March 12, 1915


Motion agreed to.


THE BUDGET.

PROPOSED WAR TAXATION.


Consideration of the proposed motion of Hon. W. T. White (Minister of Finance) for the Committee of Ways and Means, and the proposed amendment of Sir Wilfrid Laurier thereto, resumed from March 11.


CON

Robert James Ball

Conservative (1867-1942)

Mr. R. J. BALL (South Grey):

Mr. Speaker, it is with some hesitancy that I rise to say a few words on the subject of the Budget, which has now been before us for some time, especially after it has been discussed by so many able speakers who have preceded me. Before proceeding to the Budget I might refer to a few remarks of the last speaker, the hon. member for Westmorland (Mr. Copp). That hon. gentleman and others have spoken of curtailing the expenditure of the Government for this year. I take it that in the Estimates the Government have curtailed as far as possible; but owing to the war, which, of course, was an unforeseen event, they had to make altogether unusual provisions for revenue. Then there were the ordinary liabilities and necessary expenditures of the Government, some of which were really incurred by the late Government; and contracts, for which annual provision must be made, could not possibly be eliminated or curtailed. It might not have been wise for the Government to curtail or abandon contracts which they had entered into for public buildings and other improvements throughout the country under present conditions. The Government have been urging the farmers, manufacturers and others to continue their operations so as to obviate

unemployment. It seems to me that the Government itself, being the largest employer in the Dominion of Canada, should set a good example; in fact, it controls more money and can more easily obtain money than private institutions. I think that, as far as possible, in order to alleviate distress and help on the work of the country, legitimate public works ought to be gone on with.

Reference was also made to the employment of foreigners in Westmorland while our own people were out of employment. I do not know what the circumstances of that particular case were, but I know that very often contractors and others are obliged to employ foreigners to do certain classes of work that our own people refuse to do. I sometimes wonder if our people are as diligent as they should be, and if they avail themselves of all their opportunities in connection with public works and similar undertakings.

Some reference was also made to the distribution of contracts for war materials. I have not looked very closely into this matter, but, from what I can gather, the contracts for war materials have been distributed over the country amongst the various firms who manufacture such materials without any discrimination. I think the Government, under the strain to which they were subjected and being under the necessity of providing many of these things in such a hurry, were obliged, even if they had not been so disposed, to give these contracts out almost indiscriminately. I think it was wise for them to do so, because, while manufacturers may be on one side of politics or the other, they employ men of all classes and all shades of politics.

I think from a business standpoint that it would be well not to discriminate, and I believe there has not been any discrimination.

_ Something has been said of public criticism. It is well for us, even as political parties in this House, to be careful of criticism that goes out before the public. It is sometimes very hurtful. We have now before a Committee of this House an investigation into the matter of boots supplied to the soldiers. I have no doubt that when the investigation has been completed there will be very little fault to be found; yet from an international standpoint, that investigation has been very hurtful, and I have no doubt that Canadian manufacturers have suffered in consequence. The Governments of France and Russia and perhaps other countries which might have made purchases in this country will refraia- from

doing so owing to the reputation that has been given to the Canadian boot. There are many matters such as this which are international in character, in handling which we ought to be very careful and discreet. Of course, the Opposition must investigate where there are real reasons for doing so, but to my mind there have never seemed to be much cause for this investigation.

The hon. gentleman referred to the tariff as it affects his locality, that is, the province of New Brunswick. This is one broad Dominion, and it seems to me very difficult to enact a general tariff that will not strike somebody unfairly. For instance, in Ontario, and I presume in western Quebec, we have to bring bituminous coal from the other side and have had to pay a duty on it of 53 cents per ton. In addition to that there will be the 7| per cent further duty as war tax. I presume this duty is imposed in order to protect the Nova Scotia coal mines. I have heard very little complaint of that. Canada being a broad Dominion, it is very difficult to legislate for particular localities.

Reference was also made to the supposed clashing of interests between farmers and manufacturers. I was very much pleased at the remarks of the hon. member for East Huron (Mr. Bowman) last night on this subject. I see no reason why there should be any conflict or rivalry between the farmers and the manufacturers of this country. They should co-operate. In fact, in Ontario there is very little of that feeling. I believe that the farmers appreciate the advantages which they derive from the presence of manufactories in their districts, and the manufacturers appreciate the presence of the farmer. A great deal has been said on this subject by western members who seem to have a feeling of antagonism towards the manufacturers of the East. The same spirit does not prevail in Ontario, as far as I have been able to learn; we are glad to know that the West is prospering and has good prospects, and we are sorry to find any depression there. There should be mutual good will over the whole Dominion in these matters; there is no reason why one section of the people should be stirred up in antagonism towards another section of the people. The proper way for this country to prosper is on the line of co-operation. I have no doubt that before many years there will be manufacturing industries in the West. Winnipeg to-day has a great many industries, and there are industries in many of the larger towns farther west. The farmers

of the West will find the towns thus developed of great help to them.

