. These were not as respectful to their member as a typical Liberal Party branch. One big raw boned bloke said in rather a threatening tone”

The farms in our district are becoming bigger every year and the country towns smaller and sicker. I want to know what you are going to do to stop it?

Then he added sourly that he didn’t want a polished display of political footwork, he wanted a straight answer to his question. I took a quick look around to make sure the door into the supper room was open, made a quick prayer, took a big breath and said bravely that I had quick solutions to both problems. First, the size of the farms in that district were originally about the size that an eight horse team could handle. But when tractors started replacing horses, the farms grew bigger. Then as tractors increased in size, the farms grew bigger again. And if they wanted their farms of the original size, all we had to do was make tractor farming illegal.

Then, realising that I might as well be killed for a sheep as a lamb, I charged on, saying that the little country towns were located where they were and were once health, because the original settlers could not travel far for their groceries and mail in their buggies. And the rail sidings could not be more widely spaced when the wheat was carted with horse-teams. So if they wanted their country towns to be healthy again, all we had to do was to get ride of our cars and trucks.

I must admit they took it well. But, after all, they were farmers, and farmers have had their noses rubbed in the unpleasant facts of change ever since Adam started farming. Farming must continually change as a bucket of worms must continually turn. If either stop, the results are devastating.

I do not pretend that farmers like change. We are a conservative group so we hate it. And most of us hated parting with our horse-teams. Indeed only last year I had a brief hope that we were about to go back to horses again. This was when Mr Fraser said on February 21, and I quote, “Employers are tending to use machines instead of people in the production process and if tariff protection was reduced, the trend would worsen.” When I heard the P.M. say this I thought he was about to urge us to go back to horses again so as to create employment. But evidently he was only thinking about secondary industry.

Farmers are used to change, we had to change or go broke. And the government has been helping us change with its farm reconstruction legislation. But the government has not told us what to grow. It is now rather belatedly examining how it can help secondary industry adapt to meet the changing situation. My purpose is to look at one narrow aspect of this problem, how deep should be the government’s involvement in structural change in secondary industry?

I should first ask this question of secondary industry leaders. I am well aware of the deep dedication of these gentlemen to the free enterprise philosophy. They are a bit like the Liberal Party in this. When the Liberals have a big get together we usually spend the first hour worshipping at the free enterprise shrine. If we are lucky we may perhaps hear the P.M. himself say, as he said in 1977:

People must question their own demands on government. Governments must foster this awareness and tell the truth more plainly. When governments promise any programmes, they must make it plain that all the people of Australia must pay. The day of the cargo cult must be banished.

Having got these fine flowing philosophic phrases out of his system, he often goes on to assure secondary industry that they can count on getting the protection that fits their need, irrespective of the effect on the rest of us. This always seems to be a queer way of getting rid of the cargo cult.

Secondary industry spokesmen are equally eloquent about their deep devotion to free enterprise. I have been to many of their seminars. They perhaps spend rather longer polishing their private enterprise halos, but the balance of the programme is usually devoted to twisting the government’s arm so as to persuade it to give them an even bigger tariff subsidy at the expense of the rest of us.

But sometimes they become more specific as to what they want from the government they so often despise. “We will accept that there is logic in encouraging secondary industry to leave the highly protected sector,” their leaders say bravely, “but first the government must tell us into which other sectors we should move. We want to government to tell us what to do next.”

Let me give an example. The Australian Confederation of Apparel Manufacturers (A.C.A.M.) says:

It casts grave doubts upon the intelligence of the architects of that plan (the tariff review) or perhaps reflects upon their indifference towards the workforce, that they could make the absurd mistake of recommending the reduction of high protection industries before ascertaining if there were sufficient low protection industries within the Australian economy to provide alternative jobs for the workers who were retrenched.

A.C.A.M. is not noted for the strength of its intellect, though its ability to kick in the ruck is unquestioned. The more prestigious A.I.D.A., whose research officer, Dr Norman, has spoken to you earlier today, are more careful with their language, but if you winnow carefully through its new gospel, Protection in Perspective, you will find this statement (made about the Jackson Report, I think):

There is inadequate or no provision for positive identification and encouragement of new industry development which will be vital to continued and increasing high living standards in a secure and prosperous Australia. This is left to chance.

I envy the stately splendour of the prose, but what I find irritating is the implied criticism that things are to be left to chance. What they are really worried about is that decisions are going to be left to the market to make, that free enterprise is to be encouraged to be enterprising, this being the system which secondary industry worships so ostentatiously before lunch. But after lunch they want the government to tell them what to do next, not how to do it perhaps, though that too would be nice, but what to do.

