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


Walter Frederick Kuhl

Social Credit

Mr. W. F. KUHL (Jasper-Edson):

Mr. Speaker, I wish to state what I believe we must do in Canada if we are to have a united country and preserve national unity. But before entering upon my address proper, I should like to make just a few general remarks with regard to some of the observations which have been made during this budget debate.
If a government does not exist to do for the people what they cannot do for themselves, then I do not know of any reason for the existence of a government. It is, in my opinion, the duty of a government to do for the people what they cannot do for themselves. As the hon. member for Saskatoon (Mr. Young) pointed out this afternoon, there are obvious inequities in our price
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structure, and glaring evidences of exploitation. In such instances where the people themselves are unable to cope with the situation, I deem it the duty of the government to step in and deal adequately with the problem. The Prime Minister (Mr. Mackenzie King), on the evening of the last election, stated quite clearly the duty of the government when he said:
We take up at once, as our supreme task, the endeavour to end poverty in the midst of plenty-
That, I believe, is the first duty of this or any other government in the world.
I am quite convinced that with our existing monetary policy and the manner in which we produce and distribute goods, it is a mathematical impossibility for the people to buy the products of industry without the assistance of the government. We of this group have produced statistics again and again to show that under our present methods of production the income of the people is never sufficient to buy back the products of industry. Therefore, I deem it the duty of the government to step in and so arrange economic matters that the consumption buying power is balanced with the prices of goods that are offered for sale.
It is the duty of the government to abolish poverty in the midst of plenty. The Liberals have had ample time to demonstrate whether they are able to do this. They have not done so. It is physically possible to abolish poverty in this country of ours. We have everything necessary for a high standard of living and there is absolutely no reason or excuse for poverty in the midst of plenty in the Dominion of Canada. The Conservatives had their time in which to endeavour to abolish poverty in the midst of plenty. I am satisfied that in fifty, a hundred, or even a thousand years neither of these parties will be able to abolish poverty in the midst of plenty if they continue to pursue the monetary policies they are pursuing to-day. Here is the reason why I believe they will never do so. As early as 1790 one of the greatest bankers of the world, Meyer Rothschild, gave utterance to this statement:
Permit me to issue and control the money of a nation and I care not who makes its laws.
That is a most significant statement. If that is true, and I believe it is, parliaments are absolutely helpless. The power to create money and put it into circulation is the supreme power. Again and again members of the Liberal and Conservative parties have stated that we must have trade, either internal or external. That is quite true, but in the first analysis trade depends absolutely upon
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money. We are not living in an age of barter, we are living in a time when the production of goods and their distribution and consumption depend absolutely upon the issuance of money. The issuance of money is the starting point, and there cannot be any trade without that. I am satisfied that so long as a private monopoly is permitted to issue money according to its own desires rather than according to the needs of the people, our parliaments will continue to be helpless and unable to cope with the problems with which they are faced. So long as the creation and issuance of money are in the hands of a private monopoly, we in this parliament will be merely playing house; we will be simply engaging in a phantasmagoria no more real than "Snow White and the Seven Dwarfs." We will be unable to deal with any problem just as long as we have nothing to say about our money, and we certainly have nothing to say under the present circumstances.
There has been a considerable amount of criticism of the government because of the unbalanced budget. Considered from the realistic point of view, I do not think we have an unbalanced budget. The cost of everything that we have done in this country has already been paid. In a real sense there is nothing owing. It is only our obsolete and insane bookkeeping system, our financial system, which says that we are in debt and our bills not paid. All our bills are actually paid. After all, what is the real cost of doing anything, whether it be waging a war, building public works or running a railway system? Is there any cost outside human energy, human skill and the consumption of physical materials? Considered from that point of view, we have paid for all the things that have been done in this country.
When was the war paid for? It was paid for when the last shot was fired and the last man killed. The war was paid for on the day on which peace was declared. All the materials, all the human energy and skill necessary to wage a war had been supplied. After all, that is all the cost there is to waging a war. After we have met the real cost of the war, why should we permit a bookkeeping system to insist that we are still in debt? Why should we be obliged to go into debt to a private monopoly simply to get the tickets necessary to bring about an exchange of labour and materials? The same thing applies to any other aspect of our national life.
For instance, take the position of our railways which have been described as a millstone about the necks of the Canadian people. Considered from the realistic poinl of view, our railways are paid for every day
[Mr. Kuhl.)
At the end of every run they are paid for. There are no other costs outside the consumption of human effort, skill and physical materials. The rest is merely bookkeeping. We have paid for all those things for which our bookkeeping system tells us we are still in debt. All these costs have been met. The same thing is true of public works. The physical materials and the human skill and effort have been supplied for all the public works that have been completed. Why should our bookkeeping system then say that we are in debt?
Frequently we are told we cannot afford to do certain things. We are told we cannot afford to build post offices or to carry on a large public works program. We are told we cannot afford this or we cannot afford that. What can we afford? We can afford exactly what we can provide in the way of human energy, skill and physical materials. We can afford whatever we can accomplish with those, the rest is merely bookkeeping. It is the duty and obligation of the government to institute a bookkeeping system which will reflect the real facts. The real fact of the matter is that we are able to afford in this country many things which we have not at present simply because our bookkeeping system and our monetary policy do not reflect these facts. I should like to elaborate considerably on these points, but I want to make my contribution by stating what I believe must be done to achieve national unity.
In so far as the amendments are concerned, I consider them to be in order and I am prepared to support them. I do not do this because I believe that the suggestions contained therein will solve our problems, I do it because I consider them a condemnation of the refusal of the government of the day to pursue adequate policies.
As was stated by the hon. member for Lethbridge (Mr. Blackmore), cabinet ministers are prone these days to conclude their public utterances with a plea for national unit}'. I do not believe that any group of individuals or any section of the Canadian people can claim a monopoly of an earnest desire for a harmonious, smoothly working union in the Dominion of Canada. All true Canadians, regardless of their geographical location, cherish alike this great national ambition. It is a common denominator of desire of all who desire national greatness.
That this ambition will remain merely a fond hope never to be realized is, in my opinion, a false assumption. National unity is possible. A harmonious, amicable relationship between the provinces and the dominion

