Mr. Stan J. Hovdebo (Saskatoon-Humboldt):

Madam Speaker, it is my honour and duty on behalf of a number of people mostly from Saskatoon to present a petition. It calls on the government to take action relative to the unanimous motion of the House of Commons on September 27, 1991 and settle the acknowledgement and redress issues to the mutual satisfaction of the Ukrainian community and the government.

This issue was raised in a speech by the Prime Minister in October 1992 where he expressed the intention of the government to do this. The petitioners ask the government to proceed in that area.

Mr. Stan J. Hovdebo (Saskatoon -Humboldt):

Mr. Speaker, I was going to comment on the remarks of the member for Hamilton West who, if his party has no policy on something decides that he should attack the other, but he seems to have disappeared, so there is no value in making those kinds of remarks.

One of the main concerns of many people in this party and many people across Canada regarding this legislation is that it gives up the levers of power relative to the economy of Canada. Those levers of power are necessary for Canada to re-establish the growth of its economy and the building of its economy.

This subamendment tries on behalf of Canada to repossess some of those levers of power. Many of the clauses and agreements accepted in the free trade agreement have weakened Canada's ability to make use of the natural advantages which Canada has.

What the free trade agreements have done is weaken the position so we cannot use those natural advantages to develop our own economy and make sure that we have a stable and secure structure which will continue year after year.

I refer of course to a number of clauses, one of them being the natural treatment clause which requires governments and corporations to give U.S. companies the same treatment as if they were local. This clause lost us the ability to give preferential treatment to Canadians companies. That is the kind of negotiation that has been going on in the free trade agreement which has weakened Canada's economy. It made it less able, more difficult for Canada to establish a solid base for its economy and make sure that companies can compete in our own market as well as in other markets of the world.

Worse still is the free trade agreement's requirement to sell our energy to the United States at the same price as we sell it to a Canadian company. In other words we cannot use our cheaper gas, petroleum projects, cheaper hydro to convince companies around the world to come to Canada because we can give them a little benefit of our natural advantage in energy production. If we could offer them hydro or gas at cost, they would come to Canada.

The Quebec government has been doing this and is trying to do it still. It found itself being pinpointed by the U.S. because it had offered a Norwegian company a better deal on hydroelectric power than it was selling that power to the United States. Quebec was forced to back off that particular agreement.

This clause forces Canada not to sell energy at cost, but to charge the same as it charges in the United States. What we charge in the United States is what the market will bear in most cases. It does not help us to build a stable and effective economy at home.

The Mexicans were smarter. In the NAFTA they said: "We will not have you affecting our energy production. Our hydro and our gas and oil will be controlled by us. We will sell it at whatever price we hit and we will sell it to anybody we want to". They have taken advantage of their natural advantage in oil and gas and hydro.

In the free trade agreement we have given up these natural advantages. This subamendment, in fact this whole amendment, would at least let us try and regain some of the advantages we lost on the free trade agreement by making this bad deal of NAFTA at least a better deal.

We are discussing amendments which would try and make a bad deal a better deal if it does pass. Hopefully we can stop it from passing but with a government majority, under our present system of government, if the government decides it is going to pass it is likely to do so if the government can keep us around long enough.

By this amendment and the subamendment we will allow Canadian governments to require, if they wish, that our resources be processed before they are exported. Again this is an effort on the part of this party to put into the NAFTA the kind of levers of power which would allow us to make sure our economy can be improved and stabilized by those advantages which we do have.

Levers of power are important and most countries use them quite well. Sometimes they are levers of power just by the size of the purchase. For instance Japan buys a considerable amount of our canola. It demands all of it to be unprocessed. The seed is shipped to Japan. It would not be very profitable for us to ship that canola there as oil because then the processing would happen here in Canada.

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However the U.S. tries not to buy our oil. They want the canola whole. This is a use of the levers of power. Marginally these would not be affected by NAFTA but that is the kind of power which we should be grasping here in Canada to make sure that our economy is solid and able to grow.

The point I make here is that we can only develop our economy if we have the power to require processing of our resources. That is what this subamendment does. Things like the production of grain, minerals and energy are natural advantages which could make our economy more vibrant, help it to grow and make it more stable. If we do this kind of processing at home then we have the effects of that growth and that vibrancy.

This amendment and subamendment would allow us to make sure if we decided we want to do it to be able to do it. Processing our resources, manufacturing and fabricating projects for ourselves and for the export market makes sense and is supported by all of the economists, even those who support the NAFTA deal.

They all say that what we need to do is more processing at home. That is the basis under which they say our economy can grow. All this subamendment does is say put that into this act so that we have the power to require, if possible, anyone within our jurisdiction, within the sovereign state or the sovereign provinces as it happens, to require any product shipped out of that area to be processed if that is desirable.

Why then is the government making this kind of stupid mistake in giving away an advantage and then not making it part of the law of Canada? Why is it taking an almost anti-Canadian position as far as development, as far as processing, fabrication and manufacturing is concerned, forcing companies to go where it is cheaper to buy, to build and not asking them to take at least a pro Canadian position.

The subamendment has special effects on agriculture. We could and should be self-sufficient in food. We are losing that ability of self-sufficiency quickly because we are not making use of the possibilities of processing our products at home. The philosophy of free trade carried to its final level will force all kinds of production out of

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Canada into areas where they might have a slight advantage in other ways.

Mr. Stan J. Hovdebo (Saskatoon - Humboldt):

Madam Speaker, it pleases me to have this opportunity at this hour of the morning to get up and indicate my feelings about these particular motions relative to the North American free trade agreement.

