She was thirty-two years old, drifting and beautiful when she went to the Argyle on 3 April. McMahon was twenty-four years older, pre-occupied with politics, fit, but hardly handsome. He was apparently smitten from the beginning. He later said that Menzies had advised him to marry a long while before. ‘I ignored his advice for seven years, until I met Sonia. That was it.’30 Her feelings took longer to bloom. ‘It was gradual,’ she said.31 Nonplussed, he pursued her over the course of the year. There were dinners and dances, many of them at the Coachman, a restaurant in Redfern. ‘Moon River’ became their song.
The fervour of the relationship was surprising. The speed with which it moved prompted suggestions that it was politically motivated. Kelly had once mentioned to McMahon that it would be very hard to become deputy, let alone leader, as a single man. ‘Are you telling me I should get married?’ McMahon asked.
‘Well, I think politically it would help,’ Kelly replied.
McMahon’s response was firm: ‘I’ll decide that, and I don’t need you to advise me.’32
Politics still remained in the front of his mind. Only four days after meeting Sonia, McMahon was in a vital cabinet committee meeting arguing whether to send a battalion of Australian soldiers to Vietnam. (After all but ‘breaking his neck’ to get on the committee the year before, the introduction of conscription had forced Menzies to invite him on.)33 US delight at Australia’s decision to introduce conscription in 1964 had now been replaced by an expectation that Australian soldiers would soon follow. Menzies was willing: as he said at another meeting, Australia was looking for a way into the conflict, not a way out.
McMahon, however, was not so willing. At the meeting, he aligned himself with Hasluck’s position. He was in favour of delaying a decision on sending troops until American strategy became clear. Overruled by Menzies, McEwen, Holt, and Paltridge, the confidential decision was made to provide a battalion as ‘an act of faith’ once a formal request was received.34 Three weeks later, only a day short of the South Vietnamese government making that formal request, Alan Reid broke news of the decision in The Daily Telegraph. Given his links to Reid and the relatively few people who knew of the decision, McMahon seemed a likely source of the leak.35
There were other issues, too. In the wake of the 1961 election, Menzies had promised to establish a ‘Committee for Economic Enquiry’, tasked with investigating ‘proposals for major developmental projects’.36 It was a way of answering the critics of the government’s economic standing, but, dilatorily, Menzies failed to appoint its members for another year. It took until January 1963 for a chairman, in the form of Dr James Vernon, managing director of the Colonial Sugar Refining Company, to be appointed, with Sir John Crawford (formerly of McEwen’s Department of Trade) as vice-chairman. Over the following two years, the committee provided confidential drafts of its report to the Treasury, which reacted warily to the growing scope of measures that the committee recommended. What most caught the Treasury’s eye was the recommendation that a standing committee be created to review and advise on Australia’s economic growth: unsurprisingly, the Treasury took a dim view of a body that could challenge it. John Stone, for example, thought the report and the committee was a ‘naked grab for power’ by Crawford.37
McMahon had been against the committee almost since the beginning. In an unsent letter dated 15 January 1962, intended for Menzies, he wrote of his regret that he had been excluded from the committee, and criticised it on grounds that it would be uninformed by appropriate information and expertise.38 Treasury was aware of his scepticism. In the lead-up to cabinet’s consideration of the finished Vernon Report in August 1965, the secretary of the Treasury, Sir Roland Wilson, wrote to McMahon to enlist his help in opposing it. While the report looked reasonable enough, he told McMahon — moderate in tone, seemingly the work of sensible men — a little digging revealed questionable forecasts and defective predictions:
I am therefore taking the liberty of suggesting … that you might, on this occasion, spare no effort to explain to your colleagues what the projections in Appendix N are all about, and where the Committee has gone seriously wrong in working them out and drawing conclusions from them.39
