Bob Katter (Kennedy, Independent) Share this | Hansard source

There has been a lot of noise made about inflation and interest rates. For those who like reading economics books written by Nobel prize winners, you can read Samuelson or Milton Friedman, and they will tell you that if you increase money supply but you do not increase goods and services then you will have inflation. That is what you want to concentrate on, instead of listening to silly Treasury advice about how interest rates are going to save us all from inflation. Our inflationary rates are not much different from those of the United States, and yet their interest rates have been less than half Australia’s interest rates. The people I represent have very high debt, so they have to pay very high interest. It is a huge burden upon them. They ask themselves: ‘Why am I charged twice as much in interest rates as the people in the United States? Don’t they have any threat from inflation in the United States?’

Then, of course, there is the matter of the Australian dollar, which has risen from around 60c to around 90c, which has taken some 30 or 40 per cent off the value of our cattle producers, our sugar producers, our mine workers and everybody else who exports. Those are the people I represent. Australia has the worst current account, probably, of any country on earth but there is no mention of it by any speakers on the budget; we could just keep going on each year rolling up a massive amount of debt and not having to worry about it!

If you think that Treasury are clever people, you do not know much about Australian history. Treasury are the people who brought us the recession that we had to have. They brought us the credit squeeze which almost destroyed the Menzies government in the sixties. They brought us Sir Otto Niemeyer from the Bank of England who created the Great Depression. Treasury brought him out here to advise us on how to run our economy. So Treasury have a very lamentable history in Australia and I see absolutely no reason to believe that they are any wiser today than they have been throughout our past history.

An interest rate double that of the United States and 20 times higher than that of Japan—our two major trading partners over the years—is disgraceful. It is an absolutely disgraceful performance. The previous government must take the criticism for that—they were there for 11½ years. The governments before that—effectively the Keating government; he claimed he was running the country through the Hawke years and I think he probably was—must take the blame for destroying the manufacturing base in Australia.

Let me be very specific. I do not like making assertions without backing them up. In 1985, the year before Mr Keating introduced his enlightened free market policies, 79 per cent of Australian motor vehicles were Australian made. Last year, only 19 per cent of our motor vehicles were Australian made. We do not thank the penguins in Antarctica for that; we thank the successive governments that have ruled Australia for the last 20 years. They have completely destroyed the manufacturing base of this country. Very few people are aware that they have all but destroyed the agricultural base in this country. Their work will finally be completed when they take away half of the irrigation rights from the people on the Murray Darling, reducing Australia’s agricultural production to about 30 per cent—depending on what data you want to look at. In any event, our cattle numbers are down 17 per cent and our sheep numbers are down 50 per cent. I will not comment on wheat. Our milk production is down 17 per cent. The final one of the big four is sugar and we are closing three mills every four years. We only have 24 mills left.

What a sorry tale we have to tell. But Treasury tells us that all the indicators are wonderful. The American treasury, in September 1929, told the American government that everything was rosy in the garden. Our Treasury told us that before the infamous credit squeeze, they told us that before the recession we had to have and they are telling us that again now. For those of us who take a keen interest in these things, we place no credibility in what Treasury tell us. We do know what we are paying in interest rates. Any fool can find out that it is twice what the Americans are paying and has been for the last seven or eight years. We can answer that question all right. We can answer the question about balance of payments. This is rather intriguing. Everyone is aware that we are a big mineral-producing nation. I am probably the only person in parliament who has ever been involved in mining in a real sense both as a labourer at Mount Isa Mines and as a producer and mine owner in my own right. I know a little bit about the mining industry. The average price of our coal, base metals, iron ore and gas has gone up 300 per cent how come our balance of payments has not? I will tell you why it has not. It is because the government sat on its hands and allowed our seven major mining companies to be purchased by overseas corporations. So the 300 per cent increase in value, whilst it makes a big difference to our trade deficit, which is now a trade surplus, makes no difference to our current account because when it comes in it has to be sent overseas to our owners, the seven mining companies that are now all foreign owned. Who do we blame for that—the penguins in Antarctica? No, it is the free trade policies of successive governments over the last 20 years.

