THE AUSTRALIAN SETTLEMENT’

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This term (popularised only towards the end of the twentieth century) refers to a network of concepts and policies about which there was a general consensus among policy makers and which, together, underpin the development of Australia as a nation (including its economic development). (It is important to understand that this was not a ‘Settlement’ in any formal or legal sense, but rather a set of ideas that underpinned the evolution of Australia as a social and economic entity.)
Accounts of the different strands that made up ‘The Australian Settlement’ vary, as do the relative significance of different strands. However, it is widely accepted that prominent, perhaps foremost, among these were policies that related to economic activity. In these the common thread is the notion of achieving goals that differed to those that would arise from unregulated economic activity (what in more modern-day parlance would be described as ‘free markets’). The common theme was the ‘protection’ of participants from undesirable consequences of unregulated economic behaviour.
One of (if not the) most influential of the set of ideas that made up ‘The Australian Settlement’ was that of trade protection. This policy would enable the development of a domestic manufacturing industry, in this way allowing the development of a more broadly-based economy and freeing the people from being (as the Australian prime minister for much of the 1920s was fond of expressing it) ‘mere hewers of wood and drawers of water’ (or, as some saw it, just rural peasants of the British Empire, producing the land-based products necessary to allow the homeland to further its process of industrialisation).
The principal mechanism of the policy of trade protection was the tariff, a tax on imports (nearly all of which were manufactured goods). The tariff served to make imports relatively more expensive and thus encourage the development of Australian manufacturing industry.
The scope and extent of tariffs was greatly expanded during the decade of the 1920s (although the origins of the policy can be traced back to before WWI) and then, in the context of the Depression in the early 1930s.
The policy (although as noted in the Topic Notes it was in some ways paradoxical in so far as an attempt to develop a more broadly based economy conflicted with the view of Australia’s ‘place’ in the British Empire) was to underpin, indeed be the key element in, Australian economic history for several decades until it was abandoned in the 1980s.

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