Wilson left no stone unturned. Peter Kelly recalled that John Stone, one of Wilson’s ‘bright young men’40 in the Treasury, came to brief McMahon on the report. ‘They [McMahon and Stone] were there for four or five hours,’ he said.41 Stone, however, has no recollection of meeting with McMahon to discuss the report. His views on the Vernon Report, he said, were set out in the cabinet submissions that were drafted for Holt. ‘They gave credit where credit was due and derided factual or analytical sloppiness wherever they (not infrequently) occurred.’42
The efforts were effective. In cabinet on 12 August, Holt read a long submission attacking it. Peter Howson, the minister for air, believed that the report, through Crawford’s part-authorship, presented affairs as McEwen saw them. ‘This is a continuation of the battle between Treasury and Trade that has been going on for ten years,’ he wrote in his diary. ‘Harold feels his reputation is at stake, and therefore, to an extent, his chances of becoming Prime Minister.’43 McMahon backed Holt up, homing in on the weakness of the projections that Wilson had pointed out to him. McEwen was not present to defend the report, which he regarded as ‘a good objective analysis of the Australian economy’; he was overseas, and he and Crawford rued the missed opportunity to defend it.44 Maxwell Newton, no doubt writing from McMahon’s retelling, printed in his newsletter, Incentive, that McMahon had ‘delivered a stinging attack’ on the report.45 Not long afterward, decrying the committee’s supposed intrusion into political matters, Menzies rejected the report in a long, scathing speech in the House.46
Positioning for Menzies’ retirement was going on in earnest throughout 1965. The prime minister was seventy years old and the unquestioned supreme chief of Australian politics. Rivals were gone, even rewarded: Richard Casey had retired in 1960 and become governor-general in July 1965. Harold Holt’s succession was all but assured: Garfield Barwick had given up on hopes of succeeding Menzies, and departed to be chief justice of the High Court, with McMahon’s urging,47 and Paul Hasluck had not yet gained the prominence to be a strong candidate for the leadership. There were questions only about the deputy leadership and the rungs below that.
One opportunity for McMahon to begin laying claim to the deputy leadership lay in the public service marriage bar. Since its last consideration in cabinet, spurred as much by the lobbying of Bland and his understanding of the labour market, McMahon had begun moving in favour of its removal. In September 1964, he told a Brisbane audience that there were jobs ‘women can do as effectively as men’ and that it should be up to a woman individually to decide whether she should take a job.48 ‘The Commonwealth cabinet’s perennial bachelor and the hope of single ladies in Canberra,’ wrote The Courier-Mail the next day, was now ‘gallantly carrying the lance for married women.’49 A year later, following a public protest by Merle Thornton and Rosalie Bognor, who chained themselves to the bar of Brisbane’s Regatta Hotel to protest against the marriage bar, McMahon told Bland he was now ‘quite prepared’ to press for its removal.50 That same day, he publicly attacked the ‘Victorian attitude[s]’ held by industries and employers.51
Another opportunity for McMahon to gain the esteem of his colleagues began on 30 July, when the WWF announced its decision to carry out a series of twenty-four-hour stoppages, nationwide. Pensions were the union’s principal grievance. Claiming that the regular pension was inadequate, the WWF argued that the highly profitable shipping industry had both the responsibility and ability to look after its workers, just as other countries did. The union’s participation in the 1963 working party had come with some hopes of discussing pensions, but those hopes had been dashed. In October 1964, the WWF resolved to concentrate on the issue. Five months later, a delegation of workers and union representatives put their case to McMahon, but went away empty
-handed. A series of small stoppages in April 1965 achieved nothing. Conferences initiated by the Conciliation and Arbitration Commission broke down in May. The government and employers blamed the WWF for not considering any proposals but pensions; the WWF blamed employers for their suspicious offer of permanent employment, which it called ‘a smokescreen to cloud the issue’.52
