Mr. Chairman, I should like to say a few words to the minister in this connection. I was surprised to hear the minister talk in the last few days about the international crisis and then brag today about the financial systems of all the nations in the western world. I cannot help but say to him that he has put forward one of the greatest contradictions in respect of finance that I have heard for a long long time. Surely he must understand that the people of Canada,
having considered the situation very carefully, have decided that the present financial system of the government has failed absolutely due to the fact that bank interest rates are now as high as 12J and 13 per cent. If anyone in this or any other country suggests there is a sound reason that interest rates should be as high as 12 or 13 per cent, then all I can say is 1 would have to see much stronger evidence than I have seen to date.
I believe that any alert minister of finance should be very careful to listen at this time to anyone who has anything to offer, whether it be good or bad, and assess what he has to say. Otherwise the minister would be very much like the individual who, when a person to whom he owed some money said "let us cancel the debt", said, "I would rather die owing you than not pay". If the minister continues in this way we will be faced with a situation which no one in this or any other country would like to see.
I should like to refer briefly to a small but powerful book. I suggest the Minister of Finance is quite aware of it. It was written by Vincent Cartwright Vickers. He was deputy lieutenant of the city of London, a director of Vickers Limited for 22 years and a director of London Assurance from which he resigned in January, 1939. In 1910 he was made a governor of the Bank of England and resigned this appointment in 1919. I wish the minister would compare what Mr. Vickers had to say with the situation which has been outlined by the minister over the last couple of weeks. In the opening paragraph on page 1 of this book entitled "Economic Tribulation" Mr. Vickers had this to say:
Slowly but Inevitably the old financial system is crumbling under the weight of modern conditions and the better education of the people; the sooner it crumbles the better, and the sooner it gives way to a better and more modern technique the sooner will the world achieve good will and peace amongst men.
The present order of things must change. The economic structure of civilization is obviously leaning heavily. To build upon it, to add weight to it as it now stands, crooked and unsafe, can only bring nearer the day of its collapse.
Today we are approaching the situation this man had in mind when he said that slowly but surely the mills of the gods would grind. What was written in 1941 by this man who for nine years was governor of the Bank of England we find expressed in the words of the minister today. When the minister says he does not understand what is meant when someone talks about changing the situation to one of an increasing involvement by the Bank
March 14. 1968
of Canada in the debt of our country, I cannot understand to whom he is listening.
[DOT] (4:10 p.m.)
The minister said today that we have a fine financial system. Yet we find him also saying that the world is facing a terrible crisis and that the international monetary situation is almost beyond repair. We are now experiencing one of the greatest financial crises we have ever experienced. The situation is almost chaotic. It does seem to me that the time has come when we must stop burying our heads in the sand like ostriches and waving our tail-feathers in the air like palm trees. According to the Minister of Finance that is the position we are to assume.
I do not think the minister listened to what the hon. member for Villeneuve said and I do not think he intends to read what he said when and if he ever has the chance during the campaign. Let me tell the minister that if he expects to become the prime minister of this country and take it upon his shoulders to formulate Canadian policy he had better keep his ears tuned to some of the things which have been said. Let me refer him to the warnings given during the meetings of the committee on finance. He was told that if there was not some control of competition for deposits by trust companies and banks we would find ourselves in a terrible position because of high interest rates. I do not know how anyone can find himself in this position without being very much concerned. When we were discussing the effects of competition for deposits the Governor of the Bank of Canada said he did not anticipate high interest rates for ten years. That was the shortest ten years of my life.