So you say.
I had the honour of making a political tour with the Prime Minister through the beautiful Eastern Townships. He was enthusiastically received by huge crowds of people in every town he visited, including the city of Sherbrooke. Not only that, but the French-Canadian mayors of the various towns visited, in accordance with the customary
courtesy of the French people, not only gave him a most enthusiastic welcome but, everywhere he went, presented him with illuminated addresses in both English and French. In the drill hall in the city of Sherbrooke the Prime Minister was welcomed by a crowd of something like 7,000 people-the building was packed to the doors. Leaving that city and coming to my own city of Montreal a banquet was there tendered to the Prime Minister by the citizens generally of that commercial metropolis, and not by the members of any political party. Over 700 people crowded into the banqueting hall on that occasion, there was not even standing room left, and it was most gratifying to the Prime Minister and myself that the large majority of those in attendance were of the French-Canadian race. What does that mean? That means that any unfortunate feeling that may have been created during the stress of war has passed away. In the province of Quebec there are, of course, large numbers of Conservatives. The people of Quebec are a protectionist people, they do not believe in free trade, they do not believe in increasing the British preference to fifty per cent. They are intensely interested in stable government. They have a distinct leaning towards the party in power that stands for the policy of moderate protection; and difficult as the task may be in that province I can say, in all friendliness to my hon. friends opposite, that when the next general election is over there will be no repetition of the results of 1917-that out of 65 seats 62 Liberals were elected and only 3 members on this side of the House.
Let us have an election, then.
My hon. friend
from Chambly-Vercheres will get an election in due time, and when that election is over there will be very much larger representation of good French Canadians from the province of Quebec on this side of the House than there is at the present time. To use the words of the hon. member for Red Deer my hon. friends opposite from the province of Quebec are something like Admiral Nelson-they always put -the glass to the blind eye. They fraternize one with the other and can see nothing but victory ahead for themselves-they can see nothing but the maintenance of this "Quebec bloc." One of the sheep has jumped over the walls of the pen and is wandering loose at the present time; in
spite of that however they are confident they can maintain the "Quebec bloc." As to that let me quote from the greatest French Canadian paper in the province of Quebec, a journal that is published and printed in my own city, La Presse.
What was the
price of the sale?
I am very much
gratified to hear the derisive remarks that now come from hon. gentlemen opposite. For years and years nothing they could say was too good for La Presse. They now think we have bought that paper.
Let me say to
my hon. friends that such has not occurred. No influence, direct, or indirect has been brought to bear upon La Presse. On the contrary the astute proprietor of that journal sees the unfortunate condition of the province of Quiebec resulting from the maintenance of the policy of stupid isolation that my hon. friends opposite would like to see maintained, and so La Presse, with a daily circulation of over
140,000, represents the true expression of opinion of the French Canadian people in the province of Quebec.
I will not read the whole of the editorial to which I have reference. Doubtless, as my hon. friends opposite used to take such great pleasure in reading La Presse in the fighting times when it was standing up for the Liberal party, I am sure they would like me to read the whole of the editorial. Now this is what La Presse says:
In view of these facts there can he but one logical conclusion :
Let us preserve an economic regime which has proved itself so splendidly beneficial, and let us continue protection which is the basis of that regime.
"La Presse" which, ever since its foundation, has never ceased to be the convinced and determined champion of the principle of protection, in the presence of such evident confirmation of the justness of its attitude, remains more than ever convinced that it is essential for the future of Canada to maintain this principle of protection as the basis of our tariff policy.
It is not at this time, when, owing to the universal upheaval caused by the war in the economic field, any error may have disastrous consequences for Canada, that one can reasonably think of abandoning a principle which offers such guarantees for the future. Let us not abandon realities for dreams.
Those opinions are the opinions of the majority of the people from the province from which I come-
-and I want to say to hon. members who come from other parts of Canada that I am glad of this opportunity to exhibit to them this other picture from the province of Quebec, and to tell them something about Quebec which hon. members opposite would not deem it to be in their best interests to tell.
What was the date of
the article from which the minister quoted?
I can give that, I have it here.
Read it in French.
Mr- BALLANTYNE: I can do that, too, if the hon. member wishes. The date of the issue of La Presse in which that editorial appeared was January 29, 1921.
In conclusion, Mr. Speaker, I have only to state that I shall certainly register my vote against the milk-and-water amendment that has been moved by the hon. member for Shelburne and Queen's (Mr. Fielding), and I am sure all my colleagues will have very great pleasure in also voting against it. Let me repeat, the party to your right, Sir, has a clearly defined fiscal policy of moderate protection. And I hope that hon. gentlemen opposite will tell the House that they stand behind their leader and will support the fiscal policy on which he was elected.
Mr. MICHAEL CLARK (Red Deer) :
attitude upon that question. He understands the economics of the question just as well as I do, and I cannot understand his position when at one time he mourns thp excess of American imports and at another time says that we must have the foreign capital, which can only come into this country in the form of the imports which he mourns.
