Tiberius with a Telephone

by Patrick Mullins

  For those in cabinet and the ministry, there was little liking for McMahon. Senator Shane Paltridge, the minister for civil aviation, disliked McMahon intensely. Paul Hasluck, who had initially thought of McMahon as a ‘rather funny little man’, regarded him with a contempt that only ever grew.16 McEwen would frequently clash with McMahon, and he detested his inability to keep secrets.17 ‘Oh, Jack was in a foul mood in Cabinet tonight,’ McMahon would say.18 Country Party MP Doug Anthony, elected in 1957, initially respected McMahon for his position and seniority, but soon saw that McEwen ‘had complete disregard and distrust of McMahon’.19 Alexander Downer, who entered cabinet in 1958 and sat next to McMahon, admired his work ethic, but thought he lacked Holt’s ‘humanity’ and could be irritating. McMahon spoke too much, on too many subjects, pontificating when he should have been quiet. ‘Occasionally,’ Downer wrote, ‘he erupted into fits of temperament, gathering up his papers and leaving the room with merely a nod to the Prime Minister.’20

  Garfield Barwick’s dislike was sharp. He believed that McMahon had undermined him, had bet on him to lose his seat, and was a compulsive leaker of information. ‘He couldn’t keep a secret,’ Barwick said. All sorts of measures had to be taken to counteract this, Barwick recalled. A cabinet discussion on commuting a death sentence had to be conducted late at night, without an advance submission, in order to prevent McMahon leaking it beforehand. ‘So I brought the paper in,’ Barwick said. ‘The item came on somewhere about quarter to nine … And we finished somewhere about 11.00pm. The Sydney Morning Herald had it before midnight.’21 Also of annoyance was McMahon’s propensity to re-explain matters and his attempts to be friendly. When McMahon told Barwick not to be annoyed, that he was only trying ‘as a brother lawyer’ to be helpful by re-explaining something, Barwick was acerbic: ‘Not so much of this “brother lawyer” please. There is a hierarchy in the law, you know.’22

  Others, from further away, had a slightly different view. His ‘party days’ friend, Richard Kirby, now knighted and president of the Conciliation and Arbitration Commission, had watched McMahon’s advancement with a recognition that there were qualities in the man — persistence, a readiness to fight, discipline, and a capacity for hard work — that others might not see:

  People used to say ‘Billy’s far too well-dressed to be able to pass his exams’. When he did, they said, ‘Billy will never get into politics — his manners are too good’; and later, they said, ‘Billy will stay on the backbench. He’s too much a dilettante ever to make the ministry.’ Billy was a magnificent fighter — literally. He could box like a thrashing machine and he was game as hell. But people seemed to overlook that.23

  McMahon was not unaware of the dislike that he attracted. ‘In the early years, for nearly ten years, I think I felt a fair degree of antipathy or hostility,’ he said later. But he attributed it to his propensity for work and preparation: ‘I was a hard worker and I usually went into cabinet fully briefed about whatever paper was to be discussed and a lot of people didn’t like it.’24 The inability to recognise how and why people disliked him was a conspicuous failing, one that would become as pronounced as his need to secure acknowledgement of his merits and talents.

  McMahon’s new job required him to be game. It was important politically and economically. Industrial relations had been prominent in the government’s agenda in the past decade. Its efforts to contain inflation and combat communism had been frequently directed towards the trade union movement, which the government believed had been infiltrated by communists intent on disrupting productivity and industrial peace by inciting strikes and unrest. Tension was particularly evident in the stevedoring industry, which had replaced coalmining as a hotbed of industrial disputes. Clashes with the Waterside Workers’ Federation of Australia (WWF) had been perennial for Harold Holt and would be also for McMahon. The union was militant. Its general secretary, Jim Healy, was a communist. Combined with the ineptitude of some employers, the union’s intransigence had helped to make Australia’s shipping industry one of the most inefficient in the world.

