A little piece of earth
The post war reforms to housing policy are among the Menzies government’s greatest legacies, argues nick cater in this extract from his chapter in menzies: Success, failure, resilience 1894 - 1942.
Menzies’ enduring legacy is a strong and prosperous home-owning middle class, the very people to whom The Forgotten People speech was addressed and whose interests Menzies sought to further through removing the burden of intrusive government from their backs and policies that fostered the instinct “to strive, to seek, to find, and not to yield.”
The year 1942 was also a pivotal moment in the battle of ideas. It drew the battle lines between competing notions of nation-building, determining the path Australia would follow after the war. It would take another seven years and two federal elections to decide the victor in that contest. Two seminal contributions to civic debate in 1942, however, laid the intellectual groundwork for what was to follow. Both contributions attempted to chart a course to create a prosperous and more just future once the war had been won. The means to achieve that end, however, was diametrically opposed.
The first was Menzies’ Forgotten People radio talks, republished as a booklet by Melbourne publisher Robertson and Mullens and circulated at the company’s expense. It would be republished in 1938 by Angus and Robertson in a volume of all 38 radio talks given by Menzies in The Forgotten People series between May and November 1942. The series encompassed a range of topics including freedom, inflation, censorship, the alliance with the US, the nature of democracy and the drink problem. All, however, elaborated upon a consistent philosophical argument: that individualism was a more effective and more human organising principle than collectivism.
The second contribution was the Beveridge Report, which was published in London on December 1, 1942. The report was soon circulating in Australia where it was much discussed. The report’s author, economist and Liberal politician William Beveridge, had been commissioned by a Labour minister in the wartime British government, Arthur Greenwood, to conduct a survey of existing national schemes of social insurance, including workmen's compensation, and to make recommendations as to how they might be improved.
Beveridge, like Menzies, recognised the shortage of housing and the poor quality of much of the housing stock as one of most urgent post-war challenges. In contrast to Menzies, however, Beveridge argued that the solution was social housing, not encouraging private ownership. His mistake was compounded by his determination to bulldoze sub-standard inner-city terraces and tenements and move entire communities to predominantly high-rise estates built on green field sites on the edge of cities. It was a recipe for social disaster which was to blight the lives of generations of renters to come.
In The Forgotten People, Menzies foreshadows the post-war reforms to housing policy and education which rank among his government’s greatest legacies. Indeed, the opening section of the speech is given over to lyrical description of homelife, emphasising the social, economic and moral value of home ownership. He speaks of the home as “the foundation of sanity and sobriety” which “determines the health of society as a whole.” The act of saving for one’s own home is a “concrete expression of the habits of frugality and saving.”
“Your advanced socialist may rave against private property even while he acquires it; but one of the best instincts in us is that which induces us to have one little piece of earth with a house and a garden which is ours; to which we can withdraw, in which we can be among our friends, into which no stranger may come against our will.”
The word “home” in its singular or plural form appears 21 times in the speech, making it the second most common noun after “people”. It was delivered against the background of a tightening housing market, exacerbated by a wartime shortage of labour and building materials, that would become acute by the end of the decade. There was also social concern about the quality of housing stock and the provision of basic amenities, like water, sanitation and electricity. In 1947, more than half of Australia’s private dwellings (52 per cent) were without a flush toilet and 48 per cent of metropolitan households lacked an electric or gas stove. Outside the major cities, 31 per cent of homes lacked electricity and in 77 per cent of homes, food was cooked by burning wood, coke or coal.
Source: Australian Bureau of Statistics, Census, 1947, pp. 2003- 2005.
Labor would be slow to respond to the housing issue. In the 1946 election it was part of Menzies’ key platform, but was barely mentioned by prime minister Ben Chifley, perhaps on the assumption that it was a matter for the states. Labor’s policy as it developed focussed on federally funded housing programs administered by the states that would provide a mixture of social and planned private housing, similar to the post-war policy pursued in Britain.
Menzies, by contrast, sought to empower people of modest means to buy their own homes. In his 1949 election speech, Menzies pledged to amend the Commonwealth-States Housing Agreement “so as to permit and aid ‘little Capitalists’ to own their own homes.” The effect of Menzies’ policies over the next 16 years was to increase the rate of home-ownership from 50 per cent to 70 per cent, leading to the growth of suburbia that so enraged intellectuals like Ronald Boyd, Ronald Conway and Donald Horne in the 1960s and inspired the creation of Australia’s greatest comic figure, Dame Edna Everage.
Between 1947 and 1966, the housing stock in metropolitan Australia doubled from 961,000 homes to 1,987,168. Homes were being built faster than the growth in population, reducing the size of the average Australian household from 4 people in 1947 to 3.3 in 1966.
Home affordability remained relatively stable throughout Menzies’ period in government at the equivalent of around 250 weeks of earnings on the average wage.
Post-war legacy
The influence of Menzies’ policies that sought to empower the middle class were profound. It was to set the tone for post-war policy that influenced Labor governments as well as Liberal. The economic de-regulation policies pursued by the Hawke and Keating administrations were close to those pursued by the Thatcher and Reagan administrations in intent, if not in detail.
While Labor’s superannuation reforms were an adjunct, rather than a replacement, for the state pension system, they recognised the value of personal savings for retirement in terms Menzies would have applauded. Yet the contribution of superannuation savings to retirement wealth is dwarfed by the wealth accumulated in private housing. In 2019, the estimated value of private housing in Australia was $6.5 million, more than twice the value of superannuation funds at that time ($2.7 trillion) and more than three times the value of Australian-listed stocks ($2 trillion).
This is an edited extract of Nick Cater’s chaper in The Young Menzies: Success, Failure, Resilience (1894 - 1942), edited by Zachary Gorman (MUP). Buy the book here
