June 9, 1922

CON

William Garland McQuarrie

Conservative (1867-1942)

Mr. McQUARRIE:

My hon. friend has not answered my question.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Thomas William Bird

Progressive

Mr. BIRD:

It would take considerable time for me to define just what small industries are.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
CON

William Garland McQuarrie

Conservative (1867-1942)

Mr. McQUARRIE:

As far as I can see it is a pertinent question.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
LIB

George Newcombe Gordon (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

Mr. DEPUTY SPEAKER:

The hon.

member is not required to answer questions unless he so desires, and he has indicated that he does not wish to do so.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Thomas William Bird

Progressive

Mr. BIRD:

I do not wish to repulse the hon. member in any way, but really I do desire to continue my speech. I think that in a general way the fact is as I have stated in the case of the small industries. As a general rule it is true in the United States and Canada that the small industries have given way to the big industries, and that we, at the present time, are pretty well in the grip of these big combinations. I tell you that a big industry to-day can tax the clothes and the boots I wear with more impunity than our Finance Minister can tax soft drinks or candy. I believe these big trusts can tax us in a way that would turn King Charles I. green with envy if he were looking on, and make such men as Pym and Hampden turn in their graves, and that is a long time ago in the history of British liberty. I can refer you to a book on industrial relationships, issued by the United States government, that would make you sit up and take notice of the conditions on this continent in regard to the freedom and liberties of the people. We are pretty well within the grip of these 'big industries, and what does it mean? It means this: The people of Canada, as a rule, do not read much Red literature; they are better balanced, I suppose, than to do so. But they do observe the operation of the big trusts in their daily life; and I tell you that the operation of those trusts is a better argument for socialism of the most extreme type than any Red literature that was ever spewed forth from a Bolshevist press. Now that is Where you manufacturers have gone; there are no longer any manufacturers in the usual historical sense. Now just let me conclude with a word-

The Budget-Mr. Bird

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
LIB

James Alexander Robb (Minister of Trade and Commerce)

Liberal

Mr. ROBB:

Before my hon. friend leaves that, are we to understand that he is opposed to all trusts including the Grain Purchasing Trust?

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Thomas William Bird

Progressive

Mr. BIRD:

I am not opposed to any Grain Purchasing Trust at all.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
?

Some hon. MEMBERS:

Oh, oh.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Thomas William Bird

Progressive

Mr. BIRD:

Let my hon. friend present a case and I will give my judgment upon it; but I am not going to be led into any digression. Just the same I do believe in a Wheat Board.

Now I am going to say a word on the patriotic aspect of these questions. The protectionists are nothing if they are not flag wavers. We have had a lot of talk about Germany. We have heard something about the "Blood-stained hand of Germany" and we have heard even worse statements about that country; and when you get that spirit turned inwardly on internal affairs you get an attitude that is very hard to bear. I mean you get a superior attitude; you get an attitude that ought not to obtain between reasonable citizens in the same country as to patriotism and fidelity to one's country. What does all this talk by protectionists about the building up of our country by protection amount to? I want to say very briefly that in my humble view we have three difficulties in Canada in the way of building up a strong or united nationhood. The first of these difficulties is that we are a federation of divers political units. I think it is, Bagehot who says, "Of all forms of government, a federation demands most of its people and of its statesmen." Now in the future Canada is going to demand much from its statesmen and its people by reason of the fact that it is a far flung country with divers political units federated. The second difficulty is of a geographical nature. Nature-the greatest sectionalist in Canada, infinitely worse than the Progressives -has divided this country very effectually. Nature could not very well have reared a higher range of mountains than the Rockies; it could not very well have made a wilder wilderness than Ontario-I beg your pardon, western Ontario.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
?

An hon. MEMBER:

Are you sure you do not mean Toronto7

Mr. (BIRD: No, I do not mean Toronto although I believe some one has said that the hub of the universe visibly protrudes from that part of Canada; but nature has so destined our conditions that the influences that play from east to west, and

west to east, should be permanently obstructed; and from the time of the Greeks down to the present conditions of that kind have militated against the building up of united countries. It seems strange that nature should have so effectually obstructed the interplay of influences east and west; and having done that should have so effectually exposed us to the influences that play from the south-should have laid us wide open to the influences that come from the great political unit to the south of us.

