History as if policy mattered On tariffs and immigration, party reputations don’t match their records Richard Allsop

wo of the most fundamental lib- Under Jim Scullin’s Labor govern- negotiating assisted immigration agree- eral freedoms are the free move- ment, the number of assisted immigrants ments with many other countries. Broad- ment of people and goods across was slashed from 13,000 in 1929 to 175 ening the range of countries from which Tborders. In Australian politics, individuals in 1932, admittedly in the period of the migrants came was not something which of liberal persuasion have always struggled depression. When, in 1938, the United appealed to Labor. Their 1950s leader to find one side of politics that has reliably Party Prime Minister Joe Lyons ‘Doc’ Evatt campaigned for the proportion supported both increased immigration and announced the resumption of assisted Brit- of British migrants to be raised from 50 to lower tariffs at the same time. However, our ish migration, the ALP was quick to voice 60 per cent, claiming that Mediterranean two major political parties have had such a its traditional opposition. migrants lacked skills and those from East- remarkably consistent record that one can It is not only in increasing numbers ern Europeans were right-wingers. All suf- confidently say: that liberal politicians were better, but also fered in Evatt’s eyes by being Catholic. • immigration will always be higher un- in having a more tolerant attitude to non- Indeed, it was a point of distinction der a Liberal government and; white immigration. The early federal parlia- between the ALP and the Democratic La- ment’s soundest free trader, Bruce Smith, bor Party that the supposedly more right • tariffs will always be lower under a La- was also a rare opponent of the White Aus- wing party was the one which wished to get bor government. tralia Policy. Prime Minister Stanley Mel- rid of the White Australia Policy. As aboli- This may seem counter-intuitive, but the bourne Bruce in the 1920s eased restric- tion of the policy began to gain traction, the lesson of history is clear. When it comes tions on the immigration of Indian wives, ALP went as far as expelling several party to the movement of people and goods the while the Lyons government eased restric- members in 1962 for supporting the Immi- Liberal Party is the party of social liberal- tions on Chinese migration in 1934, allow- gration Reform Association. ism and the Labor Party is the party of eco- ing the migration of Chinese chefs and the It was under the Holt government that nomic liberalism. Of course there have been introduction of assistants to other Chinese the White Australia Policy was effectively exceptions—most notably the post-war mi- businesses. ended and it was also the Liberal govern- gration expansion commenced under the Of course, it was a Labor government ments of the late 1960s that boosted immi- Chifley Labor government, but this was and its Immigration Minister, Arthur Cal- gration numbers to new record highs, peak- certainly an exception to the general rule. well which instigated the major post-war ing at 185,099 permanent settler arrivals in After all, it was the early Australian La- immigration program. However, it should 1969-70. bor Party (ALP) that was one of the stron- be noted that Calwell had to overcome sig- While the Whitlam government is re- gest advocates of the White Australia Policy nificant opposition in cabinet, in particular membered for removing the last vestiges of and their opposition to coloured immigra- to the inclusion of large numbers of east- the White Australia Policy, less readily re- tion extended, at many times, to all immi- ern European refugees. Calwell himself re- called is the fact that one of their first acts gration. During the 1920s Labor branded mained a supporter of the White Australia was to cut the planned immigration intake the Bruce-Page Nationalist government’s Policy and was ruthless in prosecuting indi- for 1972-73 from 140,000 to 110,000. expansionist immigration policy as a capi- vidual cases. While the Liberal opposition Then, when the government’s economic talist device to flood the labour market, pro- gave full support to expanding the immigra- policies began to see rises in unemploy- vide cheap labour to sweating employers, tion program, they also attacked Calwell for ment, they had no compunction in further and reduce working class living standards. his inhumanity to post-war Asian refugees. cutting the intake to a measly 50,000. And On coming to power in 1949, the as if to emphasise just how anti-immigrant Menzies government increased both the they were, the Whitlam government even Richard Allsop is a Research Fellow overall numbers of incoming migrants and abolished the Department of Immigration. with the Institute of Public Affairs. the range of source countries, the latter by Immigration levels were rebuilt under

22 IPA Review | March 2008 www.ipa.org.au As if to emphasise just how anti-immigrant they were, the Whitlam government even abolished the Department of Immigration.

