March 28, 1933

LIB

William Alexander Fraser

Liberal

Mr. W. A. FRASER (Northumberland):

I should like to ask the Minister -of Agriculture whether h-e contemplates introducing legislation this session for the revision of the act relating to fruit marking.

Topic:   FRUIT MARKING
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CON

Robert Weir (Minister of Agriculture)

Conservative (1867-1942)

Hon. ROBERT WEIR (Minister of Agriculture) :

The matter is under consideration.

Topic:   FRUIT MARKING
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THE BUDGET

CONTINUATION OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE


The house resumed from Friday.. March 24, consideration of the motion of Hon. E. N. Rhodes (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Ralston.


CON

Henry Herbert Stevens (Minister of Trade and Commerce)

Conservative (1867-1942)

Hon. H. H. STEVENS (Minister of Trade and Commerce):

Mr. Speaker, another year

in the fiscal history of this country has come and gone, and perhaps what is even more important is that another year of this period of intense economic and commercial depression is past and gone. As we look back over the past year and, indeed, over the past three or four years, many of us are willing to admit that we are much wiser to-day than we were three or four years ago. Many proposals made with great confidence that some suggestion, if accepted, would cure all the ills from which we were suffering, we now realize were mistaken ideas.

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

Some hon. MEMBERS:

Hear, hear.

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

Henry Herbert Stevens (Minister of Trade and Commerce)

Conservative (1867-1942)

Mr. STEVENS:

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

Ian Alistair Mackenzie

Liberal

Mr. MACKENZIE (Vancouver):

It is.

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

Henry Herbert Stevens (Minister of Trade and Commerce)

Conservative (1867-1942)

Mr. STEVENS:

I think it is not. If we

are sending out to the markets of the world a quantity of Canadian products reasonably commensurate in volume with what we were sending before, then I think we can claim that our trade is not in a bad state. Of course, the question of value enters into it;

The Budget-Mr. Stevens

no one denies that. But it is obvious that we could not export from this country in times of depression two or three times the volume of goods that we exported before in order to equalize the value of our exports due to the fall in prices. I submit this to the house, that if it can be shown that the volume of our trade is being reasonably well maintained during this period of difficulty, the hon. gentleman's argument falls to the ground1; and secondly, that if it can be demonstrated that prices have fallen in a corresponding ratio to the drop in revenues, there is nothing left to his case.

In the first place I shall deal with our trade, giving a few very striking illustrations. The year 1932 has been declared one of the worst years in our history both as regards trade and economic conditions throughout the world generally. I now give to the house the following increases in the value of our exports to some ten different countries, among them being many of our chief customers, and all these are increases on the basis by which my hon. friend from Shelbume-Yarmouth measures trade; that is dollar increases, an actual increase in the dollar value of the

goods exported, and therefore the volume of the trade itself must also have been greatly increased:

Exports

1932 increase in value over 1931

United Kingdom $6,637,000

Netherlands 3,334,000

Belgium 561,000

Australia 2,368,000

Peru 89,000

Norway 324,000

Sweden 846,000

Spain 1,497,000

Russia 1,677,000

Ceylon 5,000

That makes a total of $17,300,000 of an increase in the value of our exports to those countries. Consequently my hon. friend cannot claim that we are closing those markets to the Canadian producer.

Now I turn to our trade with the United Kingdom, and I will give to Hansard a statement which I shall read. I have included wheat in. the list for purposes of information not that I claim any trade significance in regard to it because wheat is something that is exported in very large quantities in all years:

Canada's Exports to the United Kingdom showing Increases Ten months ended January 31, 1932, 1933

Apples, green Bbl.

Fruits, canned, preserved Lb.

Fruit juices and fruit syrups Gal.

Fruits, dried Lb.

Oats Bush.

Wheat Bush.

Bran, shorts and middlings Cwt.

Flour of wheat Bbl.

Macaroni and vermicelli Lb.

Oilcake and meal Cwt.

Tobacco, unmanufactured Lb.

Senega root Lb.

Lobsters, canned Cwt.

Hides and skins, n.o.p Cwt.

Beef, fresh, chilled, or frozen Cwt.

Bacon and hams Cwt.

Canned meats Lb.

Pork, fresh, chilled or frozen Cwt.

Pork, dry salted Cwt.

Poultry, dressed or undressed Lb.

Cheese Cwt.

Milk, condensed, powdered, evaporated. ..Cwt.

Animal fats, n.o.p Gal.

Fish oil, n.o.p Gal.

Grease and grease scraps Cwt.

Lard compounds Cwt.

Honey Cwt.

Socks and stockings Doz. prs.

Wrapping paper, kraft Cwt.

Planks and boards M ft.

Timber, square M ft.

Castings Cwt.

