April 25, 1950

CCF

Hazen Robert Argue

Co-operative Commonwealth Federation (C.C.F.)

Mr. Argue:

The minister can make his

speech afterwards. In the meantime I think I can-

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

James Garfield Gardiner (Minister of Agriculture)

Liberal

Mr. Gardiner:

Fix up yours as you go along and I won't need to make one.

Topic:   THE BUDGET
Subtopic:   ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CCF

Hazen Robert Argue

Co-operative Commonwealth Federation (C.C.F.)

Mr. Argue:

I can make a speech more

nearly in accordance with the facts than can the Minister of Agriculture.

Topic:   THE BUDGET
Subtopic:   ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

Co-operative Commonwealth Federation (C.C.F.)

Mr. Knowles:

The minister should stick to grasshoppers.

Topic:   THE BUDGET
Subtopic:   ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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CCF

Hazen Robert Argue

Co-operative Commonwealth Federation (C.C.F.)

Mr. Argue:

If the government continue

with this policy, all they will be doing will be to invite the importing countries to bid less for Canadian wheat at a time when the Minister of Trade and Commerce has already said that as far as wheat is concerned we are going into a buyer's market.

I say that the government should have continued the initial price of $1.75 a bushel for the next three years. Even if it cost the federal treasury some money, it would only be a very small payment indeed for the sacrifices and the contributions that the farmers have made over the last three years when no other segment of the Canadian economy was called upon to make a similar sacrifice.

The government has not tied the price of Canadian wheat to the highest price for wheat on the international market. Therefore I feel that the government now should not tie the initial price for wheat to a figure which is even lower than the floor price in the international wheat agreement.

Farmers are indeed disappointed in the government's wheat policy. The Saskatchewan farmers' union passed a resolution at their recent convention held a few weeks ago, asking that they be paid $2 a bushel; under the five-year pool, that is another 25 cents a bushel. Numerous wheat pool committees are asking that the new $1.40 initial payment be

The Budget-Mr. Matthews increased. I would ask the government, before it brings in the bill and before it ties its hands by doing so, to increase the initial price to $1.75 a bushel and to maintain it throughout the life of the international wheat agreement.

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

James Ewen Matthews

Liberal

Mr. J. E. Matthews (Brandon):

Mr. Speaker, I want again this year to congratulate the Minister of Finance (Mr. Abbott) upon the splendid budget that he submitted a few nights ago. It is just another indication of the advances that have been made in Canada's progress, and I have no doubt that even his keenest critics-some of them at least-would admit in their own minds that he has done a wonderfully good job. I know the Canadian people will appreciate his frankness; I know they will appreciate his honesty of expression, as was evidenced when he discussed several points. There was no quibbling in anything that he said.

The minister has ample ground for rejoicing, having again maintained his record of surpluses, an unbroken record which is all the more noteworthy because of the fact that in all the years since confederation there have been only seventeen when a surplus was declared. All the others were years of deficits.

It is noteworthy also because his surplus of $111 million last year was in the face of a substantial reduction in the taxes levied upon the taxpayer. Such a record of course would have been impossible had it not been for the high level of last year's production; for it has been well said that production and trade are the two pillars of national prosperity. This being so I am sure the Minister of Finance would like me to share the credit for his excellent year with two other deserving ministers who very largely directed the building of those pillars, namely, the minister of production, agricultural production, if you will, and the Minister of Trade and Com-merie (Mr. Howe). Both these departments contributed in a high degree to the year's success.

Take agricultural production, for instance. I do not share the gloom of some of our members. In spite of the great industrial development of Canada since the beginning of the century agriculture is still the country's basic industry. It employs directly one-quarter of the gainfully employed, and indirectly provides for the employment of many others in processing, packing and marketing agricultural products. In 1947 about one-half of the gross value of the production of primary industries came from the farm.

It is most pleasant to pause, and realize that during recent years farm income has reached a level so high as to be undreamed of a few years ago. It was very close to $2,500

[Mr. Argue.)

million again last year, divided among the different provinces, excluding Newfoundland, as follows-I am quoting millions only:

Millions

Province of dollars

Prince Edward Island 21

Nova Scotia 37

New Brunswick 44

Quebec 346

Ontario 653

Manitoba 283

Saskatchewan 570

Alberta 463

British Columbia 98

I must not let the occasion pass without throwing in this side remark, that Manitoba leads all other provinces in the average income per farm. What I have said on farm production applies also to production along other lines. Forests amounted to $975 million; minerals, $890 million; and fisheries approximately $170 million. There are various others that might be mentioned. When it is recalled that last year our production was $16 billion, exceeding 1948 by $500 million, it will be evident that every channel of production, including manufacturing, must have co-operated in the building of one of the pillars of our national prosperity. But let us look back. Let us not forget that back of production is employment, and right here I want to quote some pertinent remarks in this regard made by a leading economist. His first sentence really tells the whole story. It is as follows:

The way to make more employment is to make more employers.

Nobody can gainsay that. Then he goes on to say:

Employers are made by preserving incentives to produce and to expand productive enterprise. In the free system the principal incentive, and the most effective one, is the hope of profit. Moreover, it is through profits, together with individual savings and investment, that the economic organization is provided with the tools and equipment which make employment possible.

The first great barrier to the expansion of employment in proportion to the increase in the labour force is to be found in the tax system, which rewards effort on a diminishing scale, graduated down almost to the vanishing point; which discourages risk and venture; and which because of the sheer burden of taxes reduces the savings and impedes the investment which the economic organization must have if it is to grow.

