Mr. W. A. HALL (South Bruce):
Speaker, may I be permitted to congratulate the Minister of Finance (Mr. Robb), not so much on the splendid financial statement he has presented, but upon his courage and good sense in taking advantage of the circumstances that made it possible? Doubtless this is the best budget since the Fielding budget of 1897. Its good effects will be felt by people of all conditions, especially the working classes. The circumstances that made this budget possible constitute the greatest achievement of the King government. According to the press of both political parties the Robb budget is being well received by all the people in this country, except by two cities where motor
cars are assembled, or perhaps I should say where motor cars are manufactured in part. However, Henry Ford, of the Ford plant, has declared himself in favour of a reduction, not only of 15 per cent, but of 35 per cent in the duty on automobiles, in other words, in favour of free trade. This may be accounted for by the fact that the Ford plant has passed the-stage of infancy and does not require further nursing. Let me remark here that it would! be a Godsend if we had more Fords in Canada.
The Robb budget presents six things-three-reductions and three increases. Reductions, first in taxation, both direct and indirect; secondly, reductions in expenditure; thirdly, reductions in the national debt. It presents increases, first in trade and commerce; secondly, in reveune; and thirdly, an increase-in the surplus.
Direct taxation has been reduced in four different ways: First, by removing the sales
tax on many articles; second, by wiping out the receipt stamp; third, by adopting two-cent postage instead of three-cent, and fourth, by lowering the income tax. These adjustments in the income tax have been so welt -planned that the greatest relief will come to the most numerous class of our income tax payers. It will bring relief to the people of small incomes, and will doubtless produce widespread benefits. The reduction in the income tax will doubtless not affect national revenue very much, as there will be more money available for production. This has been the experience of the United States and also Great Britain.
Coming to the increases, first, the trade of Canada has been increasing during the last eight years by leaps and bounds. Canada ranks second among exporting nations of the world on a per capita basis, and stands fourth among the world traders in foreign markets. The total trade for the fiscal year ended' March 31, last including exports and imports was 82,258,534,453. The increase in exports from last year was $249,000,000, and the increase in imports $130,000,000. The favourable balance of exports over imports during the year amounted to $402,695,000, as compared with a favourable balance of trade of $29,000,000, during the last year of the Meighen government. Our import trade accounts for about ninety per cent of the increase in the balance of trade which shows the value of trade treaties within the empire.
Now let me deal wdth the question of expenditure. The expenditure has been reduced in five different w^ays: First, by practising rigid economy in the different departments of the government; second, by lessening the number
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of civil servants; third, by lessening interest in the refunding of debts; fourth, by lessening the deficit of the Canadian National Railways; fifth, by lessening the deficit of the Canadian Government Merchant Marine. The total expenditure last year was 1342,890,000, or $120,000,000 less than the total expenditure for the last year of the Meighen government. The national debt was reduced from $2,417,437,685 to $2,395,084,685, by applying the surplus or excess of revenue over expenditure to reduce it. The revenue for the last fiscal year was $376,000,000 as compared with a revenue for the previous year of $346,000,000, showing an increase of $30,000,000. The surplus of revenue over expenditure was more than $22,000,000 or an increase in surplus over last year of almost $22,000,000. The deficit on the Canadian National Railways amounted this year to $38,800,000. This represents interest to the public amounting to S7,400,000 and interest to the country amounting to $31,400,000 on money loaned to the railways by the government. The deficit on the Canadian Government Merchant Marine last year was $668,000. This shows a great improvement as compared with the deficit in the last year of the Meighen government which was over $9,000,000.
The Liberal party stands for a downward revision of the tariff, while the Conservative party calls for an upward revision. But there are insuperable obstacles in the way of too great reductions, chief among which are financial obligations. The Conservative party argues for stability of the tariff, while at the same time it talks of building a tariff wall brick by brick equal to the United States tariff, necessitating change and thus instability. The United States during the last quarter of a century has had the Wilson tariff, the McKinley tariff, the Dingley tariff, the Underwood tariff, and the Fordney-MoCumber tariff. In Canada we have had the National Policy, the Fielding tariff, the White tariff, and the Robb tariff, the last the best of all. Thus we see that in neither Canada nor the United States has there been any great stability, but rather stability by change. A gradual reduction in the tariff should be our aim.
Let me remark here that a tariff for revenue and for protection is somewhat of a contradiction. This double function cannot operate at the same time. If our industries have to be protected the tariff must keep goods out of the country. If revenue is the aim of a tariff goods must be brought in. Goods cannot be brought in and kept out at the same time. Tariff revision downward is all important. The limit to this is adequate revenue. The future prosperity, solidarity and stability
of our country depends on increase of our exports and imports. The only way to carry on foreign commerce is to import and to sell exports in exchange for imports. We need to export $200,000,000 worth of produce yearly to pay our foreign liabilities, namely, the interest on borrowed money. This is the only way we can pay that interest. These exports are derived largely from agriculture and allied interests. The products of the farm, the products of the forest, the products of the mines, the fisheries and so forth must pay the greater part of our external liabilities. We must be able to meet our financial liabilities as a nation. Consequently we must not place any unnecessary obstacles in the way of trade -no high tax on instruments of production, no unjust tax on capital, and no high tariff wall to obstruct trade and international commerce.