I want to say that these three conditions are going to demand much of the statesmen of Canada in the future. To keep this country united is going to require a lot of wise planning. It is not a case of loyalty at all, it is just a case of economic necessity; and economic necessity, which is the first law of our existence, on occasion will come before that perhaps finer sentiment, patriotism itself. But let me say that protection seems to aggravate every one of these conditions-every one of them. It comes in and seems to deliberately drive a wedge in each one of these conditions. We have long believed that protection was a mischief maker internationally; but we are also beginning to see that it is a mischief maker internally, and when hon. members to my right talk about sectionalism in a strain of irony, working us up, so to speak, they ate doing something the final influence of which they cannot very well be aware of, and I would advise them to go lightly on that strain. If conditions were different in this country they might do it to their utmost; but seeing that we are so far flung, and so loosely knit together, they would far better get on to some other and more safe line of argument than that.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Oliver Robert Gould

Progressive

Mr. O. R. GOULD (Assiniboia):

It may seem rather strange to the House that the Progressive party should persist in continuing the debate in this manner. However, we have a story to tell and possibly, even if we do not take up so much time individually as some other hon. members, we may be excused for not remaining silent. I believe we have all arrived at the conclusion that one day more or less here at the present time does not matter materially, seeing that we who are engaged in agriculture are now unable to get home to take part in the very important occupation of earning a livelihood-that is to say, putting in the crops in the western country; that time has passed.

Now in my earlier remarks, and I do not propose to take up any great amount

The Budget-Mr. Gould

of time-I must associate myself-and I do so with great pleasure and earnestness -with all that has been said by way of compliment with respect to the Minister of Finance, (Mr. Fielding). I pay that compliment to him almost in the sense of a son to a father-that is, with the respect that a son should have for a father -for I must say, Mr. Speaker, that long years before I had the honour of entering this House I had watched with much interest the endeavours-yea, the accomplishments-of the hon. minister, and, certainly, it had not occurred to me in those days that the privilege would be afforded me of coming here and being a colleague of that hon. gentlemen. Yet, I must confess that I was to a great extent, by precedent, perhaps, by the teachings of my people, taught to be a believer in the principles upon which he stood. But, as time progressed, and I arrived more at years of discretion, I began to see that I would have to reason for myself, and that he, and the party to which he belonged, after having had opportunities afforded them for many years since Confederation, were not seemingly bringing to a fruition those things for which the Liberal party professedly stood. I recollect distinctly, going back to 1893 and 1896, the first platform of his party, and I followed it all through. That is an aside at the present time. I wish, though, to state that, as I have come up to this House, I have watched the keen and sprightly walk of the Minister of Finance, and I have thought to myself that he was a man older in experience than he was in years, and I am sure we are all impressed with that.

Now, Mr. Speaker, the expressions of opinion that have come from this corner of the Chamber have all been initiated, perhaps, by the consciousness of conditions which obtain in the country, particularly affecting the class of people, whom we represent; that is the agricultural class. Many theses and doctrines have been promulgated. The effort has been made

and it has come from many sources in this corner-to persuade the powers that be that we have a real grievance, but while advancing that claim we believe we have a solution for it. This question has been repeatedly before the House. The presentation of the case has been made in like manner, except, perhaps, not in as great volume, ever since 1919. The hon. member from Marquette (Mr. Crerar) led a small party of men in this House, in deference

to expressions of opinion that were coming from sections throughout the country, and those few followers put forth the contention that agriculture in this country had not been receiving its due recognition. In spite of predictions, the fact that we have 66 members in this corner of the House belonging to the Agrarian party is a concrete evidence of the fact that people throughout Canada believe that we have not been receiving a proper deal, or that we have not been receiving justice, and we have been sent here for the distinct and express purpose of again explaining to Parliament, and, by all honourable means, obtaining for our people the things we have been so long denied. That is the reason we are here. And I have wondered, as I have looked over the provisions of the budget speech, whether we should consider that speech and the provisions thereof, as representing love of us, or fear of us, or neither.

Before proceeding to deal with the budget, I wish to ask a favour, (because I desire to digress a little from the budget address, and bring up a question which, perhaps, should have been dealt with when the estimates were considered, and if I had had the information when the estimates were before the House which I have at the present time, I would have mentioned it then. This question has to do with the national expenditure on the briquetting plant in the district of Assiniboia. We all know that the Dominion government has expended certain sums of money for a number of years to erect a briquetting plant at Bienfait and endeavoured to find out the best means-at least that is the professed idea-of preparing lignite coal, Which is there in large quantities, for the people of the country. I have expressed my opinion on this matter previously. The lignite coal exists there in such large quantities that I believe there is sufficient to energize all the electricity required in the southern part of Saskatchewan, yea, perhaps, in the south western part of Manitoba, and, not being a wooded area, we would like to have that coal brought into such a state that the settlers could use it in furnaces, or others could use it commercially. About $820,000 was expended on that briquetting plant, but it seems to me, from information I have received, that we have been working upon wrong lines. It is proposed to extract the moisture from that coal and form it into briquettes by means of a binder. Something is expected from the by-products

The Budget-Mr. Gould

thereof. I find now that the estimates of the price of briquettes far exceeds the first estimate that was given when the project was first undertaken.

