April 7, 1925


On the Orders of the Day:


LAB

William Irvine

Labour

Mr. WILLIAM IRVINE (East Calgary):

May I ask whether the old age pensions bill is ready for presentation to the House?

Topic:   OLD AGE PENSIONS
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LIB

James Murdock (Minister of Labour)

Liberal

Hon. JAMES MURDOCK (Minister of Labour):

The hon. gentleman will note that there is on the order paper, under Government Notices of Motions, a resolution that is to come before the House as soon as we-get the present business out of the way.

The Budget-Mr. Mackinrwn

Topic:   OLD AGE PENSIONS
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THE BUDGET

CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE


The House resumed from Monday, April 6, consideration of the motion of Hon. J. A. Robb (Acting Minister of Finance) that Mr. Speaker do now leave the chair for the House to go into committee of Ways and Means, and the proposed amendment thereto of Sir Henry Drayton


LIB

Donald Alexander Mackinnon

Liberal

Mr. D. A. MACKINNON (Queens):

Mr. Speaker, the problem of finance is always an important one in Canada, and it is getting more complex as the amounts involved become increasingly larger than those of olden times. I think the proposal of the minister who is chargeable with the finances of the country, having to do'with methods of obtaining revenue, is a very good one, namely, to have the assistance of a board of experts who will be able to take up the different items that compose the imports of the country, go into them carefully, and, if they are men of ability and experience in handling tariffs, come to sound and reasonable conclusions. Such men should not be hard to find. In fact, the minister no doubt has in his own department men of ability and experience, but the volume of the work has increased so much that I think it would pay the country well to have such a commission as is proposed by the minister.

I have taken the trouble to look into some of the items of import with a view to understanding the matter thoroughly. I examined the figures with respect to entries for horses and I found that in one case there were $9,000,000 and in another $99,000. It might be thought from these figures that horses could be taxed very heavily and that quite a revenue could thus be provided, but I found upon investigation that most of these horses came in only temporarily, for exhibition purposes and for races, and had gone out of the country afterwards. In fact, the $99,000 was represented by only 123 horses, so that it would not be possible to obtain much of a revenue from an item like that. I mention this only to emphasize the fact that if a commission of, say, three men go into these matters item by item they will know where to recommend an increase and where to recommend a decrease in the duty without resulting disadvantage to any part of the country.

We may have different ideas. There is a school of thought very strongly for free trade, and there is a school of thought very strongly

for protection. We have these two schools, and they are both entitled to their opinion. If the school for protection had had their way last year and had made the duties very high, so that we would have had, say, $100,000,000 of a surplus last year due to protection, it would of course be a great thing to reduce the public debt by that amount, but that burden would have had to come on the people in some way or other, and I think they are not able to stand $100,000,000 more being taken from them through higher tariff duties at the present time. But this board could consider, for instance, the question whether it would be advisable to have free trade within the empire, and propositions of that kind which might help us a great deal in working together. It might take up the proposition whether the tariff should be increased in any one item or another, or reduced. They could take up all these questions and advise the minister and the government on the matter. I need not say anything more on that subject. I think it is a good idea to have this board appointed, for it is a killing business for the Minister of Finance to undertake all this work alone as the head of the department, and we could not long expect to get good men to undertake all this work if the entire burden was left on their shoulders.

I think the Acting Minister of Finance (Mr. Robb) is also entitled to a great deal of credit in connection with the handling of some of these loans. He had made a saving of 82,500,000 in interest in the loans he has floated, and I think he is to be commended for that. I observe, however, that the loans are floated for short periods, some for so many months, and some for so many years. I would submit with all respect that in Canada to-day, or as soon after this as we can do, a loan of $1,000,000,000 at 3-J per cent should be floated for a term of fifty or sixty years. I think that loan would be taken up. A loan of that kind over a long period would shift the burden, as only the immediate interest would have to paid and there would be a provision for repayment of the principal of the loan in half that period, if need be; but I think we should look ahead and have a long-term loan made by our Finance department in Canada. I think it would be a great help to this country. We are now paying a large amount of interest on our loans, and it is too much for the country to do that and to keep the other necessary works of the country well in hand. In floating a loan like that, it may be a little difficult to find the money, and it will be more difficult still if we go round decrying the country.