Man-hours lost to stoppages rose, fuelled by the anger about pensions, protests against apartheid in South Africa, and military involvement in Vietnam. McMahon, angered and concerned that the waterfront could become unmanageable, announced on 22 June that an inquiry would be held into the stevedoring industry. To be conducted by A.E. (‘Ted’) Woodward, a Queen’s Counsel who had acted as junior counsel for the Victorian and Commonwealth governments and opposed the ACTU in long-service leave and national wage cases, the terms of reference for the inquiry were wide-ranging. Efficiency, discipline, redundancy, industrial disputes, permanent employment — all the issues, in effect, that had proved nearly intractable on the waterfront for years — were to receive studious investigation. ‘Mr Woodward will commence the inquiry as quickly as possible,’ McMahon said.53 Perhaps unaware that the most recent inquiry into the waterfront had taken two-and-a-half years, McMahon promised that Woodward would be finished ‘in about three months’.54 Woodward was unimpressed with the timeframe and the connotations it gave — namely, that the result was known in advance.55 The WWF, neither unreasonably nor groundlessly, saw the inquiry as an attempt to provide cover for a punitive forthcoming attack by the government. ASIA chairman, Norman Hood, was of a similar mindset.56
They were correct. Bland had supposedly been laying the groundwork for a clash with the WWF for some time. ‘I’d been waiting for years to go after the WWF,’ he later claimed. Deciding that the employers could not be relied upon to ‘stand firm’ against the pensions campaign, he apparently told McMahon in March 1965 that it would be ‘disastrous’ to concede to demands for pensions without some quid pro quo on the part of the union movement. Seeing no special reason for a pension within the industry anyway, Bland argued that the WWF’s demands were ‘sheer industrial pressure’ that could easily continue: ‘What I am raising in effect is the fundamental issue — whether we should not resist the present claim, even if it means a head-on collision.’57
Bland’s willingness to bring on that collision was spurred by a chance discovery. In a conversation with Hood, Bland learned that the Melbourne branch of the WWF had apparently recruited a number of men with extensive criminal records. In any dispute, Bland realised, this information could torpedo public sympathy for the union and help to isolate it. After all, how could the ACTU stand shoulder to shoulder with thugs and criminals?58
Sometime in the intervening months, without McMahon’s knowledge, Bland supposedly went to Menzies for a meeting. He was mindful that the prime minister had won his spurs appearing as the sole advocate for the Amalgamated Society of Engineers in 1920, and was thus familiar with industrial relations; he was also aware that Menzies knew about McMahon’s propensity for leaking. After briefing him on his proposal to tackle the WWF, Bland asked Menzies to put McMahon ‘under proper control’:
I put it to R.G. [Menzies] that he ought to call a meeting of McMahon and me, tell us that he was concerned about the situation and that he thought that action should be taken, that is to say action on the lines that I’d indicated to him, and that he should say to Billy that the whole exercise demanded a higher order of secrecy and that if Billy was as much as to open his mouth he’d be fired from the cabinet.59
In what Bland described as ‘a most remarkable exercise’, Menzies supposedly went along ‘with relish’. At the subsequent meeting between the three men, Menzies laid out the course of action, noted the stakes, and then waved his finger at McMahon: ‘If there is any leakage of this I will assume that it came from you and I’ll fire you.’60
According to Peter Kelly, however, McMahon’s resolution to take on the unions had nothing to do with Bland. Kelly recalled bringing a departmental minute to McMahon’s attention that, he said, recommended ‘complete capitulation’ to the WWF and its strikes. McMahon agreed with his view — but asked what he suggested.
‘I think the only way you can do this is to take the communists on,’ Kelly told him. ‘There’s no way around it, because they’ll just keep increasing their demands, in other unions.’
McMahon was initially hesitant and understandably wary, but he quickly came around once the political benefits were pointed out.
‘Anyway, as you want to be treasurer,’ Kelly told him, ‘this would give you a lot more strength. If you’re seen to be quite strong and take them on, it would advance things more considerably.’
