Mr. Speaker, since the House rose, three hon. members have asked me to deal a little more fully with the briquetting plant at Bienfait, with regard to which I had made a few remarks before six o'clock. I have some figures here, which, perhaps, will be interesting to hon. members and also to many of the people of Canada, particularly the people of western Canada. We are very much interested in the question of the supply of fuel; in fact, to us in the West the matter is quite as pressing as is the question of the tariff. As the time of the House has not been occupied at any considerable length in a discussion of the fuel problem, I wish to devote a few minutes to it now.
The information that I wish to give to the House is with regard to the value of the briquettes manufactured at the town of Bienfait as compared with a like product which is being sold in Winnipeg at the present time. According to information which I have received, the briquettes manufactured at Bienfait would be worth $12.25 a ton, as at present estimated, f.o.b. Bienfait. These briquettes have approximately 11,500 heat units per pound, and exactly what they would be worth in the city of Winnipeg can easily be computed. We find that under the present freight rates, this commodity, worth $12.25 per ton, must be retailed in Winnipeg at $17.50. It is quite evident, therefore, that a product selling at $17.50 in Winnipeg, and containing approximately 11,500 heat units per pound, cannot successfully compete with a similar product containing 15,000 heat units per pound, and selling in Winnipeg at $17 per ton. I think I am justified in directing the attention of the House to the fact that even if we should find it possible to make a briquette from the low grade lignite which is found in the southeastern part of Saskatchewan, we are not warranted in continuing its manufacture, because we should have to compete with a briquette product already on the market which can undersell us on the basis of heat values, by one-fifth. Now, that is good, sound reasoning..
I have also been asked to explain further how this low grade coal can be used. It has been proved beyond doubt that anthracite, lignite coals in all their grades, and even peat can be successfully produced in powdered form and used in furnaces and ranges, both for domestic, and for commercial purposes. By the use of a very cheap power plant, operating by air pressure, the powdered product is forced into the receptacle in which it is burned and the amount used can be controlled by a tap. It is estimated that the use of such a plant would save in the household or in the manufacturing plant approximately 23 per cent of the amount now being expended for fuel, and that is a large item, especially on our western plains. If we can commercialize in this way these large deposits of lignite coal and save every farmer and every industry in western Canada 23 per cent of their present fuel costs, the effort shall have been well worth while.
Now, here is a splendid opportunity for the high protectionist to step in and to say that we should introduce protection on behalf of the production of this commodity, with its lower heat unit content and its relatively high cost. That is the argument of the protectionist in all cases; but I do maintain that the principle is fallacious. This is, in my opinion, a very clear illustration of the fallacy of high protection, and many cases analagous to the one which I have cited may be mentioned. We have an almost unlimited supply of this coal and it can be commercialized and prepared for use in an economical way-economical, because of the elimination of waste. All we would require to have at the mine would be a drying plant and a powdering plant. The
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coal would then be distributed throughout the country in the form of powder, and, as I have said, by the use of a small power plant it can be fed to the stove in a very satisfactory manner. It is much cleaner than ordinary coal and is much more satisfactory in every way. Without going into the matter any further I may say that I have in my office a long treatise on the subject and I should be only too pleased to give any further information to hon. members who are interested in it.
I wish again to draw the attention of the Government to a matter which has been mentioned on the floor of this House on two or three occasions during the present session. It has to do with the liquor question as affecting the southeastern part of Saskatchewan. A very regrettable condition exists there. In the lower part of my own electoral district, about seventeen export liquor houses have been continually carrying on the export of liquor, both to other provinces and outside the country, since the referendum was taken in that province. I do not want to say this with any egotism, but last year I endeavoured to find out who was responsible for granting permission to these institutions to operate in that province, and was unable to do so. Again this session, with the cooperation of the hon. member for Qu'-Appelle (Mr. Millar), I endeavoured to place the responsibility. I am not sanguine enough to hope that I have yet succeeded in finding out who is responsible for the condition which still obtains there. Not more than three days ago I received a letter stating that what are known as booze cars were running back and forth throughout the country. My people have protested in all earnestness against the existence of these houses, and if I am impotent to find out who is responsible for their existence, I think I have done my duty in bringing this matter to the attention of the House, and I hope that the Government will still co-operate with the hon. member for Qu'Appelle (Mr. Millar) and myself in an endeavour to place the responsibility.