  Yet in the first decade of the Menzies government, Holt and Bland established a way of handling disputes. They had built up the Australian Council of Trade Unions (ACTU) as a key point of contact with the union movement, regularly consulting and pampering its president, Albert Monk, in a deliberate ploy to moderate union demands. They had worked in concert with the Conciliation and Arbitration Commission, which mediated negotiations or sat in judgement as an independent third party with powers to set awards, working conditions, and man-hours. They had used the pulpit afforded by Parliament and the information provided by the department and ASIO to pressure, influence, and intervene in the labour market. Importantly, Bland and Holt tried to be fair: they were as willing to ‘clout’ employers as they were to go after the unions in pursuit of what Bland defined as a ‘test of public interest’.25 They were an effective team, and their example showed that flexibility, toughness, and a capacity for negotiation were prerequisites for success in the labour field.

  Ostensibly, McMahon was no different. His overriding concern was ensuring that industrial unrest was kept to a minimum. Holt had managed to keep the days lost to disputes low, so McMahon needed to maintain those low levels, if not do better, to be successful. Yet his willingness to trust his relationships with shipping representatives left him largely unsympathetic to the concerns and demands of unions, most of which he believed were controlled or influenced by communists. He often attacked any unrest as the work of communists.26 Combined with his propensity to leak, this black-and-white view of the world caused Bland to keep McMahon in the dark about the relationship with Monk and, indeed, some of the policy aims that Bland was working toward. But the hurdles and difficulties would come thick and fast.

  Amid a surplus of labour and the growing mechanisation of waterfront work in the late 1950s, the WWF began lobbying for the introduction of pensions and long-service leave for its members. After the Tasmanian state government decided to offer the latter in 1960, Bland saw an opportunity to deal with unpalatable problems.27 He pressed for the Commonwealth to introduce its own less-generous scheme and, simultaneously, to extract a ‘disciplinary quid pro quo’ from the wharfies, as one historian later put it.28 The stick to Bland’s carrot of long-service leave was three-branched: first, the accrual of long-service leave would be suspended for up to a month for each day lost to port stoppages. Second, attendance payments — money paid to wharf workers for coming to work — could be automatically suspended for four days by the Australian Stevedoring Industry Authority (ASIA) should a sizeable stoppage occur in a port. Third, workers aged seventy and over would be automatically transferred to an ‘irregulars’ register, and workers over sixty-five would be offered the same opportunity, with the inducement that those workers could immediately access that accrued long-service leave.

  McMahon received this proposal early in 1961. His response was guarded, cautious. He was unsure that public opinion would swing in behind the government, and he worried about the political implications of such a move when another election was imminent. Bland had to persuade McMahon and then assuage him again, buck him up and assure him of the pervasive problems and the ways that the new measures would address them. ‘By legislating for long service leave you are in effect coating the real pill which is provisions to secure improved performance and better discipline,’ Bland wrote to McMahon, early in March.29 A fortnight later, he was writing again, this time rather tiredly, to outline his measures once more: ‘The issues are very simple.’ Increased indiscipline could not be addressed with the available remedies, he wrote. The ageing workforce was inefficient and could not be gotten rid of without inducements of the kind that the measures would provide. In the absence of action, long-service leave was inevitable — but inaction would ensure it came without any benefit to the government.30 The argument eventually convinced McMahon. He came on board.

  Other ministers also responded
cautiously when the proposals were circulated before their submission to cabinet. The timing was bad and the measures seemed provocative. Holt disapproved; McEwen had reservations. But Bland pushed McMahon to override them. He pointed out the political benefits that the measures could bring: a chance to campaign on communism would be lost if the government delayed. McMahon vacillated, hesitated, and then managed to bring Holt and McEwen around. The submission was placed on the cabinet agenda, and was accepted on 19 April 1961, with a remit to get the measures on the statute book quickly.31

  The WWF was stunned. It received news of the measures on the same day that it met employers to discuss the prospect of pensions. It quickly realised the outrageous hand it had been dealt. Its workforce would be winnowed; access to more generous, state-based long-service schemes would be blocked; the sanctions and penalties would dissuade protest actions. There were no bright spots.