I heard myself on the national news commenting about Senator John Button and thought: someone out there loves Senator John, arguably one of the two or three finest ministers since the Second World War. People claimed he was a free marketeer. If you take $400,000 million of public money and invest it in an industry to render that industry competitive, I would not call you a free marketeer. In fact, I would think that is the absolute height of interventionism. He introduced the round robin arrangements for the car industry, which again is the complete opposite of the successive government policies of non-intervention. Bumping into Senator Button in Melbourne, I said to him, ‘You rendered the steel industry internationally competitive, taking us from 80 tonnes per man per year to 720 tonnes per man per year and you rescued the car industry and got sacked for your achievements.’ To prove, as Button did by actually doing it, that Mr Keating’s policies were deadly wrong was actually a sackable offence, and for doing that he got sacked. He did not say that to me but he roared laughing when I said it to him.

If we continue to apply these policies, the future for our nation is a very sorrowful one indeed. If you are elected by the will of the people to be leaders of your country and you have not got enough gumption to read a couple of books, check up on a few figures and realise the extent of the lies you are being told, you have sorely let down your country, and history will pass enormously harsh judgement on you. It is amazing how history works in the long run. Mr Kerin, whom many of my friends had a very low opinion of, secured a subsidy scheme as an exit package for the milk industry. Again, it was really a cross-subsidy arrangement. I will not go into the details of how or why it emanated. Suffice to say that he got a small subsidy from the consumers of Australia to help the manufacturing sector, which effectively is the export sector. We went from around $600 million a year in exports—do not quote me on the figures, but you will find they are roughly correct—to about $2,500 million a year under the Kerin Plan. When the Kerin Plan was abolished and the government deregulated the dairy industry, the Labor state governments participating up to their eyeballs, the export industry collapsed almost completely.

I do not know if people in this place are interested in history, but when former Minister Anthony introduced the wool industry scheme, the price of wool doubled over the next three years. When Mr Keating abolished it, the price halved over the next three years. When Mr Kerin introduced the subsidy arrangement, we put an extra $2,000 million in export earnings, a 300 per cent to 400 per cent increase for that industry. When it was abolished, the export part of the industry collapsed almost completely.

Changing pace completely, at the summit I drew a map of Australia on the board and I drew a line from Port Hedland across to Gladstone. Some of the great mining magnates of Australia were in that room of 20 people, as also was Minister Albanese and Treasurer Swan. I said, ‘Everyone in this room is aware that all of our base metals are above that line, in the top third of Australia.’ The honourable member representing the Northern Territory is nodding in agreement. We know the Olympic Dam and Coolgardie are not—there are some exceptions—but it is a fair call to say that all of Australia’s base metal income, which is maybe about a third of our export earnings, is above that line.

To process metals you have to have cheap electricity. There is not one single baseload power station north of that line. In Queensland our base metals are not processed at all from any baseload power. They have to generate their own power by diesel, the most inefficient method known to man, and by very expensive gas. To put a figure on that, the price of gas is about $10 a gigajoule and the price of baseload coal-fired power is about a dollar a gigajoule. So it is about 1,000 per cent higher. Needless to say we are not processing a lot of our metals; they are going out of Australia unprocessed.

During Cyclone Larry, a big ship going out of Karumba nearly tipped over. It was carrying zinc concentrates; it was not carrying zinc—and it cannot until some baseload power stations are built. My colleague from the Northern Territory will be well aware that north of that line lies over 300 million megalitres of water. South of that line there is hardly any water at all; there is only around 80 million megalitres. Madam Deputy Speaker, do I have to tell you where 95 per cent of Australia’s agricultural production is? Yes, you are right: it is south of the line.

We can say a lot of things about ourselves, but if you were an objective observer you could not say that we are a particularly clever country when we are trying to do all of our agriculture where there is no water and doing none of our agriculture where all the water is. The honourable member from the Northern Territory will tell you about the vast open spaces and beautiful soils of the Barkly Tablelands, the Daly River basin, the Fitzroy and Ord rivers and the mighty Gulf Country, where seven million hectares of land, an area of the size of Tasmania, is taken over by dirty, filthy weed.