This is a national undertaking. Apart from the scientific aspect, it represents moneys that are taken from every district of Canada, it is of great importance in a national way, and that is one reason why I introduce it. I put questions on the Order Paper some time ago and received replies from the minister. He stated that he would have some by-products in the recovery plant, but he did not know to what extent the by-products would be useful. He states that the recovery process is for the extraction of coal tar, and yet on the other hand, we find that coal tar is to be the basis of the binder that is to be used for that lignite. But we also find that $8 per ton is the price, at the head of the Great Lakes, of tar to be used as binder, that has to be imported into the province of Saskatchewan, carried down to Bienfait, and used there to replace the tar which as a by-product is being extracted. The price of the briquettes which contain 11,500 heat units per pound is $12.25 per ton and we at once realize the commercial impossibility of manufacturing lignite into briquettes, and the commercial failure that must result, in competition with other briquette coal that is being brought in at the present time. In the city of Winnipeg briquette coal, with about 16,000 heat units per pound, is being sold at $17 a ton. If you take into consideration the number of heat units supposed to be incorporated in this lignite coal, the price of the tar, and so on, that has to be imported to bind it, you will see that for us to further pursue that as a commercial proposition would be inadvisable.

It is said then that we must have an alternative. On that point I have some information which I wish to submit to the House, and I hope the Government will pay attention to this. We desire to have the coal made commercially available as quickly as possible. We would like to have erected a plant whereby the moisture in the coal, about 30 per cent, could be extracted, before the product is shipped out to us. Experiments have resulted in demonstrating the fact, that whether it be lignite, anthracite, or even peat, it can be used in powder form much more cheaply, and without waste. In the use of lignite coal there is much waste and ash and

clogging of flues or pipes, whether it be used in stoves or furnaces or in a manufacturing way. It can be used in a powdered form, both for stoves and manufacturing purposes, and it can be powdered by the addition of a plant, requiring about one fourth the capitalization necessary for a briquetting plant, such as we have at the present time. I believe this powdered coal can be turned on and burned in that form in a pressure plant, the same as gas or oil. The tars not being used in the binder, there is very little waste, and practically no residue after the coal is burned. We get practically 95 per cent out of our coal, whereas at the present time, I believe, in the case of lignite coal, the available heating element is almost 70 per cent over and above waste.

That is a problem which I think the Dominion government should look into. I do not know whether to condemn the past government because a sufficiently thorough investigation did not take place; but it is certain that we, in the. West, as a people are disappointed because years ago we expected these briquettes to be placed upon the market and, according to information contained in answers to questions which I placed upon the Order Paper, the time seems just as far distant as ever. Nevertheless, $126,000 is being voted again this year for the purpose of this plant. It is quite unusual for a member to protest against expenditures in his own electoral district; usually, hon. members are in the habit of asking for greater expenditures; but I am talking in the interest of economy, and I state that, in my humble opinion, this money might be better employed for some other purpose. I hope, naturally, that it will not be taken away from my constituency, because I should like to see the money expended on a railway which runs right across our coal fields. This would tap four lines of railway running east and west; and if this money were spent in that way, the railway would be a real asset to the people of my constituency which is lacking in wood, so that they must rely on fuel from outside sources to keep themselves warm and comfortable during the winter. As I have said on many occasions, we have reached the point where settlers have actually attacked cars and taken the coal off rather than see their children go cold. Therefore, if the Government will pay heed to this, I hope that next year we in the West will learn that a real solution of the problem has been found. I repeat that I do not believe a

The Budget-Mr. Gould

solution will be found in following out the present plan of briquetting that lignite coal. That is all I wish to say on this matter at the present time.

I want to deal for a few minutes with some statements that have been made by the hon. member for Centre Vancouver, (Mr. Stevens) who, I am sorry to say, is not in his seat. He rather deprecated the fact that the agricultural portions of Canada did not pay their share of the income tax. I almost gathered the impression that he would have the people of Canada believe that this was wilful on the part of the agriculturists. I am sure hon. members will believe the statement that has been repeated so frequently from this corner of the chamber, that the agriculturists are not doing this for any other reason than that they are unable to do so. Is it not a known fact to hon. members-I see the Minister of Agriculture (Mr. Motherwell) ; he will bear me out in this statement-that in Saskatchewan there are many school districts, in which during the past three, four or five years the people have questioned themselves whether they could pay taxes to keep the schools open. Even last winter municipalities took the question up and municipal meetings were held in many parts of that province, the question being asked: Can we extend our credit any longer in order to keep our schools open? The money is often not available to keep these schools open. Fortunately, through the intervention of the provincial government and the co-ordination of the municipal authorities, the schools were kept open until the banks offered credit again whereby the schools could be carried on. Why should hon. members in this House or men throughout the country try to give the impression that the farmers are wilfully escaping or endeavouring to evade or avoid their proper share of income taxation? They are not; they would be only too pleased if an opportunity were afforded them of paying a good round sum in income tax, because that would mean, as it does to those who have to pay tax, their ability to pay.

