Max SALTSMAN

SALTSMAN, Max

Personal Data

Party
New Democratic Party
Constituency
Waterloo--Cambridge (Ontario)
Birth Date
May 29, 1921
Deceased Date
November 28, 1985
Website
http://en.wikipedia.org/wiki/Max_Saltsman
PARLINFO
http://www.parl.gc.ca/parlinfo/Files/Parliamentarian.aspx?Item=6ab1d342-3030-459c-9751-639f09fada02&Language=E&Section=ALL
Profession
business manager, businessman, professor (assistant)

Parliamentary Career

November 9, 1964 - September 8, 1965
NDP
  Waterloo South (Ontario)
November 8, 1965 - April 23, 1968
NDP
  Waterloo South (Ontario)
June 25, 1968 - September 1, 1972
NDP
  Waterloo (Ontario)
October 30, 1972 - May 9, 1974
NDP
  Waterloo (Ontario)
July 8, 1974 - March 26, 1979
NDP
  Waterloo--Cambridge (Ontario)

Most Recent Speeches (Page 2 of 420)


November 17, 1978

Mr. Max Saltsman (Waterloo-Cambridge):

Mr. Speaker, I hope you will find the motion in order, but I must say that if the remarks of the hon. member for York-Simcoe (Mr. Stevens) are any indication, nothing he has been saying recently is in order. I have some unkind things to say of those who are applauding across the way, But I shall leave that for the moment.

I do want to say one thing about some of the comments made by the hon. member for York-Simcoe on the subject of the dividend question. I found it difficult to believe what I thought I was hearing from the hon. member when he was

talking about the rip-offs that came from the loophole being closed in the budget regarding the use of reserve funds and dividends. It was perfectly all right for private industry to do that, but Petro-Canada should not avail itself of that opportunity! An hon. member to my right says he was not saying that at all. I have been listening for years to the hon. member for York-Simcoe but not once have I heard him rise and bring to the attention of the House the fact that this loophole existed for the private sector and that it should be closed. But now that it seems that when Petro-Can is eligible to use this loophole, it becomes a crime!

Mergers go on in this country every day, mergers which really do not provide any new jobs but merely allow for a change of ownership, a change of shares. Again, I have not heard the hon. member raise a protest and say this should not take place, nor have I heard members of his party rise and say mergers are a terrible thing because all you are doing is changing shares, changing ownership, without providing new employment opportunities.

What really seems to be bothering members to my right is that Petro-Can will turn out to be profitable and that the Canadian people will make something on their investment. It is intolerable that anything in the public sector should be profitable! If it is profitable it should be turned back to the private sector, but the public sector should be starved of all these things. We pick up the losers. We are not supposed to go into business and do something profitable on behalf of the Canadian people.

One way of clearing the House of Tories is to tell them what they don't want to hear. They just want to hear themselves talking. They do not realize the incredible double standard they are putting forth as an argument in this House, that whatever the private enterprise system does, regardless of whether it rips off the tax system, regardless of whether it does not create any jobs or not, that is fine, but don't let the government get into the field at all. It is really an argument not based on logic but on a prejudice against public involvement.

I listened to the minister's speech last night and the only thing that came through was a message that we had a minister and a government which were not prepared to provide leadership in this country, had no vision and concern for the future, and did not really want to try to control what was going on in the economy.

It reminded me of a nephew of mine when he was very young. He called me in to watch him in the bathroom as he was performing. He was very proud, and he said, "Uncle, I can do it with one hand". I said that that was pretty good. He said, "Look, no hands," and he took both hands off. Hon. members will know what the consequences were. That is the kind of budget the minister brought in last night. It just splattered all over the place, without hitting the bowl once.

Topic:   GOVERNMENT ORDERS
Subtopic:   THE BUDGET
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November 17, 1978

Mr. Saltsman:

I added my last comment because I was very much afraid that someone might bring up something I said 12 years ago. I was afraid someone would have it tucked up his sleeve, ready to trot out before the House.

Recently the government announced that it was going to cut back on public services. The Prime Minister came out with a great big axe in his hand. I presume he did not tell anyone about it. He came out looking like Henry VIII, chopping off ladies' heads, and saying, "Off with their heads, off with their heads". In the meantime, the heads are not rolling rapidly, nor should they roll rapidly. By the time you get through that exercise you really have not changed very much.

There is room and there is need for scrutiny in the public sector. All of us have some private and pet horror stories about what goes on in the public sector, or all of us should have, and some of us have stories about what goes on in the private sector. These things can only be handled on a day to day and consistent basis with a determination to make the public sector work. This is part of the problem.