Something was said about people, through unemployment, being almost void of the necessaries of life. If that be the case, we cannot very consistently ask the Government to withhold contracts. It would seem to me to be a time when the Government ought to proceed with public works just for that reason, namely, to help to alleviate the problem of unemployment. In many cities, as in Toronto, and I have no doubt in Ottawa, men have been employed shovelling snow and doing other work which might have been dispensed with, simply that the unemployed might be furnished with a legitimate means of livelihood. For similar reasons I think the Government ought to proceed with public works. [DOT]

Reference was made to the new war stamp. It was suggested that instead of having a war stamp, the two-cent stamp should have been made a three-cent stamp, that is, that the old domestic postalrate should have been restored.

We are living under very special conditions at the present time. There is a great European war in progress. We hope that there will never be such a war again in our time or for generations to come. I have no doubt that one of the objects of the Government is to interest the Canadian people in this war and to impress its great significance especially upon the minds of the young. The imposition of special war stamp taxes will have a great effect upon the mind of the child going to school. It will imbue him with a love for his country, and emphasise the importance and significance of the period through which we are passing.

I must congratulate- my hon friend the Minister of Finance (Mr. White) on the able manner in which he has handled this Budget. I have heard no complaints from my riding nor from any other part of the country through which I have passed in regard to the proposals which he has laid before the House. The people know that there is a war on. They have encouraged the Government to send forward troops to assist Great Britain in the war. They have sent forward their sons and are willing to assist the Government in every way possible to carry on the war. They have been expecting taxation in some way or other. Taxation by way of customs duties seems to be the most reasonable way of collecting the money that is required for this purpose. We have in existence the ordinary customs tariff. Last August a special war rate was levied through the customs tariff, and now

we have another special war rate imposed. The last special war rate affected the people generally. My hon. friend the Minister of Finance has seen fit to tax those who are best able to pay. For instance, he taxes the banks, public institutions, loan companies, insurance companies, cable and telegraph companies, and business men, in the proportion to the business they do. This seems to me to be the best way in which the taxes could be levied. The tax touches us all pro rata as nearly as can be. The farmer does not expect to be exempt from this war tax. Why should he be? The farmer is just as much interested in this war as we are. The farmer s son, the boy whom he has raised, sent to school and fitted out for life, has now gone to the front; he wants that boy to be taken care of. The only way he can be taken care of is by the Government making provision in this way, and to do this we must provide the necessary money. The labouring map does not wish to be exempt. His son has also gone to the front, and he is just as much interested in seeing that his son is properly provided for as is any other member of the community. But he is not so heavily taxed as those who are better able to pay. The levying of taxes and the paying out of their money will have a good effect even upon cnildren.

We know the cause of this war: it has been caused by one man. We cannot but wonder at the power that one man can exert over a continent and over the world. The war was caused by the inordinate lust for power and territory of the German Kaiser. This war did not spring up in a day. We have a depression, but a depression has existed the world over for some time. Two or three years ago we had the Balkan war. Europe seemed to be convulsed; in fact, we did not know where the trouble was going to break out again, whether in Europe or Asia. Finally, a couple of years ago, it broke out in the Balkans, and then the nations began to retrench financially. It takes money to carry on war, and the nations began to bemore careful of their finances.

When the Balkan war was ended this present war began to loom up. A year ago nobody had any definite idea that we would now be in the midst of war. The clouds were hovering around, the nations felt that something was going to happen, and in order to provide for whatever might happen England, as well as our own Government, began to retrench. England began to draw in her sails in the matter of finance. Imme-

diately after the war broke out Canadian and other loans became more difficult to negotiate in Great Britain. Great Britain husbanded her finances in order that she might be able to take care of her national interests. We are pleased to know that she has also taken this colony of hers, Canada, under her wing, and has assisted her in the difficult task of financing. We are glad to know that we are able to finance under such favourable conditions. Most of the nations of Europe are involved in this war. We have Germany, Austria and Turkey on one side, and Great Britain, Russia, France, Belgium, Japan, and the British colonies on the other. This brings the matter home to us in a very decided way. Canada is inhabited by people of many nations. We have people of English, Irish, Scotch, German, French, Austrian and other nationalities. Perhaps we are too much given to sectionalism and to the perpetuation of national distinctions. I like the word "Canadian " better than any other, and I think that the sooner we realize that we are all Canadians the better it will be for this country of ours. In western Canada we have a great many German people. Many of these people are in my own riding. They find themselves in a very difficult position at the present time. Many of them have their brothers and friends fighting in the war against Britain. These people are endeavouring to be, and I believe are, loyal to the Crown under which they live. We can understand their difficulty. They are deserving of our sympathy, and we ought to be careful not to estrange such German citizens at this time. In my own riding they are an industrious, law-abiding, thrifty and loyal people. Many of them, no doubt, coming direct from the fatherland, have a love and affection for that land while loyal to the country they live in. In a generation or two this feeling will pass away, and we shall all become one people.

