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AUSTRALIA is where a man walks tall. The old time name for the native Australian was a Cornstalk. Sometime in the middle of the last century a distinct native Australian could be distinguished. He was hard working, thin faced, rangy, and believed in matemanship.

The cult of matemanship sprang from the need in the outback to rely upon someone who whatever the difficulties would never desert his mate. The life in the outback was harsh; conditions of living from the extremes of climate, the lack of water, the insects, poisonous snakes and the vast distances meant that a mistake would bring death. No one who has travelled across the great deserts can fail to be impressed with the almost super-human hardiness of the early settlers.

Probably nowhere is there a greater misconception amongst the general public about the founding of a country than there is about Australia. The ordinary impression is of convict ships unloading upon the shore in Botany Bay thousands of convicts who then proceeded to work, building cities, roads, and generally laying out the land ready for the time they became free men or their decendants claimed free rights to the cities they had built.

Few convicts had or could have had many descendants. The majority of convicts transported were male; the number of female transportees was very limited. Even today the male prison population outnumbers the female by more than seven to one. As a consequence it was just not possible for a convict to have a family, quite apart from the fact that he was in confinement. Additionally the women convicts tended to be taken by the warders and soldiers as solace for themselves, so any chance that a male convict might have had of creating a line of descendants was very slim indeed.

After the serving of his sentence the convict was either allowed to return to Britain or he was released on a ticket-of-leave system. The numbers who managed to survive their sentence were few compared to the numbers who either died during transportation or during imprisonment.

The claim of right to the ownership of Australia by Britain as terra nova was more of a fluke than a result of calculated planning. The Dutch, Portuguese and the Spaniards all had seen the country and taken no action. All they saw was land, but their hearts were set upon the products of the use of land so they concentrated upon the Far East, upon gold and spices and the results of the labour of people.

Australia was described as a "barren and miserable country" by Dampier, and the inhabitants as miserable people. This was the prevailing attitude towards either the smallest continent or the largest island, whichever way you like to think of it, and where land was free for the taking.

At all periods of recorded history the available supply of land has remained the same, give or take a few square miles. Yet here was a vast, sparsely inhabited area none really wanted until a use was found for it. It was the British who found that use, not as a healthy off-shoot of Britain, or even as a secondary production unit to feed the home country; but as a dumping ground for undesirable members of the community.

The settlement of the rest of Australia was something of a lucky accident. With the concept of a convict colony in the official mind, thoughts turned to the keepers of the convicts and how they should live. There was also the hierarchy of officialdom that supplied the lines of provisions. Many of the first free settlers were parasitic upon the convict community, and the convicts were used as labour to keep their keepers - as nice an example of slavery as you will find in modern times.

Upon what particular point of moral law the British Government reserved the right to itself to sell portions of Australia to the first settlers is hard to say. No doubt it felt that the right of protection under the law was enough to give it the authority to make grants.

To be fair to the government of the day, the first instructions to Arthur Philip as Governor were humane and comprehensive. He was enjoined to cultivate the affections of the natives, and to seek to promote amity and kindness between the members of the colony. There was to be a grant of thirty acres of land to every male convict who was worthy, by virtue and industry, together with stores and supplies to allow him to work the land. Yet at the same time the colony was organised upon the principles of servitude rather than freedom.

For the first half century or more the constant cry from the settled lands was for cheap labour. Cheap labour was convict labour. The land was so vast, the work so great, that no one could envisage any other method of working the land than with slave labour. Where land is restricted, the haves can impose on the have nots, even in an area where there is plenty for all. This situation has not changed. Today there are industries crying out for cheap labour, and claiming that they cannot otherwise survive. It is the same on the land. Farmers try to give good reasons why they should be given cheap labour to save the crop - at the moment of writing, the fruit crop.

The first settlement was built in Sydney cove, Botany Bay having proved unsuitable. An almost immediate alarm that the French would try to gain a foothold on the new continent led to expeditions being sent to settle the danger areas. Gradually free settlers followed in the wake of the early convicts. The first city was, naturally, Sydney.