  McMahon introduced the legislation in the House on 10 May. He noted that in the time since he had taken on Labour and National Service the man-hours lost to strikes and stoppages had risen, from 345,000 in 1958–59 to 806,000 in 1959–60. His cause established, he blamed the most draconian measures on the WWF: ‘It is they who must carry the responsibility for what is proposed.’ Everything that was happening on the waterfront was the responsibility of its leaders: ‘In truth, the leaders of the Waterside Workers Federation have been engaged in a prostitution of the very purposes of trade unionism.’32

  Labor was outraged by the measures as much as it was by McMahon’s handling of the Bill. The lack of warning, the failure to provide timely copies, and the abbreviated debate that McMahon enforced by use of the guillotine angered them greatly. Arthur Calwell — now leader of the opposition, after Evatt’s ignominious appointment as chief justice of the Supreme Court of New South Wales — registered strong protests, but found it hard to avoid the decided notes of chaos.33 He was wedged: unwilling to embrace the communist-tainted WWF, as some members of his own side wished, yet clearly wishing to protest the drastic action. He was not helped by a WWF strike, held in defiance of the ACTU. Between the unrest on the waterfront and the Coalition’s freewheeling use of the communist brush, typified by Liberal MP Jim Killen’s declaration that Jim Healy had ‘the interests of Moscow at heart’, the Bill seemed to work out entirely in the government’s favour.34 The only salve for the ALP was that it could needle McMahon for his reliance on Bland for information about the measures.

  Nonetheless, McMahon won plaudits for the action, and the political dividends flowed throughout the year. A three-part series on thuggery and violence on the waterfront, written by Alan Reid for The Bulletin, reinforced the perception that Bland, McMahon, and the government had done so much to create.35 Jim Healy’s unexpected death in July and the subsequent election of an ALP-aligned successor, in Charlie Fitzgibbon, ensured that the WWF’s ability to campaign against the new Stevedoring Act was limited. By August, almost half of the 1,844-strong workforce had taken the long-service leave benefits and transferred to the ‘irregulars’ register, improving efficiency. McMahon was triumphant.36

  The efforts needed to convince McMahon to take on the WWF were dwarfed by those required to convince him to support the removal of the ‘marriage bar’, which forced women who married to resign as permanent officers of government workforces. In November 1959, a Menzies-appointed committee studying public service recruitment formally recommended that the bar be removed. In its reasoning, the committee cited international disapproval, the outdated nature of the bar — the UK, from whom Australia had inherited the bar, had removed it in 1946 — and the discrimination against women.37 But action was deferred until an inter-departmental committee could report on the consequences of the removal of the bar. It took until August 1961 for that committee to report back. When it did, Bland pressed McMahon to support its recommendation that the bar be consigned to the past. ‘I hope … you will support this. It is entirely right in principle,’ he wrote. Removal of the bar, he went on, conceivably had a ‘political value’ that could be used as a trade-off for equal pay.38 This was not enough for McMahon, and when the submission went to cabinet on 24 October he voiced no support. As the resulting cabinet decision noted, the recommendation was considered ‘as a social question’ only. According to the secretary of the prime minister’s department, John Bunting, cabinet took the view that:

  [I]t was against public policy to facilitate the employment of married women, and thus perhaps worsening a situation in which already there was too [much] neglect of children in favour of paid employment.39

  The result, as well as McMahon’s refusal to offer support, frustrated Bland immensely — but did not cause the permament head to abandon his own views.

  Throughout the year, McMahon wrote to Menzies — supposedly on the prime minister’s invitation — with thoughts on the economy and the political landscape. He drew on departmental figures on employment and industry to fortify his analyses, and by mid-1961 they were leaving him equivocal. The government was short odds to win the election, yes, McMahon wrote, but there were problems. In its attempts to discipline the overly buoyant economy the year before, in 1960, the government had been forced to offer strong medicine, in three doses. The third had been conspicuous and severe: in order to mop up excess demand, reduce monetary liquidity, and reduce the high rate of imports, Harold Holt had introduced in November 1960 a package of measures collectively referred to as the ‘credit squeeze’.