According to Kelly, when Bland was told of McMahon’s decision to take on the communists, he became completely unavailable to McMahon. He cut off contact. ‘He hid from McMahon for about three or four weeks,’ said Kelly. ‘You just couldn’t contact him. Couldn’t find him anywhere.’61 In his memoirs, McMahon would echo this: Bland disagreed with the idea of taking on the WWF. When McMahon insisted on persevering, Bland told him that he would wash his hands of the matter. The responsibility for it would be McMahon’s.62 Bland’s claims — about initiating the moves himself — were simply false. ‘That is complete bullshit,’ Kelly said of Bland’s claims.63
Whether he disagreed or not, Bland was still preparing the way. On 1 August, he wrote to McMahon to ask him to dissuade the Liberal MP Tom Hughes from debating WWF official Norman Docker on television. ‘From now on we have to be sure that we win every battle,’ he wrote. ‘We cannot afford to lose one.’64 He asked Hood to survey the kind of cargo that would be arriving in Australia in the next few months, and to check the criminal records of all people the WWF had submitted to ASIA for registration in Sydney and Melbourne.65 He wrote to Ted Hicks, secretary of the Department of Defence since 1956, to request information on the availability of service personnel from mid-August onward, in case of a national stoppage on the waterfront.66 Bland also harried departmental staff for ASIO intelligence:
It is desperately important that we have the most up-to-date intelligence as to what the Communist Party is up to. We want to know why it has selected this time for a head-on collision with the government and what bearing this has on a general attempt to get control of the trade union movement. In short, we want every scrap of information that we can get that has any relationship to the ultimatum the Federation has given us on the waterfront and to trade union activity at large.67
On 3 August, Bland prepared a long letter for McMahon to send to Menzies outlining in great detail the proposed course of action. In a separate letter to McMahon, sent the same day, Bland covered the possible consequences of the proposed action against the WWF. Those consequences could spread beyond the waterfront, he warned, and they could be dire. ‘Sydney’s gas supplies could be cut off,’ he noted, by way of example. Throughout the letter, he fortified his minister. The showdown would pay off: ‘It took six months of fearful disruption in New Zealand in 1951 to clean up the waterfront. But there has not been any worthwhile trouble since.’68
The same day, the Conciliation and Arbitration Commission rejected an ACTU application to reconsider that year’s national wage decision, which had been all but frozen. The decision prompted an inept statement from Docker. He declared that there was ‘no future’ in the commission and that suggestions for further arbitration were foolish and misleading. ‘We are fighting the government on these matters,’ he said. ‘They have mounted a vicious campaign against us, but we shall win.’
That quote was on the second page of McMahon’s cabinet submission that was circulated at the end of August. Recapitulating the decades-long unrest on the waterfront, the submission pinned much of the blame on militant, communist-tinged leaders like Docker, who, it claimed, controlled the WWF. The submission was designed to anger, provoke, and stiffen the resolve of its small readership. There was n
o prospect of a deal ‘on any reasonable basis’, it claimed, and thus the government was at a ‘crossroads’:
Are we to keep on manoeuvring within the present system, with experience to tell us that no lasting solution will be achieved, that the Federation will, under its Communist controllers, continue to resort to direct action, that there will never be stability on the waterfront and that we will continue to face adverse effects on our economy and our overseas trade? Or are we now to attempt a radical solution of the difficulties, recognising the dislocation we may have to face?69
The submission recommended dramatic changes. It removed the WWF’s power to recruit workers and gave it to ASIA. It mandated that employers appropriately supervise stevedoring operations. It strengthened ASIA’s power to suspend and deregister wharf workers. These were but the stepping stones to the biggest changes: the minister would have the power to ask the Conciliation and Arbitration Commission to deregister the WWF, to strip the union of its rights and privileges under the Stevedoring Industry Act, to strip it of its rights to represent a member, to terminate any lease the WWF had with the Commonwealth or ASIA, and to register unions in place of the Federation.
Drafted in large part by Bland, McMahon contributed ‘some deft touches’ and, in the cabinet debate in the evening of 1 September, he won the support of his colleagues.70 Holt congratulated him on the paper and the ‘courage’ of his approach, and told colleagues that he had known ‘in his bones’ that at some stage the government would have to act on lines suggested by McMahon. Menzies agreed: ‘We don’t avoid the ultimate conflict by evading the first — we tackle the first, but we must win the first.’71 Cabinet approved the ‘course of radical change’ that McMahon’s submission recommended. It asked that those changes be enacted quickly, that the ‘public mind’ be prepared, and that contingency plans be put in place for the disruptions that might occur.72
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