I will start by speaking on Motion No. 2 which states:

That Bill C-115 be amended by adding immediately after line 45,

at page 3, the following new clause:

"3.1 Canadian Laws to Prevail in Conflict. No provision of the Agreement, nor the application of any such provision to any person or circumstances, which is in conflict with any law of the United States shall have effect."

In other words all we are asking is that our law have the same weight in this agreement as does U.S. law. By putting this particular clause in, the Americans made it possible for them to absolutely control the structure. Any U.S. law has effect. It says so in the U.S. implementation act of 1988. We are suggesting that maybe we, the Canadian people, the Canadian government should have the same kind of power over this particular act.

In Motions Nos. 4 and 5 we are also asking to have the ability to process our products before we ship them. That

is, we want to keep those products here long enough to do something with them. The present act does not allow us to do that.

Even if we passed a law saying that we will not ship anything out of Canada which is not processed, we could not do that under this act because we do not have the kind of legislative structure which would allow us to do

it. The U.S. could do it. It is in the act at the moment and the Conservative government accepted that.

We have accepted very little of what the Conservative government put in these acts in the sense that they basically sold out our right to develop our economy. We as a party believe that trade is very important to Canada, but trade under circumstances which give us the power to develop and the ability to develop our economy within the structure that we believe should be in place.

With Motion No. 2 we wish to put into the act the fact that Canadian laws are to prevail in conflict. Anytime we get into a disagreement with the United States we apply the laws of Canada just as they now apply their own laws when they get into conflict.

One of the big things that has affected us in the agricultural industry has been the export enhancement policy of the United States. The Americans have put millions of dollars from their treasury into the sale of grains particularly, but other products as well.

What has affected the farmers most in Canada has been the export enhancement program which spends millions of dollars on selling the grain. Because of the way it is set up, this particular enhancement does not necessarily go directly to the farmer. We cannot call it a farm or an agricultural subsidy directly. What it does do is make sure that a company in the United States buys the grain from the farmer at a particular price and sells it

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to another country, say Algeria. Then the farmers get some subsidization at the price that they get but the company that sells the grain then can add as much as the total price of the grain initially.

The lowest they have sold grain as far as I know, and it may have gone lower, was a couple of years ago. Under the export enhancement program United States companies sold to Norway a number of tonnes of wheat for $52 a tonne. Nobody in the United States or Canada could possibly raise wheat at $52 a tonne. What the Norwegians paid was $52 a tonne, but what the company got after paying the farmer was probably another $50 a tonne.

Therefore the companies made their money anyway. It did not matter to the corporation that was selling the grain into the Norwegian market that this price was lower than the possible production of the grain. It did not matter to the U.S. corporation or the U.S. that in the process they were undercutting the EEC market which I guess was its intention in the first place. It was also affecting the Norwegian market in such a way that it was almost worthless to try to grow wheat. Surprisingly, Norway grows a considerable amount of cereal grains.

The farmer finds himself competing against an almost limitless U.S. treasury. There is no way that the Canadian farmer or the Canadian government can fight the almost unlimited funds available to the U.S. treasury. Not only are the funds seemingly unlimited, but it does not bother the Americans at all to go deeply into debt.

The United States has had deficit situations for many years and it continues to do so. A good portion of that deficit has been its expenditures on export enhancement. Therefore the farmers are affected directly by legislation which the United States has in place.

We can shout as much as we want about this export enhancement being unfair and we have. We have shouted about it. We have told them that it is unfair, but the U.S. application of the free trade agreement is that United States law is to prevail in any conflict. The United States can point to this and say that its law says it can provide export enhancement.

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This export enhancement has led to the devastation of the cereal grain industry in Canada. It has not just led to the fact that we are having difficulty penetrating certain markets now. It has not led to the fact that in some areas of the world we are unable to celebrate at all because we cannot match the low prices that the export enhancement brings.

I would challenge any farmer to produce wheat at $120 a tonne because that is very low, but the fellow who sells it for the United States gets another $50 enhancement. He is sure to make a profit so it does not matter whether he sells it at a much lower price. He could sell it at $50 a tonne and still make some money. How has that affected the farmer directly? It has been devastating. As I have pointed out, it has affected the price of wheat which means the operation of the farm is in jeopardy.

Also, in my community probably 30 or 40 per cent of the farmers have lost their land. They are now out of farming entirely. Not myself particularly but many of the other farmers are picking up the slack. In my own case, I had a farmer who was working my land tell me the other day: "I am sorry. I can no longer afford to farm your land. You will have to farm it yourself". He was helping me out but it was costing him too much.

This is the kind of change we need to put in place. We need to be sure that we give our own country an opportunity to develop its economy even as we trade with different parts of the world.

Mr. Stan J. Hovdebo (Saskatoon -Humboldt):

Madam Speaker, it is my honour and duty to present a petition on behalf of the citizens of Saskatoon, mostly university students, who have suggested that the GST being the first federal tax ever applied to books, magazines and newspapers, is affecting the reading at their level, and particularly university students.

Since the Prime Minister promised in October 1990 to review the effects of the GST on reading materials after one year, they call upon this Parliament to immediately eliminate tax on reading material.

Mr. Stan J. Hovdebo (Saskatoon-Humboldt):

Mr. Speaker, I cannot find much in my colleague's remarks to disagree with. I particularly appreciate the tone he is putting on his remarks.

I want to ask a question with a little variation from those remarks. After nine budgets, a series of nine projections about what was going to happen and nine projections which were proved wrong, does my colleague feel comfortable with the projections being made in this

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particular budget in relation to where we are going and what has to be done or what is going to be done?

We have had nine budgets where the deficit was going to be cut. We were going to deal with the debt back in 1984. We were going to solve it in four years back in 1988. We were going to solve it in a couple of years. It is nine years later and we still have not solved it.

Does this member feel comfortable with the projections that were put into this last budget?