Again the hon. member, in reply to a question which I asked him concerning watered stock, said that 7 per cent was surely not an excessive profit. No, we say it is not an excessive profit if it is on actual cash that is invested in a company; but the hon. gentleman spoke of "unduly watered stock." To what extent must a man or a corporation go before the term "unduly" is applied? Do they recognize it

as a right that incorporated institutions in this country, through, perhaps, some concession, or through, perhaps, the value of an asset paying a huge dividend, may or shall or should, as they do, go throughout the length and breadth of the country and sell stock which is largely fictitious? They take money from widows, orphans or any one else, and they say: "This is an institution capable of paying 20 per cent and we want your money, why not buy some of this stock?" It does not, however, represent any equi'y or value except the ability of that company to pay interest on watered stock. If a depression should come, or the value go down so that they pay only 2 or 3 per cent, they call that hard times. We maintain still that, in many institutions which have a large amount of watered stock, two per cent on the watered stock would represent a good profit if it were paid on the cash value of the plant. We believe we are justified in calling the attention of the House to the fact that we do not believe in watered stock, whether it is unduly watered or watered to any other extent. We want all interests in Canada to stand on their own feet, on their own base, and this "unduly watered" proposition is something that we agriculturists know nothing about.

I have been listening to conversations concerning the banks. I do not think I am betraying any secret in saying that when I have listened to remarks and discussions in some of the committees and in this House, it has seemed to me that men who talk of corporations and so on have not the proper perspective; they have not the right viewpoint. They seem to look upon the banking institutions of Canada as corporations that possess the credit of the Dominion of Canada, given to them by the Dominion of Canada, so that they can take the deposits of all the people and their own currency, inflated more or less by acts of Parliament, send the money out of the country and invest it in foreign bonds. I deprecate this. When we, having legitimate local interests, appeal to these institutions for legitimate credits to carry on our businesses, we are told that money is not available. For example, some years ago a subsidiary company owned a lighting plant in Rio de Janeiro, and we in the West were unable to get loans of money necessary to capitalize the businesses that we were endeavouring to carry on for that year. That i.i one reason why I consider that the moneyed institutions of Canada should have greater restrictions placed

The Budget-Mr. Gould

upon them. They should not be privileged to .the extent they are taking out of the country funds that rightly belong to the people of Canada, where there is so much need of money for the development of our natural resources. The farmers, who are working under such disadvantages, in the best of circumstances, and on whose activities the prosperity of this country depends, are absolutely handicapped because of the higher rate of interest that is charged them in that respect. An a layman I would urge that point as forcefully as I can upon the Government and upon members of this House, because I nave had some experience in this matter, as I know my neighbours have who are struggling in the West to develop the resources that lie dormant in this great country and are doing their best to convert those resources into national wealth.

At six o'clock the House took recess.

After Recess

The House resumed at eight o'clock.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Oliver Robert Gould

Progressive

Mr. GOULD:

Mr. Speaker, since the House rose, three hon. members have asked me to deal a little more fully with the briquetting plant at Bienfait, with regard to which I had made a few remarks before six o'clock. I have some figures here, which, perhaps, will be interesting to hon. members and also to many of the people of Canada, particularly the people of western Canada. We are very much interested in the question of the supply of fuel; in fact, to us in the West the matter is quite as pressing as is the question of the tariff. As the time of the House has not been occupied at any considerable length in a discussion of the fuel problem, I wish to devote a few minutes to it now.