I have no ideological objection to government direction of this kind, and if the government was good at it I would be happy. But they almost always make a mess of it. If the government is to tell industry what to do next, the government must assess what the supply and demand for a product is going to be in, say, 5 years time. And that advice will be given to the government by people who work for the government. But any civil servant who can correctly foretell the supply and demand situation for any product for even one year ahead will not for long be working for the government, he is shortly sitting in the South of France with his feet in a buck of champagne! When I first became an M.P. my neighbours watched me because they knew that I would be close to the wise ones in Canberra. When I sold cattle, so did they. But 19 years later, when I sold cattle, they bought. The government has no well of wisdom on which to draw, it is just as likely to be wrong as the rest of us. If you want an example of what a mess the government can make of its planning, look at our car industry.

But even when the government is right, as it will be sometimes, troubles will still loom. There will always be some manufacturers who are naturally messers in the same way as there are some farmers who are not good at farming. But these messers, when things start to go badly for them, will blame their failure on the government:

You told us to produce what-nots and we are not even recovering the costs of production. We are doing what you told us to do so you must look after us.

I dread government intervention of this kind, because I know from experience that governments are clay in the hands of pressure to stop to “weak-uns from deeing”. This is a process absolutely essential to the health of capitalism.

And it is all very well to sneer at the “nervous Nellies” in Parliament, but resisting sentimental pressure is not easy, not as easy as it used to be, since TV has hit us. For instance, if a factory was going broke because it was making a mess doing what the government told it to do, the local member would have to contend with the TV camera showing a poignant picture of the closed factory gates, with a housewife wiping a tear or two from her eyes, and with two bare-footed children holding her hands. She would say with a sob in her voice:

Is the government going to stand idly by while my husband is flung on to the scrapheap? And what is our local member doing about it?

Governments don’t make a mess of things because they mean to or because their intentions are not honourable and good. But they find it increasingly difficult to let the weak ones die. Again the car industry is a sad warning. Even the government has known for years that the car industry as now structured is hopelessly inefficient, that some units will have to die to allow the remainder to have the throughput necessary for economic production. But each time the industry seems about to take the necessary medicine, to take the painful readjustments, the silly kind-hearted government takes the medicine cup away.

So I know what the secondary industry spokesmen would say if I asked them how they want the government to help with reconstruction. They will beg the government to tell them what to do next. I know, and am glad, that there are many manufacturers who despise this philosophy, but, in spite of this, I say with infinite sadness, that it is the dependence of industry on the government that troubles me most. I suppose that this is inevitable. The Bridgen Committee recognised this tendency fifty years ago, and I quote from the Report:

The most disquieting effect of the tariff has been the stimulus it has given to demands for government assistance of all kinds, with the consequent demoralising effect upon self-reliant efficiency throughout all forms of production.

But I have forgotten where I am, that I am speaking to an eclectic of economists. What do you economists think about government intervention of this kind? There may be a small number of you working for private firms and I know from past experience what will happen. You won’t say anything to me publicly, but some of you will edge up to me privately and admit, out of the side of your mouths, that you know that I am right but you cannot get your directors to get out on the end of a limb in case the government doesn’t like it.

Some of you will be employed by the government and you will be too wise and careful to say anything to me at all. But perhaps in the still of the night you will recall Alan Peacock’s Wincott Memorial Lecture, where he is discussing the way civil servant economists rationalise the abandonment of their belief in the market:

Reluctantly, so that pragmatic argument continues, the only solution will be to extend selective intervention by government. Indeed, in an international economy riddled with externalities, this will be the only prudent way to ensure that private enterprise will be able to function efficiently at all. Paradoxically, therefore, selectivity will be the principal means of preserving rather than destroying the market economy.

Perhaps some of you will believe your protestations.

To all of you, including old Eccles if he is listening, I have a message passed on by Milton Friedman. I quote from From Galbraith to Economic Freedom:

There is nothing that produces jobs for economists like government controls and government intervention. And all economists are therefore schizophrenic: their discipline, derived from Adam Smith, leads them to favour the market; self-interest leads them to favour intervention. And in large part the profession has been led to reconcile these two opposing forces by being in favour of the market in general but opposed to it in particular. We are very clever at finding “special cases” — there are external effects, there are monopolies, there are imperfections in the market; therefore we can have our cake and eat it. We can be in favour of the free market and we can at the same time promote these separate interventions that promote our private interest by providing jobs for economists.

Now I would never have dared to say that to you, but I am quite brave when I can shelter behind Friedman. And Eccles can like it or lump it.