If you wonder why bureaucracy is the way it is, and why there is less concern about the public sector than there should be, it is because governments, federal governments at any rate, up until the present time have had a kind of death wish. Sometimes one feels it really does not want the public sector to work. Like my friend, the hon. member for York-Simcoe, instead of putting their very considerable talents to work trying to figure out how to make Petro-Can of more service to the Canadian people, hon. members are busily trying to destroy Petro-Can. Like that hon. member, hon. members in that part of the House do not want Petro-Can to work because that would put a lie to the belief which is currently popular among members of the Conservative party. I say "currently" because things were not always that way. Many good endeavours have come from the Conservative party in its better days.

One of the great challenges of the future is not so much related to whether there should be more or less public involvement. I do not think it is possible any more in the kind of world we live in, and with the kind of future we foresee, for the government to get out of involvement in the economy. No government can divorce itself from that involvement. Quite to the contrary, there is an increasing need for the government to be involved in managing the economy. What is critical is not the extent to which the government is involved in the economy, but the extent to which people in public life ensure that the public sector always performs efficiently and humanely.

Because of our concern about the need for public investment and government leadership in the public sector, I move,

November 17, 1978

seconded by the hon. member for Winnipeg North Centre (Mr. Knowles)-

Topic:   GOVERNMENT ORDERS
Subtopic:   THE BUDGET
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November 17, 1978

Mr. Saltsman:

If we were not on television I would apply a name to it, but the CBC might object.

None of the measures in the budget are really very specific. There is no plan. There is no strategy. As a matter of fact the minister went out of his way in the budget speech to eschew any kind of strategy. He said, "1 am frankly sceptical about a search for a single grand industrial strategy in the competitive market system". What competitive market system? There is some competition in our market, but increasingly the evidence is that it is no longer a free competitive market system.

The minister is thinking about a century which has passed, and trying to solve problems in a modern society with outmoded ideas and an unwillingness to act and behave as a government and a minister should. The message of the budget is that this government does not think it can do anything. It is waiting for the American economy to recover. It is the old story of government after government in Canada. They wait for the Americans to bail us out of our situation. The difficulty is that the Americans are in trouble, as deeply as we are, and perhaps even deeper, and were it not for the fact that many of the things my friends to my right and my friends opposite call socialist measures-things such as unemployment insurance, old age pensions and family allowances-we would be in a worse recession than the one we are in now.

Our economy is suffering greatly. Unemployment is high, and that accounts for a measure of suffering, but at least there is some cushion. There is still some purchasing power left in order that society can move along. The government is waiting for the Americans rather than setting out an independent policy of its own, which is something it could do.

I know it is a common view in both the Liberal and Conservative parties that we really cannot do much on our own and that we must wait and see what other countries are going to do. To some extent that is true, but, having said that, there is a great deal we can do on our own. We should analyse our strengths-and we have many in this country-and act independently of other societies.

Instead of concentrating on exporting to the extent we do- as if we have to export in order to live, and again there is always some truth to the assertion that a certain amount of exporting is necessary-we should be concentrating on import replacement. The province of Ontario has made a tentative move in that direction. Manufacturers in Ontario are being exhorted to look around and see what kinds of things are coming into this country. Most of the things which are coming in are things we could be making ourselves. The purpose of an industrial strategy is to work with the market and with the manufacturers of Canada. We should be saying to them that there are things they can be making in this country rather than importing, and that manufacturing would provide employment, which in turn would provide opportunities to the people of Canada.

The Budget-Mr. Saltsman

We are in a period of high unemployment and, unless government policies change, that will continue for a number of years. However, if we look a little beyond that, five to ten years, there will not be unemployment but a labour shortage. Therefore it seems to me that the government's fear of stimulating the economy is groundless and that in fact we should be stimulating the economy now. We should be building the capital works which are required now.

In statements put forward by my leader on many occasions he has pointed out the things which should be done at this time and the number of jobs those projects would create. For instance, we need a $400 million federal-provincial-municipal capital works program. That has been urgently demanded unanimously by all ten premiers and by most municipalities. That would create 60,000 new jobs. Instead of that we get reports like the one published in this morning's Globe and Mail which says:

Federal move felt endangering renewal plans of municipalities

"Ottawa is trying to curtail their spending at the expense of the municipalities ... It is trying to make us pay for these programs by raising our property

taxes-"

The government is cutting back on its spending, and the consequence of that will simply be that more people will be thrown out of work. The cost of unemployment insurance, welfare, and other social support programs will increase. We should be viewing the present period of high unemployment as a moment of opportunity. Not only should we try to put people back to work, with all that means in terms of the benefits of working and the moral benefits of working rather than being unemployed, but we should put people back to work on projects which will be needed for the future. The need for municipal projects is obvious. The need for urban renewal is obvious.

