May 12, 1921

FROM VOL. IV-INTERNATIONAL FINANCIAL CONFERENCE


Percentage of Expenditure for Defence compared with Total Revenue based on Figures for 1920-1921 - British Dominions Revenue Expenditure for Defence %P. 73 .' $ 432,000,000 £ 49,905,000 £ 27,713,000 £ 27,967,000 £ 134,800,000 $ 15,215,000 £ 3,795,000 £ 3,968,000 £ 1,386,000 £36,482,000 3- 5 7-6 14-4 4- 9 28- P. 89 P. 93 P. 83 (Note figures for Canada are based on Revenue for years ending March 31, 1921, and estimated expenditure for the following year.) - European Countries Revenue Expenditure for Defence 1920-21 %P. 65 £ 1,418,000,000 Lire 26,960,000,000 Francs 24,770,000,000 " 9,300,000,000 Goulden 733,113,000 Pesetas 1,842,720,000 Francs 412,812,000 (1919.) Kronen 929,400,000 " 759,785,000 " 427,700,000 £ 230,429,000 L 5,370,000,000 F5,118,000,000 F 737,000,000 G 84,902,000 P 707,216,000 F 196,905,000 K 197,942,000 K 61,572,000 K 63,900,000 16-3 201 20-7 7- 9 11-6 38-4 (a) 4921-3 8- 1 15-P. 53 P. 43 P. 39 P. 99 P. 105 P. Ill P. 117 (Federation.) P. 123 P. 129 (a) Of this amount expended in 1919 F. 144,000,000,000 was for mobilization. See figures for the following countries in same Vol. IV as follows:- Finland Page 135 Czecho-Slovakia. Esthonia... Greece.... Latvia.___ Lithuania.. Poland.... Roumania. Germany.. Austria___ Hungary... Bulgaria... 143 151 159 167 177


P. 187 P. 191 P. 195 P. 201 P. 203 P.207 P. 213


South American Countries Revenue Expenditure for DefenceArgentine Rep Brazil Chile Uruguay Asiatic Countries. China (1919) Japan (19-20) Siam (20-21) Pesos 428,100,000 Milreis 633,711,000 (Gold and Paper) $ 300,200,000 $ 38,044,000 $ 490,000,000 Yen 1,064,191,000 Ticals 72,500,000 P 62,701,000 M 143,100,000 $ 98,826,000 $ 7,270,000 $ 207,832,000 Y 544,283,000 T 17,920,000 327C



From this table it appears that Australia with a revenue of £49,905,000, 'spent £3,- 795,000 for all defensive purposes, or 7.6 per cent of its whole revenue while Canada spends only 3.5 per cent. New Zealand, with a revenue of £27,000,000 odd, spent £3,968,000, or 14.4 per cent of the whole income of that country was devoted to military and naval expenditures as against Canada's 3.5 per cent. South Africa, with a revenue of £27,967,000, spent £1,386,000, or 4.9 per cent of the total revenue. Now we come to another great Dominion. India, with a revenue of £134,000,000 spent £36,000,000 for defensive purposes, or 28 per cent of the total revenue of the Indian Empire. The figures I give for Canada, I may say, are based on the revenue for the year ending March 31 last, and the figures in regard to our expenditures are in the Estimates now before the House. Now, I propose to examine the expenditure of some of the European countries on the same basis. The United Kingdom, with a revenue of £1,418,000,000, spent £230,- 429,000, or 16.3 per cent of her total revenue for defence purposes. Italy spent 20.1 per cent, for purposes of defence; France, 20.7 per cent; Belgium, 7.9 per cent; Holland, 11.6 per cent. Spain, with its small per capita expenditure, expended on her army and navy 38.4 per cent of her total revenue; while Switzerland, on last year's figures spent 49 per cent of her revenue to maintain her army; she has no navy. This, I may say, does not take into account the Cantons of Switzerland, but merely the Federation. Sweden, with an income of 929,400,000 kronens, spent 197,- 942,000 kronens on her army and navy, or 21.3 per cent. Norway spent 8.1 per cent; Denmark, 15 per cent on defensive purposes. Take the nations of Europe, running from the lowest, 7.9 per cent, to the highest, 49 per cent of the total revenues of those countries are expended on armaments for the maintenance of armies and navies. Is it any wonder that the conference of Brussels made a recommendation on the question of further expenditures on armaments?