A year or two ago there was much talk of an emergency. There must have been an emergency at that time, as this war has broken out so suddenly. Germany had been preparing for the war. The Kaiser probably has been preparing for the last twenty-five years or more, and therefore it was up to the rest of the nations of Europe to see that they also were prepared. We had considerable discussion here about dreadnoughts and naval preparations for war a couple of years ago. I have no doubt that the British Government at that time realized the

danger, and it may be that some members of this Government had some hint as to the danger that was then in the air. It would have been very gratifying to us now if some of our dreadnoughts had been in the fighting line.

At the present time trade and financial depression extend throughout every country in the world, and it is for the Canadian Government to help business along and to carry out all the contracts which the country has entered into, so as to encourage the people and help them to struggle along until the hard times have passed. The industries which are turning out war materials do not perhaps feel the depression so keenly, but factories that are making what might be more or less called luxuries are undoubtedly adversely affected by the war. In my own town of Hanover we find that the war affects us greatly Our town was in good shape before this appalling war broke out, but since then business has become more or less stagnant, and the same remark would apply to Berlin, Stratford, and other towns in which the furniture industry is carried on. The Government has been very liberal with our banks, and I think that the banks in turn should assist business men who are legitimately entitled to advances, and in cases where the security is perfectly good. It seems to me that the banks could do a great deal in the way of helping business until the war is over and there is a recovery.

The farmeis of Canada are no doubt in a prosperous condition, and we are all glad to know it, because nobody envies the farmer all he can get out of his industry. Perhaps the best way to draw people to the land is to develop agricultural education, and the present Government has done a great deal in that direction. I believe also that the education in the public schools should be more directed along the lines of teaching agriculture, for it is a regrettable fact that up to the present our young people have been trained more for professions and other occupations which take them away from the land. The inauguration of rural mail delivery and the parcel post by the Government, as well as the establishment of rural telephones and the development of electricity during late years, all bring the comforts of urban life to the rural population and tend to induce people to cultivate the land and to stay on the farm.

We have had during late years a good deal of trouble over labour matters in this

as in other countries; but now that there is a wave ot industrial depression, conditions have become better in this respect.

It seems to me that we are inclined to legislate too much, in Canada as elsewhere, for the settlement of labour disputes. In my opinion the better way to settle such disputes is to let the individual employer and the individual workman negotiate between themselves. In my own town we have never had labour organizations, and we have never had strikes of any kind; our thrifty working-people for the most part own their own homes; and harmony prevails among all classes of the community. I have already spoken of the concord which should exist between the farmer and the manufacturer and other business men in the community.

The action taken by the Government to give seed grain to the farmers of the West has, I think, met with the approval of all classes. There have been 48,630 applications received for seed grain, which will supply 3,473,456 acres, requiring 6,000,000 bushels of wheat and oats. I believe that the Government Is treating the West very generously in this respect, and I am glad that the farmers of the West will be helped thereby. The Ontario Government is providing for its own people; Manitoba and the eastern, provinces are doing the same; but in the prairie provinces, Manitoba excepted, it is the Dominion Government which has taken action, and we trust it may be successful in relieving the situation there. I believe that this Government deserves a great deal of credit for the manner in which it has conducted the affairs of Canada since it came to office, and I congratulate the Minister of Finance upon his Budget, which I believe to be as fair and equitable as it possibly could be. I think it bears equitably on all, and I have no doubt that all the people of Canada are willing to contribute to the expenses of this war. I believe that the Budget has so arranged things that all

classes will contribute in proportion

' to their ability to pay, and thatthe policy of the Government in

this respect will be endorsed by the electorate. In my own riding, so far as I have been able to learn, the people are at one in endorsing the course taken by the Government to provide means to enable Canada to bear her share in this terrible war.

Mr. D. B. NEELY (Humboldt): Mr. Speaker, I have listened with some degree of interest to the remarks of my hon. friend

from South Grey (Mr. Ball), and I must express my regret that I cannot agree with a number of his conclusions. The hon. gentleman, and other hon. gentlemen on the Government side, seem to view with very great complacency the tariff proposals we are now considering. I can quite understand that the mental attitude of the hon. gentleman might be influenced to some extent by the fact that his livelihood is gained in an industry which certainly will benefit largely by the proposals in this Budget. My hon. friend deprecates the idea of putting class against class, the manufacturer against the farmer and the farmer against the manufacturer, and I quite agree with him that there should be the best possible relationship between all elements of our citizenship. I agree with him also when he says that the farmers appreciate the presence of the manufacturers in this country; and I agree with him when he says that the manufacturers appreciate the farmers.