Rolling mill products Ton

Typewriters and parts No.

Automobiles, passenger No.

Quantity Per cent

1932 1933 increase1,240,482 1,315,128 6-04,733,671 8,400,971 77-5196,025 363,329 85-583,975 239,915 185-75,153,448 7,470,625 45-0101,293,076 135,292,710 33-0196,820 1,470,026 646-81,765,424 2,035,929 15-3761.385 1,587,194 108-543,208 75,811 75-53,571,594 9,590,922 168-543.497 63,108 45-128,106 28,646 1-94,951 10,331 108-74,781 19,382 305-4106,491 289,641 172-014,885 390,622 2,524-34,459 17,010 281-54,274 18,122 324-056,175 1,203,645 2,042-7800,481 821,013 2-665,560 157,946 140-988 17,533 19,823-916,574 187,086 1,028-85,973 -41 1,086 2,548-81,823,522 2,111,766 15-83,055 19,295 531-615,394 17,211 11-8100,612 159,855 58-918,674 21,773 16-62 3,032 151,500-04 240 5,900-0415 10.012 2,312-5219 1,562 613-3

The Budget-Mr. Stevens

Canada's Exports to the United Kingdom showing Increases

Ten months ended January 31, 1932, 1933- Cone.

Quantity Per cent

1932 1933 increaseCobalt alloys. .. ..Lb. 12,650 22,279 76-1Copper bars, rods, sheets, etc. . . . 146 174 868,577 494-2Lead in pigs, refined lead 774,018 1,061,356 37-1Abrasives, artificial, crude . . . .Cwt. 30,107 55,536 S4-5Coal tar and pitch .. ..Gal. - 962,190 -Graphite 500 1.411 182-2Talc 18,152 25,938 43-0Cobalt, oxides and salts .. ..Lb. 154,000 273,000 77-3This, Mr. Speaker, indicates the Ill OTGSSC in imports. With that in mind I am goingin the volume of our exports to the United to give a corresponding table of the increase Kingdom of the items I have mentioned. in imports from the United Kingdom to Can- There are those who say there is no increase ada. The list is as follows: Canada's Principal Imports from the United Kingdom 10 months ended January 31, 1932-33 Quantities Per cent1932 1933 increaseOranges . .Cub. Ft. 21,611 35,402 63-8Nuts (except coconuts) .. ..Lb. 621,100 1.050.228 69-1Castor oil .. ..Gal. 74,588 133.587 79-1Cottonseed oil, crude 44,981 90,646 101-5Oil for soap .. ..Gal. 112.581 179,622 59-5Crude rubber .. ..Lb. 4,474 1.398,830 31,165-7Confectionery .. ..Lb. 2,497.605 2.507,609 0-4Cotton yarn .. ..Lb. 1,427.605 1,912.397 34-0Piece dyed .. ..Lb. 1,478,284 1.640,946 11-0Velvets and plushes .. ..Lb. 218.536 294.275 30-1Handkerchiefs, cotton Lb. 227,S40 259,140 13-7Towels Lb. 461.0S4 500.939 8-6Handkerchiefs .. ..Lb. 98,599 105,080 6-6Wool noils .. ..Lb. 105,632 677,812 541-7Worsted tops .. ..Lb. 3,756,161 4.814.986 28-2Locomotive and car wheel tires. . . . . .Cwt. 23,417 54,638 133-3Band and hoop iron 12.922 15,291 18-3Bars, including rails 68,558 105,607 54-0Galvanized sheets 290.793 401,757 38-2Sheets, No. 14 gauge or thinner.. .. . .Cwt. 114,617 212.345 85-3Bauxite ore - 263,893 * Tin in blocks, etc 4,179 5.104 22-1Batteries, storage . . . .No. 19 178 836-8China clay 185,138 196.231 C-6Coal, anthracite 869,919 1.380,894 58-7Coke .. ..Tons 1.103 40,113 3.536-7Common window glass . .Sq. Ft. 488,486 1.030.988 111-1Salt 479.644 569,609 18-8Lithopone .. ..Lb. 1,681,341 2.203.720 31-1Oxides .. ..Lb. 1.022,432 1.095,167 7-1Zinc white .. ..Lb. 2.639,697 4.852,053 83-8Potash and compounds .. ..Lb. 370.428 485,247 31-0Soda and compounds .. ..Lb. 15,447,188 18,430.356 19-3

The reading of these items may be a little wearisome, but the point I wish to make is that the hon. member who criticized the government so bitterly made the claim that our trade was diminishing. Undoubtedly the trade of Canada is diminishing, in common with that of the world, brought about by the calamitous fall in the price levels. But if it can be shown that Canada is maintaining in some measure the volume of its business, the export of its goods in weights and measurements, then we have reason for encouragement and hope. That is the point I am bringing out.

