January 21, 1935

LIB

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Mr. MACKENZIE KING:

That is more than the Prime Minister has ever done.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

The right hon. gentleman now makes it clear that the book he referred to is Industry and Humanity. Well, I have always found it a little difficult to discover what Job meant when he said he wished his adversary had written a book, until I heard the speech this afternoon, and then I realized the full meaning of the observation. But I turned to a more modern and relevant comment to be found in Revelation:

And I went unto the angel, and said unto him, Give me the little book. And he said unto me, Take it, and eat it up; and it shall make thy belly bitter, but it shall be in thy mouth sweet as honey.

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LIB

William Duff

Liberal

Mr. DUFF:

Let the Prime Minister read verse 11 of the same chapter.

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LIB

Ross Wilfred Gray

Liberal

Mr. GRAY:

Bitter or sweet, the right hon. gentleman has swallowed the book.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

lam sorry to see that

an observation from Scripture so disconcerts hon. gentlemen opposite, but it was to be expected. Now, let us have a clear understanding. I said in the broadcast addresses to which reference was made that my concern is with the Liberal party in Canada

since the war. My concern is with the Liberal party in Canada since the war, confronted with conditions such as have never been known in the world. I endeavoured to inquire, and I now propose to inquire, just what the right hon. gentleman did-besides putting it in a book-with respect to the problems to which he has referred. To start with, he came into office in December, 1921. He was in power during 1922, 1923, 1924, 1925, 1926 with a short break, 1927, 1928, 1929 and part of 1930. During the latter part of his term of office this country was in a higher degree of speculation than it had ever before been in its history, and as a result of the failure of his government to take adequate measures to safeguard the public interest, thousands of people became bankrupt and were ruined. Further, the very friends upon whom he relies and upon whom he has relied were those who accomplished those purposes. That is the reason I say that the times cry for reform and that the right hon. gentleman is wholly incapable of effecting reform, because during the period when he had the opportunity in the full flush of power, when he appealed to the electorate in 1925, when he did not receive the majority he sought, and when he came back in 1926, the only reform he put upon the statute books in that year, the measure to which he referred to-night, was a reform forced upon him by the hon. gentlemen who sit to his left. The record of Hansard shows conclusively that that is so and the issue is plain and simple: Are these evils to which he has referred, these evils which we see all about us and which are known to every one of us, the result or not of the capitalist system as it flourished during those years? That is the question. Are they or are they not the result of capitalism as it flourished during those years? If ever there were a case proven it has been by the evidence given by the right hon. gentleman himself to-night. With the amplitude of his power, with all the surrounding he had, he sat quietly by and let those evils flourish to the extent of thousands of his fellow citizens being ruined, and yet his voice was not raised against those evils.

That is not all. When in 1928 I ventured in this chamber to point out the way in which we were proceeding what happened? Those hon. members who may be interested will read in Hansard that on June 9, 1928, I used these words:

It is true that we have a vast, untouched estate, and that new wealth may be produced much more readily from that than from an old and cultivated estate. But it is also true that where we cultivate, it is necessary that we

The Address-Mr. Bennett

should sell, and if we find a curtailment and shrinkage of trade among the nations of the world, we find a limitation placed upon our ability to dispose of that which we produce. The minister knows that. He has been told time and time again by the great heads of financial institutions to be cautious, to look ahead. Every thoughtful business man is doing it; everybody is shortening sail except the speculators. Do you realize, sir, that this great speculative era that we now have on the American continent is one fraught with possibilities of the gravest disaster for this country? The brokers' loans alone in New York last week were over $5,000,000,000. an unheard of figure. In this country speculation is rampant. Some people imagine that trading in pieces of paper upon which there are engraved words and figures constitutes the creation of new wealth. It is not so. The new wealth of the country is being created by the application of labour and capital to the natural resources of the country, and this trading in stock certificates, this great era of speculation in this country and on this continent, is one fraught with possibilities of the gravest danger to Canada, because we have not as they have in the United States a vast accumulation of wealth that will enable us to meet the approa-hing conditions with ease.

Look at the movement of securities; look at the movement of gold; look at every indication there is with respect to speculation in this country. I know great brokers' houses that have declined to take new accounts in this country for over twelve months, one perhaps the greatest brokerage house in this country, because they fear what they see in the distance. But no one in the government seems to care, and if we point out the conditions we are " pessimists," if we venture to direct attention to the conditions we are " decrying our country." That is the talk that hon. gentlemen opposite hurl at us and before the country. But I recall the language of one who was regarded in after years as one of the very greatest of British statesmen, who observed that when this orgy was through, when they had at last recovered from the debauch in which they were then enjoying themselves, possibly then in their sober and quiet moments they would look back and recall the warning that had been given by those who looking into the future as best they could, guided by those economic signs that were apparent, and by beacon lights, warning of the future, had pointed out the conditions as they also had come to pass. You perhaps will look back upon our warnings, and perhaps remember with at least some degree of fair-minded justice the observations that were made by those of us who have pointed out the national disaster that is inevitable if this orgy of mad expenditure continues.

