Robert Menzies: December 1949 – January 1966

The Hon John Howard OM AC, was Prime Minister from March 1996 to December 2007. Since retirement from politics, John Howard has proved to be a successful author with his best selling autobiography Lazarus Rising. In 2014, John Howard published a second book – The Menzies Era: The Years that Shaped Australia – on the politics of his lifetime taking a comprehensive look at the era that encompassed the success of his Liberal predecessor Sir Robert Menzies, Australia’s longest serving prime minister in a record second stint in the Lodge of an unbroken sixteen years. In John Howard’s view, the Menzies years gave birth to modern Australia. John Howard addressed The Sydney Institute on Wednesday 8 October 2014. The paper which follows is taken from an edited transcript.

ROBERT MENZIES: DECEMBER 1949 – JANUARY 1966

JOHN HOWARD

Can I start by thanking The Sydney Institute again, for providing an opportunity for me to talk about a book I’ve written. More importantly, it gives me an opportunity to salute the work of The Sydney Institute. Running what is colloquially called a think tank for a very very long period of time has been quite an achievement by Gerard and Anne Henderson and I compliment them for it. It’s a very objective body. It provides a forum of all shades of political opinion, within reason of course. And one of the things that I say in this book, and one of the things that I always felt very strongly was a characteristic of Bob Menzies, isthat he was very interested in the battle of ideas. Politics is, in the end, a battle of ideas. And the contest of ideas is the contest, more than anything else, that shapes our society.

This book is not a personal biography of Robert Gordon Menzies. It is certainly not a hagiography of Robert Gordon Menzies. It is an attempt, albeit from a position of natural respect, regard and admiration, to assess a period in Australian history which was dominated by one man in a way that no person since Federation has dominated any period in Australian politics.

The Menzies era deserves a proper and fair assessment for a number of reasons. Menzies, of course, was the longest serving prime minister in Australian history. He won seven elections. The period covered by this book starts in 1949 and ends in 1972 with Gough Whitlam’s election as prime minister, thus ending 23 years of unbroken Coalition government – a longevity in government that will not, in my view, ever be repeated in Australia’s experience. We won’t have, again, a party in power for that long.

What the book endeavours to do is to touch on what I regard as the major events, personalities and shifts in public opinion and public attitudes in Australia during the time that Menzies was prime minister between 1949 and 1966. I cover the governments of his three Liberal successors – Harold Holt, John Gorton and Bill McMahon – and end, appropriately, with a chapter entitled “It’s time – but only just” in 1972.

What I have endeavoured to do in this book is to demolish the myths about Australian politics. One of the myths is that although Gough Whitlam’s win in 1972 was a handsome one, because he ended 23 years of Coalition government, it wasn’t a very emphatic win. His margin was only 9 seats. Let me say, immediately, that you will find the last chapter complimentary of Gough Whitlam because I thought he was a very successful opposition leader and he did a remarkable thing in getting the Labor Party fit for government in 1972.

The first chapter in the book is called “At the pictures in Earlwood” and that’s because I grew up in Earlwood and was at the pictures with my mother and father and one of my older brothers when I first learnt that Menzies was likely to become the next Prime Minister. During the second film, an American war movie called Command Decision, there was a little slide that said “LCP takes early poll lead”. And when we got home my eldest brother Wal was sitting in front of our big radio in the lounge room. He said, “Menzies has won and the biggest swing has been in Queensland.”

Years later, when I won in 1996, the biggest swing was in Queensland. Queensland was always very generous to our side of politics, although they missed the beat rather badly in 2007 but that is another matter.

The purpose of that opening chapter is to describe what I remember about Australia in 1949. I was then 10 years of age. One of the reasons I wanted to write this book is that the period of the Menzies era coincided neatly with my own acquaintance, at the age of 10, with politics. I remember there was a vacant allotment or paddock across the road from our house in Earlwood. And the local Labor Party campaign had erected a shed there. The local Labor member then was a fellow called Dan Mulcahy and we were in the federal seat of Lang. Dan Mulcahy was a very prosperous and successful publican who lived in the eastern suburbs of Sydney. The Liberals used to say he only came at election time and shouted the bar in order to get re-elected. Now that was very unfair because I think from what I’ve read and been told he was a very conscientious local member.