Malcolm Fraser’s Liberal government with seas born went above 50 per cent for the policy response to the Depression. The both strong humanitarian intakes of Viet- first time. And as well as increasing overall next Labor governments of Curtin and namese boat people and, for at least a peri- numbers, the Howard government progres- Chifley did not make major alterations to od in 1980-82, a boost in skilled migration. sively increased the refugee intake from tariff policy and their 1945 White Paper on Immigration was back to almost 120,000 3,802 in 1999-2000 to 6,022 in 2005-06. employment was quite moderate in tone on in 1981-82. As journalist George Megalogenis, issues of protection for Australian industry. Gough Whitlam was a virulent op- sagely commented in his 2006 book The Menzies is remembered as the founder ponent of letting Vietnamese refugees into Howard Factor ‘the former Hansonite of the current Liberal Party. He also left Australia, only allowing in one thousand belt… think Howard is keeping out all the a legacy of protectionism that still has not in 1975 (the year of the fall of Saigon) and foreigners, when he is bringing them here at been completely eradicated from his party. continuing to criticise their arrival in op- a rate never contemplated’. The 1950s and 1960s were generally de- position. There were some elements within The past three coalition governments cades of world trade liberalisation and so the Labor Party who supported a more have had final (that is, their last full finan- Australia’s protectionism meant that by compassionate policy, but Whitlam reject- cial year in power) immigration numbers 1970 it had the second highest tariffs in the ed the refugees (in a similar manner to Evatt of 132,719 (McMahon), 118,031 (Fraser) industrialised world—only behind New in the 1950s) largely it seems on the basis and 140,148 (Howard); the last two Labor Zealand. that they were likely to be Liberal voters. governments have had 89,147 (Whitlam) In 1952, general import restrictions He was even wrong about that. Whitlam and 87,428 (Keating). The pattern is clear. were introduced, and an elaborate adminis- was not alone in holding this view in La- While its view on immigration was trative scheme of import controls and quo- bor circles—waterside workers in Darwin clear at the time of federation, the Labor tas was established under the Department went on strike in protest at the arrival of the Party vacillated between free trade and pro- of Trade and Customs. This was meant refugees. tectionism; its members tending to follow to be a short term reaction to a balance Labor’s next Prime Minister, Bob the prevailing orthodoxy in their home of payments crisis, but as restrictions were Hawke, proclaimed himself to be a high colonies. One of the key reasons for the gradually removed, and import licensing immigration man. Several years of low im- triumph of protectionism in the first fed- abolished in 1960, the demands for tariff migration in the first half of his Prime Min- eral decade was the success the Protectionist protection continually increased. istership might have called this into ques- Party had in co-opting Labor to its cause. While the ‘protection all round’ ethos tion, but strong increases in the late 1980s This strategy triumphed in the New Protec- of the time is most associated with Country probably justified his claims. Nevertheless, tion of 1908, which saw a link established Party leader John McEwen (to the extent of normal Labor form was re-established between industry protection and the pay- being known as McEwenism), the Liberal when Paul Keating succeeded Hawke in ment of protected wages to the employees Party were generally willing colleagues. The late 1991. It has been claimed that mav- in those industries. one standout opponent was Bert Kelly, who erick right-winger, Graeme Campbell, After the 1908 settlement of the tariff tirelessly raised the arguments of why pro- changed his vote from Hawke to Keating question, the first major increases to tariffs tection was actually harming in the leadership ballot largely because he came during the Nationalist governments economy. By the end of the 23 years of thought Keating would cut immigration. of Hughes and Bruce, with the average tar- coalition rule, Prime Minister Billy McMa- He was not to be disappointed, with the iff level almost doubling during the 1920s. hon had been showing some signs of agree- reduction in incoming migrants of 31,000 Indeed, it was under Hughes in 1921 that ing with Kelly, but as Leon Glezer wrote in in 1992-93—a thirty per cent decrease, and the Tariff Board was established, a body his 1982 survey Tariff Politics: Australian the largest cut since Whitlam. which for the first forty years of its exis- Policy Making 1960-1980, the next Liberal The Howard government, like all its tence was avowedly protectionist in nature. prime minister, , had ‘party Liberal predecessors was a high immigra- Of course, by the 1920s the Country Party and business links that nurtured the manu- tion government, particularly in its latter had arrived on the political landscape, rein- facturers’ preferences within the party’. stages, topping 140,000 in its final full year forcing the protectionist nature of the non- The one bright spot in this protec- 2006-07. It was under Howard that, for the Labor parties. tionist era was the Whitlam government’s first time since federation, the overseas born Just as Calwell and Hawke presented across-the-board 25 per cent cut in tariffs in proportion of the population exceeded 24 a degree of Labor exceptionalism on immi- 1973. The political problems that this lib- per cent and it was also under Howard that gration, so did Scullin on tariffs. Massive eralisation created led to some back-sliding the non-European component of the over- increases in tariffs were part of his failed in the government’s later days. www.ipa.org.au IPA Review | March 2008 23 True to the Liberal Party’s historic form, the Howard government delayed the implementation of further tariff reductions.