The Budget-Mr. Mackinnon

Canada, is destined to be a great country and, I think, is fundamentally sound, if you compare our situation with that of the other nations of the world. Canada is no longer the small colony she was a few years ago. She stands to-day-such was the statement made by a noted man who is well up in finance-seventh amongst the nations of the world in wealth. I think his estimate was put at twenty-two billions of dollars. That is a very good standing for this country amongst the nations of the world, when we have been a nation for only fifty or sixty years. The wealth of the country is the first thing I look at, for in floating a large loan over a long period the wealth of the country would need to be looked into. During the past year we have heard people saying that the country is going back, that business is going back. Let us look at the trade of the country during the past year. I think you will find there is an increase in the totai trade of about $205,000,000 over the year before, and of about $450,000,000 over the year before that. That is very satisfactory. It does not show the country is going back if the trade is increasing. Our trade is up now to almost two billions of dollars, and a country that is doing two billion dollars of trade is no mean country. It is a great country, and it is a country we should do our utmost to clear the way for so that it will advance in commerce more rapidly and more clear of the difficulties which are in the way to-day, and to which I am going to refer a little later. Our imports and exports amount in round figures to $1,900,000,000, or almost $2,000,000,000. It is, I think, very gratifying that our trade should amount to such an immense sum. Not only that, but look at the different places where we carry on trade. We look first to our neighbours across the line, the United States. Some people do not like to deal there. I have heard some speakers express the view that they live within themselves over there. President Coolidge has said that they could produce enough within the country itself for their own needs. But that is a very selfish and limited life. We are going in for a larger life in this northern country, if that is their idea in the United States. If you look at what our people are doing to-day, and have been doing in the past year, you will find' that we are dealing not only with the United States but with all the different parts of the world, with China, Japan, the countries beyond the South Sea Islands, with every continent, with Asia, Africa, and South America as well as Europe. It is wonderful the way our trade has ex-

panded.' I think it is a great proof of the shrewdness and ability of the business men of Canada. And the work of these business men .is being helped to its utmost by the Minister of Trade and Commerce in this government.

Now look at our trade with the United States. I look upon them as a very fine people to trade with. Canada did break their windows at one time, about 1911, when they looked through for reciprocal trade, and I think by their Fordney-McCumber bill they retaliated and put their tariff a little bit higher than they might otherwise have done. You find that three and a half millions of the people across the line are Canadians or descendants of Canadians. I saw a precise statement as to the number some time ago, and I think it wonderful that so many of our people should be over there. They hire good people to deal with, and they have not gone over there within the last year, but they have been going over continually ever since that country became a republic. The statement of which I have spoken gave the numbers of the people coming into the United States from all the countries outside, from Japan and the different countries in Europe. The people over there are our nearest and friendliest people to deal with, not only the American-Canadians but the Americans themselves. They are sympathetic in their dealings with us, and we are dealing with them to the extent of about one-half our foreign trade, to the amount of almost one billion dollars. We should do everything to make that trade grow. We should do everything to maintain fair and reasonable relations with them. We should take care that everything we send them is of the best workmanship, the very best our manufacturers can put up. We do not want shoes or boots to go across the line with their heels made of paper, as I heard one man down the street say the heels of a pair of Canadian boots he purchased the other day were.

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE:

They were not made in Quebec.

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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LIB

Donald Alexander Mackinnon

Liberal

Mr. MACKINNON:

They were made in Ottawa, I think. That is not the sort of thing that Canada wants. In addition to this importing and exporting business, the workmanship is a thing we should1 look after. Everything we make should be as perfect as it can be made. We should have the very best leather, and the boots and shoes we make and everything we send abroad should be of the very best workmanship, for you can send an article with a good name into the markets cf the world, I care not to what part of the

The Budget-Mr. Mackinnon

world you send it, and you will get a good price for it and carry on a good trade there.

If we look at the other nations we have been dealing with, we find that about $664,000,000 of our trade is with the empire, with the different dominions and Great Britain. This is over half our trade with the United States. We carry on trade amounting to about six hundred and sixty-four millions. I think it is a good thing to promote that trade as much as we can; it will develop among us a spirit of co-operation and if we develop each other's trade it mil be a splendid thing for the empire as a whole. France, Belgium and Germany do a trade with us of over

320,000,000. We also find that a large trade 'S developing between Japan and this country. I think we should have sympathy for the Japanese who have experienced such tremendous losses by earthquakes; we should feel glad that they are reanimated and are continuing to do business with this country in such a satisfactory way and with such good results.