?

An hon. MEMBER:

Hear, hear.

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UNION

Hugh Guthrie (Solicitor General of Canada; Minister of Militia and Defence)

Unionist

Mr. GUTHRIE:

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REVISED EDITION. COMMONS


cent. These are all the European countries in regard to which I am able to furnish figures. For South America: in the Argentine Republic 15.6 per cent of the whole expenditure is for the army and navy; in Brazil 26 per cent of the whole expenditure is for defence; in Chili, 43 per cent of the expenditure is for defence; and in Uruguay, 17.7 pr cent. Now let us take Asia: in China, 41.9 per cent of the total expenditure is for the army and navy; in Japan 47.9 per cent of the total expenditure; and in Siam, 20 per cent of her whole expenditure. We have wended our way through North America and South America, through Europe, through Asia, we have touched on Africa, and we have looked in upon the larger islands of the 5 p.m. Pacific ocean in our search for comparisons. Make what comparison you deem proper, frame it from any viewpoint you desire, in every instance the position of Canada upon the question of military and naval expenditure is so outstanding, so pronounced and so satisfactory it should silence all criticism on the subject. I do not know, Mr. Speaker, that I need deal further with that question. I had the honour of attending the Brussels Conference in September last, and I was a party to the resolution which my hon. friend from Shelburne and Queen's has laid before the House. I came home from the conference imbued with the idea that one of the greatest curses in the world to-day was military expenditure. I came home as fully determined as possible to plunge the knife into the military expenditure of this country so long as I did not go below the line of safety. I am disclosing no secret information which I should not make known when I inform the House that when the Estimates of the Militia Department for the present year and for the present requirements of this country were submitted to me in the first instance-Estimates not prepared extravagantly or elaborately, but merely providing for what in ordinary times one might call the absolutely necessary military requirements of Canada-when all the various branches of the department had made their requests, the aggregate was almost $17,000,000. This was the amount we should have had to ask for to keep up just the ordinary, pre-war, peace-time military establishment. My hon. friend from Shelburne and Queen's expended for this purpose away back in the year 1905 the sum of $5,678,000 upon the militia. If the purchasing power of the dollar in 1905 was upon the basis of the dollar to-day it would have required an expenditure of over $11,000,000 to carry out the modest programme of 1905.


L LIB

John Howard Sinclair

Laurier Liberal

Mr. SINCLAIR (Guysborough) :

Are my hon. friend's calculations based on the existing rate of exchange in the European and Asiatic countries?

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UNION

Hugh Guthrie (Solicitor General of Canada; Minister of Militia and Defence)

Unionist

Mr. GUTHRIE:

They were prepared by very expert officials, but I cannot give my hon. friend the information he seeks. I can tell him this however-the figures presented at the Brussels Conference are the figures which each nation furnished from its own Treasury Department, and in all these calculations I have given the figures in the currency of each country, making the comparison by percentages which absolutely avoids the question of exchange.

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L LIB

John Howard Sinclair

Laurier Liberal

Mr. SINCLAIR (Guysborough):

I do

not think my hon. friend understood my question. Take the case of Great Britain, a pound in Great Britain is worth approximately $4.

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UNION

Hugh Guthrie (Solicitor General of Canada; Minister of Militia and Defence)

Unionist

Mr. GUTHRIE:

I gave the figures for

Great Britain in pounds sterling.

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L LIB

John Howard Sinclair

Laurier Liberal

Mr. SINCLAIR (Guysborough) :

Is the calculation based upon what the pound is worth to-day or on $4.86, the normal rate of exchange?

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UNION

Hugh Guthrie (Solicitor General of Canada; Minister of Militia and Defence)

Unionist

Mr. GUTHRIE:

I think my hon. friend

must have misunderstood me. The tota expenditure of the United Kingdom is on6 billion and some odd pounds. Its army anc navy expenditure is 230 million odd pounds. The ratio is 16.8 per cent; it does not affect the question of exchange.

