December 4, 1940

DIVORCE

JURISDICTION OP COURTS IN PROVINCE OP MARRIED WOMAN'S DOMICLE-MOTION FOR PRECEDENCE OP GOVERNMENT ORDER


Mr. GEORGE BLACK (Yukon) moved for leave to introduce a bill to amend The Divorce Jurisdiction Act, 1930. [? * E. Lapointe.] He said: Probably I cannot do better than refer to the explanatory note printed with this bill, which is very concise: . The purpose of this amendment is to vest jurisdiction in the divorce courts of the several provinces to try actions for divorce at the suit of a married woman deserted by and living apart from her husband where the woman is domiciled in the province at the date of the commencement of such action. As the law presently stands the woman may bring suit only in the province where the husband was domiciled immediately prior to the desertion. This condition of the law works a great hardship on the deserted married woman who by reason of such desertion may have been forced to move to another province from that where the desertion took place. It is unreasonable that she should have to take her action back to the former. I could give a longer explanation and perhaps cite instances and precedents, but if the bill is allowed to be given first reading that can be done on second reading.


LIB

William Lyon Mackenzie King (Prime Minister; Secretary of State for External Affairs; President of the Privy Council)

Liberal

Mr. MACKENZIE KING:

Mr. Speaker, I have no desire to seek to supersede my hon. friend in the matter of the introduction of his bill, but I have already spoken to him about the matter. The procedure contemplated for to-day, as I think hon. members will recall, was that we would seek to proceed with the resolutions which were introduced by the Minister of Finance (Mr. Ilsley) on Monday last. It would not be possible under the rules to do this immediately without introducing a motion to proceed to government orders, and I am in a position to do so only on some measure that is debatable.

My hon. friend's motion for leave to introduce this bill is debatable. Therefore if he will permit me I am going to take advantage of this opportunity which the rules of the house afford^-I refer to standing order 48- to move that the house do now proceed to government orders. If this motion is agreed to the house will immediately reach the government order with respect to ways and means.

I might add, knowing the desire of hon. members for information on some matters, that to-morrow I will ask that leave be given the government at the beginning of the sitting to answer the questions appearing on the order paper and to deal with the notices of motion for the production of papers. I should say also to my hon. friend, to make the matter quite clear, that I do not wish to prevent him from proceeding with his bill, and that another opportunity of so doing will be given him at an early day.

Topic:   DIVORCE
Subtopic:   JURISDICTION OP COURTS IN PROVINCE OP MARRIED WOMAN'S DOMICLE-MOTION FOR PRECEDENCE OP GOVERNMENT ORDER
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NAT

George Black

National Government

Mr. BLACK (Yukon):

That will be quite acceptable as far as I am concerned.

Motion (Mr. Mackenzie King) agreed to.

War Budget-Mr. Hanson (York-Sunbury)

Topic:   DIVORCE
Subtopic:   JURISDICTION OP COURTS IN PROVINCE OP MARRIED WOMAN'S DOMICLE-MOTION FOR PRECEDENCE OP GOVERNMENT ORDER
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WAR BUDGET

CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE


The house resumed from Monday, December 2, consideration of the motion of Hon. J. L. Ilsley (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means.


NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Hon. R. B. HANSON (Leader of the Opposition) :

Mr. Speaker, I realize that it is the

desire of the Prime Minister (Mr. Mackenzie King) and members of the government to expedite this resolution and the legislation to be based upon it, but the subject matter is of such importance and of such a character that I feel we would not be doing justice to it or to the occasion if we were to deal with it only in a perfunctory way.

I quite realize that I may not be the best qualified person to discuss such an abstruse and technical subject as foreign exchange, but I recall that in the session of 1935, while I had the honour of being a member of the government of the day, a statute was enacted which forms the basis of the operations of the foreign exchange control board.

It may be worth while to recall to the minds of hon. members just what was the position. It will be remembered that in the session of 1934 the Bank of Canada Act was passed, and that in the following year provision was made, by chapter 60 of the statutes of that year, for the establishment of an exchange fund. Section 6 of that statute, which provided for the control of exchange, was to come into effect only upon a date to be fixed by proclamation of the governor in council published in the Canada Gazette. Shortly after that the election came along; the government of the day was defeated and a new government was installed, and that government did not do anything with respect to this legislation until the war came on. On September 15, 1939, shortly after war broke out, the foreign exchange control board was set up under the provisions of the War Measures Act, and on the same day a proclamation was issued bringing into effect the operations of section 6 of the Exchange Fund Act of 1935. That section reads as follows:

(1) For the purpose of endeavouring to control the external value of the Canadian monetary unit or of checking undue fluctuations in its exchange value the minister-

Under the act that is the Minister of Finance.

may directly or through such agencies as he may designate cause any balances in the special account-

That is the account referred to in section 4 of the act.

