Dnever it's only a worry if the information pubished is factually wrong...that article was right on the money

I lived through the Whitlam debacle as an adult

His Government was an economic disaster as recorded by that article

Everything went crazy...Whitlam's stooges were even trying to borrow money from the Muslims when they ran out of money

Whitlam spent like a legless sailor the only one who has managed it since is that egomaniac Kevin Rudd

Kerr may have sacked the Government but the public showed what they thought at the ensuing two elections they gave Labor the short shrift and brother didn't that false prophet Whitlam deserve it

red baron wrote on May 18^th, 2017 at 2:36pm:

That is ancient history because no member of Parliament from that time is still serving, so the record from then is largely irrelevant now.

Whitlam's economic management could certainly have been better, but there were very significant external factors at the time. The mid 1970's was the time of the oil shock, when rapidly rising oil prices caused stagflation (high inflation in a stagnant economy). No government anywhere in the world had ever experienced stagflation before, it wasn't even economic theory until it happened and nobody anywhere knew how to deal with it. Dealing with inflation by raising interest rates makes the economy worse; dealing with the economy by lowering interest rates increases inflation. Therefore, any government that has to deal with stagflation is stuck between an economic rock and a hard place.

Incidentally, Whitlam's government brought down three surplus Budgets out of three.

Copntinued:
The Organisation of Petroleum Exporting Countries oil price hikes of 1973 had sucked billions of dollars into the Middle East. Many emirates were looking for places to invest money. But anyone wanting cheap loans had to discern the respectable bankers from the carpetbaggers.

The next morning Dean rang back. The Bank of England thought the loan was "funny money".

"The bank says that such large sums are simply not available from the Middle East, the Vatican, the Mafia or anywhere else," Dean told Hay.

Dean even spelt out the modus operandi of such middlemen. They would inject the deal with secrecy and urgency with a view to quickly obtaining a written commitment from the prospective borrower.

"Once this is done, the borrower usually realises that the deal is not going to be concluded and proceeds to back out of the contract," reads Hay's report of his conversation with Dean. "This in turn usually means that the prospective lender is legally entitled to claim the commission . . . without the lender having to produce one cent of loan funds."

Furthermore, Khemlani's London-based company, Dalamal and Sons (Commodities) was a new company with capital of just ££100. Its name was strikingly similar to an established, respectable firm, Dalamal and Sons, London. Hay asked Dean to contact British police to see what they knew of Khemlani. They knew nothing to confirm or deny his legitimacy as an global borrowing agent.

It took Treasury just a few phone calls to establish that Khemlani was, almost certainly, a fraud. The government had apparently satisfied itself with assurances from Sir Lenox Hewitt, head of Connor's department, that he had "checked on the bona fides of the persons negotiating the loan and is completely satisfied that the money is available", according to a Treasury memo.

Incredibly, the Treasury documents reveal that Sir Frederick Wheeler deliberately did not tell Cairns that the Bank of England thought the loan was a scam. Wheeler told one of his colleagues he "stood by his judgement" and that the information "would come out in another way". It appears that the mistrust was strong enough that Wheeler felt he could not alert the government to Treasury's covert inquiries.

On December 13, Wheeler registered Treasury's official opposition to the loan in a terse minute to Cairns.

That night Whitlam, Connor, Cairns and attorney-general Lionel Murphy held an Executive Council meeting, needed to give the loan legal authority. The other three empowered Connor to borrow up to $4 billion "for temporary purposes". The next day Whitlam headed overseas.

Debate has raged about whether the four did anything illegal that night. The phrase "for temporary purposes" brought the government untold strife. As the documents show, the original draft of the Executive Council minute said the money would be used to secure Australian ownership and control of its mineral and energy resources.

By this definition, the loan needed approval of the Loans Council, a body on which the states sat. Four states were non-Labor, and would almost certainly have vetoed the loan.

But by defining it as for "temporary purposes" - tenuous, given it was over 20 years and for large projects - the government could avoid Loan Council and parliamentary scrutiny.

The Executive Council minute was changed to say the loan was "to deal with exigencies arising out of the current world situation and international energy crisis, to strengthen Australia's external financial position, to provide immediate protection for Australia's supplies of minerals and energy and to deal with current and immediately forseeable unemployment in Australia".

The Attorney-General's Department advised that any state could challenge the loan in the High Court and would probably win. Cairns, who had been sceptical about the Khemlani proposal from the outset, said it was foolish to hide it from the states. It would come back to bite the federal government. He was ignored.

In the days that followed, the mechanics of the deal ground on. Despite still not knowing the identity of the lenders or where the money was being held, the government drafted a letter of acceptance, which Connor gave to Khemlani. Khemlani's behaviour grew more suspicious. He asked to have clauses in the documentation relating to his commission changed.

He insisted on a "show of strength" from the government in the form of a firm deal that he could take to his mysterious money lenders. His aims, Treasury guessed, were two-fold. When the government was inevitably forced to pull out of the bogus deal, Khemlani might try to extract his commission.

The second, and greater, fear was that Khemlani would use the letters Connor had given him to secretly drum up loan funds abroad that he could try to pitch to the government in place of the non-existent $4 billion. Australia's good reputation in international capital markets could be shattered if a man like Khemlani ran around claiming authority to negotiate loans for the Australian government.

Treasury's Alan Bailey ruefully told a colleague: "I'll never be able to show my face in Europe again."

At 10.15am on December 16, the Reserve Bank of Australia governor rang the president of the US Federal Reserve, who was worried that such a large amount in one lump sum would disrupt markets. Australia needed to have the loan paid through the US Federal Reserve bank.

The president's reaction to the deal was striking. Like the Bank of England,