I should say they do, and they will appreciate them a great deal more when these tariff proposals have become law. My hon. friend, who is a practical business man, comes to the defence of the Government when he says we must not blame their policy for the widespread depression that exists in commercial and financial affairs throughout Canada.

I must differ sharply with my hon. friend in his conclusions, for, in my judgment, the policy of this Government since it came into office has had a great deal to do with the financial and commercial depression that exists in Canada to-day. This Government came into power on a policy which, if it meant anything at all, meant restriction of trade to the Dominion. If a policy of restriction of trade has not for its logical conclusion commercial depression and unemployment, then I understand nothing of the principles of political economy.

The defeat of the trade agreement of 1911, brought about iby the protectionist arguments of hon. gentlemen who now occupy the Government benches, is and must be considered largely responsible for the present commercial depression. In the first place, it was a great blow to production in this country, in that the great community engaged in the industry of agriculture, which is the foundation of Canada's prosperity, was .prevented from obtaining, on terms of absolute preference, what in my judgment and in the judgment of the great

*majority of my constituents "was the best possible market in the civilized world.

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LIB

William Cameron Edwards

Liberal

Mr. EDWARDS:

Would the defeat of reciprocity account also for the depression in the United States at the present time?

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LIB

David Bradley Neely

Liberal

Mr. NEELY:

My hon. friend will have to demonstrate first of all that the premises on which his question is based are sound, and that there' is a condition of financial depression in the United States similar or equal to that in Canada.

The defeat of the trade agreement of 1911 was also a severe blow to production in this country, in that it meant the stemming of the tide of that class of immigration which is largely responsible for much of the development and prosperity of Canada in recent years. Take the best class of immigration that we have in Canada to-day, in western Canada particularly-I say the best class, because the immigrants come to us not only with money but with equipment and .with experience that is worth more than money-the class of American farmers who for years past have been flocking into Canada from the farming states to the south. The defeat of the trade agreement of 1911 did more to stem that tide of immigration than anything else that has ever occurred in Canada's history. Since 1911, there has been a great falling- off in this class of immigration, to the great loss not only of the people of western Canada, but of the people of every part of the Dominion.

What does this Government stand for in the matter of its trade policy? My hon. friend the Minister of Finance is exceedingly sensitive about criticism or question of motive as to why the present tariff legislation has been brought before the House and the country. I say in all sincerity that no matter that could be brought forward by the Government having for its object the paying of our proper Bills-the

5 p.m. paying of Canada's share in the successful prosecution of the great struggle in which, the Empire is engaged-would meet with one word of criticism from any hon. member on this side of the House; but 1 strenuously object to the people of Canada and hon. members of this House being asked to vote for proposals labelled as war-tax proposals, when the Minister of Finance himself admits that the objects of this legislation are not to pay the expenses of the war. That statement, made in the first Budget deliver-

ance of this session by the Minister of Finance, cannot be mistaken. He says in the clearest language that every dollar of Canada's share of the expense of this war is to be obtained from the Government of Great Britain, and that this extra tax is to meet that great gap, which he sees before him, between the current revenue and the current expenditure, outside of the expenses of the war.

My hon. friend the Minister of Finance takes criticism of his proposals almost as personal criticism of himself. It is a well-known fact that all egotists are thinskinned ; and when I point to the fact, which was abundantly demonstrated in the three-hour speech of tne Minister of Finance the other night, namely, that he appears to assume the whole responsibility of the financial situation of Canada at the present time, one can quite understand how criticism would be exceedingly unwelcome to one who has such a high valuation of his own abilities.

It took only a matter of a few minutes to run over the speech of the Minister of Finance the other night, and count the number of times the Finance Minister had actually used the first personal pronoun. I could hardly believe the result myself when I was told that he used it no less than 435 times, and that exclusive of references made by the hon. gentleman to himself as " me " or " my." That would he an average of about 145 times an hour, or about two and a half times a minute. Sir, we have been accustomed to regard the Emperor of Germany as the greatest egotist in the world, but even he is more moderate than my hon. friend. The Emperor of Germany takes a partner with him, for his expression as reported to us is " Me und Gott." But my hon. friend the Minister of Fin- -ance does not share responsibility or honour with anybody; he takes it all himself. He assumes the most injured air towards members of the Opposition because they dare to question the express object for which these tariff proposals are brought down. Although the Minister of Finance holds a much more important place in this House and in this country than I do as a private member of this House, I would counsel him to cultivate a spirit of stolid indifference to criticism, for I believe it would make him a more useful member of this House and a better minister and member of the Government. If he is thinskinned about criticism, I am not, and I propose therefore to inquire, as best I can, into the underlying motive or principle

that actuated these proposals now under consideration.

