1901-03-14

[Stage Direction]
Bill (No. 07) to incorporate the Quebec
Terminal and Railway Company.-Mr. Ma-louin.

[Stage Direction]
P.E.I.-AGRICULTURE, FORESTRY, ETC. Mr. HACKETT asked :
1.	Who recommended a Mr. Kinsman as a scientific horticulturist to work in Prince Edward Island during the summer of 1899 ?
2.	What amount did his mission cost ?
3.	Was the minister satisfied with the result of his work ?
|	4. What is the government doing in order to
secure steamships with proper cold storage for
[Stage Direction]
Prince Edward Island exports to Great Britain the coining season ?
5.	Has the government any special plan for the aiding of agriculture in Prince Edward Island this year ? If so, what ? If not, why not ?
6.	Has the government decided to do anything to prevent the impending loss of our forests cr to arrange for restoration in sections already almost denuded of woods ? If so, what ? If not, why not before it is too late ?

[Stage Direction]
Mr. McGOWAN-by Mr. Taylor-asked :
1.	What was the date of the appointment of Miss Schneider as postmistress of the village of Drayton, Centre Wellington?
2.	What was the date of Miss Schneider's dismissal ?
3.	What were the reasons for such dismissal ?
4.	Were any complaints made to the department as to Miss Schneider's management of said post office ? If so, was any investigation held as to such complaints ?
Hon. JAMES SUTHERLAND :: 1.	Miss M. E. Schneider was appointed to the postmastership of Drayton, county Wellington, C.R., on the 30th June, 1896.
2.	Miss Schneider was removed from the postmastership of Drayton on the 13th October, 1898.
3	& 4. It was deemed in the public interest that the change should be made, and the Postmaster General accepts full responsibility therefor.


MAIL CLERKS IN SOUTH AFRICA.
Mr. LAYERGNE asked :: Whether it is the intention of the government to reward Messrs. T. B. Beddell, of New Brunswick, K. H. Murray and Captain W. R. Ecclestone, of the province of Ontario, Joseph Lellier, of the province of Quebec, and Rowan Johnston, of the province of Manitoba,-all five of them mail clerks, who served in South Africa, as forming part of the Canadian postal service for the several Canadian contingents, by promoting them to first-class positions in the civil service?


Hon. JAMES SUTHERLAND.: The matter has not yet received the consideration of the government.


Mr. HACKETT.: 


DUNDAS RIFLE ASSOCIATION.
Mr. SMITH (Wentworth) asked :: Why has the annual grant to the Dundas Rifle Association, for which appropriation was made, not yet been paid, though heretofore usually paid in September or October ? When may the association expect it ?


The MINISTER OF MILITIA AND DEFENCE (Hon. F. W. Borden).: There is no association known as the Dundas Rifle Association in receipt of an annual grant from this department.
If the 77th Regiment Rifle Association is meant, this association was paid its annual grant last year.


CONTRACT WITH THE B. C. EXPRESS CO.
Mr. PRIOR asked :: 1.	What is the present contract price per annum paid to the British Columbia Express Company for carrying the mails from Ashcroft to the several places in Cariboo District ?
2.	What mail routes does this contract cover, and how many trips per week are called for on each route ?
3.	Had the previous contract expired by effluxion of time when the present contract was made ?
4.	On what date was the present contract signed, and for how many years was it ?
5.	For what reason was the contract renewed on October 1, 1899 ?
6.	Were public tenders called for, or were any parties asked to tender other than the British Columbia Express Company ? If so, who ?
7.	If not, why not ?


Hon. JAMES SUTHERLAND :: 1.	$23,250 a year.
2.	Between Ashcroft and Barkerville-287 miles-semi-weekly from 15th May to 31st October, weekly for the remainder of the year.
Between Ashcroft Station and Clinton- 32 miles-semi-weekly from 1st November to 14th May, weekly for remainder of the year.
Between Ashcroft and Lillooet-63 miles- weekly throughout the year.
Between Alkali Lake and Clinton-90 miles-weekly throughout the year.
Between 150-Mile House and Horsefly-40 miles-weekly throughout the year.
Between 150-Mile House and Keithley Creek-80 miles-weekly throughout the year.
Between Soda Creek and Alexis Creek-90 miles-weekly throughout the year.
3.	No.
4.	The contract was signed by the British Columbia Express Company on the 9th October, 1899.
5.	Because the department had secured contractors who were performing the work in a satisfactory manner and at a reasonable rate, the amount previously paid being $27,445. and as they were willing to continue the service on the same terms and conditions, it was thought to be in the interest of the service, as prices were get-
ting higher, to continue the contract with the same contractors.
6 & 7. Public tenders were called for in 1897, and the present contract is a renewal of the one made on the 1st July of that year.


MADOC MAIL SERVICE.
Mr. CARSCALLEN asked :: 1.	Who is the contractor for carrying the mails from Madoc village to Central Ontario Railway station at Eldorado ?
2.	When was the contract entered into, and for what length of time?
3.	What amount is paid for the service ?
4.	Were tenders advertised for, and for how long were such advertisements posted ?
5.	Were any tenders received, and the amount of tenders, if any ?
6.	Did the lowest tender receive the contract ?


James Sutherland: The service is performed by Mr. Joseph Vassau under a temporary agreement entered into on the 1st July, 1900. Mr. Vassau's contract expired on the 30th June, 1900, and it was proposed to put the service up to tender, but it was represented to the Postmaster General that the Eldorado Railway would be reopened within a short time, and that it would be better to postpone the making of a new four years' contract until the question of utilizing the railway for the conveyance of mails could be considered ; and the service has been performed since that time on the terms and conditions of the former contract.
The service is semi-daily, distance 7 miles, and the rate of pay $400 a year. The inspector in reporting on the service stated that the rate of pay was reasonable, and that the service had been satisfactorily performed.


WAYS AND, MEANS-THE BUDGET.
[Stage Direction]
The MINISTER OF FINANCE (Hon. W. S. Fielding) moved that the House resolve itself into Committee of the Whole to consider of the Ways and Means for raising the Supply to be granted to His Majesty.
He said : Mr. Speaker, for several years in succession, on occasions similar to this, I have had the good fortune to be able to congratulate the House and the country upon periods of great and steadily increasing prosperity. I rejoice to know that I am at liberty to make a similar statement to-day with respect to the affairs of Canada for the past year. In almost every department of industry in which the Canadian people are engaged there was a gratifying activity, and trade, commerce and manufactures flourished. Here and there, as may always be expected in a country of such vast extent and varied interests as prevail in Canada, some local condition was unfavourable, some drawback may have occurred. But in summing up the affairs of the country, we are able to describe the year as 46
one of unexampled prosperity. Prosperity in trade and manufactures has brought prosperity to our national finances, and enabled me at the close of the year to announce results which it is not too much to say formed the most satisfactory financial statement that ever fell to the lot of a Minister of Finance to make in the Dominion of Canada. At a time of very considerable financial stringency, at a time, too, when our expenditures were being conducted on a very liberal scale, we found our revenues so generous that we were able to provide for all our needs without having resort to fresh loans, or even to an issue of treasury bills.
A glance at the receipts and expenditures in comparison with the previous year will show that there was a general increase all along the line. I have the honour to present this statement:
1898-9.	1899-1900. Increase.
Customs	$25,316,841	28,374,147	3,057,306Excise	
9,641,227	9,868,075	226,848Post office	
3,193,777	3,205,535	11,758
Miscellaneous ....: 8,589,404	9,582,237	992,833

It may be remembered that in speaking of the prospects of the year in the budget speech of last March, I expressed the opinion that the receipts for the year would pass the $50,000,000 mark ; the figures I have just given will show that that anticipation was realized, the receipts of the year having been over $51,000,000. The chief increase, as may be readily understood, was in customs. That increase, to some extent, was due to the increased imports, and to some extent, no doubt, to the higher values which prevailed. We have increases in the post office which are very gratifying. Of course it is well known that a year or two ago the post office revenues fell off-not a matter of regret altogether, because we know that that falling off was caused by the very important reform brought about by my hon. colleague the Postmaster General, who is now absent, wherein he established a two-cent rate instead of a three-cent rate, one of the most important reforms in the Post Office Department, and one which I am sure the country has fully appreciated.
If, for a time, therefore, our revenue from that source fell off it would not be altogether a cause for regret. I am glad to be able to say that we have now reached the point where we shall be able to make comparisons with previous years under the three-cent rate. In January last past, we had turned the corner in that respect. Up to that date, our revenue was, under the two-cent rate not quite so large as it was under the three-cent rate ; but, in January, 1901, under the tw<o-eenit rate, the revenue of the Post Office Department was $398,289, while in the corresponding month of



January. 1898, under the three-cent rate the revenue was $3(58,941, showing that now, under the two-ceut rate we are receiving more money in the way of revenue in [ne l ost Office Department than we formerly received when the three-cent rate prevailed. Under the head of miscellaneous revenues there is a considerable increase, the largest item being in respect to railways. There is an increase of $828,344 under that head. It is well to remember that, while we are spending largely increased sums upon the Intercolonial Railway in particular, we are also having largely increased receipts, and it may be well in this case to make a comparison between 189G and 1900. The revenue of the Intercolonial Railway in 1896, being the year ending the 30th June, was $2,937,640. The revenue for last year was $4,552,071, showing an Increase in the receipts of the Intercolonial Railway between 1890 and 1900 of $1,594,431. My hon. friend the Minister of Railways and Canals (Mr. Blair) has to come to the House frequently for increased appropriations for this road, and it is well that when he shall do so we shall keep these facts in mind, and realize that owing to the greater development of the Intercolonial Railway, and of the trade of the country generally, the receipts of that important public work are now much larger than they were before. Our total revenue for the year which has passed was $51,029,994.02. Our total expenditure, chargeable to consolidated fund account, that is our total expenditure for what may be described as the ordinary purposes of government, was $42,975,279.51. showing a surplus on the year's operations of no less a sum than $8,054,714.51. This surplus, Mr. Speaker, was the largest that has ever been known in the history of the Dominion of Canada.
I have prepared a statement showing the surpluses and deficits for the last four years, and the following are the figures :
In 1897 there was a deficit of $519,981.44, in 1898 there was a surplus of $1,722,712.33, in 1899 there was a surplus of $4,837,749, and in 1900 there was the surplus that I have just mentioned of $8,054,714.51. Our surpluses thus have aggregated $14,015,175.84. Deduct $519,981.44, the deficit for the first year, which was, however, hardly under our control, but we will pass that point now,-deduct the deficit of that year from the surpluses of succeeding years, and we find that there has been a net surplus for the four years as between the revenue and the ordinary expenses of government of $14,095,194.40. So far I have dealt with what we call the expenditure on consolidated fund account, which represents the ordinary expenses of government. There is. of course, another class of expenditure which figures in our account, which is commonly called capital expenditure, ineluding public works, railways, railway subsidies and various special items of an , Mr. FTET,DWG.
unusual character. These expenditures for the year ended June 30, 1900, were as follows :-
Intercolonial and Prince Edward
Island Railways	
$3,308,894	31Canals	
2,639,564	93Public works	
1,089,827	29Dominion lands	
199,470	09Militia	
230,850	51Canadian Pacific Railway	
236	11Total	
$7,468,843 24
To this must be added for railway subsidies, including $340,000 paid during that year to the Crow's Nest Pass Railway, $725,720.35, and there is a further item to be added, being the expenses of the South African contingent and the Halifax garrison, amounting to $1,547,023.74. These capital and special expenses for the year amounted to $9,742,187.33. Now, with these large expenditures for the liberal maintenance of the public services, with large expenditures for railways and public works, and with special expenditures in connection with the South African war, it would not have been a matter of surprise if it had been necessary to increase the public debt. Yet, we have the gratifying statement that we have provided for all these large expenditures, and that we have been able not to increase the public debt, but actually to reduce the public debt to the extent of $779,639.71. The net debt on June 30, 1899, was $266,273,440.60 ; the net debt at the same date in 1900 was $265,493,806.89, showing a decrease of $779,639.71, as already stated.
Now, that is a very gratifying statement, but it is one which it is only possible to make in very prosperous times. In only two years prior to this, in the history of the Dominion of Canada, was the Finance Minister able to make the statement that there had been a reduction in the public debt. This occurred in the year 1871, when my predecessor in office was Sir Francis Hincks. and it also occurred in 1882, when Sir Leonard Tilley was Minister of Finance, and when there was a reduction in the public debt of a very considerable sum. It is not therefore reasonable to expect that this reduction in the public debt can frequently occur. In a country like Canada, which after all is a comparatively new country in which there will always be demands for public works, and in which there will be expenditures outside of what may be called the ordinary expenses of government, it is only reasonable to suppose that we shall incur obligations which will necessitate occasionally some addition to the public debt. I think that if the addition to the public debt should only be a moderate one we will have no reason to complain.
Turning now to the affairs of the current year, which is to close on the 30th June next, I find that our revenue up to the
10th March was $34,942,177.95, an increase over the corresponding date last year of $1,227,693.01.
The customs revenue, which is always an item of chief importance, remains up to date substantially the same as it Was a year ago, and I do not expect that from this time forward we can expect any material increase in that item. In railways and post office and excise there has been a considerable increase, and we anticipate that there will be some further increase before the year closes.


Mr. WALLACE.: How much increase in the excise ?