-to be invested in

(a) gold;

(b) foreign exchange as defined in section twenty-six, subsection two (b) of the Bank of Canada Act; and

(c) balances with any bank in London or New York designated by the Minister of Finance.

(2) Gold or other investments purchased under the provisions of the preceding subsection may be resold on instructions from the minister.

By subsection 3 it is provided that the statute shall come into effect upon proclamation. This section, together with the order in council which was passed on September 15, forms the basis of the present position with respect to the control of foreign exchange in Canada.

It is with some degree of pride that I call attention to the fact that under a government which was not supposed to be strongly characterized by foresight or to have much knowledge of business the foundation was laid for the functioning of this important body. It is a matter to which I think I should refer, especially since the man who conceived and promulgated the idea has been so often traduced, as he has been even during the present session, by certain hon. gentlemen in this house. I am sure the Minister of Finance would be the last to deny that had it not been for the vision of that man and his knowledge of finance and monetary problems, we should not have been so well equipped as we are to-day to deal with what to me is an abstruse and technical matter.

Under the order in council passed on September 15, which is P.C. 2716, to which I have referred, setting up the foreign exchange control board, complete authority was taken for the regulation and control of foreign exchange. The provisions are lengthy and technical, and intensive study is required to understand them. Control over foreign exchange, foreign trade and related matters is provided for in part II, which will repay perusal on the part of anyone interested. The board began to function immediately, and its operations have grown into great proportions. On the whole I am satisfied it has operated directly for the benefit of Canada and in accordance with the purposes of the promoters of the legislation authorizing it.

I am well aware that there is a school of thought in Canada which, shall I say, would be pleased if there were no such control. But anyone who has given even cursory study to the problem will realize that the old saying "what is one man's meat is another man's

648 COMMONS

War Budget-Mr. Hanson (York-Sunbury)

poison" is much to the point in relation to a matter of this kind. I know that it would be greatly advantageous to exporters in Canada if there were freedom from exchange control. I know that such freedom would redound to the benefit of some, and especially to the benefit of our paper companies and those who are manufacturing and exporting products of a similar kind. But I should like to emphasize the fact that in so far as some would benefit by what might be described as extreme profits, derived under an exchange market free from control, just to that extent would other interests in Canada suffer. On balance I believe that while a few would gain, and perhaps gain considerably, the public generally would suffer more than the extent of the advantage to those who had gained so much.

I may say therefore at the outset that I am fully in accord with the principle of exchange control and the elimination of speculation. I was going to add "profiteering," but I shall not use that word, because it would not be profiteering in the true sense; on the contrary it would be a quite legitimate transaction.

Having said this much may I return to the minister's statement of Monday last. It was of course a carefully prepared exposition of the government's policy and point of view. Let me say at once that this move on the part of the government was not unexpected by the public, and certainly should not have been unexpected on the part of hon. members who have been following with any degree of care our exchange position in relation to the United States and the mother country.

The balance of trade between Canada and the United States, over a long period of time, has been continuously adverse to us. The war has accentuated that position. When last month I had occasion to speak on the debate on the address in reply I placed on Hansard some figures showing the adverse balance of trade as between the empire and the United States and as between Canada and the United States, with respect only to commodities. These figures show that in the three-year period ending August 31 last the adverse balance of trade against the empire was

SI,624,000,000, and as against Canada alone it was $569,000,000. May I repeat that those figures are in respect only to commodities.

Without having any reference to those figures, I believe the minister said in effect, if not expressly-and in my opinion there can be no doubt as to the truth of his statement-that while these figures may have been substantially reduced by deductions made for gold sales and for invisible services such as

tourist traffic, there must have been a substantial addition to the adverse balance of trade, particularly within the last three months, and it is progressively growing greater. The fact must be recognized that no attempt has been made to restrict the exportation of dividends on capital invested in Canadian securities by residents of what he describes as hard currency countries. Furthermore-and above all, I should think- the adverse balance of trade both as between Canada and the United States and as between the empire and the United States must have increased with remarkable celerity within the last three months, and in the succeeding months in my opinion it will grow considerably.

