April 7, 1925

CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

Mr. Speaker, I think I

know that pamphlet quite as well as the hon. member who has just spoken, and if he will indicate to me where that clause is to be found I will have very great pleasure in reading it. There is not a line in the platform that I do not know; I made it my business to know it; and if the hon. member can indicate to me where that is, I will be very glad to read it.

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PRO
CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

Do not worry, I can

come to that in a minute; but I do not pro-

pose to be taken away from my subject by any outside questions. I invited questions from my hon. friends a minute ago, and I found them pretty mute, pretty timorous, but of course they will do anything to get me away ifrom my point.

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PRO

John Livingstone Brown

Progressive

Mr. BROWN:

The hon. gentleman did

not sit down long enough to allow us to put a question.

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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

I am ready, Mr. Speaker, to sit down at any moment that any hon. gentleman wants to rise. Can it be made any plainer to anyone who wants to listen that this is still another case where the tariff is not always a tax? If so, I would like to know it.

Of course, the same thing can be illustrated in hundreds of cases of manufactured goods. Had I only at the inception taken certain cases of manufactured goods, my hon. friends- as one did a minute ago-would have tried to put me right out of business. I can tell him this. I have been in business forty years. I have grown up in a business from being the office boy to manager. I have during a period of ten or fifteen years occupied the buyer's desk, and I can say that for the period I was buyer, and it was followed up to a few years ago, on everything that was bought and that came in through the customs house the man that sent the goods in paid the full duty. That was part of the buyer's business to see that he got that, and I claim that you cannot have two parties paying the duty. Now as a finish to this-

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PRO
CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

Mr. Speaker, I did not

see the hon. gentleman rise, although he made some remark.

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PRO

John Livingstone Brown

Progressive

Mr. BROWN:

I would like to rise and ask, if the buyer paid the duty in the first place, was not that added to the cost of the finished article, with overhead and so forth, and the consumer ultimately made to pay the duty?

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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

I did not say that at all.

The hon. gentleman misunderstood what I said. What I said was that the man who sent the goods in here, the seller, had to make a reduction in his price sufficient to pay the duty, and consequently there was no overhead and nothing else except the ordinary profit to be added. .

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PRO

John Evans

Progressive

Mr. EVANS:

If that is the case, then in

what way does the tariff become of benefit to the Canadian manufacturer?

The Budget-Mr. Chaplin

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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

I am relating something

that happened for years under the operation of the tariff. To take care of that very thing the present Finance minister placed a law on the statute book; he enacted a dumping law , to which these gentlemen profess to be so much opposed. That was the reason for the dumping clause. The present Finance minister realized the necessity for it because he sat at the helm and knew what was going on, and consequently he caused a law to be enacted to prevent it from continuing. That is the answer to .my hon. friend. Is there anything more wanted in the way of proof that the consumer does not always pay the duty than the very law enacted by a Liberal Finance minister to prevent the seller from paying the duty?

Now, Mr. Speaker, I want to refer to another matter. The Acting Minister of Finance has told us that we have lost a lot of revenue. He has even taken that loss of revenue and put it to good account so as to enable him to say "Why, I have reduced taxation." I want to show as briefly as I can some losses that occurred that were not expected, especially when we entered into the French treaty. I have prepared a list-and I think perhaps this may interest the Minister of Justice (Mr. Lapointe)-of imports from France to Canada and of exports from Canada to France, based upon the ten months of the present fiscal year, 31st March, 1924 to 31st January, 1925, and the comparative figures I will give are for the corresponding ten months periods in each of the years quoted. I give the statement in that form so as to make a fair comparison for the ten-month period in question. The Canadian imports from France are as follows:

1923 $10,255,000

1924 13,113.000

1925 15,167,000

So much for the imports; the gradually ascending scale will be noticed. The Canadian exports to France for the same period were:

1923 $11,299,000

1924 15,427,000

1925 8,383,000

From the sum of $15,000,000 our exports to France dropped to $S,000,000. We started in 1923 with $1,000,000 more exports than imports, and ended in 1925 with nearly $7,000,000 less exports than imports. In other words we sold them this year goods to the value of $8,000,000 and we bought from them goods to the value of $15,000,000. Now I want to point out first of all what these exports consist of. They consist principally