Mr. Speaker, in view of those words of wisdom, as I see them, expressed by that economist, it is encouraging to note the substantial reduction in taxation already made by the Minister of Finance (Mr. Abbott). I trust more will follow.

So much, then, for production, the first pillar supporting the splendid edifice presided over by the Minister of Finance. That pillar has its setting in the toil of the producers, not only in agriculture but in every

other walk of life. Many of those producers, however, follow the sane suggestions made from time to time by the minister of production-or agriculture, whichever term one prefers.

But that first pillar, production, would be only a weak support without the second, known as trade. We hear a good deal about trade these days, and rightly so. The more our attention is focused upon Canada's trade, the better for Canada, and the more we shall then realize the outstanding ability of Canada's Minister of Trade and Commerce (Mr. Howe), in the pillar he has done so much to erect. Many of our people fail to realize that Canada's trade per capita is double that of the United Kingdom, and four times that of the United States; that Canada's wage earners, including the three fighting services, made 196 per cent more money in 1949 than in 1939; that last year Canada's retailers did the greatest business in their history-6 per cent higher than in 1948; that as a result of the building of pipe lines, which originated in 1949, Canada is due to save hundreds of millions of dollars in United States funds in future years. It is stated that in 1948 Canada spent $300 million in the United States for oil alone.

We are told that Canadian imports from the United Kingdom, which had a value in 1946 of $140 million, increased in 1947 to $190 million and in 1948 to $300 million. Even the 1949 figure, while representing an important increase over the past few years, will be only about 13 per cent of our total imports. Yet someone has pointed out that this amount of imports taken by 13 million people in Canada from the United Kingdom is more than the total imports that the 150 million people in the United States take from the same source.

Expressed another way, on a per capita basis, in 1949 we are buying goods from the United Kingdom at the rate of $24 for every man, woman and child in Canada. The comparable figure for the United States is about $1.40.

I am sure, Mr. Speaker, it was cheering to the people of Canada, and must have been doubly cheering to the Minister of Finance, when a few days ago the Minister of Trade and Commerce tabled departmental documents forecasting a new high of $3,600 million in public and private capital investment in Canada for 1950, a 5 per cent increase over 1949.

Speaking of trade, as complementary to farm production, and indeed all production, I was greatly interested when a few days ago there came to my notice some cogent facts expressed in a novel way by a good friend

The Budget-Mr. Matthews of mine. These facts concern Canada's food contribution to the world. To my mind the article is so original, and yet so informative, that I should like to quote somewhat freely from it now. It depicts in a unique manner the ramifications of our trade. At the same time I should like to keep in mind the prodigious work of the departments of trade and commerce and agriculture in bringing about the results to which this writer has referred.

Every day in this chamber, when the house is in session, the writer suggests, we hear this prayer: "Give us this day our daily bread." The article goes on to say:

This is our only prayer made without reservations. When we think of bread we Canadians think of wheat. Excluding the Union of Soviet Socialist Republics, the largest producer of wheat is the United States, producing 24-4 per cent, then China, with its twenty-two provinces, 17-8 per cent and Canada, 7-4 per cent of the world's supply.

Let us compare this with world population figures. He continues:

The United States population is 6-8 per cent, China 21-5 per cent and Canada 0-6 per cent of the world's population.

Thus China with 21-5 per cent of the world's population produces 17-8 per cent of the world's wheat while Canada with only six-tenths of one per cent of the population produces 7-4 per cent of the wheat. Canada must therefore export to other countries a large share of its wheat production and now rates second in the amount supplied to the world markets.

Canada, however, supplies to the world by trade many other articles of food, and in reading of their destination, if one can use imagination, they would make the pamphlet of a travel agent's world tour look like a very uninteresting document. Just imagine the cook book of the Arabs and1 the Germans having Canadian foods in their recipes. For the year 1949 agricultural and vegetable products were exported to the value of $773 million and animals and animal products to the value of over $338 million, a total of over one billion dollars, and mainly food for others.

The United Kingdom took $413 million worth and the United States $370 million. Wheat as grain went to forty-four countries and flour of wheat to seventy-four countries. While wheat may change its name to corn, it is the principal source of the world's daily bread. It is grown near the Arctic circle, it is grown on the equator and produced in practically every country in some larger or smaller degree.

The largest customer for wheat is the United Kingdom, but on reading the list of the countries which are customers for Canadian wheat, we can picture a great variety of people, all with their own customs of living, preparing it for food. Arabia, Chile, Egypt and Norway all take wheat, while flour goes to Africa, Hong Kong, Cuba, Denmark, even to Madagascar and Greece.

Let us look further into Canada's exports of food other than bread. We And jams and jellies go to fifteen countries from Japan to the Belgian Congo, to the amount of $155,000.

Apples fresh, apples dried, apples canned, go to twenty countries all the way from England to Hong Kong. They get various names when sold to the housewife, but they are Canadian apples just the same. This export is worth to Canada $7 million.

18E6

The Budget-Mr. Matthews

We also supply to this world-wide table such things as blueberries, strawberries, pears and peaches, while canned fruit goes to over thirty countries, all from Canada.

Tomato juice to the value of $49,000 goes to thirty countries, the names of which would conjure up interesting native customs-Ethiopia, Guatemala- even $10 worth to Meth in the Antarctic. Onions to the amount of $152,000 go to countries from Greenland to the Virgin islands. Apple juices and canned corn, not to mention pickles, sauces and catsup, all go to forty countries, including Pakistan and Morocco.

To the world's great table go potatoes to the amount of $2,900,000, nearly two million dollars' worth of turnips to twenty-two countries and I must not forget the porridge, oatmeal and rolled oats to a million and a half dollars going to forty countries from Peru to India.

