February 17, 1937 (18th Parliament, 2nd Session)


John Ritchie MacNicol

Conservative (1867-1942)

Mr. J. R. MacNICOL (Davenport):

Mr. Speaker, in rising to support in a general way what I believe to be the objective of the motion moved by the hon. member for Broadview (Mr. Church), I propose to confine my remarks chiefly to the effect which the present very high cost of government in Canada has on business, and through business, on employment in industry and in business. The hon. member in his motion refers to overgovernment and overtaxation, both of which we have in Canada, and both of which in my humble opinion, which I shall attempt to back up with facts, have had and do now have a very serious effect on employment.
I am pleased particularly with that part of the hon. gentleman's motion in which he suggests the appointment of a select committee of this house or of a joint committee of both houses of parliament to consider the subject matter of this resolution. I am glad that he suggested a committee, and not a commission, because this country has at present sixty commissions, if not more, the majority of which are overstaffed and overpaid, and the great majority of which are costly millstones on business in this country, and through business on employment. I am convinced, as the hon. member has said, that the members of this house and of the senate should do a lot of the work which is now being done by these sixty or more commissions that have been inflicted on the country.
A word or two on the cost of government in Canada. We have ten parliaments; we have a council in the Yukon; we have one senate, and I believe we have one legislative council. There are approximately 884 legislators of one kind or another, 764 of whom are elected and 120 appointed. If one looks into the administrative structure of the very large institutions in the United States, infinitely larger than anything we have in Canada, handling far more money than does the government of this country, and having many, many thousands of employees, I do not know of a single instance-and I have looked into the structure of many of them-where they have such an enormous and costly staff as this country has, including members of this parliament and the legislatures, to run our business. I am convinced that the cost of government in Canada could be very materially cut down.
I read a few days ago-and I confirmed it to-day-a statement issued by our own bureau of statistics, that the debt of Canada and of its provinces and municipalities, direct and indirect, but not -including the indirect debt of the municipalities, now totals almost seven
billions of dollars. This is an enormous debt for eleven millions of people to carry. It is a staggering millstone on production in this country, and is one of the major reasons why industry has slowed up. It is one of the major reasons why so many industries which I knew but which are not now in operation, have been compelled to close their doors.
I think the hon. member for Broadview was correct when he said that the provincial governments are doing or attempting to do much work which this parliament should do, and which is only interfered with by the legislatures. Just how that can be remedied I do not know, but perhaps a joint committee of this house and the senate, in association perhaps with a committee from the provincial legislatures, could bring about reforms along that line.
The bureau of statistics -tells me that the provincial debts of the nine provinces are very close to $1,700,000,000, and that they are ninety-nine per cent higher than they were ten years ago. This is something for business men to stop -and consider because we cannot go on in the way we are going. It imposes too overwhelming a coat on industry, and through industry on employment. That is what I am mostly concerned -about. All my working days I have been studying the question of employment, and I know that every cost of this kind which is -added to industry reduces employment. When we come to the third branch of government in this country, the municipalities, I find that the 4,200 municipalities in Canada also have a debt amounting to about a billion and a half. To try to carry on under the triple burden of federal, provincial and municipal .taxes, industry and business are faced with a very difficult task. Business in Canada has had inflicted upon it taxes which it is now almost impossible to bear, and I will mention a few of these taxes. I say they have been " inflicted " upon business, and I think that is the right word. Perhaps some of them are absolutely necessary, perhaps most of them are; but at any rate they have been inflicted to a large extent upon employment itself. For instance, we have the sales tax, the excise tax, the income tax, the stamp tax, the tax on cheques, the business profits tax, a small one in connection with the radio, the corporation tax, the municipal business tax, the tax on capital, taxes on gross revenue, taxes on branches of industry. If a company has its head office in Montreal and branch offices in cities throughout Canada additional taxes are inflicted upon these branches, notwithstanding that they give employment. Then we have other t-axes-the poll tax, the property tax,
Constitutional Reform-Mr. MacNicol
the gasoline tax, the picture show tax, soft drink and hard drink taxes and a hundred and one varieties of other taxes and licences.
A considerable number of these taxes are either duplicated or, as sometimes happens, levied from three directions. Take for instance the income tax. In Ontario we had a municipal income tax and a federal income tax, and now the province itself has taken the right to inflict an income tax on the people of Ontario. The gasoline tax is imposed in Canada in at least two ways and in the United States sometimes in three ways. If there are three gasoline taxes in the United States it will not be very long, if that tax is not now collected in Canada by three different taxing bodies, before every gasoline user will be compelled to pay taxes three times on his gasoline. When I was in the state of Mississippi last summer I had to pay a state tax of six cents on gasoline, a municipal tax of two cents and a federal tax of one cent. I do not know how many other states have it three ways, but every state in the American union has it two ways, federal and state.
All these taxes, whether we like them or not, do add to the cost of production, as every industrialist knows if he has trucks, and cars for his selling agents. Every one knows that these taxes add to the cost of production.
I was struck by an editorial that appeared in the Kingston Whig-Standard1 some time ago. This is an old, reliable newspaper, a supporter, I believe of the government of the day, and some fine editorials appear in it. It is a famous newspaper going back very many years, and the editorial in question, with which I very largely agree, refers to the present government of Ontario, though what it says is applicable to many other provincial governments. For my part I do not want to apply it to the present federal government. However, this is what it says:
We do not mean to reflect upon the capabilities of the members of the government, but not one of them has to-day any actual business connection, so far as we are aware, nor has any one of them had the difficult task of piloting a business through the depression and endeavouring to keep men at work. The government is composed of two doctors, four lawyers, one engineer and three farmers. Naturally, when any matter comes up affecting manufacturing, or wholesale or retail business, or even the capitalists of the province who finance business, there is no one to put forth their side of the question.
As I say, I do not wish to refer to the present government, nor in what I am saying have I any reference to the previous government ; but apart from those two I am convinced that it may be said quite truthfully of all governments in Canada that they have

had far too few business men in administration. I am not suggesting that a high class lawyer like my hon. friend from Middlesex West (Mr. Elliott), who is looking at me, knows nothing about business, but I would ask him to say whether he has been engaged practically in giving employment to five hundred or a thousand men in his time. What I say is that the man who provides employment, who is associated with the strenuous business life of the country, who is buying and selling and processing material and having it distributed throughout the country, always anxious to see that it gives satisfaction, is the type of man we too seldom find in the government of the country.

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