March 11, 1937

CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

That is the inference from what the hon. gentleman said.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB-PRO

Joseph Thorarinn Thorson

Liberal Progressive

Mr. THORSON:

It is not a proper inference.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

I take the hon. member's word for it, but that is what I gathered from what he said. I do not know how you can reduce the manufacture of woollen cloth in Canada, through the importation of such goods, and still expect a man to buy a suit of clothes from the old country or anywhere else and another suit from cloth made in Canada. I cannot figure that out. As has been said many times in this house, and more

The Budget-Mr, Edwards

recently by the hon. member for Lanark (Mr. Thompson), the woollen industry is located in small centres of population and its success must be assured if those who are engaged in it are to survive. There are 500 mills of all sorts throughout Canada located, roughly speaking, I believe, in 150 different cities, towns and villages. In the district of South Waterloo, which I have the honour to represent, there are a number of large industries -quite large-one employing over 800 hands, another 600, another 300 or 400. and so on, and I want to pay this tribute to the textile business and as well to the government that imposed the tariff at the short session of 1930. During the depression years, when in 1933 twenty-six out of every hundred men were unemployed, the textile business saved the situation as far as our part of the country was concerned. In many cases where the girls and women of the household were working in the textile mills supporting the home the father or the sons were out of work. And that happened not in a few eases, but in hundreds of cases that I know of, and in more that I have been told about. Prior to 1930 these mills were working on short time, and in fact in many mills the yarn department was completely closed down. In 1930 the industry was given a break by the tariff imposed by the Bennett government. Prices on cloth-I wish hon. members would get this-[DOT] were in many instances definitely lowered, and the mills were busy because they were able to obtain between 75 and 80 per cent of the home market. The industry did not take advantage of the protective tariff to raise prices but actually lowered them by reason of the fact that they were able to produce more, thereby reducing operating cost per unit.

Canada is a country in which woollen garments are worn during a great part of the year. Our position is such that we require woollen clothing. Surely hon. members will admit that where the people wear woollen clothing six or seven months of the year it can be truthfully said that the woollen industry is indigenous to Canada. I have heard it said so often in this house that goods should come from the place where they can be produced cheapest; for example that woollen goods should be brought from the United Kingdom. But will anyone say that the rubber industry, for example, is indigenous to the United States? Yet look at the tremendous business they have built up in that line. Or can it be said that the cotton industry is indigenous to the United Kingdom? Yet look at the enormous development of that industry which has taken place there. If our manufacturers are to be deprived of the busi-

ness I have mentioned it is going to be just too bad for the 63,000 workers at present engaged in it, together with their dependents. I have not a great deal to complain of in regard to the tariff reductions made and the renewal of the empire trade agreements, so long as our mills are able to secure something upward of sixty per cent of the business. I do not think there is any particular danger so long as that protection is given them. But if we get below sixty per cent of the home market there is very great danger. Surely the manufacturers and workers of this country are entitled to sixty per cent of the home market.

Much has been said about the cost of clothing having been high on account of the tariff. This is definitely not true. If the yarn is brought in to be manufactured into cloth at the 121 per cent duty on the yarn-and it is still lower now with the specific duty off-it will not affect the consumer. I think hon. members will be surprised to learn that the duty on the yarn used in a finished suit of clothes valued at say. $40. is less than 80 cents. Who will say that the 80 cents imposed by the tariff makes any appreciable difference in the cost of the $40 suit? If the cloth is brought in, in the form of worsted, 3i yards to a suit, the duty is not more than $1.75, figuring 16 ounces to the yard of cloth. Would any hon. member say that the $1.75 imposed by the tariff gets to the consumer? Never; it is taken up in the manufacture and in profit to the retailer. The cost of clothing is not in the price of the cloth to any large extent. In a $40 suit of clothes the cloth represents somewhere between $10 and $12; the difference is made up by labour, overhead and the clothing manufacturer's profit. If this protection is taken away it means throwing all these thousands of people out of work, with no benefit whatever to the consumer.

