May 9, 1938 (18th Parliament, 3rd Session)

LIB

John David MacRae

Liberal

Mr. J. D. MacRAE (Glengarry):

The people of the constituency I represent are largely employed in farming, and the question of farm implement prices is of keen interest to me. The west reckons its purchasing power in bushels of wheat, western Ontario its purchasing power in pounds of beef, but the farmers of Glengarry county are largely engaged in dairying, therefore their purchasing power depends on the price they receive for a hundred pounds of milk.
During the years 1930-35 milk manufactured into butter and cheese was making a return to the farmer of sixty to sixty-five cents per hundred pounds. At that price it was impossible for them to replace their worn-out machinery. It was amazing, in travelling through the country, to see the number of machines that were held together with hay wire. In 1913 a farmer could purchase a binder for $137, and he received at that time about one dollar per hundred pounds for milk delivered at the factory door. This made the purchase price, in terms of pounds of milk, 13,700. In 1938 a six-foot binder suitable for use in Ontario can be purchased for $263. Milk is now yielding about a dollar per hundred pounds. So that it will take 26,300 pounds of milk to purchase that binder. The purchase of other farm implements is on a similar scale. As was pointed out to the committee, the price of the binder at factory was $123 and the retail price $263, leaving a spread of distribution costs of $140, which seemed to me to be excessive. If the farm implement companies would agree to eliminate much of the high pressure salesmanship and try to reduce distributing costs, it would greatly benefit the country.
I am fully convinced that if we had a fair exchange of commodities in our production it would do much to solve the difficulties in the economic situation which we are now experiencing. If this condition could be brought about we would not need to consider the social credit theories of Alberta. The hon. member for Haldimand (Mr. Senn) suggested that as this committee brought in its report two years ago its findings do not apply to present conditions. The hon. member for Greenwood (Mr. Massey) intimated that he had severed his connections with the
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implement business six years ago, and therefore he can no longer speak with authority on the production side of the question. Much as I admire his fluency of speech I cannot admire his train of thought.
Right Hon.R.B. BENNETT (Leader of the Opposition): I am greatly tempted to make
a speech in reply to the many observations that have been made in this house on this report, but I shall refrain from doing so, and shall endeavour in a very few sentences to bring to the attention of my fellow members and my fellow citizens some of the reasons why I feel that we should not engage in the form of sectional warfare in which we have been engaged in the last few days.
I confess that there is no matter in which, since I went west forty years ago, I have had a more sustained interest than the price of farm implements. The real story of farm implements is almost romantic. If we carry our minds back to the days of the prophets of old, the ox as he trod out the corn was not to be muzzled; if we remember the tale of the gleaner as recorded in the book of Ruth, and the crude instruments of which we now have the evidence in our museums, we can understand the extent to which the farmer of this country is dependent upon the manufacturer.
It does seem to me very strange that in this house we should be constantly apologizing for the manufacturer. Sometimes I find it difficult to understand that state of mind. Who is the manufacturer in Canada? I hold in my hand the book supplied by the Department of Trade and Commerce to every member of this chamber, and when I turn to pages 46 and 47 I find the value of agricultural production, and turning to page 94 I find' the value of our manufacturing production. I find that in 1936 the total value, in all provinces, of agricultural capital, including live stock, implements, machinery, lands and buildings, was placed at $4,628,-
375,000, in round figures. Turning to manufacturing production I find it estimated thus in 1935: Capital, $4,698,991,000, with nearly
25,500 establishments employing 582,000 persons, with half a billion paid out in salaries and wages, and almost a billion and a half paid out in the cost of materials, with a gross value of products amounting to nearly three billions.
Why, then, should we be so apologetic when we speak of the manufacturing industry of Canada? Why should my fellow Canadians be so apologetic on the one hand and critical on the other of the industrial life of the
country? For my own part I am proud of it, as I think most Canadians are. We go about the dominion speaking of what we. have been doing and of what we have accomplished. I realize, of course, that the manufacturing business in Canada became very great during the war for reasons that need not now be discussed, and I realize that our plants attained a measure of efficiency and effectiveness that they had not before known. The real question that we have to face in connection with agricultural implements is not limited to implements alone. The flail- and I daresay there are members of this house who have never seen a flail-the sickle and the cradle have given place to the binder and the combine; and the application of high mechanical skill has developed the mowing machine, the rake, the tractor, the caterpillar tractor, the power-drawn harrow and ploughs and implements that are used for the purposes of cultivation not only in this country but in every other country in the world, whether it be in the cotton fields in the south of this continent or in our wheat fields, or our com fields, or our potato fields. Whether it be in any of these fields there is usually some special implement or instrument th^t is utilized for a specific purpose.
I make these observations by way of introduction; for, as I have said, the temptation to engage in a partisan discussion of the situation is very great. I do not propose to take part in such a discussion; for I do not believe that the men to whom reference has been made are endeavouring to exploit the Canadian farmer. I have under my hand one of the last reports of an implement company, the Massey-Harris Company; I find that one of the directors is a member of this house, Mr. W. H. Moore; and I find that others who are members of that board of directors are men who, I am sure, have a high sense of their obligation to every part of our population. Does any hon. member believe that these men are endeavouring to exploit the farmers of the country for selfish purposes? I think not. If I were engaged in a partisan discussion I could point out how strange it is to have the suggestion made that prices could be fixed by this government or by this parliament, which, as the privy council has decided, has no jurisdiction over pricefixing except in times of emergency; or that we should exercise control over the capitalization of companies, when all the companies to which reference might be made are companies which attained their powers in those halcyon days between 1920 and 1930?