The MINISTER OF FINANCE.: I have not the figures at hand, but I will give them to the hon. gentleman later. I estimate that the total revenue for the current year, to end on June 30 next, will be $52,750,000, or an increase of $1,720,000 over the revenue of the previous year.
Coming now to the expenditure account for the current year. The expenditure up to March 10, on consolidated fund, was $27,731,602.04, so that, if we had an increased revenue, we have also had some increase in expenditure as well. We have some supplementary estimates yet to bring down for the current year which will, of course, swell our existing appropriations. I estimate that when the year's affairs are closed, including these supplementary appropriations, we shall find the expenditure chargeable to consolidated fund amounting as near as may be to $46,400,000. With an estimated revenue of $52,750,000, and a probable expenditure of $46,400,000, I reach the conclusion that at the close of the present year we shall be able to show another surplus amounting to $6,350,000.


Some hon. MEMBERS: Hear, hear.


The MINISTER OF FINANCE.: This, Sir, is not so large a surplus as that of the past year, but I think we shall all agree that if the accounts when closed will show a surplus as large as that, it may be regarded as very satisfactory.
The capital expenditure of the current year, to March 10, was $6,584,309.42. We have still to pay very considerable sums on account of railway subsidies, canals, and so forth, and I estimate that the total expenditure chargeable to capital for the current year will reach $10,700,000. If we deduct from this our surplus and our sinking fund, I am of opinion that we shall have to make some addition to our public debt, but I think it will be a very moderate one, and will not exceed $1,800,000. That is not a very large sum, especially if we take into consideration the additions to the public debt in days gone by. Our administration is four years old, and as one naturally wishes to prepare a statement concerning the period of his own government, I have prepared a 461
statement of the state of the debt in these four years.
Debt statement for four years.
Increase. Decrease.
1896-	7	
$3,041,1631897-	8	
2,417,8021898-	9	
2,317,0471899- 1900	
$779,639

Total increase in four years.. $6,996,373 Average increase for four
years	 1,749,093
Average increase for 18 years,
1878-1896	 6,563,075
Therefore, deducting the decrease, we find that in the four years we have increased the public debt to the extent of $6,996,373. The average increase for the four years is therefore $1,749,093 per annum, against an average increase in the previous eighteen years of $6,563,075 per annum.	.
With regard to the next fiscal year, beginning on 1st July next, it is too soon for us to attempt to make anything like a close estimate. I have already submitted to parliament estimates on account of consolidated fund amounting to $44,102,323.56, and on capital account amounting to $6,296,500, making a total of $50,398,823.56, including both capital and consolidated fund. We have supplementary estimates yet to come which must considerably add to these appropriations, and there are special expenditures likely to come upon us in the next year of which we must take note. We shall have to provide, in addition to considerable expenditures in the usual way on railway subsidies and so forth, for a very considerable sum in the shape of bounties on iron and steel. Hitherto these bounties have not in any one year amounted to any very great sum, but hon. gentlemen are well aware from what we have seen in the public press as well as from the discussions in this House, that the iron and steel industry is now being developed on a very large scale and as a consequence of that we shall be called upon to pay a very considerable sum as bounty. It is difficult to form any definite opinion as to what this will amount to. We know the amount of bounty that is to be paid per ton, but the quantity that will be produced is of course a matter concerning which we have no means of knowing definitely. I assume, however, that we shall have to pay next year at least $1,000,000 in bounties on iron and steel, and I shall not be surprised if the sum has to be somewhat larger. Therefore, we shall be obliged to provide for a very considerable expenditure for the coming year. As to revenue, I do not expect that we can keep on at the rate of increase which has been so marked during the past three or four years. I think we have probably now reached about the

crest of tlie wave of prosperity. I do not expect that we shall have any serious reverses. I think the business of Canada has been developed during the past four or live years upon very safe and sound lines. I think there has been to a very large extent an absence of that inflation which is so apt to mark a period of good times. I am of opinion that the business of the country as a whole has been so carefully conducted and is on such a sound basis that we are not likely to suffer any serious reverses, but 1 do not think it is reasonable to expect that we can go on increasing our business as rapidly as we have during the past few years. What may happen is that we might suffer a check. Perhaps it might be best described as a period of rest, not of going backward, when Canada like a young giant will gather new strength and advance again by leaps and bounds as she has during the past four years. Perhaps, 1 will be pardoned if I give somewhat hurriedly a few oT the leading facts which mark the great prosperity of the past year. These facts can, of course, be obtained by those who take the trouble to go through the Trade and Navigation Returns, but, they may be conveniently presented in a condensed form in the budget speech. It was indeed a banner year so far as the trade and commerce of the country is concerned. The aggregate foreign trade of the year 1900 was $381,517,230. In the previous year it was $321,001,213. The increase in the aggregate foreign trade of Canada over the previous year was $59,856,023. When I remind the House that the increase in the whole eighteen years of the national policy was only $66,000,000, and when I show that in one year only of the present administration, the increase was over $59,000,000 and nearly $60,000,000, lion, gentlemen will be able to measure the vast progress that has been made in trade of the country.


Mr. COCHRANE.: When you abandoned the national policy.


The MINISTER OF FINANCE.: No, our hon. friends opposite have been abandoned; we are still here. The following summary is interesting and instructive :
Aggregate foreign trade, 1900	 $381,517,236 00
"	"	1899.... 321,661,213 00
Increase In 1900	$ 59,856,023 00
Imports entered for consumption,
1900	 $180,804,316 00
Imports entered for consumption,
1899	 154,051,593 00
Increase in 1900	 $ 26,752,723 00
Exports of produce of Canada,
1900	 $170,642,369 00
Exports of produce of Canada,
1899   	 138,462,037 00
Increase in 1900	 $ 32,180,332 00


Mr. FIELDING.: Exports, the produce of Canada
to Great Britain, 1900	 $96,562,875 00
Exports, the produce of Canada to Great Britain, 1899	 85,114,555 00
Increase in 1900	 $11,448,320 00
Exports, produce of Canada to
United States, 1900	 $59,666,556 00
Exports, produce of Canada to United States, 1899	 40,426,856 00
Increase in 1900	 $19,239,700 00
Exports, Canadian Mines to all
countries, 1900	 $24,580,266 00
Exports, Canadian mines to all countries, 1899	 13,368,150 00
Increase In 1900	 $11,212,116 00
Exports, Canadian fisheries, 1900.. $11,169,083 00 "	"	1899..	9,909,662 00
Increase In 1900	 $ 1,259,421 00
Exports, Canadian forests, 1900...	$29,663,668 00
"	"	1899...	28,021,529 00
Increase in 1900	 $ 1,642,139 00
Exports, animals and their produce, the produce of Canada,
1900	 $56,148,807	OO
Exports, animals and their pro-	.
duce, the produce of Canada,
1899	 46,743,130	00
Increase in 1900	 $ 9,405,677 00
Exports, agricultural products, the
produce of Canada, 1900	 $27,516,609 00
Exports, agricultural products, the produce of Canada, 1899	 22,952,915 00
Increase in 1900	 $ 4,563,694 00
Exports, manufactures of Canada,
1900	 $14,224,287 00
Exports, manufactures of Canada,
1899	 11,706,707 00
Increase in 1900	 $ 2,517,580 00
In view of the discussions which have occasionally taken place in the House with regard to the increase of the imports from Great Britain for home consumption, I have placed together the figures for a series of years :
1895		 $31,131,737
1896		 32,979,742
1897		 29,412,188
1898		 32,500,917
1899		 37,060,123
1900	 44,789,730
It will be observed, Sir, that the imports from Great Britain had been declining steadily when the policy of the present government, including the preferential tariff, was adopted. That decline was immediately arrested, and from that time on the imports from Great Britain began to increase, so that now, as compared with 1897, they show an increase to the extent of about 50 per cent.
I confess that I hardly know just how this increase of imports may be viewed by
some of our lion, friends opposite. Sometimes the criticism is that by our preferential tariff we have allowed goods to come in from Great Britain and have thereby injured our own manufactures.


An hon. MEMBER.: Hear, hear.


The MINISTER OF FINANCE.: Hear, hear, says my hon. friend opposite. But at other times the argument is that the preferential tariff has made no difference in the trade with Great Britain, but that trade has increased generally and that the imports from' Great Britain have only kept pace with the general increase of business throughout the world ; and when we have contended, as we have, that the preferential tariff has been an instrument in increasing the imports from Great Britain, we have met the reply that it has not had that effect at all, but that the increased trade with Great Britain has come about by means altogether irrespective of the preferential tariff.


Mr. CLANCY.: Will the hon.. gentleman give the increase of imports from the United States during the same period ?


The MINISTER OF FINANCE.: No, Mr. Speaker, but if it will help my hon. friend very much, I will make an admission at once. We import from the United States a large quantity of the things we require, not to please the United States, but to please ourselves. We import the raw materials from the United States, which go to make the manufacturers of Canada prosperous. If it be the policy of our hon. friends opposite to keep out the raw materials which our manufacturers require, that is not the policy of the present government.
In this connection perhaps I may be permitted to say a word as to a contention which has been advanced at times, and which has found a suggestion this session in the form of several questions by our hon. friends opposite. The argument has been used sometimes in the public press, and sometimes on the floor of this House, that our preferential tariff is admitting a large quantity of foreign goods-goods which are not British at all. Now, that is a fair matter for investigation. It was no part of our intention to extend the benefits of the preferential tariff to these foreign nations. The intention was that goods coming from Great Britain and purporting to be British goods should be bona fide products 0f Great Britain. But, of course, we have to remember that Great Britain imports great quantities of raw materials and articles in the first process of manufacture, and improves or finishes them ; and then she is the great shipping mart for those goods throughout the wide world ; and it has been suggested by a question put by one of our hon. friends opposite that perhaps we -ought to provide that the preferential tariff
shall apply only to British goods, meaning materials which are grown or produced in Great Britain and undergo all the processes of manufacture in Great Britain. I .had to reply that such a policy would 'amount to a practical repeal of the preferential tariff, because Great Britain has to import large quantities of materials out of which she produces her manufactured goods. But it has been represented that the preferential tariff is evaded, and that goods of Belgian or German or other foreign origin are brought in under it. I want to say that if any information can be furnished by any hon. gentleman in the House or by any gentleman outside, it will help us to investigate that matter ; for we have every desire to see that the intentions of the preferential tariff in that respect are carried out in good faith. As to whether our present regulation for distinguishing between British and foreign goods is sufficient may also be a fair matter of inquiry. We think we have probably reached a sound conclusion in that respect when we have determined that 25 per cent of the value of an article being of British labour or industry shall give it the stamp of a British manufacture and entitle it to the benefits of the preferential tariff. But while we think we have probably reached a sound conclusion in that regard, I quite admit that it is a matter for investigation and inquiry : and if any information can be furnished which will lead us to believe that the intention of the government with respect to the preferential tariff is being evaded, either through fraud on the part of importers or through error in our own calculation as to the proper proportion of British labour, we shall deem it to be our duty to give the matter every consideration. I have a statement here, again taking a period of four years for convenience, showing the exports of the produce of Canada for two periods of four years each, and have classified them so that the exports of each class are shown. The statement is as follows
Statement showing Exports the Produce of Canada for four year periods.
		Four years,	Four years.
		1893 to 1896.	1897 to 1900.
Mine 				 $ 26,173,776	$ 63,710,587


Fisheries ....: 41,615,754	42,234,729
Forest 	
103,782,210	115,455,465Animals and	their	pro-	duce and agricultural	ducts 	
204,043,511	287,954,114Manufactures	
32,520,973	46,131,324Miscellaneous	
364,222	432,175Coin and bullion	and	short reported ..	
14,459,930	22,740.235


