In 1932 Australia came close to civil war as NSW and the Federal Government fought over defaulted loans and tax rolls. The tensions between Jack Lang and Joe Lyons escalated until Sydney was rife with militia for both sides and the Lighthorse had been moved outside of Canberra to halt any invasion of the ACT from NSW. In the end Phillip Game, the Governor of NSW, dissolved Lang's government. (more)

In the fiscal borrowing crisis that Australia faced in the Great Depression, Joseph Lyons, then assistant treasurer of the Labor Scullin Government, saw it a failing of national character if Australia didn't adhere to "Sound and Honest Finance" and only borrow what it could repay. This directed his actions in saving the Federal Government from defaulting on its fiscal bond obligations. The principle of "Sound and Honest Finance" worked well as a popular political policy. It was easily understood by the electorate, who other than large borrowings for a house, understood the money in - money out principle from everyday experience. Advocates of Free Markets and Free Trade don't have such an easy time, the principles are often abstract, and don't fall as easily into the day to day experience of most of the electorate. (more)