I disagree with the hon. member for South Grey (Mr. Ball) and with the Finance Minister when they say that this Government are not to blame for a large part of the depression that exists in Canada to-day. Let me ask the Minister of Finance what was the condition of Canada's trade before the outbreak of war in August, 1914? What was the condition as to our imports? My hon. friend from Red Deer (Mr. Michael Clark) put that question to the Minister of Finance the other nightand he did not get an answer. That question has not been answered, and it is not capable of being answered by the Minister of Finance. My hon. friend from Red Deer pointed out that while in the United States and Australia, for months preceding the war, 'imports were on the increase; in the case of Canada, for months preceding the war, there was a constant falling off of imports. What had the war to do with that situation?

In that connection, let me point out to the House that these tariff changes are not the first that have'been brought before this House for the replenishing of a falling revenue. We had a Budget speech about a year ago, in which the Minister of Finance increased the tariff and put new taxes on a very considerable list of articles consumed by the people of Canada. There was no war in April, 1914; and I presume that when these increases in the tariff were made, the object .was, as my hon. friend says the object is in the present case, to increase the revenues of the country. Well, let us be frank, and I am going to be frank when I say, notwithstanding the somewhat theatrical statement of the Minister of Finance when he said: "I refuse to vindicate myself; I refuse to answer this imputation against my motives in bringing down these tariff proposals"-that, in my judgment, we have every reason to come to the conclusion that these tariff proposals of the present Budget are just one further step in the carrying out of a definite and settled policy of this Government, which policy they had in their minds when they took office. Since this Government took office we have been given every reason to come to that conclusion. We found this Government tampering with the regulations under which our tariff was administered with reference to certain articles. Take, for instance, the item that means so much to the people of Western Canada, and more or less to all of Canada, the item of lumber, and what did this Government do with reference to that, very 61

shortly after they came into office? Whereas certain classes of rough lumber had been allowed to come into this country free, on the advice, apparently, of members of this Government, a new decision was arrived at by the Board of Customs, and this lumber was declared to be dutiable at $2 a thousand feet extra. Nothing saved us from that extra burden hut the decision of the Supreme Court of Canada, which decision was to the effect that this class of lumber was not dutiable under the statute. But for that decision the people of Canada would have been bearing that extra burden. That is one of a number of such instances. The legislation with regard to the importation of fruit was an instance; the legislation with regard to the importation of fertilizers was another instance. These things, followed up as they were by the legislation of 1914, the tariff changes of last year, I contend, give us every reason to believe that in the proposals now before the House, the Government are simply carrying out a policy which they had laid down for themselves, or which their friends had laid down for them, when they came into office in 1911.

Previous to August, 1914, no war was taking place, yet conditions in Canada were very bad; export trade and revenues were falling off. When the minister made his Budget speech at the last regular session of Parliament, he did not, any more than the humblest member of this House, foresee the conditions of war which now prevail. Yet in view of the falling off of imports and, consequently, of revenue, did not the hon. gentleman foresee that at this session of Parliament the legislation which we are now considering would be introduced? Did he not foresee a deficit, aside altogether from the conditions created by the war? My hon. friend does not answer; perhaps he will later. When he is answering that question, I should like him to answer another. If the taxes that he now proposes to impose upon the people of Canada are, as he calls them, genuine war taxes, what will become of them when the dreadful conflict which is now in progress is brought to a conclusion? If these are war taxes, I presume that they will cease when the war is over. Will the Finance Minister be good' enough to tell the House at some future time, if not at the present moment, whether or not these proposed enactments will be wiped off the statute books when the war is over and Canada's trade resumes something like a normal condition? I think that is a fair question to ask the hon. gentleman, in view of the fact that

he so earnestly desires this. House to look upon these tariff measures as war taxes to pay for 'Canada's participation in the war.