I was much interested in an item I read in the paper a few days ago, and it may have some bearing on a solution of this problem, to the effect that a decision which was given in the Michigan courts some time ago sustaining the export of liquor to foreign countries and its importation from outside had been over-ruled by the Supreme Court of the United States. On May 15 the Supreme Court of the United States
handed down a decision in which they held that liquor while within the boundaries of the United States en route from one foreign port to another, could be seized under the national Prohibition Act. It may be that the United States will take advantage of this decision in connection with the international exportation and importation of liquors, and that may have some effect on those establishments in the United States. I hope it will have, simply because, as I have said repeatedly, the establishment and the retention of these institutions is much deplored by our people. These houses are a veritable nuisance in my district.
I wish now to say a few words with regard to the banking system of Canada in connection with the budget which has been presented to the House. Some ^people speak very strongly in favour of the banking system of this country, yet I think there are many reasons why we should consider whether we really have the very strongest banking system possible. Some years ago we had in the west the Northern Bank, which later merged with the Northern Crown Bank, which in turn was absorbed by the Royal Bank. A few years later we had the failure of the Farmers Bank, and there was a sorry story to be told in connection with that. Only recently we had the merger of the Merchants Bank with the Bank of Montreal. Fortunately, in that case the Bank of Montreal was strong enough to take care of the depositors of the Merchants Bank.
Bank clearings last year amounted to sixteen billions of dollars. That is a huge sum of money for the banks of Canada to handle, and it seems to me that in view of that huge turnover we have a right to make the banks pay a proportionate amount of the taxes of this country. In an address I gave in this House last year I made the statement, which can be substantiated, that the banks receive very liberal concessions, both in the way of credits by this Government and in the way of license they receive to send their own credits in and out of the country, and a further concessior. in connection with their building assessment. I pointed out particularly that in making their returns the banks give only the initial price of their buildings. I stated that I believed the great banks of Canada could hide, and were hiding their assets by being allowed only to send in the initial cost of their buildings. Let me give a homely illustration. An individual, whether he lives in a town, city or village or in the country, when he purchases a house or a
The Budget-Mr. Gould
farm soon finds that the initial price is not the price the property is allowed to toe assessed at for very long. As the district improves and settlers come in, the value of the property is increased, and the assessment accordingly. If that holds good in the case of the individual, I think it should also be applied in the case of the (banks.
I do not know what portion of this sixteen billions of dollars represents cheques, tout the total will be made up of cheques, acceptances, and general currency. If that is the case, at a very conservative estimate this sixteen billion dollars should stand an assessment of at least $5,000,000 to be paid into the Dominion treasury.
With regard to the stamp tax on cheques, and I am sorry to say that my leader was the first member of this House to regret the placing of stamps upon cheques issued by great corporations, let me say that many corporations in this country are only stock companies that are doing business on the money subscribed for their stock by the people of Canada, and they can well afford to pay this stamp tax. Let me give another homely illustration. The average individual whether he lives in a village, town or city, sometimes leaves ten or perhaps fifty dollars on deposit at the bank, if he is fortunate to have any money to bank, and when he wishes to purchase the necessaries of life, particularly in the country, he sends in his boy or some member of the family to buy five dollars' worth of groceries by cheque against his account, and in that way it will very soon cost him 50 cents in stamps to cheque out that fifty dollars. The individual has to pay that, so why should not big business men be called upon to pay the two-cent tax on every fifty dollars? I have seen it stated in the newspapers that the Finance Minister might modify his proposals in regard to the stamp tax. I trust that he will do nothing of the kind, simply because we have pleaded long and hard and earnestly that big business should pay its fair proportion of the taxation, and so far as this stamp tax is concerned, they have no right to hedge. Furthermore, if I can afford to pay $5,000 or $10,000 for a house or farm I can afford to pay two cents on every $50 cheque I issue, as the budget proposes. I would again urge the Finance Minister, if he was thinking of making a change in this tax, not to do so. I would rather see the tax graduated so that the larger the amount paid out by cheque, the greater the tax would be.
