June 13, 1922

LAB

William Irvine

Labour

Mr. IRVINE:

Does that apply to tariffs? If our commercial life is very largely conditioned by our commercial relations with other countries, would not our tariff have to be conditioned by the tariffs of other countries?

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN (Halifax) :

I think the tariff would play a very important part in that way.

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LAB

William Irvine

Labour

Mr. IRVINE:

Is not that exactly the same as the right hon. leader of the Opposition (Mr. Meighen) said a couple of years ago?

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN (Halifax) :

I forget

what the right hon. leader of the Opposition said a couple of years ago. But I was remarking, Mr. Speaker, that though we are citizens of a new and undeveloped country, not ranking as one of the first nations of the world by any means, still we are interested in international trade and international questions, and the condition of European countries, should appeal to us just as much as the condition of the people of one of our provinces should appeal to the people of the other provinces. We hear a great deal about Germany these days; she is the subject of much discussion and conference in Europe and of much discussion in this country. I think it is apparent to every reflecting person that unless Germany is put on the road to commercial activities every country in Europe will be adversely affected. It is a commonplace saying, and should not require repetition, that Europe can never be right until Germany is right-that is, in the economic sense. I think it is also a commonplace saying that we are intensely interested in the economic recovery of Germany, or any other country of Europe which is politically and economically disrupted. But, strange to say, the tendency the world over is to enact legislation of one kind or another with the object of preventing her recovery. As was suggested the other day by some hon. members, the war is over, and that part of it had better be forgotten. We can never forgive the guilt of Germany in forcing the world into the greatest tragedy known to all history; nevertheless for our own good and for the good of all the peoples of the world, it is necessary that she be restored, economically at least. Notwithstanding the necessity of this, there is a tendency the world over to do everything to prevent her from resuming her commercial processes. It is expected that she can pay the reparations assessed against her, while

at the same time she is prevented from trading with other countries. Obviously that is an unsound position to take. Germany can pay the reparations only by the exporting of goods. She has no money; there is not enough gold in all the world, by two-thirds, to pay the amount of reparations assessed against Germany by the allied powers. There is no other means known to the human intellect by which she can pay one dollar of the reparations except by the export of goods. Yet in many countries of Europe that procedure is being not facilitated, but rather retarded by restrictions of various kinds. Now, the effect of this was made clear just recently. It would appear from the report of the International Bankers' Association that they have decided that they cannot recommend an international loan to Germany until such questions as the reparations are settled. We are interested in that question; if we as Canadians are interested in our own country, we must of necessity be interested in this matter. And we have a right to speak about it, because we are interested in the restoration of international trading and in international politics. Great world events have brought us into that position, and whenever we have an opportunity to do so we should express what we believe to be the wish and the judgment of this country in that respect.

The member for St. John (Mr. Baxter), much to my surprise, gave expression to the view a few days ago that he would be perfectly content to see the German people dropped out of the universe altogether and become extinct. I was surprised, I say, to hear my hon. friend make that statement. I am dealing with the case of Germany merely from the economic point of view; I am not particularly discussing it with the view to presenting Germany in any more favourable light than she deserves. Well, what would this world be like if in the twinkling of an eye you took out of its economic system sixty millions of people? Disaster would overcome all the European countries. There would be a complete breakup of the present commercial fabric and of commercial institutions. We in this country would suffer tremendously. Any economic doctrine of that kind should find no support in this country any more than it should find support in any European country.

The member for Centre Toronto (Mr. Bristol), speaking on the budget a few days ago, left the impression with me that he

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thought it undesirable for this country to trade with Germany, but he admitted in the same speech that a company in Nova Scotia in which he is interested is exporting ore to that same Country. Well, how could Germany pay for that ore if we did not buy any goods from her? After all, Mr. Speaker, we get back to this position: that no country can sell unless it buys; it must import just as much as it exports; the moment it ceases to import it will cease to export, and that is true of all countries. What we want more than anything else is a resumption of normal trading among all the countries of the world, and it is the duty of all countries to do what they can to bring about that condition.

I fancy that it has been hardly profitable or interesting to the House that I should have taken so much time in a discussion of trade matters which are, perhaps, more of international than domestic importance. My only excuse for doing so is to impress upon the House that , we cannot eliminate consideration of the commercial condition of the various countries of the world when we are discussing economic matters relating to Canada.

I was very glad, Mr. Speaker, that the Government saw fit to have Canadian representatives at the Genoa Conference. We

have earned the right to be represented at these international conferences and we should always be found there. Perhaps we cannot exert the same influence that can be exerted by many other countries of the world. Though politically we may not be a nation, economically we are, and we have a right to 'be heard in the councils of the world as loudly and persistently as our rights and interests demand.