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

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Mr. MACKENZIE KING:

May I ask the minister if he has corresponding tables on exports and imports with respect to world trade?

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

Henry Herbert Stevens (Minister of Trade and Commerce)

Conservative (1867-1942)

Mr. STEVENS:

I shall come to that in a minute. Although I shall not read it in detail because it would be too wearisome, I shall give to the house briefly a resume of new busi-

The Budget*-Mr. Stevens

ness that has been secured by the various commercial trade agencies of the government in all parts of the world. This deals with the increase in the value of business, or the new business secured in the agencies established at the following places: Athens, Batavia, London, Bristol, Liverpool, Glasgow, Dublin, Oslo, Brussels, Hamburg, Milan, Paris, Rotterdam, Melbourne, Auckland, Calcutta, Port of Spain (Trinidad), Kingston (Jamaica), Rio de Janeiro, Havana (Cuba), Panama City, Lima (Peru), Mexico City, Buenos Aires, New York, Shanghai, Hongkong, Tokyo, Kobe, Cape Town and Cairo. In all these places substantial new business has been obtained by the trade agencies of the government, and it shows for the year in the 603 established agencies new business valued at $11,000,000. All this indicates the efforts being put forth by the government and its officials abroad, and the results being achieved.

Now coming to the question the right hon. gentleman asked a minute ago. He asked if we had any evidence to show that there is a general increase in business. I do not say that there is an actual increase in all our business, or in all our exports. But I have here a calculation made for me by the Bureau of Statistics which indicates that the fall in the volume of our trade as compared with 1930, is only five per cent. I refer to the total exports to all parts of the world. This, I think, is a creditable showing. The calculation is based upon this premise: I include in the statement, in both instances exports only, that is in the 1930 price and in the 1932 price. We take the volume of business in 1932, and measure it by the price level of 1930, or apply to the volume of business in 1932, the price of 1930. Revaluing the 1932 exports at the 1930 price we have this result:

Exports

1930 $895,000,000

1932 840,000,000

Or a decline of $44,000,000 or about five per cent. That, I think, is substantial evidence of the extent to which we are maintaining the volume of our trade abroad.

The other day the hon. gentleman had another criticism when he said that the shrinkage in customs revenue was due to tariffs. Or, to use his own words, he said that our tariffs went on in May and then down went the imports, down went customs revenue with the result that our customs revenue in 1931 was $145,000,000 and in 1932, $69,000,000. In order to support his argument he gives a table of percentages. He shows in this table

that in 1926 the percentage of customs revenue to the total revenue was 42, and it has fallen in 1933 to 28 per cent. I ask the house to examine these figures. In the first place the hon. gentleman seeks to prove that because there was a fall in customs revenue in relation to total revenue, to 28 as compared with 42 per cent,-a fall it will be noted of 33J per cent,-that was entirely due to the imposition of restrictive tariff duties. I wish the house to follow me in a recital of price indices for Canada, the United States and the United Kingdom. We have the following rather interesting result. Taking 1926, which was the year he used in his calculations, as 100, we have this result; the Canadian price index, 100 in

1926, was 63-6 in February, 1933, or a drop of 36-4 per cent. Irving Fisher's index, 100 in 1926 was 55-3 in February, 1933, a drop of 44-7 per cent. The Bureau of Labour figure in the United States, 100 in 1926, was 62-6 in 1933, a drop of 37-4 per cent. The Economist index in the United Kingdom, 100 for

1927, was 61-2 in January, 1933, a drop of 38-8 per cent. In every instance, in Great Britain, in the United States, in Canada, you have a drop in prices of 36 to 44 per cent. Consequently there was bound to be a corresponding drop in the revenue collected from ad valorem taxes. So while there was a drop in the proportion of customs revenue of some 33-J per cent it is only reasonable to assume that it was in large measure accounted for by the drop in the price level of goods in that period of time.

Then I take another test of the fairness of my hon. friend's argument. I remind the house that the charge is that the rates of duty have been boosted unduly and unwarrantably. He says, "Up went the duties and down went revenue." Let us take the average duty on goods imported from the United Kingdom, other than alcoholic liquors, for the term in which my hon. friends opposite were in office. You have an average rate of 17-9 per cent. In 1932, under the present government's increased tariffs condemned so much by my hon. friends, we have a rate of only 18-62, about f of 1 per cent increase on the average on dutiable goods imported from the United Kingdom. If we turn to the United States we find this figure. During the Liberal term of office the average rate of duty was 23-9 per cent and under the present government in 1932 it was 27-45 per cent, in other words an increase there of about 3J per cent.

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

William Daum Euler

Liberal

Mr. EULER:

Does that include the specific duties?

