March 28, 1901

LIB

William Ross

Liberal

Mr. ROSS (Victoria).

We have a leader from our province on this side of the House.

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CON

Andrew Broder

Conservative (1867-1942)

Mr. BRODER.

I only wish to say that consistency is a jewel which you will never find over there, and we need not look for it. Men who have talked free trade for twenty years are there now, declaring themselves to be tariff revenue men or free traders in principle, who cannot apply free trade to this country. If there is anything at all in the free trade argument, the sooner you apply it to a young country, the easier it is to apply it. Hon. gentlemen opposite are not honest when they make that statement, because they try to shelter themselves for not applying their policy to the country behind the statement that this is a new country and it cannot be applied. if they cannot apply their policy to the country, the honest, straightforward course is for them to go out of office and give others a chance to apply another policy. There is no danger of that, however, in this case. If the country is too young for a free trade policy, I suppose it is because the patient is not strong enough to stand the medicine. The fact is, that hon. gentlemen opposite are afraid of public opinion. They never announced to the country their British preference as a part of their policy. The Minister of Marine and Fisheries (Sir Louis Davies) put a small motion of about three lines on this subject on ' Hansard' some years ago, but it was never discussed on the public platform. They never attempted to put forward that Mr. BRODER.

policy until they got here among their friends who had been fighting for free trade for many years, and who said to them : You must do something in the direction of free trade ; and then the ingenious brain of the Finance Minister conjured up a preference to England, and they threw it to their followers as you might throw a plank to a drowning man ; and on that plank they got ashore. Is that what you talked about to this country for eighteen years ? In all that time it never was mentioned, and hon. gentlemen have not been honest in adopting it. They adopted it merely as an emergency food for their friends ; but it is very weak, and they will not live on it long, and they know it.

Now, the hon. member for Vancouver (Mr. Smith) made some reference to the condition of labour in the United States. Does it not occur to that hon. gentleman and to the House that his argument was not pertinent at all ? Because you find in Europe that the manufactured products of the United States, such as iron, are disturbing the economic conditions of all Europe. Yet, this hon. gentleman talks about protection being *a failure to the labourer in the United States. Where are the labourers who are shut out of our mills going to-day ? They are going to the United States, a highly protected country. Hon. gentlemen could not use an argument more detrimental to their own interest than a comparison of the United States with any free trade country. American iron is displacing English iron in the world's market, and even our own Minister of Railways has to go to the United States to buy engines and cars. When we look over the history of the United States we find that their difficulty only came when they receded from a high tariff, and in every instance they have had to go back to a high tariff in order to keep their labour for their labouring men, and in order to keep pace with the great requirements of the country. There is no country in the world to compare with it, for the enormous success it has had as a commercial country, in the few years, nationally speaking, of its existence. Another thing I wish to refer to is the great increase in the value of the agricultural products of that country under high protection. The increase in the value of agricultural products last year over that of the previous year was no less than four billions of dollars. Yet hon. gentlemen talk about the condition of things in this country. When they make these comparisons, they must expect to be met with the facts.

These are things which every public man should understand before he atempts to legislate for the requirements of this young country. With its enormous resources and the great energy of its people, all it wants is proper management and the proper investing of capital to attain the position it ought to attain as a prosperous and. growing country.

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LIB

Joseph Henri Napoléon Bourassa

Liberal

Mr. HENRI BOURASSA (Labelle).

trying to find some fine names to make ourselves seem in accord witli declarations made twenty-five years ago. The Canadian people is broadminded ; it does not ask its public men to show that their action to-day is copied from a dictum a quarter of a century old, so long as their action is a right one, and one in the interests of the country. I believe that, as a general rule, the taxation of this country should be proportioned to the requirements of the government, meaning that there should be a high rate when the total revenue is not up to the required expenditure, and a lower rate when the total revenue is too high. This is a general principle, which, I admit, must be applied with some care. It does apply indeed, and has been applied for several years in France. Now, I am free to admit that I am not a great admirer of the French system of government, so far as politics are concerned. I have never made any bones about it. i think it will be admitted that I am not moved by a desire to flatter anybody-I am not a flatterer, I think I may be granted that much- if I say I am a great admirer of the British system of government, so far as politics are concerned, so far as the balance of power Is concerned, so far as concerns the granting of individual liberty and the keeping up of social liberty. But, so far as economic policy is concerned, I may be granted leave to say that the French nation is the best-ruled nation in the world. It may be said that under the French system of economy the trade of France has not expanded, while the trade of England, the trade of Germany, the trade of the United States have expanded. To my mind, the end of government is not so much to help the manufacturers and tradesmen of a country to make and sell more goods, but to see that, through a sound economical policy, each class of the people shall share in the benefits of industry. The richest country in the world, to my mind, is not the country which manufactures and sells the most, but in which there is an equal proportion of wealth amongst all classes of people. And, so far as that is concerned, there is no nation that equals the French nation to-day. And why ? Because their economical questions are outside of politics. There are free traders and there are protectionists in France ; but there is no party of free trade and no party of protection. There is a non-political commission which, every year, looks into the production of the country, considers the industrial condition of the country ; and, if it is found that the prices charged by the producers of goods are too high, the duties are lowered and foreign goods are allowed to come in to compete-not to crush the national industries-but to force the producers to sell their products to the people of France at a fair profit. Now, I admit that in Canada, it would be harder to apply that system, be-Mr. BOURASSA.

cause this is a new country ; new industries are developing, new natural resources are found which change every year the conditions of industry. But, 1 say that we should move towards this end. A tariff should not be prepared and maintained forever simply to protect this industry or that industry, simply to flatter the farming community on one hand or to favour the manufacturing community on the other hand. The tariff should be framed free from political aim, so that all classes of the people should get a legitimate profit by it, and no class should be allowed to make profit at the expense of another. I say that we need some kind of protection in this country. Even in 1890, before I knew exactly what would be the tariff framed, should my party get into power, I told the electors of the county in which I ran, that I was a protectionist, my reason being, I believe, that of the hon. member for Vancouver. The hon. gentleman did not get to the point of telling us why, having come to Canada, he had changed his mind or rather found that a policy which he admired in England could not be applied in Canada. To my mind, the reason is a simple one. As I said, I believe in the tariff being framed, not upon theory, but upon actual and real facts with which we have to deal. What is our position ? Here, on the northern part of the North American continent, are two nations. One is a nation of seventy-five millions of people, separated commercially from the rest of the world by the highest protective wall that exists on the globe. The other is a young rising nation of six millions of people. My reason for saying that we need that, and for some years yet to come, and, perhaps, for many years to come, we shall need a protective tariff in this country, is not merely to give revenue to the government, l*ut to protect ourselves against undue competition from the Americans. I would have no objection to the American goods coming into this country and competing on a fair basis with the Canadian goods; but I have, and I shall continue to have, objections to the American manufacturers, having made up their enormous profits in a protected market of seventy-five millions of people, coming and competing with the Canadian industries and slaughtering prices in Canada. I may be told by my free trade friends : But the Canadian consumer will get the benefit of it, for he will buy cheaper ; and why should you tax all the people of this country for the benefit of a few manufacturers ? I find my reply in the very words of the hon. member for Vancouver this afternoon. As he told us, the manufacturer is the most tyrannical monopolist in the world. It may be that the Canadian consumer, for a short time after the barrier was lowered or removed, would benefit by the low prices of American goods coming into this country, slaughtering our markets and destroying our

manufactures. Tlie consumer might get American goods for two or three years at cheaper rates and so make money. But once the Canadian manufactories were closed and competition in Canada was no longer possible, the prices would go up, as we have seen the price of coal oil go up. And, as against the profit we should make for two or three years, the consumer would pay tenfold in the following years when the Canadian manufacturer was crushed and the American manufacturer had control of the market. I would be a free trader as much as any man on this side of the House, if there could be fair competition from other nations with the American manufacturer. If the conditions were such that the German or English product could come in and compete with the American product, I would say : Let the Canadian manufacturers be driven out, and let the Canadian consumer profit by the cheaper market. But what do we see now : the steel king of the United States sells his goods, not merely in British possessions, not merely in the competitive markets of the world, but in England, at the very door of the English manufacturer, competing in an industry which has been for years in the hands of England. He forces the English railways to buy American steel rails manufactured in a protective country, after they have been transported to the seaboard on American railways, carried across the Atlantic, taken to the very door of the English steel manufacturer and sold at cheaper prices than the Englishman can make them.

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LIB

William Cameron Edwards

Liberal

Mr. EDWARDS.

Will the hon. gentleman (Mr. Bourassa) allow me to ask him a question ? Does he pretend that it is as a result of protection that these steel rails were manufactured more cheaply in the United States and sold in the British markets ?

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IND
LIB

William Cameron Edwards

Liberal

Mr. EDWARDS.

Then, the hon. gentleman does not know what he is talking about.

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LIB

Joseph Henri Napoléon Bourassa

Liberal

Mr. BOURASSA.

Before my hon. friend from Russell (Mr. Edwards) passes judgment on my knowledge, let me answer his question by saying : No, I do not pretend so. But, I take the facts as they are. Whether it be on account of protection or on account of more skilful labour, or better means of production, I find that the manufactures of free trade England are driven, not merely out of the markets of the world, but out of the British market as well, by the products of the United States. Therefore, I say, before we open our doors, let us consider these facts. I do not say, however, let us nail up our doors. And it is for that reason that I cannot adopt the first paragraph of the declaration of the leader of the opposition, which says :

72J

That, in the opinion of this House, the welfare of this country requires a pronounced policy of adequate protection and encouragement at all times to the labour, agricultural, manufacturing, mining and other industrial interests of Canada. .

I simply say that so long as we cannot find better means of preventing American manufacturers slaughtering their goods in foreign markets, after they have made an honest profit in their own so long as we cannot otherwise prevent their killing our own industries in this way-we need some protection for some time to come. But when we come down to the details, then we should find out the difference between . protectionists on principle and protectionists by accident. The difference should be this : Instead of abiding by the straight rule laid down by the leader of the opposition, men who have fought all their lives for the doctrine of free trade, should carry their principles into practice by at least giving the lowest protection possible and concentrating that protection upon those industries which make the most use of the natural products of this country. That protection should also be administered in favour of those industries which are liable to be killed by the competition of foreign monopolists, and should be applied more particularly to Canadian manufactures that are not under the control of monopolies and trusts. In other words, we should fight, not only against foreign but against domestic trusts as well. Of course, I know that in the tariff of 1897 there is a special provision giving power to the Minister of Customs to discriminate against trusts and combines. But how is that law applied ? I shall not go into the details of the tariff, not only because I do not pretend to be an authority, but also because I do not believe that a great accumulation of figures implies a great deal of science. But I shall simply take the three industries of sugar, cotton and wool. These three, I would, in my ignorance, classify under the heading of artificial industries, and what I mean by an artificial industry is one which does not use any national product, but imports the foreign product and then converts that product into something else. The three industries I have mentioned, I refer to more particularly because their products are those most required by the mass of the people, especially sugar and cotton. Woollens perhaps are not so totally required by the poor, because they include the more expensive articles of clothing.

What about sugar ? We are told by the Minister of Finance that he does not propose to encourage the manufacture of beetroot sugar. I am not a believer in bounties on principle, but if under a free trade government bounties are to be given to capitalists, to owners of iron mines and iron smelters, why should not a similar favour be extended to the Canadian farmer, especially

when that would encourage competition against one of the largest and best known trusts of this country. If there is an artificial industry in the world, as far as Canada is concerned, it is that of sugar. We do not produce one cent's worth of the raw material required by the refiners, but thanks to our tariff-not only the tariff framed four years ago, but the present tariff- the sugar refiner has ample protection. According to the statement of the Minister of Customs the other night, our revised tariff of to-day gives S cents more per 100 pounds of protection to the refiner, which means the swelling of the dividends of the sugar trust and an increase of revenue to the government at the cost of the Canadian consumer. Yet, when the Canadian farmer asks a little bounty, he is told in reply : Oh ! no, this is a free trade government.

Let us take cotton and wool. Here are two industries which are most directly affected by the preference accorded to Great Britain. We had the hon. member for Vancouver (Mr. Smith) telling us this afternoon that the woollen industry had not suffered from English competition. But on the other hand, we had the declaration of the hon. member for Peterborough (Mr. ICendry) telling us that it had. In this matter, I do not profess to be a judge, but I know that last week I met one of the representatives of the biggest woollen concerns of Canada, and was told by him of the efforts which the woollen manufacturers had made to meet English competition. He said that when the 25 per cent reduction was made in the tariff of 1897, they got new implements and improved machinery, and were prepared to fight the English competition. And even when the further reduction of 8J per cent was made, they did not cease their efforts ; but they were very much afraid that when the trade, which was now very brisk, became slack, they would not be able to stand the pressure. They were afraid that at first the smaller manufacturers would have to shut down and then the others would have to follow suit. I voted heartily in favour of the reduction of 25 per cent in the tariff of 1897, not for the reason, given three years later, that it was going to create a stronger bond of unity between England and the colony, but because it meant a reduction of duty to the Canadian consumer. For the same reason, I supported the further reduction last year, but at that time I made a reservation. I said : I am in favour of this reduction because I believe that industries, which cannot hold their own with two-thirds of the actual duty in their favour and the cost of transportation, are not worthy of existing on Canadian soil, and the Canadian people should not be taxed for their maintenance.

I expected that this year the question would be looked at with a little more care by the government. I would be disposed to say that these industries which cannot exist under

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LIB

Joseph Henri Napoléon Bourassa

Liberal

Mr. BOURASSA.

the present preferential tariff of England, should not exist. But then let the law be the same for all. How is it that previous to the reduction that was made in favour of British goods, the duties on woollen articles remained the same but the duties on cotton fabrics went up ? We had a letter from the most important cotton manufacturer of this country, Mr. Gault, congratulating this government on the way they had framed their tariff. The Minister of Customs says to the woollen manufacturers : Go on, display

skill, and the Almighty will help you ! But when the cotton industries were concerned, perhaps the government said the same thing : Display skill, help yourselves and

the Almighty will help you,-and perhaps they added : We will help you a little too,

and we will raise the duty. Why this different treatment V Is it because the woollen industries are not combined and the cotton industries are combined ? I would be very much surprised, though not being a free trader on principle, if, under a government elected to power by free traders, combined industries should receive special protection, while industries who are striving to live separately receive no consideration.

Now, Mr. Speaker, I come to the second paragraph of the amendment of the leader of the opposition, the paragraph in favour of mutual preference throughout the British Empire. To my mind that paragraph is a direct contradiction to the first one. Hon. gentlemen opposite have complained that Canadian industries are hurt by the preferential tariff, and they say they want a preference in the British market as a compensation for the preference we give. I have followed pretty closely the declarations of hon. gentlemen opposite, from the leader of the opposition to the last speaker, and I have not yet been able to catch their idea. I would like to put this question to the leader of the opposition : Are we to understand by this paragraph in favour of mutual reciprocity between Great Britain and her colonies that, if the leader of the opposition should come to power, he would protect the industries which his party claim are hurt by preferential trade, by raising the duties on foreign articles to the rate that existed before, in order to make up for that preference in favour of British goods ?

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CON

Robert Laird Borden (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BORDEN (Halifax).

I do not see that there is any difficulty at all in what the hon. gentleman suggests. It is perfectly easy adequately to protect Canadian industries, and at the same time, so far as we have to import from foreign countries, to give a preference to Great Britain.

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LIB

Joseph Henri Napoléon Bourassa

Liberal

Mr. BOURASSA.

I think the reply is very indefinite. These gentlemen are attacking the preferential policy of the government on the ground that it hurts some Canadian industries. I do not think they would go so far as to say that, should they [DOT]come to power, they would first raise the

duty on those article by 33J per cent of the old duty, and then raise the duty on all other articles except British so as to make up for the preference. Therefore, should they leave things as they are, and simply ask for compensation by a protection on colonial goods in the British market, that would not afford any help to the woollen industry. The fact that we would sell more cheese, more flour, more butter, and that we might sell them at a higher price in the British market, would not be any compensation to the woollen manufacturers. Therefore, I say that from the point of view laid down in the first paragraph of the amendment that there should be ample protection to certain industries, the kind of preference which they suggest would not be in accordance with their promises to those industries.

Now the question is, what advantage would be derived from mutual protection ? To my mind-and that is especially where I differ from the government-X do not oppose this motion simply on the ground that mutual, protection cannot be obtained from England, I oppose it on principle. But the Prime Minister and the Minister of Finance say that we cannot get that preference, while the hon. gentlemen opposite say we can. The evidence given by hon. gentlemen on this side that we cannot get the mutual preference, is especially drawn from the deliberations of the congress of the Chambers of Commerce in London last summer. I am one of the first men in this country who read that report. It was sent to me directly from London by an English friend of mine, who is like myself an anti-imperialist, only that he is free to say in England what I am not free to say here. The Prime Minister, the Minister of Finance and the Minister of Customs have referred to that report, but only to that part of it which relates to commercial preference. But the question was not presented to the congress of the Chambers of Commerce in London, it was not presented to the British people, it was not presented to the Prime Minister of England, it was not presented to Mr. Joseph Chamberlain, upon the ground that it was simply a matter of trade; therefore I may be allowed to complete the record made by the Prime Minister and his colleagues. The document is a very interesting one, and is illustrative of the present state of mind throughout the empire-of the juvenile colonial enthusiasm in comparison with that stern common sense and sound British spirit of which we have had such a good example in the hon. member for Vancouver (Mr. Smith). And I may say to that hon. gentleman that I would be pleased one of these days if he would come down to the province of Quebec, and I would help to elect him in one of our French constituencies ; we need Englishmen like him in this country. The first question that was presented to that

congress was not the question of mutual preference, it was the question of a consultative Imperial council. Gentlemen who are familar with this congress know that all tlie resolutions discussed in it are framed previously iu all the Chambers of Commerce throughout the empire, and then sent to the Secretary of the Association in London, and therefore are printed long before they are discussed. A motion in favour of an Imperial council was proposed by a delegate from Birmingham, Mr. Tonks, and in order to give the House the spirit of his motion I will just read a word or two from his speech :

It might be better in this matter of the Imperial council to begin with consultation with the idea that we might end with federation.

Later on :

I believe one of the most important questions which we have to consider at this congress is this question. But if we are willing to take the first step, I feel sure, from what I know of the feelings and views of the Secretary of State for the Colonies that he is only anxious to take such a step if the colonies themselves are united in desiring it.

Well, the colonial representatives were so united that they were not satisfied with the suggestion of the representative from Birmingham: he was not expecting enough from the colonies, he was not opening wide enough the doors of the Council Chamber in favour of the colonies. The representative of the Ottawa Chamber, a civil servant of this government, Mr. Macfarlane, came there and seconded an amendment which was moved by the representative of the Cape Town Chamber, to the effect that not only did the colonies want to be represented, but they wanted to be taxed. The Englishmen said : No, you go too far, we do

not want your money. But the colonials, full of pride and enthusiasm, insisted: We want to pay, we want to tax ourselves ! And Mr. Macfarlane, a civil servant of this government, was offering the money of the Canadian people to the Englishmen who did not want to take it. Sir, I will read the amendment that was proposed by the Cape Town delegate :

The time has arrived when a serious effort should be made to formulate a scheme of Imperial federation, whereby the self-governing colonies shall be represented in the councils of the empire; that as a means to this end, all the self-governing colonies should contribute a percentage (to be decided by the representatives in conference)

Not even by their parliaments. Oh, no ; parliaments are a small thing under the new system.

That representation in any federal council should be in proportion to the respective contributions of the several states ;

That copies of this resolution be forwarded to Lord Salisbury and the premiers of the selfgoverning colonies for their consideration.

References were made 'to the war in South Africa, and to the display of devotion by

tlie colonies, and, therefore, it was said, that we should not stop these devoted colonies from paying a little more. The representative from Ottawa arraigned Lord Salisbury, who, to his mind, was not Tory enough. He said that the policy for England should be Lord Beaconsfield's policy, and he quoted some words from Lord Bea-consfield, regretting that autonomy had been given to the colonies without some restriction, so that the colonies could bo ruled from London. Some very distinguished Englishmen protested. Lord Avebury, delegate from the association of Chambers of Commerce of the United Kingdom, said : Do not go too fast; we may come to that but wait a little. Here are his words :

In voting for the original resolution, we desire it to be understood that we so vote because we believe that the resolution of the Birmingham chamber will carry us as far as we are prepared to go. Many of us, in supporting what is proposed by the Birmingham chamber today, believe that the time is not far distant when we shall see carried what is suggested by the Cape Town chamber.

Again, the colonies protested. Senator Drummond, one of the representatives of Canada, arraigned the mild language of the Birmingham resolution on the ground that the Englishmen did not want us to be English enough. He said :

I maintain that the language of this resolution of the Birmingham. Chamber of Commerce is entirely insufficient and disappointing. I can assure this assembly that the people of Canada who sent their sons to South Africa were not influenced by any such milk-and-water sentiment as * increased cordiality and sense of union' -increased cordiality-to the extent of inviting you to an afternoon tea, or something of that sort, and to any social function.

Finally, a compromise resolution was arrived at in order to make up for the sentiment of the English people who did not want to take too much from us, and for the sentiment of the colonials who wanted to make us pay more. It was found that in the wording of the compromise resolution, the consultive chamber was to arrange for all this, and thereupon a common-sensed Englishman said : You are making a legislature of this council ; it should be made to consider and advise and not to legislate. Again, a Canadian delegate said : No, no ; we want it to legislate for and govern and rule Canada. But, finally, the common sense of the English people prevailed, and the resolution which was carried was some kind of a resolution which leaves us yet the right to say that we can select to be taxed or not by Mr. Macfarlane, just as we please.

Then, the question of commercial relations came up. As has been said in this House, the matter was introduced by the hon. member for Toronto (Mr. Kemp), who gave a great display of colonial sentiment. Mr. Macfarlane came to the rescue, stating that we had sent our sons to Africa, and, Mr. BOURASSA.

therefore, we wanted to be united and blended with England, and so on. In fact, the only colonist to talk

This congress, rejoicing in the growing evidences of unity between the mother country and the colonies, and recognizing the material and political advantages of the largest possible exchange of commodities between the various portions of the empire, is of opinion that all measures for the promotion of this end should respect the liberty of each portion to purchase in the cheapest market wherever it may exist.

Again the colonials protested. Dr. Parkin spoke of the display of Imperial sentiment in Toronto, Montreal and elsewhere. Mr. Scott protested, that even if we would not be granted any favour by England we were still willing to give our money and our blood for England. That did not disturb the British common sense, and Mr. Thompson replied, speaking of the colonies :

Their trade is of great value to us, but we esteem their friendship even more highly than their trade. The events of the past year have brought home to every Englishman the immense moral and material support which our colonial kinsmen can and do render to the mother country in the defence of the empire. This is far better than any mere community of interests, it is emphatically a union of hearts.

The delegate from the Edinburg chamber, Mr. Anderson, was still shorter and clearer, for he simply said :

Sentiment is one thing and business is another.

Well, the result was that the colonies, in spite of all their display of sentiment, had to come back to accept a compromise resolution, which meant simply that a delegation would interview the Prime Minister of England and ask his opinion, in order to know if some possible favour could be granted to the colonies. We know what was the result of that. The Minister of Customs (Hon. Mr. Paterson) has told us the result of that with much wit and eloquence. The Prime Minister of England, who had been so glad to accept our soldiers, who had been so glad to have our blood shed, who had been so glad to have our moral support in Africa, did not want to receive the Canadian delegates, because it might hurt him in his elections. And though Dr. Parkin, when that compromise motion was adopted, received it as a ' nunc dimittis,' and said it was the opening of a new era for the empire, yet, the Prime Minister of England, and Mr. Chamberlain, reduced it to nothing in a few days.

There was a third question brought up, and it is a question which was coupled in-

timately with tlie question of the Imperial council and the preference in the British market. It was the question of Imperial defence. Again, of course, it was moved by a colonial. The man who moved it was Mr. Hadrill, of the Montreal Chamber of Commerce, and Mr. Macfarlane, who must have much time to prepare his speeches when he is not analysing for the Dominion government, said the motion did not go far enough for him. He wanted Canada to be taxed 5 per cent on all its imports in favour of the British army and navy. This year that would have meant $6,000,000. It is a fine thing for a Dominion civil servant to go to London and to say in our name, without consulting the government of this country, without consulting the (Prime Minister of this country : That Canada is ready to tax herself $6,000,000 a year as a contribution to the English army and navy. But, Sir, what is most peculiar of all is this : Among the three hundred delegates present, one delegate, Mr. Geoft'rion, of the Montreal Chamber of Commerce, had probably read the eloquent words of the Prime Minister last session on the question of the South African war, when the right hon. gentleman said : That Canada was keeping her liberty; that Canada would judge of each case according to its merits, and would interfere in British wars only when she thought fit to do so. Imbued undoubtedly with the eloquence of the Prime Minister, Mr. Geo-frion stated that the contribution of Canada towards the South African war, in sending 3,000 men, and in expending several million dollars without being obliged to do so, should be a proof of the devotion of the colony, and, therefore, he moved as an amendment:

That the colonies be not asked to contribute to the defence of the empire unless they do so willingly, and without coercion or written law.

We have heai-d, Mr. Speaker, of the great influence of the words of the Prime Min-inster of Canada in Great Britain and throughout the empire. Here Mr. Geoffrion uses words taken almost literally from the right hon. gentleman's speeches, but they did not find one seconder in that assembly. Mr. Geoffrion could not find one man to second his motion, and he had to sit down, and the motion which prevailed was not the one inspired by the Prime Minister of this country, but it was the one supported by a Dominion civil servant, and proposed by the Montreal delegate of the chamber of commerce. To sum up, the result of that congress in London, which is far more important than some imagine, is this : When it was a question of giving some representation to the colonies in the Imperial council, there was a division of opinion pro and con ; when it was a question of getting some favour of the colonies from the mother land, it was set aside ; but, when it was a question of taxing the colonies entirely and

solely for the benefit of England, it was carried unanimously ; not a word of protest from the English delegates-not even a word of thanks.

Mr. Speaker, I do not utter these words as a reproach to the distinguished representatives of English trade and politics who were there. No, Sir, they were up to their duty. British statesmen and British tradesmen understand that their first duty belongs to the British nation : and therefore when the colonies go there and offer favours which they are not asked for and not obliged to give, British statesmen and British tradesmen would be very foolish not to accept them. But, I am sufficient an admirer of Great Britain to say that we should be the worthy sons of that great nation and look first after our own interests ; because if we wait for her to look after our interests, we may be left in the dark. The whole problem of political, military and economic Imperialism was summed up by no less an authority than Lord Selborne, Under Secretary of State for the Colonies, in his opening address at that congress, when he said ;

A century and a quarter ago it was this question of Imperial defence which lay at the root of that quarrel with our American colonies which finally lost them to us. To-day it is the same question operating more than any other to draw the different parts of the empire together.

I cannot but echo the words of Lord Selborne. The question of to-day is no new one. It is not the development of a new Imperial policy. It is the same old question which took from England the finest part of her empire. It is the question whether the colonies are to be ruled from London or at home. Sir, the present system is finer, I admit ; it is better framed ; sentiment is better developed in the colonies. Good governors and good majors-general are sent to the colonies ; there is a press which was not in existence 120 years ago ; and the press of this country is influenced to work up sentiment. The eyes of the colonies are veiled by sentiments of loyalty which are not at stake, and politicians are scared. We are proud to compromise the liberty of the colonies and tlieir autonomy under the new name. The representative of the Ottawa Board of Trade, at the London Congress of the Chambers of Commerce, eulogized the policy of Lord Beacons-field, and I do not think we shall have to wait very long before we shall have some apologists telling us that the best rule that existed for the colonies was that of Lord North and George III. We are coming to it very fast.

It may be answered that the parliaments of the colonies are free, that they can object to anything sought to be imposed upon them by the British government. Yes, but do not forget that the Irish parliament was free not to sell the liberties of Ireland, and

they were sold just the same. I admit that the operation was very quickly done ; but I do not think that it was more surely done than it is being done uow iu Canada. You may say that there is a good deal of politics in all these things. Yes, there has been a good deal of politics in the way the question of Imperialism has been treated in this country. No doubt it was politics when one party iu Ontario was telling the people that love to the mother country was the only inspiration of its policy, and in Quebec was saying that they had only done it for the sake of Canada ; and when the other party was saying in Ontario that their opponents had not done enough for England, and was saying in Quebec that they had done too much. But the men who were gathered together at the conference of the Chambers of Commerce in London, were not politicians, but representatives of British Capital and industry. Not only was the trade and commerce of the whole empire represented there, but also the bankers, the large navigation companies and the railway companies ; and the influence of British capital is very strong in all these institutions. When a Canadian or Australian or Cape Colony company has debentures to float or money to borrow, where do they go ? They go to London. You may say they go to London for business and not for politics. I may be allowed to mention a little incident to show how the London capitalist can influence politics in other countries. It may scandalize very much the loyalists of this House to hear it, but in England it would not do harm to any man ; so I will speak as if I were in England. I met last year in New York the chief secretary of the pro-Boer committee, who told me that he had gathered funds, not to help the BoerS, but to send help for their wounded and sick soldiers, just as another committee in New York had been organized to send help to wounded and sick British soldiers ; and he said he had tried to place his funds in fourteen American banks, and he was refused permission to do so. because he was told that it would hurt their business in London. When we see that the influence of English capitalists is strong enough to prevent a banker in New York accepting money which was to be devoted, not to military purposes, but to charity, we may be sure that the English capitalists can influence capital in Montreal, Halifax, Toronto, and elsewhere in Canada, and can also influence Canadian politicians. I do not mean to influence them corruptly, but I mean to influence public opinion. How was this influence of the Chambers of Commerce carried to the politics of the colonies ? In a very simple way: through the British Empire'League, a branch of which exists in Canada, and to which belong ministers of the Crown, members of both sides of the House.

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LIB

Joseph Henri Napoléon Bourassa

Liberal

Mr. BOURASSA.

and senators-Conservative and Liberals, French and English. Two or three members of this cabinet were there ; and what did you see ? At the meeting of that league held in Ottawa, during this very session, the same resolutions, were passed which had been adopted by the Chambers of Commerce, and it was very skilfully done. These resolutions are always moved by a Conservative and seconded by a Liberal, or moved by a Liberal and seconded by a Conservative. The president of that league read an address, which has been scattered all over the country in pamphlet form, and in which the very idea dominant at the congress of the Chambers of Commerce in London was set forth, namely, that all the colonists should be taxed to contribute to Imperial defence, meaning, in the very words of the president, a contribution of over six millions of dollars from Canada, for this year alone.

Now, with regard to getting an Imperial preference for Canada, I do not see that it is a very remote possibility. It is true, Mr. Chamberlain has said that it will not come. But Mr. Chamberlain is not there for ever, and he has changed his mind on a few subjects, from home rule down. We know that Mr. Chamberlain is not only the master, but the prophet of this government. and of this country; but, Sir, there is something more powerful than even Mr. Chamberlain ; there is British capital, and there are British interests. British trade is suffering to-day. The British manufacturers are finding that their products are coming more and more into competition with foreign products in foreign markets, and foreign products are coming into competition with their products even in their own market. At the same time they see that the trade of their colonies is increasing and that their purchasing as well as their producing capacity is growing every day ; and they may come to the conclusion before long that something might be done with the colonies to the exclusion of the rest of the world. Of course, the British capitalists will not act as long as they can pay us with declarations and sentiments. John Bull is a practical fellow, and he will pay us with compliments and medals as long as we accept them, like the savages who exchange gold and ivory for glass pearls. But the time will come when the colonies will not accept such things as sufln-cient compensation for their blood and money, and what will then be offered ? Then we shall be offered an Imperial council, first to consult, and afterwards to federate and deal. I need not say that such an Imperial council does not mean representation for the colonies. I do not mean to say that there may not be two or three men in it from Canada, and two or three men from Australia, New Zealand and other British colonies : but that does not

mean representation for tlie colonies. Of course, 1 may presume that these men will always be the best we can send ; but after all they will always be, as far as each colony is concerned, a small minority in the whole council ; and moreover, they will always be under the direct influence of the London government. I say the Canadian people can have proper representation only in a chamber which is on Canadian soil, and over which they have exclusive and direct influence. You may say that this is not becoming, but our Canadian representative, Lord Strathcona, has already approved the idea. Addressing a Scotch audience some months ago, at some festival in the Aberdeen University, he said he was in favour of the organization of an Imperial council, on which each colony would be represented by one, two or three men, and which would deal with Imperial affairs.

The next step would be commercial preference, and I would not be surprised if it should come. But when it does come, it will mean that the amount of taxation which the British people will impose on themselves in order to give a preference to colonial products, would be more than compensated to them by the sacrifices of money and men required of the colonies to keep up the Imperial army and navy. There is some talk of reorganizing the army in England and the word ' conscription' which, six months ago, could not have been uttered before an English audience, has been pronounced by a minister of the Crown in England. On this question of preference, on which we are told that Lord Salisbury and Mr. Chamberlain have made up their mind, it is true there is no public declaration ; but, according to all the reports, the English cabinet are divided, and while Sir Michael Hicks-Beach still stands by the old principle of free trade, Mr. Chamberlain is inclined to give some kind of preference to the colonies. But as far as I am concerned, I shall vote against the resolution of the leader of the opposition, not because I think we cannot get this preference or because it may not come for a long time, but because I do not want it. And I do not want it for the reason that it would coist us a great deal of our liberty and commit us to Imperial federation. My position to-night is exactly the same as that taken by the right lion, the Prime Minister in 1891, when he said in Boston that Canada would never consent to Imperial federation because that would mean contribution to England's wars. The right hon. gentleman may have changed his ideas since, but I may be permitted to stand on the same ground as he did then, and refuse English preference because I believe that the price we would have to pay, namely, the obligation to contribute to England's wars, would be entirely too costly.

I now come to the third paragraph of the amendment, but evidently any reason for that third paragraph has disappeared since the hon. gentleman has told us that it does not apply to the United States. If the policy of discriminating in favour of or against foreign countries according to the advantages they give or refuse us, were to apply to any country, it would apply to the United States, and therefore if the hon. gentleman is not in favour of applying it to the United States there is no reason for its existence in the resolution at all. On this point I fully agree with the First Minister, when he says that our tariff should not be framed with regard to Germany or the United States but with regard to Canada. I believe with him that we should not impose a high duty, which would mean higher taxation on our own people, simply because a low duty might be of some advantage to American or German manufactures. On the contrary, we should frame our duties to meet the needs of Canadian consumers. The same remark applies to British goods. In this question we should treat all countries on the same principle. I have never preferred the American dollar to the British shilling, and I now worship the British shilling no more than I do the American dollar. The one principle upon which we should stand in our political, economical and military matters should be the devotion to Canadian interests in preference to American, British, German or any other. You may say that this is a policy of egotism. It may be, but egotism is the only law of nations. I do not say that we should disinterest ourselves completely from the welfare of other people, but our first duty is to Canada before every other country.

As regards our relations with the United States, I am a little embarrassed as to the treatment of that question. But my connection with the International Commission is now sufficiently distant to allow me to interpret the events that have succeeded, I may say this much, that if that International Commission did not come to any satisfactory conclusion, no blame can be east upon the representatives of Canada. They did their duty to Canada. They asked what they should have asked for. They showed sufficient spirit of conciliation and at the same time retained their dignity. But I will venture the opinion that if we did not succeed in getting better and fairer treatment from the Americans, the fault lies at the hands of the British government. That commission sat during six months-three in Quebec and three in Washington. After it was over, one of the British commissioners, who was at the same time a member of this cabinet, Sir Louis Davies, went to England and passed a few months there. And on his return he told us that he had found such prejudices in the minds of English states-I men that he had been obliged to write

a big volume In order to make them understand that Canada was right. Yet for six months the British government was represented on that commission by Lord Herschell, one of the ablest of English public men, and who was in correspondence with his government during all that time. Lord Herschell passed several weeks in Canada, and discussed the question with this government as well as with the American delegates, and was besides in correspondence all the time with the British authorities, and yet we had to send a delegate to London to persuade our dear cousins, the employees of Mr. Chamberlain, that they should look a little more to the interests of Canada and a 'little less to those of the United States. How is it that the British government succeeded in getting from the United States a settlement by arbitration of the Venezuela question ? Yet when we, under the same British flag, invoking the same law, ask the Washington authorities to apply the same principle of arbitration to the interpretation of the treaty between Great Britain and the United States, as successors of Russia's rights, they replied : No, the same principle no longer applies. In the war with Spain, the United States had the friendship of England and it has even been claimed that that friendship was the cause of the United States not having been disturbed by European interference. In the war between England and the Transvaal, the first nation to acknowledge the annexation by England of the Dutch republics was the United States. How is it, then, that, with all these friendly relations between the two countries, the Canadian case has received no attention ? How is it that the Washington authorities have been induced to agree with the British authorities on every question but the Canadian one ? I think it arises from the fact that as long as the British authorities are convinced that the* Canadians are simple-minded enough to give their money, blood, and assistance and to send over a representative to declare to the English people ' Even if you do not give us any return, we will still be always ready to help you,' they will take our money, blood and help, but when it comes to settling our difficulties with the United States they will only give us a faint-hearted support. So long as we do not make ourselves respected we shall not be respected.

Out of that great friendship between England and the United States, I had hoped for much. I had hoped that a country like Great Britain, which has done so much for the benefit of humanity, and the United States, which has done so much for the development of the world, would have agreed together upon a prompt and peaceful settlement of any dispute. But it seems that the spirit of grab is the basis of that friendship and cannot be fruitful of peaceable results. And perhaps the United States are Mr. BOURASSA.

not so much afraid of Great Britain as they were before this South African war. Of that we have had evidence by the way they have treated the Clayton-Bulwer treaty and the Hay-Pauncefote treaty.

Upon this question of the financial policy of the country, I wish to be clearly understood. Whether I may have a future or not in Canadian politics, I intend voting against the whole motion of the leader of the opposition, on account of its spirit. The principle enunciated in the first paragraph, I cannot accept. And I cannot accept it, not because I am a free trader, but because I am a moderate protectionist. The second paragraph also meets with my disapproval, not because we cannot get the preference asked for from England, but because we cannot get it without sacrificing a good deal of Canadian liberty and self-autonomy. And the third paragraph I am opposed to because, as matter of fact, we have no interest in applying the policy indicated to the United States or to other countries.

For many years, parties in this country have been divided on questions of political economy. The aim we should have, the end towards which we should move, is to secure the gradual control of our trade relations with all the countries of the world. I say that the adoption of the principle laid down by the leader of the opposition would have for its practical consequence the framing and control of our tariff policy by some kind of a board in London. It would be a check on our control of our own tariff not only with Great Britain but with the nations of the world. Therefore, Sir, as a Liberal, as a Canadian, attached to the interests of Canada, and wishing that the interests of the Canadian people should be looked after by the Canadian parliament, rather than those of any other country in the world, I shall vote against the three propositions of the leader of the opposition.

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CON

David Henderson

Conservative (1867-1942)

Mr. DAVID HENDERSON (Halton).

Mr. Speaker, it is not my intention at this late hour to offer any criticism of the speech which has been so ably delivered by the hon. member for Labelle (Mr. Bourassa). In fact, even if time permitted, I do not feel that I should be justified in offering any adverse criticism of the discussion he has given to the fiseal policy of the country, for the reason that there seems to be much in common between that hon. gentleman and those sitting on this side of the House. I shall, therefore, follow what I intended to say without reference to the remarks of the hon. gentleman, knowing that he will not regard it as in any way discourteous on my part if I do not offer that criticism which, perhaps, a speech of such ability would be entitled to.

We have been told again and again during this debate that we are living in prosperous times, in fact, that has been the burden of nearly all the speeches that have been delivered by hon. gentlemen sitting on

your right. And I may say that it has been well responded to by hon. gentlemen sitting on this side of the House. We are glad we do live in a time of very considerable prosperity. Hon. gentlemen to your right, however, I think, unfairly claim too much credit for the government now in power for the prosperous times that we now enjoy. They believe that all the large exports and imports of our country have been brought about by reason of the fact that a change of government took place in the year 1896. But, Sir, I see that even in far off China the gross trade of the country has doubled within the last ten years ; and I do not suppose, for one moment, that it will be claimed that the Prime Minister of this country had anything to do with the large increase in the trade of China. It is said that in the United States last year the gross trade was $319,000,000 more than that of any preceding year in the country's history. Surely it will not be contended that the government of this country had anything to do with the increase of the trade of the United States during the past year. We must look elsewhere for the reasons of the prosperity of this country. I think we shall be obliged to go a little further back in order to find who really is responsible for the wave of prosperity that is passing over the country, so far as it can be brought about by any governmental action. Thirty years ago, the government then in power, led by the late Et. Hon, Sir John A. Macdonald, acquired the great North-west country, about which so much has been said. I question if there is any one single act of the government of this country from confederation down to the present time that has tended more to add to our prosperity than that. The acquirement of the territories of the great North-west, that vast domain now dotted with cities, towns and villages, and filling up with prosperous farms sending forth its millions of bushels of grain year after year for export and bringing back millions upon millions of money Into the country, to swell the prosperity of Canada-there is something that a government did that has had the effect of adding to our prosperity. Then, Sir. wre had the construction of the Canadian Pacific Rail-;way, an act that was brought about by the Conservative party long before the advent of the Liberals to power. This great undertaking has undoubtedly done much to add to the prosperity of the country. It enabled the great North-west to be opened up, it enabled the products of that country, the grain and cattle of the plains, the products of the mines of British Columbia

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LIB

William Ross

Liberal

Hon. Mr. ROSS (Victoria, N.S.).

If the hon. gentleman will allow me, I would like to say one word. The first staff of surveyors sent out to survey that road was organized by Mackenzie when he was premier of the Dominion. And he continued the survey.

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CON

David Henderson

Conservative (1867-1942)

Mr. HENDERSON.

Yes. the first surveyors who went out to survey the water stretches on the line attempted to be built by the friends of the hon. gentleman (Hon. Mr. Ross), were sent out by Mackenzie. But I refer to the construction of the great transcontinental road, the road which has opened up that vast country and brought about the prosperity of Canada by making a highway for the products of the North-west to the sea, that they might be transported to the old country, a return being made in the gold which helps to make this country prosperous. Had we remained contented with the amphibious route of ancient days, which has been referred to by my hon. friend, there would not have been very much prosperity brought to Canada by it. Then, Sir, the Conservative government inaugurated the construction and deepening of the canals and in that way assisted transportation, facilitating thus the sending of our products to the foreign market and securing for us a better return, and thus again bringing prosperity to Canada. And then, what legislative act has ever done more to bring prosperity to the country than the great national policy inaugurated by our old chieftain, Sir John Macdonald-a policy that is not only revered by hon. gentlemen sitting on this side of the House, but is respected and admired by hon. gentlemen who sit to your right, Mr. Speaker. The hon. Minister of Customs (Hon. Mr. Paterson) sneered at the national policy because it was twenty-five years old. Twenty-five years old ! Why, it was a surprise to the hon. minister that we should stand by a policy for twenty-five years. How many policies have the Liberal party had in the last ten years ? Continental free trade, commercial union, unrestricted reciprocity, free trade as they have it in England, preferential tariff, tariff for revenue only-they are constantly changing. An average of about a year and two-thirds is as long as they can endure any one policy. How long has free trade been the policy of Great Britain ? Three score years or more. And do hon. gentlemen opposite say that the British people should change their policy because it is getting old ? Is it not a fact that in England there was a system of protection for two hundred years prior to the advent of free trade ?-a protection that made England what it is to-day, what it never would have been had they adopted a policy such as is approved by many hon. gentlemen opposite.

Speaking very briefly of the national policy and of the great advantages it has brought to this country, I propose to give one single instance. I will take, for the purpose of illustration, one industry that is being carried on at the present time, I refer to the hog industry. In 18S9, We had very low duties on hogs and hog products. It was found the farmers of this country could not secure or retain the home mar-

ket. Tlie government of the day came to their rescue by increasing tlie duty upon liogs, mess pork, fresb pork, bacon and bams, in sucb a way as to give tbe farmers confidence that if they entered heartily in tbe production of bogs they would at least bare tbe borne market for tbeir product. Well, Sir, in 1890, we imported from tbe United States nearly 30,000,000 pounds of bog product. In 1900, so effectually bad tbe system of protecting that industry been tbat we imported only 12,000,000 pounds of bogs and bog products. Thus, in ten years we secured for tbe farmers of this country a market of some 24,000,000 pounds of bogs and bog products-something, I am sure, tbat adds to tbe prosperity of tbe country, and something that must be attributed to tbe national policy. But, Sir, tbat was not all-tbat was only a small part of it. Not only did we secure tbe borne market; but, when tbe farmers of this country felt secure in tbeir position, they commenced to develop tbe industry, so tbat, while, in 1889, before the duties were increased, we only exported about 4,000,000 pounds of bams and bacon, last year we exported from this country the immense quantity of 135,000,000 of pounds of bams and bacon. Year by year from 1890 the export of bog products has increased. As I said, in 1889, it was but 4,000,000 pounds. In 1890 it bad reached 7,000,000 pounds. In 1892, it was 12,000,000 pounds-I omit tbe odd thousands of pounds. In 1894, 28,000,000 pounds ; in 1896, 53,000,000 pounds ; in 1898, 85,000,000 pounds ; in 1900, 135,000,000 pounds.

Year by year has this industry gone on, year by year stimulated by the protection given to it in 1890 under the national policy, this industry has gone on and has become a source of immense wealth to tbe people of this country, not only supplying an increased home market of 24,000,000 lbs., but an increased foreign market in bams and bacon alone of 131,000,000 lbs., bringing back into this country $12,000,000 in one year. There is tbe foundation of Canada's prosperity, and tbat alone can be credited to tbe national policy of tbe conservative party.

Now, the Liberals have claimed that this policy, this large increase tbat has been shown to have taken place since 1896, is chiefly due to tbe administration tbat we have in power at tbe present time. As I have already mentioned, the Liberals have bad various policies, they have had commercial union, they have bad unrestricted reciprocity, they have bad continental free trade, and tariff! for revenue only. They have been shouting all these policies during tbe last ten years. They remind me of the story of a man who went into the backwoods and hewed out a home for himself, and put up a little house. One day a bear came round, and tbe good man became frightened, just as the Liberals did in 1897. The man climbed on top of the bouse, and Mr. HENDERSON.

allowed bis wife to use tbe axe until she bad J killed tbe bear. Seeing tbe bear was dead, be came down, and after making a thorough examination, said : Yes, wife, we have

killed tbe bear. That is what the Liberals are saying. They were shouting all these different policies during tbe last ten years, and when prosperous times came they said : We have killed tbe bear-when as a matter of fact they did nothing more than come in and help consume tbe carcass.

Now, one word with reference to the expenditure of this country. When tbe Liberals were in opposition, if there was one thing they talked about more than another it was tbe necessity of reducing tbe expenditure. One of them promised tbat be would reduce it by $1,000,000, another one promised to reduce it by $2,000,000, another one by $3,000,000, another one by $4,000,000, another one by $5,000,000, and so on. We had immense promises of reduction of expenditure, but I fail to see tbat these pledges have been implemented by these gentlemen since they came into power. I think 1t well, even at tbe close of this debate, just to call attention to the fact that these promises have not been implemented. When they came into power the expenditure on consolidated fund account was $36,949,000 ; in 1900 it has reached tbe enormous sum of $42,975,000, showing an increase of $6,026,000. In 1896 we find tbe expenditure on capital account was $3,781,311 ; in 1900 it had reached $7,408,843, an increase of $3,087,532. I ask, where is tbe evidence of the promises made by tbe Liberal party when in opposition, having been carried out that tbe expenditure of tbe country has been reduced ? Tbe total expenditure in 1896 was $44,096,000 ; in 1900 it was $52,717,000, or an increase of $8,621,000 in tbe short space of four years. Tbe same can be said with reference to net public debt. From 1896 to 1900 the increase has been $6,996,374. Now, is this what tbe Liberal party throughout tbe country expected ? Is this what bon. gentlemen were sent here to approve of by tbeir votes ? Is this what they were told to vote for to-night ?

Mr. Speaker, it seems to me tbat the finances of this country are not thoroughly uliderstool by the people, and I think tlie time has arrived when some change in the system of our book-keeping ought to be adopted by which the idea tbat we have a surplus of $8,000,000 will be entirely dissipated. I dare say there are many people who actually believe that the government last year met all tbe wants of the country and bad a surplus of $8,000,000. Now let us see bow the account stood. We find that there was expended on consolidated revenue account, as follows : Charges of

debt. $10,873,673 ; subsidies to provinces, $4,250,608 ; sinking fund,-about which I shall have more to say-$2,465,640 ; collection of revenue, $11,044,526 ; other expenditure, $14,340,832, making a total expenditure

on consolidated fund account of $42,975,279. Besides tliis there was an expenditure on capital account of $7,468,84a, railway subsidies, $725,720, other charges amounting to $1,547,624 ; or a total expendi-[DOT] ture of $52,717,406. Now, how much money did we realize last year for the purpose of meeting this expenditure ? We are told there was a surplus of $8,000,000. If there was that surplus, the general public would understand that we must have had a revenue of $8,000,000 in excess of that, bui that is not the fact. Our total consolidated fund receipts only amounted to $51,029,994, with other small receipts, making altogether $51,031,466, or an excess of expenditure over all our revenue of $1,686,000. Yet the Minister of Finance comes down and tells the people of this country that he has a surplus of $8,000,000. So great a change has been made in the public accounts in the manner of dealing with capital account, that I think the time has now arrived when the consolidated fund account and the capital 'account should be merged in one, so that a full and complete statement of the finances of this country would be given to us, by the Minister of Finance, and we should know exactly whether there is a surplus or a deficit, I trust that will be done, I think we are nearing the time when it ought to be done, and I am quite sure that only then will the people come to realize the fact that instead of having a surplus at the end of the year, we are gradually getting deeper and deeper into debt.

Now the government say that they reduced the debt last year by $779,640. It does seem a very strange thing how a government that spent $1,688,000 more than its revenue, could possibly have something to apply in the way of reducing the national debt. Well, it is simply a matter of bookkeeping. The Finance Minister paid the sinking fund which he was compelled by law to provide for, $2,465,640, he paid that over, and when he found lie was short $1,686,000, of meeting the expenditure, he borrowed back the sinking fund again, not only enough to pay his deficit, but he actually borrowed the whole sinking fund back, and then he was able to show a reduction in what he calls the net debt of $779,640, although the gross debt of the country is larger in 1900 than it was in 1899.

We are constantly met with the statement that the Conservative party when in power also increased the national debt. We never-denied it. The Conservative party were justified in doing it because they had great public works to construct. We constructed the Canadian Pacific Railway at an expenditure of $65,000,000. We spent $36,000,000 on the canals. We spent $20,000,000 on the Intercolonial Railway. When the provinces were hard run for funds we gave them $10.000,000, and there were other items amounting to $11,000,000, making a total of $142.000,000 spent on capital account by the Conservative government from 1S78 to 1896. Of that amount $24,000,000 was met out of revenue, leaving the increase of debt only $118,000,000. Hon. gentlemen opposite taunt us with this. The hon. Finance Minister taunted us with it in his budget speech, but I ask any gentleman in this House to rise and say if he can, that we should not have expended money on any single item I have enumerated. I)o hon. gentlemen opposite object to the construction of the Canadian Pacific Railway ? I had occasion once before to read the opinion of the Hon. O. W. Ross with respect to that, and I need not repeat it now, but I can point to the fact that that expenditure is approved of by all classes of the people of Canada today. The Minister of Trade and Commerce (Sir Richard Cartwright) has ventured to apologize for the $7,000,000 Increase in the national debt during the regime of the Liberal government. The Conservatives have no apology to offer because every dollar of their expenditure was justified. The hon. gentleman (Sir Richard Cartwright) told us in explanation that the Crow's Nest Pass Railway had to be built and that it cost $3,500,000. He ought to have selected something that would have better justified the increase of the national debt than the Crow's Nest Pass Railway. He should have omitted that apology because I believe that had the subsidy originally granted by the government of British Columbia been used solely for the purpose of constructing that road, only a very small subsidy indeed would have been required from the Federal government. The South African appropriation of a million and a half dollars had the hearty endorsement of the people of Canada and the hon. gentleman (Sir Richard Cartwright) need not have apologized for that. There is another item of one million dollars loss sustained in the sale of our bonds at a low rate of interest last year, which the Minister of Finance charges to capital account, and that is another reason why the two accounts should be merged in one. While we realize a million dollars less on our 24 per cent bonds than if we had placed them at a higher rate of interest, I do not say but that we will get a return for that million dollars-yet when the saving in the payment of interest comes back to the people of Canada it will be credited to consolidated revenue account, whereas the loss itself is now charged to capital account.

The question was discussed by the Minister of Trade and Commerce as to what became of the large surpluses which he claimed the government had during the past two or three years. He told us they had a surplus of $12,000,000 for the past two years, and his explanation of how that money had disappeared was in my opinion very *unfair, as I intend to prove. He said that when the Conservative party went out of power it had left large undischarged liabili-

ties amounting in tlie ease of the railway subsidies to several million dollars, but lie failed to show that one single dollar of these subsidies had been earned. Consequently they were not a charge upon the country at that time and therefore should not he considered as a liability of the late government. The hon. gentleman (Sir Richard Cartwright) said that some $10,000,000 or $12,000,000 had been spent to complete the canals, and this he charged hack as a debt of the Conservative government. Well, Sir, just to find out how much of this ten or twelve million dollars was due to contracts of the late government, my hon. friend from Wentworth (Mr. Smith) put a question on the Order paper the other day asking what amount was paid by the government for the construction or improvement of the canals in each of the years 1897, 1898, 1899 and 1900, and how much was paid on account of contracts entered into by the late government and not re-let. To my surprise the government answered that of the sum of $12,095,087 paid on canal construction during the last four years, only $4,132,251 was paid on account of contracts let by the late government, and not re-let. The Minister of Trade and Commerce (Sir Richard Cartwright, therefore, was misleading the House when he accounted for the disappearance of the surplus by saying that the present government were compelled to assume the liabilities of the late government on canal construction to the extent of ten or twelve million dollars.

' Well, Sir, another of the promises of the Liberal party was that they were to reduce taxation. Instead of that we find as usual the very reverse. The gross taxation from customs duties which was $20,219,000 in 1896 had risen to $28,889,000 in 1900, and the total taxation of the country has risen from $27,759,000 in 1896 up to $38,242,000 in 1900. The Minister of Customs (Hon. Mr. Paterson), in his very able speech the other night told us that the government could not help it and he led us to understand that they were perfectly powerless In the matter. He said there were more goods coming into the country and that that was the reason why there was a larger revenue. But, if a proper fiscal system were adopted by the government, even that would not cause such an enormous increase in taxation. In 1899 they had a surplus of $4,837,000; in 1900 they had a surplus of $8,054,000, and we are told that next year there is to be a surplus of $6,500,000. In the face of this no effort! is being made by the government to stop the growing taxation. It means taxation which they say is not necessary, but unfortunately at the end of the year we find that this money is used to meet the expenditure of the country. No man ever condemned in stronger language than did the Minister of Customs the surplus of Sir Leonard Tilley in 1883. On that occasion he said : Mr. HENDERSON.

When the government find that they have beyond a doubt a surplus, when they can calculate with certainty on having one, it is their bounden duty to reduce taxation. It is no part of the duty of a Finance Minister to extract more money out of the pockets of the people than is absolutely wanted to carry on public affairs.

What would be said of a Chancellor of the Exchequer in England if he could not estimate the requirements of the public service nearer than ?82,000,000 ? He would be ridiculed as being unable to grasp the financial conditions of the country.

And yet $82,000,000 compared with the immense revenue of Great Britain is not more than $S,000,000 as compared with the revenue of Canada. We must therefore conclude that it is the opinion of the Minister of Customs, that the present Finance Minister (Hon. Mr. Fielding) has not a proper grasp of the financial conditions of the country. Sir Leonard Tilley in 1883 found no difficulty in disposing of the surplus. He did not allow it to grow from year to year. He did not desire to take more money out of the pockets of the people than was necessary to meet the ordinary affairs of the country. He struck the duty off tea and coffee and in that way disposed of a large part of this excessive revenue, the same as Mr. Foster did in 1891 when he found he had more revenue than was necessary to meet the current expenses, he drew his pen across the duty on raw sugar and gave back to the people of Canada during the next five years about $20,000,000, thus helping them to tide over the depression of these years. But the present government say : Oh, we

cannot help it; we are powerless; there are more goods coming into the country. Can they not adopt the policy of their predecessors in this matter as they have adopted the policy of their predecessors in many other matters ? Would it not be possible to-day to reduce the enormous taxation of this country which they tell us is not required to meet the ordinary expenditure ? What is to prevent the Finance Minister wiping out the total duty on raw sugar which amounts to $1,828,084 ? Let him strike that item off and he will find that he has a very considerable reduction in taxation. There are many other articles which might be dealt with in the same way, such as dried fruits, nuts, oranges, lemons, and so on. Then, there was the enormous increase in the tobacco duties of about $1,000,000 a year, which might be removed. You could also take off the duty on rice. In this way three or four million dollars of duties might be taken off, and the taxation reduced. It seems to me there is a great deal of truth in what the Minister of Customs (Hon. Mr. Paterson) said in 1883, that the Finance Minister evidently had not a grasp upon the financial condition of the country.

Before leaving the question of the sugar duties, I desire to draw attention to some statements which were made a couple of evenings ago. In the year 1900 we paid

an increased duty on raw sugar of $489,966, and on refined sugar $35,819, or a total increase of duty on raw and refined sugar of $525,785, more than we would have paid if the policy of the Conservative party had been still in force. Yet the hon. gentleman claimed great credit the other night for having reduced the protection on sugar. Now, what was done ? Mr. Foster left the duty on raw sugar at 50 cents per 100 pounds, and the duty on refined at $1.14 per 100 pounds, giving a protection of 64 cents per 100 pounds to the refiners. Had Mr. Foster continued to be Finance Minister I do not suppose for a moment that he would have allowed that duty to continue. As soon as the revenues of the country did not require the duty, I have no doubt that he would have removed it, and given back to the people from $1,000,000 to $1,500,000 a year in the shape of sugar duties. But the other night the Minister of Customs, while claiming credit for having reduced the protection on sugar, had to admit that he had increased the duty on raw sugar by 18 cents per 100 pounds, which amounts to an increase of nearly half a million dollars of taxation, all of which goes into the treasury. In 1897 the government placed a duty on raw sugar of 50 cents per 100 pounds and on refined sugar of $1 per 100 pounds, leaving a protection to the refiners of 50 cents per 100 pounds. The other night the Minister of Customs charged that the Conservative party had given too much protection because they had given a protection of 80 cents per 100 pounds in 1891, and in 1895 had brought that down to 64 cents ; and he said that if the sugar manufactories could live with 64 cents per 100 pounds protection in 1895, why could they not do so in 1891 ? Yet we find the hon. gentlemen pursuing a course of very much the same kind. Although the refiners had a protection of 50 cents per 100 pounds, we find the hon. gentleman in 1898 increasing that i>rotection to 56 cents per 100 pounds for the benefit of the sugar barons whom we used to hear so much about. In 1900 the duty on raw sugar was 68 cents per 100 pounds, and the duty on refined sugar $1.24, or a difference of 56 cents per 100 pounds, being six cents more than in 1897. And yet the hon. gentleman skimmed over that part of his address very nicely, and tried to leave the impression on the minds of the people that he had kept the protection down, when he knew that he had given these sugar lords $150,000 more protection than they had in 1897, on an imports of 250,000,000 pounds. I am very glad to see the hon. gentleman in his seat.

Topic:   WAYS AND MEANS-THE BUDGET.
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The MINISTER OF CUSTOMS.

As he is in his seat, might he ask you if the protection is as great now as it was under Mr. Foster ?

Topic:   WAYS AND MEANS-THE BUDGET.
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David Henderson

Conservative (1867-1942)

Mr. HENDERSON.

I should decidedly think not; but what I mean to say is that you have not followed out your own policy. The hon. gentleman came down the other night and in language as loud as thunder, blamed Mr. Foster for giving protection to the sugar refiners of 80 cents in the early nineties, which he reduced to 64 cents in 1895, although the hon. gentleman himself did in 1898 increase the protection from 50 to 56 cents.

With regard to the rate of taxation, which is perhaps the most disputed question we have before us at the present time, the Finance Minister and the Minister of Customs differ, one saying that it is one thing, and the other saying that it is something else. I do not believe either is right. The rate of taxation is a simple problem which any schoolboy of ten years of age can solve for himself. If he has the figures before him, there is nothing difficult about it. The hon. gentleman says he did not make up the figures, that they were made up in his department. I am saying nothing against the officers of his department; but I have no doubt that the hon. gentleman told his officers what data they should take to make up the rate of taxation. That is the way the country was misled. The Minister of Finance says the average rate of taxation last year was 16-41 per cent, while the Minister of Customs puts it at 15-98 per cent. Then the Minister of Finance, in order to show how much better off we are now in that respect than we were under the Conservative regime, takes the highest year during the last four years of the Conservative regime, and compares that with the lowest year of the Liberal regime, and makes out a reduction of something like 2 per cent. He says that if the Conservative party had remained in power, notwithstanding the immense revenue that was raised last year from customs, we would have taken out of the pockets of the people last year $3,292,230 more than we actually did. The statement is an absurd one, because if the Conservative party had remained in power they would not have allowed these customs duties to remain as they were when the money was not required. Mr. Foster, I have no doubt, would have again struck off the duty on raw sugar. He should have done, as Sir Leonard Tilley did in 1883, when he struck the duty off tea and coffee, and as Mr. Foster did in 1891, when he took the duty off raw sugar. Yes, as Mr. Foster did in 1894, when he put on the free list from 175 to 200 articles and reduced the duty on many others, particularly agricultural implements. Why the Conservative party found no difficulty jn managing the finances of the country so as to prevent millions of money being taken from the pockets of the people from year to year, which were not required for the purpose of the government.

Hon. gentlemen opposite, when out or power, promised that if returned to office they would reduce taxation. We have seen, however, the Finance Minister getting up deliberately and saying he did not intend to reduce taxation. And wo had the Minister of Customs saying the other night that they had reduced the rate of taxation. Where are we to find these lion, gentlemen ? Let me read an extract from a speech delivered'by the hon. the Finance Minister, in which he said :

When we reduced the tariff in 1897 we made a large number of changes which, in the main, were in the direction of lower taxation. We reduced the duties on many articles, we added a number of articles to the free list, we made large changes in the way of reduced taxation. It was of the utmost importance that we should maintain a strong financial position, and in view of the uncertainties as to the amount of revenue that might be produced by the lower rate of taxation, it became necessary that we should take some steps to make good any possible loss that might result. It was thought that it might fairly be met by providing for the raising of some additional taxation in order to balance, or make good, the loss occasioned by the reduction of duties.

Again, lie said :

It was necessary _to have an increased revenue in certain directions when we were to lose revenue in other directions.

There we have a direct declaration by the Finance Minister that, notwithstanding all their promises and pledges to reduce taxation, they did not intend doing so. The government simply Intended to play the game of taking a little off on the one hand and adding as much more on the other, and thus, in the language of the hon. gentleman, prevent any reduction in the revenue of the country, and maintain a firm financial position.

With reference to the actual rate of taxation, let us see what it really is. In 1800. the total imports of this country, dutiable and free, amounted to $154,051,593, but in that year there was imported into this country and entered for home consumption, $6,302,683 of corn, which never entered into home consumption at all, but passed through the country. It entered at one port and passed out at another, although it appears under the heading of goods brought into this country for actual consumption. We are, therefore, justified, and the Finance Minister says we are. in deducting that amount from the gross imports. This leaves a net import for home consumption of $147,688,910.

!In 1897, a change was made in the law with regard to the duty on tobacco, and $1,151,345 were added to the duty on tobacco in 1899 by this change. The hon. gentleman may say that this is excise and not customs. But, it makes no difference to the people whether that tax is collected as an excise or a customs duty. It is none the less a tax, and an increase in taxation. It is one of those taxes which Mr. HENDERSON.

the Finance Minister said he would add in order to make up for something that he took off-in order to maintain a strong financial standing in the country. Adding to $25,734,228 customs duty in 1899, the increased tobacco duty of $1,151,345, we get a total taxation for that year of $26,885,573. It is now an easy matter to show the average rate of taxation, by simply dividing the total duty by the total imports, and I find that the rate for 1899 was 18-20 and not 10'70, as stated in the blue-book. Let us deal in the same manner with the imports for home consumption in 1900, and deduct the corn that simply passed through the country, although entered for home consumption. It should not have been so entered, and was not by the previous government, at id if we are to have a fair comparison, we must have the same basis of comparison.

Total imports in 1900 *480,804,316

Less Indian corn exported 4,757,595

Net imports $176,046,721

Total customs collected $25,559,110

Increased tobacco duty 991,995

Total $29,551,105

Making a total taxation of $29,181,185, or an average rate of 10-98 instead of 15 98, as entered in the blue-book by.the Minister of Customs, which the Minister of Finance said was all wrong.

We have no difficulty, then, in finding out whether we have now a higher or a lower rate of taxation than before. I am not going to take one year, because the fairer way is to take the full four yeas 1S97, 1898, 1899 and 1900, and compare them with the last four years of the late Conservative government. Taking the Trade and Navigation Returns, I find that the rates of taxation were as follows, for last four years of Conservative rule :-

1893

$17 381894

17 131895

16 991896

18 28Total

$69 78

or an average of 17-45 for the four years.

Compare that with four years of Liberal rule :

1897

$17 871898

16 951899

18 201900

16 98Total

$70 00

or an average of 17-50 per year.

Thus, the average of the last four years of Conservative rule was 17-45, and of the first four years of Liberal rule 17-50, showing an increased rate of taxation of l-20th of 1 per cent.

But the hon. the Finance Minister said that in order to maintain a strong financial position, when he was compelled to take the duty off one article he had to put it on

another. If he had done that fairly, perhaps no great exception could be taken. But, in all these shifts of duty from one article to another, a great deal of unfairness has been dealt out to the people. Let me give you a few illustrations. For example, the duty on pianos was reduced by 5 per cent, but, in order to maintain a firm financial position in the country, it was necessary that the loss should be made up from some other source, and, consequently, the hon. gentleman added 5 per cent to the farmer's cutter. Why transfer 5 per cent from pianos and put it on a cutter ?

Then, they took the duty off corn for the benefit of the farmers of the western states, and they did this without asking the Americans permission to send our barley into their country free of duty. They also took the duty off binder twine and made it free, and then, in order to maintain a strong financial position, which the Finance Minister sajd he was compelled to do, they made every man who uses tobacco contribute to make up the loss sustained by the reduction on corn. On what principle is every workingman on a farm compelled to contribute to the revenue in order to please the farmers of the western states ?

And here again, I say the government made another blunder. They did not ask that twine should be admitted free into the United States. They gave free twine to the United States, and allowed the Americans to retain the duty of 20 per cent on manila twine going into that country. We have manufactures springing up all over the country for the production of manila binder twine, and I say it is not fair to these people who are putting their money into that industry that the United States should be allowed to send their product here free of duty and our manufacturers, if they have a surplus, if they want to ship a few tons of manila twine into the United States should be met with a duty of 20 per cent. If we were willing to give free twine, we should have exacted free twine-no preference should be given to the United States manufacturers that was not given to the Canadian manufacturers. I do not believe in a one-sided policy. Then, they reduced the duty on iron and steel. But, in order to maintain a strong financial stand, they put over half a million dollars of increased duty on sugar. Thus, whilst the bloated manufacturer who makes all these agricultural implements about which we heard in the past is given a reduced duty on iron and steel, the man who wields the sledge for him, who works at the forge or the bench is compelled to pay more for his sugar in order that his master may get his iron cheaper. Where is the fairness of that ? Well, then they go to the farmers a,nd tell them what they are going to do for them. The hon. Minister of Finance in his magnanimity says : We will reduce the duty on scythes. Scythes-that went out of use forty years ago. But, in order to main-73

tain a strong financial stand, he doubles the duty on grindstones. Then, we come to cotton goods. They reduced the duty on white cottons, but, in order to maintain a strong financial stand, they increase the duty on coloured cottons. The man who wears a white shirt, such as the hon. Minister of Customs or the Minister of Finance is protected all right. The duty on their goods is a little less than 17 pel' cent. But the farmer, the toiler, the man who works in the foundry or the shop, who cannot, by reason of his occupation wear a white shirt is compelled to pay 35 per cent. Where is the fairness in that ? These hon. gentlemen say : Why does not he buy it in England, for the preferential tariff reduced white cotton from 25 per cent to 17i per cent. But the duty on the coloured shirt is not reduced by the preference, for the simple reason that we do not bring these goods from England. The heavy coloured cotton goods, the ducks, the denims, the cottonades, the heavy cotton shirtings, do not come from the old country, but from the United States, because the American goods are better in quality. What I am saying I saw in the presence of a gentleman who is a large importer and who knows whether the statement I make is correct or not. I did not consult him before making it. I make it from personal knowledge that these goods are not, to any extent, imported from England. The English goods of that class are not what our people want. The fine cotton wool is used in England for making the muslins, the lawns, the laces, &e., that come to us from that country, while the coarse cotton fibre is allowed to go into the coloured goods, and so an inferior article is produced. The Canadian consumers want either the Canadian goods made out of the gen-real run of cotton, or the American goods, and they will pay higher prices for them rather than take the inferior goods that come from England. So, there is no competition between the heavy coloured cotton goods coming from England and those coming from the United States-one has no effect whatever upon the other. We were told the other night that because there was a reduction on goods coming from England, therefore,-this is what the Minister of Customs said-every dollar's worth of the same class of goods coming from the United States would come in at a reduced price. But in this case there is no competition, and so the workingman, the toiler, is compelled to pay the higher duty on these heavy coloured cotton goods-100 per cent more than that on the white goods. Is that fair treatment ? The duty on silks is reduced, but the poor man's rice is taxed to make up for it, so that the government may maintain a strong financial stand. And look at the unfairness of the matter even with regard to silks. The lady wants a nice silk dress-we will not say even the finest article, but take goods at about $2 a yard in the old country.

That is brought in at a duty of 30 per cent making a duty of 60 cents a yard. Under the preference, this is reduced one-third, so ifuat the lady who wears a dress at $2 a yard gets a reduction of 20 cents a yard. But the domestic, or the wife of the workingman, who cannot afford to buy silk at $2 a yard, but is satisfied with a dress costing originally 40 cents a yard and sold here, with profit, duty, and other charges added at about 75 cents a yard, instead of getting a reduction of 20 cents a yard, must be satisfied with a reduction of 4 cents a yard. And all the way through this tariff, there is the same unfairness. The poor man, the poor woman, the toiler is compelled to bear the burden, the benefit going to those who are better able to pay. The government reduced the duty on coal by 7 cents a ton to help the great railway corporations. But, to maintain a strong financial position, they increased the duty on furs by 5 per cent. Bo, if a farmer wants a fur coat to wear when driving into town, he must pay more for it. If he wants to buy a fur coat for his wife, he must pay 5 per cent more for it. If he wants a pair of mitts, if he wants a sleigh robe, he must pay 5 per cent more. Go through the country and many of the farmers you meet have good fur coats. The increase of duty on their furs goes to pay the duty on the rich man's coal-that is the effect of the tariff. Then, they reduced the duty on salad oil, which was 30 per cent, but which was brought down to 20 per cent. This was for the benefit of the rich man, because the poor man has not salad oil on his table every day. Then, in order to maintain a firm financial stand, they Increased the duty on batts and wadding. They reduced the duty on flowers and feathers, and, to maintain a firm financial stand, they looked around to see something that could be taxed. Here, they say are a fine lot of fellows going up to Muskoka hunting : these are sportsmen and do not mind a few dollars; we can bleed them-and so they raised the duty on guns from 20 per cent to 30 per cent ; and not a gun comes in under the preferential tariff. Then they considered the case of the farmer Imilding a new house. He is putting the windows into it and the government increases the duty on the putty he has to use-they could not allow the farmers even to have that. They take the duty off mushroom spawn-for whose benefit I do not know ; but, to maintain a firm financial stand they increased the duty on putty by 33J per cent. Then they took up the case of the farmer's wheat, and said to the farmer : You are getting too much protection on your wheat. And so, they reduced the duty on wheat and flour, but they were very careful to maintain a firm financial stand by leaving the old wagon to pay 25 per cent. Then, in their magnanimous way, they reduced the duty on scythes, snathes and reaping hooks, hay rakes, and even on the old fashioned flails.-two sticks Mr. HENDERSON.

tied together with a string-all these old things that became obsolete, thirty, forty and even fifty years ago-they reduced the duty 10 per cent on every one of these. But desiring to maintain a firm financial stand, they were careful not to give a dollar of reduction on the plough, the harrow, the sulky rake, the mower or the binder. That is the policy of the present government with liegard to the tariff, and that is how it is that they managed to tax the people and how they maintain a firm financial stand while still declaring that they have made enormous reductions. They make reductions on the one hand and then make up by increases in some other way.

Now I desire to say something with reference to the preferential tariff. The manufacture of woollens has been spoken of as an illustration of the injurious effect of the preferential tariff. Why was this preferential tariff ever introduced ? It was long a puzzle to me to know why the government . had introduced a preferential tariff until the Minister of Customs disclosed the secret the other night, and in his own words, he said it was entirely out of love for Great Britain. Well, I am thankful, Mr. Speaker, that I belong to a party that does not require to pass an Act of parliament to show our lovo to Great Britain. We never required to pass any specific legislation to show that we were loyal to Great Britain. I am not going to accuse those on your right of disloyalty, but when we look back for ten years and see their various policies -continental free trade, unrestricted reciprocity, commercial union, and all those other policies, it is no wonder, I say, that when they came into power they felt it necessary to pass an Act of parliament and do something to show that they were as loyal, at least, as the Conservative party. Now with reference to woollen goods, of which complaint has been made, I apprehend that there are very strong grounds for the complaint. I realize that fact, because I am personally acquainted with woollen manufacturers in my own county, and from the accounts that I get from them the condition of that industry is a very serious one. This afternoon we had the statement made by the hon. member for Peterborough (Mr. Kendry), and we had that statement flatly contradicted by the hon. gentleman from Vancouver (Mr. Smith). Now, the member for Peterborough knew what he was talking about, he had a personal knowledge of the facts ; the member for Vancouver had no information except what he had got from some outside source, and wbicn he was unable to verify. However, I give the hon. member for Vancouver the full benefit of his contention. He said that the Auburn mills had been running for the past four years ; whether he was playing on words and meant that they had been running behind, I do not know. But I will give him the credit for having the information that

the mills had been running night and day for the past four years, although that is a strong statement. Now I do not doubt the fact that during the past three or four years those mills have been very busy. 1 know the same thing occurs in my own county. There is a firm that manufactures yarn and blankets, and until last fall they had been busy, running full time, aluiough they told me they were not making money. But you know that every manufacturer in this country has a barometer, and that barometer tells him exactly how his trade is extending. He sends out his agents all over the country to get orders, and these gentlemen come back or report back ; they are not getting orders, they are getting nothing ; orders are not coming in. The manufacturer at this season of the year ought to know exactly how many dollar's worth of goods he is going to sell during the next six months. The man who manages the Auburn mills knows now what his trade is going to be for the next six months, and he knows whereof he speaks. The member for Vancouver knew nothing about it, and consequently was not able to give information. I am sorry to say that there is too much ground for the complaint that has been made, and I do hope in the interest of the people of this country that the appeal of this large industry will be listened to by the Minister of Customs and by the Minister of -Finance. To show the condition of affairs I will make this statement: In the year 1898 there were $7,985,847 worth of woollen goods entered for consumption into this country ; in 1900 that had increased to $9,809,565, or an increase of $1,823,719, an increase of 221 per cent over the importations of two years ago. What would that be in four years at the same rate ? An increase of 45 per cent. Where will the woollen industry be if this state of affairs continues for five or six years ? We can expect to find it exactly where the hon. member for Centre Toronto (Mr. Brock) told us the other night we would find this industry. He said there were only three alternatives ; one was to close down, the second one to run on half time, the third to reduce wages, and he feared the latter one would be followed. We know what the consequences would be. Men would not accept half wages in this country, they would go where they can get paid for full time. Now, 224 per cent of a reduction in the output of a factory certainly means at least 224 per cent in the profits of manufacture alone ; it means 30 or 35 per cent in; my opinion, and to the workingman it means a reduction in his wages of from 25 to 30 per cent. I say the condition demands the most careful attention on the part of those who control public affairs.

I wish to make a reference to another industry, the manufacture of gloves and mitts. In 1898 we imported $504,0S1 worth ; in 1900 we imported $703,009, an increase in 734

only two years of $138,928, or an increase of almost 25 per cent. You see that in four years half the output of the glove factories of this country would be captured by the foreign trade, and what would be the result ? But this is perhaps not the worst feature in the matter. The glove manufacturers are not only met by competition, but they are met by an article produced by cheaper labour, with cheaper fuel, with cheaper money, and their raw material is taxed in order to maintain a firm financial standing in this country. Take the raw material of a glove manufacturer, take the fur goods ; the amount of imported fur, goods which come from France, Germany, Russia and the United States, was 64 per cent of the entire import, so that only about 36 per cent came in under the preference. Of sewing silk and twist, 38 per cent came in from the United States, only a fraction of the silk came in under the preference. Take wool felt, at 35 per cent, used by glove manufacturers as lining, there came in from the United States 90 per cent of the whole import; and of glove leather which forms the foundation of the whole business, out of which the glove is made, 99 per cent came in, not under the preference but from countries with which there is no preference ; only 1 per cent of the glove leather coming into this country under the preferential tariff. So that practically the man who makes gloves in this country-and it is a very large industry-is subjected to a very heavy competition under the .preferential tariff ; and when he comes to buy the raw material he is not permitted to buy It under the same favourable terms. How is a man going to compete and pay living wages to workingmen under circumstances such as these ?

The Minister of Customs said the other night when addressing this House that we are buying woollens cheaper because of the preferential tariff. Now, I speak as a business man of twenty-five or thirty years' standing. I do not believe the people of this country on the whole are buying, quality for quality, woollen goods any cheaper than they were buying them five years ago. We never had better woollen goods, better tweeds, or cheaper tweeds, than we had under the reign of the national policy. We never had cheaper agricultural implements than under the national policy. With regard to these woollen goods, I say the preference affects the Canadian manufacturer because there are more goods coming in. And how is it that there are more of these goods coming in if they are not being sold cheaper ? There are reasons for that. There is a quality of English goods with a fine finish but not possessing the wearing qualities of the Canadian tweeds, and that captures the eyes of those who are not judges. They are not cheaper goods, but if you take them quality for quality at the same price they *are the dearer goods of the two. The pre-

[DOT]2311

ference given, on woollen goods is equal to about $600,000, and that $600,000 is simply a bonus given by the government of Canada to the manufacturers of Great Britain ; a bonus which they use for their own benefit. 'They devote a large part of that money towards the employment of agents who go through Canada pressing the manufactures of Yorkshire and Lancashire on the people. The Minister of Customs told us that the woollen manufacturers should use more energy in the business and they would succeed, just as the Minister of Trade and Commerce (Hon. Sir Richard Cartwright) told the manufacturers twenty-two years ago to [DOT]go home and eat less and work more. The 'government is giving to these English manufacturers a bonus equal to $600,000, and that $600,000 is being made use of by these men [DOT]to pay their agents and push their wares in this country, not at a cheaper rate, but every one knows how a business can be increased if it is pushed. That explains how it is that the manufacturers of this country [DOT]are not keeping the trade of the country. [DOT]If we gave our own manufacturers a fraction of this $600,000 to enable them to push their wares in the country, they could meet the competition to a certain extent, but the Canadian manufacturers have to do that out of their own pocket, while the Canadian government actually furnishes the English manufacturers' money to do so.

The total imports under the preferential tariff last year amounted to $27,095,791, and on that there was a duty paid of $5,639,035, and 25 per cent preference would amount to $1,879,676. That is what was lost to the revenue of this country last year, and the Minister of Customs (Hon. Mr. Paterson) says that was saved to the people of this country. Why, Sir, it has to be made up in some way. The duty on raw sugar just simply balances it in order to maintain our firm financial standing. If you take the duty off raw sugar you would save to the people of this country just as much as you would save to them if they got every cent of the preferential duty. Ton have your choice. Take the duty off raw sugar, the total of which was $1,863,903. or on the other hand, take 25 per cent off the duties on goods coming from England, which amounts to $1,879,676, but I contend that the latter is not saved to the peolple of Canada. I do not believe that more than a small fraction of that goes into the pockets of the people of Canada. I wonder if the Minister of Customs will stand up to-day and say that we buy all our goods cheaper because of the preferential tariff. I hold in my hand a small article which costs the people of this country over $2,000,000 a year. It is a small article which enters into every household of the Dominion of Canada, and cannot be done without. I tell you that for that small article the people of this country under the present tariff pay $1,000,000 more than they did

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CON

David Henderson

Conservative (1867-1942)

Mr. HENDERSON.

in 1895. There is the article. It is a common spool of thread. Any lady will tell you that in 1895 she bought two of these spools for five cents, but go down Sparks street to-day and you can only get one for five cents. The price has increased 100 per cent. Why is this so ? The government tinkered with the tariff. If they had let the tariff alone it possibly would not be so. Under the old regime spool thread came in at a duty of 25 per cent, but thread in banks not spooled came in at 12J per cent, and the difference of 121 per cent protected the man who spooled the thread, and that was enough to enable him to make a profitable living and to sell cheap thread. But this government said : We will leave

the 25 per cent on spool thread, but we must maintain a firm financial standing, because we have lost it on something else, and they raised the duty on hank thread up to 15 per cent, and then the preferential tariff was applied. As it stands now, there is one-third off the 25 per cent, or about 161 per cent duty on the spool thread, and 10 per cent on the hank thread, or a difference of 61 per cent now as against 121 per cent formerly. The government cut the protection in two until the men who spooled the thread in Canada had to go out of business or do what men in desperation will do, join the combine, one of the largest in the world to-day, namely, the great English and American Trust of Spool Thread. By joining the combine, they get their price for spool thread, and instead of 21 cents, a spool of thread costs 5 cents to-day. If you take the quantity of thread that is imported in hanks to this country and convert it into spools, you would find that it would make about 32,000,000 spools, and as there are about 18,000,000 spools imported, this would give a total of 50,000,000 spools, or a consumption of about fifty to each family. The former price was 21 cents. They are now sold in some places at 4 cents and in other places at 5 cents, or an average of 41 cents, an increase of 2 cents, and 2 cents per spool on the 50,000,000 spools means exactly one million dollars more than the people of Canada have to pay for that little spool of thread to-day than they did five years ago. They have to pay that in order that a firm financial standing should be maintained in the country.

Let us consider why this preferential tariff was introduced at all. The Minister of Customs told us it was love for Great Britain, but I have often thought it was hatred to Germany-not so much love of the mother land as dislike to the father land. I shall not discuss that to-night, however, but I do say that whatever was the cause of the preferential tariff being introduced, it has proved a very disastrous thing for the people of Canada, as we are beginning to realize now. Let me ask : do the farmers get any benefit from it ? Why, our cattle today in the British market have no prefer-

ence, although we give millions of dollars to help the manufacturers and workmen of Great Britain. They took from us last years some 7,000 head of cattle less than they did two years before. In the last three years of the Conservative regime fat cattle in Great Britain realized an average of '$75.94 each, and for the first four years of Liberal rule they only realized an average of $00.57, or a decrease of $15.36 per head, notwithstanding the preference we gave to the people of Great Britain. Now, Sir, notwithstanding the fact that we open our doors to Great Britain, she is closing her doors to us. Two or three articles were mentioned the other evening in which there was a decreased export to Great Britain, and the junior member for Halifax (Mr. Roche) complained that only a few were mentioned. At his request I shall name a few more and I shall make them of a diversified charter. Great Britain in 1900 took less from Canada than she did in 1898 of the following articles, and to the amount stated:

Leather, sole and upper $ 2,750

Sewing machines 3,170

Agricultural implements 12,000

Carriages 42,000

Wood pulp 114,000

Pine deals 565,000

Wood and manufactures of 740,000

Beans 37,000

Oatmeal 69,000

Hams 466,000

Horses 643,000

Oats 586,000

Animals (all kinds) 398,000

Pish all kinds 922,000

Flour 2,289,000

Wheat 5,127,000

Total breadstuffs 7,273,000

Of corn we sent none to Great Britain in 1900, although in the same year Great Britain took from the United 'States 5.413,000 bushels more than it took in the previous year, notwithstanding the fact that the United States gives no preference to Great Britain at all. Of cattle we sent to Great Britain 7,600 less ; of cheese, 10,000,000 pounds less, and of eggs 171,000 dozen less. We sent more bacon, butter and apples, because we produced a great deal more.