Another suggestion we have made is that $500 million be spent on railroad upgrading and rebuilding. That has been recommended by the Hall commission. While creating 70,000 new jobs, that would maintain railroad branch lines, and grain elevators would be repaired and modernized. Surely that would be worth while, particularly when we know that the future calls for more and better rail transit services. When is the government going to contemplate this-when we have labour shortages later on, or now when there are so many who are unemployed? All we need is a little direction from the government and a little courageous fiscal management to put people back to work.

Another project we have advocated is a $300 million urban transit program which would provide needed transportation services in urban communities in Canada and create an estimated 40,000 new jobs. A $500 million special housing program is needed to reverse CMHC overspending of its 1977 capital budget by almost that amount. That would provide needed funds for non-profit, co-operative and public housing, and for neighbourhood improvement and residential rehabilitation programs. We think that would create 70,000 new jobs in the high unemployment construction industry. The cost of these capital works projects comes to about $1.7 billion. They

November 17, 1978

The Budget-Mr. Saltsman

would get the private sector involved in important areas of the economy and decrease the level of unemployment. The government should be concerned about moving into these areas, particularly now when the private sector seems so weak and so unwilling to invest.

My friends to the right say that the problem is lack of confidence. The government brings in a regressive budget and says that it is meant to instil confidence in the business community. The official opposition turns that around and says confidence consists of having the hon. member for York-Simcoe in a blue serge suit as minister of finance rather than opposition critic. I think the word "confidence" is grossly misused by both parties. Confidence comes from looking at a government, or an official opposition, which has the courage to advocate programs rather than standing pat all the time, playing it safe and doing nothing beyond the immediate and short-term. There is a reason for this malaise, and again a clear message comes from the budget.

The government is totally preoccupied with the problem of inflation. However, that problem has, for the most part, passed. The government itself acknowledges that the worst of the inflationary spiral is over, that from thereon in-while there will still be inflation and while we still have to be concerned about it-there will not be the rise in inflation we have had for the last number of years.

I am very proud to say that if you look at organized labour in Canada you will find that it has been behaving in a very responsible and concerned way. Its members have, in fact, been taking wage settlements below the increases in the cost of living to demonstrate that. The trade union movement is doing its part in terms of controlling inflation, and I think it deserves a word of commendation.

Topic:   GOVERNMENT ORDERS
Subtopic:   THE BUDGET
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November 17, 1978

Mr. Saltsman:

After such a long period of time, Mr. Speaker, it is going to be a little difficult for me to remember what I was about to move. If I might be permitted, I would say to Your Honour that this is one time when procedure and logic go together. We had the same reservations about the amendment which the hon. member for York-Simcoe offered as you did, and my hon. friend with great prescience framed a motion originally to strike out all those words as though he knew they were offensive both to procedure and equality in tax administration.

Therefore, I should like to move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):

That the amendment be amended by deleting all the words after the words "such as", and by substituting therefor the following words:

"the implementation of a program of public investment in housing, upgrading

of railways, urban transit and provincial-municipal capital works, and this

November 17, 1978

The Budget-Mr. Saltsman

House condemns the government for carrying out a policy of deliberately high

unemployment and for failing to reduce personal income taxes on middle and

lower-income earners. "

I find that despite the changes in the new motion moved by the hon. member for York-Simcoe, it is just as unacceptable as the old.

Topic:   GOVERNMENT ORDERS
Subtopic:   THE BUDGET
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November 17, 1978

Mr. Saltsman:

I see there are many members who agree with that statement. So there is no longer, if there ever was, any pressure from wage demands on inflation.

I was rather surprised to see the following statement in the minister's opening sentences in the budget speech, to give some verisimilitude to a somewhat misleading document:

In recent weeks I have travelled to many parts of Canada. I have talked to many Canadians-my provincial colleagues, businessmen, labour leaders, economists and laymen. Everywhere I have been told that my budget must be responsible.

While the minister does not say so in so many words, he certainly implies that he has the support of labour for this kind of budget, or that labour would consider this budget responsible. I think he must know that on both grounds he is wrong. Labour would not support this kind of budget; labour would not support a budget that does nothing to cure the high unemployment rates in this country, does nothing to increase growth in Canada, and does not concern itself about the future. Labour would certainly not endorse this budget, nor in fact would labour consider that the minister's budget was in

any degree responsible. So the minister should not try to make it appear as if he had the support of labour, because he certainly does not have it. Obviously labour is not pushing in any way that would contribute to inflation.