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can be brought about. An efficient and effective democracy can be accomplished in Canada.
How to reach this objective is, of course, a question upon which there is much difference of opinion. My view is that this objective can never and will never be attained so long as the present financial policy is perpetuated, regardless of what political party or organization has the responsibility of administering the government.
The greatest cause of disharmony, dissatisfaction and discontentment is an impoverished, undernourished and underprivileged people. Canada has actually and potentially the natural wealth and the human resources, both mental and physical, to serve the highest standard of living of any country in the world, not only for her present population but for one many times as large. This enormous supply of real wealth is, however, not fully accessible to the Canadian people under modern methods of production unless the production is accompanied by an adequate monetary policy.
The starting point of all economic activity is the issuance of money. No production or consumption is possible without the issuance of money. Trade, either foreign or domestic, is not the starting point. Trade, either external or internal, is impossible unless it be preceded by the issuance of money. Without money, economic activity is an impossibility in a modem world.
Canadians are not economically secure, they are not healthy, contented and satisfied, because the monetary policy imposed upon them by unfaithful legislators prevents them from accomplishing for themselves that which is physically possible. The money put into circulation through the process of production is not sufficient to accomplish the distribution of the goods produced. It is the duty of the government to do for the people what they cannot do for themselves; otherwise there is no reason for the existence of governments. The present monetary policy cannot do the job it should do for the people. The people cannot alter financial policy; therefore the government must. The government at present in office has not done so, and by all appearances does not intend to do so. The people of Canada, to whom the government should be responsible, are consequently compelled to live far below their privileges. This unjust and inexcusable condition produces ill feeling and discontent, and a distrust in our democratic institutions.
The refusal of the dominion government to institute an adequate monetary policy for
Canada compels the provinces to assume obligations which are not theirs, and for which they are not equipped with the necessary financial facilities. When the provinces under these circumstances cannot satisfy the needs of their people, and the dominion refuses to do so, when it can, how can we expect anything but disharmony, friction and disunity? It is the only possible consequence of such circumstances.
The Liberal party, notwithstanding their fondest hopes to the contrary, have all but ruined even the hope for national unity by continuing to impose upon the people of Canada the existing criminally insane financial policy which they solemnly pledged in the last election they would alter. The Conservative party since changing its leadership has said nothing that even hints at a change in monetary policy were they again elected to power. Canadian unity, under a Conservative administration, would therefore be just as impossible as under a Liberal administration. Both parties, particularly in the last two parliaments, have taken their orders from the bankers instead of from the Canadian people. Why should the people any longer place any confidence in either of these parties when by demonstration they have proved themselves unworthy of any such confidence? Both parties have been given ample opportunity to prove whether they will serve the financial oligarchy or the Canadian people. It is quite obvious that they have decided to obey the money powers rather than the people, and they ought therefore to be dismissed from office forthwith. They have demonstrated that Canadian unity is an impossibility under their policies. They have proved themselves unwilling to institute policies which will make for unity and harmony, and therefore the Canadian electorate should tolerate them no longer.
Although an adequate financial policy would be extremely conducive to harmony and goodwill throughout Canada, I believe there is one other fundamental feature of our national life that must be dealt with. I refer to the constitutional position obtaining in Canada today.
I believe that the cause of disunity is also to be found in the anomalous constitutional position which the people of Canada are tolerating. My opinion is that our constitutional position constitutes a serious reflection upon our conception of democracy, and we are accepting circumstances that should not be tolerated in a country calling itself civilized, let alone democratic. The time is long past due for these matters to be dealt with and clarified. If we wish to gain the respect and