From then on, I acquired a tremendous interest in politics. All of the events that are canvassed in this book are ones that I remember from 1949 onwards, from my own childhood, young adulthood and so forth. I do have a couple of chapters that start with Robert Menzies’ early life in Jeparit and his rapid rise in politics. He, of course, became prime Minister in 1939 after the death of Joseph Lyons and then, because of crumbling internal support, he felt obliged to resign in 1941. He was replaced by Arthur Fadden who lasted for 40 days and 40 nights. He, in turn, as a result of a baton change, was replaced by Labor’s John Curtin. Curtin then went on to win a very handsome, indeed overwhelming, victory in 1943.

One of the things that is forgotten about Gough Whitlam’s win in 1972, is that not only did he win government for the Labor Party for the first time in 23 years, but it also was the first time in 43 years that you had a Labor leader winning at the polls from Opposition. Because Curtin had taken office in 1941, not after an election but as a result of the two independents shifting their support for the Fadden Government.

I have traced Menzies’ remarkable resurrection, his formation of the Liberal Party of Australia. And the Liberal Party of Australia, if you judge by elections won, has been the most successful political party in Australia’s history. Menzies rated that his greatest political achievement. And there’s not any doubt about that. Menzies had great achievements as a statesman and a leader, which is separate from his political achievements, although not unrelated.

Menzies went on to win in 1949. One of the things I’ve dwelt on quite heavily because I think historically it’s very important and its significance is often overlooked, is the titanic struggle between Ben Chifley and Menzies over the attempt by Chifley to nationalise the private trading banks. Now that failed, it was struck down in the High Court and that decision was confirmed by the Privy Council. But it’s worth reflecting for a moment what might have been the nature of post-war Australia economically if all the banks had been in the hands of the government. The structure and nature and direction of our economy would have been very very different.

The major motivation for writing this book was my belief that the contribution of that Menzies period to the nature of modern Australia has been, how shall I put it, not so much discounted but overlooked or undervalued. If you look at the character of modern Australia there is so much of it that can be traced back to what was achieved during that period, or what occurred during that period. Not all of it, and we’re a different country now to what we were in 1949, 1960, 1970 indeed, 1980. But some of the fundamentals are ones that you can trace back to the Menzies period.

There’s not much doubt that the 1950s has become a much derided decade and a much sneered at decade, because of its claimed social conformity and stultifying social repression and so forth. The 1950s is really the first decade of the twentieth century in which large numbers of average Australians of working class, and lower middle class Australians, really got a share of the good life. Let me illustrate. In 1949, home ownership in Australia was just under 50 per cent. By 1970, it was close to 70 per cent. Now that was an extraordinary transformation.

Interestingly enough, through all of that period it was possible to service a housing loan at a medium cost in one of the capital cities of Australia out of one income. And you only have to state that to understand how much the transformation has been since then in relation to the affordability of housing and also to remind ourselves of what an enormous change occurred during that period. It was a time of extraordinarily low unemployment. Unemployment in 1972 was just under 2 per cent. It was a time of very strong economic growth. It was also a time of course when, particularly in the 1950s – and I was very conscious of this because my father owned a garage, or a service station as they now call them – where there was an absolute explosion in owning cars. In 1950, the number of Australians who owned cars was quite small. By 1955 it had expanded in an exponential way.

Mentioning these things, of course, I acknowledge not all of these developments were entirely due to actions of the government. Some of them were a natural product of the bounce back of the world economy and the Australian economy as a result of the end of World War II. But many of them were due to the government. Many of the changes were due to the sense of stability and prosperity that the government created. And also due to the capacity of the government to respond to unexpected economic developments.