Farm Implements Committee Report
I want to ask my fellow members one question: Is it desirable that Canada should have an agricultural implement industry? That is the first question which I suggest should be answered. In Russia when they first outlined their five-year plan they concentrated their efforts upon being able to produce implements of production. I have lived long enough in this country to see it suffer because we had not refined material with which to meet our own requirements, notwithstanding that we were sending out in ingot form the raw material that we required in refined form. I could give instances now, if it were desirable, in which Canadians had reason to apply for the use and purpose of a certain type of refined material which we, owing to our great production of electrical energy, sent from this country in ingot form; but owing to the prior claims of other purchasers in another land we were not able to secure a supply for our wants.
Sometimes it has been said that instruments of production should be placed upon the free list, and that Canada is not interested in the development of an industry for the production of instruments or implements of production. Nothing could be more injurious to this country than that we should be without an agricultural implement industry. When the great war came upon us a great implement factory in Great Britain was taken over by the state and used for the production of munitions of war, and the export business of that organization vanished. We in this country I think would, almost by common consent, answer in the affirmative the question, shall we have an agricultural implement business in Canada? True we have had such an industry here since 1847. We have had an industry here which developed from very small beginnings. Those who are familiar with the romantic story of the development of the industry in the United States, of the efforts of McCormick, need not be ashamed of the efforts made by our pioneers, who were not machinists in the large sense of the term, or trained engineers, but who established the industry in this country. Necessity was the motivating power behind them, and they worked out in a small way just what, for instance, MacKay did in Australia. There they have still preserved the little area in which MacKay began the production of agricultural implements for that great commonwealth, the industry having now grown to a very great business. They have their implement business; they realized that it was essential that they should have it. Disturbances in transport, something always
to be considered; the necessity for the preservation of neutrality, always important; the utilization of an implement factory for wa purposes, always a possibility: these factors alone, apart from every other consideration, necessitate that the Canadian people should have in this country an agricultural implement industry.
Then if my fellow members answer that question with me in the affirmative, they realize that at the present time we have four large industries engaged in the production of agricultural implements. Our ploughs have a reputation in the Argentine second to none in the world. Our machinery produced in Germany and France is second to none. And even in the United States of America one of our factories has a very efficient production service. Our implements or instruments of production are well and favourably known. Under these circumstances, having had an industry for many years, and agreeing, as I trust my fellow members do, that we should have such an industry, there must be a condition attached to it, or conditions. What are the conditions? The conditions are two:
(1) that the quality of the implements thus produced should be as good as it is possible to produce anywhere in the world; (2) that the price should bear a just relation to the cost of production. Are there any other conditions that one would suggest with respect to a matter of kind, once you have concluded that you should have the industry?
The next question, then, that we would have to answer, dealing with this matter purely as a business transaction, is, how can we accomplish this end? By what means can we ensure to Canadians a domestic implement business in all its branches, ensuring not only the industry but the quality and the reasonable cost of the product? Well, various means have been suggested from time to time in the world's history as to how that might be accomplished. But every nation in the world has had recourse to one device to accomplish that end. Great Britain was the last to adopt it, because by reason of her established trade and her banking and finance facilities in London, Great Britain had been able to bring to her shores vast quantities of raw material which could be fabricated at very low prices. Those of my fellow members who have read the life of John Morley will remember with what resentment he contemplated the possibility of there being any interference with the contractual rights of those who employed labour at any price they saw fit, of any age and for any hours of toil. That state of things is past.

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The device or method, then, that we and every other nation of the world have adopted to accomplish that end is the tariff. The Minister of Labour (Mr. Rogers) said the other day that you could not contemplate this country now without tariffs. Tariffs in Canada owe their continuance to two facts which cannot lightly be overlooked. One is our geographical position. Whether you or I like it or not we are, as the Prime Minister (Mr. Mackenzie King) remarked the other day, part of the North American continent. On the North American continent we have
125,000,000 people who have by mass production carried industry to a point of effectiveness and efficiency unknown in the world before. There has been nothing like it in labour-saving devices, in the methods utilized by the genius of inventors to carry forward their undertakings. And the other fact is that with a small population we are endeavouring to develop a vast area in which we have provided facilities for transport, by sea and land, to an extent that really menaces the economic safety of our country. In other words, we were over-ambitious; we contemplated a vast population which has not materialized, and eleven millions of people are carrying a burden which can be borne only if we maintain some form of industrial activity.
As part of the second reason I have given- and it might be regarded as a third-you have the consideration which I trust will always be in the mind of every hon. member, namely the shifting of our population. So long as you had in Canada a population the major part of which was rural, you had a situation which was not very difficult to deal with. But to-day we have a population the major part of which is to be found in cities and towns. That has created for all governments-and I trust hon. members will agree with me as I proceed, because I am trying to keep away from controversy-a problem of great magnitude. Think of it: over one-half of the population of this dominion has gone to the cities and towns. That became apparent for the first time when the census was taken in 1931. It has been greatly accentuated since that time. Our population in cities and towns has grown and grown. People are going from the country to the towns and cities, in the west chiefly because of crop failures and in eastern communities for other reasons which need not here be discussed; and the result is that to-day, in this early period in our history as a dominion -only now, be it noted, something like
[Mr. Bennett.!
seventy-one years, which is but nothing in the life of a country-the major part of our population is in cities and towns.
Any student of history knows what the result of that is. A man does not need to be a trained economist to recognize the seriousness of the result of that condition. What has it done? It has placed upon the cities and towns the necessity of providing some form of industrial life, unless that population is to be maintained on relief by the state. That is the real fact of it.
Now, the necessity for some form of tariff being admitted-

Topic:   FARM IMPLEMENTS COMMITTEE
Subtopic:   MOTION FOB CONCURRENCE IN SECOND REPORT PRESENTED APRIL 8, 1937
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