To return to the banking system of this country, and to show you to what extent the business of this country is tied up in these large banking institutions, we had in March, 1922, $1,230,000,000 of savings deposits in the banks of Canada, and of that amount $290,600,000 was on deposit with our largest institution, the Bank of Montreal. I am not singling that bank out for criticism at all, and only mention it to show the extent to which the banking institutions of this country control our credits. The savings deposits in the banks and the credits of the country are proportionately the same, and if the Bank of Montreal controls, as it does, one-quarter of the savings deposits of this country we have a right to assume, and we do, that it controls 25 per cent of the credits of the whole Dominion of Canada. That is an enormous power to be placed in the hands of any one institution, and while there are people who will say that it is all right, there are other people, and perhaps more, who will say that such a power needs looking into to see if we cannot find ways and means whereby these large institutions can be made to serve the basic industries of Canada and the interests of the people as a whole.
In any case, I hope the Finance Minister will not be persuaded to make it more difficult for the fundamental businesses of this country to find the cash, or the wherewithal, to carry on their undertakings. As has been stated, Mr. Speaker, we had a national debt of $2,427,296,798 in 1922, but in 1914 it was only $335,966,850. I have compiled a few figures which I will give you approximately. I do not do so with the idea of causing the publication of newspaper headlines to scare the people of Canada, but rather with the object of pointing out to them the absolute necessity of realizing the burden which rests upon the shoulders of each individual, so that they may better apply themselves to the task in hand of meeting that burden. My whole argument would be to arrive at some equitable means of assessing the taxation of this country. I am sure that when the people rightly understand the burden that is placed upon them they will not cry out so loudly. Convince the people that the taxation is necessary and that the method of assessing that taxation is equitable, and they will be better satisfied. On the basis of the figures that I have submitted the per capita debt of Canada would be $277.70. Now for a family of five, which is usually accepted as the basis of
1 i '!
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computation, the debt would be $1,388.50 for the year 1922. In 1914 the per capita debt was $38.20, and in the case of a family of five would he approximately $191. It is no wonder there is concern in the public mind. Even in 1910 and 1911 there was a great hue and cry throughout Canada at the cost of government and the per capita debt; and when we view the situation to-day and find that we are burdened with approximately $8 for every $1 of debt at that time, the people are justified in paying more attention to this question of taxation. Apart from this huge national debt, we require to pay $466,983,359 this year which means a per capita charge of $53.27. Multiply that by the figure 5, representing the average family, and it comes to a total of $266.35. F urthermore, we have provincial and municipal debts, and taking these into consideration the debt per capita for carrying on business this year amounts to $466.35. Now it is positively alarming that we should have to bear such a per capita annual debt as $466.35. Even this does not make provision for the payment of one solitary cent of the bonded indebtedness of Canada which, as I have already said, is dangerously near $2,500,000,000. Bearing these facts in mind is not the question of taxation one that should be seriously considered? Is it not urgent that much greater attention should be paid by the people as a whole not only to the principles upon which that taxation is based, but also to the problem of devising ways and means whereby that taxation can be met.