One of the tests – and I can say this from my own experience in government – of a successful government is how you respond when you get an unexpected development. For example, we faced unexpected developments with the Asian financial meltdown in 1997-98. The Hawke Government faced adverse developments with the terms of trade challenge and crisis in the mid-1980s. On both of those occasions I think the two governments – one of Coalition disposition, the other of Labor identity – responded correctly and effectively to those challenges. Menzies faced a big challenge at the time of the Korean War. There was a huge explosion of inflation because of the wool boom. The Americans bought up all our wool for uniforms for the Korean War. Inflation went to 23 per cent in one year. Because of a combination of measures Australia survived – one of them being an ingenious temporary tax system that Treasurer Arthur Fadden introduced which creamed off some of the grazier’s profits from selling wool and applied it against their future tax liabilities. That was his alternative to agreeing to an appreciation of the Australian pound which was being advocated by the Treasury and also by other people in the government.

The other contribution that took inflation out of the system was an inspired decision by the Conciliation and Arbitration Court, as it was then called, in the early 1950s to suspend cost of living adjustments, which guaranteed that the inflation burst would not be built into the wage fixation system.

Much of the book concerns issues of what we now call national security. Throughout the whole of this period, indeed right up until the late 1960s, the issue that dominated the world more than anything else was fear of communism. You talk about communism now to people under the age of 50 and they look at you with blank disbelief. There are now only five countries in the world that call themselves communist. One of them is of course China and more than 50 per cent of China’s GDP is in private hands. But, nonetheless, it is a self-described communist country. And it is impossible to understand the politics of this period, without understanding the communist issue. And understanding the extraordinary success Menzies had in capturing the mood of the period in relation to communism and also the way in which he effectively exploited it against his Labor opponents.

I deal extensively with the Communist Party Referendum in 1951 in which a couple of people quite close to me get honourable mentions. One of them is my mother who for the first and only time in her life, as I understand it, voted differently from my father. They were both staunch Liberals but mum didn’t agree with the referendum proposal of Menzies to ban the Communist Party. Not that she had any sympathy for the Community Party she just didn’t like the idea of banning a political party. And so they agreed to go their separate ways and I remember a rather tense but short exchange over the kitchen table about the different voting intentions of my parents. And the other person, of course, who voted no (and it was his first ever vote) was my friend Michael Baume who is here tonight and who indicated to me that he would be very happy if I made that extraordinary disclosure in my book.

I deal in some detail with the great Labor split of 1955 which cast a very long shadow over the Labor Party and indeed over Australian politics. The chapter on the election in 1961 where Menzies almost lost and was elected with a majority of only two (in fact just one after the speaker was selected) is titled “Saved by Santamaria” because there’s no doubt that the faithful flow of Democratic Labor Party preferences in Victoria saved the Menzies Government from otherwise certain defeat at that election.

The book also deals in some detail with Australia’s relations with Asia. One of the many myths about recent Australian politics is the proposition that our engagement with the Asian region really only began in earnest 30 or 40 years ago. It’s important to make the observation that in two very crucial areas, engagement with Asia began in the Menzies years. The first, of course, was the inauguration of the Colombo Plan. You will all remember the Colombo Plan whereby many students from Asian countries came to Australian Universities at a time when the university infrastructure of most Asian countries was very poor. The scheme has had a lasting and beneficial impact on our relations with many countries.

The other very important event was the signing of the Commerce Agreement with Japan in 1957. And that was only 12 years after the end of World War II and feelings towards the Japanese in Australia, twelve years after the end of World War II, was still very bitter and intense. Despite that, the Menzies Government pressed ahead and negotiated that agreement.

It’s correct to say that the person, more than anybody else in the government, who was responsible for the Commerce Agreement with Japan in 1957 was John McEwen, the Trade Minister and the year after the Agreement was signed, the person who became the deputy prime minister and leader of the Country Party. There’s no doubt in my mind that McEwen was far and away the most influential figure in the Menzies years apart from Menzies himself. The foresight of that agreement is quite remarkable because it was signed in 1957, which was also the year in which the Treaty of Rome was signed. The Treaty of Rome was the foundation document of the European Common Market and ultimately the foundation document of the European Union.

Although we didn’t start selling our resources in earnest to Japan until some years after that Agreement was signed, it established a basis of goodwill and a gateway into that country so that when we discovered resources in Western Australia – iron ore and the like – we were able to enter into very fruitful negotiations and understandings with the Japanese. Japan, over the years, has been our best and most faithful customer in Asia. By 1970, Japan had well and truly replaced Britain as our principle export destination.

