Bank oj Canada-Mr. Mackenzie
The last quotation which has already been, referred to in these debates and which I wish to place on Hansard is one from Sir Thomas White which will be found in the report of the Macmillan commission. This is what he said:
It was suggested during the course of our hearings that political influence might possibly affect unfavourably the administration of the I1 inance Act because the Treasury Board which authorizes advances and fixes rates of interest payable thereon is composed of members of the government. _ With regard to this I have only to say that if by "political influence" is meant partisan or improper influence not a shred of evidence has been adduced before the commission in support of such a suggestion.
This bill after its second reading was referred to the select standing committee on banking and commerce, and in that committee several amendments were moved by my hon. friends to my left and several by those of us who belong to the Liberal party. May I very briefly recapitulate the amendments which we moved there and which we subsequently moved in committee of the whole house? I had the honour personally of moving:
That before the committee considers a single clause or detail of Bill No. 19, the committee record itself as being of opinion that this bank should be owned and controlled by and for the people of the Dominion of Canada.
That motion the committee oh banking and commerce in its wisdom rejected. Subsequently I moved a resolution which gave to the Minister of Finance authority to call in shares at a valuation not exceeding par; in other words, our second amendment was a contingent public ownership in the discretion of the administration of the day. Then the hon. member for Shelburne-Yarmouth (Mr. Ralston) moved a very comprehensive amendment giving to the government, to the Canadian people, absolute and definite control, not necessarily with ownership, over the new Bank of Canada, but the committee on banking and commerce, once again, rejected that amendment.
Then the hon. member for Shelburne-Yarmouth moved that the deputy minister of finance who, at his instigation and suggestion, was made one of the directors, without voting power, it is true, be given the privilege of suspensory veto over the proceedings, deliberations and conduct of the privately appointed directorate.
Then the hon. member for Beauharnois (Mr. Raymond) moved a resolution, which I had great pleasure in supporting, appointing a Canadian national as governor of this new Bank of Canada. At that time the Prime Minister asked the bankers who were present
with, as somebody said, their backs to the wall, whether they thought Canadian bankers were competent to regulate and manage the Bank of Canada. I think only one answered. Since the Prime Minister spoke in the house the other day when we were considering this very question of public control, and of a Canadian governor, Sir John Aird, who has been fairly close to some members of the administration, has come out with a public statement repudiating the assertion of the Prime Minister that no Canadian is fit for the exalted position of governor of the Bank of Canada. I wish in a word, without elaboration, to endorse the argument so well advanced the other day by the hon. member for Beauharnois and to repeat what I said then that we need to have a Canadian as governor of this Bank of Canada. We need a Canadian who knows the complexities of our life, the peculiar problems of the province of British Columbia and of the spacious prairies that are facing tremendous agricultural questions at the present time, who knows old Ontario, the grand old province of Quebec and the peculiar problems of the provinces down by the sea. I suggest with emphasis and earnestness to the Prime Minister that no man coming from any other land, no matter how well qualified he may be in the technicalities of central banking, can provide the proper and adequate service in our own central bank that one of our own Canadian citizens could do. I repeat: So far as we on this side are concerned we shall offer no objection to the introduction of all the technical advisers considered necessary from the Bank of England or the Bank of France or any other central bank to advise the Canadian government for one year, or, if necessary, for two years in the intricacies and technicalities of central banking.
Then there was an amendment, in which I heartily concur, moved by the hon. member for Quebec East (Mr. Lapointe) both in the committee on banking and commerce and on the floor of this house. I can do no more than support the glowing and inspiring address given in this chamber the other evening by the hon. member for Labelle (Mr. Bourassa) when he said that we should maintain not only our sovereignty in regard to credit in this our native land, but the sovereignty of the French and English speaking peoples in every nook and corner of this dominion. As a comparatively newcomer to Canada, only twenty years ago now, I have the greatest veneration for its early and romantic history and when we consider the first one hundred and fifty years of our splendid pioneers; when we consider the celebration we are to
Bank of Canada-Mr. Mackenzie
have in a few weeks time, it is only fit that there should be in every mind in Canada the splendid efforts and worthy endeavours of those pioneers in settlement and in government who have given us the house in which to-day in this country we dwell.
Then we come to the question of control. When I moved in this house the other day for public ownership, the Prime Minister made the following objection. He said that in the first place this is against the experience of the world. Well, I am not so very certain that the experience of the world is a safe guiding factor at this time. If he is going to go by the experience of the world in regard to control of banking institutions, is he going to go by the experience of the world in regard to those crazy dictatorships which are being set up in every country in Europe? I suggest that we should preserve for the Canadian people full control over credit, over currency and over note issue; that is the proper course to follow, instead of taking the experience of some crazy nations of Europe which have gone wrong in matters of finance as well as in matters of government.
Then the right hon. gentleman repeated the point with regard to political control. I think Sir Thomas White has answered that, and I think I have answered it sufficiently. He went on to say that under this legislation the profits accrue to the people. Mr. Speaker, under the bill as drawn up at present we have a capitalization of $5,000,000 and an interest rate of four and a half per cent, which means an ostensible profit of $225,000. But may I point out, as I did once before, that when you support this legislation you support the transfer, in the first place, of $70,000,000 worth of Finance Act gold which at the present moment belongs to the people of the Dominion of Canada, to a privately owned, profit making corporation. In the second place you are going to transfer later on $40,000,000 worth of bank gold, less the amount the banks require for external obligations; that is to be transferred to a privately owned, profit making corporation. Then, on the day this bank opens its doors for business, you are going to create $63,000,000 worth of new, three per cent securities; you are going to hand these over to this new, privately owned, profit making institution, and the taxpayers of the Dominion of Canada every year will have to pay $1,800,000 in interest. Bigger than all these things, however, is the sovereign control over note issue, which belongs to parliament and to the people, and you are handing that over to a privately owned, profit making corporation under the legislation which we are asked to support at the present time.
Our resolution with regard to public ownership has been rejected. Our resolution with regard to public control has been rejected, and this afternoon I submit in the strongest possible way that this government, repudiated and rejected, inferentially if not actually, by the people, has not a moral right or a moral mandate in the eleventh hour of its life to pass this legislation, which will bring about a complete transformation of the financial organization of the Dominion of Canada. I say the government have no right to do that on the basis of private ownership without first of all having the principle of private ownership endorsed by the free will of the Canadian people. So, Mr. Speaker, this afternoon I am endeavouring to give expression, in the first place to those who believe in the principle of public ownership, and in the second place to those who believe without debating the merits or demerits of public ownership, that a rigid, definite and well defined public control is necessary in regard to this institution. Therefore I submit the following amendment:
That the bill be not now read a third time but that it be referred back to the committee of the whole with instructions that they have power so to amend it as to provide that the Bank of Canada shall be either,-
(a) Government owned and controlled;
(b) Government owned: or
(c) Government controlled.
That is seconded by the hon. member for Quebec South (Mr. Power). Under this amendment, when the bill is referred back to the committee of the whole, we will have the right to reconsider sections 9 and 17, which deal in the first place with the principle of public ownership and in the second place with the principle of public control of this bank. When I review this legislation as it now stands I am reminded of a quotation from the 32nd chapter of Isaiah, as follows:
The instruments also of the churl are evil; he deviseth wicked devices to destroy the poor with lying words, even when the needy speaketh right. _
But the liberal deviseth liberal things, and by liberal things shall he stand.
Believing as I do, Mr. Speaker, in public ownership and control of this great national financial institution I am pleading with this house this afternoon to devise liberal things, and so far as we on this side of the house are concerned, by liberal things we shall stand.