Total ...: $422,960,376	$578,658,629
			422,960,376
Increase	last	four years		$155,698,253
The question of the rate of taxation under the customs tariff has been frequently discussed, and perhaps a word or two concern-
145 L

ing it, based upon the figures of the past year, will not be out of place. If we take the imports for home consumption and the duty collected, we will find that the proportion of duty in 1896 on all imports for home, consumption was 18-28, and by the same statement for 1900, it was 15-98, making a difference of 2-30 or one-eighth of the whole duty.
If that were to be taken as a correct statement of the whole matter, it would show that the difference between the operation of our tariff on the imports of last year and that of the old tariff, were it still in operation, would have amounted to $4,161,918.
But there is a point concerning which we have occasionally had a discussion here with regard to the imports of corn, and I wish to qualify the statement 1 have just made in the light of what has happened with respect to our trade in corn. Under the old tariff corn was dutiable, and consequently it was important that the man handling it should discriminate very carefully between the corn for home consumption, which paid a duty and that in transit for exportation, which paid no duty. But when corn was made free the necessity for that careful discrimination no longer existed. There being no duty, the man who imported the corn might enter it at the customs for home consumption and export it a week later. If we take the quantity of corn exported and thus try to obtain a fair comparison with the former condition of affairs and make allowance in that way for the portion of the corn which increased the value of our imports. when in reality it was sent abroad and did not enter into home consumption- making allowance for that, we shall find that the average rate for last year was not 15 98 but 16-41, and X am content to take that statement instead of the former one for the purposes of comparison. Taking the rate 16-41 as the rate for the past year as against 1S-28 in 1896, we shall reach the conclusion that if the old tariff had remained in operation and been applied on the imports of last year, the duty levied would have been larger to the extent of $3,292,230. In other words, if the old tariff had been in operation as applied to the imports for home consumption last year, it would have levied and taken from the pockets of the people $3,292,230 more than was taken by the tariff of the present government.
I am going to ask the House to bear with me a few minutes while I present some statistics which are likely to be tedious, but which will bear study.
It will be remembered that on several occasions in connection with budget speeches, series of diagrams were published which served to show very graphically the growth and progress of .the business of the country from year to year. I have not done that this year. An attempt to make a statement following up the growth of business Mr. FIELDING.
every year since confederation would be very tedious. But I am quite sure that in the convenient form of a budget speech, we should like to have some figures which would give an idea of the progress Canada has* made since confederation to the present day, and if I can do that in a condensed way, it will be useful. Instead of giving a yearly statement, I propose to take leaps of five years and only make the statement for every fifth year.
One measure of the growth of the business of the country is commonly considered the circulation of Dominion notes of all denominations.
Oot. 31, 1870 1875 1880 1885 1890 1895 1900.
Increase
Circulation over fifth Decrease Dominion year under notes. previous, fifth year. $ 7,450,334
11,119,485 $3,669,151 14,693,744	3,574,259
18,072,355	3,378,611
16,760,789		 $1,311,566
22,893,259	6,132,470
28,113,229	5,219,970
I have given the circulation of Dominion notes generally, but the small notes of one dollar and two dollars are supposed to be perhaps the very best standard by which to judge of the business of the country, because as business increases there is an increased demand for these small notes.
Circulation of Small Notes ($1 and $2) at the dates named.
Increase.
Oct. 31, 1875	 $3,489,830
1880	
3,999,452	$ 509,6221885	
5,602,514	1,603,0621890	
6,905,079	1,302,5651895	
7,312,917	407,8381900	
10,236,116	2,923,19a
Total Circulation of the Notes of the Chartered Banks of Canada at the dates named.
Increase Decrease Notes	over under
in fifth year fifth year Cireulation. previous, previous
Oct. 31,,1870	 $18,642,895
1875	
25,599,331	$6,956,4361880	
27,981,567	1,382,2361885	
34,576,246	6,594,6791890	
36,480,649	1,904,4031895	
34,671,028	
$1,809,6211900	
53,198,777	18,527,749
Let me now give statements showing deposits in government and post office savings banks and banks :
Statement of Total Balances at Credit of the Depositors in the Government and Post Office Savings Banks.
Increase
June 30, 1869-70...
1874-5....
1879-80...
1884-5...
1889-90..
1894-5...
Balances.

over
fifth year previous.

Statement of Deposits by the Public in the Chartered Banks at the dates named.
	Deposits.	Increase over fifth year
June 30, 1870	
$ 54,074,760	previous.1875	
61,094,860	$ 7,020,1001880	
76,244,065	15,149,2051885	
95,030,429	18,786,3641890	
128,631,455	33,601,0261895	
182,688,227	54,056,7721900	
277,256,716	94,568,489
The following figures will show the exports of Canadian produce by five year terms in the same way :
Statements of Exports the years named.
of Canadian Produce for Increase over
Exports. previous fifth year.
1869-70	 $ 67,045,868
1874-5	
70,749,660	$3,703,7921879-80	
74,671,452	3,921,7921884-5	
81,158,715	6,487,2631889-90	
87,697,368	6,538,6531894-5	
103,085,012	15,387,6441889-1900	
170,642,369	67,557,357
Statement of Total Imports for Home Consumption for the years named.
1869-70 . 1874-5 .. 1879-80 . 1884-5 .. 1889-90 . 1894-5 .. 1899-1900
Imports.

Increase
over
fifth year previous.

Decrease under fifth year previous.

Statement of the Total Trade of Canada for the years named.
		Increase	Decrease
Total	over	underTrade.	fifth year	fifth yearprevious.	previous.1869-70 ....	.. $148,387,329	1874-5 	.. 200,957,262	$52,569,933	1879-80 ....	.. 174,401,205	$26,556,0571884-5 	.. 198,179,847	23,778,642	1889-90 ....	.. 218,607,390	20,427,543	1894-5 	.. 224,420,485	5,813,095	1899-1900 ..	.. 381,517,236	157,096,751	
I thought, Sir, that, in the absence of diagrams, these condensed statements would give us a hurried review of the progress of Canada in these various departments from the time of confederation down to the
present.	_
So much has been said about the Yukon, that I am sure that the House will be interested in knowing something about the receipts and expenditures of that district. I have first made a statement of the royalties, because that is a special item, and, perhaps, should be separated from the general receipts :
Royalties-Y ukon.
1898	
*	
$287,423 551899	
575,812	791900	
730,771	99
Six months to Dec. 31, 1900... 446,184 28

Showing that in the three and a half 3'ears, we have received in the way of royalties alone from the Yukon the sum of $2,040,000, I have had a larger statement prepared, however, which is not confined to royalties, but will show briefly the receipts and expenditures of all classes on account of the Yukon territory :


YUKON TERRITORY.
[Stage Direction]
Revenue.

*	1896-7.	1897-8.	1898-9.	1899-1900.	t Total.^Interior	
.. Post Office	
Customs	8 cts. 8,593 00 50 00 9,873 24	$ cts. 735,485 09 2,083 50 63,185 39	8 cts. 1,261,816 30 9,461 28 482,098 55	$ cts. 1,130,905 49 21,550 99 613,191 97 33,716 88 4,601 48	8 cts. 3,136,859 88 33,145 77 1,168,349 15 33,716 88 4,601 48
Total						
	18,516 24	800,753 98	1,753,376 13	1,804,020 81	4,376,673 Hi
'Including loyalty, miners' certificates, mining fees, land sales, rentals, timber dues, placer grants, &e.
It is but fair to state that the Yukon should be credited, I think, with a further sum. These figures represent only the actual collections in the Yukon. But we all know that a very large proportion of the goods imported at Vancouver or Victoria, or, for that matter, in the eastern cities also,
while paying duties at these respective ports of entry, are afterwards shipped to the Yukon, and, in that way, I have no doubt, the Yukon has added very largely to our revenues in addition to tlie sums I have stated. As to expenditures, the following table will give the figures :
[Stage Direction]
Expenditure.
1896-7.	1897-8.	1898-9.	1899-1900.	Total.Interior	[DOT]f cts. 5,998 47 40 00 3,938 78	$ cts. 47,026 65 43 33 3,239 09 14,000 00 4,996 00 933 97 495,770 08 99,975 75	$ cts. 223,526 24 21,950 39 [DOT] 28 931 88 68,619 32 55,952 92 12,640 98 874,852 72 387,763 41	$ cts. 331,850 21 112,368 57 30,561 84 118,544 05 24,457 50 22,673 56 492,427 52 173,266 21 800 00	$ \ cts. 608.401	57 134.402	29 66,071 59 201,163 37 85,400 42 36,254 51 1,885,185 08 661,005 37 800 noCustoms	
Public Works.. .	Railways and Canals	.1 uatice	Mounted Police	
Militia	22,134 76	Marine	Total	32,112 01	665,984 87	1,674,243 86	1,300,949 46	3,679,290 20
Excess of receipts over expenditure on consolidated fund	$097,382 96
Public Works capital	 508,874 90
Excess of receipts over all expenditure	 $128,508 0(1
Thus we find, if we take all the expenditures chargeable to consolidated fund and this extra sum chargeable to capital, our revenues from the Yukon, without counting the indirect revenues I have referred to, amount to $128,508.00 over and above all expenditures in that district.
Now, it was the policy of the government, at the beginning-to use an expression which has become current-to make the Yukon pay for the Yukon; and that has been carried out. And, now, Sir, in view of this very handsome financial statement to the credit of the Yukon, and in view also of the desire of the government to encourage the development of mining in the Yukon as a permanent business, now that the first rush for rich creeks has passed, my hon. friend the Minister of the Interior has been able to announce a very important step-that is, that the royalty in the Yukon district instead of luring 10 per cent, shall hereafter be 5 per cent. That, I have no doubt, will be a very important concession for the development of the country. We do not think that a reduction was needed earlier. So long as the first flush of the Yukon excitement was on, the people were ready to go in and pick up their nuggets and pay the royalty cheerfully. But that is over, and, if that is to be a permanent mining district. mining must be carried on under better conditions than heretofore. Everything that increases the cost of mining is a disadvantage to the miner and to the development of the district. So. my hon. friend the Minister of the Interior has concluded to advise that this reduction should be made and we have accepted it. This does not necessarily mean that the revenue will be reduced by half. For my part. I am a great believer in the idea that you can sometimes get as much money out of a low duty Mr. FIELDING.
as out of a high duty. I am not prepared to say that it will be so in this case, but, undoubtedly the tendency of high duties is to lead to smuggling. Therefore, with a less royalty than we have heretofore had we shall be able the better to collect the revenue, and I trust we shall not have so great a falling off in the revenue from that source as might seem probable from the mere announcement of the reduction of the duty.
The House will be glad to be informed as to the expenditure on the South Africa contingents and the garrison at Halifax. We appropriated two millions for the war in South Africa, and the probability is that that will just about cover our expenditure.
The following figures show the expenditures upon the contingents :
Expenditure on South African Contingents.

[Stage Direction]
First contingent	 $ 305,503 57
Second "		 946,714 48
General	 185,387	77
[Stage Direction]
Less refunds	
8,247	22Total expended 1898-1900	
$1,429,358	60
Expended to Feb. 26, 1901, from
June 30, 1900	
539,356	77Estimated further expenditure	35,000	00Probable total expenditure	
$2,003,715	37
Thus it will be seen that the expenditure will probably be very slightly over the amount already appropriated. Over and above that, however, we have made provision for a special item with respect to the garrison at Halifax. It will be remembered that it was the desire of Her Majesty's gov-

eminent to withdraw the Imperial regiment from Halifax in order that they might take part In the war, and the suggestion was thrown out that Canada might garrison Halifax. That was very cheerfully done. What may be the future of the arrangement we have yet to know and to announce to the House. The following figures will show the expenditure on the Halifax garrison :
Halifax Garrison.
1899-1900	 $116,265	14
Expended between June 30, 1900, and
Feb. 26, 1901	
184,711	73Estimated further expenditure, 19001901	
85,000	00
[Stage Direction]
Recapitulation-South Africa Contingents and Halifax Garrison.
The expenditure on the South African war and Halifax garrison may be summarized thus :
Expended in 1899-1900 for South Africa contingents and the Halifax
garrison	
$1,547,623	74Expended from June 30, 1900, to Feb. 28, for South Africa contingents and Halifax garrison	724,068	50Estimated further expenditure to June 30, 1900	
120,000	00Total	$2,391,692 24
So that at the close of the fiscal year the account will probably stand, $2,000,000 expended for the contingent in South Africa and $387,000 expended on account of the garrison at Halifax. I am glad to be able to make a very satisfactory statement with regard to the credit and standing of Canada abroad. Happily, under all governments Canada's credit for a long time has stood strong, and we have reason to congratulate ourselves that during the past two or three years circumstances have helped us to add to that strength. The House will remember in the last parliament we passed an Act whereby, in conjunction with an Imperial Aet, arrangements were made for placing Canadian securities upon what is called the Trustee List of England. It has happened that during the past year or two the condition of the money market in England has been one of considerable severity. If we were merely to look at the quotations for our loans without reference to the conditions surrounding them, we might easily reach the conclusion that Canada had merely held the credit she had several years ago. I think, however, we can comfort ourselves in the belief that we have strengthened our position somewhat. Our 24 per cent loan, which I had the pleasure of placing in London in 1897, was issued at a little more than 914, £90 10s. and a fraction. These stocks went as high in 1898 as 944, and they have been as low at times as 89. In the latest quotations our Canadian 21
per cents are quoted at 92, which is only a fraction better than they were when they were placed on the market in 1897. But if we would correctly understand our position in this respect, we will look at the price of standard British securities, the consols, as they stood in 1897, and as they stand now. We find that in 1897, when our loan was issued at 911 and a fraction more, British consols were quoted as high as 113J. To-day Canada's securities stand a fraction better than they did when they were placed on the market in 1897, but British consols, which were quoted as high in that year as 1131, in consequence of the stringency of the money market and the difficulties arising from the war, have fallen as low as 97J. So when you come to compare the .conditions as they were in 1897 and the conditions to-day, you will discover that while in the actual condition of the money market all securities have fallen to a considerable extent, while the standard security of all British consols has fallen in a very marked degree, the securities of Canada have held their own and stand to-day a fraction better than when the loan was placed in the year 1896.
I have referred, Mr. Speaker, to the question of the! bounties on steel and iron. There is a matter in connection with that subject which I should now mention to the House. The policy of paying bounties on steel and iron was adopted a good many years ago, and by some strange process, the exact reason for which one cannot easily find, that was never made a direct payment from the treasury. A curious process was adopted whereby these payments were treated as refunds or drawbacks in the Customs Department. Now, if a man pays duties under an error and has to have a refund, that is right; the amount should be deducted from the customs revenue, because it affects the customs revenue. But the payment of a bounty on steel and iron was certainly not a refund, because the money never went into the treasury, and why it should come out of the treasury in the form of a refund or payment in that way, I have not been able to ascertain. However, that was the method established and we have followed it up to the present time. The consequence has been that our actual revenue for customs has been stated somewhat less than it really was, because it was charged with these sums. Hitherto they have not been much, they have been much in the aggregate, but in any one year up to the present time the amount has not been large enough to become a matter of any considerable consequence. But with the prospect of having to pay very large sums now and for several years to come for that service, I think the House will agree with me that it is time there was a change in the method of book-keeping. I propose, therefore, that hereafter, beginning
[Stage Direction]
with the 1st of July next, whenever payments are made in the way of bounties on iron and steel, they should be paid directly from the treasury and should be shown in the public accounts in that way, instead of appearing in the Auditor General's Report, which is the only place you can conveniently find them, as a refund of duty, which is of course entirely incorrect. Now, I think the House generally will agree with me that this is a wise policy. There is one other point in connection with the matter. If these bounties were to be paid continuously from year to year as part of our ordinary expenditure, we should of course have to charge them against the revenue of the year, they would have to be charges against income. But the House is aware that we are treating this as a temporary subsidy for the establishment of a great industry, and we propose that that should cease to exist this year in a short time-in six years from the 1st of July next. We propose, therefore, to treat this precisely as we do a railway subsidy, and that it should appear in a statement of the public accounts exactly as a railway subsidy now appears. That will make a slight change in some comparisons that are occasionally made. If we want to be absolutely exact in our calculation with respect to customs revenue and with respect to surplus and deficit, a careful note must be taken by those interested in such discussions, and it will be admitted that it is better that we should make a change in the way I propose than that we should go on paying large sums of money, one million, two millions, some persons say three, four or five millions, in the way that it has hitherto been paid, thus diminishing our apparent customs revenue, instead of paying it as a direct charge upon the country.
Nathaniel Clarke Wallace: Will it be charged to, consolidated revenue fund ?