From what I have said you will see our vegetables and grains are known the world over, but what about the joint of meat? Here we have another wonderful story.

Purebred cattle are shipped by air to Chile, and we export to twenty different countries to the amount of over six million dollars; dairy cattle over eight million and cattle for beef forty-six million. We export chickens and turkeys and an abundance of fish and fish products. Bacon goes to twenty countries to a value of twenty-four million dollars. The products of this country, Canada, are on the breakfast, dinner or supper tables of every country. We must export to buy our tea, coffee and many other things to eat ourselves, for in North America the standard of living is the highest in the world. We export to eighty countries and Canada's exports are not on a two-way street. Trade is by many roads. Markets for our products are world-wide. We must trade on a world basis, buying and selling in all the world's markets and improving our trade with all the world.

I have been discussing the two pillars, production and trade, that form the basis of our national economy. May I turn for a minute to the superstructure that we are erecting upon those two pillars. Do they bear a proper relationship, because there is a limit to the weight that any pillar can carry? Are we attempting to build too much upon those pillars as we have them today? Any superstructure that is too top-heavy is liable to collapse if and when the winds of adversity strike. This is a possibility that Canadians of every class should be frank enough to realize.

I spoke of the finance minister's honesty of expression. All Canadians will be impressed with his statement that our annual rate of expenditure is not likely to fall below the present mark of $2,400 million. That is a lot of money for this country. That is a lot of money as compared with 1939, for instance, when our expenditures were less than one-quarter of that amount, or $553,063,098.

It appears however that our present annual expenditure can be handled providing we maintain our present national production of $16,000 million per year, which by the way was two or three per cent greater last year than in 1948, and providing also that our present heavy standard of taxation is maintained.

But the rainy day comes to a nation just as to an individual and so far as taxes are concerned Canadians are carrying a heavy load. I think the superstructure is already as heavy as the pillars will carry. Someone has computed that we pay in taxes 28 per cent of our total annual income. I think we pay more. Seventy-eight per cent of those tax payments are to the federal government, ten per cent to the provincial government and twelve per cent to the municipalities. In all three cases too much of it I suggest is collected in the form of hidden taxes and thus the people are unaware of what they are actually paying, even though the percentage now is smaller than that of previous governments.

Quite frankly one phase of our public financing that gives me concern is the large and rapidly increasing portion of our payments that have come to be listed as "uncontrollable expenditures". That is a very dangerous term and one which any government and any people will do well to heed. Let a sufficient tonnage of uncontrollable expenditure be loaded upon our superstructure and there can.be only one result: the pillars will be unequal to the strain. In this respect the amber is already showing and the red light controlled by the taxpayer is at hand. There is no gainsaying the fact that some expenditures are always in order and entirely justified. Sometimes they might be classified, not as expenditures at all, but as investments, as bread cast upon the waters which in due course will come back buttered. I can think of no better example of what I mean than expenditures made by the agricultural department under the P.F.R.A. regulations. Those expenditures have proved to be good investments for all concerned.

But when a large part of a nation's expenditures come to be listed as "uncontrollable" the danger signal must be heeded. I refer to this, because of the pressure from so many quarters for further huge expenditures, which once begun it will be practically impossible to discontinue, no matter how hard the Canadian taxpayer might be pressed. Among uncontrollable expenditures with which the taxpayer is already burdened, we have $449 million per year interest, mainly on war debts, and $500 million per year on what are included under the general and rather indefinite phrase, social services-these in addition to the tremendous amounts absolutely necessary for national defence.

I am not surprised that people are beginning to wonder where the money would come from for those further huge expenditures that are being demanded. That question is easily answered. It would come from your pocket and mine and the pockets of our neighbours,

either directly or indirectly. There is no other source. If the Canadian taxpayer wishes to avoid further heavy demands upon the fruits of his toil he needs to do some serious thinking and to do it right now. Following that, he should also let his opinions be known as regards the weight of the superstructure as compared with the strength of the pillars.

I congratulate the Minister of Finance (Mr. Abbott) upon his firmness in resisting demands upon the public treasury greater than this country can stand. I congratulate him upon his frankness in that regard, a frankness that commands the respect of all. That firmness has been a contributing factor to our debt reductions of almost two and a quarter billion dollars since the war, including $486 million in 1949.

The cheering feature of it all is that on a basis of three per cent interest charge those reductions mean a saving in our interest payments of between fifty and sixty million dollars a year for all future years. Is that good financing or is it not? Do those reductions in our interest payments mean anything to you who have to raise the money or do they not? Do you desire still further reductions or do you not? I know what your answer has been in the past. I know what it would be today.

I have stressed those debt reductions because to me they give the whole story of the budget in a nutshell. Further analysis would seem unnecessary. Any finance minister who every year since the war has kept the business of this country advancing under a full head of steam and at the same time has reduced Canada's indebtedness to the tune of nearly $2,000 million is good enough for me. I congratulate him of course, but I congratulate much more heartily the people of Canada upon having a minister so able and so frank at the financial helm of this country.