It is for these reasons, sir, that we make this motion

And so forth. In 1928 those observations were made by me in this chamber. Were they listened to? I recall one of the ministers that night while walking down from the house with another member and myself, saying: "Why is it that you always talk blue ruin about these matters?" I said to him then that I did not know whether this would come to pass in my

time or not. I was reminded again the other day by the third person that it was inevitable disaster would come if we pursued the course we were pursuing. That was the time that action should have been taken with respect to the capitalist system in this country. I urged it then. I urge it now. Not until this time have I had power or opportunity to carry into effect the necessary reform. I have not had the time to deal with the matter during the four long years I have been endeavouring to the best of my ability to sail this ship of state safely into the harbour through the dangers that have been encountered by us. Reference has been made by the right hon. gentleman this afternoon to what has been said by others. I can name leading Liberals in this country who have indicated to me in my office how grateful they were that I was at the head of affairs during those four years.

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LIB

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Mr. MACKENZIE KING:

The right hon. gentleman has made statements like this before. It is about time that he gave us the names.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

One of them is Mr. Burton, the head of the Simpson Company. I could give my right hon. friend a dozen others.

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LIB

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Mr. MACKENZIE KING:

Let us have them all.

Mr. BENNETT; I am not going to waste the time of the house in doing so. They are the very men who by reason of their general attitude toward public matters have ranked as Liberals, but they have rejoiced in the fact that we have been enabled to deal with the problems of this country as we have. I shall always regard it as a great privilege that in the period of greatest stress through which this country has ever passed, I have had an opportunity of rendering some service to the state.

There is not an hon. member in this house who does not know that during the last four years we were concerned with problems of recovery. We were concerned with the problem of saving the financial, the industrial structure of Canada. We were concerned with the problem of saving this country from absolute ruin, from bankruptcy. Day in and day out, week in and week out, month in and month out, year after year our concern has been the safety of Canada, the preservation of this country, the introduction of such measures of recovery as would enable us to pass through the stress and storm we encountered. It is a matter of satisfaction to me at least, if not to hon. gentlemen opposite, that other countries bear testimony to the fact that Canada emerged from this crisis better than did any

The Address-Mr. Bennett

other country in the world. So I say that when the evidence became clear that the greatest danger of the depression had passed, that the country was on the upward grade and moving towards complete recovery, I conceived it to be my solemn duty to introduce into this house such measures as I believed would prevent a recurrence in part of those dangers which we had encountered and those difficulties which we had to overcome. Have I had any opportunity to do this before? Has this government had any opportunity to do it before? Every hon. member knows in his soul better than that. He knows as a matter of fair play and justice that those were not the times when we could deal with these matters. That time was only when this country had shown some sign of emerging from the valley, not of humiliation but of depression and was coming back to prosperity. Now, with the opportunity-because if we have not a majority in the house we have not the opportunity-we are proposing to press forward those reforms in the capitalist system which, had they been passed in the years when the right hon. gentleman was in power, would not have left this country in the condition in which it was in 1930.

Is there an hon. member opposite who is not fair enough to realize the conditions that we faced in 1930? Does he recall the language of the then Prime Minister when he said there was no unemployment in Canada, when he read statistics to prove it? Does he recall that? Does he recall the trade balances of this country? Did' he see our exports diminish and our imports increase by hundreds of millions of dollars? Did he see this country sliding down to bankruptcy and insolvency? Was there a thoughtful man who did not see it and know it? Any country is like an individual; when its adverse balances increase there comes a time when they can no longer be redressed by borrowings, and ruin and disaster are the result. Is there a fair minded man in this house to-night who does not realize that this was the condition we faced?

When we had to succeed to those conditions there were before us two pathways; we had to deal with two matters. One was the immediate problem of employment and relief to the people of the country. I was not on the inside until August 7, but when I came into power on that date and we formed a government I learned what the real conditions were after I made the examinations, after I ascertained what the balances really were, when I learned of the contracts that had been let during the last ten days of the life of the

IMr. Bennett.]

administration that had preceded me, and after I realized the obligations and debts that had been created and that we must meet. Almost as soon as we took office we were confronted with the necessity of raising a loan of $100,009,000. Was that a light undertaking just at the time when conditions were breaking all over the world? We had to save the credit and solvency of Canada; we had to raise $100,000,000. One hundred million dollars was a large sum of money. We raised it in New York, and it cost us something over four per cent. It was a difficult task. On the one hand we had the increasing deficits of the railways. We had increasing unemployment. Relief measures were being demanded, and we had adverse trade balances which threatened our solvency. We borrowed that money and then we did the other thing; we passed legislation to provide for the immediate wants of the unemployed and for public works and undertakings to give employment, so far as might be possible, to those who required work. We did not know or understand then, as we did later, that this was not a continentwide but a world-wide condition, that it was growing worse from day to day, that in every part of the globe those conditions prevailed, that those who should have foreseen such conditions in this country had taken no steps at all to deal with them. In fact from time to time-and I will deal with the tariffs now- they had rejoiced, at Geneva and elsewhere, because Canada had lowered its tariffs twice since 1921. Yet, sir, when this government oame into office, the markets of the world in all the great countries were more closed against Canada than they .had been at any other period in her history.