The information that I wish to give to the House is with regard to the value of the briquettes manufactured at the town of Bienfait as compared with a like product which is being sold in Winnipeg at the present time. According to information which I have received, the briquettes manufactured at Bienfait would be worth $12.25 a ton, as at present estimated, f.o.b. Bienfait. These briquettes have approximately 11,500 heat units per pound, and exactly what they would be worth in the city of Winnipeg can easily be computed. We find that under the present freight rates, this commodity, worth $12.25 per ton, must be retailed in Winnipeg at $17.50. It is quite evident, therefore, that a product selling at $17.50 in Winnipeg, and containing approximately 11,500 heat units per pound, cannot successfully compete with a similar product containing 15,000 heat units per pound, and selling in Winnipeg at $17 per ton. I think I am justified in directing the attention of the House to the fact that even if we should find it possible to make a briquette from the low grade lignite which is found in the southeastern part of Saskatchewan, we are not warranted in continuing its manufacture, because we should have to compete with a briquette product already on the market which can undersell us on the basis of heat values, by one-fifth. Now, that is good, sound reasoning..

I have also been asked to explain further how this low grade coal can be used. It has been proved beyond doubt that anthracite, lignite coals in all their grades, and even peat can be successfully produced in powdered form and used in furnaces and ranges, both for domestic, and for commercial purposes. By the use of a very cheap power plant, operating by air pressure, the powdered product is forced into the receptacle in which it is burned and the amount used can be controlled by a tap. It is estimated that the use of such a plant would save in the household or in the manufacturing plant approximately 23 per cent of the amount now being expended for fuel, and that is a large item, especially on our western plains. If we can commercialize in this way these large deposits of lignite coal and save every farmer and every industry in western Canada 23 per cent of their present fuel costs, the effort shall have been well worth while.

Now, here is a splendid opportunity for the high protectionist to step in and to say that we should introduce protection on behalf of the production of this commodity, with its lower heat unit content and its relatively high cost. That is the argument of the protectionist in all cases; but I do maintain that the principle is fallacious. This is, in my opinion, a very clear illustration of the fallacy of high protection, and many cases analagous to the one which I have cited may be mentioned. We have an almost unlimited supply of this coal and it can be commercialized and prepared for use in an economical way-economical, because of the elimination of waste. All we would require to have at the mine would be a drying plant and a powdering plant. The

The Budget-Mr. Gould

coal would then be distributed throughout the country in the form of powder, and, as I have said, by the use of a small power plant it can be fed to the stove in a very satisfactory manner. It is much cleaner than ordinary coal and is much more satisfactory in every way. Without going into the matter any further I may say that I have in my office a long treatise on the subject and I should be only too pleased to give any further information to hon. members who are interested in it.

I wish again to draw the attention of the Government to a matter which has been mentioned on the floor of this House on two or three occasions during the present session. It has to do with the liquor question as affecting the southeastern part of Saskatchewan. A very regrettable condition exists there. In the lower part of my own electoral district, about seventeen export liquor houses have been continually carrying on the export of liquor, both to other provinces and outside the country, since the referendum was taken in that province. I do not want to say this with any egotism, but last year I endeavoured to find out who was responsible for granting permission to these institutions to operate in that province, and was unable to do so. Again this session, with the cooperation of the hon. member for Qu'-Appelle (Mr. Millar), I endeavoured to place the responsibility. I am not sanguine enough to hope that I have yet succeeded in finding out who is responsible for the condition which still obtains there. Not more than three days ago I received a letter stating that what are known as booze cars were running back and forth throughout the country. My people have protested in all earnestness against the existence of these houses, and if I am impotent to find out who is responsible for their existence, I think I have done my duty in bringing this matter to the attention of the House, and I hope that the Government will still co-operate with the hon. member for Qu'Appelle (Mr. Millar) and myself in an endeavour to place the responsibility.

I was much interested in an item I read in the paper a few days ago, and it may have some bearing on a solution of this problem, to the effect that a decision which was given in the Michigan courts some time ago sustaining the export of liquor to foreign countries and its importation from outside had been over-ruled by the Supreme Court of the United States. On May 15 the Supreme Court of the United States

handed down a decision in which they held that liquor while within the boundaries of the United States en route from one foreign port to another, could be seized under the national Prohibition Act. It may be that the United States will take advantage of this decision in connection with the international exportation and importation of liquors, and that may have some effect on those establishments in the United States. I hope it will have, simply because, as I have said repeatedly, the establishment and the retention of these institutions is much deplored by our people. These houses are a veritable nuisance in my district.

I wish now to say a few words with regard to the banking system of Canada in connection with the budget which has been presented to the House. Some ^people speak very strongly in favour of the banking system of this country, yet I think there are many reasons why we should consider whether we really have the very strongest banking system possible. Some years ago we had in the west the Northern Bank, which later merged with the Northern Crown Bank, which in turn was absorbed by the Royal Bank. A few years later we had the failure of the Farmers Bank, and there was a sorry story to be told in connection with that. Only recently we had the merger of the Merchants Bank with the Bank of Montreal. Fortunately, in that case the Bank of Montreal was strong enough to take care of the depositors of the Merchants Bank.