Just as expenditure of the individual should be within the limits of his income, so should the expenditure of the government be within the limits of the revenue. But what is fat better is to have a large surplus, as the King government had for the fiscal year ended March 31, 1926. Doubtless this government has made long strides along the road of public economy. This, Cobden described as public virtue. While lavish expenditure is a terrible public evil carying in its train many others, the only solution is individual and national economy. The estimates presented for this year show a very great reduction in expenditure, $120,000,000, from that of the last year of the Meighen government, 1921-22.
Then to return to the tariff again, may I ask what is a sound and sane and sensible and safe tariff policy for Canada? To whom shall we go for such a policy? Not to the Conservative party. We all know that the historic policy of the Conservative party is a policy of protection-protection for protection's sake-to enrich the few who are protected, at the expense of the many who are not. But the right hon. leader of the opposition endeavours to meet this in a rather sly way by promising to place a high duty on the products of the latter class. Is this not another blind intended to deceive? Although many good citizens believe this to be a sound policy, yet many more, just as good citizens, pin their faith to a moderate tariff-a tariff only for adequate revenue. This is the policy of the present government. However, I am of the opinion, if we are to get a sound and sane tariff policy we shall have to turn back to the policy of the Liberal party in 1911. That is the tariff as it then was with the amendments that were contemi976
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plated by the government when it went out of power. In this there is the framework of a sound and sane tariff policy. However, with changing conditions, variations must be made to suit the changed conditions.
The hon. member for South Wellington (Mr. Guthrie) said that the policy of the Liberals from 1897 to 1911, was the national policy of the Conservatives from 1879 to 1896. This is not so. If the hon. member will read his own speech, as recorded at page 1705 of Hansard of 1901, I think he will be convinced that this is not the case. In that speech he charges the Conservatives with inconsistency. He reminds them that they said that the policy of the Liberals at the revision of the tariff in 1907, had torn down and destroyed the National Policy, and then afterwards, when things changed, he says they turned to a sane and sound policy. If you will turn to the records of that time you will find that the Tory leaders as well as the Tory press denounced the Liberal policy of 1897. They said that the Liberals had torn down and destroyed the National Policy. But as the years passed and the country prospered and developed the Tories swung around and claimed the policy to be theirs, namely: to be the National Policy. In the same manner the hon. member claims that the right hon. leader of the opposition is the father of the Canadian National Railways, having unified and consolidated the different railway systems. But what is the truth? The Meighen government passed the Railway Act to take over the different systems, but the unification consolidation and co-operation of the different systems was left to the King government to accomplish. This government placed the Canadian National Railways under one board of directors with one president and general manager, Sir Henry Thornton,, instead of under four or five boards with as many presidents and managers. We all know the results produced by this policy.
But to return to the Liberal policy of 1897; proof that it was not the National Policy of the Tories is afforded by taking the facts and figures of the period from 1897 to 1911. Take the actual savings in custom duties, and the savings that were made by the reduction in the prices of home manufacturers. You will find the changes made represented hundreds of millions of dollars in the pockets of the people of Canada. Then how could it be the old National Policy? It was the policy which made this country grow and prosper as it never had before. During this period, there was the greatest development, the greatest prosperity,
and the greatest increase of population- amounting to 34.17 per cent-that had ever taken place in Canadian history. There was added to the population almost two and a quarter millions. This was Liberal rule under Laurier, with a tariff for adequate revenue. But the period from 1879 to 1896 was characterized by depression, by lack of development, by lack of prosperity, by a very small increase of population, amounting to only 11.44 per cent, the smallest of any like period in the history of Canada. Mark you, this was Tory rule with a high protective fiscal policy. They called it the National Policy. Indeed, several of the then leading Conservatives confessed in the House of Commons that high protection had not accomplished what it was intended to do,-in other words, it had failed.
But in the early part of this period of Tory rule, their leaders as well as the Tory press claimed that the National Policy would cause industries to flourish, would give employment to everyone, would retain in Canada her own people and would increase her population greatly. What happened? From 1884 to 1891 there came to Canada 886,00(0 immigrants. Out of this number only 36,000 remained in Canada as shown by the census containing the number of foreigners born in Canada.
Now, Mr. Speaker, permit me to read some extracts from Hansard bearing on this matter. In 1892, Hon. T. M. Daly, Minister of the Interior, in the Tory government, said:
I do not believe that our fiscal policy has anything to do with our people going to the other side of the line. As the census showed that the National Policy had not accomplished its objects.