I question the expressed object of this legislation, namely, that it is for the purpose of raising a larger revenue to meet the extraordinary expenses incurred by Canada in connection with the war. If this tariff increase were put on expressly for the purpose of raising a revenue, in my judgment that increase would consist not of a flat increase in the duties on all imports coming into the country, hut of a tariff rate graduated to meet the conditions prevailing in respect of each of the various classes of imports proposed to be taxed. We are asked to approve an increase of 7J percent on practically every class of goods entering into Canada from foreign countries, and an increase of five per

cant as against goods coming Into Canada from Great Britain. This method of dealing with the tariff does not seem to be consistent with the principle that the imposition of tariffs is a scientific method of obtaining a revenue. Nothing so surely refutes the Finance Minister's contention that these tariff increases axe intended merely to raise a revenue to meet war expenses, than the very manner in which they are made. The hon. gentleman should know that some articles coming into this country will stand a higher rate of duty than others; this is particularly applicable to articles that are not produced in Canada. What will be the logical result of this unscientific method of raising revenue? The Finance Minister says that his proposals are made for the purpose of creating a revenue. Granted. But if these tariffs do not bring about the desired revenue; if they fall short of the object which it is proposed they shall accomplish, what then? My hon. friend the Minister of Finance said the other night: I see my way through this very difficult financial situation; I saw my way through it last August, and I see my way through it now. If the hon. member has such clarity of vision, no doubt he will be able to tell the House and the country what kind of proposals he will bring down to the House if his present tariff proposals do not produce the desired revenue-that is, if it is the will of Proviuence that he have the privilege of presenting another Budget to this House. A great many articles coming into Canada will now be taxed as high as 42i per cent; yet we have absolutely no ground for believing that this new tariff legislation is going to produce the additional

revenue that the Minister of Finance desires. If it does not, what shall we do next? Shall we have another 7J per cent general increase and another 5, 10 or 15 per cent increase in the British preferential rate? To what follies would the protectionists lead the people if they had their way without let or hindrance, and were able to carry out their policy to its logical conclusion? In my opinion, the logical result of their policy would be in the creation of a tariff wall so high that no imports could come into Canada to compete with similar articles manufactured or produced in this country.

We on this side of the House regret the necessity of differing with the hon. minister and of questioning his motives, but we doubt whether it is really intended that these tariff proposals will increase the revenues of this country.

But whatever other effect they will have they will certainly and surely increase the cost of living to every consumer in this country. I can give a few very practical illustrations of what an increase in the tariff means to consumers in this country. My hon. friend last year was good enough to place a duty of $4 a ton on wire rods coming into Canada, these having formerly come in free. What was the effect of this increased duty ? We were led at that time to believe that this would not result in any greater price being paid by the consumer for the finished products from those wire rods. Why, Sir, it was not a month after the coming into effect of that legislation before every farmer and every artisan in this country who wanted to buy a keg of nails had to pay 25 cents to 50 cents a keg more for the nails which they purchased. I had the privilege a couple of months ago of attending a farmers' meeting in my constituency, called for the purpose of organizing a rural telephone system. This system was to run out some 20 or 25 miles to a settlement of people who lived that far from a railroad -and I regret to say that I have many people in my district who live even farther than that from the nearest market town. These people proposed to have a farmers' rural telephone line which, with its branches into the residences en route, would probably amount in five years time to a total installation of 40 miles of telephone line. When they came to investigate the cost of building that line it was found that for every mile of telephone wire used those farmers would have to pay from $5 to $7 more because of the additional

adian people is so honest and sincere that when it comes to a Question of choice as between Canadian made goods and goods made in a foreign country, if the quality is equal and the pnce the same, they will buy the goods that are madfe in their own country. But if the Minister of Finance wanted to buy a new automobile for himself, or nis department, and if he could get a better machine at a lower price in the United States than he could get in Canada, I question whether he or any other member of the House would consider very seriously this propaganda of "anade-in-C'an-ada." Of course, we want to see the industries of this country develop and-flour-ish, but we cannot consent to their flourishing solely and entirely at the expense, and at the loss, of the great mass of the consumers of the country. If you carry the principle of this made-in-Canada propaganda to its logical conclusion, where do you arrive? We put an extra tariff in order to increase the revenue and in the very same breath we are educating the people through the Budget of the Finance Minister to use goods that are made in Canada. If you are going to use only goods that are made in Canada, in the name of common sense, how is this new tariff going to produce an increased revenue? If we are going to get a revenue from the tariff it must be because we import foreign-made goods and if we use exclusively goods made in Canada then my hon. friend's proposals will be a dead letter on the statute books. You cannot eat your cake and have it too. You cannot carry out this propaganda to its logical conclusion and expect increased revenues from the customs tariff on goods coming into the country.