123i

of wheat; pulp; lead; nickel and other ores; asbestos; coal tar; mica; some sugar; canned lobster and salmon; some agricultural implements; and a few scattered articles of manufacture every one of which-I refer to the manufactured articles-will disappear. Why do I say that these manufactured articles will disappear? Simply because the French minimum tariff is too high for us to take advantage of it; we are in exactly the same category in the case of France that my hon. friends from the west are with respect to cattle in the case of the United States. In respect of these exports that we have sold you will notice that in nearly every case they are raw materials: wheat, aluminum, lead, nickel, ores of different kinds; all raw materials. They buy from us a little sugar, a few agricultural implements, and some canned lobster and canned salmon in reduced quantities, because of the fact that the duties have been raised. The articles I have mentioned represent nine-tenths of the total exports and less than $200,000 of our total business was affected by the treaty. In other words, in new business we obtained less than $200,000 and in addition we lost several million dollars of old business. France wants these raw materials and she would take them anj'way; and all we get in the way of new business is less than $250,000. Now, what did we give in return? When we made this treaty with France, Canada gave a list of goods which she could sell to France, and France gave a list of her goods that could be . sold here. France gave us her minimum tariff whatever it might be and she got a fixed rate of duty on a lot of articles. That fixed rate of duty could not be altered by this parliament unless the treaty were abrogated. That is the position in which we are so far as the French treaty is concerned, and we get nothing in return to replace what wo grant. 'When this treaty was being discussed I remember quite distinctly the right hon. leader of the opposition saying to the Minister of Finance, "You should have jacked up your tariff before you went over to France. You should have raised your minimum tariff to a scale that would enable you to trade with them and have something to trade with." I also remember that the hon. member for Lisgar (Mr. Brown)-he is not here this afternoon.

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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

Yes, I see the hon. gentleman now. Well, my hon. friend took exception to the statement of the hon. leader of the opposition when he sairi it. would have

The Budget-Mr. Chaplin

been better for the government to have raised the tariff before entering on negotiations, and said that was a principle of questionable soundness. I have no fault to find with my hon. friend's opinion, I think he gave that opinion honestly, but what has occurred? I want to draw the hon. member's attention to this fact. On looking up the British Board of Trade Journal of January 8, I find this statement:

The Board of Trade have received, through the Foreign Office copy of the government bill-

Meaning a government bill in France.

-to modify the French customs tariff duties on some three hundred articles.

And the paper goes on to say:

The explanatory memorandum to the bill, after referring to the general tariff revision now in hand, describes the nature and purpose of the present proposal, which is not intended to replace or delay the normal tariff revision, but is necessary to enable France properly to negotiate the important commercial agreements now under consideration. The bill therefore proposes to increase tariff duties affecting French industries which owing to the burden resulting from the war, cannot face unlimited foreign competition with the present duties.

In other words, Mr. Speaker, what was a matter of questionable soundness for us to do has already been done by France right in our face, and we stand to-day with several hundred articles on which the minimum tariff is to be raised, and what chance have we to do business with them if the minimum tariff is raised, when we cannot do business now under the present tariff? Let me give the House some examples from this, so as to see what it means:

The duty on blankets and camel hair belting is to be increased by over 100 per cent, and wool, etc., astrakans, plushes, sealskins, etc., would pay from 11 to 22 francs per kilog, instead of 8.82 francs per kilog as at present. The duties on elastic and rubbered clothing would be increased by from 50 to 100 per cent; and on felt hats by from 50 to 200 per cent. The duties on the thinner varieties of oilcloth and linoleum would be increased by 25 to 60 per cent, and other waxcloths would also pay heavier duties.

As regards hardware, the proposed duties on locks, keys and nails are some 30 per cent higher than the present duties; those on saws, files and rasps some 200 per cent higher; and those on other tools, needles and certain cutlery about 100 per cent higher.

And so on through the list. There is no use taking up any more of the time of the House with this matter. The principle is there. Canadians as a matter of fact, have to learn to look after themselves, irrespective of the matter of questionable soundness. This may be all right for France, but it is not a good thing for us. This is the first real big joker in the treaty, and there are a lot of them. I am going to detain the House long enough to

give hon. members some more of the jokers in this treaty.