The Minister of Finance, in his budget, referred to the question of reciprocity with the United States. I speak of the matter only for the purpose of making one suggestion. I am sure that this Parliament, or the people of this country, did not and will not object to the visit of the Minister of Finance to Washington very shortly after his accession to office. Any efforts made by the Government to facilitate trade relations between Canada and the United States, particularly at the present moment, cannot but meet with commendation from all reflecting people in this country. It is true we cannot criticise the actions of the legislation of the United States in respect to commercial matters, tariffs, and things of that kind, but we cannot be prevented from expressing our surprise that in that

regard that country does legislate in the way that it does. We cannot help expressing our surprise that they take the view that they do, particularly at the present time, of international trade. I say it is commendable that public men should de everything they can, when opportunity offers, to encourage closer and freer trading relations between Canada and the country to the south of us. Possibly we in this country hesitate to express as freely as we should our opinion of tariff legislation and other enactments of that kind enacted foy the United States Congress. That may be due to the fact that we have not any instrument to vocalize Canadian thought and ideas in regard to such matters, and I feel like suggesting that Canada should have a representative in the United States somewhat after the form of our High Commissioner in London, there to gfve expression to Canadian ideas and views with regard to the commercial relations between the two countries. Perhaps this might be a very much better and a more practical thing than having, as was suggested a year or two ago, a representative at Washington closely associated with the British Embassy and more in the nature of a diplomatic than a commercial representative. Any trade that is done between this country and the United States is done between the people of this country and the people of the United States-trading is not carried on by countries-and I would think there would be a splendid opportunity in the United States for such a representative of this country to represent our commercial interests, and in my judgment it might bring about very beneficial results. It was only a year or two ago that a delegation from Sheffield, England, appeared before one of the congressional committees on finance and brought to their attention the fact that a certain section of the American tariff then under consideration, if put into effect, would prevent Sheffield manufacturers from selling their wares in the United States. The delegation was well received by the committee, and with very practical results, because, my recollection is, the proposed tariff upon the particular articles in which the delegation were interested, never became operative, but was abandoned by reason of the representations then made.

Now, a few words as to business conditions in this country. Conditions here are not good, as has been stated time and again by other speakers. But our future

The Budget-Mr. A. K. Maclean

is not without hope. There is one great distinction we should keep in mind as between this country and the European countries which are in distress to-day, and it is this. We are a very large country with a very small population. We have the capacity to expand. There is the opportunity to develop latent resources. There is room for millions and millions of people yet in this country. These two facts alone should give us great hope. Our problems are great, but they can be overcome, and they will be overcome, and that brings me to say just a word about immigration, which has been discussed by a number of speakers during this debate.

We generally agree that we require immigration into Canada. .Some desire a restricted and selected immigration. I merely refer to this for the purpose of expressing my own personal view, and it is this: We must not be too particular

about the class of people who come to this country. I want to be understood: we cannot be too discriminatory. There is work to be done in this country and it would be impossible, unwise, and not in the interest of the country, present and future, to say that all of our immigrants should be handpicked. The degree of our growth will very largely depend upon the numbers in which immigrants come to this country in the next few years, and it is the next few years which are the very important and serious ones for us. I want to express my personal opinion only, that any immigration policy that is adopted should not be too restrictive or selective. We must take the longer view. This country will take decades and centuries to fully develop. It took many thousands of years for the British Isles to develop the stock of people who inhabit it to-day, and it would be very difficult indeed to trace their origin through all the ages that are gone. Time in its ceaseless flight works many ethnic changes in the different races which inhabit any country, and so I say we must always have the longer, rather than the shorter view in such great questions.

We have other problems in this country, Mr. Speaker, and one which must always be present to the minds of hon. gentlemen is that^ Canada is a very difficult country to govern. My friend the member for Cumberland (Mr. Logan) referred to this the other night. We have a very extensive country, extending from coast to coast, with adverse interests, or rather with a lack of community of interests, at least

in a great many respects. We must endeavour to reconcile these adverse and opposing interests by public policy which is fair and just to the whole country. I wish as briefly as I can to refer to the different sections of the country which constitute Canada, and to point out as I pass along, the difficulties and disadvantages under which some of them live.