Now, I want to make a few references to some of the things which have been said during this debate. The Minister of Justice (Sir Lomer Gouin), for example, gave figures to show the operation of the tariff from 1876 to 1901. He endeavoured to show that the percentage of taxes now gleaned from the tariff was not as great as it was in the period referred to. In so far as percentages go, the figures given by him were absolutely correct; but the minister failed to state that since the time to which he had reference many new forms of taxation have been applied, and therefore the percentages which he gave with respect to the operation of the tariff are less deserving of weight than he seeks to make out. The minister asked whether we could get along without the manufacturers. Certainly we cannot; no one in this country ever thought of such a proposition. I am sure that notwithstanding [Mr. Gould.3
the fact that the Progressives in this House have invariably been characterized as free traders, the fact remains that never from this corner of the chamber this session has any one proclaimed himself a free trader, nor do I think that any such statement was made during the election. We have asked, in particular, that in fulfilment of the planks of the platform upon which we stand, and likewise in fulfilment of the platform upon which the Liberal party professedly stand, the implements of production should be free of duty. Let me give you an illustration of how the tariff works out in that regard at present. Take a section of land, the cultivation of which probably necessitates an expenditure of $3,000. Before the man who farms that land can commence to raise anything with which to compete in a free trade market-for he really has to face unrestricted competition when he sells his products-he has to meet an average duty of 15 per cent. This, if applied to a capital of $3,000, means that he is fined to the extent of four or five hundred dollars. The amount will vary in localities in accordance with the difference in the value of the farm land. On the average, however, the farmer finds that he has to meet a charge of $400 or $500 before he can enter into business. In addition to that he bears his share of the duty on other articles that enter into consumption the same as any one in the town, city or village. But I maintain that the duty referred to is an extra tax levied upon his industry, and he is handicapped to that extent when he goes out into the markets of the world to sell any of his products. Success in agriculture is a doubtful thing. When it flourishes in Australia it may be a failure in Russia; when there is a good crop here in Canada the crops may be poor in the Argentine. These are factors that have to be considered. I suppose that if there ever came a time when agriculture was successful in every country of the world the industrj would become depressed and be liable tc succumb by reason of its very productive ness.
I recognize that simply to stand here and indulge in pious wishes with respect to the beneficiaries of a protective system will never get us anywhere. But the people of Canada have been lectured and lectured on tariff matters ever since 1873, at least, and wherein have they benefited? What have the people of Canada received? Well, we have received nothing.
The Budget-Mr. Gould
It is amusing to realize the position taken by the, small group known as the Conservative party on the question of the tariff. They say, "We stand for a protective tariff," but I have heard them quote instances where they lauded and praised themselves, because they had succeeded in reducing the tariff. It seems to me that it is absolutely inconsistent for them, at one moment, to be raising the banner on high and proclaiming "We are a protective party," and the next moment to take the compliment which might be paid them for reducing the tariff. Yet, on the hustings and in this House we have had instances of this, and I ask hon. members to try and explain their attitude. However, it is useless to plead with, or to quote instances, and give illustrations to, the beneficiaries of the system. We have been sent here for a direct and specific purpose, and I think we should have received more consideration in the budget which has been presented to the House. If we should link cur forces with those on the other side, our platforms being very much the same, are we not right in assuming that all Canada is strongly in favour of the sentiments expressed in our platform, or in their platform, or in both? It was stated on a thousand platforms during the last campaign, that there wa< no difference between the two platforms, and that was one of the strongest pleas and arguments advanced why the Liberals should be returned to power. There was so little difference in our platforms, it was argued, that they should be returned to power.
It is extremely disappointing, now that the opportunity has been given the Liberal party to implement the pledges made since 1896, now that the people of Canada have said, "We wil try them once more," and have reposed their trust in them, to find the country presented with a budget such as that which Lss been brought down by the Minister of Finance. I think, Mr. Speaker, the people of Canada will not forget it, and if the rejection of this budget at this time should render it necessary to go back to the country, a different story will be told, because the people did expect, Sir, that there was going to be another kind of budget brought down. Listening to the speeches which have been made by hon. members opposite, the thought came to me with a rush, and came to me repeatedly: Are these deliverances typical of the speeches made at the great Liberal convention held in August, 1919? Is this the type of speech which one would expect,
following the resolutions which appear in the Liberal platform? I think not. While the excuse has been offered during this debate that conditions have changed, I want to point out the conditions at the time the platform was framed, and when the war was on. The people knew or anticipated what the conditions would be, in fact we knew, and it was advertised at that time, that there would be a period of depression and yet the Liberal party went into convention in Ottawa in August, 1919, and framed their platform. I have been informed by one gentleman who attended the convention, with whom I have talked to a considerable extent, not a member of the House of Commons, but a gentleman who was present when the platform was framed, that he was ashamed of the interpretation that was placed upon this platform by the budget speech.
Subtopic: CONTINUATION OF THE DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE