Royal Reels: Gambling


This long cover has a blue BY AIR MAIL vignette, and the three red 2d KGV heads are postmarked SHIP MAIL ROOM/ 12 AP 32/ MELBOURNE. The letter was addressed to The Honourable the Prime Minister, Canberra, Australian Capital Territory. For all ‘the world-to-see’ the sender has prominently written “Dear Joe since you are so hard up you cant reduce the postage. I have put 4d extra on this.” The reverse was not seen (Figure 1).

Joseph Lyons, schoolteacher, premier and prime minister, was born on 15 September 1879 at Stanley, Tasmania, son of Irish-born parents Michael Henry Lyons and his wife Ellen, née Carroll. His early education was at St Joseph’s Convent School, Ulverstone. Michael Lyons had little success as a hotelkeeper, farmer, butcher and baker. In 1887 he lost all of the family’s money speculating on the Melbourne Cup. He suffered a breakdown and became unable to care for his wife and eight children. When 9 years old, young Joe helped to support the family by working as an errand boy, farm labourer and printer’s devil for the Coastal News at Ulverstone. He was saved from drudgery by two aunts, the Misses Carroll, who supported him when he returned to school at 12.

Fast forward: To find out what was bothering the sender of the letter, who wasted four pennies on stamps, (for postage within Australia was only 2d for a 1 oz. letter), I started researching Lyons career in the early 1930s, at the height of the Great Depression. He had left State politics as Premier of Tasmania and became the acting Treasurer in Federal politics. He was imbued with respect for conventional economics and orthodox finance; he equated government debt with personal debt and insisted that all commitments had to be fully honoured. He opposed inflation and stressed the importance of balanced budgets and insisted that all commitments had to be fully honoured.. Lyons attended the meeting of Federal and State leaders which adopted the Melbourne Plan, designed to adjust the Australian economy to the impact of the Depression. A British financier described Lyons and Prime Minister Scullin as ‘entirely at sea … like a couple of rabbits popping their heads out of the hole’. Despite lack of experience in federal fiscal administration, Lyons assumed responsibility to implement the Melbourne Plan which hinged on budgetary restraint. In the absence of Prime Minister Scullin in London, Lyons and the acting Prime Minister, James Fenton took the full brunt of criticism within caucus. Lyons was forced to defend orthodox policies against the radicalism of those caucus members who supported the New South Wales Labor leader, Jack Lang.

He was prepared to accept a degree of controlled credit expansion to stimulate industry; he proposed to balance the budget, and to reduce government spending, wages and possibly pensions. Lyons presented a plan prepared by the Treasury, proposing the unpegging of exchange rates, stabilization of internal prices through monetary control, reduction of interest rates, and provision of Commonwealth Bank credit for industry. His proposals were rejected in favour of Theodore’s more sweeping proposals for credit creation.

Lyons voted with the Opposition, but he returned to cabinet and threatened resignation if the salaries of senior public servants were not reduced. He won on this issue, but the larger conflict over economic policy was not resolved. Against the advice of Lyons and Theodore, caucus voted to postpone repayment of an overseas loan falling due on 15 December. Lyons said that he would not implement this decision, threatened resignation and went ahead with plans to convert the loan. Scullin endorsed his actions in cables and publicly praised him, enabling him to defy caucus, which deferred further debate.

Now fast forward: Lyons quit the Australian Labour party (ALP), co-founded the United Australian Party (UAP) and won his first term in the general election decisively in December 1931 and was sworn in as Prime Minister on 6 January 1932. He won the general election of September 1934 but in October 1937 he was forced into a coalition with the Country Party. By late 1938 to early 1939 he was ailing and died in office of a heart attack in Sydney on the 7 April 1939, and was buried in Devonport, Tasmania.

Australia made a slow recovery from the Great Depression of 1932-1939. Lyons chief success as Prime Minister was to restore stability to the government following the onset of the Great Depression, and the turbulent events surrounding the ALP split of 1931. He also succeeded in holding the UAP together for seven years. As Prime Minister he had considerable public appeal, his reputation as a ‘family man’ helping him in this regard. His family was the first to occupy the Prime Minister’s Lodge as a family home. A photo of Joseph Lyons is seen in Figure 2.

The short answer to the original question was that Lyons was faced with 2 major problems, one profound economic problems, and the other, political squabbling of a degree hardly ever found since in Australia.

I am indebted to the Australian Dictionary of Biography for most of the information on Lyons.

Categories: Political