Starting in the East, I might well take my native province as being typical of the maritime provinces. There I find that the commercial relations of the maritime provinces with the rest of Canada are not very intimate. There is not a close commercial connection. Economically we are apart. Nova Scotia produces fish, lumber, and some surplus agricultural products. It finds no market in Canada for that surplus. It cannot and never will. That surplus is produced for export and sale in foreign countries. In the line of minerals, we find a market in the province of Quebec for a considerable portion of our coal, but it reaches that market only under a very severe competition, and not by reason of any tariff. True, there is a market in portions of Canada for some of our steel products, but it is also a fact, in my judgment, that that industry will never develop to its true and proper proportions from what might be called a purely Canadian trade. Therefore, I say that our interests are not bound up wholly with Canadian trade. In fact, our true destiny is involved in trade relations with the world; in other words, with international trade. It can be said, therefore, that the maritime provinces are little interested, as compared with other sections of Canada, in the policy of tariff protection. We have not the same possible advantages from that policy as have other provinces of Canada, and this must be kept in mind more in the future than it has been in the past. The maritime provinces have practically not grown at all in population

4 p.m. in the last quarter of a century, and they are rapidly becoming conscious of that fact. They are giving expression to the idea that economically their position is not what it should be, and I would say to those who shall be identified with public affairs in this country in the future that they will 'have to take cognizance of the fact, that in the maritime provinces our development will depend altogether upon international trade. Our traditions are all that way, and our destiny points in that direction. At the same time, it

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is only fair that I should say for the people of my province that they are not objecting to the federation of the provinces, and they are willing to hear some of the commercial disadvantages of the union,. But I say also that they will insist more and more in the future, as years go by, that a more careful consideration be extended to them, by reason of their commercial isolation from the great populous centres of the rest of the country, a condition which, I think can never be changed by any fiscal policy or programme which this country can adopt.

We come then to the larger and more populous provinces of Ontario and Quebete, where we find, I think, more than half of the population of the country to-day. We have in those provinces greater industrial development; practically the whole of the industrial development of this country is to be found in those provinces. I do not think that it has been brought about by tariff policy only. Usually, the expansion of one district more than another is due to conditions which that district inherently possesses. One would expect to see the commercial metropolis of Canada just where it is. I hope I am not offensive to any other city in Canada in saying that. The city of Montreal is to-day situated where lake meets river and river meets lake. Her geographical position is a commanding one, and her future is assured, regardless of economic policy and1 any other consideration. She is also indebted for her development to her splendid people. Even at this day, and even at this present moment, that province seems to attract industry which might be located elsewhere, but, for somle reason they prefer location in that province in preference to another. At any rate, Mr. Speaker, it is true that, in the provinces of Ontario and Quebec, we find a community of interests. The public policy, and the taxation policy, which might suit one very probably would suit the other, and, in so far as these two provinces are concerned, constituting a very large portion of this country as they do, and having more than half of its population, they have not the same commercial disadvantages that other provinces have. There are no differences between these provinces caused by existing public policy to compose, such as we find in other sections of Canada. Yet, these two provinces must remember that they have not themselves alone developed their provinces. The maritime provinces are the markets of the provinces of Ontario an'l

Quebec. Goods are distributed from that section of the country to the maritime provinces. We are their consumers, just as much as the people living in those provinces, and, by reason of that fact, I say that, while they have done very much for themselves, and while public policy may favour them very much, still much of their progress is due to the fact that conditions give them good markets in the sections of Canada east and west of them.

Next we come to the prairie provinces, so miuch talked of these days, largely because there are, in this House, many men to talk for them, and by reason of the conditions which prevail there. That section of the country is of great interest to Canada. They are a large exporting country, and that is of great importance to the people of the other sections of Canada. The exports of the prairie provinces assist to a considerable extent the imports of the industrial sections of Ontario and Quebec, which sections must import, in large quantities, raw materials from other countries-their cotton factories must, of necessity, import the raw cotton, their woollen factories must import wool from abroad, the rubber industries must imfport raw rubber, and so on; and there would be no way of paying for these importations, if there were not exports from these provinces or some other parts of the country. In that respect, we are interested in the West. There is a peculiar situation there. It may be over-accentuated by its citizens. The conditions there, which are very seriously adverse to-day, may possibly be exaggerated.

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PRO

Oliver Robert Gould

Progressive

Mr. GOULD:

No chance!