Henry George paid a visit to Australia and a land restoration league was formed. A lot of hard work was put in, and is still being put in, by members to implement the ideas of Henry George. Site-value rating was established in some areas, to the benefit of those areas. Because of the geometric pattern of the boundaries in Melbourne the actual differences between areas that are site-value rated and those that are not can clearly be seen. A demarcation line of the well kept property on the one hand and the run-down property on the other will be seen to coincide with the civic boundary where the two systems meet. If this were to be seen only in one sector of Melbourne it could be argued that one was guilty of being selective in the choice of one's examples, because one wished to draw this conclusion; but the weight of evidence from all the areas suggests that as the system of rating is the only factor in common, rating on site values encourages improvement. The usual rating system is penal in effect and discourages improvement by charging the owner more. The result is that an owner is reluctant to improve property and gradually the whole standard of maintenance falls. He is caught in a vicious circle. The more he improves the more it costs. If he does nothing he loses on the value of the property as it becomes more old fashioned. Under site value rating this does not occur; he can up-date his property for the cost of the improvement.

The economy of Australia has always been cyclic. From the very first flush of settlement the demand for land in favourable areas created land booms, to be followed by disastrous slumps as people accumulated in towns and cities. In spite of the wealth of acreage thousands of people would not, and still will not, move from the sanctuary of town life. This concentration of population forces the price of property up in the favoured area bringing shortages in housing and work, while in the remote areas property is cheap and labour hard to find. Again there is this paradox; on the one hand a lot of people create a breeding ground for trade and high employment, yet on the other they create social and employment problems.

In each major city the elite congregated in the better areas - those that were the most healthy ,or nearest to transport, or had some feature to distinguish them from the rest, and here land prices rose. With the growth of better communications some of these communities have shifted leaving behind gracious houses which have declined in value. A walk round any town will reveal the history of fashion and economics.

The biggest boom periods in Australian history have been linked with mining. The gold rushes, opal strikes and nickel booms are well known. Opals are again in the news and all the old problems have come to the fore this year in the areas where they have been found. But to go back into history, gold and the romance of the gold fields provides an interesting case study of what can and does happen.

By a quirk of nature the valuable minerals of the earth are located in the harshest and most inhospitable places of the world. Gold is no exception to this rule. How the old time prospectors made their discoveries is another story; maybe some Victorian sentiment that wealth was to be found in suffering sent them into the burning outback to seek fortune and find reward. Bailey found his gold 360 miles east of Perth in September 1892 to set off one of the greatest gold rushes Australia was to know.

At Coolgardie, which today is a ghost town, came thousands of prospectors from all over the world. Land prices rocketed overnight. Food, bedding and water were almost as scarce as the gold itself.

Before the strike there was nothing but uninhabitable desert - no buildings for the lack of materials, no crops for the lack of water, no people for the lack of natural resources. The nearest water was hundreds of miles away. Then came the gold strike. Suddenly this land was desirable.

Daily the town grew. From being nothing it became in a matter of months the third largest town in west Australia. Money poured into the area. Streets were laid out in geometric pattern. Neighbourhoods were named after the places from where the builders came. Newspapers appeared; at one time there were six daily papers. Electric lighting was installed in the streets - no mean achievement at the turn of the century. A pipeline was built bringing water 360 miles.

In the district of Toraak, named after the district in Melbourne, a standard house of the period cost £12,000, a price that even today is good in an ordinary thriving town. The main street had large hotels, public buildings, offices, all strong and substantially built at tremendous cost. An early picture shows crowds thronging the streets, hurry and bustle everywhere.

Then the gold ran out. The people departed, the houses sold for £50 each for the timber in them. Land prices dropped. For years the buildings stood empty and idle until they were pulled down for the sake of the safety of visitors. Now the town of Coolgardie has a population of about 1,200, property is cheap and the desert has reclaimed the rest.

Today Australia is in the grip of a national land boom. In this huge country with a relatively small population, land is going up rapidly in price. Developments are under way in places thousands of miles apart, and land fever has spread through every section of the community. But gold does not account for it this time. Land is being bought for the income it will bring or the price it will sell for in a few years time. In Australia there is a lot of land. History shows that booms burst, even land booms. Unless the income from land is channelled into the public purse, rather than into the pockets of the speculators, the conditions for the crash will inevitably be generated. Not just a few towns like Coolgardie will be affected, but the whole country will suffer.

Is it too late to learn from the lessons of the past?