Mr. Daly declared that the National Policy had nothing to do with the emigration. In the same year, Mr. R. Armstrong, president of the Young Conservative Association of Toronto, said:
The question as to why thousands are leaving this country every year and going to the United States, should engage our serious attention, for it is quite evident that the older heads are not going to do so.
I am informed that no fewer than 6,000 persons have left this city during the past year-left all that is near and dear-and gone into foreign exile. In short, there is no concealing the fact that we are being annexed in job lots every week and there is not a voice raised against it.
In the same city, Mr. J. H. McGhie, afterwards one of the members for Toronto, said:
The men who were spangled with knighthood, sit talking of loyalty in the midst of ruin and desolation. It was from the young men, that they must expect a new order of things.
Now' judging from these statements and facts, a few out of many that might be cited, those were very dark days for Canada,-
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manufacturers making no headway, unemployment, emigration almost keeping pace with immigration, Canadian-born drifting by thousands across the line, farmers quitting the land, skilled workmen leaving for the country south of us and unsatisfactory conditions generally due to industrial depression. This is another case of promises made to the people of this country-promises that could not be fulfilled. The National Policy of the Tory party was to be a panacea for all ills. But it utterly failed. Consequently, the Tory party with its policy became discredited, was defeated at the polls in 1898 and was succeeded by the Liberal government which had a real fiscal policy.
One of the first things to engage the attention of this new government was tariff reform. In 1897 a thorough revision of the tariff took place when forty-seven different articles were added to the free list and duties reduced on 147 o|hers including farm implements. In addition a substantial preference over the rest of the world was given to the products and manufactures of Great Britain. Sir Charles Tupper, and his party due, I suppose to their super-loyalty, bitterly opposed the British preference as well as the whole revision of the tariff. Sir Charles surprised the House by his historic attacks found in Hansard, volume I, page 1291, year 1897. He said in part:
The result is that this tariff goes into operation and the hon. gentleman knows that the industries of this country are already paralyzed, while hon. members gloat over the destruction of Canadian industries. I was reading the wail, the sorrowful wail of these industries in the Montreal Gazette, where one manufacturer after another declared that these industries were ruined, that their mills must close, and that they saw staring them in the face, a return of the deplorable state of things that existed when the hon. gentleman who last addressed the House was in charge of the fiscal policy of this country. I say that a deeper wrong was never inflicted upon Canada.
I ask, where was his super-loyalty? The Tory cry was, as it is to-day, preference for preference, Canada first. This makes one think of the present leader of the Conservative party in his pre-election speeches last year when he repeated Sir Charles Tupper's words: "preference for preference, Canada first." Thinking like this, made it easier for him to make his famous Hamilton speech.
The concessions given to the farmers of free binder twine, barbed wire, other fencing wire, Indian corn, cream separators, and so on, were denounced by the Tories on the score that they would result in the wiping out of these industries in Canada. But what happened? These industries continued to flourish as never before. The Robb tariff will have a similar effect on the automobile 14011-189
industry. Although binder twine and the other products mentioned are on the free list still as far as I am aware, and although these gentlemen declare that the British preference and the tariff changes would seriously injure our manufacturers, the contrary has proved to be the case. Mr. Speaker, will you allow a few more extracts from Hansard? On different occasions the Tories moved in the House the following resolutions:
Moved, that the House, regarding the operation of the present tariff as unsatisfactory, is of opinion that this country requires a declared policy of such adequate protection to its labour, agricultural production, manufacturers and industries as will at all times secure the Canadian market for Canadians.
Speaking on this resolution, Mr. Rufus Pope, Conservative member, said:
The resolution that I would have preferred would be a resolution for a Chinese wall all round.
Mr. Blain, member for Peel, during the same session-1902-said as reported in Hansard of that year, page 1499:
I hold that the tariff should be so arranged that every institution in this country which is manufacturing goods to be consumed by the Canadian people, should have sufficient protection to keep out the same class of goods made in any foreign country; and I have no hesitation in saying that if that country should be England, the policy of Canada should be framed in the interests of the Canadian taxpayer as against the people who are producing the same class of goods even in the Old Country under the same flag.
Mr. Henderson, Conservative member for Halton said, during the same session:
It was said in the early days of the present tariff that the Liberals had stolen our clothes. I have never said so, and I do not consider that they have done anything of the kind. I am only sorry that they did not, for it would have been better for the country if they had. Their tariff is instead just the antithesis of ours.