If we look at the other factors that were blamed for inflation, we find that energy prices have settled down. We do not have the quantum leap, the quadrupling of energy prices which you had a few years ago.

Agricultural prices, after being set back sharply for many years, have recovered some of their position, and there does not seem to be a great push on food prices projected into the future-the minister acknowledges that in his budget speech. The worst of inflation, which has been created by the increased cost of imports arising from the devaluation of the Canadian dollar, is over. I do not think the Canadian dollar will be going down much further than it is now, and, if it does, it is just a fluke, and it will not stay there.

A much greater problem that faces the government-if it is problem at all-is not that the Canadian dollar will go lower but that it will start to rise pretty soon because it is undervalued now, and when it starts to rise it will ease the inflationary pressures in Canada.

What I am putting forward in enunciating these four items is that these are the four main components which go into any assessment of whether things will be more or less inflationary in the future. I think the evidence is stark, it is quite clear, that the past basis for the surge in inflation is over. The government really does not have to pin its whole policy on fighting a situation which is settling down. The war is not over in any absolute sense, there are always problems with inflation, but it is settling itself down.

To say that you cannot stimulate the economy, or you cannot move to provide employment, because you are afraid of inflationary pressure, is not only the wrong analysis of the situation but a dishonest statement about what is happening in our society, and a way of avoiding the necessity of taking responsibility for getting people back to work and getting this country growing again. It is shocking to see this sort of juvenile economics used in arguments put forward by the government.

Again the message is quite clear in the budget, that while the government has tried to show that labour, provincial premiers and businessmen have all asked the minister to present the kind of budget he presented last night, what is quite clear is that the only ones who wanted him to present such a budget are some of the business people who have been advising the government, and to whom the minister has been talking. It was quite clear, from the comments and the reaction after the budget speech last night, that the minister has struck a responsive note and is now competing with the Conservative party for the affection of business in Canada. They have been wrong before. These are the people who have been advising governments over and over again and getting this country into nothing but trouble.

November 17, 1978

Certainly there are many prominent businessmen whose advice is very useful, but to listen to only one side of the argument-because it was only to business that the government was listening-not to labour because labour's priorities are different, not to the provincial premiers, because their priorities are different and they differ among themselves, and to say this is a consensus budget is wrong. I think that the advice the minister is getting is bad advice and will not get the country going.

Let me talk about some of the incentives that are in this budget. The government proposes that the investment tax credit be extended for an indefinite period of time and that it be raised beyond its present 5 per cent level. There are two points about that. First, is it really necessary at this time? The government itself says in its budget address that the indications are that plant utilization is increasing.

A recent report is that a low of 80 per cent to 82 per cent plant utilization has now increased to about 87 per cent. What that means is that when plant capacity starts to approach 87 per cent of utilization, they will expand anyway without incentives. They will not expand at 82 per cent, and all the incentives the government offered in the last two budgets to get them to expand at that level have fallen. All this has accomplished is to fill the coffers of the various corporations which took advantage of those tax plans to depreciate allowances. It has not got the economy going.

Now they may say, because we improved these tax arrangements for business, the economy is starting to move again." I think it will start to move again, but the truth is it will move again because plant utilization has increased, not because of what the government has done with tax incentives, and the consequence is that money will be given away for virtually nothing.

I want to go back to what I said about the rather questionable simile which I used at the commencement of my remarks about my little nephew in the bathroom. If you are going to give incentives all over the place-and we in this party believe there are times when you should be giving far more in the way of incentives to certain kinds of business-you have to do that within the context of an industrial strategy. If you are going to give incentives, you have to do it within the context of knowing that certain industries, if they receive benefits out of public funds, will use those benefits to create jobs, to innovate, to do research, to do something specific for the benefit of the country, rather than to simply make a welfare payment to them through the tax system. That is what an industrial strategy is about, to pinpoint those areas of greatest usefulness for the future development of Canada. Without that, just to give these incentives across the board is like going all over the bathroom. You do not know what it is going to hit and what good it will do.

We have gone through this before with incentives and all the evidence we have, as a result of giving across the board incentives and increases, has been that it has not accomplished the purpose for which the incentives were intended. Quite the contrary, there is now some evidence to suggest that as a result

The Budget-Mr. Saltsman

of government generosity, as a result of industry being given benefits and the absence of investment opportunities, much of those benefits have resulted in cash surpluses for industry which start to move back and forth across the Canada-U.S. border in search of higher interest rates. Many of the problems we are facing, because of the outflow of capital from Canada, arise from the excess generosity of the government giving them more money than they can use. Therefore we find ourselves in this unbelievable position, as a consequence of government action and misplaced generosity which was designed to help industry and create jobs in Canada. We must take action against this misplaced generosity. We must raise interest rates to keep capital in Canada. In the course of raising interest rates, the opportunities for industry to expand and jobs to be created are cut down. The government has created a circular piece of mischief.