Well, what is the problem with which the nation is confronted at the present time? Briefly it is this: that after what my hon. friends opposite assert to have been well on to half a century of the so-called National Policy, in a country of unparalleled resources in extent and value, with only three people to the square mile, we are face to face with a national debt of $2,350,000,-000-largely due to the war, let me admit with the utmost frankness; it need not have been so big if the previous Finance Minister had taxed as my hon. friend is doing, but it is largely owing to the war, nevertheless;-we have a national railway system which showed a deficit of $70,000,000 last year; we have what I am afraid is an utterly unprofitable and losing mercantile marine which has swallowed millions upon millions of the money of the people of this country; our cities are crowded with unemployed, and they are most numerous in Montreal, Vancouver and Toronto, where the shipbuilding escapades of the Government were undertaken to cure unemployment; farm products have already declined to a non-paying basis; and our foreign commerce at the moment as well as our internal trade is declining at an alarming rate. That is the condition of the country, and it is a condition that should give all thoughtful citizens pause. But there is no pause to the Government, for their cure is "more National Policy," as I shall show in a minute. Well, on the ground of ordinary common sense, I should say that if a patient has had a certain treatment for forty-three years and at the end of that period shows this lamentable condition according to the statement of hon. gentlemen opposite, the country would be well advised in doing what I am quite sure it is going to do at the first opportunity-try a change of doctor and a change of medicine. I repeat that the prescription of hon. gentlemen opposite for this condition is more National Policy. It is true that ostensibly the Budget presents but few tariff changes. We are told that this is no time for a tariff revision. My right hon. friend the Minister of Trade and Commerce (Sir George Foster) laboured this
point very hard yesterday. I must confess that I could not see very much in the reasons he urged for this action. A simple answer to all he said would be: If it be not an afterthought to state that the tariff is not being revised because of the unstable conditions the world over, why did you have a tariff commission going from the Atlantic to the Pacific last year?-why the waste of money? If there was to be no tariff revision there surely should not have been a tariff commission last year. That is a simple answer, and I am very much afraid that the failure to revise the tariff at this session would get a truer, as it certainly would get a better, defence if my hon. friends based it not on the instability of conditions throughout the world but on the well-recognized instability of the Government and its majority.
But is it true that we have no revision? Mr. Speaker, I think not. The Budget gives a revision of the tariff, and a very serious revision upwards. In the first place, what does the one per cent extra on all imports amount to but a raising of the tariff? It is the same operation; call it what you like, it is an increase of the import duties on goods coming into the country, and on almost all goods. There are exceptions, but it relegates quite a large number of articles to the past, as regards the free list. It is an immense increase of the tariff burdens of the people of this country. In the second place, for all practical purposes, the revision, in accordance with exchange rates, in the method of collecting of duties is also a very substantial revision of the tariff upwards. Therefore, it is not a fact to say that we have no revision of the tariff in this Budget, we have a great increase of the tariff. Whether you call these taxes tariff or sales taxes, what the people of this country are concerned to know is the real nature of these taxes and their effect upon the national disease, as I call it, which I venture to describe to this House in simple terms which no one can contradict. Whatever we may call the taxes upon which my hon. friend relies largely for his revenue, they are all taxes upon consumable commodities used by the people in this country. Let there be no mistake about that; that whether they are what are commonly called tariffs, or an increase of import sales taxes, or sales taxes imposed upon goods manufactured in the country, they are all of them taxes upon consumable commodities.
I think that a fourth-form school boy cannot fail to follow the simple process of reasoning by which the inevitable and undoubted elfect of these taxes can be worked out. What is the effect of taxes upon consumable commodities? Its first and immediate effect is to raise the price of the commodity. But if it raises the price, what must of necessity be its next effect? Supposing the article in question to be a suit of clothes; supposing that before these taxes are imposed, the money that any given consumer has to spend on suits of clothes is $100-that that is what his personal Budget will allow him to spend upon clothes. If clothes could be bought for $33 a suit, clearly he could buy three suits with the $100; but if the price were by any chance raised to $50, and he had only $100 to spend upon suits, just as clearly he could buy only two suits. Therefore, the first effect of a tax upon consumable commodities for people of limited income-and that means the vast majority of the people of this country-is to increase the price; and the second, inevitably, is to limit the consumption. These are the elements of political economy which have been taught by these supposedly "obsolete" teachers for at least a century and a half. What follows inevitably on decreased consumption is decreased production. Increase the price of the consumable commodity and you decrease the consumption; decrease the consumption and you decrease the production; and if you decrease the production, you lessen the work of the workmen of the country, you increase unemployment. That is what my hon. friend confessed, in the middle of the fiscal year, that his taxes of a year ago did; it was what he was told at the time they would do, and to that extent the Government of the day in this country, where our economic problem is so simple, are, on account of their fiscal policy, as responsible for a large measure of unemployment as if they had ordered a lockout of the workmen. That is the nature of all these taxes, and that is the method of their operation.