I feel very much surprised at the action of the Mother Country in putting into force an embargo upon the export of potatoes from this country to Great Britain. I was going to say that I almost feel ashamed of the Mother Country in view of the reason for this embargo,-the presence of the Colorado beetle. Why, for fifty years the Colorado beetle has been after the potato plant and the remedy used against it is Paris green. I repeat that for fifty years the Colorado beetle has been extending its territory, and yet because of this pest, the Old Country is to-day placing this embargo against potatoes from the United States and Canada. The embargo comes at an inopportune time for us because our people have entered, in a systematic and scientific way, upon the development of the potato trade. During the past year millions of bushels of potatoes of the best quality were shipped from the Maritime provinces to outside markets, such splendid varieties as the Irish Cobbler and the Green Mountain. They were highly apreciated wherever sold and very appreciative notices appeared in the public press in London with respect to them. To show you the excellent quality of our potatoes, demands are made by Virginia upon our province for seed potatoes. The growers there buy about half a million bushels for planting. And here is an extraordinary thing that occurs: I go to Toronto and I find the people there buying the potatoes from Virginia produced from the seed we send down from Prince Edward Inland. It is an illustration of the curious route that trade sometimes follows.

For the Mother Country to adopt such a strange course with respect to Canada is verv surprising, personally I am at a loss to understand it. The Colorado beetle is not found on the potatoes that go to England. The pest lodges on the plants; it does not stay on the potato itself, and the plants are not shipped to England. If the bug remains on the potato top what happens to the potato? It does not develop at all, and we get no potatoes. Some of the growers in our province have eighteen to twenty acres given up to potatoes; some of them as many as eighty acres. As soon as the bug appears on the plant Paris green is liberally used and the pest is destroyed. Then the plant has a chance to grow and produces a healthy and well developed potato. During the past year I saw many acres of potatoes in Prince Edward Island covered with vigorous and healthy plants without any sign of disease. These potato fields are all carefully inspected by inspectors sent down by the Department of Agriculture. Last year when those inspections were made everything was found to be all right, and shipments made to the Mother Country were consequently free from the Colorado beetle. I have looked into this matter somewhat. I found in the Parliamentary Library a work by an expert in Paris dealing with potato diseases. This work was published in 1923 in French, but I took the liberty of translating it for myself. According to this authority there are 150 species of potato bugs in Europe to-day and not simply one species, the Colorado beetle. When I read that I was more than surprised and felt that the Mother Country was not treating us quite nicely. Great Britain is importing potatoes from other countries in Europe where the potato bug exists, and yet she has blocked our trade in potatoes on the ground of the prevalence of the Colorado beetle. I can see no reasonable excuse for this action on the part of the Mother Country. I do find some excuse for the United States because that country put an embargo on shipment of potatoes from Ireland as far back as 1909. The latter country was shipping potatoes to the United States and competing successfully with the American growers. However, we shall be inspired by this experience to turn to other markets and it may have the result of developing greater initiative amongst us. Never-the less it has been a costly experience during the past year. That is about all I have got to say with respect to the embargo. I speak upon this question with a great deal of feeling because I did not look for this treatment by our own kith and kin, toward those

The Budget-Mr. Mackinnon

who have been struggling to make a living after their European experiences.

One of the other questions which greatly affects our prosperity is that of transportation. I take it as an axiom that neither Canada nor any other country can prosper without cheap transportation. When I came up here in 1922 I did my best with the Minister of Railways to secure better treatment. He referred me to Mr. Hanna who at that time was at the head of the management of the National railways. He took up the matter with other officials but for some months no headway whatsoever was made with the matter. I do not say this for the purpose of censuring Mr. Hanna; he was a great financier and was devoting himself to making the railways pay. Later on, Mr. Dalrymple, who was in charge of freight matters for the Canadian National Railways under Sir Henry Thornton took action in the matter and we had reductions made. Some of you perhaps have heard of the appeal "Have a heart, Maggie" addressed to the old lady when she was spilling the beer in the coal scuttle. I think, perhaps, Sir Henry Thornton is of a sympathetic disposition. He has a heart and if he carries that feeling with him it greatly helps in the treatment of difficult questions. I think he has been managing the National railways in a very creditable manner, and that those railways are now going ahead due to the earnest desire of the officials, who are strongly interested in the progress of the country and in seeing the National railways prosper. I am not criticizing those officials in the past who found it impossible to do anything for us. They held office at the time of a great crisis and perhaps it was impossible for them to pursue any other course. At the present time it is very gratifying to note that there is a favourable balance in the operating of the National railways for the past year of over $17,000,000. I hope it will be possible to reduce the transportation rates at a very early date and still manage the railways with success.

It has been urged that immigrants should be brought into the country, and the argument is that they would help to pay the railway debt of the country and other indebtedness. I count that as nonsense. I think it is a very foolish proposition to advance, and it is a peculiar proposition for any public man to discuss. The point is, can an immigrant live well here, and is the country worth living in and worth fighting for? If a man can come here and earn a livelihood, it is a good country to live in. We think it is as good as any country in the world. A man can get

along here on his merits. We do not want him to come in and bear the burden. We can shoulder our own burdens if it does take a long time to discharge them. We do not want people to come in for any such purpose; we want them to come in if they feel like coming, if not, we can get along without them. I desire to point out that from what I have observed, there is no doubt that a great many people have been going away from Canada. If we adopt a tariff as high as you like to make it, we would not prevent people leaving the country. But I think this is what persuaded them to leave. After the war, in the United States, there was a great fever for building. Hundreds of millions of dollars were expended throughout the United States in putting up buildings. For this purpose they obtained men from other countries. Men from Ottawa and from different parts of the country went to the States to work on buildings, putting roofs on buildings and so on. Many contractors and carpenters went down there. What took a great number of people from our country for a few years back was the expenditure of a large quantity of money which the government of the United States and the people of the United States had and it was used largely in the work of construction and in work and industries. Hundreds of millions were spent. But we find a change has taken place, and now many of the people are coming back to live in their own country. It strikes me that that is the reason for the great unrest and change which we have experienced. Matters became acute down in the Maritime provinces for this reason; when t'he tariff was imposed on our people and this National Policy was adopted, the people said: "Let this go through, we will try and get along if it is for the good of Canada." Some people say the same thing to-day. They say: "If you want an increase on this article of five per cent, or thirty per cent, all right; if it is for the good of Canada, we will suffer down here." That continued until conditions became acute. That policy centralized the factories and the capital, and then what occurred? If transportation had been cheap between the Maritime provinces and the central places where the factories were located, the trade would have gone on as usual, but when transportation became expensive we had to pay for the transportation of goods from the factories to the provinces, and the transportation of produce to other parts where it might be sold, and the condition in the Maritime provinces was rather acute. But the country is progressing. We have over a million people. We have industries

The Budget-Mr. Chaplin

in the three provinces that produce $135,000,000 and we are not very badly off. We can carry on more industry and if we were able to ship goods to places throughout the world, the Maritime provinces would be able to carry on as well as any other part of Canada. In agriculture the production of the Maritime provinces realizes about $88,000,000 and the fisheries about $14,000,000. They have a very good field there. I think the fishermen will appreciate the removal of the duty on gasoline engines. This change will help them, and they deserve it, because it will help to build up the fishing industry.

Dairying is carried on in those provinces on a splendid scale and I think the cattle produced there are of a very good class. The Minister of Agriculture (Mr. Motherwell) has been taking a great deal of interest in Prince Edward Island, and he has decided to assist the industry of dairying in that province and to establish accredited herds in a restricted area. I am glad he settled that matter. I hope the House will approve of his proposition when the matter comes up, because it is a small province and the number of cattle is not very large. When the cows are tested there it will improve conditions in that area, so that the island will become a most healthful spot. I think it is the greatest blessing the Minister of Agriculture could bestow on that island, because it will do a great deal towards improving the health of the people. Sheep raising also deserves special attention. There are 83 million fewer sheep in the world than before the war, so that this field for development is attractive. The other minister who is going to assist in the improvement of the island is the Minister of Justice.