The foresight of McEwen and Menzies at that time was remarkable. The Agreement with Japan was opposed by the Labor Party. Evatt made a xenophobic speech about threats to Australian jobs and the like. In fact, in some respects, his opposition to it was fiercer than that of the Returned Soldiers League. Although many sections of the RSL were unhappy about it, the national leadership of the RSL at that time showed a great deal of foresight.

It is important to put such matters in the balance when you’re looking at our relations with Asia. I acknowledge, of course, that further on in relation to the recognition of China, the recognition of Beijing as the legitimate government of China, that Gough Whitlam particularly as a result of his thoughtful visit to China in the early 1970s showed a lot more foresight on that issue and wrong footed the Coalition government at the time. But when you’re looking at the balance of our moves to Asia, it is fair to keep in mind the enormous significance of what was done in relation to the Colombo Plan and the 1957 Trade Agreement with Japan.

There are a couple of non-economic and non-national security areas where Menzies was very significant. In the area of education, two things for which Menzies should be long remembered were the initiatives in the late 1950s, a result of the Murray report, of massively increasing Commonwealth assistance for universities. When I was at university, between 1957 and 1961, it was only a relatively small percentage of the Australian population that had the opportunity of a tertiary education. As a result of Menzies’ initiatives in that area, those opportunities were significantly expanded.

The other big breakthrough, of course, was in the area of state aid for independent, predominantly Catholic, schools. This was an issue that had been festering for a very long time. The decision that Menzies took in the 1963 election to offer, as an initial contribution of state aid, 5 million pounds for the construction of new science blocks to be made available without discrimination as between government and independent schools was a breakthrough.

It was an extraordinarily courageous initiative at the time. Particularly as the Opposition Labor Party enjoyed overwhelming electoral support from people of Irish Catholic background in Australia. Not because of any religious principles or religious considerations but simply because historically that section of the population had been more heavily identified with the working class and naturally had supported the Labor Party. It was extraordinary when I looked back on it and thought about it. I lived through those times and was involved with some of the debates inside my own party about it. It took – as Menzies called himself – a simple Presbyterian to initiate such a giant breakthrough on an issue which had contributed to deep sectarian feeling in our community and now, thankfully, has disappeared almost completely from our society. The Menzies education grants to non government schools after 1963 were a very significant breakthrough.

Another often forgotten initiative of Menzies of the social dimension was, for the first time, to provide government assistance to non-government, largely church, organisations that provided aged care facilities. It was during those Menzies years in the 1950s that the first Aged Persons Assistance legislation was inaugurated.

The longest chapter in the book is about the Vietnam War because the Vietnam War was the most divisive, difficult, agonising issue that Australia experienced during that period. I indicate, in the book, that in the context in which the decision was taken, that if I had been in Menzies position in 1965 I’d have taken the same decision that he took. It was an issue that did divide the Australian community; it was an issue where Arthur Calwell’s speech in 1965 opposing the dispatch of an infantry battalion was demonstrated in the fullness of time to have been remarkably prescient, as he said that he – among other things – was opposed to the decision because he did not want to see America humiliated in Vietnam. Of course, the reality was that when the decision was taken to commit our forces, nobody imagined that America would be anything other than victorious. It’s worth remembering, and many of you in the room who lived through that period will understand the import of that. It’s also worth remembering that, in the early years, the decision was warmly supported in the Australian community. Harold Holt’s victory in 1966 over Arthur Calwell and the Labor Party was overwhelming. One of the principle reasons for that was the public’s view that the decision that had been taken to commit our forces to Vietnam was correct.

I detail briefly the prime ministerships of Harold Holt, John Gorton and Bill McMahon. The Liberal Party, after Holt’s sudden death on the 17 December 1967, entered into a period of considerable instability. I remember those events very well. I was not in parliament but I was an active member of the Liberal Party. I didn’t want Gorton to succeed Holt; I wanted Hasluck to succeed Holt. But I have to confess, as the years went by and I got to know him more, particularly after I’d become the prime minister, I developed a – what perhaps some might call – a retrospective regard, even affection, for some of the characteristics of John Gorton. It’s fair to say that when he was elected there was a sense of excitement in the Australian community. There was his palpable Australian nationalism. I have titled the chapter on him as “The Tory Larrikin” because he was an interesting combination. A man who had very traditional views on lots of things but also had a demeanour that was, as he called it himself, Australian to the boot heels. But he didn’t understand how important the relationship between a prime minister and his immediate colleagues was to the maintenance of the prime minister’s hold on power.