Let me repeat that. The markets of the world were closed more against Canada when we oame into power in 1930 than they had been at any time in the history of this dominion. Think what that involves.

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LIB

James Layton Ralston

Liberal

Mr. RALSTON:

And we exported more

goods.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

We did not export more goods. As soon as the depression began we exported less goods, and the last tariff that was placed against us by the United States of America radically changed our exports, as the hon. gentleman should know. The tariffs placed against us by France in 1930, while hon. gentlemen opposite were in power, limited and restricted our exports. The tariffs of Germany restricted our exports. In all the great countries of the world there was a complete restriction of our exports going on from day to day, reaching its full height in

The Address-Mr. Bennett

the years that came after, while there had been no changes in the tariffs of those countries until we were able to secure better terms from them than prevailed when we came into office. Let it be known that the restrictions that France raised against us reached their very highest when we came into office. Let it be known that a treaty has been negotiated with that republic under which we receive preferred treatment with respect to many commodities. Let it be known that we have negotiated treaties with Germany, with Austria and with other countries in Europe under the same conditions, and now we are negotiating a treaty with the United States of America.

This afternoon the right hon. gentleman suggested that this was a deathbed effort on our part. Let me ask him this: When he was in office, in that very year when the United States was raising its tariffs against Canada higher than they had been at any time in our history; when our people were suffering as they had never suffered before, because of the loss of that market to our agriculturists and others, what did we find him doing? He was standing in this very place, and the right hon. gentleman dared to say to the Canadian people, "Do not provoke them; we must not raise our tariffs against them." Let there be no misunderstanding.

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LIB

Wilfred Hanbury

Liberal

Mr. HANBURY:

It did not take you long to provoke them.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

That is not so, for there has been no increase in the tariffs of the United States against us since we came into power.

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LIB

Wilfred Hanbury

Liberal

Mr. HANBURY:

I would ask the right hon. gentleman if there was not an excise tax.

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LIB

Peter John Veniot

Liberal

Mr. VENIOT:

What about the increase in the duty on lumber?

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

There was no tariff increase on lumber, for there has been no touching of the tariffs by the congress of the United States since we came into office. Any hon. gentleman who takes the trouble to read the records knows that.

Mr. HANBURY': Just an excise.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

There was not a tariff increase against lumber.

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LIB

Wilfred Hanbury

Liberal

Mr. HANBURY:

That is a play on words.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

There is no play on words; the president of the United States has put himself clearly on record as stating that there was no interference with tariffs by congress after 1930.

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LIB

James Layton Ralston

Liberal

Mr. RALSTON:

Just a $3 tax.

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CON

Richard Bedford Bennett (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Conservative (1867-1942)

Mr. BENNETT:

There was an excise tax, of course, of which I am aware, but I would point out to this house that there was no tariff legislation; that is a fact.

Now let us go a step further. We opened up markets for lumber in the United Kingdom on a scale that had never been known before, and this gives me an opportunity to say what I want to say just here. By the introduction into the Ottawa agreements of a provision with respect to unfair competition we were able to secure for this country a favoured position. Now I come to the attitude of the right hon. gentleman opposite, who this afternoon said that the majorities secured by his recently elected supporters were obtained after the Ottawa agreements had been in force. Those agreements expire shortly, and we are told by those who are urging upon the British government the necessity for action that the lumber people say that the leader of the opposition in Canada says he is the man who should be in power, and that he has embarrassed and hurt this country in its dealings with the lumber industry. Not only has he embarrassed Canada but he has destroyed, to a very large extent, through the representations made by him and his friends, that which we were able to secure.

We will continue to fight that sort of thing, for I do believe that the Canadian people are coming more fully to realize just what has been meant by the opposition of hon. gentlemen opposite to the Ottawa agreements. In season and out of season they have exerted their force agamst them. They have said, as I shall show presently, that if they were in office they would repeal them, that they would destroy them. The fact is that they have endeavoured, and to a large extent succeeded in doing so, to build up in the old country the idea that the Canadian people are opposed to those agreements and that therefore they are no longer sought or desired. I ask hon. gentlemen opposite, do you wish these agreements or not?

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January 21, 1935