Topic:   THE BUDGET
Subtopic:   ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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PC

Harry Oliver White

Progressive Conservative

Mr. H. O. White (Middlesex East):

Mr. Speaker, once again this discussion of Canada's budget is under way and I, like other hon. members, wish to try to interpret to the government some of the thoughts, desires and wishes of the people I have the honour to represent. I think one of the most disturbing features of the budget was the rigidity with which the Minister of Finance (Mr. Abbott) said that our expenditures would be fixed at $2,400 million, that they will never be less. Let us hope that we are in a position to afford that, but people and nations have found that they have had to adjust their household and national budgets to fit their incomes and pocketbooks. When any government gets in a position where it has promised more than the people can produce and more than the tax collector can extort

The Budget-Mr. H. O. White from the producer, then the nation is in a serious situation. I am fearful of the giveaway policy of the government. What does $2,400 million mean to the average citizen, the man in the street? He passes it off. He figures it is a lot of money. What does it mean to the individual? Let me tell you that it is approximately $200 for every man, woman and child in Canada. Therefore, for every family of five it is about $1,000, and that does not take into consideration at all provincial or municipal taxation. Is it any wonder that the householder finds it difficult to buy groceries and clothing, and to pay rent? The federal government is extracting from the head of every average family of five approximately $1,000. That is a serious situation, and the minister has said there is no retreat from that position.

The hon. member for Kamloops (Mr. Fulton) ably pointed out last night there were some things that could be done in the minister's department as well as in some of the other departments to reduce this enormous expenditure somewhat. The reason that the man in the street does not know just how much taxes he is paying is that many taxes are hidden. There is quite a little bit of it hidden in our daily bread. There is more of it hidden in our clothing, still more in the house that we try to buy, and hundreds of dollars in the automobile that one may own or wish to own. These things are articles that every one of us wishes to own or owns and uses. Possibly hidden taxes do not hurt as much as income taxes but nevertheless they are just as effective. Speaking roughly, about half of the income of the government comes from that source. In our school days we read about early times in Great Britain when Robin Hood and his band of robbers took from the rich and gave to the poor, but they were just pikers compared with the way the Robin Hood sitting across from me does it, and he is not greatly disturbed about it either.

Dealing with income tax for a moment, I want to refer to the collection of tax on undistributed reserves. Most industries have set aside reserves for a rainy day, shall we say, or for the day when times are maybe not as good as they are now or become a little difficult. The distribution of such a reserve simply means that the labourer working in that industry is going to be out of work that much quicker. More companies are going to go broke more rapidly if times get tough. Let us hope they do not, but let us not be so foolish as to make no provision. Years ago the story of the seven lean and the seven fat years was unheeded and disaster followed. I think the history of nations and people has pretty well borne

1868

The Budget-Mr. H. O. White that out, if you look back over the past centuries. I should like the minister to consider seriously that part of the income tax legislation dealing with the enforced distribution of reserves. In one of the subsections there is a provision for a ninety-day period during which it has to be cleaned up; otherwise it is considered as not distributed and subject to the collection of tax thereon. I said that no buffer was left to protect the labourer in his job, and that is a most vicious system. Apparently the government has embarked on a program of outdoing and out-promising everything that the socialists promise. They have worked themselves up to a figure of $2,400 million, and they say there is no retreat and that it may be worse.

I mentioned the give-away program of the government. If I were conducting one of these radio give-away programs I would be able to say, step right up, this is the greatest give-away in Canada's history, it is now going on. Let men say that it was not necessary. In the period following the war the government had at its disposal, until quite recently, powers under the War Measures Act and the Continuation of Transitional Measures Act so that some of the things which have occurred were not necessary. They gave away or lost our agricultural export markets which are now in the hands of enemy countries behind the iron curtain. They have given away our raw resources to the United States. Last week we saw the culmination of that in the defeat of the opposition to the pipe line measures. Wall Street interests are now going to have the satisfaction of seeing that the United States is served first, and what is left Canada will get. We know just how much we shall get out of a deal like that.

I should like to mention some of the other things that have been given away. Every year we give thousands and thousands of our best educated young men to foreign lands. It is estimated that it costs $30,000 to educate a child from kindergarten until he has completed his university training. When that is finished he is then offered a job in the United States. The government is giving away $20,000 for every soldier eduoated at the Royal Military College because, as I mentioned before on the defence estimates, the same training can be provided at the universities of Canada for approximately $1,000 per man. The curriculum is the same and the hours of study are the same even to the minutes. I checked it and I know.

The hon. member for Kingston City (Mr. Henderson) protested and tried to point out to the house that it was the first soldier educated there who cost $20,000 and not the

others. Such is not the case. That is what it is costing this year for every one of them. Our defence dollar, when spent on the Royal Military College, is just worth a nickel. You can figure that out for yourselves. Like many other members of the house I receive unsigned letters. I had one dealing with the remarks I made about the Royal Military College. The writer said that I should consult my leader and other military leaders of both parties. The people whom I consult, Mr. Speaker, are the people who elect me, and I respect their judgment greatly. Probably the greatest weapon of defence the minister has is the secret weapon of telling no one anything. That will not win a cold or a hot war. Secrecy is being used as a cloak for reckless spending. Secrecy is being used to cover up and hide inefficiency. I attempted to get the information I required concerning the Royal Military College but was refused it, and had to place a question on the order paper in order to obtain the figures I needed.

I want to mention again that we are indulging in the greatest give-away in history; but before they can give anything away they have to take it from those who produce it. Let no one forget that. Taxation is penalizing hard work, thrift and ability, the very traits that made this nation great. When the previous speaker, the hon. member for Brandon (Mr. Matthews), was telling us that the population of Canada was such a small fraction of the population of the world, I thought that was a pretty good example of what 150 or 200 years of free enterprise could mean to a country. No other small country-in numbers-anywhere in the world ever produced the abundance we have; but how long can we continue to take away from those who produce and give to the idle, the thriftless and ne'er-do-wells? We must come to the end of the trail some day. Then what about unemployment? During the latter part of last session and early this session we were told it was seasonal and temporary, as I mentioned once before.