I have to say, based a little bit on field evidence of my own and others, that the relationship between the prime minister and the people he immediately leads is about the most important relationship that the Prime Minister can have. If you lose the confidence of the people immediately around you, you fall into not only error but also great difficulty. Harold Holt was somebody who demonstrated very clearly the priority he placed on our relations with Asia. He was probably the first prime minister of Australia to have visited countries in our region before he visited Washington or London. Later prime ministers have followed that, including myself, visiting capitals in our region before visiting London and Washington. Not that Holt, or I, had any objection to Washington or London. They’re terrific places to visit. But there is an importance in symbolism and, when Holt undertook a major tour of the region after he became prime minister, it was very important.

I guess it’s fair to say that of all the former ministers in Menzies governments that I interviewed for the book – Jim Forbes, Doug Anthony, Peter Nixon, Malcolm Fraser and Tom Hughes (a minister in John Gorton’s government) – it was fair to say that they were all of the view that the Coalition had no hope of winning the 1972 election.

The one exception to that was Doug Anthony who told me, and it was reported in the press at the time, that after the budget of August 1972 was brought down, he urged McMahon and Snedden, who was then the deputy leader and treasurer, to go to the polls immediately because he thought he could fight the election on the strength of the budget which was quite well received. If they waited the election would be seen as a contest between Whitlam and McMahon and he did not believe McMahon could win that contest. In the final analysis, the election was not held until December and, as everybody knows, lost.

In summary, what were Menzies great skills as a political leader? As a public figure? He had presence, he had style, he was in my view the best political orator – he’s certainly the best political orator I’ve ever heard. He had a remarkable capacity to orate, to effortlessly say what many other people thought. He understood that politics was a battle of ideas. He used the modern jargon. He was a conviction politician. He understood that unless you got into power you couldn’t do anything but once you had power you had to do something otherwise you might lose that power. He was an aggressive political campaigner. If he spotted a weakness in a political opponent, he was ruthless and relentless in exploiting that weakness. But he was also somebody who understood that every so often the public would like to see nothing of you, as prime minister. Every so often it’s a good idea for a prime minister to completely disappear.

It’s much harder now with social media. You’ve got to remember there was no television until 1956 in Australia – seven years after Menzies had become Prime Minister. There was no talkback radio until well into the 1960s in my understanding. You only had the odd opinionated radio commentator. Today, such things have an enormous impact.

Menzies had that remarkable capacity to sense that the public occasionally wanted a rest from both politics and also their prime minister, however much they may have respected him. Did he make mistakes? Plenty. All prime ministers do. The important trick, or skill, in public office is to get the big things right. And Menzies was very successful in getting the big things right. He retired at his own time, on his own terms. And that itself was a significant compliment to him.

Menzies understood the extraordinary value of the Coalition. He said, when he retired, that the Coalition was fundamental to his success. It was something that was also the very strong view of Malcolm Fraser who ran a very effective Coalition. And it was also my view and my experience. I’ve often said that I owe a great deal to Tim Fisher, John Anderson and Mark Vaile who were the three successive National Party leaders in my time as Prime Minister.

Above all else, Menzies understood the national security dimension of Australian politics. National Security, or Defence and Foreign Affairs as it was then called, has always been a very important thing in Australian politics. Menzies understood the nature of the communist issue in the early 1950s far better than did his Labor opponents and he used it very effectively. It was during Menzies’ time as Prime Minsiter that the ANZUS treaty was signed between Australia, New Zealand and the United States.

As I said at the beginning, this is neither a biography – in a personal sense – nor a hagiography of Robert Menzies. It’s a book written with significant respect and admiration for what he achieved. It’s designed to put a case for a greater recognition of the contribution that his leadership and those around him during those years made to the building of modern Australia. And if it does that I will be well pleased.