Finally, we would all be disappointed if I did not mention the word ethanol. Future generations of Australians will be quite fascinated. Here is something that cuts the price of petrol to 75c to 80c a litre. When I go home I tell people: ‘We spent the whole of the last two days arguing about whether we should watch petrol prices.’ Who the hell is interested in watching? Really, you might get it 2c cheaper here or 2c cheaper there. What in heavens name does that do about the petrol prices in Australia? In the meantime, the Americans and the Brazilians—and the Chinese and Indians, because they are now both producing ethanol, as the Russians soon will be; the European Union has already recommended it—must think we are the most stupid country on earth. But we are not. Our leaders are, but we are not. We Australians are not, but the people we constantly elect into government are.

When I became an Independent I had a close look at what happens to you as an Independent. I found out that, until Ted Mack came along, not one single Independent ever got re-elected to this place. Now we are getting re-elected continuously. That must tell you something. We had Pauline Hanson, whatever you might have thought about her. I would have doubted that she was the sort of person who could take 15 or 20 per cent of the vote in Australia, but it has to tell you that many people are pretty unhappy with the political parties in this country that have delivered to us the complete destruction of the manufacturing sector, the imminent collapse of the agricultural sector and, of course, the blood sucking off a mining industry that is finding it enormously difficult to survive when it cannot get any power to process its metals. And with the huge cost of transportation now, and with diesel and petrol prices going through the roof, how the hell can we get our metals out? If we process them, we will only carry away maybe one-tenth of the weight that we are carrying away now.

But we cannot do it without baseload power stations. Under free-market policies you have to be able to sell the entire capacity of that petrol station. I have been trying to do it for the last four years at Pentland, which is the nearest coal seam to north-west Queensland, this giant mineral province, and I have to tell you it is pretty difficult because, when that power station comes online, there will have to be 1,000 megawatts worth of customers to buy every single megawatt.

I will conclude on what good government does. I have mentioned Senator Button and John Kerin before. I have also mentioned Doug Anthony’s wool scheme before. The nation’s biggest export item is, of course, coal. Very few people in Australia are aware that, in the 1950s, Australia was a coal importing country. We imported coal! By 1966 Queensland was the biggest coal exporting state on earth. I will tell you how it was done, because I happened to be there. I was a very young person at the time, a protege of the great Ron Camm and Bjelke-Petersen. We knew that we had the reserves. We drilled for them. We knew Japan wanted to buy them. Mr Theiss—God bless that very great Australian; a man who finished school at sixth or seventh grade and who was one of the giants of Australia—spent about $100 million drilling for coal. He did not know whether he would be able to sell it. He did not know whether he would be able to find a market. He did not know whether he could get a government to help him transport the coal to a port to get it out of the country. But he spent that money anyway.

The Utah Development Company realised that Japan was never going to be able to buy its coal entirely from America, so they had to find another source to supply Japan. They came to Australia and drilled beside Mr Theiss. He had already found coal, and Utah reckoned that the easiest way to find coal as well was to drill beside him. As luck would have it, they did find coal. Theiss and Utah said to the government, ‘We can’t get it out unless you build a railway line.’ The government said, ‘We’re not going to build a railway line unless you have coal mines working’. Theiss and Utah said, ‘We can’t build a coalmine until you build the railway line.’ It was a classic chicken and egg situation. This went on for about seven or eight years. Then Bjelke-Petersen was elected and the railway line was built by government.

But there was no way in the world that two small mines could service a huge government expenditure of $1,000 million. With our free market policies today, it would be utterly impossible. Not only did the Queensland government make that investment but it built the port in Gladstone—one of the sixth biggest ports in the world. That was another $600 million or $700 million. The government then built the biggest power station on earth. Unlike today, where we have to sell every single megawatt out of Pentland before we can pour any concrete, not one single megawatt of electricity was sold then. The government built this huge, giant power station with not a single customer for it. We have a free market policy today that says, ‘You can’t do that.’ But in those days it was different, which is why aluminium and coal are the two biggest export earners for Australia today. (Time expired)

See this speech in context