1933
The Heidelberg dress
Australia in the Depression
At the height of the Depression a function was held in Heidelberg, Victoria, that offered a cash prize for the best costume. Eight-year-old Patricia Chalcraft wore this dress, made from curtains with designs painted on the fabric in household paints. The Chalcrafts were involved in the Heidelberg Unemployment Bureau, and the dress had the dual aim of publicising the life of the unemployed and hopefully winning the price of a pair of shoes for Patricia. ‘The dress was my father’s hope not only for himself but for all his friends and people that were needing work,’ Chalcraft told the National Museum of Australia in 1999. ‘If he could in some way help others, as well as himself, it was all he wanted. I think by painting this dress he was more or less putting himself in the place of all of these jobs, thinking that he could do it or someone close by could do them, and hopefully that somebody might see it as an advertisement to work if they needed it.’
There impact of the Depression was profound politically, and it was the catalyst for great turmoil. But it also solidified the theme of mateship that was a large part of Australia’s self-image. The average Australian was stoic, resourceful and good-humoured in bleak times. The Heidelberg Unemployment Bureau held meetings, dances and social engagements to keep community spirits up.
‘People were forced into all sorts of tricks and expediencies to survive, all sorts of shabby and humiliating compromises. In thousands and thousands of homes fathers deserted the family and went on the track (became itinerant workers), or perhaps took to drink,’ wrote Wendy Lowenstein in her oral history Weevils in the Flour. ‘Grown sons sat in the kitchen day after day, playing cards, studying the horses [betting on horseracing] and trying to scrounge enough for a threepenny bet, or engaged in petty crime, mothers cohabited with male boarders who were in work and who might support the family, daughters attempted some amateur prostitution and children were in trouble with the police.’
According to one worker: ‘Depression! I was walking the country looking for work from the end of the World War I until the start of the Second, till 1939!’ The lack of social security payments meant that men were required to go on the track looking for work; many of them relied on the kindness of strangers when jobs were not forthcoming.
Curiously, even though unemployment reached 32 per cent in some towns, there was not a huge surge in support for the Communist Party and no widespread social unrest. Political extremism happened on the right, with a middle-class swing to the ultra-right and organisations such as the New Guard.
The world had not seen a great depression before, and there were two schools of thought as to how to deal with it. The classical-economics approach was to withdraw, live within one’s means and wait until it passed. The other approach, which came to be associated with the economist John Maynard Keynes, was to say that when demand from the commercial sector dried up, governments should create demand through public spending.
The debate was personalised in the shape of the Bank of England’s Sir Otto Niemeyer, who visited Australia in 1930 and insisted that the nation not default on its loans – especially those from the Bank of England and other British corporations. He advised that the way out was slashing government spending, cancelling public works, cutting public-service salaries and decreasing welfare benefits. This was known as the ‘Melbourne Agreement’. The other case was put by the blustering, corpulent Jack Lang, premier of New South Wales. A follower of Keynes, Lang advocated public works such as continuing the construction of the Sydney Harbour Bridge – and if that meant a moratorium on foreign bank repayments, then so be it. Federal treasurer Ted Theodore also supported an inflationary, expansionist policy, but he was defeated in the party room.
The Premiers’ Plan required federal and state governments to cut spending by 20 per cent, including cuts to wages and pensions, plus tax increases, reductions in interest on bank deposits and a 22.5 per cent reduction in the interest the government paid on internal loans. These were contractionary policies.
The Labor government of James Scullin and most of the state Labor Party leaders fell in behind Niemeyer, but Lang would not be shifted, and while he signed on to the Premiers’ Plan he refused to pay interest on his loans. The Sydney Harbour Bridge opened on 19 March 1932. The standoff between Lang and the banks and the Federal government continued until 13 May 1932 when the governor of New South Wales, Sir Philip Game, used his reserve powers and sacked Lang.
The Depression threw the federal Labor Party into disarray. Joe Lyons quit the party, brought down the government and became prime minister himself. History has shown that the conservative approach of Niemeyer and the Scullin and Lyons governments actually exacerbated the Depression in Australia and that the stimulus package devised by Lang, which was adopted as the New Deal in the USA, was the correct response to a depression.
The Chalcrafts’ dress inexplicably won only second prize (the winner has not survived). Patricia won a book voucher but no shoes.