Prior to 1930 sufficient cloth was brought into this country to make a suit of clothes for every adult male in Canada per year. Would anyone say that that was giving the home manufacturer too much of his home market? What was left, when sufficient cloth was brought into Canada prior to 1930 to make a suit for every adult male in the country? When the higher duties were imposed in the short session of 1930 a lot of that was shut off. and jobs provided for thousands of people. May I give the figures of employment in the textile industry from 1930 to 1936?

1930- 50.2G3 on part time.

1931- 50,931 on part time.

1932- 51.030 on part time.

1933- 52.753 on full time.

And so on up to 1936 when there were 63,800 textile workers working full time. That

The Budget-Mr. Edwards

was at a time when out of every 100 industrial employees 26 were unemployed. I repeat, the textile industry did a real national service for Canada.

Perhaps at this stage a comparison of wages paid in the United Kingdom with those paid in Canada, as brought out by the Turgeon textile commission, would be useful:

Cents per hour Canada Great Britain

Woollen industry. .. 30-19 16-90Cotton industry.. .. 26-64 16-58Carpet industry.. .. 36-28 18-98

The textile industry continues as an integral and valuable part of the industrial fabric of Canada, in the wages it disburses, and taxes it pays, and the amount it expends for freight and other services. It maintains a substantial part of the population of this dominion. So much for the textile business.

I regret, along with other hon. members, that it was necessary for the finance minister to retain taxation on the high level that it is. The sales tax and the excise tax have been fully retained; other taxes, particularly corporation taxes, act as a severe handicap on business.

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

John Alexander (1874-1948) Macdonald

Conservative (1867-1942)

Mr. MACDONALD (Brantford):

You do not want the excise tax taken off, do you?

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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

No, but if the hon. member will wait a minute I will give him a solution. This high taxation is indirectly responsible for a lot of the business worries of industrial concerns to-day, and directly and adversely affects the employment situation. I realize, of course, that these taxes must be imposed under present conditions; there is no doubt about that. But I make a suggestion, for whatever it is worth. I suggest to the minister that prior t-o bringing down the next budget, careful consideration be given to the idea of putting into force the turnover tax as a substitute for many of the nuisance taxes which we have to-day. I realize that this suggestion will require considerable study, but I leave it with the minister, after quoting part of a speech made some years ago by Sir Edmund Walker, addressing the annual meeting of the Canadian Bank of Commerce. He said:

"A small tax on the sales of commodities and real property in Canada would hurt so little, would be so fair, would be so easily collected, and would produce such a very large sum that to fail to levy it seems excusable only if it can be shown to be impracticable."

I leave this quotation with the finance minister to ponder. It is not anything new, but I think it is worthy of consideration.

I should also like to suggest to the government, in view of the recent decisions given

by the privy council, that during the recess a real honeslt-to-goodness attempt be made by this government and the provincial governments to get together and devise some plan under which social legislation may be made workable on a national scale. I refer particularly to the minimum wage act, unemployment insurance, and old age pensions. Although of course it has been decided that these are provincial matters, I do not see how they can be successfully handled in any disjointed way, and I suggest that every effort be made to place them on a uniform national basis.

The home improvement act is to be commended. I commend the Minister of Labour for that; I think it is beginning to show good results in the building trades. It has been stated that 83 per cent of the cost of building is labour, so that it means a great deal for the working men and mechanics of this country-and not only those actually engaged in the building trades; it goes much further back. The hon. member for Brantford I think will back me up when I say that it goes back to the machine shops; there it is very noticeable. I suggest, however, that the interest rate on these small loans should be reduced to the minimum.

The suggestion has been brought forward by several hon. members that a duty or quota or both should be imposed on vegetable oils coming into Canada, and as a result I have received many communications from farmer constituents asking what will be done. From what I can gather, the importation of vegetable oils from foreign countries is an ever-increasing menace to the butter fat producers of Canada. This question is now before the tariff board, and careful consideration should be given the findings of that board. If the threat to our dairying interests is as great as it is reported to be, I suggest that action should be swift and sure.