Now, I wish to say a word or two as to the imports. As I said in my opening remarks on this question, the imports have increased from practically ten million dollars in 1923, for the ten months, to fifteen million dollars in these ten months. We have reduced our duty to France on a great many articles so that she could sell to this country. My hon. friends to my left will say, "Oh well, the people got a reduction in the tariff. It makes no difference as long as the people get the reduction in the tariff." On what articles was the tariff reduced? Let me give the House a rough list of them. They are:

Brandy, champagne, wine, silks, satins, velveteens, laces, silk blouses, silk fabrics, silk clothing, gloves, toilet preparations, soaps, perfumery, statutes, china, jewelry, precious stones, ribbons, embroideries, artificial feathers, and flowers, curtains and shams portfolios, purses and pocketbooks.

No doubt, these purses are for the purpose of keeping some of the savings in taxes that the Acting Minister of Finance is giving back to the people. What did we lose? We reduced our duty to many people who could well afford to pay. If you are ever going to get taxes, you have to get them out of the people who can afford to buy luxuries. This is a rich man's treaty-never intended for the poor man at all. Let me give the House a few instances. I will tell hon. members how I figure the duty, because the Minister of Justice (Mr. Lapointe) with that even handed way of treating things, will tell you that I have not figured it properly, and if I tell hon. members how I figure it there will be no misunderstanding. First of all, I have taken the duties as they actually are. I prepared the figures actually paid for the ten months on the articles I have mentioned, and I had the customs house of Canada guarantee they are correct. I have contrasted with those figures the duties that would have been collected under the general tariff if we had no treaty. On that basis, we lose on champagne 880,000 in taxes.

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LIB
CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

I am not discussing Ontario matters; these are Dominion matters, and for the information of the hon. gentleman who asked the question, I say that we are discussing the budget. We are discussing the budget from the standpoint of the poor people of this country, the people who need to have taxes lifted from their shoulders, and are not discussing those people who are

The Budget-Mr. Chaplin

consuming these goods. The losses are as

follows:

Brandy $142,000

Non-sparkling wines 108,000

Velvets, velveteens and plushes 65,000

Silk fabrics 104,000

Ribbons 31,000

Silk clothing 44,000

Gloves and mitts 37,000

Perfumery and toilet preparations 18,000

Tableware of china 10,000

Medicinal and Pharmaceutical preparations 11,000

Castile soap 7,000

Jewelry 5,000

What happened further was this: that

under the terms of this treaty Japan and Switzerland did not hesitate to take advantage of it. France put her goods in at the same rate, and the people lost so much money in taxes, and those taxes that should have come out of the people who could afford to pay them have to be laid on others who probably cannot afford to pay them. I have not the figures for all the articles. If an item did not realize at least $1,000 I did not worry about it; it was not of any moment, so far as my argument was concerned. From France alone, on the goods we imported, we made a loss for the ten months of $991,000; from Switzerland we made a loss of $310,000; from Japan, $232,000; and from Norway $30,000. These figures are for ten months. When these gentlemen went over there to . make this treaty they allowed French nonsparkling wines to come into Canada at fifteen cents a gallon. At the very time they did this the home producer of wine was paying thirty cents excise duty. And they allowed the competitor's goods to come in at fifteen cents. Consequently when the matter was called to their attention they had to adjust it; with this result, that, instead of charging the home producer of wine thirty cents, they had to reduce the tax to seven and a half cents in order to place the home producer on an equality. I say that anybody at home who can afford to buy an article like wine can afford to pay a tax, and the tax of thirty cents was reasonable and just. But owing to the treaty this tax had to be reduced, and we lost on that operation on that article the sum of $129,000. The total loss was $1,695,000 for the ten months which I have mentioned. If you add two months more on the same basis, it means a loss in revenue of over two million dollars.

Besides the one big joker in this treaty to which I have referred, there are some others. I have not time to refer to half of them here, but I will give the House a few just for the edification of hon. members. Take the item

of gloves and mitts. We reduced our tariff and France gave us her new tariff on gloves and mitts to France to the minimum tariff, but the minimum tariff is so high that we did not ship any, while France shipped us $383,000 worth. We lost in duty over what we had sold to them before, $37,000.

As regards tableware of china, we reduced our duty to France, and France very accommodatingly reduced her duty to us. Just imagine reducing the duty for us to ship tableware of china into France 1 The result was that France sold us all the china, we did not sell her any; and we lost in revenue $11,000. The poor working man in this country saved $11,000 on his china. As regards perfumery and toilet preparations, we lost in revenue $18,000. We gave France fixed rates of duty and we could not change the duty to-morrow if we wanted to do so.