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN (Halifax) :

Well, there is a chance. There is always a chance for anything. I am rather preparing myself for a consideration of that particular matter. That section of the country is engaged in producing things which find a sale in international markets, and the price which they receive for their production is the price fixed in the international markets. The things they buy, as hon. members opposite assert, are bought largely in this country under the protective tariff, which, in some degree, at least, adds to the cost. They are far from the seaboard. Hon. members opposite who belong to these provinces frequently protest against this condition of affairs. There is much in their contention, I admit-a great deal, perhaps- and that, doubtless, has been accentuated by reason of the unusual commercial de-

The Budget-Mr. A. K. Maclean

pression existing throughout Canada today and even the whole world. We are all much interested in the development of the prairies provinces. Our hope, for the near future, at least, lies in the degree of development which takes place in that section of Canada. From 1900 to 1910 was the period in which the whole of Canada developed. There is no other decade comparable to it in our history, and I was very much impressed with this a few hours ago, when I was looking at the census returns for those four provinces. I found that in 1891 there were only 152,000 people in Manitoba; in 1911 there were 455,000, and in 1921, 610,000. There was no census taken of Saskatchewan and Alberta in 1891- they were then organized territories-but in 1901 Saskatchewan had 91,000, in 1911 she had 492,000 and in 1921 she had 757,000. Alberta had but 73,000 in 1901, 374,000 in 1911, and 568,000 in 1921. British Columbia had but 98,000 in 1891, 178,000 in 1901, 392,000 in 1911, and 521,000 in 1921. Now this represents a great development and growth.

Perhaps only an exposure of these figures would bring home to us this very important fact. During that period when immigration was coming into this country, there was, as 1 said before, a great expansion of business throughout Canada. It was that immigration which developed Ontario and Quebec industrially so much, because we were practically adding every year to the population of 'Canada, a number almost equal to our smaller provinces. That incoming population had to be transported, clothed, fed; it was that which led to the extension of our railroad system; it was that which gave impetus to the industrial life of Canada. The industrial development did not bring into the country the new population, but the immigration brought the development. Therefore, it follows that anything that can bring about a return of a corresponding development in those three prairie provinces, or in the four western provinces, is a consummation devoutly to be wished. Any public policy which can do that will command the 'support of the intelligent and reflecting people of this country, and our problem is to find that policy. Business in the West is unfortunately depressed to-day; but our western friends must remember that the same conditions prevail in other sections of Canada. The agriculturists faced deflation first of all the producers on this continent. In 1920, their productions fell to pre-war prices, while the

things they had to buy remained inflated. That produced the condition and the result which we have to-day in the West. The same thing occurred in the United States; it occurred in some countries of Europe, and I do not know of any public policy that could be enunciated by public men or governments that could have prevented it.

It has been said by someone, I forget whom, that the West will never become a manufacturing country. I can hardly concur in that idea. I do not know that it is very important to determine the fact one way or the other; but to some extent there is manufacturing there at the present time. It is almost impossible to conceive of a province, having the great resources say, of Alberta, not becoming more or less industrialised sometime in the future,-perhaps it may be said, in the remote future. I was sorry to hear a very excellent speech delivered by the hon. member for Springfield (Mr. Hoey) a few days ago, detracted from, I thought, just in its last moments, by a painting of the future of those provinces. He was reading from a survey made of Manitoba by somebody, in which survey the writer intimated that the wheat yield per acre in Manitoba was falling; and the future was painted in dark colours. It is not necessary for anybody to make a survey in order to come to that conclusion. That is a fact known to the ancients as well as to moderns. You cannot have an omelet without breaking an egg, you cannot grow anything from the soil without extracting the fertility; and the only way of perpetuating production is by returning to the soil, by artificial means, if you will, the fertility which has been taken from it. The West will grow no matter what government is in office in this country, and no matter what be the nature of the public policy that may prevail. Immigration has ceased; but it will not be long before we hear the West crying to send them men to "match their mountains and men to match their plains" as in years gone by. Nevertheless I have sympathy, and I 'believe every one in this country has sympathy for the agriculturists who reside in the prairie provinces over the conditions now prevailing there. The point, however, which I wish to place before hon. gentlemen for their serious consideration is the fact, that in that section of Canada you have a tremendous area and a very large population, engaged largely in one industry, whose interests are not identical with the interests of the

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rest of Canada, and it is not unnatural that from time to time we hear well considered and persistent complaints against public policy prevailing-perhaps with success-in other sections of the country, but which policy they ibelieve is unsuitable for their conditions. I mention that only again to present the thought that this is a /ery difficult country to govern.