Apparently we have two sets of rules by which the game is played in this country. The manufacturer is protected by tariffs, but they tell the primary producer he must compete in the markets of the world. But he cannot go to the markets of the world for the things he has to buy; he must purchase them in a protected market. I want to give a few concrete examples of how this government is causing unemployment, and suggest some things that could be done to correct the situation. I know the ministers may say: Oh, it is only ten or fifteen or twenty

men here, or a hundred men there; but when you add them up right across the country the number is very considerable. In the Srst place I suggest that we could develop aur coal resources, and when we became independent of United States fuel our exchange situation would be greatly improved. Then for nine long years we have been rearing about the development of the St. bawrence seaway, but still nothing has been lone. We should retain for our own people >ur sources of cheap fuel, including Alberta >il; and the recent sell-out I mentioned is rut one of the examples I could give.

Then we import foreign vegetable and mimal- oils with which to make butter sub-ititutes, when we could produce those very ;ame oils in this country. The farmers dare lot change from the production of the grains hey now grow because the minute they did io the importer from the United States-and mportation is done by practically one com->any only-could drastically slash the price o the Canadian farmer. So what confidence can he have if he goes ahead and nakes a change? The farmers lack confidence because the very promises that were nade last June are being broken every day. Inly yesterday the dairy farmers of Canada ;ot a slap in the face. Our tariffs as applied o primary products are such that they cause nany things to be produced abroad that could >e produced right here in Canada. I realize is well as any other hon. member that many hings coming from the warmer countries ould not be produced in Canada. It is bad inough to have to import them, but it seems o me a very foolish policy when we import very month thousands of dollars' worth of oods we could produce ourselves. The net esult is that we are hiring people abroad o do things we could do.

One commodity that comes to my mind s sugar. We produce a very small percentage f the sugar we consume, though our sugar >eet industry could be expanded enormously, f that were done it would reduce some f the surpluses of other products we now ave difficulty in marketing abroad. It seems o me the policy that has been followed with espect to Canadian agriculture is very short-ighted as it applies to the things we could iroduce in our own country. But if we o make any changes along these lines let s be sure that we give our farmers some ssurance that they will not have a market or only one year, that next year they will ot find the situation entirely changed. Our armers must have a longer term program dan that to work on or they will not make dese changes. All that Canadians need is ssurance, based upon the knowledge that ne government is sincere in any statement

The Budget-Mr. H. O. White it makes. The farmers are not likely to regard the government as sincere, however, if they continue to be dealt with as they were treated yesterday.

Then I believe we should reimpose the provisions of P.C. 181, the order in council dealing with dumping duties. The excuse for not doing this is that under the Geneva agreements it cannot be done. Only one country in the world has ratified those agreements as yet; that is Switzerland. It is just drawing a red herring across the trail to say we cannot impose those dumping duties. It is a very lame excuse. Now we are told that another delegation is going to Torquay, England, where some 2,500 items will be reviewed and some forty countries will participate in a reduction of tariffs program. Geneva is three or four years behind us; Annecy is behind us. It seems to me these conferences are just becoming pleasure cruises for the senior civil servants in the upper brackets. As yet we have not seen any results worth talking about. And what about our bacon trade? That was lost through the bungling and bickering of two governments. I think if governments would stay out of business we would all be better off. I need not dwell on the deal that has brought consternation to the dairy industry, the employing of foreign labour to produce articles that could be produced in Canada.

I am going to mention a number of items. Someone may say they are small. That is true; so is a nickel, but the companies in the nickel business do very well. Let us watch our nickels, and the dollars will take care of themselves. One item I would mention is asparagus. That is a small matter, perhaps; asparagus is grown only in restricted areas. But when Canadians are ready to harvest their crop they are told the dumping duties cannot be applied; so a flood of United States asparagus comes in, prices drop, and the hopes of the producers are dashed to the ground. Always there is a lag of from ten days to two weeks between the time the department is notified that Canadian asparagus will be ready for the market and the time dumping duties or restrictions are imposed upon the importation. Why? Simply because the wholesalers and dealers in the large centres of this country tell the government what to do. They know they have the primary producers scattered here, there and everywhere. They can look after them, and who can squeal about it? But the big fellows in the cities will take care of themselves; don't worry about that.

What about cheese? It seems that the cheese market has been lost. I wish to point out that we have an opportunity of getting into the

1870 HOUSE OF

The Budget-Mr. H. O. White United States market, but the regulations are such that it is only the lower grades of cheese that can enter the United States. Is that any way to advertise our good Canadian Cheddar cheese? I have friends who visit me from the United States, and when they come here we go to the local factory at Glanworth to buy a good cheese for them to take home. Practically all the high-scoring cheese is kept in this country, and it is only cheese that scores 92 or less that is permitted entry to the United States. t

I mentioned the dumping duties in connection with asparagus and other fruits and vegetables, and I said that I thought the dumping duties should be applied right across the board. Last spring thousands upon thousands of crates of Canadian celery were sent to the dump, representing a total loss to Canadian producers. Restrictions on the importation of celery from the United States for one month would have meant that all that Canadian celery would have been used. The importers paid $5 or $6 per crate in United States funds for celery which replaced Canadian celery. The government does not need to try to hide behind the Geneva trade treaty, because that was not the reason. The real reason was that the wholesalers of this country could make a bigger profit on celery from the United States than on Canadian celery. All that was needed in that instance was a little horse sense in the administration of these dumping duties.