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LIB

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Mr. KING:

What about a per capita

basis?

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UNION

Hugh Guthrie (Solicitor General of Canada; Minister of Militia and Defence)

Unionist

Mr. GUTHRIE:

In that instance the

figures are upon a dollar basis. The figures are given in the currency of each country in the second and third statements dealing with percentages.

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L LIB

John Howard Sinclair

Laurier Liberal

Mr. SINCLAIR (Guysborough):

It is the per capita basis that I have reference to.

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UNION

Hugh Guthrie (Solicitor General of Canada; Minister of Militia and Defence)

Unionist

Mr. GUTHRIE:

I could get that information, but I do not happen to have it under my hand now. However, the point I make is this: That I have resolutely endeavoured to cut down military expenditure in Canada. I was impressed with what I heard, and with what I saw at the Brussels Conference, and I deliberately determined to cut down this expenditure in every

reasonable way. Not only was it my own determination to do so but it was by positive instructions from my leader the right hon. Prime Minister. I had little alternative in that respect; I not only cut the expenditure down because it was in accord with my own judgment, but also because I was positively instructed to do so. A serious question is, have I cut it below what I should have done? I do not desire to say anything unkind about certain criticisms which are offered in this House from time to time in regard to military expenditure, although I do think much of this criticism arises very largely through a lack of information on the subject. I have heard motions put in committee to reduce the vote for the annual drill of the militia from $1,500,000 to $750,000. Why, you might just as well cut that expenditure out altogether. If you are going to have a militia you will have to drill it, otherwise you had better not have a force at all. The actual figures required this year for the training of militia units, the volunteers, was $2,700,000, but we cut the figures down to li millions. This sum will only allow us to drill eighty per cent of the militia units at sixty-five per cent of their strength, allow them only six days' annual training instead of, as formerly, twelve days. That is a very substantial cut. If you go below that amount you might as well wipe the expenditure out altogether. I express the earnest hope that next year sufficient money may be voted by the House to enable all the militia units in Canada to perform their annual training at full strength and for full time. It will require at least $1,200,000 additional to do this, but it will be money well spent by the country. Another hon. member criticised the amount asked for in the Estimates for the permanent force, and moved to reduce the vote by $2,000,000. The Permanent Force is at rock bottom at the present moment, and every dollar in the Estimates is absolutely necessary to maintain this small force. We will not come out even this year unless we suffer from a few desertions this summer as we usually do at that season, so close have we cut those figures. I think there was one other item in the Estimates against which a motion was made this session. It was to cut out the pay and allowances to officers-the little allowance which the commanding officer of a unit has for the purpose of paying the incidental expenses of the unit, the little outgoings that otherwise he has to pay out of his own pocket. Does the House 2081

not know that the band of loyal men who command our militia units give their time practically for nothing, that every man of them is a loser from the financial point of view, to say nothing of the loss of time. The money they draw does not as a rule come to them, it is funded for the purposes of the regiment. The expenses in far too many cases have to come out of the pocket of the commanding officer. There is absolutely no financial gain for any man in the militia. It is loyal, patriotic work on the part of the men who command these unfts, and I would be sorry indeed that the day should come when this House should cut out these trifling allowances to men who so freely give their services, their time and their money.

May I make just one more reference to the attitude of my hon. friend for Shelburne and Queen's and also to the attitude of my hon. friend the official leader of the Opposition in regard to the Militia of Canada. The former in his speech on Tuesday stated, used this language-and the passage will be found at page 3252 of Hansard:

Now come, if you will, to the question of naval and military expenditures. If anybody says that in this country we have no need of any naval or military expenditures-once in a while I hear some suggestion of the kind-I do not wish to be included among the list of people who entertain such views. A self-resepcting country must have a small standing army, a nucleus that would be available when an emergency arises, and it must have, in a moderate degree, even some naval organization.