In the province of British Columbia, the last province of the Dominion, we find the situation much as it prevails in my province. It is far removed from populous centres, and is separated from the prairie provinces by mountain ranges. The people of British Columbia naturally expect a market for their productions in the prairie provinces, but the value of that market to them depends very largely upon the success which the people of the prairies have each year in their agricultural pursuits. That market is variable and transportation charges, they allege, are unfavourable for the development of that market. That market besides is shared in by the East. The major portion of the productions of British Columbia find a market in foreign countries. If British Columbia develops to any great extent-and I believe it will in the future-it will be because it has become an exporting country. Its destiny to a very large degree is out upon the seas, and the future interests of the people of British Columbia are closely connected with the countries of the Orient and the Antipodes. If the harbours of British Columbia are to develop as great shipping ports-and I believe they will-that will depend entirely upon international trade, because a port will never develop unless there are imports and exports for ships to carry as inward and outward cargoes.

That is a rough picture of this country, and it shows how much in conflict are the interests of the various sections of this wide-flung young nation. Little wonder is it that it is difficult to govern. Little wonder is it that we find it difficult to compose the inevitable differences of these different sections of Canada. But, at any rate, these differences call for the best attention and consideration of Parliament and of the public men of this country, and only in a spirit of compromise is it possible to pursue our national career with success, so that provinces shall march side by side in the development of the nation as a whole, and we may thus achieve our true destiny. Only in this manner is it possible for each province to secure the development which each deserves and to which each na-

turally aspires. It is only by a just consideration of the interest of each, that the whole confederation can work out its destiny and purpose.

Just a word or two more upon one phase which I have already discussed. What is one of the chief factors contributing to the depression of trade in this country to-day? It is desirable in discussing the present adverse conditions of the country, to understand, if we can, the actual causes of those conditions. If we do not know those causes and have not them clearly in our minds, we cannot intelligently discuss the effects. One of the causes contributing to the depression in domestic trade today, is the fact that the true equilibrium in the exchange values of commodities with commodities is wanting. Some hon. gentleman opposite remarked the other evening to the fact that he could not get more, I think, than a dollar for a hide, although he had to pay $12 for a pair of shoes; and after making that statement he asked the question: Where is the

nigger? Well, that question left the impression in my mind that that hon. gentleman was suspicious as to the existence of some sinister public policy and believed the whole cause of this particular condition to be easily ascertained, and to be capable of immediate remedy by public policy. One of the difficulties of trading in the world to-day is that goods do not exchange the one with the other upon a fair basis. That is true. The prices of some commodities are too high altogether in relation to other commodities. It prevents exchange, it destroys business. Now, you cannot long have wheat selling at $1 a bushel and flour at $10 a barrel; nor can you have leather or hides selling at low prices and boots and shoes at high prices. You cannot have cotton and wool almost unsaleable, or barely saleable, and cotton and woollen manufactured goods selling at high prices. One must go up and the other down or there will be disaster. It is impossible to have any sound commercial conditions when the primary products are low in price, and manufactured products abnormally high in price, and that is one of the present difficulties that confront agriculturists and producers of raw materials to-day. Wheat will not, for instance, buy for its producer a fair quantity of the goods of another producer. If this continues production will fall and prices will rise. The proper balance or equilibrium in the exchange values of goods with goods has been lost, and that it what we want to restore. But

The Budget-Mr. A. K. Maclean

how to restore it is the question and the problem. Now, there is only one suggestion that one can make, and that is that in the industries which have not yet deflated, the controllers or managers should do all they possibly can to bring about that deflation. We cannot have prosperity in this country with a deflation in primary products and continued inflated prices in manufactured goods. The true prices of commodities are the prices that will permit them to freely exchange with other commodities. The right level of wages, the economic level, is that standard which will give men employment, and which will permit wage to exchange with wage or commodity with commodity, which is the same thing, on a fair exchange basis. The Minister of Finance (Mr. Fielding) in his budget speech, in referring to the conditions between labour and capital, had in mind, I think, this idea -if he had not, then I wish to make the suggestion myself

that there is a great opportunity for the leaders of industry and the employees of industry to render a service to their country and to their fellow-citizens at the present time In coming to a proper understanding as to wages, labour conditions and production. I think they owe to the public and their fellow-countrymen the duty of doing everything they possibly can towards bringing about a deflation in the prices of manufactured and semi-manufactured goods, so that they may exchange on an economic basis with the primary products of the country. If they fail to bring about that condition, the present commercial depression will continue. And no absolute power rests in governments or in Parliament to bring about that condition; it can be facilitated at least in the way I have suggested.

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IND

William Charles Good

Independent Progressive

Mr. GOOD:

The hon. member has expressed the desire that the prices of manufactured products should go down, but he does not seem to understand how this Government can have any control over deflation. I want to ask him if it is not reasonable to suppose that by a reduction in the tariff on, say, shoes, we can force the Canadian manufacturer of shoes to deflate his prices, just as well as we can-and perhaps better-by asking him to deflate them of his own free will.

