February 19, 1926 (15th Parliament, 1st Session)


Donald MacBeth Kennedy


Mr. KENNEDY (Winnipeg):

I will tell
you what in my opinion is the reason. The importance of a tariff policy is not so much the height of the tariff as a definite, consistent policy which will stabilize business. Very often the mere threat of substantial reductions creates just as much harm, sometimes more, than the actual reductions themselves.
I want to say, particularly to the members of the Progressive party and to those Liberals who are open to conviction, that one of the things our party has chiefly to fight is misrepresentation in connection with the respective positions of the different parties on the tariff. Throughout the length and breadth of this country, at every election, the Conservative party is represented as being a high protection party, and the Liberal as a low tariff party. You ask the representatives of the Liberal party how high the Conservative party believe in putting the tariff, and they will not tell you. They will use some expression which conveys the idea that there is no limit to the height to which we will go in raising the tariff. You ask

The Address-Mr. Kennedy (Winnipeg)
them how much the Liberal party will reduce the tariff, and they will not tell you. So then it is not a question of a high protective party or a low protective party but, having decided that we must have a tariff, the question is how high shall that tariff be? There I think we can meet on common ground.
Let me submit an illustration: Supposing that in the city of Ottawa there is an industry employing, we will say, 150 men, manufacturing a commodity which enjoys a protection of 15 per cent. We will say that the government proposes to reduce the duty on that commodity by 5 per cent. Representations are made by that industry against the reduction. Forgetting altogether whether they are free traders or protectionists, if any five lion, megabers of this House were constituted a committee to decide whether or not that tariff should be lowered I submit, if they went about the matter in a business-like way, they would proceed somewhat along this line: First of all they would inquire, "Is that an industry that is good for the city of Ottawa and for this country?" Next they would say, "Open your books and show us why you must have a protection of 15 per cent?" If they show it is because they have to meet competition in respect of goods manufactured on a lower scale of wages in another country; if they show that they have to manufacture here under conditions which do not obtain in the competing country, then it must be decided whether it is desirable to give them the safeguard that they have asked for, or let them go out of business. Without carrying the illustration further, I submit it comes down to the question: shall we give them some protection? Then the next question is, how much? How shall the committee decide? Doubtless they would say: "Open your books and show us how much protection you actually need to carry on?" If the committee were of opinion that it would be bad for the city and bad for the community for that plant to close up they would say "We recognize that you are paying wages of sixty cents an hour, whereas your competitor is paying thirty cents an hour. We recognize that you aie manufacturing here under conditions which do not obtain in the competing country. We recognize the fact that you are paying your workmen on an hourly basis for a period much shorter than the working day period of the employees in the factories of that foreign competitor. We recognize that this country is basically a country of high wages."
Therefore, in deciding what protection should be given, I submit that for these reasons the committee would say, "We will give you such a measure of protection as will enable you to continue your business, pay your workmen the standard wage that is demanded in this country, and allow 3'ou to get a reasonable profit upon your investment." That, I submit, is the test which should govern the decision in a matter of this kind. That far, I submit, as far as I can judge, is the extent to which the Conservative party should go in the matter of protection and no further.
But why a tariff at all? I think I have demonstrated why there should be a tariff. Let any hon. member take his own town. To bring the situation a little closer home take the city of Brandon, for the sake of choosing the constituency of the leader of the Progressive party (Mr. Forke). We will say there is a plant there manufacturing some commodity under these conditions-basically high wages, hours which are regulated by statute, under our commendable laws which .prohibit the employment of child labour, under conditions where a man can only be required to work so many hours a day, under conditions where he has to receive that certain standard of wages necessary in this country in order to buy the necessaries of life-fuel, clothing and food for himself and his family. Then, if there is no tariff that manufacturer has to compete against a competitor-we will say in the state of Alabama, or any of the southern states, where the climate is warm and labour [DOT] is cheap. If the Brandon manufacturer pays sixty cents an hour to his employees and has to compete with goods manufactured by cheap labour, such as negro labour at 17 cents an hour; if he has to have an investment of $80,000, under the conditions in this country, as to heat, weather, and so on, as against an investment of probably only $8,000 down there, you will take those matters into consideration, and will make up your mind first of all as to whether that particular business should continue or not. If you do not believe in the policy of protection you will say, as some hon. members here say "No; if this institution cannot stand on its own feet without protection it does not deserve to live", and you will not give it protection. Then, by reason of the fact that it cannot compete with the goods brought in from the south, you know what will happen. You know what will happen if a concern cannot sell as cheaply as its competitors. There is only one end. That Brandon factory goes out of business. Suppose that factory employs 150
The Address-Mr. Kennedy (Winnipeg)
men? Very well, they are thrown out of work, and they join the ranks of the unemployed. You have to consider if that is a good thing for the city of Brandon? Whom does it affect? Is it only the manufacturer, with whom we are often said to be linked in some special way?

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