But this is the part to which I wish to draw particular attention:

But, I do humbly submit, this Is not the time for these things. My hon. friend the member for Quebec South (Mr. Power), himself a gallant returned soldier, the other day reminded us of an important fact. We have 400,000 trained soldiers in Canada to-day-the best material for fighting that the world has ever produced. These men can be called upon if any emergency arises. Why we should anticipate any emergency at this time is not easy for anybody to conjecture. If there ever was a time when we had need of but little military expenditure it is to-day, and I believe the men who will be most ready to confirm that view will he the returned soldiers themselves. They have had all the war they want-

Mark those words:

-they want a chance to get hack to the arts of peace. And so I say that the military expenditure might well have been curtailed in the present year in larger measure than has been attempted by my hon. friends opposite.

My hon. friend the member for South Quebec during the passing of the Militia Estimates made an exactly similar state-

merit. Last year when the Militia Estimates were under discussion my hon. friend the official leader of the Opposition made another very similar statement, which will he found at (page 13675 of Hansard:

I would point out that we have in this county at the present time an army of experienced men who need no drilling, men who have been through the war and have suffered its hardships. No amount of drilling in the world will make them more efficient than they are to-day, and until we are through with the work of demobilization we can well afford to dispense altogether with annual drills.

What do these statements mean, Mr. Speaker? They mean simply this, that we have in Canada at this moment about

400,000 of the most highly trained soldiers that the world has ever seen, men who have gone through the worst grilling in battle that the world has ever known. They have bared their breasts to the shot and shell of the enemy, they have taken their chances, they have done much to secure us who stayed at home in our lives, our homes and our liberties. And the message to those brave lads from the leader of the Opposition, from his chief lieutenant who sits beside him, and from the hon. member for South Quebec means, if it means anything: We will be so penurious and so miserly that we will not spend any further money for military training, but if trouble comes in the future we will call again on those brave souls to protect us. Surely, in the name of God, these men have earned some measure of relief, surely under high heaven one may honestly declare that these men have done their bit, their full bit, and are entitled to rest and to immunity while others are in training to take their places. I want every returned soldier-

Mr. MACKENZIE KING (rising) -

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UNION

Hugh Guthrie (Solicitor General of Canada; Minister of Militia and Defence)

Unionist

Mr. GUTHRIE:

I will not be interrupted for the moment. I want every returned soldier to know the attitude of hon. gentlemen opposite upon this question. To my mind it is the most unjust, the most unreasonable and the most ungrateful attitude that could be assumed by any body of men in this or any other country in regard to those gallant men who served their country during those long and awful years of war.

Now, Mr. Speaker, we are told, on the other hand, that there will be no more war, and the cry is/in some quarters: Wipe out all military expenditure. That cry is popular, very popular among some elements in this and every other country. It is particularly pleasant to the ear of the BolshefMr. Guthrie.]

vist, to the ear of the Red and to the crowd which gathers around the soap-box orator at the street corners in our big cities. They like it, they talk it, they write it in their newspapers. Cut out all military expenditure, is their demand. We reply: No. Reduce the military expenditure to the line of safety and do not go below that line. We have reduced far below the pre-war basis

it was pretty high the year before the war, $11,000,000 and over-we have come back to the same basis we had in 1905, 1906 and 1907. We have adopted the recommendation or rather the suggestion, of the Brussels Conference, and we have carried it into effect to a greater extent than has any other country in the civilized world. I know there are those who believe that the millennium is at hand. I know there are those who believe the League of Nations is going to solve all the difficulties of this world. God grant that it may be so. If the League of Nations shall succeed in maintaining peace among the nations of the world, if it shall succeed in removing from the minds of men the fear of war, and the burden of war from the backs of weary multitudes, it will have accomplished the greatest thing which has transpired in this world since Christ was born in Bethlehem. Let it go on with its good work and it will have our God speed. Let it prosper. But I am inclined to think that the better judgment in this country and throughout the world at this moment is that the time has not yet come when "men will beat their swords into ploughshares and their spears into pruning hooks," and until that day does come we, as trustees of the people and of this country, have this clear duty imposed on us, which we have always carried out in the past and will carry it out in the future-the duty of maintaining a sufficient military and naval defensive force to preserve law and order within our own boundaries, to preserve the life and property and homes of our own people, and to keep the shores of this beloved country inviolate, no matter who shall be the aggressor.

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May 12, 1921