The MINISTER OF FINANCE.: It will not be charged to consolidated revenue fund.
Mr. WALLACE, Why ?


The MINISTER OF FINANCE.: It will be treated as a railway subsidy. We have treated railway subsidies, not as chargeable to the ordinary revenue of the year, but to a special revenue, and not as if it were to become an ordinary and annual charge. If it were a continual charge it would be perfectly right to charge it against the consolidated fund, that is, against the ordinary expenditure of the countiy ; but as it is to be a special charge, existing only for a short period and designed as -a subsidy for establishing a great industry, we propose to treat it exactly as the grant of a similar sum of money for the encouragement of a railway.


Nathaniel Clarke Wallace: Then we understand it will be charged to capital account ?


William Stevens Fielding: 


The MINISTER OF FINANCE.: Well, the book-keepers .make a fine distinction, which perhaps neither my hon. friend nor myself clearly see, between capital account and railway subsidies. Perhaps the theory upon which that has been done is this : That if you make a public work, even though it is only a hole in the ground, it belongs to the Dominion, but a subsidized railway does not belong to the Dominion. That is the theory, at all events. We do not call it, technically, capital account. It is charged to a special account, but in the sense which the hon. gentleman has in his mind it is capital account, inasmuch as it is not charged in the ordinary expenditure of the year.
I do not propose, Mr. Speaker, to make any changes in the tariff. In saying that I do not for one moment assume that the tariff is perfect, I quite realize that imperfections may be shown, 1 realize that here and there some special interest would be pleased if we were to make some change. 1 am not prepared to say that there are not some cases in which there are inequalities which might better be remedied. But there are not many items in the tariff which can stand absolutely alone. Occasionally, a man comes to me and says : Mr. Fielding, I entirely agree with your policy in having a stable tariff ; we do not want to make changes generally, but we want you to make this particular change, and everybody will be perfectly satisfied. But I have not found that everybody would be satisfied with the particular change which my particular friend would desire. As a rule, the tariff items have relation one to another, and it is not easy to make any considerable number of changes without opening the door to a wide revision of the tariff. I think the business men of the country have appreciated the value of Some measure of stability in the tariff. I have again and again expressed the opinion that it was better we should bear some imperfection and some inequalities than to be constantly engaged in the process which is irreverently described as tariff tinkering.
Therefore, we say, considering the tariff has only been in force for four years, that we think it is not unreasonable that it shall continue for the present without the changes that some desire to have, for some will always think that it might be a little better for them, and they are patiently waiting for the day to come when there shall be a wider revision than is possible to-day and when possibly we may be able to do some of the things that they desire to-day. I think, that, while, here and there, some particular set of people, or some particular interest, would prefer that we would make changes, the judgment of the country will be that it is better to have some stability about the tariff and not make any changes at the present time.
I have stated that we shall make no changes, but that is not strictly correct, and
I shall qualify that statement in respect to one item, which is scarcely in the nature of a change but rather in the nature of an explanation of a feature of the tariff adopted last year. We have been asked to consider the question of establishing the beet-root sugar industry in this country. We have been asked to grant bounties to that industry and we have not been able to comply with that request. We found that the bounty system, adopted some years ago and put in operation, was not successful, and we are not quite satisfied yet that we would be justified in granting bounties to revive that business. In saying that it is not my wish to discredit, if I could, and I could not because my knowledge would not permit me to do so, the statements of gentlemen who have represented to us that the conditions in the province of Ontario to-day are much better than the conditions were in the province of Quebec and that, therefore, they could probably make Ihe industry a success. We think, at all events, that we have not yet reached the point that would justify us in reviving the bounty system, which was tried before and which was a failure. At the same time, we, last year, made a concession to this industry in the form of free machinery. It was represented to us that they were hoping to secure a bounty from the Ontario legislature, and that if, in addition to that, we could grant them exemption from duty on the machinery, it would be a very valuable concession, inasmuch as machinery is a very large item in the cost of a beet-root sugar factory. Responding to that wish-of course, there are many who would have been pleased had we gone farther, but, responding to that extent-we introduced an item into the tariff for the purpose of making machinery free, but it was qualified with the words that the machinery should be of a class not made in the Dominion of Canada. That is the usual condition of any exemption of that character. It has been represented to us that that qualification, as respects the machinery being made in Canada, prevents the concession becoming of any substantial value to the promoters of this industry. It is represented, and it seems to me to be reasonable, that a beet-root sugar plant is a somewhat delicate piece of machinerjr and that it is important that it should all be made, or controlled, by one manufacturer or contractor, so that he may be held responsible for the equipment of the whole factory, and if he is obliged to buy one piece of machinery in Canada and another in the United States there is an absence of that harmonious co-operation that is essential to success. Taking that into consideration, we have concluded to interpret our Act of last year, and to introduce an amendment which will make it clear that for one year, reserving the question as to whether circumstances will warrant us in continuing it, we will permit the free admission, under any regulations that may be made by the Customs Department, of machinery of every kind imported for the purpose of equipping a beet-root sugar factory into the Dominion. We think, if the Industry is to be put on a basis of business, if the industry Is as promising a one for the Dominion as it is said to be, with the bounty which is allowed by the legislature of Ontario, and with this valuable concession, for it is a valuable concession, in respect to the machinery, an opportunity will be allowed for giving that business a fair trial in the province of Ontario. Such, however, is our hope, and I have no doubt my hon. friend the Minister of Agriculture (Mr. Fisher) will be able to lend' the assistance of his department. I am told that one of the greatest difficulties that they have to contend with in this business, is, in the cultivation of a beet of the proper strength and of the proper quality. That is a matter coming particularly within the authority of the hon. Minister of Agriculture, and I have no doubt that he will be glad to lend the assistance of his department in the way of instruction, information, lectures, circulars and literature, or in any direction that tends to improve the cultivation of the beet.
Now, a marked characteristic of the present session has been short speeches and I desire to have the budget speech respond to that general feeling. After all. the only question of real importance in the budget speech, outside of the general information it contains and which may be interesting, the thing that always interests people in the budget speech is the question of tariff changes, and as we have no tariff changes to announce, there is no reason why I should occupy the time of the House with an extended speech. The tariff policy we have to offer to-day is the tariff policy which we adopted in 1897 and which we have continued up to the present time. It is a tariff policy based upon the necessities of our revenue, a revenue tariff, which incidentally affords a very considerable degree of encouragement to those engaged in Canadian industries, and having as its leading principle the principle of the British preferential tariff. I am afraid that on that question we are as wide as ever from our hon. friends opposite. Perhaps it is not easy for me to determine how wide the difference is between us, in view of some of the conflicting statements hon. gentlemen have made from time to time, but I suppose I shall not be wrong if I say that the ground taken by hon. gentlemen opposite is, that while they are in favour of the principle of a British preferential tariff, they are opposed to what they call a one-sided preference.


Some hon. MEMBERS: Hear, hear.


The MINISTER OF FINANCE.: Hear, hear ; I am glad to receive these hear, hears, because they show that I have correctly de-

scribed, as I desire to do, the attitude of hon. gentlemen opposite. They say that they are opposed to a one-sided preference and they say our preference is a one-sided one.


Some hon. MEMBERS: Hear, hear.


The MINISTER OF FINANCE.: Hear, hear; and again I am glad to have it. Surely if a one-sided preference is bad, and If our preference is a one-sided one, there is only one thing for hon. gentlemen to do, and that is to bring down a resolution to repeal the British preferential tariff.


Some hon. MEMBERS: Hear, hear.


The MINISTER OF FINANCE.: I am bound to believe that they will do so, and if so, of course we will have at once the issue joined between us. We can respect their view although we differ from it. But, we will know exactly where we stand and we will know where they stand. They have held that we did wrong in granting a preference to the goods of Great Britain without demanding a preference for Canada in the markets of Great Britain.


Some hon. MEMBERS: Hear, hear.


The MINISTER OF FINANCE.: Again, those comfortiug hear, hears, which show that I am correctly giving the views of my hon. friends. They have been pleased to try to persuade themselves and try to persuade the public that the preference in the English market, which they desire, can be had for the asking. Year after year they have endeavoured to persuade themselves of that. I suppose, that, like a man who tells the same story agaip and again until he persuades himself that it is true, many hon. gentlemen opposite have persuaded themselves they can easily obtain that preference in the English market. We thought that the utterances of the English press, the articles published in the great British journals, the statements of the leading public men in both political parties, and most of all the statements of such men as Mr. Joseph Chamberlain, Sir Michael Hicks-Beach and the Duke of Devonshire, made it perfectly clear that that preference, which hon. gentlemen opposite believed It was so easy to get, could not be obtained in the English market, and that view we still hold. The only new incident that has occurred that I can recall since I last discussed this subject here, was that which occurred in connection with the meeting of the Associated Chambers of Commerce in London last summer. There the question was raised in a very gentle and modest form ; in the form of a resolution asking Her Majesty's government to appoint a royal commission to inquire into the question of Im-Mr. FIELDING.
perial trade. But even in that innocent form, so innocent and harmless that it is difficult to see how any one would oppose it, we find that when they asked a hearing before the British Prime Minister to present their resolution, he stated that the time was not opportune to consider it and he declined to receive the deputation. And then, discouraged and discomforted by the illustrious Prime Minister of Great Britain, they went to the Colonial Secretary. They made a visit to Mr. Chamberlain, who, I have no doubt, received them with that great courtesy and consideration which he always extends to Canadians. They tried to persuade Mr. Chamberlain that his preference should be granted, and their own records and reports show us-and can be quoted if necessary- that Mr. Chamberlain told them courteously but firmly and emphatically, that the thiag could not be entertained for a moment unless they were prepared to give up their tariff protection against Great Britain. That was the basic principle of Mr. Chamberlain's statement, and these gentlemen were not prepared to give that up, nor would I have been prepared to give it up if 1 had been in their place.


Mr. MACLEAN.: Mr. Chamberlain may have to change his mind like others.


The MINISTER OF FINANCE.: Possibly. My hon. friend (Mr. Maclean) will do me the justice to say that I am dealing with things of the past and present, and we will not say too much of the future, but I say that as respects the past, in the year 1897, when we adopted our tariff, that policy of a preference in the English market was not possible. It was not possible in 1898 ; it was not possible in 1899 ; it was not possible in 1900, when the Prime Minister of Great Britain refused to even receive a deputation to talk about it ; it was not possible when the distinguished Colonial Secretary told the deputation that he could not entertain the matter unless they were prepared to abandon the tariff against Great Britain.


Mr. KEMP.: May I ask the hon. gentleman (Hon. Mr. Fielding) where he got his information in reference to his observation that Mr. Chamberlain refused to receive the deputation ?


The MINISTER OF FINANCE.: My hon. friend (Mr. Kemp) has misunderstood me. I did not say that Mr. Chamberlain refused to see the deputation. I am aware that the deputation of which my hon. friend (Mr. Kemp) was a member, called on Mr. Chamberlain. What I did say was that the Prime Minister, Lord Salisbury, refused to see the deputation which only asked the privilege of presenting this bald and not very strong resolution.


Albert Edward Kemp: There was no deputation to Mr. Chamberlain.


The MINISTER OF FINANCE.: Do you say there was no deputation to Mr. Chamberlain ?


Albert Edward Kemp: Not this last summer.


The MINISTER OF FINANCE.: I hold in my hand the report of the delegate of the Ottawa Board of Trade, who was one of the deputation which called upon Mr. Chamberlain, and who describes Mr. Chamberlain's reception precisely in line with the statement I have just made.


Albert Edward Kemp: A deputation from the Chamber of Commerce did not call on Mr. Chamberlain.


