May 3, 1939

SC

Percy John Rowe

Social Credit

Mr. P. J. ROWE (Athabaska):

Mr. Speaker, the Minister of Finance (Mr. Dunning), when presenting his budget last week, estimated the total national income of Canada as $4,460,000,000. Assuming that there are 2,500,000 families in Canada; if this total income were divided equally, it would mean an income of $1,785 a family. The Loeb survey of the potential productive capacity of the United States in 1934, after making a survey of the machinery on farms and in the factories of that country, came to the conclusion that the American people, without altering their industrial equipment, could produce the equivalent of $4,400 for every family in the United States. It has been stated in this house-the Prime Minister (Mr. Mackenzie King) is one of those who have made the statement-that Canada is a very rich country, more blessed by providence than any other country on the face of the globe. If that is correct, and I believe it is, I am sure that if a commission were appointed to make a similar investigation in Canada it would find that our potential productive capacity was even greater than that of the United States, that is, if scientific methods of production were applied.

Our present income, as I said a moment ago, is $4,460,000,000, but on the basis of $4,400 a family our national income would be $11,000,000,000. Of course the national income is not evenly divided and I am not suggesting that it could or should be, but it is clear that we are losing the difference between our present national income of $4,460,000,000 and what it would be if we operated our economic system on a cooperative basis and applied engineering principles to the production and distribution of wealth.

How is the national income of Canada divided? I want to spend a minute or two on that. I gave this analysis once before to the house, but in order to bring out my argument at this time I shall review the figures again. According to the brief submitted to

3524 COMMONS

The Budget-Mr. Rowe (Athabaska)

the Rowell commission by the Manitoba government, our income for 1934 was $3,580,000,000, slightly lower than the 1939 income but not very much. The 1931 census is the latest official record that we have available. Applying the 1934 income to the distribution of population shown in that census we find that 23,600 families, or six-tenths of one per cent of the population received $940,000,000, or $39,000 per family. We find that 4,000 families, or one-tenth of one per cent of the population, received $600,000,000, or $150,000 a family. At the other end of the scale we find that 36 per cent of our population, or 895,000 families, received $181,000,000 or $202 per family. We find that 1,617,000 families, or 65 per cent of the population, received $582,000,000, or $360 a family. We thus see that the 4.000 families at the top of the scale representing one-tenth of one per cent of the population received $600,000,000, or $150,000 a family per year, or $18,000,000 more than the 1,617,000 families at the bottom of the scale representing 65 per cent of the working population.

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

Charles Avery Dunning (Minister of Finance and Receiver General)

Liberal

Mr. DUNNING:

Would my hon. friend give the authority for those figures?

Topic:   THE BUDGET
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SC

Percy John Rowe

Social Credit

Mr. ROWE (Athabaska):

As a basis for my calculation I am using the brief submitted to the Rowell commission by the Manitoba government and giving an estimate of the 1934 income as $3,580,000,000. I am distributing the 1934 income on the basis of the 1931 census.

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

Charles Avery Dunning (Minister of Finance and Receiver General)

Liberal

Mr. DUNNING:

How does that reveal

the amount that each family got?

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SC

Percy John Rowe

Social Credit

Mr. ROWE (Athabaska):

The distribution is made on that basis in the 1931 census, and I am using the distribution in ratio to distribute the 1934 income. According to the same distribution, the farmers of Canada received $474 a family. I should like to indicate what the Brookings Institution have to say about an adequate standard of living on the basis of income. I quote from a book entitled, Income and Economic Progress, by H. C. Molton. In discussing the figures of the Brookings Institution at page 78, where reference is made to an income of $2,500 a family, he says:

This, as our studies have indicated, is not adequate to provide the necessities and comforts requisite to a satisfactory standard of life.

I quote that statement to indicate the very great distance we are from an adequate standard of living. It is clear that we are suffering from several evils among which are:

1. The fact that nearly 1,000,000 of our people, or over 9 per cent of our population, are on relief and not producing anything. These

people must be fed, clothed, housed and otherwise cared for by the rest of the workers. The workers, farmers and fishermen must provide for their own families and a million idle as well.