Let me give the House an idea of what comes into this country in the way of nonsparkling wines. In ten months of 1923 there were imported 56,000 gallons and, in 1924-5,

134,000 gallons. We lost in revenue on this item over $100,000. This is supposed to be a temperance country. The hon. member for Chambly and Vercheres (Mr. Archambault) asked: Was it in Ontario where this wine

was used? Before he goes out I should like to give him the figures in regard to the item of brandy. I do not think it was in Ontario, but I will give him the result. In 1923 we imported 43,000 gallons, and in ten months of

1924-5 we imported 146,000 gallons. That is pretty good for a temperance country. Our loss in revenue on that item alone was $142,000.

Let us take the item of canned fruits and canned vegetables on which we gave France fixed rates of duties. We had a loss of revenue. We sold no fruits but we sold them $800 worth of canned vegetables. Just imagine 1 We sold France $800 worth of canned vegetables! In 1920, we sold France $1,000,000 of canned fruits and in 1924-5 we sold nothing. Why? Simply because the Minister of Finance (Mr. Fielding) and the then Minister of Marine and Fisheries, the present Minister of Justice (Mr. Lapointe) went to France and made a treaty with her by [DOT] which France had fixed rates of duties on importations into Canada of canned fruits, and the duties that we have to pay on our importations into France are higher than those she has to pay on importations into Canada. That is another joker in the treaty.

On cutlery and jewellery we lost in revenue $8,000. The Minister of Justice in his address last year told us th?' was going to sell

The Budget- Mr. Chaplin

butter to France. He reduced the duty on fresh butter so that our butter would get in. This is what he said:

We have not negotiated a treaty for the Pilgrim Fathers or for the farmers that came with Cartier or Champlain, we have negotiated a treaty for the farmers of the present.

Let me tell the Minister of Justice that the Pilgrim Fathers and the farmers that came with Cartier or Champlain shipped as much butter to France last year, as the present fanners did. Dead as they are, they shipped not a pound, and neither did the living farmers.

A few years ago we shipped condensed milk to France. In 1922, for instance, we shipped $568,000 worth. The duty was increased by fifty per cent, and last year we sold France

87,000 worth. That is another joker. The Acting Minister of Finance (Mr. Robb) whom I saw here a minute ago, made a prediction in 1923. He said:

Canada will export boots and shoes to France.

I have looked up the records and I find that no leather boots and shoes went to France, although a few rubbers went. I suppose -we shall have another shot about bronze powder from him too. Last year the story was: "Oh, well, we did not make the records." A lot of bronze powder was exported from this country. The minister produced a telegram from a manufacturer stating that they exported a lot of bronze powder. When I said to the minister: "This does not appear in the export

records," he said: "We did not prepare those

records; you prepared them." I have examined the records for the last four years and there are no exports of bronze powder. The minister should communicate with the manufacturers and find out where this stuff 'has gone. It must have gone somewhere and we cannot find it.

Let me mention a few other articles that we used to send to France. In 1920, we shipped $275,000 worth of dried apples; now this trade is gone. In 1922, we sold France $455,000 worth of oats; in 1925, there is no trade-nothing doing.

I cannot pass over this list of luxuries without reading an extract from a speech made by the hon. member for Brantford (Mr. Raymond). We .all know that very delightful gentleman. We all have heard from him of the distress that exists in Brantford, and now that we look back on the matter, we come to the conclusion that the people of Brantford have not gone away because of lack of work. I will let hon. members conclude what the reason is when I read his speech. He said:

In the part of the country that I came from, I beg to say that brandy and champagne are not luxuries, nor, Sir, is sparkling burgundy any luxury. On the contrary, these things are classed with blue pills, calomel and salts.

We had heard that its industries were languishing and its population was scattered, but we are glad to know that its necessities are well looked after. I am afraid that these gentlemen who are out of work in Brantford, instead of having gone away to other localities to look for work, have gone to California or to Florida, and may come back, who knows, in their luxurious motor cars, wearing the luxuries of which I have spoken . I rcgr t having taken up so much of the time of the House and I hope I have not tired hon. members too much.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

What about that long list of drugs which appears :n the treaty? Did we sell any of them?