The MINISTER OF FINANCE.: Well, now, my hon. friend (Mr. Kemp) is a new member, and he surely does not mean to distinguish between a committee formally appointed by the Chamber of Commerce and a number of gentlemen who were members of that body. But if it was not a deputation of the Chamber of Commerce, what have we to think of the Ottawa delegate who gives a full report of the whole proceeding, as a part of the proceedings of the Congress of Chambers of Commerce in London ?


Albert Edward Kemp: Do I understand the Minister of Finance to say that the deputation which called upon Lord Salisbury also called upon Hon. Jos. Chamberlain ?


The MINISTER OF FINANCE.: My hon. friend (Mr. Kemp) is mistaken again. I did not say that. My hon. friend (Mr. Kemp* tries to draw a distinction between a deputation formally authorized by the congress, and a number of gentlemen who were members of that congress, and who, I suppose, were not formally appointed for the purpose of waiting on Mr. Chamberlain. I do not think the hon. gentleman (Mr. Kemp) will ask us to treat that distinction as serious. I have here the report addressed to the president and members of the Board of Trade of Ottawa. It is of very great length, and the House would not justify me for delaying them by reading very much of it, but I think I will have to give a passage. This is the report of Mr. Thomas Macfar-lane. the delegate from the Ottawa Board of Trade.


Nathaniel Clarke Wallace: Is that the Dominion analyst ?


The MINISTER OF FINANCE.: I think likely. He seems to have analysed this question over there very well.


Some hon. MEMBERS: Hear, hear.


Nathaniel Clarke Wallace: He did not represent the commercial men of Ottawa very much.


The MINISTER OF FINANCE.: He was appointed by the Board of Trade of the city of Ottawa to represent them, and my hon. friend (Mr. Wallace) is not treating that body with very great courtesy when he says Mr. Macfarlane did not represent them. I presume if he was delegated by them that he fully represented them. This report recites the story of the failure of the deputation to obtain a hearing from Lord Salisbury, and then it goes on to say :
Chamberlain interview.
Quite as interesting as the proceedings of the congress itself were certain events which happened after its close, and in which some of the delegates took part. Most of them received a copy of a printed circular containing the letters from the Premier and the President of the Board of Trade in which they declared the time to be inopportune for discussing the subject of increasing and strengthening trade relations between the different portions of the Empire.
I This was a great disappointment, and it was,
! I believe, in order somewhat to make amends for it, that Lord Strathcona arranged with the Rt. Hon. Mr. Chamberlain that he should informally receive some of the Canadian delegates.
My hon. friend (Mr. Kemp) will see that they did not go formally. They were not formally delegated by the Chambers of Commerce to go, but a number of the Canadian delegates went to Mr. Chamberlain, and I think they did quite right to do so.


Albert Edward Kemp: That does not say what Mr. Chamberlain stated.


The MINISTER OF FINANCE.: My hon. friend (Mr. Kemp) is too hasty. He had better wait. I trust the House will pardon me if I have to read a somewhat lengthy extract. The report goes on to say :
This interview took place on the 10th July, when, besides the Colonial Secretary, Lords Selborne, Ampthill and Strathcona were present. Of delegates : Mr. Kemp of Toronto, Mr. Cock-shutt of Brantford, Dr. Parkin, General Twigge and I attended, who all had an opportunity of pressing upon Mr. Chamberlain our views regarding trade relations. Messrs. Kemp and Cockshutt spoke generally of the advantages of preferential trade, and Dr. Parkin tried to show the necessity of having the subject properly I investigated by a commission of experts. Mr. Chamberlain replied in a quiet conversational way and endeavoured to show that no progress could be made until the colonies abandoned protection as against Great Britain.


Some hon. MEMBERS: Hear, hear.


Albert Edward Kemp: Will the hon. minister allow me to say, that I understood the Finance Minister to state that the deputation which desired to wait on Lord Salisbury, also wished to wait on Mr. Chamberlain. That

146S
is what I meant, but perhaps X did not make my point very clear.


The MINISTER OF FINANCE.: I quite agree with my hon. friend (Mr. Kemp) that the deputations were not necessarily the same, but the only point of my remarks was, not exactly what the board of trade did ; not what any particular delegate did, but what Mr. Chamberlain said and did. I cannot understand how the force and effect of what Mr. Chamberlain said and did is in the smallest degree touched by the circumstance as to whether the delegation went by one street or by another. I thank my hon. friend (Mr. Kemp) who interrupted me, because I know he was present, and I think he did quite right in going to Mr. Chamberlain. The point I desire to make in all sincerity is this : that these hon. gentlemen who have persuaded themselves that this getting of a preference in the English market was an easy and simple thing, have been mistaken, and they must know it now from the highest possible testimony. Again and again it was suggested that Mr. Chamberlain in some mysterious way had given them some encouragement, but here is the latest utterance of Mr. Chamberlain quoted by a gentleman who is known to be an enthusiastic advocate of that kind of preferential trade, and Mr. Chamberlain says distinctly that you cannot get that kind of preferential trade unless you will take down your tariff altogether against England. My hon. friend from Toronto would not be willing to do that, and I am frank enough to say that I would not be willing to do it either.
Now, I have said all this concerning the past. We do not deny that if we did get that preference in the English market, it would probably be of some advantage to the Dominion of Canada; but we say that is a question for the Imperial authorities rather than for us. If we could get that preference, we are as willing to assist in availing ourselves of any advantage which might come to Canada through it as any of the hon. gentlemen opposite. The only difference between us is as to the possibility of getting it and as to the means of getting it. I do not believe, Sir, that it can be obtained to-day. I do not believe, notwithstanding all that one reads in the telegrams from the other side, that we are likely to have a change of front immediately on the part of the Imperial government on the trade question. Yet I would not speak of the future. We live in times of great movements and great changes. I will not say that at no future time in the history of the empire, and the early future possibly, shall this preference be given. Again and again I have stated in this House that that is a question which we must be content to leave to the future. We have believed that the true policy of preferential trade was, not to make demands on the Imperial gov-


William Stevens Fielding: eminent which we well knew they could not afford to yield to us. The true policy was to give to Great Britain this preference freely and openly, leaving the Imperial government and parliament to adopt that trade policy which in their judgment was best adapted to the interests of the English people. But, if this preference, which my hon. friends opposite desire to obtain, is ever to come, I beg them to accept my opinion, my assurance, which I give them in all sincerity, that they will never obtain it by the methods they have employed-that they will never obtain it by demands on the home government which are obnoxious to the great mass of the English people. We have much to hope from cultivating the good-will of the English people. I venture to say, as I have said before, that if the time ever comes when we are to receive that preference, we shall not receive it as the result of any huckstering or bargaining between England and the colonies, but as a result of the development of that Imperial sentiment which may override questions of political economy, and in the creation and development of that Imperial sentiment a large and important factor has been the British preferential tariff of the Canadian government.


Mr. E. B. OSLER (West Toronto).: Mr. Speaker, I must congratulate the Finance Minister and the government, as I congratulate the country, upon the statement of prosperity which the hon. gentleman has been enabled to show to Canada to-day-a prosperity which we one and all delight in, and which the Conservative party claim to have had a very considerable hand in promoting, by means of the policy which they adopted in years gone by. This claim, however, the Finance Minister and the government dispute; they take issue with us on the question of protection and free trade. We as a party claim that protection has materially advanced the interests of Canada. We contend that without protection the interests of Canada would be very seriously impaired, no matter how bountifully Providence might bless us with crops or how rich our mines might be.
The Finance Minister, I am glad to say, has been able to make a very short budget speech. He has quoted comparatively few figures; and I do not propose to objeet to or in any way challenge the figures he has quoted. Our trade has very largely increased; our imports, our exports, our revenue and our expenditure have all increased. The government are trustees for this country. They are not spending these enormous sums of money, or should not be spending them, as their own. but should be spending them for the benefit of the country. In the last four years they have had a revenue amounting to S30.S80.000 over and above the revenue of the preceding four years. This amount they have taken in
] 469
direct taxation out of tlie pockets of tlie people over and above tire expenditure. This surplus of revenue over expenditure should be treated in one of two ways: it should go either to reduce the taxes or to reduce the debt of the country. What indication has the Finance Minister given us that he has treated this surplus in either of these ways ? He has spent it with a free hand. He has not been able to show us a decrease in the net debt of the country ; but, on the contrary, in the last four years he has increased the debt to the extent of *$6,900,000, notwithstanding the enormous increase of revenue which he has had at his disposal.
The hon. gentleman boasts of the increased trade of this country with Great Britain. He was asked how the exports of the United States to Great Britain stood. He had not the figures at hand. The exports from the United States to Great Britain show an average increase in the last four years of $105,000,000 a year. Naturally our imports from Great Britain should show an increase; but they have not increased in any greater proportion than the imports of the United States from Great Britain, notwithstanding our boasted preference.
I agree with all the figures which the hou. gentleman has given us as to the increased deposits in our banks and the increase in the circulation of Dominion notes. 1 give him credit for all the figures he has given as bearing on the prosperity of the country. I give him full credit for the surplus he claims, but I deny that the government have made a good use of that surplus. I agree with the lion. Minister of Finance that we are perhaps on the crest of the wave of prosperity and that it will continue for some time to come. When we have to face a falling revenue, however, how are we going to meet it ? It is a very hard matter to cut down expenditure. We have increased our expenditure over the sum which the Finance Minister in the Mackenzie government stated was ample: we have added to that by millions of dollars, yet that lion, gentleman's voice is not raised against it. Wp have been spending money freely.
The hou. gentleman has no thought for the morrow. Is be going to make no en-*deavour to restrict the amount of our debt ? He tells us that the bounty to be paid on iron he will not consider as a payment out of revenue, but will add it to our debt. Is there to be no limit to this method of conducting business. Where are all the professions of economy and all the platforms of the present government when in opposition. which many of us thought were good platforms. They proposed to reduce expenditure, they proposed to cease bonusing railways and other works which they thought should not now require public money. For many years before I became a member of this House. I protested, whenever the occasion presented itself, against this continued
bonusing of railways. That system has become a channel for the wasting of public money. If hon. members will turn to page A-75 of the report of the Auditor General, they will find instances to illustrate my contention. On that page there is some interesting correspondence regarding the subsidy to the South Shore Railway bridge at Sorel, which was given a bonus of 15 per cent on its cost. A claim was made upon the government for $35,000 as the amount of the bonus, but the Auditor General, suspecting' that something was wrong, objected, and he apparently had very great difficulty in preventing the payment of this $35,000. He finally obtained reports from the chief engineer of the government and Mr. Keefer on the cost of this bridge. The chief engineer reported that it cost $98,000. and Mr. Keefer reported that it cost $112,000. On the other hand, the company allege that it cost $210,000, or more than double the estimate of the government engineer. The Auditor General then goes on to say :
I should tremble on account of my responsibility in passing your expenditure if much of your course of action were permeated by a similar complaisance. The views of an interested creditor are not the most reliable help in the interpretation of a statute under which he is to be paid. I was told by one of the gentlemen named, without my seeking his opinion, that in endeavouring to determine the value of the work 1 was giving myself much unnecessary trouble. There is a name to this kind of advice, but I do not need give it.
Apparently the Auditor General had the greatest difficulty, judging by this correspondence, with the Deputy Minister of Railways and Canals, in preventing the govern-men paying out fraudulently $35,000 of a bonus on that bridge, or 15 per cant on an estimated cost of $215,000, when the bridge really cost only $90,000. Let me further draw attention to the fact that that same bridge was bonused by the Quebec government and the town of Sorel. The Quebec government had paid its $15,000 subsidy and the town of Sorel had also paid the amount of its bonus, and if this government had paid the $35,000 asked for, it would have paid $12,000 more as a bonus than the total cost of the bridge.
Is it not evident, when we have such an instance before us-and judging by the Auditor General's correspondence, it would appear that it is not the only instance-to call a halt in this system of bonusing railways and squandering the public money in the bonusing of railways and other public works. I say it is the duty of the government to cease giving bonuses for the building of railways or other public works in the older provinces. What would be thought of a railway company that would apply to the state of New York or Minnesota or Illinois for a bonus towards building a railway. Yet such an application is equally unreasonable in our older provinces, because

If public works of this character are needed private enterprise will be found to build them, just as private enterprise undertakes their construction in the United States. In my opinion, we are quite as able as most of the states of the American union, to build our own railways and public works without government assistance.
It is, of course, only natural that our expenditure should increase as our trade increases, but this increase in expenditure is far outrunning any increase in revenue, and there is not the slightest attempt on the part of the government or any member of it to keep our expenditure within our means. Has the hon. the Finance Minister ever thought what would happen to this country if he should go on as he is doing for the next twenty-five years ?


The MINISTER OF FINANCE.: Yes, I have.