2. A large percentage of the workers are employed only part-time and are not therefore allowed to produce their full quota of wealth.

3. A large number of workers are engaged in the manufacture of counterfeit, spurious and useless goods, and I shall deal with that later. While engaged in these useless and even harmful tasks they must be clothed, fed, housed and otherwise cared for by the producers of food, clothing, building materials and other necessary services.

4. A large number are engaged in the production of gold, which is useless because it cannot be eaten, worn or used for fuel, and therefore every ounce of material and energy expended in its production is wasted. But those who produce it must also be clothed, fed, housed and otherwise cared for by the producers of useful consumable wealth. I refer to those underpaid and unpaid burden bearers, the farmers, workers and fishermen of this country.

5. A large section of our population is engaged in the production of war materials, which are useful only for the destruction of life. Our exports of nickel to Germany increased over 1000 per cent between 1932 and 1938, according to the Dominion Bureau of Statistics, and our exports of nickel to Japan in the same period increased 5000 per cent.

Under the present system of competition we have by our trade agreements, discriminatory tariffs, et cetera, strangled the "have-not" countries until we drove them mad, then placed guns in their hands and provided them with the means of murdering their boys and ours.

What then are the charges which may fairly be brought against the present price-and-profit system? I charge it with the following fundamental evils, which are inevitable and not accidental consequences of the system:

1. It has permitted extraordinary inequalities in the distribution of wealth and income, inequalities which carry with them the great extremes of luxury and abject poverty.

2. Huge monopolies have developed under it, and competition has become increasingly imperfect. This has resulted in the exploitation of consumers and workers, has reduced production and helped to create unemployment.

The Budget-Mr. Rou-e (Athabaska)

3. In the competitive industries widespread losses and waste of energy are everywhere apparent.

4. Business depressions with their attendant miseries are the product of competition. There is no evidence that they will be abolished or greatly reduced so long as that system is retained.

5. The profit system, by its emphasis upon self-interest, greatly lowers the moral tone of mankind. In business it forces men into greedy acquisitiveness. In private life it leads to competitive consumption. In politics it creates corruption. In the field of international relations it fosters war. It is admitted that the profit system in its earlier days furnished a powerful direct stimulus to effort, but large scale industry has removed this incentive from the vast majority of the urban population. They are employed by large corporations and neither receive profits nor have any real chance of becoming masters of their own business and of receiving profits in the future. Nor are the prospects of controlling combines and corporations any better.

In 1890, when the Sherman anti-trust law was passed in the United States, making monopolies a crime, less than ten per cent of United States business was controlled by trusts. In 1938, after forty-eight years of prosecutions and "trust-busting" crusades, more than seventy per cent of United States business is controlled by the trusts. The truth is, of course, that a monopoly is not the cause of anything but simply the inevitable consequence of competition.

I often hear it argued that if we established a cooperative society there would be regimentation, confiscation and loss of liberty. I answer that the unemployed are now being regimented in soup-kitchens and construction camps, without liberty or choice of action of any kind. They are not free to choose what they will eat or wear, or where they will live, nor can they make any plans for the future for themselves or their children. Neither is there any freedom for the farmers and the workers of this country. How could there be on an average income of less than $600 a family?

Under a cooperative system, on the contrary, instead of having their homes confiscated as now through unpayable debts, they would have a chance, both in the country and in the cities, to build and own real homes with all the comforts of life which science and invention could give them. Far from having their property and rights confiscated, the working class would have a chance for the first time in history to acquire from six to eight times the property they now have. It

is true that a cooperative society would entail obligations. No civilization is possible without the voluntary acceptance by individuals of rules and restraints under which the rights of all would be guaranteed. But in this case there would be something to work for. Twenty-five years ago the people of this country offered their lives for what they thought was democracy and freedom, thus proving beyond doubt their willingness to suffer and sacrifice for a great cooperative ideal. They discovered, to their bitter disillusionment, that the only freedom they won was the freedom to starve and wander unfriended through the wastes of a desolated land, sick in body and mind, clothed in rags, and suffering hunger and heartache as the single unemployed are doing in Ottawa tonight while I speak. I have faith that the young men and women of Canada are ready and willing to support a cooperative commonwealth, where the nickel, copper, iron and lumber which this country possesses in such great abundance will be used to minister to the needs of ourselves and our neighbours in other countries, instead of to murder them for the profit of a few as we are doing now.

Why are the defenders of the present system so afraid of planning? There is not a person in this dominion who does not plan every day of his life. Just as the Minister of Finance must plan his budget, which is simply a summary of the income and expenditures of the government, so must each family head plan with the utmost care how the family income shall be spent. The parents know how much they expect to receive by way of income during the year, and so they estimate so much for food, clothing, education, religion, entertainment, travel, et cetera, and everyone knows that failure to plan in this way means disaster. Similarly the business man plans his business, the farmer his farming operations, the housewife her food menus and shopping, the public man his speeches and meetings. If planning is so indispensable in our personal lives, not to mention schools and other public organizations, by what process of reasoning do we conclude that the community, the nation, or the community of nations, can go planless without inviting chaos? When we consider the completely interdependent nature of our relationships in trade and industry and our dependence upon other nations for certain vital materials as well as their dependence upon us to an even greater extent, the conclusion is inescapable that constructive cooperation, mutual aid, and common sense planning must replace the present blind, chaotic, destructive combatancy-

3526 COMMONS

The Budget-Mr. llowe (Athabaska)

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Subtopic:   DEBATE OX THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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LIB

Olof Hanson

Liberal

Mr. HANSON:

If the hon. member is going lo read his speech, Mr. Speaker, I would ask him to read louder so that we can hear it.

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LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

I do not think the point of order is well taken. I do not think the hon. member is reading his speech. He might be referring to his notes.

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LIB

Olof Hanson

Liberal

Mr. HANSON:

Then let him speak louder.

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LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

I do not think he can speak louder. If there were less noise, everybody could hear him.

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SC

Percy John Rowe

Social Credit

Mr. ROWE (Athabaska) :

Thank you, Mr. Speaker, for coming to my assistance. I am trying to speak as loudly as I can.

As I said, the conclusion is inescapable that constructive cooperation and mutual aid must supplant the present blind competitive chaos if civilization as we know it is to survive.

The advocates of planning under the price and profit system, whether big business men or those who call themselves Liberals, all seem to overlook a number of important though simple facts. First, capitalism is a system of competition and not of cooperation. Second, business lacks orders for goods, not plans for the production of goods. Third, purchasing power cannot be increased by lending. Business men have always planned. Never did business men plan with more expert assistance or better information than during the past ten years, and never were greater financial follies committed. Our present situation is the result of business planning. But planning for scarcity can succeed only by making things scarce, so that the price may be kept up in order that profits may be made. Abundance of anything means calamity for the price and profit system ; and you can no more plan for scarcity and get abundance than you can mix oil and water. Therefore, planning for profit can never be done scientifically. The better the planning for profit, the more certain is the result- profitless business.

May I now for a moment or two turn to an examination of some harmful activities of our present system, things which must be eliminated before a planned economy can be established. The first and greatest is, in my opinion, the one which the Minister of Finance would only make worse if he succeeded in persuading persons with capital to create new capital goods where there is already a plant capacity in excess of presently effective consumer demand. How can he expect the new factories which might be erected under this plan to sell their output, when the output of the present factories cannot be effectively disposed of? I have stated that the present plant capacity to produce goods exceeds the

presently effective consumer demand, but I have already pointed out that the potential product capacity is eleven billion, while the present production is five billion or less, and the difference undoubtedly could be consumed if it were produced and equitably distributed.

Not long ago a large cement plant was dismantled in Alberta and shipped to Japan. That was not because no more cement was needed in Alberta, but because the effective consumer demand had fallen off. The railways are now talking of tearing up certain parts of their lines. When I was in Edmonton a couple of weeks ago I attended a meeting of farmers and business men who were protesting against the proposed tearing up of a considerable section of the Canadian National railway. They had invested their life-savings, had worked for twenty years, and were faced with the possibility of losing their entire livelihood. I suggest that is a retrograde step. We are not using our present capital equipment. We are using only a fraction of it. The present capital equipment is capable of providing a good living for everybody, but it is not being used. Why should we tear it up and destroy it until we can demonstrate that we have used it for the purpose for which it was created, namely, to provide the people of this country with a living.

There is plenty of capital in Canada. Capital is not the problem. I have here a classification of deposits which I should like to read into Hansard. This classification is based upon an analysis made as of October 31. 1938, of deposits payable after notice. I find here that there rvere 4,122,963 savings deposits in the chartered banks of Canada, but 3,797,481 of them have an average of only $119, a total of $452,808,233.46. Coming up the scale, I find that 284,243 persons have an average of $2,011; 38,077 persons have an average of $8,692; 2,541 persons have an average of $44,030; and 621 persons have an average of $298,285. This means that investors have plenty- of capital to invest, but there is no assurance that if that capital were invested in new production goods, factories and so on, the output of those factories could be disposed of. The reason why a great deal of that money is there is that there is no lucrative channel of investment for it. Therefore, I say, the first great difficulty we are facing to-day is this: People rush blindly in to

compete when excess capacity already threatens the industry.

Mr. Stuart Chase, in his book, The New Deal, shows that 111,000 service stations distributing gasoline in the United States, out of a total of 157,000, are unnecessary, ana

The Budget-Mr. Rowe (Athabaska)

the waste or loss in materials and labour amounts annually to $450,000,000 as a result. This is an illustration of the overlapping and competitive chaos resulting from planlessness, and runs to a greater or less extent through all the fabric of our economic life. Business men have almost no knowledge to-day of production capacity in relation to market demand. With touching optimism, particularly when prices are relatively high, they feel that the new plant or organization which they are about to build is bound, as a result of their superior skill, to take business away from those already in the field, and to prove profitable. This continuous avalanche of new capital into a territory already thickly settled, results in over-production, unemployment, profound maladjustment, and an appalling industrial death rate. The secretary of any active trade association can furnish full details on this point. Money is indeed made, but in a closed market; an equal amount is lost, while the economic structure reels dizzily with repeated blows in a vital spot.

Under our present system there are various ways of making money, all of which operate to the injury of society, all of which make fearful inroads upon purchasing power, none of which could be permitted under a planned economy, and indeed, all of which must be eliminated before a planned economy can be established. It would be necessary to speak for forty minutes on each of these points in order fully to outline each one, but I shall mention some of them briefly, and possibly discuss them more fully at another time.

The foundations of a great many fortunes on this continent have been laid through the creation of monopolies and the raising of prices; the tying up of a patent or a secret process, and charging all that the traffic will bear; the ingenious overcoming of the interest rate in selling credit to the poor. Recent discussions on small loans brought out many startling facts in this regard. The saddest commentary I can make on that is that poor people must pay 26 per cent for money which they need desperately for vital things, while people in better circumstances can get credit at from four to seven per cent.

The manufacturing of a useless, adulterated or even vicious product, and the creation of a demand for it by high-pressure selling and advertising, must be familiar to us all. A toothpaste containing a poisonous chemical may be worth a million to its owners so long as it tastes good and its owners broadcast amusing radio features. Then there is the method, closely akin to this last-mentioned abuse and far more common, of creating a 71492-222

demand for a product which, good in its modest way, deserves no such price as is asked for it and no such use as advertising blasts out for it. According to the American Medical Association, menthol, mixed with alcohol and oil of lavender, is bottled and ballyhooed as giving relief for colds and sold at more than fourteen times the price of the original ingredients. This practice is widespread.

The creation of new fashions in costumes, of fads and novelties, and the astute manipulation of social pressure to market them is another striking feature. One branch of this method has been coarsely called the "annual model racket," applying particularly to the automobile. This includes the sale of smart forms of entertainment. Our recreation is being poisoned by mechanization and commercialization. Arid and unrewarding forms of play are being substituted for direct participation, clicking turnstiles for open hillsides. The manufacture and manipulation of more or less dubious stocks and bonds and the unloading of these upon the public by high pressure methods, are on all fours with the methods employed in connection with patent medicines. In this division there is normally no tangible property at all behind the brightly engraved certificates. The bulk of investment trust securities are a case in point. The men who manufactured these millions of par value paper in the last twenty years were not conscious of any wrong-doing; they merely saw an opportunity to make quite legally a large amount of money. The fact that their activities dried up needed demand for consumer goods, helped to bring on the crash of 1929, and made it worse after it came, was quite beyond their limited vision-an academic point that never touched them.

Topic:   THE BUDGET
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LIB

Olof Hanson

Liberal

Mr. HANSON:

I rise to a point of order, Mr. Speaker. I have no objection to the hon. member reading his speech, but on account of the noise in the chamber I cannot hear what he is saying.

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LIB

Walter Edward Foster (Speaker of the Senate)

Liberal

Mr. SPEAKER:

It does not seem to me that the hon. member who has the floor is reading his speech; so far as I can see he is merely consulting his notes. I must repeat, however, what I have directed to the attention of hon. members on many occasions, that there is far too much noise in the chamber. If hon. members would converse in lower tones we could hear better.

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SC

Percy John Rowe

Social Credit

Mr. ROWE (Athabaska):

I thank you, Mr. Speaker, I am having a little trouble with my throat and I am sorry if the hon. member cannot hear me.

3528 COMMONS

The Budget-Mr. Rowe (Athabaska)

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Subtopic:   DEBATE OX THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CON

Robert James Manion (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MANION:

Send him Hansard tomorrow.

Topic:   THE BUDGET
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SC

Percy John Rowe

Social Credit

Mr. ROWE (Athabaska):

Topic:   THE BUDGET
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CON

Robert James Manion (Leader of the Official Opposition)

Conservative (1867-1942)

Hon. R. J. MANION (Leader of the Opposition) :

Mr. Speaker, I should like to join with other hon. members who have expressed pleasure at the recovery of the Minister of Finance (Mr. Dunning), and the pleasure of the whole house at seeing him looking quite healthy and still in his seat.

The budget, sir, is always awaited anxiously, because like one's own personal budget the national financial statement is the people's business. It is more our business than any other matter except those that concern our own personal affairs. It is the nation's balance sheet, reviewing the past and forecasting the future, indicating particularly whether any new taxes are to be levied or any existing taxes removed, whether there are to be any tariff changes that may affect us all. This budget has been described many times in this debate as colourless and innocuous, and the favourite description seems to have been that it is a dismal type of budget. With that I wholly agree; for it has been a disappointing budget in its results, barren of ideas and lacking entirely in originality. In that sense it is, to my mind, the weakest budget we have had in this house in the last twenty-five or thirty years.

There is sufficient reading matter in the budget, if one reads the tables, to occupy about three hours, yet only one idea was suggested, beyond pious platitudes and oratorical appeals for courage and leadership, which the minister himself and the government seem to lack, and appeals to business, which business seems somewhat to resent. The one idea was that of deducting from income tax for the next three years capital expenditures made by business concerns during the present year. That proposal has been played up, and is the only idea in the budget that is at all out of the ordinary. But I point out this: Of course the Minister of Finance could not know that it is not a new idea; it is an idea we considered when we were in power. I do not remember the year, but I think it was in 1934 that we considered the idea very fully and decided it was not a proper provision to incorporate in the budget at that time. However, that is neither here nor there.

But in the national employment commission report made to the government on January 26, 1938, (his idea was proposed exactly as

The Budget-Mr. Manion

it is incorporated in the budget to-day. That was sixteen months ago. Let me read two or three lines to illustrate, from page 36 of that report:

The commission desires to direct the attention of the royal commission on dominion-provincial relations to the possibilities of granting some relief under the income tax for expenditures actually made in replacing obsolete industrial equipment. It suggests that a special allowance might be made under the income tax law for expenditures made in replacing obsolete plant and equipment. Such expenditures might be deducted from income before the income tax is computed, but only to the extent of the value which had not yet been written off in depreciation and only if and when the asset be actually replaced. It would of course be necessary that such a privilege should be restricted to periods of depression and unemployment.

It goes on to elaborate the idea. I mention that because I think the national employment commission should have been given some credit for it. After all, credit should be given where credit is due; and while I admit that there is nothing new under the sun, it might have been better to say that this was one idea out of twelve or fifteen proposals of the national employment commission which the government are attempting to put into effect. It is clear that the government have no ideas of their own, no originality; they merely grab whatever idea anyone puts up before them.

As I was thinking of this the other day I remembered a bird I used to hear of when I was a youngster-the cowbird. It is the one parasitic bird that we have. It does not build a nest of its own or care for its own young, but hunts up the nest of another bird and when the other bird is not there it drops its egg into the nest-

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LIB

William Daum Euler (Minister of Trade and Commerce)

Liberal

Mr. EULER:

I thought that was the

cuckoo.

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CON

Robert James Manion (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MANION:

This government is pretty much like that. It adopts the ideas of others because it has none of its own. It has no leadership, no vision; it is indeed a pretty hopeless proposition.

The national employment commission report contains, on page 37, another proposal that the government have, in a measure, taken to their hearts. It is the proposal that the dominion government should carry a larger share of the relief bills for the unemployed so that the burden on the municipalities would be less.

With regard to this income tax remission I doubt if very much in the way of capital expenditure in Canada will result from that proposal. The companies that will take advantage of it within the next year will, for the most part, be those which had already laid 71492-222J

their plans and are all ready to go on with the work. Of course the government will take full credit for any capital construction carried out, and will collect just that much less income tax.

Regarding the financial aspects of the budget, we find that revenues last year amounted to $501,000,000. The year before, they amounted to $516,000,000. Those are the two largest annual revenues in the whole history of Canada. When I say "annual revenues," of course that means annual tax collections, because this government, when it takes off anything, which it has not done recently, in the way of revenue, says it is taking off taxes; but when it adds anything to taxes, it says it is adding to the revenue. They are, however, both the same thing in fact. Every dollar of that $501,000,000 that has been collected from the people of Canada is taxes except what is taken in by the post office and a few items of that sort. But nearly 90 per cent is taxes pure and simple.

The highest revenue that the preceding government had was $361,000,000, or $140,000,000 less than the revenue last year. Yet, despite the two highest revenue years that this country has ever had, the deficit this year is admitted to be $56,000,000. Undoubtedly the estimate should be more than that, because the minister allowed for only part of the probable cost of the 80-eent price for wheat, and in all probability, if the total figures were given, the deficit, instead of $56,000,000, would be somewhere between $70,000,000 and $80,000,000.

And what of the unbalanced budget that my hon. friends over there used to talk so much about when they were on this side? I well remember the "rides" we used to be given by my hon. friends when they were sitting on this side about our not balancing the budget. I well remember how often the word "deplorable" was used against us.

Topic:   THE BUDGET
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?

An hon. MEMBER:

You stood it pretty well.

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CON

Robert James Manion (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MANION:

Yes, and my hon. friends will probably stand it in the same way.

Business is down, trade last year was down compared with the year before by about $300,000,000. Of course my hon. friends opposite now say that that is due to world conditions. During the period we were in power the worst depression that the world had ever seen, without exception, occurred in the years 1932, 1933 and 1934. The bottom seemed to drop out of business, not only in Canada but throughout the world. There were estimated to be 30,000,000 unemployed in the industrial countries of the world; world

The Budget-Mr. Manion

trade had dropped from 68 billions to 26 billions, not much more than one-third of what it had been in the peak year. Wheat was below 40 cents a bushel, the lowest price in the hundreds of years of the recorded history of the grain trade. Yet not once in all the four or five years that we were in power, did my hon. friends, the then opposition but now the government, ever admit that there was a depression, although they were reminded of it. But now they tell us it is world conditions that account for the loss of a great deal of the trade we formerly had.

