May 3, 1939 (18th Parliament, 4th Session)

CON

Charles Hazlitt Cahan

Conservative (1867-1942)

Hon. C. H. CAHAN (St. Lawrence-St. George):

I do not intend to follow the
hon. member for Saskatoon (Mr. Young) into his discussion of textile production. I have read the report of the learned justice, Mr. Justice Turgeon, to which he has referred, and my recollection is that those who have been criticizing the textile industry throughout the country have paid very little attention to that report. Only recently I heard a remark made by an hon. member who sits at my left about a $500,000 investment bringing great returns; to-day the hon. member (Mr. Young) states that the investment is a million dollars. I have not the figures at my hand; I am simply trusting to memory, but if these gentlemen will look into the facts they will find that the companies which were brought together represented an investment of ten or twelve million dollars, and that the extra $500,000 or a million dollars was required to put them

The Budget-Mr. Cahan
upon a sound working basis. I am prepared at any time to discuss with hon. gentlemen the question whether the tariff on textile imports is excessive and results in prejudice to the consumers of this country.
The hon. gentleman has mentioned Mr. Blair Gordon. I have not the honour of Mr. Gordon's acquaintance, and I have no personal relations with him. But when the hon. member criticizes Mr. Gordon's position in this matter I can say this, that he has not read intelligently the report of the learned justice, and that he has not made proper deductions from the findings of that report.
The textile industry is one of the most important industries in the province of Quebec as in the province of Ontario. It gives employment to thousands of men and women in this country who otherwise would not have employment. But a discussion of the matter requires more than the time now at my disposal. I rose to discuss the budget presented by the Minister of Finance (Mr. Dunning).
Having carefully read his observations, apart from the statistics which were presented with them, I may say that the budget address of the finance minister might accurately be described, without exaggeration, as a complacent expression of platitudinous inexactitudes, designed to please his hearers by combining into one innocuous pronouncement the variable tenets of the several political groups in this house. It was evidently intended to placate all classes and conditions of our population.
The minister assumes that our external trade is the chief source of this country's prosperity, but he also declares that to the extent that we promote our export trade with foreign countries, to that same extent the impact of every trade recession falls with special severity upon the producing population of this country. In other words, in so far as we look to the acquisition of external markets as the chief, if not the only, basis of our permanent prosperity, just in so far do we give hostages to fortune by placing the control of our economic conditions in the hands of foreigners, who have merely a temporary interest in the stable and efficient development of this country.
In recent years our export trade has not represented more than fifteen per cent of our annual production, while our domestic sales of our domestic products have represented approximately eighty-five per cent of our total production.
The minister also expressed his personal conviction that "it is not beyond the capacity
of an expanding Canadian economy" to absorb those now unemployed in Canada who are willing and able to work. In that conviction I personally share. But measures adopted to expand the sales of our primary products in foreign markets will never, in my opinion, suffice to create employment for Canadians who are now unemployed.
We have a practical monopoly of a few products, such as nickel-as appears from the statement of the Prime Minister (Mr. Mackenzie King) to-day, we have not a monopoly of it, although we are alleged to have-for which foreign countries are dependent upon Canada. Our other primary products find only markets, which are competitive markets, in foreign countries, markets which in times of peace are largely supplied by those of our competitors who pay lower wages and thus force their workmen and workwomen to adopt standards of living which our people will never willingly accept.
We cannot compete in these foreign markets with competitors in central and south American countries, or in European or in Asiatic countries, whose conditions of life are not far removed from those of earlier and more rustic times.
Knowing .as I do from personal contact and personal experience the conditions of life which prevail in many other countries with whose products we now compete in foreign markets, I cannot believe that the oft-repeated fact that Canada, of all countries in the world, with its comparatively small population, enjoys the fourth largest export trade, is a reliable index of national prosperity. In other words, the extent of our export trade, as compared with the export trade of other countries, is not, and cannot under present conditions be accepted as a reliable index of the domestic prosperity of this country.
The minister asserts that this government's "objective has been and is to promote the minimum possible level of unemployment by stimulating the maximum possible level of productivity that could be sustained over a period of time." Such an objective is highly commendable, but the methods adopted by this government to achieve that object are notoriously illusory and futile.
The minister commends the efforts of the government to "restore private capital creation" by an "easy money policy." Those efforts have completely failed of their objective. He says that the government has adopted measures "to restore more normal activity in the construction industry." But people will not exhibit greatly increased activity in the construction or acquisition of
The Budget-Mr. Cahan

hydro-electric resources of the provinces of the middle west, will greatly assist in the development of such secondary industries in those western provinces. I am convinced that our progressive development as a Canadian nation largely depends upon providing such remunerative employment to our own people as will serve to maintain reasonably high standards of living throughout Canada; and to attain that end I am persuaded that it should be one of the essential elements of our national policy, so far as reasonably possible, to conserve our domestic markets for the products of our own workers, rather than to facilitate and foster, as we are now doing, the employment of alien workers in foreign factories for the production of those common commodities necessary for our daily use and consumption, commodities which can readily be produced by our own people, even though in some cases at a slightly increased cost. Our profitable sales in foreign markets, in fact the export trade of Canada, though necessary and commendable, is subject to a hundred contingencies over which our government has no control, such as quotas, local prohibitions and regulations and even the exigencies of foreign wars and civil commotions, which always render foreign trade more precarious and often less profitable than our domestic trade, which Canada should ever assist and encourage. Therefore, while giving reasonable encouragement to a well-balanced foreign trade, an important objective of Canadian statesmanship should ever be to provide increasing, more secure and more profitable domestic markets for the Canadian farmer, as well as diversified and remunerative employment for all who can be employed in Canadian factories.
Employment at remunerative wages is, for the great majority of Canadians, the prime necessity. Their continuous remunerative employment at home is always a matter of paramount economic importance to them, to their families and to the nation as a whole. The warehouses of this country may be full of food products, but they would offer no permanent relief to idle men and women who seek domestic employment in Canada at remunerative wages, and who fail to find it here because the activities of our home factories are restricted by excessive foreign competition, which is chiefly made possible by lower wages and lower standards of living in those competing countries. The workmen and workwomen of Canada are becoming convinced that that economic policy is bad for Canada which tends to deprive them of employment in Canada while opening wide our

extensive and fairly profitable Canadian markets to commodities produced by foreign workers which we can effectively and efficiently produce here at home.

Topic:   THE BUDGET
Subtopic:   DEBATE OX THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
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