We have more to do with the Minister of Public Works with regard to the construction of works down there. We have very few public works to be put through on the island, on account of the economy that is being practised. The Minister of Marine and Fisheries has a great deal to do in looking after the coast. I mention these matters specially on this account, in order to show that they are acting economically. If in any other branch of the public service the ministers were too lavish, the country of necessity would not prosper as it has been doing.

In closing I may say that I think that the material success of the country is not in such bad shape. We have a good deal of interest in it, and we would all like to see every man and woman in Canada in a prosperous state, no matter on which side of politics they might be. If every one would lead a comfortable life we would all be happy, and it is our duty

to do all we can to that end. We would like to progress, not only in our material interests, but in other respects. Hon. members must observe that in Canada we produce men of intellect, and their powers are not confined to our country alone. They are exercising an influence throughout the whole world in this way: that with the changes which are brought about we are going to see more daylight in the future, and what we -have to do is just to clear the way.

There's a fount about to stream,

There's a light about to beam,

There's a warmth about to glow,

There's a flower about to blow;

There's a midnight blackness changing into gray;

Men of thought and men of action, clear the way I

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. J. D. CHAPLIN (Lincoln):

I do not intend to follow throughout the speech of the hon. member for Queens (Mr. Mackinnon) who has just spoken. I find that he has been very moderate, and I concur in very much that he said. One thing, however, towards the close of his address caught my attention, and that was the fact that he had learned, owing to the treatment that he received at the hands of Sir Henry Thornton by way of reduced rates on potatoes, that Sir Henry Thornton had a heart. The people of Canada hope that Sir Henry Thornton has a heart. They call upon him to stop useless expenditure and the extravagance of establishing and paying a large staff in Paris. They ask him, along with this government, to practise more economy in the matter of transportation and to reduce costs, and by that means earn the approval of the people of this country. I am glad to know from the hon. member that Sir Henry Thornton has a heart. I think the people of the country will appreciate that very much. He might also cut out some of the useless expenditure on the radio and a whole lot more foolishness-the building of golf clubs all over the country, and foolishness of that kind. I call the attention of the Minister of Railways (Mr. Graham) to this matter. In common with other members of the House, I regret very much the absence of the Minister of Finance (Mr. Fielding) through illness. We think the country also regrets his absence. His guiding hand has been very much needed in this House, and there is no doubt that he has been missed more than ever during the presentation of the last two budgets. I intend to quote some of the last words uttered in this House on budget matters by the Minister of Finance. In 1922, as reported at page 2106 of Hansard, he said:

The Budget-Mr. Chaplin

The Grand Trunk and the Canadian Northern are now virtually owned by the Dominion of Canada, and when we advance money to them we are, in a sense, lending money to ourselves.

Again in 1922, as reported at page 2107 of Hansard, he said:

During the year four Canadian government loans have been floated. Three of these have been in the names of the railway companies and one a direct government obligation.

Continuing, as reported on the same page, he said:

We still keep up the theory of corporations in regard to these railways; the railway loans are issued in the names of the railway companies, with guarantees by the government. As a matter of fact, the government to-day are both makers and endorsers of those securities; so that practically they are now government loans.

Let me quote further. In Hansard of 1923, under the head of income and expenditures, as reported at page 2640, the minister said:

The revenue for the year was $381,952,286.99 against ordinary expenditure of $347,560,690.63. If the surplus is to be ascertained by comparing the ordinary revenue with the ordinary expenditure-and that was the time-honoured way of determining surpluses-then on that year there was a surplus of $34,391,696.36. But there was a capital expenditure of $16,295,332.55. If we take that into account, both ordinary expenditure and capital expenditure, there was still a surplus of $18,' 096,363.81. Then there were certain special expenditures, including demobilization charges, of $1,526,583.22. So, if we take into account ordinary expenditure, capital expenditure and what is called special expenditure, there still was a surplus of $16,569,780.59. So far this is a story of surpluses; but there is a further statement to be made which quite destroys that happy picture. There were charges for advances to railways of $97,950,645.36. If we take, then, the whole expenditure for the year, ordinary, capital, special and railways, there was a deficit in that year of $81,380,864.77. After allowances for some deductions are made, the net result was that in that year we added to the public debt, $81,256,818.04.

The minister was reviewing in his budget speech the year 1921-1922. He continued:

We turn now to the year 1922-23 which closed not many days ago. We have not the complete accounts before us, but there is sufficient information to enable us practically to announce the result. Ordinary revenue amounted to $393,619,000. These are estimates, as the figures, are not absolutely final. Ordinary expenditure amounted to about $331,780,000. As between those two items, there was then a surplus of $61,839,000. Capital expenditure, however, represents $14,500,000; adjustment of war claims, $6,700,000; cost of loan floatations, $3,050,000; these representing in all, $24,250,000. There was thus a surplus over ordinary, capital and special expenditures, of $37,589,000. But again the railways have to be taken into account. We had to advance during that year $92,190,000 for railways, and $6,060,720 for the Canadian Government Merchant Marine, making in all for that charge, $98,250,720. This, of course, takes up all the surplus and leaves a large balance on the other side of the account. If we take everything into consideration for the year, the net result was that we added to the public debt in the year just closed, $49,293,086. The receipt of something over $8,000,000' from the British government on exchange

account helped us to keep down what otherwise would have been a larger addition to the public debt.

That closes the minister's statement, and I may say that this statement of the minister, the total statement that I have read, giving a clear, distinct account of expenditures for the two years, covered one column of Hansard. It took ten columns of Hansard for us to get a confused, elongated statement from the Acting Minister of Finance (Mr. Robb) that was practically intended to confuse and that gave very little information. The Acting Minister of Finance is not in his seat and not many ministers are present. The Minister of Justice (Mr. Lapointe) is present and I assume that he knows something about the statement. For my part, I have never had any opportunity, although I have some acquaintance with accounts, of seeing these accounts, or of knowing what they contain or how they are made up, and we do not get a full statement of accounts. The Minister of Finance, whose statement I have just read, says that in 1921-22 we had a deficit of 181,000,000 which should be added to the public debt, and that in 1922-23 we had a further deficit of 849,000.000 that should be added to the public debt. I can find no evidence of those two amounts having been added to the public debt. Will the minister who is present tell me if he knows if those items have been added to the public debt? I am sorry I have not been able to engage the attention of the Minister of Justice.

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE:

I am listening to my

hon. friend.

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

I see the Minister of

Agriculture (Mr. Motherwell) in his seat and I hope he can answer the question whether this amount has been added to the public debt. Do any of the ministers know? Have they any knowledge of those accounts? I explained a moment ago when the Minister of Justice was not listening that I had no way of getting at the accounts and knowing for myself, and I am asking for information now. The hon. member for Brome (Mr. McMaster) is not in his seat, 'but he told us the other day that these accounts were very clear, and if he were present I would ask him if he knows if those amounts have been added to the public debt. Can any of the ministers tell me if those amounts have been added to the public debt? Are there any other accounts on the other side of the ledger that are not shown in this statement and that should be credited? Do they know that?

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE:

We are not sitting in

committee.

The Budget-Mr. Chaplin

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

I am sorry the minister,

who says that we are not sitting in committee, does not know. This is a matter in which the people of Canada are interested. It is a matter that the members of parliament are interested in and I think that some minister should be able to answer the question, which is a fair one.

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE:

My hon. friend may know many things but he does not seem to know the rules of the House.

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

I may not know the rules of the House as well as the minister does, but one thing I do know and that is that the people of this country desire to learn something about these accounts. I shall refer again to the statement of the Acting Minister at page 1468 of this year's Hansard. I notice that the acting minister has given us a report for three years, 1922-3, 1923-4, and

1924-5; but has not included the year 1921-2. What was the reason for omitting that year, during a part of which they were in office? That was the year they prepared their first balance sheet and there does not seem to be any reason why it should not be included in this statement. Well, there is a reason; the first year they do include in this comparative statement shows that they paid $80,000,000 in cash to the railways. But had the government included1 the previous year the accounts would have shown that they had to borrow money for this purpose and it did not suit them to give the full information. That is the reason why the year 1921-2 is not included in this statement of loans to the railways. There is another question I want to ask the government but before I put it I shall quote the statement of the Minister of Finance (Mr. Fielding) regarding the actual figures for 1922-3. He says:

But again, the railways have to be taken into account. We had to advance during that year $92,190,000 for railways and $6,060,720 for the Canadian Government Merchant Marine, making in all for that charge $98,250,720.

I find on referring to this statement that the acting minister gives us for the year 1922-3 the sum of $80,000,000 as having been paid to the railways in cash, whereas the Minister of Finance (Mr. Fielding) in his budget speech that year gives the sum of $98,000,000. I want to know, and I think the House is entitled to know, what became of the difference of $18,000,000. Where is it? But we are told that we are not in committee and that therefore the government cannot answer.

I referred a moment ago to the fact that the minister had devoted one column of Hansard to a succinct, definite, positive,

straightforward statement of the affairs of this country for two years while the acting minister had taken up ten columns, two of which comprised political propaganda while in the remainder the accounts were so mixed up that nobody on the top of this earth, unless he were an accountant, could make them out. And yet we have hon. gentlemen in this House who will get up and tell us that the accounts are clear and understandable. I want to know just what they mean; but of course we are not in committee and the government cannot answer. So much for this statement. A statement has been sent forth to the country that we have 4 p.m. a surplus this year of $1,800,000.

But before I leave this point definitely I want to make a comparison between the alleged surplus of this year and the accounts as we have had them before; I want to compare the financial statement for 1923-4 with the present one. In the year 1923-4 the receipts amounted to $393,000,000; whereas our present receipts amount to $344,000,000; and in the previous year, the expenditures were $331,000,000 as against $342,000,000 for the past year. In the year 1923-4 there was a surplus of $37,000,000, with a very mucn larger revenue; and the acting minister now shows a surplus of $1,823,000 before the railways are considered. So that for last year this government does not take the railways into consideration at all, but in the previous year I mentioned the minister did; with a surplus of $37,000,000 in his hand he came through, after accounting for the railways, with a deficit of some $49,000,000; whereas this year the government comes through with a surplus of $1,800,000. If that is not the most ridiculous statement ever foisted upon an unsuspecting public I should like to know what is. And the acting minister in two pages of propaganda gives us a certificate that means nothing, from auditors who never audited.

I want now to come to the principal change in the tariff, and that is the duty on coal. Let me say at the outset that I am in favour of that duty. If the duty on coal is intended to stimulate production in the coal areas I am in favour of it; and if it is intended to take care of unemployment I am still in favour of it. But I wish to point out to the minister that there are other parts of Canada which are suffering to-day from unemployment, and if the government can make provision for one part of the country why can they not provide for others as well? Are they doing it in this case only because they are clubbed into it and not because they want to do it and

The Budget-Mr. Chaplin

because it is right? There are in the provinces of Ontario and Quebec to-day people who are using coal on a large scale and who by this tariff have had an added burden placed upon them. They are willing to bear this burden; but at this very moment the government reduces, in many cases to as low as 6 per cent, the protection which they themselves need. If protection is a good thing on coal why should it not be good in the case of other commodities? If protection is a good thing for the employees in the coal mines why is it not good for other employees as well? If protection is a good thing for workers out of a job in Nova Scotia and Alberta why should it not be good for those in Ontario and Quebec? I had hoped that there would have been in this budget some provision for added protection to certain farmers of the country, and I refer especially to fruit and vegetable growers and to those who are interested in the production of eggs and butter and cheese. And I submit that we should have, in regard to these things, a duty approximating the American tariff. That is what we need in order to stimulate the production of these people. But what do we get? The farmers of Ontario and Quebec ask the government for bread, and they give them a stone in the shape of an export duty on power. Export duty on power? It seems to me the ex-Minister of Finance (Sir Henry Drayton) explained that situation pretty well: if that duty could be laid on the American consumer of power it would be all right; no objection would be taken. But that cannot be done; the duty will be paid by the people of Ontario and Quebec. Ontario power is being sold to-day on the basis of cost and any duty that is placed upon it will fall directly upon the people using the power. I miss my guess if the people do not hand the government a few doses back when they get the opportunity. We await very confidently the chance, and so will they.