The problem, therefore, is one which not only confronts us in the immediate present but which I believe will become increasingly intense as time goes on and so long as we are a belligerent country having to buy extensively in the United States. Having regard, then, to the increased tension in the matter, if I may so describe it, the condition is one which demanded immediate and drastic action. I suggest to the minister not only that there has been delay, but in my view, and with the best information at my command, the provisions are not adequate to maintain the equilibrium which I believe is necessary if we are to continue the present ratio or spread between our dollar and the United States dollar.

As I intimated to the minister by an interjection I made during the course of his observations, unless we are told the full story and are able to predicate our deductions, assertions and recommendations on facts placed before us, we cannot fully appreciate the situation, nor can we deal with it adequately. With a good deal of temerity I shall at a later stage in my remarks offer some recommendations-realizing, as I said a moment ago, that possibly I am not best qualified to deal with the matter. But unless we are given more information, unless we are told the sum total of our present exchange deficit and the anticipated total of that deficit from time to time as the adverse balance grows, I repeat that we cannot fully appreciate the situation or deal adequately with it. I regret that the minister, for reasons which at least to me he did not make very clear, found himself unable to take the house and country into his confidence by stating what the deficit is.

I do not suggest that the minister declined to give the information on the ground that to do so might be in the nature of giving aid to the enemy. I cannot conceive that there could be any sound or common-sense basis for any such reason 'as that. There may be

War Budget-Mr. Hanson (York-Sunbury)

reasons which I have not yet been able to divine for his not giving the house this information. I ask the minister to give us at some stage in the proceedings reasons over and above those he has already suggested, and which were in the vaguest terms, as to why we should not have this information. It is my opinion that upon knowledge of the quantum of the deficit in our obligations in respect of the exchange position between Canada and the United States will depend the judgment we may seek to pass upon the measures the minister is promoting for at least the alleviation of the position.

I suppose if I were clever enough I could read between the lines and gather from the information the minister did give the house a reasonably close estimate of the present deficit. I am not suggesting that I am a statistician, but it should be possible for anyone versed in the exchange position to make such an estimate. I have endeavoured to do something of the kind, and I suggest to the minister with regard to his estimate of $200,000,000, that the actual figure is higher than that. If I understand his proposals correctly, he hopes to improve the position- shall I put it that way?-to the extent of between five and six million dollars per month. If that be the measure of his proposals, I say that they are wholly inadequate and that we shall have to deal with the matter at a later stage and perhaps in a more drastic and realistic manner.

It must not be supposed by anyone that this is the first move that has been made. During the course of his remarks the minister set out the steps which had been taken since the war broke out at least to touch the position-I shall not say to keep in step with it. In his comprehensive review on Monday he indicated that up to June last the general policy involved no restriction of import or export trade, with the single exception that the board refused to provide exchange for the export of capital from Canada except within certain narrowly prescribed limits and with certain exceptions for capital that had been invested in Canada after control was established. In April an important step had been taken in exchange control when the foreign exchange acquisition order was passed under which all our available liquid supplies of foreign exchange, United States currency being the most obvious, as distinct from such foreign assets as securities, were placed directly under the control of the board, and all our nationals had to turn in their United States money. A further step was taken as a result of the budget in June when the war exchange tax of ten per cent was imposed upon all imports except those from sterling

14873 -42

countries. In addition, special progressive excise taxes were imposed on automobiles. In July the board took further measures to prohibit the sale of foreign exchange to Canadians for pleasure travel abroad.

While some of these measures are not of substantial importance, I suppose they are all relatively important. But they have not been sufficient to keep the position in equilibrium, and as a result we had the budget of Monday last. In reflecting upon this budget certain questions have arisen in my mind. The first is: Are the new provisions adequate? I think I have answered that already. In my opinion they are not. They may be just the first dose to the Canadian people. That may be sound policy; I do not know what the reaction is throughout the country, but I am inclined to think that it is good. With the principle involved I am in accord. I am in accord also with the principle involved in the second schedule of the budget, which deals with the loosening up-I use that expression for want of a better one-of sterling exchange in this country.

