August 8, 1904

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Some hon. MEMBERS

Sit down.

Topic:   WAYS AND MEANS-TARIFF COMMIS SION.
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CON

William Rees Brock

Conservative (1867-1942)

Mr. BROCK.

The hon. gentleman (Mr. Alex. Johnston) is very fond of interrupting. I have never interrupted him. The Minister of Finance told us some time ago that we were on the crest of the wave of prosperity Which, however, was likely to recede. Fortunately for this government, magnificent crops, the large inflow of immigration and the kindness of Providence have kept them afloat. But the industries of this country -not the little ones, ljut the great ones with millions of money invested-are not paying Mr. BROCK.

a cent of dividend and the stock is not worth one-third of what it was. I have not observed that the Finance Minister ever pointed that out to the people. He points to his enormous revenue and the great surpluses he is piling up. But these things begin to arouse the suspicion of the people. And, when we come to resolutions like this we begin to see what the whole thing means.

1 think the Finance Minister has found out that a little protection is better than the free trade theories he expounded some years ago. He is giving us protection in small doses ; but this country is prepared for a little heroic treatment. As we have gone back, the minister must do something to help, us forward, and he will not do it by this picayune business, this dumping clause-it is only the people who do not know anything about business who believe there is anything in it. If there is dishonesty now there will be greater dishonesty under the operation of this clause. People who want to be honest and straight, and who will not do anything but what is right, will act in conformity with the law. But they would do that anyway. But as to the rogue, I defy you to check him by any such clause as this. Of course you will check some rogues, but there will be enough damage done under this clause to more than counterbalance all the benefits gained through it. As I said, the only way to meet the reasonable demands of manufacturer and consumer and of the country generally^-and the minister will find it out-is through a system of ample protection. Not by any dumping clauses, but by raising the tariff as has been done on the other side of the line in the country with which we have to compete.

Topic:   WAYS AND MEANS-TARIFF COMMIS SION.
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LIB

Alexander Johnston

Liberal

Mr. ALEX. JOHNSTON.

I can quite understand why the hon. member for Centre Toronto (Mr. Broek) did not desire to have the effect of his observations spoiled by being called upon to answer a simple question. I asked to be allowed to ask him a question but the permission was refused. But, now that he has concluded his remarks perhaps he will let me put a question to him. He spoke of the iron and steel industry and of the dividends paid by the concerns engaged in that industry. He asked what those dividends were to-day. Does he know what the dividends of the Nova Scotia Steel Company, for instance- the only steel and iron concern at that time -were previous to 1896 ?

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CON

William Rees Brock

Conservative (1867-1942)

Mr. BROCK.

What has that to do with our expending 870,000,000 or $80,000,000 this year ? What do we pay duties for ? To meet the expenses of our government. If that company did not sell their goods at high enough prices to pay a dividend, that is not our fault.

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LIB

Alexander Johnston

Liberal

Mr. ALEX. JOHNSTON.

It has everything to do with the question. The hon.

gentleman (Mr. Brock) sought to create the impression that the iron and steel industry [DOT]was less prosperous to-day than it was before 1896.

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CON

William Rees Brock

Conservative (1867-1942)

Mr. BROCK.

I did not refer to 1896. I was speaking of things as they are to-day.

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LIB

Alexander Johnston

Liberal

Mr. ALEX. JOHNSTON.

If the hon. gentleman was speaking of things as they are to-day then, let me tell him that the Nova Scotia Steel and Coal Company is in a prosperous condition, whereas before 1896 it was more famous for passing dividends than for anything else.

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CON
LIB
CON

William Rees Brock

Conservative (1867-1942)

Mr. BROCK.

This government were put in to make it valuable. What have they done ?

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LIB

William Stevens Fielding (Minister of Finance and Receiver General)

Liberal

Mr. FIELDING.

I do not think it fair for the hon. member from Cape Breton (Mr. Alex. Johnston) to talk of the condition of things before 1896. No hon. gentleman on the other side likes to be reminded of that.

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CON

George William Fowler

Conservative (1867-1942)

Mr. FOWLER.

The Minister of Finance tries to give us the impression that the Nova Scotia steel industry is in a prosperous condition to-day. What is the fact ? The stock is constantly going down, it is now lower than it has been for many years. My hon. friend from Toronto was-pointing out that the country was not in as prosperous a condition as the Finance Minister would, lead us to believe from his budget speech, wherein he dwells so lovingly upon the amount of the surplus he was getting, while in the former days we were told that a surplus was wrung from the pockets of the people of this country, that it was bleeding them white. We do not hear that song to-day, but we used to hear it very often. In the election of 1900 the cry was ' Vote for Laur-ier and 11 cents cheese.' Now if we have an election this fall it will be ' Vote against Laurier and 7 cent cheese.' One cry would be just as fair as the other, because the Prime Minister has just as much to do with making cheese 7 cents a pound as he had in making it 11 cents a pound in 1900. That is what my hon. friend from Toronto was referring to ; he was pointing out that the Minister of Finance, when he makes his flainbuoyant budget speeches, does not refer to those industries that are in a languishing condition, he does not wish to present a fair statement of the facts, but he picks out a lew things here and there that are prosperous, and dwells upon them, and leaves all the others in the shade.

