© Warren Fahey
Like it or lump it: bust inevitably follows boom.. It’s difficult not to imagine spinning on a merry-go-round when trying to work out whether our economy is still riding the boom wave or headed for the dumps. Those two little words, ‘boom’ and bust’, appear in headlines almost daily, as if the pundits are betting on a two-horse race on a very slippery track. Of course the big question is how far, and where does the bust dump us, especially us little chickens?
I’m no financial whiz kid, but as a folklorist and social historian I know a few things about our shaky economic past. Not that we seem to learn much from history, be it one hundred years or one week. A little spin through the years on the money-go-round is a rocky one.
The nineteenth century saw Australia riding the boom wave for over fifty years. We were lucky in that the convict experiment had such a fortuitous outcome and, by the 1840s, commerce and agriculture were already reaping results. Lachlan Macquarie can take a great bow in this respect: his far-sighted governorship set the boom wheels in motion. We then struck it rich in 1851 with the announcement: “there wuz gold in them thar hills”. It was there alright, and as one old prospector, Rad Dawson, told me, “there was a hell of a lot of earth mixed in with it”. The real gold, of course, was the massive increase in population lured by the gold rush hysteria. The colony’s population jumped from around 400,000 in 1851 to around 1,250,000 a decade later. Many colonials made their fortune in these years. Some were lucky enough to unearth sizeable nuggets while others made their fortune in supplying the hopeful diggers with everything from newspapers to grog. These were heydays, where fortunes made were often quickly lost to foolishness and misfortune. The one thing we tend to overlook at this time was the importance of the workingman’s independence. On the diggings a man could be self-employed rather than a decade before when the average man worked as a shepherd or farm labourer. With independence came a questioning spirit debating the rights and the continuing relationship of owner and worker.
Gold eventually petered out or became the domain of large mining companies but the sailing clippers and steam ships did not diminish. Our ports were buzzing with new arrivals: new chums headed for the bush to work on the ever-expanding cattle, sheep and wheat stations. Australia was firmly on a boom riding on the sheep’s back, herding massive cattle teams and waving golden wheat. Export figures astounded everyone and our produce chalked up record prices and quality accolades as ‘world’s best’. Refrigeration and early canning sent sales soaring further as the English declared our beef “better than the roast beef of old England”, and our butter as “wondrously golden”.
But there were troubles brewing, especially in the shearing sheds where the majority of workers were itinerants. There were lots of reasons to grumble and fight: many of the squatters were bastards, wages were low, living conditions poor and, if you believe the old songs and stories, the tucker was lousy too. There was also the old annoyance of the squatter being able to ‘raddle’ the sheep’s back with a blue paint (they referred to the paint stick as ‘Toby’) deeming the sheep badly shorn and the shearer not to be paid.
The sheds also attracted militant unionists who were keen to try their newly found muscle. Being a male-dominated society living in very close quarters, and with no grog and very little distraction, heated conversation was high on the agenda. Despite the rumbles, the squatter remained boss of the board for a long time as if to test the very mettle of the working class. The newspapers and magazines also fuelled the fight although many, like The Bulletin, trod a wary path continuing to glorify both the shearers and the squatters. The cattle industry saw some discontent but it had far fewer workers and, besides, the drovers and station-hands worked in very isolated conditions.
The nineteenth century boom that started rolling in the 1840s hit a massive bust in the early 1890s. Strikes erupted across the shearing industry and the ‘Who’s Master, Who’s Man’ debate heated up to the temperature of Hades. The bust was devastating for the economy, the banks, the landowners and the workingman. Farmers walked off their holdings leaving their properties to the crows; workers walked and talked and walked, from town to town, in search of work or to meet the sustenance scheme demands. The shipping lines and agents, freighting companies, holding warehouses, auction centres and the like, either closed up shop or looked elsewhere for business. A devastating drought in 1902 further bashed the rural sector. In the cities trouble continued to brew and in that same year a mass meeting of Sydney boot makers had the temerity, or so it seemed, to recommend a national union of all trades.
The most obvious new business was coal. As the rural agricultural industries declined the factory chimneys went smoking hot. New South Wales had rich deep coal veins, particularly in the Hunter Valley and inner western plain regions. By the 1890s coal mining had accelerated to match the demand of that turn of the century, and the growth of manufacturing, firmly placed coal on the front line.
Over a period of ten years Australia experienced a dramatic population shift whereby, for the first time, the majority of the people lived in the coastal cities, rather than the bush. Work was to be found in the factories and the factories were in the cities, near rail and sea transportation. Government had also seen the need to intervene in the seemingly never-ending struggle between labour and capitalism, and in 1907, after much heated debate, basic wage was introduced at two pounds two shillings.
Slowly the economy started to feel strong again and city factory and commercial life appeared optimistic. We had a newly federated government, new jobs, new inventions, better transport systems, reliable pay packets, and the joys of city life. The balance of the sexes had changed too. Women lived in cities and, doing what comes naturally, our population increased too.
In 1906 a boom erupted around the discovery of gold near Melbourne. The ‘Poseidon’ rush, at Tarnagulla near Bendigo, promised to prove the richest gold field strike for many years. Two exceptionally large nuggets had been found to reignite the old cry of ‘Rush Away!’. Like mineral booms to come it died down with a wimp.