Edmund Boyd Osler: Does lie propose going on borrowing as long as he can in the English market ? It seems to me he would do better to try and take advantage of a flourishing revenue to reduce our capital debt and not go on losing all the benefit of the increased revenue by continuing this system of lavish expenditure.
We have in this country one instance of a railway built without government aid, and that is the Ontario and Quebec road, running between this city and Toronto. When that road was built, the country, in the section traversed, was pretty barren, and we were not then as well able to build railways as we are now. Bonuses to the extent of $1,000,000 had been granted it when its charter fell into the hands of people controlled bj# the Grand Trunk Railway. They refused to build the road and fought hard to prevent it being built, but private enterprise stepped in and supplied the money to carry through the undertaking, which cost $5,000,000. Not a cent in bonus was asked for from this government or from any municipality, although that is one of the most expensive roads built in the country. This shows clearly that private money is forthcoming to prosecute any public enterprise when the necessity is clear.
I submit that all local roads in the older settled parts of the country should be built with private money. There is a very flagrant instance of the abuse of the bonusing system in Essex county, where the government bonused a road four or five miles long, running through a district as rich as any in Canada.


Mr. COWAN.: There was no road bonused in the county of Essex last year.


Edmund Boyd Osler: I meant the county of Elgin. A road was bonused by this government
which went through that county, one of the
richest in this country, and which is paralleled along a distance of forty miles by another railway. That bonus was certainly not given for the good of the country, and I leave it to be inferred by hon. gentlemen what was the sinister influence brought to bear to obtain such a bonus.
There is another matter in which the government have been very remiss. The issuing of scrip to half-breeds in settlement of their claims was begun, I know, under a Conservative regime, but 1 have always entertained the opinion that that was a most pernicious policy, and why it should be continued I cannot possibly conceive. Last year, from the 1st of July, 1900, to the 28th of February, 1901, the government issued scrip to the half-breeds and others to the extent of $799,798, but almost immediately on receipt of that scrip the half-breeds sold it to the agents and brokers who followed the government agents who were distributing that scrip, and I have no doubt that those who received the scrip from the government did not get on an average 40 cents for it. That would be the outside price paid. Since that scrip has been issued it has been taken in payment of lands by the government at par from the 1st of July, 1900, to the 28th of February, 1001. The government took in $268,990 of that scrip at par.
So, they sold their bonds at a discount of GO per cent. The hon. Finance Minister says that the credit of this country is good, yet he is authorizing and permitting the issue of government bonds redeemable by the government at par in payment for coal lands and Crown lands generally, and he has sold as much as a million dollars of those bonds to Indians and half-breeds and others at forty cents on the dollar. And he has already retired nearly $300,000 of them at par. Now, either the credit of Canada is not very good in the North-west, or the hon. minister's way of settling with the half-breeds and others who claim scrip is not very profitable to this country.
The government claims all credit for prosperity. I vsould like to quietly analyse the case and find out what it is the government have done in the last four years for this [DOT] country. They have made many attempts to improve the trade channels of this country-so they tell us. They have given us -so they say-a fourteen-foot channel from the lakes to Montreal. The Minister of Railways and Canals (Hon. Mr. Blair) says he knows there is a fourteen-foot channel, because it is marked on a map in his office. But the captains of vessels who go down to Montreal tell us that they cannot find that channel. The minister says in reply that they must be in conspiracy against him and in league with the forwarding companies.


Edmund Boyd Osler: 


The MINISTER OF RAILWAYS AND CANALS (Hon. Mr. Blair).: Will the hon. gentleman (Mr. Osier) give the names of the captains to whom he refers.


Edmund Boyd Osler: The hon. minister says that the channel must be there, but the captains cannot find it-


The MINISTER OF RAILWAYS AND CANALS.: Name your captain.


Edmund Boyd Osler: I refer to what the hon. minister himself said the other night. He said that some captains complained, but they must have a spite against him, or were in league with the forwarding companies.


The MINISTER OF RAILWAYS AND CANALS.: I do not think I said that.


Edmund Boyd Osler: If the hon. minister will refer to his own statement, I think he will find that I am quite right.


The MINISTER OF RAILWAYS AND CANALS.: I do not think you are.


Edmund Boyd Osler: I think so. Now the harbour of Montreal has not been very much improved. We have not had the cheap transportation nor have we had the increased volume of trade going through the Canadian channels that we were promised. We have not had cheaper navigation nor cheaper transportation from this country than we had before.
Now, there is one thing that the Finance Minister claimed credit for on behalf of the government, and I think it is the only thing that they have done, though whether they should ask credit for it is another matter. I refer to the preferential tariff. There is room for difference of opinion as to whether the preferential tariff is a wise thing or an unwise thing. Let us see how it works out. The government first gave a 25 per cent preference. They were so pleased with that that, having nothing else to suggest, they said :	Let us go one more, and make it
33a per cent. So, they have given the preference at that rate, which admits German, Belgian or Italian goods, the produce of cheap labour competing with our Canadian labour, the only condition being that it shall be sent to Britain and 25 per cent of British labour added to it. Then the whole amount, of which J is made by foreign cheap labour, comes into this country under a preference of 334 per cent. In reality therefore, this preference works out to give the German and other cheap continental manufacturers a much greater advantage than is given to the manufacturers of Great Britain. But, let us see how it works out the other way about. One result of giving this preference to Great Britain is that Germany at once discriminates against Canada. Let us see what effect this has indirectly, and even directly, upon the farmers of Can-47
ada. We were building up a very large export trade between Canada and Germany before this preferential tariff came into1 effect. That trade is largely increasing in the United States. The American farmers are now shipping large quantities of wheat and other grain to Germany. Now, when the American farmer ships his grain to Germany in competition with the Canadian farmer, the Canadian farmer finds that he must pay higher duties than his competitor. Here are the figures showing how much more the Canadian has to pay on various kinds of grain than the American :
Wheat	9'82 cents per bushel.
Rye	  9'16
Oats	4'19
Barley	l'Sl
Corn	 3'27	"
Buckwheat	2'45
Now, that is a very nice little bonus for the Canadian farmers to receive as one of the consequences of the preferential tariff. Yet, I do not see that they are paying lower prices for anything they buy. Are they buying their clothes, their agricultural implements, their tea or other groceries, at lower figures than they did four or five years ago ? As a rule, they are paying more for what they buy. The benefit they get from Liberal rule is that they have to pay more for what they buy, while that which they have to sell they get less for. In theory, preferential trade is very nice; it looks and sdunds very patriotic; but in practice it works out very badly for the unfortunate farmer.
There is one question that, perhaps above all others is interesting to us, and ought to be so, because it is of vital importance to the people of Canada-the question how to get our produce to the port on this continent whence it is to be sent to England, Germany or elsewhere. The government have done their best-and if they had gone about it they could not have done better than they did by bonusing the Grand Trunk, rebuilding their bridge, helping them to doubletrack their line and put on fast trains-they have deliberately set to work to divert trade from Canadian ports to foreign and rival ports.


Mahlon K. Cowan: How about the Canadian Pacific Railway ?


Edmund Boyd Osler: I am not talking about individual corporations, but about the government and what they have done. Individual corporations will go where they can get the best. But if the government can force them to take trade through Canadian channels, so much the more do the government do their duty and so much the more does Canada benefit. Now, the government have been, for years past, spending money on the inland waters. They are proposing to enlarge Port Colborne harbour, with a possible expenditure of four or five millions. They are spending large sums of money on Mid-



land harbour, Collingwood harbour, Depot harbour, and all the channels through which grain comes from our great North-west,
They are trying to get the St. Lawrence canals deepened, they are trying to cheapen transportation to the sea, but they have not yet apparently made up their minds as to whether the future seaport of this country is to be Quebec or Montreal. Let us face that question squarely. Personally, and X think I may speak for all the members on this side of the House, if Montreal or Quebec can be made through Canadian ports from which we can send all our produce, any expenditure the government may ask for that purpose will be ungrudgingly given and endorsed by members on this side of the House. But first let the government find out which port it is to be. The hon. member for Quebec West (Hon. Mr. Dobell) says that Quebec is the best port, others say Montreal is the best port. Now, if Montreal is to be the port of this country, then we must spend enormous sums of money upon it and upon the approaches. It is impossible that Montreal can successfully compete with the American ports unless you have an absolutely safe channel, a channel well lighted, so that an insurance company will consider it safe enough to justify them in insuring a vessel passing through the St. Lawrence at the same price as they wouiu insure a vessel coming to Portland or other ports. The government must face that question. But instead of doing that, they are spending little sums here and there, though large sums in the aggregate, in enlarging a lock or building a dock, which will in no wise contribute to the promotion of the great scheme of making Montreal a great port, if the government have such a scheme in view. It may be found that Montreal cannot be made the port of Canada-I know nothing about its capability except what I may have learned as a layman, but I am beginning to entertain a strong feeling that we shall have to go to Quebec, and that Quebec will be the port of Canada for all time to come.


The MINISTER OF RAILWAYS AND CANALS.: One of them.


Edmund Boyd Osler: Now, if it is to be one of these ports, let 11s find out which, and let us not go on spending all this money here and there, frittering it away, instead of using it for the purpose of building up a national port. We are wasting money on little local railways that will benefit no one except those who receive the bonus, while at the same time that we have no intelligent idea of what is going to be our national port. So far, the result of the action of the government has been to divert trade from our Canadian ports, and to build up American ports; I make the assertion, Mr. Speaker, that the government have materially contributed to that end.


Edmund Boyd Osler: 


Mr. HYMAN.: Will the hon. gentleman be kind enough to explain his position, and tell us his ideas with regard to a summer port?


Edmund Boyd Osler: Now, Mr. Speaker, I do not propose, as I said in the beginning, to enter into a criticism of the figures with which the Minister of Finance has presented the House. I think, as a rule, his figures are all right ; but I join issue with him upon the causes which have enabled him to present so favourable a statement. I do not think he is entitled to congratulate himself and his fellow-ministers, or to take any credit for the prosperity with which this country has been favoured during the past three or four years. I contend that the government have entirely misused that prosperity, they have taken advantage of it to inaugurate a rule of extravagance. In no single instance have they attempted to practice economy. They do not seem to have made up their minds as to what they should do with their surplus. I hope that if another year of prosperity should follow, such as we are now enjoying, and if the Minister of Finance is able to congratulate himself upon an enormous increase of revenue, he will also be able to say that he has reduced the burden of taxation upon the people of this country, that he will point out that while our revenue increases, it is the duty of the government in charge to lighten the burden of the people, either by reducing taxation on the necessaries of life, or by reducing the public debt.
At six o'clock, House took recess.
After Recess.
House resumed at eight o'clock.


James Clancy: Mr. Speaker, we rarely witness the spectacle we had t]his afternoon in regard to this debate, probably one of the most important debates during the session, the one in which the public will take more interest probably than all others. When the hoii. Minister of Finance (Hon. Mr. Fielding) had delivered his budget speech, when he had settled so far as the expectations of the people were concerned any question that may have arisen in regard to the tariff, when he had generally entered upon a discussion of the finances of the country during the past year, and when an hon. gentleman on this side of the House had risen in his place and replied todlim, we found, for the first time in the parliament of Canada, I will venture to say during the whole history of the parliament of Canada, hon. gentlemen put on that splendid, but ill-concealed disdain and refused to make reply to the hon. gentleman who answered the speech of the hon. Minister of Finance. What have we now V The House is barely graced with the presence of the right hon. Prime Minister (Rt. Hon. Sir Wilfrid Laurier). There is not another minister of the Crown in his place.


Mr. BENNETT.: They are in cold storage.


James Clancy: My hon. friend (Mr. Bennett) says that they are in cold storage. 1 hope that they are in some place that will cure them. I shall not enter upon a discussion of a matter that is not the subject fairly of debate, namely, whether we are living to-day in a period of very great expansion, whether we are living in, to use a common phrase, good times. This has not been at all a matter of dispute. It is a proposition to which both sides of the House will assent and I, therefore, am not going' to discuss that phase of the question, nor am I going to discuss the question whether lion, gentlemen opposite have been the authors to any extent of this condition or whether they have been, on the other hand, the means of preventing it. If I should have anything to say in that regard it would be that lion, gentlemen have not made the most of their advantages. Now, Sir, just let me say that there seems to me to be no more critical period in the history of any country than a period of great expansion. What is the effect of great expansion ? The lion. Minister of Finance very aptly said this afternoon : [DOT] We will have periods of depression, but these are periods of recuperation. They are periods for what purpose? There are those periods that must follow periods of great expansion for the purpose of catching up. In other words, we have been discounting the future and I am not disposed to take that rosy view of it that the lion. Minister of Finance took when he was asked if he expected the present state of things to continue and if he would go on with the same expenditures and the same taxation. The answer of the hon. gentleman was that he did propose to go on with the same expenditures and the same taxation. 1 think the hon. gentleman has given a distinct note of warning to the country that he will take no notice of that state of things, to use a very happy phrase of his own ' when the pendulum swings the other way.' No one can doubt the fact that we will have after this expansion a period of depression. If that were not the case it would be to set aside the rule that has so long prevailed in all countries and nobody would attempt to consider whether that would be a recurring incident in Canada as it has been in other countries and as it lias been in Canada. What is the duty of a government during a period of great expansion ? Is it to maintain taxation, is it, professedly under a revenue tariff, to extract large sums from the people and find means of expending them ? We still have a policy of high taxation. When hon. gentlemen opposite had a splendid opportunity to redeem their pledges to the country, when they could have lowered the tariff, when they could have made decreases to a considerable extent in the taxation, wlint did they do ? They, in the face of every pledge made, turned their backs upon these pledges.
47 i
and they are to-day collecting more taxes than ever were collected from the people of Canada. They are boasting of their surplus and they are doing this in the name of a revenue tariff. In 1896, the then Minister of Finance collected from the people under what was said to be a high protective tariff $36,618,000, and in 1900, the present Minister of Finance collected, under a so-called revenue tariff, $51,029,000. I would like to ask the hon. gentleman whether he considers now that he should still maintain the name of a revenue tariff ? The increase, comparing these two years, in the taxation collected amounts to some $14,411,000. The hon. gentleman received a very generous measure of applause this afternoon when lie told the House and the country that he had a surplus of $8,000,000. Hon. gentlemen opposite are on record in this House as to the value of surpluses. Hon. gentlemen, both in and out of this House, set their faces against surpluses and told the people that when you take large sums of money from the people it means that you have taken money out of the people's pockets which should be there. If hon. gentlemen were prepared to say that they had taken less money, that, by economy, or the proper expenditure of money, they had been able to hare a surplus after having fairly met all the proper services of the country, that would be a proper boast to make, but hon. gentlemen have taken the opposite course. It does seem extraordinary that they should be found boasting of their surpluses. I do not see the Minister of Customs (Hon. Mr. Paterson) in his place, but this is what that hon. gentleman had to say.