I want to go a little further in my opposition to them and to say that taxes of this kind, whether they are tariff taxes or sales taxes, break the three main principles of taxation which all political economists of note have given their adherence to as sound principles. Taxes, in the first place, should be collected as much as possible in proportion to the ability of the taxpayer to pay. That is simple common
sense. Any one who thinks for a moment will come inevitably to the conclusion that a workman who has to calculate very carefully with his wife on a Saturday night how his week's wages will provide the absolute necessaries of life for himself, his wife and his children, is not a very fit subject for heavy taxes. But these taxes place just as big a burden upon a navvy as they do upon a millionaire. They put a bigger burden upon the navvy than upon the millionaire along many lines, because the navvy wants more clothes in the hard work that he does than the millionaire. As a rule, the navvy has a bigger family than the millionaire, and he is taxed upon the articles of clothing worn not only by himself but by every member of his family down to the baby in its long clothes and its little woollen boots.
The second principle of taxation is that all taxes should be certain, and not arbitrary. If you have an income and pay an income tax, the tax is certain as to time, amount and place, according to the size of your income. But these indirect taxes are absolutely arbitrary. If you buy, you pay, and if you do not buy, you do not pay. In other words, the open-handed, free spender pays taxation; the stingy man who puts his money in the bank gets off paying taxes as regards indirect taxation to the extent that he is stingy. I do not object to any man saving, but I think we ought to have a method of taxation that takes a fair proportion of his savings for the state. Taxes ought to take out and keep out of the pockets of the taxpayer as little as possible beyond what is necessary to carry on the government of the country. In the case of all direct taxation, that is the result; for every dollar collected by income tax or succession duties goes to the Government except a few cents for expenditure in connection with the collection. But in the case of a tariff, we take two, three, four times as much from the taxpayers as the Government gets, the two hundred or three hundred extra per cent going into the pockets of those who are protected under a tariff. That, briefly, is what I have to say about the defects of the Budget so far as I see them. *
I have said that a clear issue is raised by the Budget, on the one hand, and the amendment on the other. I notice that my hon friend the Minister of Trade and Commerce (Sir George Foster) is a little doubtful about the kind of support the amendment is likely to get on this side of the House. I think he expressed a doubt as to how far my hon. friend from
North Cape Breton and Victoria (Mr. McKenzie) and I could sail in the same boat. Well, in regard to that, Mr. Speaker, I should just like to say that we sailed in the same boat on reciprocity ten years ago, and we shall sail in the same boat on this amendment. I do not care to speculate any further than the present moment in my history and the history of my hon. friend. But why should the hon. Minister of Trade and Commerce see such a difficulty in reconciling what he considers moderate divergencies of opinion? I recall that ten years ago this spring, he delivered a speech in the reciprocity debate, and was immediately followed, in a contrary sense, by the present Minister of Militia (Mr. Guthrie); but they now seem to sit very comfortably in the same Cabinet so far as their personal relations are concerned, though I am bound to say that external evidences from time to time show that they are both afflicted with a similar apprehension as to the results in an election which now cannot long be postponed. A more recent case of reconciliation than that occurs to me. My right hon. friend the Prime Minister, with what I am sure is a grim sense of humour which he manages' to hide most of the time-for he is a very serious-minded man-when he went west took with him my hon. friend the Minister of Immigration and Colonization (Mr. Calder), and he took him west for the very specific purpose of making him toe the line on tariff matters-and he did some line toeing, all right. No doubt it was not difficult, because he saw a light, either before the journey or on the journey. The Prime Minister got the truth into him, and he toed the mark. I have an opinion, Mr. Speaker, that he did not see much light. What really happened to him was that he was led into a swamp by a fire-fly. But the fact that the Minister of Immigration and Colonization met with an accident of that kind furnishes a very small obstacle in the way of an energetic Highland Scotchman nimbly jumping into the light of the sun; and while I cannot congratulate the Minister of Immigration and Colonization, I congratulate myself and my friend hon. (Mr. McKenzie) that for the moment at any rate we are getting along all right. This is a first-rate amendment, and I think the betting is good that my hon. friend from North Cape Breton and Victoria will support it. %
Now I want to examine the amendment just a little, because with the Budget it raises, as I say, a very distinct issue for [ Mr. M. Clark.]
the people of this country. My right hon. friend the Prime Minister, with a courage and honesty which I think has done a great service to the public life of Canada, has left the people in no doubt as to where he stands on fiscal matters. He stands on the principle of protection. With equal benefit to honest politics in this country, an amendment has been produced on this Budget which is in disagreement with the principle of protection. It challenges the principle of protection.
There are no " hear, hears " opposite.
Mr. CLARK (Red Deer) :
amendment is there, and it challenges the principle of protection.