The Budget-Mr. Stevens

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

Henry Herbert Stevens (Minister of Trade and Commerce)

Conservative (1867-1942)

Mr. STEVENS:

It includes all duties as far as I know. It is calculated in the regular way by the Bureau of Statistics and carried through in both instances on the same basis.

I wish also to give at this time an indication of the trend in Canada's trade, the proportions of Canada's imports from and exports to empire and foreign countries. In 1929 our imports from empire countries were 19-8 per cent of our trade, in 1932 this had increased to to 28-3 per cent. Our exports to empire countries, 33-4 per cent in 1929, had increased to 44 per cent in 1932. Then for foreign countries we find the reverse situation. It will be noted that there was an increase of about 10 per cent in the proportion of trade with empire countries in the last four years, and we find a decrease in our trade with foreign countries, from 80 per cent in 1929 to 71 per cent in 1932, for imports; and from 66 per cent to 56 per cent for exports. Taking the United Kingdom figures, we have 15 per cent of our imports coming from the United Kingdom in 1929, and 20 per cent in 1932; and our exports to the United Kingdom increased from 24 per cent in 1929 to 36 per cent in 1932. This will indicate the trend of Canadian trade. Unquestionably we are gradually seeing the result of the Imperial economic conference proposals and agreements of last summer.

My hon. friend, the critic of the opposition, denounced the government tax proposals very bitterly. His speech was designed, I think, to attract the support of every tax-dodger in Canada. He found fault with every form of taxation, every impost, that the Minister of Finance found1 it necessary to make. And he used this old hackneyed phrase; the taxation proposed, he said, will fall upon those least able to bear it.

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

An hon. MEMBER:

He was right.

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

Henry Herbert Stevens (Minister of Trade and Commerce)

Conservative (1867-1942)

Mr. STEVENS:

An hon. gentleman says

he was right. Let him look for a moment at these facts. Here is the record from the public accounts, page 52. Taxes paid by banks, average for the years 1922 to 1930, $1,240,000. The average for the years 1931 to 1933 was $1,390,000. In other words there was an increasce of taxation of banks during the term that we have been in office as compared with the time when my hon. friends were in office. Then let us take income tax; the average amount of income tax during the 1922-30 period when my hon. friends were in office was $57,000,000 annually. In the last three years, 1931-33, the average is $65,000,000, and that with the falling off in earnings and diminution of revenue upon which this tax

could be imposed. So we see that in income tax and the tax on banks we have a larger imposition under this government than under my hon. friends opposite. Take sales tax. This is the tax, mark you, which comes under the category of the hon. member's description, taxation which will fall upon those least able to bear it. It is the tax he referred to the other day as the one that would be the poor man's tax. From 1922 to 1930 the average was $94,000,000. And in case my hon. friends say, Oh but there was a lot of business, let me remind them that for a very substantial portion of that time they had a 6 per cent sales tax, just what it is to-day. And for a very substantial portion of that time they had a smaller exempt list than we have to-day. In other words there was a heavier weight of sales tax during the term of office of my hon. friends than theTe is at the present time.

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

James Malcolm

Liberal

Mr. MALCOLM:

But values are lower

now.

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

Henry Herbert Stevens (Minister of Trade and Commerce)

Conservative (1867-1942)

Mr. STEVENS:

During the years 1931-33 the average has been $59,000,000, as against $94,000,000 in the previous period. When my hon. friends go, as they will, with the speech of the hon. member for Shelburne-Yarmouth (Mr. Ralston), before this country and argue that this government is imposing taxes upon people who are least able to bear them, let them bear in mind where that weight of taxes rested during the nine years that they were in office.

Now the hon. member sneered at the agricultural stabilization plan. He said it was a very unsound principle. He said, in principle I am opposed, have always been opposed, to this sort of thing. Now the hon. member for Shelburne-Yarmouth spoke for the Liberal party. He is opposed to this thing. Absolutely opposed to it. Then he turned around and said the main thing that was wrong with it was that it was not extended to all kinds of products. He says it is unsound and uneconomic, but the chief thing wrong is that it is not extended to manufactured products. Not satisfied with that he says, "Why, you are only extending it to goods sent to the United Kingdom. You ought to apply it to goods going to all parts of the empire." Then, carried away with that, he said it should be extended to goods sent to the United States. He wanted to apply this form of stabilizing exchange to goods sent to the United States, whose money is at a premium in this country; that was his proposal. Let us examine his position.

The Budget-Mr. Stevens

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

James Malcolm

Liberal

Mr. MALCOLM:

Would the minister

indicate in Hansard where the financial critic said he wanted the stabilization fund to apply to goods sent to the United States?

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

Henry Herbert Stevens (Minister of Trade and Commerce)

Conservative (1867-1942)

Mr. STEVENS:

Yes, gladly.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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March 28, 1933