Mr. TAYLOR.: He is in North Bruce.


James Clancy: My hon. friend (Mr. Taylor) says that he is in North Bruce. Well, he was here at one time, and in 1883, referring to the surplus, he said :
Sir,-This surplus business is quite understood by the people of this country. If the surplus was paid by the minister himself, if he had some means of taking it out of his own pocket and putting it into the public treasury, or if the combined supporters of the ministry had some means of putting that money into the treasury, then we would hail them as benefactors of their country. But, when the hon. Minister of Finance has put his hand into your pocket, and my pocket, and the pockets of the people of this country, and taken therefrom this $16,000,000, then we claim that he has not accomplished any great feat though backed in his act by the parliament of this country.
I am going to ask the hon. Minister of Finance if that language applies to him. 1 am going to ask him, if one of his colleagues used that language on one occasion, what is his position to-day ? The hon. Minister of Trade and Commerce (Hon. Sir Richard Cartwright) criticised with great ability the finances of this country. That was precisely the position the hon. gentleman took, and if that is the position he took in the

past, I would like to ask the hon. gentleman to explain to-day why he takes precisely the opposite position. Mr. Speaker, lion, gentlemen may ignore the past, they may turn their backs upon their pledges, but the facts remain just as they were in 1883, when this speech was made and afterwards when several speeches were made by the Minister of Trade and Commerce and other hon. gentlemen on that side of the House. I leave hon. gentlemen without further discussion to settle that with their own consciences. Let the public read what hon. gentlemen said in the past under precisely similar circumstances, and let mem observe the conduct of those who are charged with the affairs of the country now. I expected that the Minister of Finance (Hon. Mr. Fielding) would sing the old song and claim credit to his government, that if the good times were not wholly to be attributed to the administration they were at least in great part due to the wisdom of himself and his colleagues. It is just as well that I should call the attention of the House to this phase of the question, so that the government may know something about their past record on this matter. In 1883, there was a period of phenomenal expansion in trade following one of great depression, and this is what the Minister of Customs then said in regard to the condition of the country :
The Minister of Finance did not raise the price of cheese or butter in Liverpool. That is a matter outside and beyond him. That is the work of the grand eternal law of nature and the law of supply and demand. It was due to the scarcity in foreign countries. We had the articles to sell. The price went up, and the result was that the increased wealth was given to us. Then, Sir, take agricultural products, and what do we find? Why, Sir, we find that in the year 1880 we exported of these products $2,000,000 worth, and in the next year we exported $16,000,000 worth, and last year we exported $11,000,000 worth, or in these three years, as a result of the increased sale at higher prices, we brought hack in gold into this country $15,712,000 more than in 1879. Well, Sir, will the hon. gentleman claim, will he dare to say that he was the cause of the rain falling and the sun shining on our fields, that he was the cause of the abundant harvest of 1882. No, Sir, he will not venture to do so. Will he seek to claim that he stands in the room of Providence, and causes the rain to fall in superabundance in England and Ireland and Scotland, rotting the crops, producing a scarcity of them and increasing the price of the articles we have to sell. Sir, he will not dare to say that he was the cause of Providence smiling on us in this land, and by which we are able to show $15,000,000 more of a result.
Does not that language apply precisely to the condition of affairs to-day. The bon. gentlemen opposite were fortunate to come into power on the eve of a great expansion in trade, and to this and not to anything they have done is due whatever prosperity there is in this country. I shall leave that


James Clancy: also to hon. gentlemen opposite to settle amongst themselves.
Now, with regard to the value of this preference to England. The Minister of Finance challenged this side of the House, that if we were not in favour of the preference, that the only course left open to us was to introduce a resolution demanding its repeal. I do not think the hon. gentleman (Hon. Mr. Fielding) was sincere in that challenge, nor do I think that on reflection he will consider it a fair challenge. What is the position of affairs to-day ? Why these hon. gentlemen opposite have entered into what we have very properly called a one-sided trade relation with Great Britain ; a trade relation that has not a single redeeming feature, as is shown by the experience we have had of it, a trade relation that imposes $2,000,000 more burden on the people on account of the decreased revenue it brings about, and which $2,000,000 must he recouped from some quarter. The government have entered into this trade relation without getting the slightest return from it. I in my turn will challenge any gentleman opposite to point out some specific instance where Canada benefits today by the preference which we give to Great Britain. It is all very well for the hon. gentlemen to make general statements about this, but let us pin them down to laying their hand upon one example from business experience, in which this country benefits, and they cannot do it. They will tell us : Oh, we have gained the sympathy of Great Britain ; we have touched the hearts of the English people and they are yearning to buy our goods. Well, Sir, it does seem to me that such an argument should not emanate from the brains of sensible men. It is only child's talk for public men to make a pretense of that kind. Why, there is not one man in a thousand in Great Britain who knows that their country has a preference in the Canadian market, and there is not one man in a thousand who cares whether she has a preference or not. The buyer in England will buy the most goods he can for the least money, irrespective of where those goods come from, and the buyer in Canada will do the same thing. We have won our way in the English market on the same conditions as we have won our way in the markets of other countries. Our goods must depend upon their superiority in the market over the goods of other countries, and if we have made England and Germany buy our goods, it is because we are able to produce better and cheaper goods than the people of any other country in the world. These gentlemen opposite now tell us that we have touched the sentimental aspect of this question by giving this preference, but as to that we have the evidence of a gentleman who was very profuse in the session of 1897 with regard to how far sentiment went in Great Britain. That hon. gentleman was then quite as cautious and
quite as prudent as his friends are now 1 never to go beyond a statement of glittering generalities with regard to this ques- : tion. Speaking with regard to the tariff of 1879, which was in force in 1883, the Minis- i ter of Customs (Hon. Mr. Paterson) made this statement, and I want this language 1 placed alongside the language that he and his colleagues are using to-day :
Now let me say, if it would be of any comfort to bon. gentlemen, that in this matter I speak entirely for myself, and I do not attach or never did attach as much importance to the question of imports from Great Britain and the United States respectively as some hon. gentlemen have attached to them.
True, 1 recognize the fact that in England we borrow our money. That her flag floats over us. That her army and navy are pledged to defend us, and therefore it was not exactly the thing that might be called very loyal to Great Britain to put on a tariff that would legislate especially against her. X have gone that far in sentiment, but we all know that in matters of trade there is very little sentiment.
Was that the opinion of hon. gentlemen opposite then ? I would venture to say that every one of them took precisely the same view, and I am bound to say that it was a rational and sensible view-a view which all men would take to-day, if they were not enslaved to circumstances of political advantage.
But we are told that by reason of the preference the people of Canada get cheaper goods. We have been told in the past, and I should not be surprised if we are told again, that by reason of the preference goods coming from other countries than Great Britain are, of necessity, correspondingly reduced in price. That is a broad statement, and demands some examination. Let us take the country to the south of us. Hon. gentlemen who have given any attention to the matter know that there are two distinct fields of operation for the trade of tne United States and the trade of Great Britain. True, there is a common ground on which they met, but it is a small ground. There is a large ground in which the imports from the United States and other countries do not come into competition with the imports from Great Britain. But suppose they did. will any hon. gentleman go so far as to assert that if a gentleman from New York went to purchase a certain kind of goods in London or Manchester, he would have to pay anv more for them than a gentleman from Montreal ? If hon. gentlemen are not prepared to take that ground, then it seems to me they are without any sensible foundation for claiming any advantage for Canada in that respect. Take the case of the United States and Canada. We know that the United States to-day are manufacturing very largely in almost every line of goods that England has to sell. Of course, sometimes a single line of goods not made to any extent in the United States, or a higher grade
of goods, are sometimes purchased in Great Britain, while of other grades of the same goods we buy very large quantities in the United States. For instance, would any hon. gentleman say that where a man buys broadcloth and another buys tweeds, the broadcloth comes into competition with the tweeds ? It is absolute folly, it seems to me, for any hon. gentleman to take a position of that kind.
The Minister of Finance stated this afternoon that we cannot hope to get a preference by huckstering or by demanding a preference, or without England being convinced that it is in her interest to give us a preference. What is the position of the two parties on this matter V One party has given a one-sided preference without any compensation whatever. The other party has demanded, and if it had continued in power and had the control of this country, it would have entered upon a preference, if a preference at all was entered upon, that would have had two sides, and would have commended itself to both countries entering into the contract. Are we to get a preference by hon. gentlemen declaring that it would be madness on the part of England to give us a preference ? Are we to get a preference when we have hon. gentlemen supporting the government declaring that it would be a piece of impudence on the part of Canada to ask a preference ? Read what a gentleman who stands high in the councils of that party has said on the question. The hon. member for North Norfolk (Mr. Charlton)- I am sorry he is not in his place to-nightspeaking on this question last session, and referring to the limited trade Canada had with Great Britain, said :
This is a very small trade relatively, less than 2i per cent of her exports to the world, only one mill In excess of 3h per cent of her exports to foreign countries, 6 8-10 per cent of her exports to British possessions, and yet, we stand up with this comparatively insignificant portion of British trade, and with sublime impudence, ask England to tax herself for the benefit of this little Oliver Twist that is continually calling for more.
Now, I would like to ask how we are to got a preferential trade with Great Britain ? Are we going to get it when we have hon. gentlemen on that side of the House prompted to get up in their places and make statements of that kind ? But the hon. gentleman went further. He said :
If it can be shown, as it can undoubtedly be shown clearly, that the adoption of the policy the hon. gentleman asks for, would impair the prosperity and strength of Great Britain, why, we would be asking, even if we could obtain it, something actually not in our own interest.
The hon. member for North Norfolk not only declared that it was madness to talk of a : preference, but that it was not in the inter, est of Canada to have such a preference.
Well, I believe we are entering upon a peri iod when the statesmen of England must

educate the people of Great Britain in regard to the completely changed circumstances of to-day. The people of that country may be slow to take notice of the rapid changes which are occurring ; but the British manufacturers are becoming justly alarmed at the prospect of the American people driving them out of their own market. We have today an instance of that in the fact that Great Britain, which formerly did nearly all the iron trade of this country, has to-day less than C per cent of it. It is an alarming state of things. There never was a period when there was a better opportunity for the people of Canada and the statesmen of Great Britain to prepare for the changed circumstances, and to realize that nothing short of a trade preference between Great Britain and her colonies can protect the mother country against the evils arising to-day from foreign competition.
But we had another evidence from the hon. member for North Norfolk (Mr. Charlton). He declared in this House, I think upon the same occasion, that we dared not have a preference in England because if Canada obtained preference in Great Britain, we should invite the hostility of her neighbours to the south. Here is what the hon. gentleman had to say :
Her relations with other commercial powers are of such a character that the introduction of such a policy would be fatal to her interests. It would invite retaliation. It would not only invite it. but it would secure retaliation. England would invite disaster that would surely fall upon her if this unreasonable demand were granted to a country which takes but 5 per cent of her exports and sends but 3J per cent of her imports.
In other words Canada sends so small a quantity of exports to Great Britain and purchases so small a quantity of goods from Great Britain, that we dared not enter upon trade preference with each other lest we invite the hostility of the American people. The hon. gentleman, in order to make his case stronger, depicted what he conceived to be the state of feeling in the United States :
We have seen something of the result in the United States. The members of the joint high commission met at every turn that feeling of animosity which exists in the United States in consequence of the adoption of preferential duties of 121 per cent, to be increased to 25 per cent.
Thus the hon. gentleman argues that we dare not enter into closer trade relations with the mother country because, in the first place, that would prevent all possibility of reciprocity with the United States, and in the second place invite commercial hostility that would be dangerous to Great Britain.
We, however, do not propose to be deterred from the policy we deemed essential to the interests of both Canada and the