Last session I protested against the reduction in the duty on furniture coming into Canada from the United States under the agreement. I want to tell the house to-day that the fear I then expressed has been abundantly justified. The furniture industry in Canada is in very bad shape. I do not say this is entirely because of our imports from the United States, but that has been a major contributing cause to the troubles of the furniture industry. I was informed lately, and I believe the information to be correct, that either the government of the United States or the governments of individual states, I do not know which, have subsidized factories that had been closed in large centres in the United States of America. These factories

The Budget-Mr. Edioards

have been reopened and a good deal of the output is coming to Canada. To quote statistics again, imports of wood furniture for 1935 amounted to $286,746. In 1936, following this agreement with the United States, they amounted to $663,634; in other words they were about three times as great. For January of this year, the last month for which complete figures are available, wood furniture valued at $84,001 entered Canada from the United States, and this at a time when the industry here is struggling for existence.

I am surprised that many other hon. members of this house have not brought this serious situation to the attention of the government. There are very few Conservative members representing ridings in which furniture is made, but many Liberal members represent constituencies in which there are large furniture factories. All these members need do is go and inquire as to the facts, as I have done in several cases. Let them go into these factories; let them find out what the situation really is; let them see the reason for the low wages that have been paid and the strikes that have occurred. If they do that I believe they will have something to say to the government which they support, if they do their duty by their constituents.

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

Frederick George Sanderson (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

Mr. DEPUTY SPEAKER:

Order. I must tell the hon. gentleman that his time has expired.

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

Some hon. MEMBERS:

Go on.

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

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

We hear a great deal about the high protectionist policy of the Conservative party, but right here I say, with no fear of successful contradiction, that this is an absolute myth, that it is not true. As I understand it. the tariff policy which I support is one that asks a tariff simply sufficient to equate costs as between Canada and the country that is competing with us in order to give our manufacturers a fair break. That is all.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
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LIB-PRO

Joseph Thorarinn Thorson

Liberal Progressive

Mr. THORSON:

Since when?

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

That has always been our policy; that has always been the attitude of the Conservative party, but the high tariff bogey always has been used by the Liberal party as a peg on which to hang the argument that ours is a high protectionist policy.

In closing, Mr. Speaker, may I again suggest that the government give greater consideration to the balancing of business instead of paying so much attention to the exportation of any particular commodity. Only by adopting this principle may we expect to relieve the treasury of the terrific burden caused by the unemployment situation.

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

Wilfrid Gariépy

Liberal

Mr. WILFRID GARIEPY (Three Rivers):

Mr. Speaker, as a Liberal of independent leanings representing a riding with a strong labour complexion I wish at the outset to congratulate the government upon having appointed the textile investigating commission. It has been a blessing to the country. We have been very fortunate in having as chairman of that commission a gentleman of high culture, integrity and energy, assisted by counsel, Mr. McRuer, a leader of the Canadian bar, well equipped to bring out the facts, and ably supported by a leading member of the Montreal bar, Mr. Beauregard. While the report of the commission has not yet been presented, sufficient evidence has been adduced to enable us to draw some conclusions. In the first place, the real capital invested in these factories has never been properly disclosed. Second, in many cases the profits were hidden.

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

Charles Hazlitt Cahan

Conservative (1867-1942)

Mr. CAHAN:

Mr. Speaker, on a point of order; I would ask for your ruling whether it is open to members of the house at this time to discuss a subject now under investigation by a royal commission with respect to which no report has as yet been received or laid before the house. It is unprecedented that such a matter should be discussed prior to a report being made by the commissioner.

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

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

Liberal

Mr. LAPOINTE (Quebec East):

I quite agree with my hon. friend, Mr. Speaker, but I am sorry he did not raise the point when the investigation was being criticised by members on his side of the house.

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

Charles Hazlitt Cahan

Conservative (1867-1942)

Mr. CAHAN:

I was not here; I heard no such criticism.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
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LIB

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

Liberal

Mr. LAPOINTE (Quebec East):

My hon. friend is correct in his point of order, I think, but the commission was criticised by many speakers on the opposite side of the house.