WW1 knocked us about more than a little but post war the economy shook itself and revved up the factory engines. The twenties were roaring in more ways than one and Australia enjoyed some outstanding trade figures, and many personal fortunes were made in this one decade. In 1919 we recorded the highest wheat export sales ever, sending a much-needed and very positive message back to the bush.
The struggle between the factory owners and workers was now more of a donnybrook. Socialism was being hailed as the saviour of the worker and thousands joined with the International Workers of the World, the International Socialists and the Communist Party of Australia. Strikes continued to erupt on the minefields, railways, wharves and factory floor. Women were also questioning their unfair ‘second class’ wages. Unionists were jailed, leaders condemned, governments sacked and still the money-go-round boomed as if oblivious to the plight of the worker.
The Wall Street crash of 1929 was reported here but America seemed far away so we returned to the swinging Charleston and the Lindy Hop.
The Great Depression hit Australia in 1930, later than the rest of the world, and harder. The land of milk and honey had hit a very sour note. Factories and commerce tumbled, workers were thrown onto the street to walk the Hungry Mile and live in makeshift box towns. Inner city suburbs like Sydney’s Paddington and Pyrmont, and Melbourne’s Brunswick and Carlton, became hideous slums. This was our biggest and most bitter bust.
We struggled on and eventually got back on our feet, rolled up our shirtsleeves, and started work again. The share market was still very shaky and in 1937 the Australian Associated Stock Exchange opened to unify the even shakier state exchanges. A year later the first Share Price Index was established. We were starting to regain confidence and looking for boom times again.
The impending WW2 sent us a message of unity and necessary endeavour. We had to really work to prepare ourselves with what seemed inevitable. We were ready when the bugle sounded and we took our part well as Bluey and Curley led the charge. The war was difficult for the economy but we had grown-up considerably as a nation and as an economy. There were more of us, we had better housing and living conditions, our rural sector had revived and our factories were still steaming, even if they had to meet the demands of war. Women joined The Land Army to keep our farms operating.
Some businesses boomed during the war and cries of ‘profiteering’ were not uncommon as labour and management resumed their local fight. After WW2 we looked around with a mix of despair and optimism. Returned soldiers were given misguided encouragement to work in the bush, women were encouraged to give up there jobs in favour of the returned men, enterprise was encouraged by often peculiar government schemes. We also encouraged migrants as many of the old barriers were reluctantly pulled down. Slowly we shook ourselves, and things started to right themselves. A boom was reported in the housing market as average Australians set their sights on owning a suburban bungalow, complete with a Holden in the garage and a Hills Hoist out the back. The bosses and workers continued to spar as if an old wound had been reopened. There was also the problem of how to settle with the migrant workforce. The average Aussie had the impression that the Poms were taking over, especially as factory foremen. One joke circulated at the time questioned: ‘How do you get 21 British migrant workers into a Mini Minor? Appoint one of them foreman and watch the other 20 crawl up his arse’. Other migrants arrived from foreign lands, especially Greece, Italy and Malta. Many went to the bush to work the land and, as we know, started new businesses, particularly cafes, during this period.
In the fifties a discovery of oil in the Rough Ranges of WA sent the boom market flying in a frenzy that would have made the Beverley Hillbillies proud. The excitement fizzled out when the oil deposits disappointed but we were left with a determination to find new fields and new boom times. By the sixties the roll of Australian millionaires had increased considerably. Why, it was even possible for a man to start his own airline and in 1957 Ansett Airways took to the skies.
In 1961 boom went bust with what became known as ‘The Credit Squeeze’. The share market dipped, business freaked out and consumers panicked, worrying how they would meet the mortgage on their Californian-style bungalows. The seventies and eighties saw the introduction of many governmental economic control mechanisms: shareholder disclosure (1971), security listings (1972), establishment of an Australian Options Market (1976), National Companies and Securities Commission Act (1979), a revised Companies Act (1981) deregulation of stock exchange membership (1982) and, in 1985, the Stock Exchange of Melbourne Limited established the Australian Financial Futures Market. In 1987 the National Australian Stock Exchange (ASX) and National Guarantee Fund amalgamated the six state stock exchanges. If there were to be more booms and busts then these geezers were going to be pushing some of the buttons.
In 1969 another minerals boom was announced with Australia’s own ‘Poseidon Adventure’ (the American movie about the ill-fated ocean liner came out the same year). The nickel mine discovery resulted in frantic trading with the shares starting at one dollar and skyrocketing to two hundred and eighty dollars. Everyone wanted a piece of the action and if they couldn’t afford this one then they would invest in some other mining venture. Shysters ruled supreme and shares were sold for mining companies that hadn’t turned a single shovel of dirt. In 1975 the property market also took a bust and crash mentality as house prices tumbled. In 1987 there were fears of another major stocks and bonds crash as the share market went south for a holiday.
Minerals have always been good for Australia but so have rural land ownership, retailing and the media, all producing significant boom time millionaires including the ‘last name’ mob: Tyson, Kidman, Vesty, Packer, Myer, Holmes a’Court, Hancock, Murdoch and Lowe. There are some last name busts as well with Bond and Skase leading the ‘Greedy Nineties’ ratpack. The cycle keeps turning as new boom mentality hits dotcom, childcare, snack foods, surf wear and so many other areas of relatively new business. Hands up all those who invested in early dotcom enterprise and lost their shirttails! So, here we are in the twenty-first century looking back over the years on a money-go-round ride that is our longest boom ever. Should we hop off cautiously or wait until we fall off with a thud?