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN (Halifax) :

I had not in mind merely the manufacturers, but of course my remarks, perforce, must apply to that line of production. What I say, however, is this, that in all lines of indus-

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try where there has not been deflation it should be brought about, and I urge that those engaged in industry, or large labour employing concerns, should do everything possible to secure that end. Now, as my hon. friend from Brant (Mr. Good) suggests, it is possible that the tariff might be utilized as a factor in that directon. There might, however, be difficulties at the present time in using the tariff as a lever in the way suggested. Take free trade in England to-day, where practically no tariff exists, and you find the same conditions prevailing there, or at least they did in a very marked degree a few months ago. I have though in mind the factors which enter into the situation outside of tariffs. I am appealing to individuals and not to governments. Perhaps the situation is less acute to-day, but a few months ago in England there was an abnormal disparity between commodity prices, and the problem that had been engaging the thought of public men and business men of England more than tariffs or anything else, was how to re-establish a true equilibrium in prices as between commodities and the true relation between commodities and prices.

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PRO

Robert Forke

Progressive

Mr. FORKE:

Would the hon. member for Halifax assert that there is any comparison whatever between the spread in England and in Canada to-day as between the price of wool and the prices of woollen goods? Does he contend that the two countries can be compared at all in this respect?

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN (Halifax) :

I am not in a position to give an intelligent answer to my hon. friend offhand, but if the spread is not so great in England I am glad to know it, and perhaps I shall satisfy the hon. member by expressing the hope that the spread will diminish gradually in this country.

Now, Mr. Speaker, I must hasten to a close, as my remarks have extended far beyond the length I had intended. Before I resume my seat, however, I just wish to refer briefly to the amendment before the House. The amendment moved by the hon. member for York (Sir Henry Drayton) suggests failure on the part of the Government to implement its pledges; and the Progressive amendment, which was ruled out of order, contained a suggestion of the very same nature, and also stated that the principle of protection as a basis for a fiscal policy is not in the best interests of the country. I have been unable to see any practical good or any useful public purpose

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to be served by the amendment of the member for York. He seeks to enact a new political decalogue by moving his amendment to the budget.

Now, Mr. Speaker, I was not at the Liberal convention of 1919, for very good reasons-

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LIB

Andrew Ross McMaster

Liberal

Mr. McMASTER:

And to our great regret.

Mr. MACLEAN (Halifax) and had I presented myself there in the flesh I might have had some doubt as to the cordiality of my reception.

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LIB

Andrew Ross McMaster

Liberal

Mr. McMASTER:

No, no, not the slightest.

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN (Halifax) :

But at any rate the convention proceeded without me and my absence mattered nothing. I agree with the general statement that political parties should live up to their public professions and their commitments as to policy. At the same time I think political parties should exercise very great care in giving pledges to the public but we must be practical in these matters. I have been in public life long enough to realize that it is better to be practical than theoretical about such matters. Party government is inevitable, but after all, though it is not the reign of saints, there is just as much morality and courage and adherence to principle in the world of parliament as in the world outside.

Not having been present when the Liberal platform of 1919 was being constructed, I may perhaps be allowed to stand off at a little distance and with no impropriety make some remarks concerning that platform. In my judgment political conventions-and they are a necessity at times- should only commit themselves to principles. Had I been present at that convention I would have protested, although perhaps without effect, against the designation of specific articles to be put upon the free list; the fixing exactly of rates of duties, in other words, I would have objected to a party convention attempting to do what should be left to the people's representatives in Parliament, that is, to carry out public policy in detail. I think everyone will agree with me in that. The Progressive party adopted a policy after the same fashion. I think that they also made a mistake, and I have not the slightest doubt that if I could take hon. gentlemen opposite beyond the green doors yon-

der one by one and put the question to them, they would say that it was a mistake for a political party in convention to commit itself to the details of public policy. I do not say that some of the articles mentioned in the Liberal platform or in the Progressive platform might not without disadvantage to any section of the community be placed upon the free list; but I do say that it is better for party conventions to declare themselves upon general principles, and leave to the people's representatives in Parliament the duty of saying how principles are to be worked out in their details.

I have never yet been able to understand why some people think it is so easy to revise a tariff vertically. I can understand its treatment horizontally, because then the action taken relates to whole classes of commodities and proper relationships are not destroyed. I am not saying that specific articles cannot be treated by themselves; I merely wish to suggest for the consideration of hon. gentlemen that once a country commits itself to the principle of protective tariffs, you rear a tariff structure of considerable complexity, and it is not as easy to take some timbers out of that structure as certain hon. gentlemen think. Further, you cannot always be sure that you get the best results in that way for the public generally. However, these remarks do not do away with the Liberal platform.