I want to say a word in reference to the claim that the people of this country have had their taxes lessened by $52,000,000. Last year the Acting Minister of Finance (Mr. Robb) in his budget predicted that there would be a reduction of $24,000,000 because of the lessened sales tax and because of some slight reductions in the duties. He did not figure on a loss of revenue of $52,000,000. But he estimated wrongly; the reason the revenues went down was because the people did not have the means to buy the goods, and the government should claim credit for that too; they should claim credit for the forced economy of the people. I say the people did

not have the money to buy. Many of them were farced out of employment by this government, and those still in the country were working half time. The government have solved this question in pretty much the same way as they have solved the housing proposition. "Canada is coming through," they say in this advertisement which appeared in a great many papers throughout the country.

I quote from it:

The housing scarcity, which was so serious as the result of the cessation of building during the war, has now been fairly met.

"Fairly met"! The people have been driven out of the country, and there are plenty of houses now. Go to Hamilton, Brantford and other places, and see what the condition is. My own city is better off because the government are spending money there on public works and the local people are getting the benefit. But in Hamilton, I understand, there are three thousand vacant houses; and it is the first time since the war that there have been any vacancies of consequence. And the government have solved the housing problem!

Speaking of miscalculations, in his budget speech of 1923 the Minister of Finance (Mr. Fielding) was very cautious, as he always was; when he came to the question of future business all he did was express a pious hope that business would be better. But the Acting Minister of Finance (Mr. Robb) was far more optimistic. In 1924 he said:

The more of the products of the farm, the fisheries, the mines and the forest we have going to market, the greater will be the earnings of our transportation companies-the greater the purchasing power of the nation, and as a consequence we shall have factories running full time and tradesmen working overtime to supply the needs of those who have money to buy.

Fine sentiments! We have had in this country, Sir, -three years of fairly average crops, with very large exports; probably as large as we have ever had in any -three normal years. Have our factories been -running full time? Have our tradesmen been working overtime? Again in 1924 he said:

Our budget shows a reduction in debt of $30,000,000 last year and a reduction of taxation of $24,000,000 this year. It is confidently expected that this reduction will give such impetus to trade that it will result in greater development and prosperity to all the provinces of Canada.

Now the acting minister says that the reduction in taxation instead of being $24,000,000 is $53,000,000, Well, if it is reasonable to say that business would be stimulated by a reduction of taxes of $24,000,000, should it not have been far more stimulated with a reduction of $53,000,000? Where has this business stimulation taken place? Has it been in Nova Scotia? Has

The Budget-Mr. Chaplin

it been in any of the Maritime provinces? Is business better in Quebec or Ontario? The truth is that this government have paralyzed business; they have driven thousands of people out of the country, and that is the real reason for our falling revenue and our lessened purchasing power.

I want to discuss for a few moments, Mr. Speaker, a question that is dear to the heart of my friends to the left, and one that has been discussed in this House more times than enough. Hon. gentlemen to my left have accepted it as an axiom that a tariff is a tax and is always paid by the consumer. The hon. member for Brome (Mr. McMaster) has similar views; and the Prime Minister (Mr. Mackenzie King) a few days ago said that the tariff is always a tax. Some years ago the United States ,put a duty on wheat of 42 cents a bushel. I would like to ask the Minister of Agriculture (Mr. Motherwell), for instance, who pays that tariff tax of 42 cents a bushel on wheat; I would like to ask any'of my friends to the left who pays dt? Nobody answers. What is the matter with hon. gentlemen? Are they mute?

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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PRO

Robert Forke

Progressive

Mr. FORKE:

Nobody pays it.

Topic:   THE BUDGET
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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. OHAPLIN:

Nobody pays it? Does

this tax, then, come under the head of a prohibitive tax? How can the minister say, how can hon. members to my left say, that the tariff is always a tax? I ask the hon. member who just answered me, is this a prohibitive tax, if it is not paid? Why is it not paid? Why are hon. gentlemen so mute about it? They are not always so timorous.

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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PRO

Thomas Sales

Progressive

Mr. SALES:

Did the hon. member ever

hear of a drawback of 99 per cent for export purposes?

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

Well, if that is an answer to my question as to who pays the tariff tax, then I .must say it is a very intelligent answer, and I commend it to the rest of the hon. gentlemen.

Topic:   THE BUDGET
Subtopic:   CONTINUANCE OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE ACTING MINISTER OF FINANCE
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April 7, 1925