On March 24, 1950, the Canadian onion growers had 100 carloads of onions on hand. On March 31 they were told that nothing could be done to prevent onions from the United States entering this country. At that time, they were selling at 44 cents per 100 pounds in Chicago. The duty on onions entering Canada amounts to about 8 cents per 100 pounds, while the duty on Canadian onions going to the United States is $1.75 per 100 pounds. What kind of a deal is that? I would say that is a raw onion. It is about time the primary industries of this country had a little protection, as well as the manufacturing industry. What is sauce for the goose is sauce for the gander. I wish to say that it is about time the Liberal members, who represent constituencies in which these primary industries are located, said a word or two in their defence.

I should like to recall to the minds of hon. members the vastness of the quantities cf products that are imported from the United States which could be produced in Canada. I have in my hand a copy of "Foreign Trade", issued March 18, 1950. The main groups are as follows: Agricultural, vegetable products, in the month of January 1950 alone, $27 milium;

animals and animal products, for the monte of January, 1950, $6 million; fruits, $4,468,000; vegetables, $1,904,000; grains and grain products $987,000; sugar and products, $1,954,000. Those amounts relate to the month of January alone. In the month of January too, oils, vegetable, amounted to $2,111,000; vegetable products, other, $1,959,000; fish and fishery products-and this is one of the greatest fishing countries in the world-$297,000; animal oils, fats, greases, $356,000; animals and products, other, $1,354,000. In this land of vast areas, we find imported wool, raw and unmanufactured, amounting to $3,040,000 for the month of January; wool products, $4,563,000. There is no need for unemployment in such a land as ours,- if labour is directed into the proper channels.

There are two or three other points I should like to mention. I have in mind a letter from Prague, Czechoslovakia. Much has been said about the use of the mails, and the refusal of that use to certain individuals. I do not hold any brief for those individuals

ir. the city of Toronto or anywhere else, who are possibly trying to fleece the public. As has been pointed out, there is a way to deal with that type of individual. I have here communist propaganda from Prague, and when the fact that it was sent through the mails was brought to the attention of the postal authorities, they said that there was nothing that could be done. I should like to read to you some of the interesting comments in this "Prague News Letter," volume 6, No. 8, dated April 14, 1950. The headline

is, "The mask of Peace and Charity stripped off the Warmongers." It reads as follows:

In Czechoslovakia-prime target among the people's democracies for the warmongers' offensive oi lies and provocation-the past fortnight has beer especially disillusioning for the American deceivers and self-deceivers, and rich in lessons for the Czechoslovak and all other peoples. The trial oi the abbots and other monk-spies ripped away ths pious concealment from the face of the Vatican* CIC-

That means, counter intelligence corps.

-plot against peace and democracy.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Greenwood):

Was tha

published in English in Prague?

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PC

Harry Oliver White

Progressive Conservative

Mr. White (Middlesex East):

Yes, and sen out here.

Here is another article which says, "Tom my-guns under the Lord's Temple." It read: as follows:

Sentence was passed on ten representatives o various Roman Catholic religious and monastii orders on April 5 by the state court in Prague After long and careful investigations the stat authorities and the court unearthed the facts am purpose of their activities and passed a just verdic on the criminals in the name of the Czechosloval people.

Then it goes on to name the different men, and the various monasteries and orders to which they belonged. Farther down the article says:

What is the most significant fact however is that the lord bishops, provincials, and professors of theology did not commit their crimes solely as individuals. All were members of a far-flung net of spies and saboteurs organized by the Vatican and reaching into the monasteries not only throughout Czechoslovakia, but also in Austria, Italy and other countries.

This publication is the property of a friend of mine in the city of London, but I shall let those who are interested see it.

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PC

Clayton Wesley Hodgson

Progressive Conservative

Mr. Hodgson:

Is this the sort of propaganda that is going through the Canadian mails?

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PC

Harry Oliver White

Progressive Conservative

Mr. White (Middlesex East):

Yes, and the Post Office Department has said nothing can be done about it.

When I was dealing with fruits and vegetables, I neglected to mention that the fruit and vegetable growers have made certain suggestions for aiding the industry. I should like to read this paragraph from those suggestions:

Because of the Inadequate protection that we have our association has adopted a new policy which it intends to present to government and to members of parliament. The policy is, in effect:

1. A clear demand for complete free trade.

2. Failing No. 1 an agreement by which fruits and vegetables of a like and kind not produced in Canada will be admitted duty free all year round, whilst fruits and vegetables of a kind produced in Canada will be admitted duty free when domestic supplies are not available and placed on restriction when domestic supplies are available.

To me that seems to be a reasonable request. I continue:

3. Failing adoption of either No. 1 or No. 2 we want complete protection through tariffs high enough to prohibit importation when domestic supplies are available.

All three of these requests are very reasonable.

I should like to mention that the sales tax was removed from dairy drinks. Included in dairy drinks was popsicles. By no stretch of the imagination can a popsicle be a dairy drink. It is a frozen soft drink and nothing else. The tax was not removed from similar products in the bottled state.

I want to say a word or two to the Minister of Finance (Mr. Abbott) regarding these much heralded grants to municipalities in lieu of taxes. In municipalities where there are government properties and buildings it was hailed as a great step forward. It was nothing but a joke and a hoax. The sum of $5 million which was to be used for that purpose in all Canada is just peanuts. In my riding there is the greatest military hospital in the British empire. It is not the biggest, but it is the

The Budget-Mr. H. O. White greatest. It falls upon that municipality to educate the children of some of the doctors and others who are employed there. Under the present set-up not a cent of taxes are we likely to receive.