As far as the manufacturers are concerned I fail to see why, at this crisis in our country's history, they should have required this special legislation. For over forty years Canada has had a protective tariff. Even under the late Administration there was a very large element of protection in the tariff. We have had a protective tariff and certain industries, many of whose representatives sit on the opposite side of the House, have enjoyed the benefit of that protection. For what purpose and to what end? For what purpose if not for the purpose that when Canada would be passing through just such a financial and commercial crisis as that which confronts it at the present moment, these men, these industries that have been built up under forty years of protection and special consideration,

should be able to bear the brunt of the sacri * fices that Canada would have to make to meet the situation. But what do we find to-day? We find our manufacturers receiving the benefit of millions of dollars worth of special orders from the allied nations who are at war. They have the additional advantage that the war itself has cut off the foreign exports of qne of the greatest manufacturing countries in the world, namely, Germany, and the manufacturers of Canada have the opportunity of a lifetime at the present moment, because if they wanted to .reach out their hands they could lay hold of a large share of Germany's and Austria's foreign export trade.

The protected interests that have been taken care of since Canada was brought into Confederation, ought to be saying to the Government and to the people of Canada: You have given us special consideration for the last forty years, you have protected us from foreign imports by the tariff, we have built up flourishing industries, we have made money, we have succeeded and to-day we come to the defence of our Government, of our country, of our Empire by offering up the money which we have made out of the special privileges and benefits we have obtained under protection in the last forty yeaffs, but instead of that we find them coming to the Government and asking for further protection of 71 and 5 per cent. I feel deeply on this question because I know that every man, woman and child in this country is going to feel the pinch of this legislation in the very near futurS and that the people are going to feel it, Sir, where it touches them most-in the things that they put upon their tables and that they put upon their backs.

My hon. friend the Minister of Finance sees no light in any of the suggestions that have been offered from this side of the House as to any other method by which larger revenues might be obtained to meet the extra burden of the present situation. I would like to call his attention to a little item that appeared in the Ottawa Evening Journal on Monday, March 8, in the form of the following despatch:

London, March 8.-A despatch from Berne, Switzerland, says: A Bill has been submitted

to the German Reichstag imposing a special tax on the profits of manufacturers of war materials. The tax is retroactive and the commissioners already are obtaining returns from all firms which have been supplying the army and navy since August last.

There is some initiative on the part of a country whose fiscal policy seems to be so

much admired by this present Government. I recommend this method of obtaining revenue to the Minister of Finance. The income tax and the land tax he throws aside as broken reeds. Perhaps, following the example of Germany, if he will go over some of the contracts let iiy the Canadian Government during the last six months, he will be able to find a margin of profit to the manufacturers of these supplies, which might very well be divided up with the treasury of the country and still leave a very handsome profit to the contractors.

These are some of the objections we nave to the proposal in this Budget as to a 7i per cent increase on goods coming in from other countries. But let me say that while we object to this horizontal increase of 7i per cent, because we do not on this side of the House believe it will bring about the desired results, because it will go largely into the pockets of the manufacturers and not into the treasury of the country; in all sincerity I say we might possibly try out this further tariff experiment, were it not for the fact that the Government has added this-I would not care to, use the words that come to me to describe it-most reprehensible proposal to increase the preferential rate on goods coming from the Mother Country.

What is the situation which Canada and the Empire are confronted with? The Minister of Finance threw a very serious charge against members on this side of the House the other night, when he said that in his judgment there was not apparently among us a proper realization of the great gravity of the present struggle in Europe. Sir, it is because we Liberals do appreciate the gravity of that situation that we now propose to vote against increased obstacles to British trade, through the addition of an extra tariff of 5 per cent on British goods. Let it be distinctly understood that we do not do this in a challenge to the Government; we are not doing it with the idea of throwing down the gauntlet or placing a chip on our shoulder, because let me tell hon. gentlemen opposite that if they want to take this issue and this vote as a reason for an appeal to the people of this country, they will have to do it on their own responsibility. We on this side of the House will not share that responsibility. We refuse to share it, because when we did agree, as we did agree last August, to aid this Government in every possible way to carry on successfully Canada's part in the war, we did not agree at that time or at any time since, to conform our views to the present

proposal of the Government, that we can best play Canada's part by placing obstacles in the way of Britain's trade. Look at the present situation! The Minister of Finance says that this increased tariff against British goods really gives the British manufacturer a further preference in our markets over his competitors from other countries. The plain fact is that this increase in the tariff means another five dollars on every hundred dollars' worth of British goods coming into this country and that at a time when Britain's trade is staggering under a load which that trade has never before been called upon to bear. I sincerely and honestly say, that in my judgment this tariff proposal is the most severe blow at Britain's trade which she has received since the outbreak of the present struggle. What are the conditions? Britain is a great exporting country; her trade with Germany is cut off, her trade with Austria and Turkey is cut off, her trade with all foreign countries is necessarily hampered by the lack of transport, by the scarcity of labour, by higher ocean freight rates, and by the high cost of marine insurance. I should not be surprised had I the figures at hand, to find that the extra freight rates on account of the greater risk of war meant an additional obstacle of five or ten per cent in the way of Britain's exporting goods to Canada. Labouring under these obstacles at the present moment, and at the same time reaching out a helping hand to every one of her colonies that need her financial assistance, Canada, Australia, New Zealand, as well as to the weaker of the allied countries, Belgium and Servia; with this enormous burden upon her shoulders, and with the solution of the war based upon Britain's financial stability and strength, the foundation of which is her export trade to the other countries of the world, I say, Mr. Speaker, that we are striking at the very heart of Britain's strength when we undertake to put this extra obstacle against the importation of British goods to Canada.