I had hoped that somewhere in the budget the minister would have given form to words he has expressed on many, many occasions. He is a very straightforward minister. We have heard him indicate in the House and on public platforms that the level of savings in Canada is too high. He has not said the following but I will extrapolate for him: the tax system has been so generous to people with higher incomes, or industries which could not use their cash flow, that problems of surplus savings have been created. These surplus savings are used to seek nothing but higher and higher interest rates in Canada or the United States. Then a yo-yo-ing back and forth and a jockeying for interest rate preferences occur between one country and the other. If ever there was a government policy which was a clear failure, it is this one. Yet it is included in the present budget.

Does the Minister of Finance and his advisers want this kind of situation? I do not think so. Their industrial strategy and planning are no good. They say the government should stay out of the economy; we should curtail our spending and let the private sector move in. It is a commitment to ideology which causes the problem. That is at the heart of the failure of the budget. The government cannot see this problem. Public policy will fail without planning, intervention, strategy, a setting of priorities or evaluation. The government feels that it must be scattergunned all over the place, without knowing the consequences, benefits, costs or losses.

Strangely enough, while I think the performance of the economy will leave a lot to be desired in the next five or six months, or until the next budget, a kind of statistical optical illusion may take place as a result of some of the measures in the budget. From what we have seen in this budget, I am not too hopeful that any other budget will make any difference or result in much of an improvement. The cut in manufacturers' sales tax from 12 per cent to 9 per cent will do some good. This is something we advocated. We are sorry the government did not pick up more of our package. It only picked up part. To the extent that the government has picked up part of it, one must acknowledge that it will be of some value. As pointed out by the minister in his budget speech, its chief political value

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November 17, 1978

The Budget-Mr. Saltsman

probably will be a drop of one half of 1 per cent in the consumer price index.

In reviewing some of the factors which have led to inflationary pressures in the past, one comes to the conclusion that the consumer price index will start to decline, particularly if the Canadian dollar starts to move up. I do not think the government wants it to move up rapidly, but it will start to move up and there will be a very convenient decline in the consumer price index somewhere just prior to election time.

Another measure which will provide a statistical illusion of well-being is the changes in unemployment insurance. Those changes will knock a lot of people out of the visible labour market and into the invisible one for which no statistics are kept. Even with the government uncommitted to the creation of jobs and admitting that it will create 100,000 fewer jobs this year than in the past year, unemployment figures may drop. Again it is a statistical illusion conveniently appearing some time before the next election. By the government's own admission, the employment effect will be less than last year. Unemployment figures will drop, not because of increased employment, but because a lot of people have been thrown out of the labour force as a result of the changes made in the Unemployment Insurance Act.

Despite the government's effort, the exchange rate will start to rise. Again this will give the illusion of things improving. Today the government argues very vociferously that every time the exchange rate drops it is very good for the economy. But I am sure the government will find a congruous argument as soon as the exchange rate starts to rise, an argument demonstrating how that is even better for the economy. In my estimation, many of the measures in the budget are not very effective and are grossly inadequate to solve the problems we face. Yet these measures will show up as statistically charming in time for an election.

The general public, the taxpayers, the voters and the citizens of Canada are concerned about government spending. They feel that care should be exercised in government spending. These concerns are legitimate ones. Much of what the government has done to persuade those concerned people has been nothing more than an exercise in public relations. Even though my friends on my right have expressed concern about public expenses, they are engaging in a public relations exercise as well. As a matter of fact one of my friends in the Conservative party expressed concern about what the government was doing in relation to Petro-Canada. His concern was that by enlarging the role of Petro-Canada the government is making it impossible for his party, when it forms the government, to sell Petro-Canada, because the stock market will be disrupted too much. Thus, I would say to my friends who have been berating Petro-Canada up and down that they should be careful and heedful of that. Perhaps they will end up being the custodians. Who knows, perhaps the hon. member for York-Simcoe will be made commissar in chief of Petro-Canada? Then he will have to eat some of his words, as the present Prime Minister (Mr. Trudeau) had to eat some of his words about the Liberal party

on another occasion, and as all of us have to do from time to time.

Topic:   GOVERNMENT ORDERS
Subtopic:   THE BUDGET
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