In addition to the drop in trade, tariffs throughout the world also were raised against Canada during the term of office of my hon. friends opposite up to 1930. The Fordney-McCumber tariff in 1922 was imposed while my hon. friends were in office, and the Hawley-Smoot tariff in June, 1930. Those two tariffs were set up during the term of office of my hon. friends opposite, putting the protection against us in the United States market so high as to be almost prohibitive. Yet all they could tell us was, "Oh, we must not provoke the United States." Even the wheat tariffs were raised against us throughout the world. That was the beginning of the wheat troubles. The tariff in Italy was raised to 73 cents a bushel, in France to 85 cents and in Germany to 98 cents, and later they went still higher, but they were sufficiently high to prevent Canadian wheat from going into those countries. As a result we had on August 1, 1929, a wheat carry-over of

127,000,000 bushels.

There is another aspect of this budget on which I wish to touch, that is the question of statistics. The Minister of Finance adopted a new method of putting out the budget this year, and I think it is perhaps worth while. He put the tables in an appendix. Pages 24 to 36 inclusive of this appendix are tables of various kinds. I consider that those tables are presented in a most unfair and unsportsmanlike manner. Let me explain. The years chosen for all these tables, with the exception of one or two, are these, which I take from the first table: 1927, 1929, then a jump to 1933 and another jump to 1936. The only year put in the tables from the regime of the late government is the very lowest year of the depression; then they go to 1936, 1937 and 1938. In the next table they take 1932 instead of 1933; the subjects are different and I suppose 1932 was a little worse than 1933, so they take the worst. In the next table they give the years 1926, 1928, 1932, 1936, 1937 and 1938. The purpose, of course, is to show the late government at its worst and the present government

at its best. Altogether I think there are some fifteen tables and about 130 indices. The first table has sixteen indices; physical volume of business, volume of manufacturing, mining and so on; and throughout that whole list of tables, with the exception of only one or two, we find that unfair, petty political method of picking out the worst year of the world depression in order to make a contrast with the better years under the present government.

Just to show where this is carried even further, on page 27 I find the value of mineral production, covering the various minerals and starting with gold. They give the value of gold production for 1926, 1928 and 1932, and then they jump to 1936. They did not bother to pqt in a foot note or to make any mention at all of the fact that gold was revalued at the beginning of 1934. The price was raised from $20 an ounce, in round figures, to $35 an ounce, an increase of about 75 per cent; yet no mention is made of that fact. If the value of gold production in 1932, which is given in the table as $71,000,000, were increased as it should be in order to make this a fair table, the production in that year would be almost equal in value to the production in 1936. I merely mention this because in my opinion it is not a proper way to put tables of this kind in a document having to do with the budget. If the Minister of Finance wanted to give real information to the people in general he would have carried on from 1927 to 1929, 1931, 1933, 1935, 1936 and 1937; but apparently 1935, our final year in office, looked too good in comparison w'ith present conditions, and so the worst year, 1932 or 1933, was chosen. In my opinion that is just another demonstration of the Liberal method of putting out the propaganda and ballyhoo which I mentioned in my speech on the address.

Then, sir, with regard to next year the Minister of Finance estimates a deficit of about $60,000,000. If he took in the cost of the wheat bonus system and the new wheat scheme-if it should happen to remain permanent for the next three or four days- and added those amounts as well, the deficit for next year would, in all probability, be closer to $100,000,000 than to $60,000,000. I interject that remark about the wheat scheme because, as a matter of fact, nobody knows what this government is going to do from day to day. This wheat bonus scheme has already been changed three or four times. At the moment I have before me one bill as it has been reprinted by the Minister of Trade and Commerce (Mr. Euler), which came to hand just a few moments ago, showing that the

The Budget-Mr. Manion

fixed price of wheat has been raised from 60 cents to 70 cents. I have no doubt that if they can leave a loophole they will raise it to 80 cents or perhaps 90 cents in order to get the votes. It is not a case of helping the western farmer; it is a case of helping this government to hang on to power. That is quite clear. No one knows from day to day what the government is going to do. The Minister of Agriculture (Mr. Gardiner) and the Minister of Trade and Commerce have changed their schemes and they will continue to change them in any way at all as long as they think they will please the western group. This government acts like a weathercock, so far as the political winds go; it justs points in whatever direction the wind happens to blow.

Topic:   THE BUDGET
Subtopic:   DEBATE OX THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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May 3, 1939