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the esteem of the outside world it is imperative that we put our house in order constitutionally.
Our utterly ridiculous and anomalous constitutional position, which I have discovered through a personal investigation, causes me as a Canadian to hang my head in shame. How those in authority can accept a position which to me as a mere layman is positively repugnant to my conception of democracy and my sense of justice, is beyond my ability to comprehend. I cannot, therefore, remain silent on a matter in which I believe a gross injustice has been done to the Canadian people, and to myself as one of them. On behalf of the people who are aware of. the real nature of the circumstances I must protest, and demand that justice be done.
I have presented my opinions on this subject on several occasions in this house. They have been ridiculed and scoffed at. but to this day no one inside this house has even attempted to controvert the arguments I have put forward or the deductions I have drawn from the facts I have presented. If I am in error in any way, it is the duty of those who know better to point out to me where I am wrong. If I am right, it is imperative that the situation be rectified just as soon as possible.
I am not a lawyer, constitutional or otherwise, but I have made an intensive study of this subject. Speaking in the house on one occasion, the Minister of Justice (Mr. Lapointe) stated that plain people were also interested in these matters. I am speaking as one of these plain people. The issues involved in our constitutional position, from the point of view from which I wish to look at it, are elementary and fundamental. Not only should all members of parliament be thoroughly familiar with them, but every Canadian citizen as well.
Because of my utterances upon this subject I have been accused outside this house of trying to destroy national unity; I have been charged with trying to break up confederation; I have been accused of advocating the setting up of nine sovereignties in Canada; I have been accused of suggesting the abolition of the dominion government. Nothing could be farther from the truth. These are false charges. To give an example of such charges I have here a copy of Liberty of April 1, 1939, and in an article, "It Can't Happen in Canada," I find this statement with reference to myself:
The chief theorist of the party, Mr. Kuhl, denied that the B.N.A. Act had any validity, and claimed for Alberta the status of a sovereign state.
Uu- Kuhl.]
That statement is true. I still contend it is true; I have produced evidence indicating why I believe it to be true, and I ask anyone in this house or outside it to produce evidence to the contrary. The statement continues:
Social Credit members in the federal House of Commons urged the abolition of the dominion parliament.
That statement is not true, and I challenge Liberty or anyone else to point to anything that I or any other member of the Social Credit party inside the house or outside it have said to that effect. I challenge anyone to point to anything I have said inside this house or outside which would give even the slightest suggestion that I had these thoughts in mind. I take second place to no one in my desire for national unity, but I am of the firm conviction that this objective will never be reached until our constitutional anomalies are removed in a manner satisfactory to the provinces and the people of Canada. To overcome these difficulties I have suggested, in every address I have delivered upon this subject, methods which are supported by eminent constitutional authorities in Canada. I had hoped that the Rowell commission report would have been tabled before this session concluded. Upon that occasion I would have discussed what I am now discussing. Since it is likely that this report will not be submitted this session, I am going to take advantage of this occasion once more to state what I honestly believe to be the only way to straighten out our constitutional affairs and consequently to bring about a more harmonious relationship between the various sections of this vast country.
On this point I wish again to quote Doctor Beauchesne's evidence as found on pages 125 and 126 of the report of the special committee on the British North America Act. I had intended to quote rather extensively from the evidence given by Doctor Beauchesne, but because my time is rapidly passing I shall read only a portion of it. I have placed on Hansard, on previous occasions when I spoke upon this subject, quotations from the evidence submitted by Doctor Beauchesne. I believe they are well worth repeating. I am going to read just the last paragraph of this particular section of the evidence which Doctor Beauchesne gave. He made a brief resume of the history of Canada and continued in this fashion:
We have since progressed very materially; our industries have been multiplied; our urban population has exceeded our rural population; the war and its dire consequences have appeared; imperial conferences have taken