That is what Mr. Henderson states in regard to the Liberal tariff as compared with the Tory tariff. He says that one is the antithesis of the other. These quotations amply show that the Tories regarded this as a new fiscal policy. Indeed, they claimed that the Liberal policy would paralyse the industries of the country. They hoped and prayed for this, but their expectations were doomed to disappointment. On the other hand the Liberals claimed that this new policy would benefit the industries instead of injuring them, just as they claim that the Robb tariff will help the automobile and allied industries on account of increased sales rather than hurt them. Indeed, I challenge anyone to point out a single industry ruined by similar changes in the tariff. On the contrary, all modifications of this kind have invariably produced beneficial results to the industries affected.
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In this instance, as in all others, time proved the Tories wrong and the Liberals right. There followed a great revival of business, trade and commerce improved and even manufacturers flourished as never before. After this the Tories swung around and said that the Liberals had made no material changes in the tariff; that their so-called National Policy was still in force, and that the Liberals were wearing their clothes. Is this not what the Conservative party now claims? But the people had not forgotten what the Tory leaders as well as the Tory press had said and done when the Fielding tariff was enacted.
Perhaps the most outstanding feature of the new tariff was the British preference. Its results have been highly beneficial alike to Canada, Great Britain and the empire. This preference at first was a reduction of one-eighth, later one-fourth and still later one-third of the general tariff. As I said before, the Conservatives strongly opposed this preference; they spoke of it as a myth, a sham, a fraud on the British people, a danger and menace to manufacturing industries, the thin end of the wedge to destroy protection in Canada.
The leader of the opposition (Mr. Meighen) referred to this preference in his speech at Kitchener last October in the following words: I would give a preference to the people of Great Britain, Australia, New Zealand, any people within our empire, but on this condition that they give us a preference in return, until then it is no duty of Canada to continue the preference.
Now, Mr. Speaker, what does the leader of the opposition mean by this statement? If he were leader of the government would he terminate this preference? That seems to be the logical conclusion. The Conservative party is certainly true to its name; the same yesterday, to-day and forever. The very language of Sir Charles Tupper is employed by the present leader of the opposition, namely: preference for preference. Let me say here, that the Hamilton incident is in keeping with this occasion at Kitchener. On both occasions, what a manifestation of superloyalty! By the way, further proof of Tory super-loyalty in Lord Elgin's time was shown by the burning of the parliament buildings in 1849, by pelting the Governor General with malodorous eggs, and by other manifestations of hostility.
We also heard during the campaign last autumn a great deal about the decrease of immigration and the increase of emigration. The opposition in the House as well as the Tory press still continue the mournful, doleful wail. May not this account for the great
increase in the favourable balance of trade- the large export of exaggeratedly pessimistic news? The leaders and press of the Tory party have indulged in this trade, apparently with a certain morbid satisfaction. This tendency has been altogether too general among responsible persons in the Tory party. Their dismal prophecies, loud wails, though not taken too seriously at home, cannot fail to be believed by the people of other countries, and thus produce incalculable injury to Canada. The Robb budget, however, should dispel any such lurid and unwarranted impressions in Canada.
We are ready to admit that since the Great war immigration has slackened and emigration has been more active. There are many reasons for both, which we all know. But I am glad to say that the grounds for these reasons are gradually passing away and conditions are already fast improving. But my Conservative friends claim to have one sure remedy: "protection for all industries"-their cure-all nostrum. Why, Mr. Speaker, it reminds one of a patent medicine advertisement. What are its claims? It would beckon the exiles back to their homes. It would call home the sons and daughters who have gone. It would give work to those who are here. It would bring immigrants from other lands and so forth. But will this remedy do all these things? No more than any patent medicine will cure all diseases. Why, Sir, this is an old remedy, tested and found worthless, tried by the Tory party for nearly twenty years. The experience they had with it was that the longer it was used the worse conditions became, especially during the five or six years from 1891 to 1896. These were the darkest days of Canada.
The population of Canada was practically at a standstill outside of Quebec. The population in the Maritime provinces actually diminished. Ontario's population increased in these five years only about one per cent. Most of the few immigrants that came to Ontario soon found their way into the United States. The results of the Conservatives' efforts during this time to populate the west was described by a western Tory paper in the following graphic language:
The trails from Manitoba to the states were worn, bare and brown by the wagon wheels of departing settlers.
During this period between 1891 and 1896, about 100,000 immigrants were brought into-Canada at a great cost, most of whom crossed the line later into the United States. Indeed, we could not keep our own people. The United States census of 1900 showed that over
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1,000,000 of the population of that country had been born in Canada. Is it any wonder then that the people of Canada discarded this once much lauded nostrum of "High Protection" and voted a change of government in 1896, thus securing for themselves a worthwhile remedy-Liberal rule?
Then followed the golden era of prosperity and contentment under Laurier, the brightest and most glorious period in Canadian history. In conclusion, let me say that the Robb budget augurs well for a repetition of similar conditions in Canada under the King government.
Topic: THE BUDGET
Subtopic: CONTINUATION OF DEBATE ON THE ANNUAL