I hold in my hand a resolution from the city of London over the signature of Mr. Cooper, the clerk. I am going to read it because I heartily concur in its contents. The resolution reads:

That in view of the dominion-provincial conference now in progress, and the fact that amendments to the British North America Act are being considered, this council urge upon the dominion and provincial governments that in any amendment to the said act provision be made for the payment by both levels of government of normal taxation on properties held by either government within the limits of any municipality in organized territory;

This is something that we shall have to face sooner or later. While we are dealing with public buildings may I say that a new income tax building was erected in London, Ontario. While it gives you a pain every time you enter it, I want to say something about it to the Minister of Public Works (Mr. Fournier). This is the way issues are evaded and money is spent without actually showing on the accounts. I am going to say right now that this building is not in keeping with the architectural structures around it, nor with the beauty of the other public buildings in the city of London, nor with the private buildings that are erected there. I might mention the London Life building and a good many others. This particular building is on Dundas, one of the main streets. I hate to use the word, but it is actually a disgrace.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Greenwood):

Probably the minister was his own architect.

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PC

Harry Oliver White

Progressive Conservative

Mr. White (Middlesex East):

No. I can tell you how it came about. I hold in my hand sessional paper No. 83, and it tells the whole story. The building was erected according to specifications. I know the company that built it. They built the Western university. They have built some of the finest buildings in the land. You get only what you pay for. This building was built for the Westmount Realties Company. I will tell you who the directors of the company are. They are: Mr. E. B. Mills, Mount Royal, Quebec, president; Mr. H. Mills, Montreal, vice-president; Mr. Wheatley, Montreal, vice-president; Mr. Rankin, Westmount, vice-president; Mr. McAthey, Westmount, secretary-treasurer; and Mr. C. J. Smith of Westmount, director.

The building is leased to the income tax department for 10 years at $70,000 a year, and at the end of 10 years they are to pay $550,000 additional and the income tax department will own the building.

The Budget-Mr, H. O. White

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LIB

Alphonse Fournier (Minister of Public Works; Leader of the Government in the House of Commons; Liberal Party House Leader)

Liberal

Mr. Fournier (Hull):

The hon. member is all wrong.

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PC

Harry Oliver White

Progressive Conservative

Mr. While (Middlesex East):

Don't try to tell me that; it is all contained in this sessional paper.

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LIB

Alphonse Fournier (Minister of Public Works; Leader of the Government in the House of Commons; Liberal Party House Leader)

Liberal

Mr. Fournier (Hull):

We could buy that building tomorrow for $550,000, not at the end of 10 years.

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PC

Harry Oliver White

Progressive Conservative

Mr. While (Middlesex East):

Are you doing it?

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LIB

Alphonse Fournier (Minister of Public Works; Leader of the Government in the House of Commons; Liberal Party House Leader)

Liberal

Mr. Fournier (Hull):

We will see about that and give you an answer in due course.

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PC

Harry Oliver White

Progressive Conservative

Mr. While (Middlesex East):

That is not the way the business of the country should be run. You built a lovely public building in the city of London. It is used by the post office. A similar building should have been built for the income tax department. If they were not going to do that they should have put it on a back street. Simpson's built a warehouse, which far surpasses this one, on a back street in the city of London. This building is going to retard the growth of the city. It is a disgrace.

Yesterday I asked the Minister of Trade and Commerce a question about the convertibility of exchange. This is his reply, as reported at page 1811 of Hansard:

Mr. Speaker, an organization known by the initials OEEC-organization lor European economic co-operation-has been advancing a plan which is designed to bring about the interchangeability of currencies on the continent of Europe, including the United Kingdom. This plan is still under study and is being actively advocated. I think there is some hope that convertibility to the extent I have indicated will be brought about in the near future.

He said the near future several weeks ago.

I wonder if that near future is just prior to the next general election. During the few years that I have been engaged in politics I have learned a lot, and there are some things that I can see at quite a distance. It is possible that this is one of the things that are likely to come about at that time.

I hold in my hand a clipping from the Toronto Star of April 15, 1950. Much as I dislike to quote the Star, the gist of what it says is this. Dealing with the benefits that Canada is likely to receive from tariffs in the United States it goes on to say:

Toys are one example. Germany was chief United States supplier before the war although Canada's industry has now developed into sizeable proportions. Concessions granted to Germany, and therefore to Canada, would enable Canada to boost toy exports to the United States. At present Canadian toy exports to the United States are restricted by tariff barriers.

The inference is that we are going to gain by this deal. The truth of the matter is, we are going to lose all our markets to Germany

and to the United States. That is what is going to happen, and the Star tries to cover it up by a news item of this kind.

Yesterday we had the pleasure of having His Worship the Mayor of London, the president of the western fair, and city architect, down here trying to arrange some details of financial aid for the building of an arena there devoted to the interests of agriculture. According to the newspaper items, London is not likely to get aid. It just occurred to me that possibly last June that was one of the promises that the Liberal party neglected to make when they were fighting the election, and since it was not promised we are not likely to get it.

The Canadian people are worried about the budget and the attitude of the government in budgeting for an expenditure of $2,400 million. Therefore I think the minister should revise his thinking before twelve months pass and we hope that the next budget will be better than this one.

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SC

Frederick Davis Shaw

Social Credit

Mr. F. D. Shaw (Red Deer):

Mr. Speaker, my participation in the debate at this time results from certain assertions made yesterday on the floor of the house by the hon. member for Athabaska (Mr. Dechene). Obviously, one could not be expected to permit certain of his almost fanatical assertions to pass unchallenged. Moreover it is my personal conviction that certain of his implications and insinuations require some consideration and analysis.