  Earlier in 1961, as those measures bit, there had been murmurs of discontent. By June, McMahon was writing that criticism of the government was rife within the circles he moved, and spreading. He suggested that Menzies make a statement to restore confidence. A month later, he wrote to say that unemployment was growing and that school leavers would soon be entering the work force, affecting unemployment again. Industry was suffering, and business was growing ever more critical. ‘What should we do?’ McMahon asked. His answer, though, was not much. ‘It is worrying, but not a cause for alarm. The theme [for the election] should be a sound and developing economy and we should certainly give up explaining away the past and rationalising about unemployment.’40

  But it was unemployment, and the government’s management of the economy, that turned out to be the biggest issue of the otherwise unremarkable election campaign. Replying to what he termed the government’s ‘stay put’ budget in August, Labor leader Arthur Calwell outlined his own plans should Labor be elected: he promised to restore full employment within twelve months, and undertook to expand social services without increasing taxation. By November, he was making the government’s economic performance the emblem of everything that was wrong with it:

  There was no valid reason for the credit squeeze which sent prosperous industries sliding down hill, and men and women cascading into the unemployment pool. That was a piece of high-handed economic bungling which only a reckless, power-hungry Government could conceive and carry out; and carry out against the warnings of the people, industry and the press.41

  Calwell’s mention of the press was hardly idle. At the behest of Warwick Fairfax, the soft-spoken chairman of John Fairfax & Sons, The Sydney Morning Herald was supporting the ALP’s campaign with advice on economic policy and advertising, and by lending employees, including one Maxwell Newton,42 as speechwriters. The munificence prompted Calwell to request an explanation as he was leaving the paper’s Broadway offices. ‘Well, it’s a simple proposition,’ Fairfax replied. ‘If you were running a newspaper and you found that your classified advertisements had fallen drastically … you would want a change of government, wouldn’t you?’43

  Not the only explanation, it nonetheless had some force given the string of redundancies the paper had been forced to make earlier in the year. Fairfax and Menzies had long regarded each other with ambivalence if not outright hostility, with Menzies blaming the paper for his resignation in 1941. On the surface, the Herald’s drift towards the ALP was circumspect and slow;
realistically, given its material support, the paper’s eventual advocacy for a Labor vote at the 1961 election was unsurprising.

  Criticism from the Herald was countered by the support the government received from the Packer-owned Daily Telegraph. Sir Frank, as he had become known in the two years since his knighthood was awarded for his ‘services to journalism’, was an unabashed admirer of Menzies and profoundly disliked Calwell, who, as minister for information during World War II, had enforced censorship restrictions to the point of ordering seizure of newspapers. Importantly, Packer and McMahon were friends. They had become closely acquainted, thanks to the efforts of George Halliday, a surgeon with expertise in ears, noses, and throats who treated both for their various ailments. ‘He succeeded in bringing his two patients together,’ David McNicoll, one of Packer’s favoured journalists, wrote later, ‘and, in doing so, steered Packer to a political fixation about McMahon.’44 The relationship was strengthened by their shared experiences at Abbotsholme, the connection of Allen Allen & Hemsley (which Packer kept on retainer), McMahon’s investment in Sydney Newspapers Ltd, mutual acquaintances (notably, Jack Cassidy), and McMahon’s defence, in October the previous year, of Packer’s controversial attempt to buy publishing company Angus and Robertson, then chaired by McMahon’s mentor and colleague, Sir Norman Cowper.45

  Thus, in November, when Alan Reid bluntly informed Packer that he thought the government was going to lose, the press proprietor dispatched him immediately to Menzies with an order to repeat the warning and what Reid believed was the solution: a promise to restore full employment within six months.46

  Menzies’ subsequent promise that he ‘would never rest content’ until unemployment was eradicated was given splashy, prominent coverage in the Telegraph. Despite the absence of any kind of method or timetable, the words were enough for the front page and a subsequent editorial that Menzies had talked ‘sense’ on jobs while Labor played politics.47