Bank clearings last year amounted to sixteen billions of dollars. That is a huge sum of money for the banks of Canada to handle, and it seems to me that in view of that huge turnover we have a right to make the banks pay a proportionate amount of the taxes of this country. In an address I gave in this House last year I made the statement, which can be substantiated, that the banks receive very liberal concessions, both in the way of credits by this Government and in the way of license they receive to send their own credits in and out of the country, and a further concessior. in connection with their building assessment. I pointed out particularly that in making their returns the banks give only the initial price of their buildings. I stated that I believed the great banks of Canada could hide, and were hiding their assets by being allowed only to send in the initial cost of their buildings. Let me give a homely illustration. An individual, whether he lives in a town, city or village or in the country, when he purchases a house or a

The Budget-Mr. Gould

farm soon finds that the initial price is not the price the property is allowed to toe assessed at for very long. As the district improves and settlers come in, the value of the property is increased, and the assessment accordingly. If that holds good in the case of the individual, I think it should also be applied in the case of the (banks.

I do not know what portion of this sixteen billions of dollars represents cheques, tout the total will be made up of cheques, acceptances, and general currency. If that is the case, at a very conservative estimate this sixteen billion dollars should stand an assessment of at least $5,000,000 to be paid into the Dominion treasury.

With regard to the stamp tax on cheques, and I am sorry to say that my leader was the first member of this House to regret the placing of stamps upon cheques issued by great corporations, let me say that many corporations in this country are only stock companies that are doing business on the money subscribed for their stock by the people of Canada, and they can well afford to pay this stamp tax. Let me give another homely illustration. The average individual whether he lives in a village, town or city, sometimes leaves ten or perhaps fifty dollars on deposit at the bank, if he is fortunate to have any money to bank, and when he wishes to purchase the necessaries of life, particularly in the country, he sends in his boy or some member of the family to buy five dollars' worth of groceries by cheque against his account, and in that way it will very soon cost him 50 cents in stamps to cheque out that fifty dollars. The individual has to pay that, so why should not big business men be called upon to pay the two-cent tax on every fifty dollars? I have seen it stated in the newspapers that the Finance Minister might modify his proposals in regard to the stamp tax. I trust that he will do nothing of the kind, simply because we have pleaded long and hard and earnestly that big business should pay its fair proportion of the taxation, and so far as this stamp tax is concerned, they have no right to hedge. Furthermore, if I can afford to pay $5,000 or $10,000 for a house or farm I can afford to pay two cents on every $50 cheque I issue, as the budget proposes. I would again urge the Finance Minister, if he was thinking of making a change in this tax, not to do so. I would rather see the tax graduated so that the larger the amount paid out by cheque, the greater the tax would be.

To return to the banking system of this country, and to show you to what extent the business of this country is tied up in these large banking institutions, we had in March, 1922, $1,230,000,000 of savings deposits in the banks of Canada, and of that amount $290,600,000 was on deposit with our largest institution, the Bank of Montreal. I am not singling that bank out for criticism at all, and only mention it to show the extent to which the banking institutions of this country control our credits. The savings deposits in the banks and the credits of the country are proportionately the same, and if the Bank of Montreal controls, as it does, one-quarter of the savings deposits of this country we have a right to assume, and we do, that it controls 25 per cent of the credits of the whole Dominion of Canada. That is an enormous power to be placed in the hands of any one institution, and while there are people who will say that it is all right, there are other people, and perhaps more, who will say that such a power needs looking into to see if we cannot find ways and means whereby these large institutions can be made to serve the basic industries of Canada and the interests of the people as a whole.

In any case, I hope the Finance Minister will not be persuaded to make it more difficult for the fundamental businesses of this country to find the cash, or the wherewithal, to carry on their undertakings. As has been stated, Mr. Speaker, we had a national debt of $2,427,296,798 in 1922, but in 1914 it was only $335,966,850. I have compiled a few figures which I will give you approximately. I do not do so with the idea of causing the publication of newspaper headlines to scare the people of Canada, but rather with the object of pointing out to them the absolute necessity of realizing the burden which rests upon the shoulders of each individual, so that they may better apply themselves to the task in hand of meeting that burden. My whole argument would be to arrive at some equitable means of assessing the taxation of this country. I am sure that when the people rightly understand the burden that is placed upon them they will not cry out so loudly. Convince the people that the taxation is necessary and that the method of assessing that taxation is equitable, and they will be better satisfied. On the basis of the figures that I have submitted the per capita debt of Canada would be $277.70. Now for a family of five, which is usually accepted as the basis of

1 i '!