Having read the resolutions, I ask myself: Are the safeguards against price rises adequate? Further, while I do not wish to deal at the moment with individual positions I am wondering what will happen with respect to magazines and periodicals. Would it not be better for parliament to lay down the rules with respect to this matter rather than to leave it to the Minister of National Revenue (Mr. Gibson)? It seems to me that this is a delegation to a minister of authority which ought to be retained by parliament.

Prior to 1935 the government of the day sought to deal with the question of the importation of cheap United States periodicals- not in relation to exchange, but in relation to their effect upon national literature and national sentiment. I remember that hon. gentlemen opposite, especially the Prime Minister, opposed the principle of the imposition of taxation upon the advertising in these magazines. The Prime Minister took the broad view that there should be no tariff on brains. That is a high-sounding phrase, but what was the effect of his action in wiping out the protection to Canadian periodical producers when he came into power? It has been this: In five years the importation of these

periodicals-I was going to use another term -has increased in value from about $2,250,000 to $6,500,000. If hon. members will go with me to any large news-stand in this city and look at the periodicals on sale I think they will agree with me that, exchange considerations or no exchange considerations, the government should exercise some authority to

650 COMMONS

War Budget-Mr. Hanson (York-Sunbury)

keep these things out of the country and away from the Canadian people. There is no tariff on brains, but there should be a tariff on trash.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
LIB

William Lyon Mackenzie King (Prime Minister; Secretary of State for External Affairs; President of the Privy Council)

Liberal

Mr. MACKENZIE KING:

I have never

supported the allowing in of any of these rotten sheets.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

I dare say my right hon. friend did not think it would have the effect it did. I know the question was considered minutely with those in the trade and it was felt at the time that the only way to deal effectively with the matter was to tax the advertising. When the Prime Minister opposed those measures I do not believe he had it in mind that the traffic would grow to the proportions it has.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
LIB

William Lyon Mackenzie King (Prime Minister; Secretary of State for External Affairs; President of the Privy Council)

Liberal

Mr. MACKENZIE KING:

I have always been in favour of prohibiting altogether certain classes of magazines or periodicals, particularly the type referred to by my hon. friend,

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

If my

right hon. friend has been in favour of that, he certainly has been slow to act. In bookstalls in any of the large cities in Canada I can show him magazines of the veriest trash which should never have been allowed into the country. Some are even worse than trash. Occasionally salacious magazines have been prohibited by action of the Department of National Defence-

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

The Department of National Revenue.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

It ought

to be the Department of National Defence. I think it would be a good defensive measure to give the jurisdiction to that department. However, I appreciate the fact that it can be handled better by the customs than by any other branch.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

I think I am safe in saying that hundreds have been prohibited.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

There are hundreds more that ought to be prohibited. I shall not go further into the matter, but I suggest to the minister that parliament might very well be asked to deal with the question of policy rather than leave it to the discretion of the Minister of National Revenue. I do not question his good faith or his understanding of the situation, but this is an exercise of power on a matter of principle with which parliament itself should deal.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

Parliament does deal with it.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

I am not so sure about that. My reading is that a very

wide discretion is left in the hands of the Minister of National Revenue. That means, in his officers. They may or may not move. I do not for a moment suggest that the minister should have the duty and obligation of making examinations himself because he must rely on his officials. Many a time they have been asked to move, and many a time they have failed to move, but sometimes they have moved.

I shall not deal with that further except to suggest to the minister that we might very well in this house settle the principle upon which this action is to be based. I hope that, war or no war, the time will never come when Canada will allow these salacious magazines to appear again on the bookstalls of this country. I am thinking of generations yet to come.

There is another thought. When I heard the minister's explanation of his budget proposals I wondered what steps had been taken and what avenues had been explored by the ministry to increase the flow of our exports into the neighbouring republic. From our point of view that would be, I suggest, the ideal method of correcting the exchange position between the two countries. I referred to that when I spoke in the house on the 12th of November. It is astounding to me that a little nation of twelve million people should buy at least twentydive times more per capita from the United States than they buy per capita from us.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
Permalink
LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

We are selling twenty-five times as much to them as they are to us per capita.

Topic:   WAR BUDGET
Subtopic:   CONTINUATION OF DEBATE ON PROPOSALS OF MINISTER OF FINANCE FOR CONSERVATION OF FOREIGN EXCHANGE
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December 4, 1940