October 25, 1979

PRESENCE IN GALLERY OF SPEAKER OF SASKATCHEWAN LEGISLATIVE ASSEMBLY

LIB

James Alexander Jerome (Speaker of the House of Commons)

Liberal

Mr. Speaker:

Before beginning the question period, may 1 ask hon. members to join with me in signalling the presence in our gallery of a distinguished visitor and my distinguished counterpart from the province of Saskatchewan, Mr. Speaker J. E. Brockelbank.

Topic:   ROUTINE PROCEEDINGS
Subtopic:   PRESENCE IN GALLERY OF SPEAKER OF SASKATCHEWAN LEGISLATIVE ASSEMBLY
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Some hon. Members:

Hear, hear!

Oral Questions

Topic:   ROUTINE PROCEEDINGS
Subtopic:   PRESENCE IN GALLERY OF SPEAKER OF SASKATCHEWAN LEGISLATIVE ASSEMBLY
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ORAL QUESTION PERIOD

THE CANADIAN ECONOMY

LIB

Herbert Eser (Herb) Gray

Liberal

Hon. Herb Gray (Windsor West):

Mr. Speaker, I have a question for the Minister of Finance. How could the minister have agreed to the advice of the governor of the Bank of Canada to raise interest rates yesterday to 14 per cent, when the governor today told the finance committee he was unable to give to him or the committee his forecast of the effect of this interest rate increase on such matters as jobs, economic growth, mortgage rates, housing starts and small business?

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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An hon. Member:

Resign.

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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PC

John Carnell Crosbie (Minister of Finance)

Progressive Conservative

Hon. John C. Crosbie (Minister of Finance):

Mr. Speaker, I thank the hon. gentleman for giving me the opportunity to say that 1 support absolutely the statement that Governor Bouey made to the committee this morning.

While I have not got the transcript of the committee proceedings here yet, I certainly can tell him this, that the move that the governor recommended-and which I accepted and which 1 accept responsibility for-is one taken after very serious consideration. Because I believe, and the governor believes, that it is in the long-term interest of this country and the Canadian economy, the Canadian people and the small business community whom we represent on this side of the House and whom we are concerned about, that this policy be adopted and that the battle against inflation and the battle to retrieve our economy from where the hon. gentleman's party left it, this is the only way we can proceed today.

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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LIB

Herbert Eser (Herb) Gray

Liberal

Mr. Gray:

Mr. Speaker, I have another question for the Minister of Finance. I want to start by saying that the Prime Minister, speaking as leader of the Progressive Conservative Party to the Canadian Construction Association last March 2, said:

Record high interest rates work against confidence because they work against growth-

He went on to say:

Interest rates must come down if we are to get the Canadian economy growing at its full potential. It would be the policy of the Progressive Conservative government to gradually bring these interest rates down.

In light of these commitments I would ask the minister how he and the Conservative government can do just the opposite and agree to these record high interest rates.

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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PC

John Carnell Crosbie (Minister of Finance)

Progressive Conservative

Mr. Crosbie:

Mr. Speaker, the hon. gentleman is right on: that is our policy and that is what we are going to do. We are going to bring these interest rates down when we have got inflation in Canada under control and when the other western industrialized countries have it under control. We are going to bring the interest rates down when the huge trade deficit of over $7 billion left by the hon. gentleman's government is

October 25, 1979

Oral Questions

brought under control and when the budgetary deficit of $11 billion is brought under control.

Our policies are aimed, Mr. Speaker, at bringing interest rates down as soon as economic conditions permit. That is what we are dedicated to. What prevents us now is the record left by the hon. gentlemen opposite.

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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Some hon. Members:

Hear, hear!

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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LIB

Herbert Eser (Herb) Gray

Liberal

Mr. Gray:

A final supplementary question, Mr. Speaker. The hon. minister's policies are just the opposite. He is following the policies of the Mad Hatter in Alice going through the looking-glass.

I want to ask the minister if he will bring in a budget immediately which will state the government's fiscal policies to deal with the country's needs in the face of these high interest rates and the very high increases in energy prices his government is promoting and agreeing to, or is he going to continue on a course of vagueness and evasiveness indefinitely, a course which he has been following and the government has been following for the past five months?

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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PC

John Carnell Crosbie (Minister of Finance)

Progressive Conservative

Mr. Crosbie:

Mr. Speaker, if it is the Mad Hatter and looking in the looking-glass, the hon. gentleman only has to look in the glass himself to see the Mad Hatter, because he was associated with the minister of finance who also had to agree to interest rate increases because of the shape that his government brought the economy to.

As far as the budget is concerned, I am very anxious to bring down the budget. One matter that is preventing me is this, that there are a number of pieces of legislation left over from the Liberal budget of November, 1978. We cannot bring in our own budget until they are cleared up, because we cannot have our own ways and means motions before the House until that legislation is cleared up. So if the hon. gentleman would co-operate to put through the remnants of their own budget, left shamefully from November to March without any action, then we would bring down our budget. I am very anxious to bring that down and get Canada on a new course and to protect us from the effects of the last budget.

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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?

Some hon. Members:

Hear, hear!

Topic:   ORAL QUESTION PERIOD
Subtopic:   THE CANADIAN ECONOMY
Sub-subtopic:   INCREASE IN INTEREST RATE-HARMFUL EFFECT ON THE ECONOMY
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INCREASE IN INTEREST RATE-EFFECT ON MORTGAGE RATE

LIB

Lloyd Axworthy

Liberal

Mr. Lloyd Axworthy (Winnipeg-Fort Garry):

Mr. Speaker, my question is also for the Minister of Finance. On October 18, 1978, as reported at page 238 of Hansard, when in opposition the minister said:

These people are being crucified with an II Vi per cent mortgage rate-

Would the minister make the judgment now that, as a result of his policies and his government's policies we have the mortgage rate going up to 14>/2 per cent, the people of Canada are not being crucified but are being drawn and quartered by an unmerciful government that no longer has a care for those ordinary people? Does he realize the housing industry is in severe recession; building starts are down 30 per cent?

Topic:   ORAL QUESTION PERIOD
Subtopic:   INCREASE IN INTEREST RATE-EFFECT ON MORTGAGE RATE
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Some hon. Members:

Oh, oh!

Topic:   ORAL QUESTION PERIOD
Subtopic:   INCREASE IN INTEREST RATE-EFFECT ON MORTGAGE RATE
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An hon. Member:

Order.

Topic:   ORAL QUESTION PERIOD
Subtopic:   INCREASE IN INTEREST RATE-EFFECT ON MORTGAGE RATE
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PC

John Carnell Crosbie (Minister of Finance)

Progressive Conservative

Hon. John C. Crosbie (Minister of Finance):

Mr. Speaker, I will give the hon. gentleman this opinion that, yes, people are being crucified now with high interest rates because of the record of that last ten years.

Topic:   ORAL QUESTION PERIOD
Subtopic:   INCREASE IN INTEREST RATE-EFFECT ON MORTGAGE RATE
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?

Some hon. Members:

Oh, oh!

Topic:   ORAL QUESTION PERIOD
Subtopic:   INCREASE IN INTEREST RATE-EFFECT ON MORTGAGE RATE
Permalink

October 25, 1979