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CON

James Dew Chaplin

Conservative (1867-1942)

Mr. CHAPLIN:

Answering the question

of the leader of the opposition, I beg ,to say that of all those padded sheets of drugs, several pages, ccntaining some 150 articles, I think there is one on the list of exports, and others that we exported before, now disappear from the list.

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LIB

William Richard Motherwell (Minister of Agriculture)

Liberal

Hon. W. R. MOTHERWELL (Minister of Agriculture):

Mr. Speaker, the budget is one

of the time-honoured institutions of this parliament. It affords an opportunity, not only of discussing the financial affairs of the country for and against the ministry s view of these matters, but further of ventilating grievances and especially of discussing problems which members would not get as good an opportunity of discussing later on in the session. I have to congratulate the official opposition upon their mathematical attainments while discussing this particular budget. They started off with a surplus of nearly two millions and by the time this had passed through various hands it had mounted considerably. First, some hon. gentlemen added gently to it making it five or six millions and then later on it was augmented very materially. I cannot recall just now the particular gentlemen wh* added to it but I remember that the hon member for Vancouver Centre (Mr. Stevens) and the hon. member for Fort William and Rainy River (Mr. Manion) as well as the hon. member for West York (Sir Henry Drayton) all had a hand in it. All these hon. gentlemen gave it the once-over, so to speak, and each time they made it a little more imposing until finally, when the hon. and genial member for Nanaimo (Mr. Dickie) had got through with it, it assumed the formidable proportions of 8100,000,000.

The Budget-Mr. Motherwell

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

That statement was made in the very first speech in the debate from this side of the House.

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LIB

William Richard Motherwell (Minister of Agriculture)

Liberal

Mr. MOTHERWELL:

I did not know

that, but at all events some hon. gentlemen evidently receded from that bold position at first although ultimately they took it up again. And I am afraid that had it not been for the approach of the Easter season, which sometimes has a disciplinary effect on mortals, that S100,000,000 would before long have increased to several hundred millions. Heaven only knows now what it may be after Easter.

I shall now refer to some of the remarks made'by the hon. member for Vancouver Centre and the hon. member for Fort William and Rainy Raver. Exception has been taken by these gentlemen to what they call extravagance on the part of the government, but it will be noted that very few individual items are cited; we have nothing but generalities. The government is brought under one wholesale charge of extravagance and it is said that so bad is this evil that taxation is mounting skyward. And how do hon. gentlemen opposite propose to bring down this mounting taxation? Why, they want to have more protection ; high taxation is to be cured by higher taxation. And so these gentlemen go on proposing their nostrums indefinitely. But the only particular item to which the hon. member for Fort William and Rainy River objected, so far as I could notice, was the alleged extravagance in connection with commissions of investigation, one or two of which he mentioned. The hon. member referred for example to the grain inquiry. Now what is the history of that? It is merely a continuation of an inquiry that was started by the preceding government of which the hon. gentleman himself was for a short time a member. That investigating body created at that time perambulated the whole country, 5 p.m. creating a good deal of consternation because of their crude methods; and things had reached such a pitch that an injunction was sought against their further inquiries. And between these injunctions and their waiting and hovering around, and the fact that the whole country at that time was upset over the prospects of an election, coupled with the further fact that their revenues had been exhausted, they simply hung on until by December 6 they and the government went out together. We had to do something in the matter; and, as will be recalled, the next year the hon. member for Qu'Appelle (Mr. Millar) voiced the opinion that the inquiiy should be resumed; that was what he urged. So that we find one wing of

the opposition, the official section, the year before starting an inquiry but achieving nothing, not even a report being presented, followed b3- another wing of the opposition, the unofficial section, recommending later to this government, through a resolution offered by one of its members and accepted) that the government take up the matter again and proceed with the investigation. And that has been done. Well, where is the extravagance in that? Have we not got value thus far? We have a report upon the subject and a bill will be introduced after the Easter holidays. But there was absolutely nothing to show as a result of the first inquiry started by the government of which the hon. member for Fort William and Rainy River was a member for a very short time. If this is the only extravagance to which hon. gentlemen can point it is surely a very minor one. But it has not been proved that even here there has been any extravagance, because after all, in view of the importance of the subject, the expenditure that has been involved is very small.

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April 7, 1925