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

Charles Hazlitt Cahan

Conservative (1867-1942)

Mr. CAHAN:

If there has been any backwardness on the part of members to raise objection, I now raise it distinctly, and I ask for a ruling. Otherwise we open the door to a discussion that may last not weeks but months.

Topic:   THE BUDGET
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LIB

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

Liberal

Mr. LAPOINTE (Quebec East):

I agree with my hon. friend, but I do not congratulate him on his impartiality.

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

Charles Hazlitt Cahan

Conservative (1867-1942)

Mr. CAHAN:

I would ask for the Speaker's ruling.

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

Frederick George Sanderson (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

Mr. DEPUTY SPEAKER:

I shall take the point of order raised by the hon. member for St. Lawrence-St. George (Mr. Cahan) under consideration, and give my ruling later.

Topic:   THE BUDGET
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LIB

Wilfrid Gariépy

Liberal

Mr. GARIEPY:

It follows clearly. Mr. Speaker, that the high tariff which has been in

The Budget-Mr. Gariepy

existence for the protection of the textile industry had not its raison d'etre, was not a real need, and that the arguments presented to this house and the country were without any real foundation. Conditions of labour warranted the complaints that were being made throughout Canada, and it seems to me it was a step in the right direction when last session the attention of the house was directed to the strike of employees of the Wabasso Cotton Company in Three Rivers. In my view the complaint invited some remedy. No doubt cognizance of the circumstances has been taken in the preparation of the budget, which on the whole I would say is well balanced. It includes provisions which are compatible with real progress, and the budget presentation was on a par with budget speeches made in the past by such leading statesmen as Mr. Fielding and Mr. Robb.

The present Minister of Finance (Mr. Dunning) has a knowledge of both western and eastern conditions. I knew him before he became a member of the legislature of Saskatchewan and I believe he may well take credit, with the means at his disposal, for rising through sheer ability and force of character to the important position he now occupies in the government.

I listened with keen interest to the observations yesterday of the hon. member for Ontario (Mr. Moore). He knows his subject, and many of the statements he made will not suffer contradiction. But this is not an idealistic world; we must face facts and conditions. If external trade is to be developed, agreements are essential, and the government is to be commended upon what it has done in that direction. It has effected agreements with the United States and with the mother country. I would go a step farther and say that before long I hope that similar agreements will be made with Belgium and with France. By the way, one does not hear much about Canada's representative m France. Our present representative the Hon. Philippe Roy, is an old friend of mine, but his physical disability, I think, deserves the attention of the government. Though diplomats should not always be listening, they must be able to hear. I suggest the time has come when improved representation of Canada in France should be made. I do not say this by way of criticism, but with all due respect I suggest that the members of the government are broadminded enough to expect hon. members addressing the house to speak their minds.

One matter which I think requires attention is with respect to answers given to questions placed on the order paper. Owing to pressure

of business, ministers must leave to their departmental officials the duty of answering these questions. Perhaps the officials do not understand the mentality or sufficiently consider the atmosphere of the house. A few daj's ago the hon. member for Quebec-Mont-morency (Mr. Lacroix) asked what steps were being taken against communism in Canada. The answer given was: "Such means as are proper for the preservation of peace and order." I say that does not go far enough; it is not satisfactory. If the government had said, "For reasons of state we cannot disclose the situation," that would have been understood, but when same answer is attempted to be given we should be told in all frankness whether or not something is being done. I have it on good authority that in the city of Montreal there are at least two hundred communist clubs with active memberships, initiations, recruiting organizations and all the various means of propaganda. After visiting my home constituency of Three Rivers last Saturday, I can vouch that in that part of the province in season and out tons of communist literature are being distributed. I am not an alarmist, nor do I mean to suggest that this alone will bring about revolution in a, month or a day; but the point is that we in parliament should keep our eyes open. The matter should be investigated more than it seems to have been, if we may judge by reports received in the house.

Topic:   THE BUDGET
Subtopic:   CONTINUATION OF DEBATE ON THE ANNUAL
Sub-subtopic:   FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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March 11, 1937