On 19 March 1932, Lang opened the Sydney Harbour Bridge. Lang caused some controversy when he insisted on officially opening the bridge himself, rather than allowing the Governor, the King's representative in NSW, to do so. He delivered what has come to be regarded as a landmark speech in Australian political history during the Opening, citing the theme that the completion of the Sydney Harbour Bridge was analogous to the history, development and dreams of the Australian nation and its people. It may be inferred that this speech depicted Lang's personal vision of the past, present and future of New South Wales and Australia's place in the British Empire and world, (to read this speech, refer to 'Stirring Australian Speeches', edited by Michael Cathcart and Kate Darian-Smith). Just as Lang was about to cut the ribbon to open the Sydney Harbour Bridge, Captain Francis de Groot, a member of the paramilitary New Guard movement, rode up and broke the ribbon. The New Guard also planned to kidnap Lang, and plotted a coup against him during the crisis that brought Lang's premiership to an end.

The Crisis of 1931-32

    Early in 1931, Jack Lang released his own plan to combat the Depression; this became known as "the Lang Plan". This was in contrast to the "Melbourne Agreement" which all other State Governments and the Federal Government had agreed to in 1930. Key points of the Lang Plan included the reduction of interest owed by Australian Governments on debts within Australia to 3%, the cancellation of interest payments to overseas bondholders and financiers on government borrowings, the injection of more funds into the nation's money supply as central bank credit for the revitalisation of industry and commerce, and the abolition of the Gold Standard, to be replaced by a "Goods Standard," whereby the amount of currency in circulation would be fixed to the amount of goods produced within the Australian economy. The banks had indicated that if he paid the interest they would advance him an additional amount which was greater than the interest, thus giving him a positive cash flow.

    Lang opposed the Premiers' Plan agreed to by the federal Labor government of James Scullin and the other state Premiers, who called for even more stringent cuts to government spending to balance the budget. In October 1931 Lang's followers in the federal House of Representatives crossed the floor to vote with the conservative united Australia Party and bring down the Scullin government. This action split the NSW Labor Party in two - Lang's followers became known as Lang Labor, while Scullin's supporters, led by Chifley, became known in NSW as Federal Labor. Most of the party's branches and affiliated trade unions supported Lang.

    Since the Commonwealth Government had become responsible for state debts in 1928 under an amendment to the Constitution, the new UAP government of Joseph Lyons paid the interest to the overseas bondholders, and then set about extracting the money from NSW by passing the Financial Agreement Enforcement Act 1932, which the High Court held to be valid. Lang then contended that the Act was rendered null and void by contravening the 1833 prohibition of slavery throughout the British Empire; the Premier held that the actions of the Lyons government deprived the State of New South Wales of paying the wages of State employees and that this necessarily constituted an (illegal) state of slavery.