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LIB

William Paterson (Minister of Customs)

Liberal

Mr. PATERSON.

Don't let us get into a discussion on free trade and protection, although that will come on by and by. I think

the hon. member for Toronto (Mr. Brock), although he does not approve wholly of the dumping clause, would prefer to have that, in force than to*he without it. Our duty will be, once it is put in fdree. to perfect it as much as we can. Let me point out that the Board of Customs has not yet finally considered the machinery to be adopted, and the declarations that we will require, because we want this to pass the committee before changing our regulations. But I think the course we will pursue will be to require in the future as we have in the past, a certificate. The certificate we have required on the 'invoice hitherto has been that the man who sold the goods knew the home market price, and he had to certifiy that the goods mentioned on the invoice were charged at the prices at which they were sold in the country whence they were exported ; or if there was any difference in the price, it was noted on the margin. It is probable that we will adopt in the future a double column,, and require them to put in the one column the home price and in the other column the price at which they sell, put into the home column the price at which they sell even if it is the same. Then probably we will require the exporting firm to sign a declaration that it is a true and honest invoice, that it is without any evasion, that there is no drawback-a strong declaration. If there is any misstatement, either about the home price they put in, or in respect to anything else, then it becomes a fraudulent invoice, and the person becomes liable to penalties of the Customs Act in such case provided. I may remind the hon. gentleman what many seem to forget, that we are able to get on to these frauds at any time when thei'e have been invoices with undervaluations. Whenever we reach them, we deal with them, and they know it is a dangerous thing to engage in. Some people seem satisfied. once they have passed the customs, that they have nothing more to fear. They forget the fact that the customs can get after a fraudulent invoice for duty at any time ; even a hundred years from now we can get after them for an evasion of the law. But within three years, not beyond that, after they have passed the entry, if we discover it is fraudulent not only can we go after them for duty, but go after them for the penalties imposed by the Customs Act. The extreme penalty would be the value of the goods, and $200 for everw false entry. These penalties are so strong as to have a deterrent influence. There may be cases in which fraud is committed, but I believe that a great majority of the invoices will be honest invoices, not only because of the fact the member for Toronto mentions, but because the great bulk oft the houses he alludes to who are selling largely here, would be too honourable to make a false declaration. But those who might be lacking in that respect, will be

deterred by the penalties that will be imposed. We will do the best we can under this Act. Let us pass this measure, and we will work it out in the best way we can. If there are any amendments to be suggested, I will be glad to hear them.

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L-C

Samuel Hughes

Liberal-Conservative

Mr. SAM. HUGHES.

I brought a case before the attention of the minister some time ago, showing how this provision might be evaded. Yankee wholesale houses will establish agencies in the American centres along the border, as at Niagara Falls and Detroit, they will keep their travellers there, and ship their goods in to the retail merchants In Ontario. I know that is being done, because an instance was given to me by an American firm who had established themselves in one of these places along the line. Instead of selling to the Canadian wholesalers at the manufacturers' prices, they will wholesale the trade on the American border, and the goods will then be shipped as I have pointed out, the Canadian wholesale trade will be on the Yankee side. The price will probably be more than it was formerly, owing to the fact that they can evade this dumping clause by bringing them in under the terms I have stated. The case I cited was given to me by a gentleman who has been in the business for some weeks.

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LIB

William Paterson (Minister of Customs)

Liberal

Mr. PATERSON.

I think a clause further down will reach that.

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L-C
LIB

William Stevens Fielding (Minister of Finance and Receiver General)

Liberal

Mr. FIELDING.

I am not sure that we could overcome that by any legislation. If they are determined to cut away the middlemen and sell directly to the retailer, I doubt if any legislation can reach that.

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L-C

Samuel Hughes

Liberal-Conservative

Mr. SAM. HUGHES.

Adequate protection will meet it. If the minister will remove this extraordinary or special duty, the matter will right itself in Canada, because the retailer will get his goods at a much cheaper rate. As it is now, they add the duty on the other side, and put the wholesale cost on the other side.

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CON

Richard Blain

Conservative (1867-1942)

Mr. BLAIN.

Will the minister state what goods bear 50 per cent now.

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LIB

William Paterson (Minister of Customs)

Liberal

Mr. PATERSON.

A large class of medicines containing alcohol. No matter how small the quantity of alcohol may be in them, they are charged 50 per cent, and these articles I am told by druggists run up into the hundreds.

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August 8, 1904