My purpose is not to be unnecessarily critical, because it is understood that when the hon. member for Athabaska succeeds in working himself into a political frenzy he invariably indulges in indiscretions, inaccuracies and exaggerations, possibly without being entirely conscious that he is doing so- at least I should like to believe that he was not completely conscious of what he was doing.

On October 25 last year the hon. member for Athabaska stood in his place in the House of Commons and urged, with a good deal of vigour and also with much justification, favourable consideration by the government of the completion of a certain line of railway in northern Alberta. I was somewhat surprised last night to hear him advancing the same plea; because I recall that it was less than a year ago-June, 1949, to be exact- that he and his colleagues were telling the people of my province, and elsewhere, that all they had to do was to elect Liberal candidates and get everything they wanted, everything-all things to all men.

Last fall the hon. member used these words-and again I say he used them with plenty of justification-

I am only asking parliament, the government and the executive of the Canadian National Railways to fulfil their solemn pledge and to carry out their word of honour to the people I represent in this house.

On November 3 I rose in my place and advanced the wholehearted support of my colleagues in his plea. But of course I could not resist the temptation to remind him that he had forgotten something. It will be recalled that upon that occasion he lashed out with some considerable viciousness at the Conservative government which held office in Canada between 1930 and 1935. Then he said something like this-indeed these are his exact words: Then the war broke out. I reminded him that four or five years elapsed between the defeat of the Conservative government and the beginning of the war.

Yet nothing was done. 1 think it was that assertion on my part that made him go hog-wild yesterday. Apparently he does not like being informed of his own party's weaknesses, or the weaknesses of the government he supports.

Yesterday the hon. member for Athabaska, as reported at page 1818 of Hansard, said:

The other day the hon, member for Red Deer (Mr. Shaw), referring to what I said last fall, asked why the Liberal government had not done anything from 1935 until 1940. The hon. member is a school teacher and he should1 be possessed of some information. He knows that in 1935, 1936, 1937 and 1938 the government of Alberta defaulted on their obligations to the extent of over $20 million.

And then he added this:

A blot was placed on the escutcheon of Alberta which it has taken decades to erase.

I am sure the residents of that area in northern Alberta, which has been adversely affected as a consequence of the failure to carry out declared policy with respect to that railroad, will appreciate knowing that Alberta is to blame for the railroad's not having been constructed.

But it is not that so much to which one would object, as it is to the insinuation constantly thrown out by the hon. member that, whereas the Social Credit government assumed office in Alberta in 1935, we were responsible for the conditions which prevailed at that time. I hope he has read the report of the Bank of Canada for 1937, which is a report of an investigation into the financial position of Manitoba, Saskatchewan and Alberta. It was at the invitation of the Social Credit government of Alberta that this investigation was conducted within that province. I do not like taking the time of the house to recount what was

The Budget-Mr. Shaw said about my province during those years when it was under a Liberal administration. However the hon. member for Athabaska makes it necessary for me to do just that. I quote from page 4 of this 1937 report:

Policies pursued from the time the province was created, 1905, until the year 1922,-

That is, under a Liberal administration- -had a profound effect on the financial position of the government of Alberta. The roots of many of Alberta's present problems-

That is, 1937.

-were developed during this period. Only the exceptionally rapid economic progress of the time can account for the fact that extravagant governmental expenditures, direct and indirect, were allowed to proceed on such a scale and to last so long as they did.

Almost immediately after the formation of the province, ambitious telephone and railway policies were launched. Poor judgment, loose administration and over-expansion were to make both utility ventures costly.

And here is another choice one at page 8:

By the end of 1922, Alberta had a direct and guaranteed debt (on which it was already paying interest or for which it was later to become liable) which was some 50 per cent larger than in the much older province of Manitoba, and more than twice as large as that of Saskatchewan, though Saskatchewan had a 30 per cent larger population.

That was under a Liberal administration. And here is another choice one at page 18 of the same report:

Alberta entered the depression with the largest outstanding debt of any province except Ontario, and had the highest fixed charges in relation to its revenues in Canada. The causes of this, as we have outlined, were the extravagant expenditures of the 1905-22 period, followed by the failure to reduce debt during the subsequent prosperous years.

Might I interject at this point that, since the hon. member for Athabaska was speaking about railroads, he ought to get that report and: read what it has to say about the disastrous railway policy of the Liberal government of Alberta at that time.

I have said many times that we had our one and only taste of Liberalism in Alberta during that period. The report summarizes on page 10 in these words:

To summarize, we find the policies pursued in the ambitious and extravagant 1905-22 period resulted in the accumulation of a heavy dead weight debt, and that no adequate effort was made to put the government and various government enterprises on a self-supporting basis, in spite of the favourable opportunity presented by the general prosperity. Alberta consequently entered the following period under a handicap which was certain to create problems for the future, unless a determined effort was made to reduce debt.

The Liberals gave us a debt of $95 million, and the U.F.A. government boosted that up to $167 million in 1937. It took the Social Credit government to whack almost $5C

The Budget-Mr. Shaw million off the provincial debt. In 1935 my province was having to spend 51 per cent of its entire revenue in order to meet debt charges.

I should like to refer to an excellent example of what I consider to be distortion and misrepresentation. The hon. member is reported on page 1819 of Hansard of yesterday as follows:

In my own town of Bonnyville many of the merchants and citizens had a few dollars invested in provincial certificates.

Remember, the hon. member is speaking of that early period 1935-36.

We tried to collect these funds to build a school and-

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April 25, 1950