The Budgets-Mr. Gould

computation, the debt would be $1,388.50 for the year 1922. In 1914 the per capita debt was $38.20, and in the case of a family of five would he approximately $191. It is no wonder there is concern in the public mind. Even in 1910 and 1911 there was a great hue and cry throughout Canada at the cost of government and the per capita debt; and when we view the situation to-day and find that we are burdened with approximately $8 for every $1 of debt at that time, the people are justified in paying more attention to this question of taxation. Apart from this huge national debt, we require to pay $466,983,359 this year which means a per capita charge of $53.27. Multiply that by the figure 5, representing the average family, and it comes to a total of $266.35. F urthermore, we have provincial and municipal debts, and taking these into consideration the debt per capita for carrying on business this year amounts to $466.35. Now it is positively alarming that we should have to bear such a per capita annual debt as $466.35. Even this does not make provision for the payment of one solitary cent of the bonded indebtedness of Canada which, as I have already said, is dangerously near $2,500,000,000. Bearing these facts in mind is not the question of taxation one that should be seriously considered? Is it not urgent that much greater attention should be paid by the people as a whole not only to the principles upon which that taxation is based, but also to the problem of devising ways and means whereby that taxation can be met.

Now, I want to make a few references to some of the things which have been said during this debate. The Minister of Justice (Sir Lomer Gouin), for example, gave figures to show the operation of the tariff from 1876 to 1901. He endeavoured to show that the percentage of taxes now gleaned from the tariff was not as great as it was in the period referred to. In so far as percentages go, the figures given by him were absolutely correct; but the minister failed to state that since the time to which he had reference many new forms of taxation have been applied, and therefore the percentages which he gave with respect to the operation of the tariff are less deserving of weight than he seeks to make out. The minister asked whether we could get along without the manufacturers. Certainly we cannot; no one in this country ever thought of such a proposition. I am sure that notwithstanding [Mr. Gould.3

the fact that the Progressives in this House have invariably been characterized as free traders, the fact remains that never from this corner of the chamber this session has any one proclaimed himself a free trader, nor do I think that any such statement was made during the election. We have asked, in particular, that in fulfilment of the planks of the platform upon which we stand, and likewise in fulfilment of the platform upon which the Liberal party professedly stand, the implements of production should be free of duty. Let me give you an illustration of how the tariff works out in that regard at present. Take a section of land, the cultivation of which probably necessitates an expenditure of $3,000. Before the man who farms that land can commence to raise anything with which to compete in a free trade market-for he really has to face unrestricted competition when he sells his products-he has to meet an average duty of 15 per cent. This, if applied to a capital of $3,000, means that he is fined to the extent of four or five hundred dollars. The amount will vary in localities in accordance with the difference in the value of the farm land. On the average, however, the farmer finds that he has to meet a charge of $400 or $500 before he can enter into business. In addition to that he bears his share of the duty on other articles that enter into consumption the same as any one in the town, city or village. But I maintain that the duty referred to is an extra tax levied upon his industry, and he is handicapped to that extent when he goes out into the markets of the world to sell any of his products. Success in agriculture is a doubtful thing. When it flourishes in Australia it may be a failure in Russia; when there is a good crop here in Canada the crops may be poor in the Argentine. These are factors that have to be considered. I suppose that if there ever came a time when agriculture was successful in every country of the world the industrj would become depressed and be liable tc succumb by reason of its very productive ness.

I recognize that simply to stand here and indulge in pious wishes with respect to the beneficiaries of a protective system will never get us anywhere. But the people of Canada have been lectured and lectured on tariff matters ever since 1873, at least, and wherein have they benefited? What have the people of Canada received? Well, we have received nothing.

The Budget-Mr. Gould

It is amusing to realize the position taken by the, small group known as the Conservative party on the question of the tariff. They say, "We stand for a protective tariff," but I have heard them quote instances where they lauded and praised themselves, because they had succeeded in reducing the tariff. It seems to me that it is absolutely inconsistent for them, at one moment, to be raising the banner on high and proclaiming "We are a protective party," and the next moment to take the compliment which might be paid them for reducing the tariff. Yet, on the hustings and in this House we have had instances of this, and I ask hon. members to try and explain their attitude. However, it is useless to plead with, or to quote instances, and give illustrations to, the beneficiaries of the system. We have been sent here for a direct and specific purpose, and I think we should have received more consideration in the budget which has been presented to the House. If we should link cur forces with those on the other side, our platforms being very much the same, are we not right in assuming that all Canada is strongly in favour of the sentiments expressed in our platform, or in their platform, or in both? It was stated on a thousand platforms during the last campaign, that there wa< no difference between the two platforms, and that was one of the strongest pleas and arguments advanced why the Liberals should be returned to power. There was so little difference in our platforms, it was argued, that they should be returned to power.