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place; the British Commonwealth of Nations has been formed; the statute of Westminster has altered our status. Most of the provinces have lived beyond their means, but they have let up on the autonomy principle in later years. Nobody will doubt that economic legislation in Canada is more difficult of introduction than in any other country in the world, on account of our dual system of government. The time has come, in my humble opinion, when the British North America Act, except as to minority rights, should be transformed and a new constitution more in conformity with present conditions should be adopted. Amendments here and there would be mere patchwork which could not last. The people of 1935 are different from those of 1867. What we want is a new constitution.
Those are not my words. They are the words of Doctor Beauchesne, and his suggestions. I agree with Doctor Beauchesne when he suggests a new constitution. I believe it to be the only thing we can do under existing circumstances.
I wish to summarize the facts and the arguments which I put forward last session and which to date have not been refuted, to indicate why I believe it is our duty and privilege to create a new constitution for Canada.
In my address of February 10, 1938, I showed first the distinction between the two terms, which are used interchangeably but which should not be; those terms are "federal union" and "dominion." I quoted Bouvier's law dictionary, which stated that a federal union was a union or confederation of sovereign states, created either by treaty, or by the mutual adoption of a federal constitution. I quoted also Doctor Ollivier, joint law clerk of the House of Commons, at page 85 of the committee report on the British North America Act, where he says:
A confederation is a union of independent and sovereign states bound together by a pact or a treaty for the observance of certain conditions dependent upon the unanimous consent of the contracting parties, who are free to withdraw from the union.
I stated that these definitions indicate that the status of sovereignty must precede confederation, and that a federal union can be consummated only by the mutual consent of contracting states adopting a constitution. With regard to the term "dominion," I quoted section 18, paragraph 3 of the Interpretations Act of 1889, which says:
The expression colony shall mean any of Her Majesty's dominions, exclusive of the British islands and of British India and where parts of such dominions are under both a central legislature and local legislature, all parts under the central legislature shall, for the purpose of this definition, be deemed to be one colony.
i claimed, therefore, that these terms were not synonymous, but were rather the antithesis of each other.
I showed that according to the preamble to the Quebec resolutions the fathers of confederation intended to create a federal union in Canada. The preamble reads:
The best interests and present and future prosperity of British North America will be promoted by a federal union under the crown.
I stated that the provinces of Canada were in a position to be able to federate because they were recognized by the imperial authorities as being sovereign. To support this, I quoted Mr. Gladstone in the British Hansard of March 28, 1867, at page 754, where he states:
We have for a full quarter of a century acknowledged absolutely the right of selfgovernment in the colonies.
With further quotations from Sir Frederick Rogers, under-secretary for the colonies, and the private correspondence of Sir John A. Macdonald, I showed that although the imperial authorities recognized the provinces of Canada as having the right to create a federal union, they did not see fit to grant them their desires at that time. The British North America Act, which was enacted by the imperial parliament, was not the British North America Act which our delegates desired. It did not conform with the Quebec resolutions.
Instead of becoming a federal union, as the Quebec resolutions called for, Canada was demoted to the status of a colony under the name of a "dominion," which, according to the Interpretations Act, enacted twenty-two years later, was defined as a "one colony." Had Canada become a federal union, an agreement between the provinces would necessarily have had to be signed and later ratified by the Canadian electorate. No such agreement was signed, and the British North America Act has never been submitted to the Canadian electorate for their approval, without which there cannot be a legal constitution. It was not in order for the British North America Act in the form in which it was enacted to be ratified by the Canadian people because it was nothing but an ordinary imperial statute with which the imperial parliament alone had the authority to deal.
The real issue involved at this point is the sovereignty of the Canadian people. Although it was recognized that the people of Canada were supreme over their affairs, owing to the unsatisfactory political relations which then obtained between the United Kingdom and the United States the government of the United Kingdom deemed it advisable to withhold from the people of Canada their independence of action.
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There is a significant difference between the opening of the preamble to the British North America Act and the opening of the preamble to the Australian Constitutional Act. The preamble of the Australian constitution begins:
The people humbly relying on the blessing of Almighty God, have agreed to unite.
Here the people are mentioned. It is they who have agreed to unite. In the preamble to the British North America Act, both the people and God are excluded.
Thus, as a united colony, under the name of "dominion," have we been governed since 1S67. As the provinces were not permitted to exercise their sovereignty they were unable to form a federal union or create a federal government. This was a privilege which could be realized only at some time in the future when circumstances would be more favourable to do so. The opportunity to consummate the ambition of the fathers of confederation eventually came in 1931 through the enactment of the statute of Westminster. Unfortunately, as a result, no doubt, of not having access to the proper information, the people of Canada have, as yet, not taken advantage of this opportunity.
There is a great deal of confusion over the significance of the statute of Westminster and of our constitutional position subsequently to its enactment. For some time I was decidedly confused, but after a considerable amount of study I think I can now see straight through the whole situation. If my opinions do not conform with logic and common sense, then it is the duty of those who know better to correct me.
I have already stated that there is ample evidence to show that through the British North America Act the sovereignty of the Canadian people was withheld from them. They were unable, consequently to federate. The statute of Westminster, in my opinion, now removes the obstacle to federation. By virtue of this act the overlordship of the British people was relinquished and the people of Canada are now in full possesion of their sovereignty. The provinces of Canada were given sovereign status in order that they might federate. They could not federate without this status, but to date neither the provinces nor the people have acted upon this attainment of sovereign status.
Immediately the statute of Westminster was enacted, the people of Canada could have proceeded to complete the task which was begun by the fathers of confederation, but because we have not taken the appropriate