Now, let us see how Great Britain treated the United States. She took from the United States large increases in 1900 over 1898, notwithstanding the fact that the United States gives no preference. She took from the United States in 1900 the following increased amounts over 1898 :

Corn

Canned beef Beef, fresh Pork, fresh

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?

Tallow ...

Lard

Hams

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?

Cheese ...

Horses....

Now, let us see for one moment what we

have lost in addition to all this. It has been stated over and over again that the present government have not secured for the great agricultural classes of this country a single market. Not only have they not secured a new market, but unfortunately they have lost an old one. The wheat exports of Canada to Germany in 1898 amounted to 199,747 bushels, and in 1900 to 92,839 bushels, a decrease of 106,908 bushels. Of peas we sent to Germany in 1898 44,425 bushels, and in 1900 22,902 bushels, a decrease of 21,503 bushels. Of oats we sent in 1898 637,400 bushels, and in 1900 28,727 bushels, a decrease of 608,673 bushels. Of rye we sent in 1898 505,738 bushels, and in 1900 none. Why did we send in Germany in 1900 smaller quantities of these articles than in 1898 ? The United States sent to Germany of wheat in 1898 3,218,401 bushels, and in 1900 9,065,713 bushels, an increase of nearly threefold, whereas we sent a great deal less. Of wheat flour the United .States sent to Germany in 1898 190,039 barrels, and in 1900 691,782 barrels, an increase of 501,743 barrels. Of corn the United States sent to Germany in 1898 39,263,528 bushels, and in 1900 46,256,978, an increase of close on 7,000,000 bushels. Why is that market closed to us and open to the people of the United Statesi? Just because of the preference we gave to England. You know how the trade arrangements between England and Germany were disturbed and how the German government took offence at our action because we insisted on the denunciation of the treaty between England and Germany. Was it to be expected that Germany would treat us as it had treated us before ? Human nature in Germany is much the same, I suppose, as human nature in Canada. So Germany turned round and passed a discriminating law against Canada, placing a discriminating duty of 97c. a bushel on wheat, 3 3c. on pease, 4-4c. a bushel on rye-duties which are actually prohibitive, because they are more than the duties charged against similar products from the United States. The farmers in Ontario have been asking how it is that in Buffalo No. 2 spring wheat was selling last week at 77Jc. a bushel, whereas in Toronto wheat of a like quality was 'Selling .at the same time at only 68Jc. a bushel, or 9c. less than at Buffalo. The solution, of the problem is simple. The man who buys wheat in Buffalo can send it to the German market and sell It there at 10c. a bushel more than the Canadian buyer who buys in Canada. In that way he can give to the farmer in Buffalo 10c. a bushel more than the Toronto buyer can give to the farmer in West- York. That is one of the dire consequences of this tariff, which

was intended. I dare say, as a preference to England, but which turns out to be a very disagreeable thing for Canada. Wheat

sold in Canada in 1895 for 20c. a bushel more than the Liverpool price. To-day wheat of the same quality is selling in the city of Toronto at 16c. a bushel below the Liverpool price. See how our farmers are handicapped by the action which the government took, I hope unwittingly, under which they are actually selling their wheat, rye and oats for less than they otherwise would and under which the British market is taking smaller quantities of the other articles which we have to export, such as eggs and cheese.

Now, I realize that one o'clock having arrived, I have exhausted the reasonable time allowed to me, and I desire to bring my remarks to a close. I hope and trust that when the House comes to a vote on this 'question, it will weigh every argument well and give a fair verdict according to the evidence. If it does so, apart from all prejudice, I am sure that the motion of my hon. friend who leads the opposition will receive the hearty endorsement of the members of this House; because I am convinced as one who has listened to this debate carefully during the last ten days, that the arguments have been almost solely in favour of the contention of the opposition.

Before I sit down, I want to emphasize something which the Finance Minister drew our attention to a few days ago. In his budget sp'eech he told us that we were on the crest of the wave, and sounded a note of alarm. While he did not anticipate reverses, that was simply a matter of speculation, he said there was going to be a check on the prosperity of the country. He said the country was going to take a rest in order to get ready for another spring, and that it would go on again with leaps and bounds. It has occurred to me that we had better not take a rest. Let the government help those men who are engaged in the woollen industry, in the glove 'industry, and in all the other industries of the country. What is the use of closing up these factories ? Let the government amend their fiscal policy. From 1891 to 1896 was there any -country in the world that stood the depression of those years better than Canada ? There was not, because we had a sound fiscal policy which protected the industries of this country and our financial institutions. When in the United States the banks were going down by the hundred, in Canada they withstood everything and came through all right.

I do hope that the government will reverse its decision and give us a policy that will enable us to tide over those lean years -which the Finance Minister says are approaching in the near future-those years in which the pendulum will swing the other way. and thus enable the people to prepare for the crisis when it comes.

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LIB

Thomas Murray

Liberal

Mr. THOMAS MURRAY (Pontiac).

I am here, Mr. Speaker, contrary to the advice Mr. HENDERSON.

of my physician, in order that I may give my vote in the division - which, I understand, is to be reached to-night and while I do not propose to take up the time of the House at any length, I am unable to cast a silent vote on this occasion. I have taken a pretty active part in the political history of this country, and have always strongly opposed the so-called national policy, and intend opposing, with all my power, the resolution now before the House. I have always believed that the national policy was conceived and born and nourished in iniquity, and -died as it lived, and should be left at rest.

In 1867 I was a candidate. I was a pretty young man then, and am not a very old man yet-not quite old enough to be shelved in the Senate-and I have a pretty fair knowledge of the history of this country since confederation. Neither in 1867, nor in 1872, did we hear anything of protection or the national policy. It was only when the late Sir John Macdonald was hurled' from power, and when suffering penal servitude for his political offences, that that wily ipolitieian found it necessary to inaugurate some scheme by which he would get back into office. It was then that he conceived the idea of the national policy. I was a candidate in 1878, and my opponent then, Mr. Poupore, who was a strong man in the county, said to me : Murray, if you will only support Sir John and the national policy, I will retire from the contest and allow you to be elected by acclamation. Why, I said, what is it anyway ? What does it mean ? But, Mr. Poupore could not tell me the first thing about it. He, like many others, went it blind, and the country followed suit. The people of the county of Pontiac were told that if we only had protection, they would have home markets for all the products of their farms, and would get so much more for their butter and their eggs. Every little water power was to be utilized, and manufacturing industries were to spring up on every hand. The people allowed themselves to be seduced and charmed by all these promises, and returned the Conservative party to office. What followed ? We have not a single manufacturing Industry in the county of Pontiac today, although between here and Pembroke Is the finest water jjowei _o be found in the world. The people were deceived and lost faith in the national policy. Did Sir John Macdonald ever appeal to the people fairly and squarely on the merits of that policy, after it had been inaugurated ? No, but he introduced the infamous gerrymander Bill, and resorted to the system of appointing partisan revising barristers to fix up the lists, and it was by such means that he succeeded in retaining office.

In 1891 I happened to have the honour of representing the county, for which I now have a seat in the House. We know what then took place. We know that this very

bacl man Tarte-who was a very good man then in the Conservative ranks-made certain grave charges against the administration, which charges were proven, and we know that those charges and the failure of the national policy brought about the downfall of the late government in 1890. Was the country then in a state of prosperity? Not a bit of it. I have had an experience of forty years as a general trader, and I know that never was the country in a more perilous condition. Was it any wonder then that the Conservative party was hurled from office ? And is it to be wondered at that the present government should have been sustained at the last general election. At that election, the fiscal policy of this government was submitted to the severest scrutiny and discussed in every detail, and I venture to say that the hon. member fcr Halton (Mr. Henderson), who has just addressed the House, has simply being going over all the ground which he went over on the stump at the last election. All these arguments which we have heard in this debate were then put before the people, but the people gave their verdict, and that verdict was in favour of the present administration.

I was pleased to see the opposition elect their present leader (Mr. Borden, Halifax), because I think he is a very honest man, and disposed to do what is right. I was pleased with his utterances, but I think he made a mistake in introducing the resolution now before the House. I think we might well have given our attention to more important and practical matters. I was in hopes that this House would have got down at once to practical business and taken up questions in the general interests of the country. I expected that we would have grappled with some of the great enterprises before the country, for instance, the construction of the Ottawa and Georgian Bay canal. That is a work which should receive the attention of this House and government. The government, I believe, are doing something in the way of making surveys along the Ottawa and the French rivers, and I understand, irom some statements made by the Minister of Public Works, that the government propose to construct a canal at French river which will be a part of the general system. The construction of the Georgian Bay canal, however, is a national enterprise, the importance of which we cannot overlook. We have along the Ottawa river, dividing two great provinces, a water communication that to-day lies dormant. And the enterprise of building this canal, whether it be taken up by a company or by the government, should be entered upon at an early day. so as to develop the great resources of that northern country. I represent a county twice as large as England-a county which is to-day practically undeveloped, which has only fifty miles of railway, and which is

rich in agricultural and mineral wealth and in timber. Yet, although within a stone's throw almost of these parliament buildings, that county is still undeveloped, and I am sure I will have the sympathy and support of both sides of the House in my efforts to have the great resources of that northern country made productive. When northern Ontario is being developed, should northern Quebec be left to lie dormant ?

I do not intend to take up any more of the time of the House, but before concluding, I might say a word on this racial question which has been discussed in this debate. That question was used in my county at the last election. At the upper end of the county of Pontiac, which is occupied by Frenchmen, we had the right hon. the Prime Minister stigmatized as a traitor to his creed and race, and Sir Charles Tupper, forsooth, held up as the great champion of separate schools, and through these appeals I lost some votes. Then, in the lower end of the county, which is largely Protestant, the people were asked to vote against Sir Wilfrid Laurier because he was a Frenchman, and against Murray because he was a Catholic.

There is no question at all about it-these appeals were made. Some hon. members have stated that these things were not done in Ontario, that Ontario acted from national motive. But we know better than that. 1 know better than that as one who has been in the local legislature of Ontario. I know wliat the Conservatives did there, when they appealed to race and creed prejudices of the province on the question of separate schools and the use of the French language. I know all about it, and the country knows about it too. And my hon. friend from Bothwell (Mr. Clancy) was in that legislature also; and he knows it as well as I do, and he was a party to the business when I was there. Nothing more should be necessary to convince hon. members of the truth of what I say than the vote that took place on the motion of the hon. member for Victoria, N.B. (Hon. Mr. Costigan) the other day. Fifteen Conservatives from the province of Ontario voted against that, motion, and why ? Because they dreaded their constituents. I do not accuse these men of being bigots themselves. And two hon. gentlemen, one from one of the Yorks and one from Toronto, had the courage of their convictions and voted for the motion. And liow do we find a certain society in Ontario acting towards these men ? They pass resolutions denouncing them because they voted as their consciences dictated. Is that an evidence of the liberty of conscience or equal rights that these men talk about so much, or does it show that these prejudices exist ? These prejudices do exist in Ontario. The fact that fifty-eight members from the province of Quebec support the Liberal government is not due to the fact that the Prime Minister is a French-

man. It is because be is an honest and an able man and because he has been successful in the administration of the government of this country. Talking aljout Frenchmen, Irishmen, Englishmen or Scotchmen in this country-why it is ridiculous; it is time these cries were done away with. But it is not to be wondered at, human nature being what it is, if some did vote for the Prime Minister because of the recklessness with which he was abused on account of his race by the Conservative press of Ontario. The hon. member for West York (Mr. Wallace) said that the premier had appealed to the French Canadians and said : I am a

Frenchman; the same blood that runs in my veins runs in yours. When he was attacked in the manner I have shown, attacked on account of his race and creed, was he to say nothing in his own defence ? I will venture to say that he never asked a man to vote for him on account of his race or creed. I know that I have never done it, and I have been through more elections, probably, than any other man in this House. I defy any man to say that I have ever appealed for support on grounds of race and creed.

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March 28, 1901