Search

Leslie Jauncey, Australia’s Government Bank, 1933

Leslie Jauncey was an Adelaide-born author and economist who moved to the United States as a young adult. There he received a PhD in economics from Harvard, taught the subject at the University of New Mexico, and served as a research assistant at the Harvard Business School. A man of radical politics who sought to reignite ‘the spirit of Eureka’, Jauncey notably spent some time in Soviet Russia during the 1930s.

Australia’s Government Bank was a book based on Jauncey’s PhD thesis, and served as a glowing history of ‘the only state-owned commercial bank in the British Empire’, an institution which was intended to support working people and keep the private banks honest. ‘Originally a product of the Labour Party, the bank was intended to assist the ordinary man in financing his projects but during the war the Commonwealth Bank became the foundation of Australia’s financial structure and occupied a key position in the war policy of the Commonwealth. The national importance of the institution has increased since that date so that the Commonwealth Bank has become the centre of Australia’s programme to thwart the depression’.

The book was dedicated to King O’Malley, the eccentric Labor politician said to be the ‘father of the Commonwealth Bank’ for the fight that he led to include the policy in Labor’s platform, even if the Bank’s function and powers had ultimately been made more limited than what he had hoped for. Jauncey and O’Malley were natural friends, since they were both radical thinkers with a close association with North America, the latter famously and somewhat spuriously claiming to have been born on Canadian side of the U.S. border (shielding him from the ‘foreign power’ exclusion in Section 44 of the Australian Constitution).

The Menzies Collection has two copies of Australia’s Government Bank, the first given by O’Malley and addressed to ‘Brother Menzies, Great War Prime Minister’. Though the gift is not dated, it was likely given in conjunction with a public appeal O’Malley made in December 1940 to suggest that the Federal Government fund the war effort through a large-scale fiduciary note issue, something which O’Malley claimed was modelled on how Abraham Lincoln had financed the American Civil War (in which O’Malley’s father had allegedly fought and died). The second copy was given by O’Malley’s wife Amy, sometime after 1951, likely in the aftermath O’Malley’s death in 1953 as the last surviving member of the first Federal Parliament.

The gifts show a concerted effort to convince Menzies of the value of the Commonwealth Bank, and the fact that these left-leaning figures thought that Menzies might be won over says something for the way in which they respected Menzies’s intelligence and sense of independence. Indeed, O’Malley is reported to have greatly admired Menzies despite their ideological differences, describing him as the best orator that the Commonwealth Parliament had seen, surpassing the ‘silver-tongued’ Alfred Deakin.

Menzies for his part greatly respected the role of the Bank, but he interpreted that role in more conservative terms than Jauncey or O’Malley. He rejected radical inflationary economic solutions, particularly any that might punish those who had had the foresight to develop savings. Likewise, Menzies was utterly opposed to the efforts of the Chifley Government to extend the Commonwealth Bank’s control over the private banks which ultimately led to the failed nationalisation attempt. Menzies’s 1960 decision to separate the Reserve Bank from any commercial banking activities arguably spelled the end of some of the grander visions that had once been attached to the Commonwealth Bank, but he would still have been shocked by the wholesale privatisation of the 1990s.