It is extremely disappointing, now that the opportunity has been given the Liberal party to implement the pledges made since 1896, now that the people of Canada have said, "We wil try them once more," and have reposed their trust in them, to find the country presented with a budget such as that which Lss been brought down by the Minister of Finance. I think, Mr. Speaker, the people of Canada will not forget it, and if the rejection of this budget at this time should render it necessary to go back to the country, a different story will be told, because the people did expect, Sir, that there was going to be another kind of budget brought down. Listening to the speeches which have been made by hon. members opposite, the thought came to me with a rush, and came to me repeatedly: Are these deliverances typical of the speeches made at the great Liberal convention held in August, 1919? Is this the type of speech which one would expect,

following the resolutions which appear in the Liberal platform? I think not. While the excuse has been offered during this debate that conditions have changed, I want to point out the conditions at the time the platform was framed, and when the war was on. The people knew or anticipated what the conditions would be, in fact we knew, and it was advertised at that time, that there would be a period of depression and yet the Liberal party went into convention in Ottawa in August, 1919, and framed their platform. I have been informed by one gentleman who attended the convention, with whom I have talked to a considerable extent, not a member of the House of Commons, but a gentleman who was present when the platform was framed, that he was ashamed of the interpretation that was placed upon this platform by the budget speech.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
LIB

Charles Arthur Gauvreau

Liberal

Mr. GAUVREAU:

Will you not give his name?

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Oliver Robert Gould

Progressive

Mr. GOULD:

No, that would not be honourable, but this clause of the platform which I will read will be an answer:-

And the Liberal party hereby pledges itself to implement by legislation the provisions of this resolution, when returned to power.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
LIB

Lewis Herbert Martell

Liberal

Mr. MARTELL:

Does the hon. member expect that everything will be done in a day?

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Oliver Robert Gould

Progressive

Mr. GOULD:

Possibly, tomorrow, you will go back to your constituency, and later you will be able to say "We were in power", and then you will have no further opportunity of implementing the promise. You will be told that you had been in power and the pledges were not implemented. The last clause in the Liberal platform distinctly and expressly states "When returned to power". The people of Canada- and well do we know it, Sir,-depended upon it and expected, particularly with reference to implements of production, that a change would be made, that that would be the point where it would start, and that implements would be made free of duty, so that we would have an opportunity of going into business of production on a much sounder and stronger basis than ever before. I referred to the similarity of the tariff plank of the Liberal party with the tariff plank of the Progressive party. And the story I tell the Canadian people and the story I tell the Liberal party to-day is that the Progressive party is the one who would implement that promise. Let the Canadian people

The Budget-Mr. Gould

know where we stand. Let the people know that this representative from Assiniboia is a Progressive, and that he is still absolutely standing upon his platform.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
LIB

Lewis Herbert Martell

Liberal

Mr. MARTELL:

Does the hon. member believe in the Liberal tariff platform plank of 1919 that he referred to?

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Oliver Robert Gould

Progressive

Mr. GOULD:

I would reply to that more fully. I believed in it in 1896. I believed in reciprocity in 1911, and regret that it was not adopted. I believe in it at the present time. I believe more in the tariff plank of the Liberal party than I believe in the Liberal party itself.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
LIB

Lewis Herbert Martell

Liberal

Mr. MARTELL:

Will the hon. member permit me a question?

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink
PRO

Oliver Robert Gould

Progressive

Mr. GOULD:

No, I think the hon.

member's question has been answered already. Let me illustrate a little bit further. I have a word to say to the hon. member from Brome (Mr. McMaster) whom I have learned to respect, yea, to revere. I have admired him on many occasions when he has stood in his place and advocated the principles which he believed his party was advocating. Well, do I remember them. I might go back in history to the time the hon. member paid me a visit in Assiniboia, when he came out there preaching the doctrine, very nearly, of free trade, telling the people most positively what the policies and principles of the Liberal party were. A lot of the people believed his statement, and had it not been for the feeling of my constituents and myself that the Liberal party would not fulfil their pledges if they had the opportunity, this being practically the doctrine I preached on every platform, I honestly believe the arguments anl persuasions of the member for Brome would have prevailed. But the people of Canada know now what interpretation means as compared with profession, and I regret-and I am very sorry to say this once again-the very, very small thing that has been handed out to the great majority of the people of Canada, who at least believed in the policies and principles enunciated in the Liberal platform which were similar to the policies in our platform.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
Permalink

June 9, 1922