The present Prime Minister (Mr. Mackenzie King), when addressing the Liberal convention which nominated him as leader of his party, expressed the view that he would take the adopted platform as the chart and compass of the Liberal party. He was just putting out on the political sea, and I suppose it was only natural that he should employ nautical terms to express his ideas. I think he showed a good deal of pre-vision and political sagacity in making that statement. He is not in the position that he can be charged with having sought a variation of the party policy at a time subsequent to the convention, because his statement synchronized practically with his nomination as leader, and therefore I do not think he is open to criticism on that account. He expressed the thought and his adherents had in mind the idea that the tariff resolution contained within it a principle which was the essential matter and not the details of it nor the complexities of working it out.

And, during the campaign, I think, the Prime Minister's public utterances were consistent with the view which he ex-<

The Budget-Mr. A. K. Maclean

pressed at the convention. The tariff changes which the Minister of Finance has brought down are not inconsistent in the vital principles with the Liberal platform of 1919. At least no one can argue that the compass is not pointing in the direction indicated by that convention.

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?

An hon. MEMBER:

It is only a flicker.

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN:

At any rate the reductions made in the tariff indicate that the compass is pointing in the right direction. Had there been increases there might have been some justification for the criticism of the Liberal party and its leader, which has been made by hon. gentlemen directly opposite me. It must be remembered that the revision of a tariff which has in it the elements of protection is not a very easy task to accomplish, particularly at this time. If hon. gentlemen of the Progressive party were placed upon the ministerial benches to-morrow, they have admitted collectively, and many of them individually, that they could not abandon the tariff at once. So far all the differences in opinion is one of degree. The Government has been in office barely five months, and it does not seem to me quite fair to demand that in that short time they give full expression to what some sections of the country or certain individuals think should be done in the way of tariff revision. That would be too much to expect of any government, and particularly of any Minister of Finance, considering the short time which has elapsed since he and his colleagues came into office. I do not think that the practical people of this country can in justice claim that any extensive revision of the tariff could be expected at the present session. It is not a very easy matter to-day, considering the great confusion in trade and commerce the world over, to revise our tariff and know exactly what the effect of that revision will be. As I said at the opening of my remarks, it is difficult to see the incidence of taxation as proposed by the resolutions of the Minister of Finance. To-day, to-morrow, or the next day, he may ascertain that the effects of his amended resolutions are not what he expected them to be, and it is difficult to approximate or estimate the effects of fiscal policy or of public policy generally upon the world activities to-day, largely because of the political and economic confusion which prevails the world over.

The discussion of the amendments has brought forth the usual amount of talk about protection and free trade. I am inclined to think that too many people make a fetish of each of these theories of trade. For myself, I do not regard one as a virtue and the other as a sin. The hon. member for Brome (Mr. McMaster) remarks that he does think that one is a virtue and the other a vice. In principle one may be sound and the other unsound; I will go that far with my hon. friend. It is true that a protective tariff may help some people and hurt others. It is also true that there is a difference of opinion in this country upon the effect of tariffs. As I pointed out in the earlier part of my remarks, in some sections of this country you will find public opinion strongly in favour of protection. In my province you will find some support for the principle of protection, but on the other hand the majority I believe do not look for any great development that province in the future as a result of the adoption of the principle of protection. In fact, I will go so far as to say that I do not think it can be hoped that my province can be developed under a protective policy. At the same time as a part of the Confederation we must submit to the law in this regard as established by the majority. The minority cannot get just what they want in respect of tariffs or in respect of anything else; neither can the majority for that matter, because their demands are reduced as the result of opposition, and in the end, by compromise. I appreciate the fact that there is something to be said in some countries for the policy of protection, though I would not concur in it as a principle. Whether one believes in it or not, it is nevertheless a fact that in a young country which is without capital, large population, industrial experience or foreign markets, there is a desire to have diversity of industry so as to give scope to the imagination, the intelligence and the enterprise of its people. Whether right or wrong, that idea will exist in any new country, and it exists in this country, even in our western provinces. After all, protection is state aid; it is the doing of something to help some people at the expense of others, there is no doubt about that. If it did not do that, it would not be protection and nobody would want it. Very few protectionists to-day deny that. In my earlier days in political life every exponent of protection denied that the tariff exaction meant any increase in the price of commodities to consumers, but that is admitted to-day. Now,

2872 COMMONS

The Budget-Mr. A. K. Maclean

if the people of a country, in order to bring about diversification of industry or for any other reason, adopt tariffs as a national policy, it is there, and once adopted it cannot be got rid of in a moment. We all agree to that,