The Minister of Finance replied to my right hon. leader in the the old familiar way, when he said that the enormous expenditures and terrible burdens of this country which he, as Finance Minister, had to meet, were the consequence of the policy of the preceding Administration, and he pointed particularly to our large expenditure in recent years on transportation facilities. That argument is our old familiar friend, but what are the facts? We know perfectly well that for the expenditure on the Hudson

Bay railway the leader of the Government must assume just as much responsibility as the leader of the Opposition, because preceding the last election the leader of this Government pledged himself to the people of Cahada that if he were returned to power he would build the Hudson Bay railway; and as an hon. friend reminds me, he said that he would build it much faster than the Liberal Administration would.

Let us take the case of the National Transcontinental railway. It is too late to discuss the question of the advisability of building that railway. The people of Canada decided that question in the election of 1904, and they decided it very largely in its favour. When my hon. friend the Minister of Finance brings back those stale arguments about what the original cost was supposed to be and what the road actually cost, he knows from his own experience, since he has been a member of this Government, that many things cost a great deal more than one originally expects them to do. What, for example, about that public building, almost within sight of Parliament? When the Government is through paying for it, it will find that that building will cost a great deal more than was originally anticipated. This Government paid out over $100,000-1 think I am correct in the figure-to a couple of gentlemen, partisan friends, who spent over a year in investigating every contract in connection with the construction of the National Transcontinental railway, from one end to the other. What conclusion did they arrive at? Every hon. gentleman opposite knows that, before that report was brought into this House, rumours were spread broadcast throughout the country as to what great scandals were forthcoming against the late Administration. Since that report has been brought down and discussed here, scarcely a reputable Tory newspaper has dared to print a single line or to make a single reference to it.

At six o'clock, the House took recess.

The House resumed at eight o'clock.

Topic:   THE BUDGET.
Subtopic:   PROPOSED WAR TAXATION.
Permalink

PRIVATE BILLS.

CONSIDERED IN COMMITTEE-THIRD READINGS.


The House in Committee on Private Bills, Mr. Sevigny in the Chair. Bill No. 52, respecting the Montreal, Ottawa and Georgian Bay Canal Company- Mr. G. V. White-in committee. On section 1-extension of time for completion :


LIB

George Perry Graham

Liberal

Mr. GRAHAM:

This went through the Railway Committee, did it?

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink
CON

Edward Arthur Lancaster

Conservative (1867-1942)

Mr. LANCASTER:

Yes. This is in exactly the same terms as the Bill of two years ago, with the same provision for the protection of the Government as to damages.

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink
LIB

Edward Walter Nesbitt

Liberal

Mr. NESBITT:

What extension of time is allowed?

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink
CON

Edward Arthur Lancaster

Conservative (1867-1942)

Mr. LANCASTER:

Three years to commence and nine to complete. We do not have the same rules with regard to canals as to railways.

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink
LIB

Edward Walter Nesbitt

Liberal

Mr. NESBITT:

Under certain circumstances we have the right to take it over?

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink
CON

Edward Arthur Lancaster

Conservative (1867-1942)

Mr. LANCASTER:

Yes. And if the Government take it over they pay only limited

species of damages.

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink
LIB

George Perry Graham

Liberal

Mr. GRAHAM:

Has the Government any policy to announce on the Georgian Bay canal?

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink
CON

William Thomas White (Minister of Finance and Receiver General)

Conservative (1867-1942)

Hon. W. T. WHITE:

This is hardly an

opportune time to discuss the general question. The Minister of Public Works (Mr. Rogers) is not present. I understand that the policy of the hon. gentleman (Mt. Graham) is to stop all public works.

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink
LIB
CON

William Thomas White (Minister of Finance and Receiver General)

Conservative (1867-1942)

Mr. WHITE:

That is the view expressed by many of his associates. The policy of the Government, as announced in the Budget speech, is that we are not proceeding with new works until the sources from which the expenditure is to be defrayed are apparent.

Topic:   PRIVATE BILLS.
Subtopic:   CONSIDERED IN COMMITTEE-THIRD READINGS.
Permalink

March 12, 1915