action we are trying to govern ourselves under a constitutional set-up which is so anomalous as to be absurd and ridiculous. We apparently assume that since we have changed our terminology we have changed the nature of our position. This parliament has always been a dominion parliament and not a federal parliament. Calling it a federal parliament will not make it such. A federal government can be created only by agreement among the provinces, which agreement must be ratified by the electorate. This we have not done. What reason, therefore, have we for calling this a federal parliament?
Take the position of a constitution and its amendment. The British North America Act is not a constitution in the true sense of the word. It has been called a constitution and has been used as one, but that does not make it one. A federal constitution is an agreement between federating states and it must be ratified by the people. The British North America Act is not and cannot be a federal constitution. It was designed by the imperial authorities as a statute for the government of a colony, and obviously it cannot be used as the basis of an agreement for a federal union. That is no doubt the reason for the fact that there is no provision in the act for its amendment. If we are to have a constitution proper, then we must make one. We must do as Doctor Beauchesne suggested to the special committee on the British North America Act in 1935.
I had intended to quote Doctor Beauchesne further, but I fear that my time will not permit me to do so. But hon. members who have perused this document are aware that Doctor Beauchesne suggested that we begin this new constitution by calling a constituent assembly of representatives from the provinces, this constituent assembly to draft a constitution w'hich would later be ratified by the people. In the creating of this new constitution provision can be made for its amendment. This would end once and for all the controversy that arises whenever an amendment to the British North America Act is contemplated.
Let us consider another anomalous position which it is difficult to explain-that of the governor general. According to the report of the inter-imperial relations committee of 1926, the governor general is no longer an agent of his majesty's government in Great Britain or of any department of that government. I should like to quote a section of the report of the committee to indicate this. I

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quote from their pronouncement on the position of the governor general, from the report of the inter-imperial relations committee, imperial conference of 1926:
In our opinion it is an essential consequence of the equality of status existing among the members of the British commonwealth of nations that the governor general of a dominion is the representative of the crown, holding in all essential respects the same position in relation to the administration of public affairs in the dominion as is held by his majesty the king in Great Britain, and that he is not the representative or agent of his majesty's government in Great Britain or of any department of the government.

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