Other than the brief Whitlam inter- trade policy than its coalition predecessors. Emancipation. Cobden believed that the lude, there were Liberal governments in It maintained the Labor tariff reductions on ‘unlikely’ government had the advantage Australia for 31 out of 34 years to 1983. 1 July, 1996 and rarely moved in a more when implementing good reform of being They bequeathed an effective rate of protec- protectionist direction. sure of the support of the honest advocates tion for manufacturing that averaged 19 per However, more true to historic form, of the policy they adopted, even though cent, with the highest rates in clothing and the Howard government did delay the im- they were nominally in the ranks of their footwear (192 per cent) and textiles (68 per plementation of some further tariff reduc- opponents. cent). Remarkably, Australia was the only tions. In 2000, it vetoed the Productivity This is much the role that the Liberal OECD country where the average tariff on Commission recommendation to reduce opposition played between 1983 and 1996 imports increased between 1965 and 1985. the general tariff from five per cent to zero in supporting much of the economic reform In that same period, Finland, which like and also delayed—to what has proved to be (including lowering tariffs) of the Hawke Australia in 1965 had an average tariff of beyond its own life—further cuts to motor and Keating governments. That period around 10 per cent, had by 1985 reduced it vehicle and textile, clothing and footwear reinforced what now needs to be under- to one per cent. (TCF) tariffs. Under the current policy, stood by every member of the new federal The Hawke and Keating governments passenger motor vehicle tariffs and some opposition—that supporting good policy is ripped up the protectionist model that had TCFs will fall to five per cent in 2010; the as much the obligation of an opposition as been an inherent part of the Australian settle- remaining TCFs will be reduced to five per it is of a government. ment since federation. The average rate of cent in 2015. One hopes that the Rudd Government protection fell to six per cent in 1992 and fur- The phenomenon of the ‘unlikely’ par- can overturn a century of Labor history and ther ambitious changes announced in their ty initiating reform is not new. The great- continue our current high immigration March 1991 industry policy saw it planned est of all advocates of free trade, Richard intake. At the very least, it will hopefully to fall to under three per cent in 2000. Cobden, observed late in his life that it had maintain the tariff-cutting zest of the Whit- Just as the Hawke government fol- been no coincidence that it had been under lam and Hawke/Keating governments. It is lowed more liberal policies on immigration the unlikely stewardship of Robert Peel that perhaps just as important that the opposi- than its Labor predecessors, so the Howard the Corn Laws were repealed, as earlier the tion supports them. government also was much more liberal on Duke of Wellington had overseen Catholic R

24 IPA Review | March 2008 www.ipa.org.au