Progressives, Liberals and Conservatives alike. We all agree also, I think, that free trade is not a possible public policy in this country to-day. Not a single hon. member of this House, so far as I know, has given expression to that view. In fact, many members of the party directly opposite me, the chief exponents of low tariff in this Parliament, have stated time and time again during the past few weeks that we cannot now have free trade in this country. So therefore that is not in issue. The war has settled the matter; this country cannot for many years to come have free trade as they have it in England. We will require a tariff for revenue purposes at least, because it will not be possible for the Government to get in any other way the revenues which it requires. We have not accumulated reserves of wealth in this country from which we can get the needed revenue. We are young in development; there has been no great national saving as yet which could be the source of sufficient revenue for the nation's needs through an income tax.

I confess that one reason why I have not been antagonistic to the idea of a tariff in this country is the fact that the great nation to the south of us have always put up against us exceedingly high tariffs, frequently to prevent fair trade between Canada and the United States, -at least, I have got that impression. I am not going so far as to say that it is economically sound for us to give heed to the tariff legislation of the United States. If free trade theoretically is right, I suppose in the end we might disregard the actions of that country from time to time in respect of tariffs. But every practical man must admit that to take down the Canadian tariff and leave this country open to the American producer would bring about so sudden a change in the economic life of Canada that consequences would ensue which might be quite disastrous in their character. As to that, one cannot tell; but I think I express the view of this country as a whole-of protectionists, free traders, and fair traders-that in the circumstances, in view of our geographical relation to the United States, in view of the tariff policy of that country, frequent-

ly designed against us, we cannot embark upon a policy of free trade here. I doubt if in the ranks of hon. gentlemen opposite or in any other section of this country you could find a very substantial body of opinion to the effect that we should go so far in that direction as to leave the Canadian market absolutely open to American productions, and to place this country in such a position that she would have at her disposal no economic weapon to employ in dealing with a country whose tariff legislation is not, we feel, always wise from their own standpoint, or fair and favourable to us from the viewpoint of our material interests. I should, however, like to see freer trade relations between the two countries.

Now, I have taken some time to give to the House a rough idea of the varying economic interests of the different sections of Canada. I think it is fair to say that in the circumstances a compromise upon fiscal policy as between those different sections of the country is inevitable. I trust that some common ground can be worked out, fairly acceptable to all.

I have inot the slightest doubt, Mr. Speaker, as the leader of the Progressive party (Mr. Crerar) intimated when speaking in this debate, that the thought of the world to-day is in the direction of lower tariffs. I think that is true of the United States. You cannot read the utterances of their princes of commerce, their leading merchants, bankers and economists, their boards of trade and chambers of commerce, during the last few months in the eastern part of the United States, where the Republican party has always been strong, without reaching the conclusion that the leaders of thought in the United States believe in the reduction of tariffs in that country, and that hereafter she must give more liberty and freedom to the importation of foreign products.

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CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

Is the hon. member able

to point his finger to one single leader of public opinion in the political world of the United States who has come out and avowed himself in favour of a lower tariff?

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN (Halifax):

I do not

know that I could mention the name of a political leader in the United States whose views upon the tariff issue I could quote to my hon. friend. I am sure that I would be very much impressed one way or the other with the opinions of political leaders in the United States, because, the actions

The Budget-Mr. A. K. Maclean

of a majority of them at least in recent days would not indicate to me that their viewpoint was sound. I can say this, however, that the dominant note in the industrial, commercial and financial life of the eastern section of the United States to-day is in the direction of lower tariffs. And of necessity that must he. The commerce of the United States is depressed to-day. Why? Because she is not exporting the surpluses which she is producing. How does that happen? Because she is not importing goods. She cannot expect other countries to buy goods of her unless she buys goods of them; there is no other way, which human beir js know of to pay for goods except by goods. Money is not a factor in it at all. Gold may be used, it is true, in the settlement of small international balances, but large international balances as a rule cannot be settled in gold, and then you have a depreciation in currency. We could not settle one hundred dollars worth of international adverse trade in gold, because we haven't got it. What little we have cannot be exported. The United States is a great creditor nation, and they cannot export unless they import, and they cannot live, economically, in the future unless they import very much more largely than they have been doing in the past.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

Is Canada a great

creditor nation as the hon. member has described the United States to be?

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LIB

Alexander Kenneth Maclean

Liberal

Mr. MACLEAN (Halifax) :

No.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

Then does not the

hon. member's argument apply in the reverse ?

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June 13, 1922