James Clancy: mother country by these timid imaginings of the hon. gentleman. We propose to call the attention of the people of Great Britain
to the advantages that will flow from closer connections in trade matters, and particularly to the fact that a duty imposed by the mother, country upon the products of foreign countries would not necessarily advance the price to the English consumer. If Canada were admitted to the markets of Great Britain on specially favoured terms, and if foreign products desired to compete against ours, they would have to be sold at the same prices, and consequently the English consumer would not have to pay a farthing more than he otherwise would.
We have been told that the trade with Great Britain has immensely increased under the policy of the present government. Well, I think it will be admitted that the trade with foreign countries from 1898 to 1900 will be a fair index of the accuracy of the hon. gentleman's statement. The* increase of exports in 1900 over 1890. to the following countries, were as follows
Per cent.
Belgium	 1,121
Italy	 359
Australia	  214
Portugal	 H6
France	 136
Germany	 126
Other countries not classified	71
Great Britain	 61
United States	 54
South America	 43
Holland	 34
Newfoundland	 20
This shows conclusively that the sentiment in our favour, of which all these hon. gentlemen are boasting, has had such little effect that Great Britain, as a consumer of Canadian products, stands only eighth upon the list. Take the aggregate trade with foreign countries, and the following are the increases in 1900 over 1896 :
Belgium	 Portugal 	 Holland 		Per cent.
United States 		
Other countries		
France 		
Switzerland 		
Great Britain 		
Germany 		
Spain		
Italy 		
Newfoundland		
This shows again that Great Britain, as a consumer, stands eighth in the list, and I think is conclusive evidence that the position taken by the hon. gentleman is entirely without foundation.
It would be well, in view of the statement made by the hon. Finance Minister this afternoon,' showing the increase by years in trade with Great Britain, that he should give us the corresponding years with
tlie United States. When asked for that information, he replied that he did not have a statement of the trade with the United States during that period.
Let us now compare our trade with the two great trading countries. Great Britain and the United States, in the two periods. First take the exports. The exports to Great Britain increased by a larger percentage than those to the United States. The increase in our exports to Great Britain in 1900, as compared with 1890, was 61 54 per cent, while the increase of our exports to the United States in the same period was 54 34 per cent. On the other hand, our imports from Great Britain increased, in the period I have named, 35 -80 per cent, while our imports from the United States in reased no less than 87 53 per cent. Now, let me compare the aggregate trade with these two countries. Our aggregate trade with Great Britain increased 53 3 per cent, while our aggregate trade with the United States-no inducement offered, no preference given-increased 73-22 per cent. The Finance Minister or hou. genlemen on his side can hardly answer that by merely saying we bought the goods we needed. That was perfectly true, but it only shows that trade will seek the channels of least resistance, and that to the extent that trade goes on each country produces goods that are required by the other. This is further exemplified by the fact that notwithstanding hostile tariffs, our trade with Belgium and Germany has increased by a greater percentage than has our trade with Great Britain.
Now, I shall not detain the House long, but I wish to make some reference to what I consider a very important statement made by the Minister of Finance. I notice that the hon. gentleman had one way of making his calculations up to the present year and another way of making them this year. In making a comparison as to the rate of taxation, he, very fairly, excluded Indian corn, which was imported into Canada and re-exported, for although, appearing in the returns as entered for consumption in Canada, it was well known that this corn was not for Canadian consumption and should not be included. He also excluded coin and bullion, which is usually done in making these calculations. But, perhaps some hon. gentleman on that side can explain why the hon. gentleman excluded coin and bullion in former years and included coin and bullion to-day. In making his comparison this year he includes coin and bullion for all the years covered by his comparison. And why does he do so ? Because to do so tells in favour of his own position, for the quantity of coin and bullion imported into Canada in 1900 was larger than in any previous year, and the effect of including them is to show a reduced percentage of taxation. I do not find fault with the hon. gentleman's previous basis of calculation, and in making up the figures I have followed up the
course which he previously thought the correct one, and have excluded coin and bullion as well as Indian corn, which ought to be excluded, as it merely passed through the country and was not consumed there. I ask your attention to a comparison of the rates of taxation on this basis for the two periods from 1893 to 1896, under Conservative rule, and from 1897 to 1900, under Liberal rule. Take the first period first. In this case, I exclude coin and bullion, but include Indian corn, because under the former tariff corn for consumption was so entered. Here are the percentages of duty actually collected on goods entered for consumption for the years mentioned :
Per cent.
1893		 18-37
1894		 17-76
1895		 17-76
1896		 19-19
Average	 18'28
Now, to take the next period. In this I exclude not only coin and bullion, but also Indian corn, as it was admited free, and that which merely passed through the country was entered as for Canadian consumption :
Per cent.
1897		 18 66
1898		 18-28
1899		 17-92
1900		 17-21
Average	 17-93
Thus we see that there has been a reduction in the duties of just 35-100 of 1 per cent in the period of Liberal rule as compared with those under Conservative rule. This is the immense reduction of which the hon. gentleman boasts. And what would this reduction mean in money ? In round numbers it means $1,800,000. And this is the net result of this preference modification of the national policy as adopted by hon. gentlemen opposite. We never contended that there were no faults in the national policy. Like every tariff, it had its objections, but in the case of the national policy as adopted and carried into effect by the Conservatives, those objections were merely minor ones. While in the main it was a wise policy-the fact that it built up Canada being proof of it. And when hon. gentlemen came into office they pretended to modify it. When he announced his first tariff the Minister of Finance stated in most explicit terms that it would not lower taxation, but he had a special tariff that would lower taxation-the preferential tariff. And this is the effect of that lowering of the tariff- 35-100 of 1 per cent. It is not to be wondered at that the effect of the preferential tariff was so small when we consider that less than 26 per cent of the dutiable goods imported into Canada come in under the preference. I can scarcely find terms adequate to describe a policy of that kind, that

we have to-day the national policy as it was understood in the past, modified according to what hon. gentlemen have stated, by a preference, and under which we have achieved such meagre results.
But hon. gentlemen have not been slow in increasing the taxation. I say that apart from that reduction, they have largely increased the tax upon the people. They have increased the customs rate from 1896 to 1900. In 1890 the customs was $3.94 per head and the excise 63 cents, or a combined taxation of $4.57 per head. In 1900 the customs rate had increased to $5.37 and the excise to 83 cepts, a total of $6.21, or an increase of $1.04 since 1896 upon every man, woman and child in Canada.. Hon. gentlemen may say, perhaps, that is not strictly accurate, that it is open to the objection the Minister of Trade and Commerce has urged upon more than one occasion, namely, the mode of calculating the increase of population. But the hon. gentleman is not in a position to do more than state that the mode of calculation is not accurate. However, whether accurate or not, it applies to both cases, and one side has absolutely no advantage over the other.
Now, let us see what has been the result of this taxation. Take the increase of taxes made since 1896 on tobacco and cigars. The extra taxation has been $1,313,337. We have also an increase on sugar, notwithstanding the position taken by the Minister of Finance when he stated that he was going to give a free breakfast table, that he was going to reduce the duty on refined sugar from $1.14 per hundred pounds to $1, that he was going to allow the duty to remain as it was before at one-half cent a pound on raw sugar. We have an increase in duties on sugar by reason of the law governing the test under which it is imported, of no less a sum than $737,534 more than it was in 1896 under the existing duties. Then we collect an increased duty on rice, another article which tlie hon. gentleman was going to make cheaper ; we collect an additional $26,205. Now, I want to call attention to two facts. One is that by reason of the operation of the preferential tariff, according to the Trade Returns, there has been a reduction of $1,180,325. What have we in the way of increased taxation on other articles ? Take tobacco, that is a luxury perhaps to some extent. but to a great multitude of poor men in this country it is their greatest luxury ; we have an increased taxation upon that, as I have already stated, to the extent of $1,313,000 a year ; in sugar. $737,000 in round numbers ; in rice, $26,000 ; in other words, as against a reduction of $1,180,000. we have an increase of $2,077,466. Surely that is not a very comfortable outlook.
Now, I challenge hon. gentlemen opposite to say that we are not paying, under the proposed reduction of hon. gentlemen made on sugar in 1897, nearly three-quarters of a million dollars more in duties than we paid


James Clancy: in 1896. Then the Minister of Finance stated that we imported goods from the United States because they are raw material. Is sugar not raw material ? If you import iron goods for the purpose of aiding manufactures in this country, and of lowering the price of iron manufactures to the consumers, which was the reason alleged, what is the difference between lowering the duties on raw material that is composed of iron and on raw material that is composed of rice, or sugar, which are necessaries of life ? There is, to my mind, a most contradictory position taken by the Minister of Finance. In one class of raw material the duty is not to be lowered, and in another class i,t is to be lowered, yet in both cases he says they will be equally cheap to the people. Now, by reason of the arrangement of the test under which sugars will be entered for duty, he has laid down a rule by which he takes from the people nearly three-quarters of a million dollars more than was taken in 1896. But what was his declaration in 1897 V He declared that he was lowering the duties on sugar to the extent of $400,000 annually. Has he done that ? I do not think the hon. gentleman will contend that he has done it. I do not think the hon. gentleman will contend that he has not advanced the duties to the extent of nearly three-quarters of a million dollars over 1896. Then I would like to know where are the grounds for congratulation which the hon. gentleman and bis friends claim to possess.
Now, Mr. Speaker, the Minister of Finance claimed some credit for reducing the public debt and for having a great surplus. The hon. gentleman went so far as to say that it was really a very gratifying thing that there should' be a reduction of the public debt under the circumstances. Now, I desire to call his attention to the circumstances under which he reduced the public debt. Sir, the circumstance is that he has taken $52,000,000 out of the pockets of the people, the largest sum that was ever collected from the people of Canada. Yet he congratulates himself that while he takes $14,000,000 more from the people than was taken in 1896, he glorifies himself for having made a slight reduction in the public debt. He says they have a great surplus of $8,000,000. Let us see now whether the hon. gentleman has a surplus or not. In arriving at his surplus of $8,000,000, the hon. gentleman did not include all the expenditures. Now, it is a mere trick, I will not say it has been confined to one side of the House, but it is a trick upon the public to found the statement of a surplus upon the expenditure under consolidated revenue. Our receipts in 1899 were $51,029,994, our expenditures for the same year were $52,717,466. or a deficit between the two sides of the ledger of $1,687,472.
I am quite aware, Mr. Speaker, when I make that statement, that this is not the first occasion upon which a surplus has been counted in that way. But, I wish to call
the attention of hon. gentlemen to the fact that we collected $51,000,000 in 1900, and that we expended $52,000,000. What is the answer of hon. gentlemen opposite ? They say that a part of this should be charged to capital account. That is not a fair answer. A fair statement is that we spent more money than we collected; that we made the largest collection that was ever made in Canada, that we made the largest expenditure on the other hand, and, instead of having upon the whole transaction, namely, the sums of money that were spent on capital as well as the sums that were chargeable to consolidated revenue, a surplus, we have, in round numbers $1,087,000 of a deficit. I think that is a fair way of putting it, and if hon. gentlemen boast of that kind of thing, 1 do not think there is very much credit due them. If hon. gentlemen were able to say: We have only charged to capital account such items as properly belong to it, we have not unloaded on capital account for the pur, pose of having a surplus they would be able to make a creditable showing. But, hon. gentlemen, as they have done in connection with the Intercolonial Railway, require to charge endless expenditures to capital account in order to show a surplus. The Minister of Railways and Canals (Hon. Mr. Blair) could have a surplus to such an extent as suits his sweet will by adopting that course. He could charge services to capital account which did not properly belong to capital account as was shown in a debate in this House during last session. It was then shown that he had charged to capital account expenditures in connection with services that had never been so charged before. I do not say that the hon. Minister of Finance is doing that, but, if the expenditures on the Intercolonial Railway which were charged to capital account, form part of that surplus of $8,000,000 it shows how much there is to support the claim of such a surplus. The fact is that hon. gentlemen have paid out over $1,500,000 more than they collected, although the sum collected was very large. Ass to the attitude of hon. gentlemen upon this question in the past I shall not dwell. We have had the spectacle of hon. gentlemen going to the people with one set of professions and coming back and acting on an entirely different set. They have proclaimed that they have a revenue tariff and that they are able to collect $51.000.000 with a surplus of $8,000,000 under that tariff. The very thing that hon. gentlemen declared against in the past. Hon. gentlemen went to the country and declared against the national policy, but, what was the attitude of hon. gentlemen in the past. I suppose I may acquit the hon. Minister of Trade and Commerce. He was fortunately silent but the right hon. First Minister was not silent in his early history in regard to being a protectionist. He was
a protectionist in the movement which took place in the province of Quebec in 1870, when the national party was formed. The right hon. gentleman was a member of the legislature of Quebec at that time, and he joined in the movement for protection to the industries of Canada. That was the attitude of the right lion, gentleman upon that occasion. Then, I will take the hon. member for North Norfolk (Mr. Charlton). I am sorry he is not here to-night, because he was very pronounced upon the question of protection. This is what the hon. gentleman had to say before the national policy was adopted in 1878 :
I believe that the interests of the nation at large would be promoted by judicial protection.
I believe that the agricultural industries of the Dominion would be promoted by protection and that the manufacturers, being brought to the door of the farmer, would afford a market for a great many articles that would not be saleable if the market were 3,000 miles away. With a home market of this kind established by protection to manufacturers the agriculturists can benefit by producing a rotation of crops.	'
The right hon. First Minister, although not a member of this House at that time


The MINISTER OF TRADE AND COMMERCE (Hon. Sir Richard Cartwright).: My hon. friend (Mr. Clancy) is mistaken. The Prime Minister was it member of this House in 1876, and he entered the government of Mr. Mackenzie in 1876 or 1877-I forget which.


The PRIME MINISTER.: In 1877.
Mr. CLANCY, Quite so, but before he came into this House, he had in his province in which he was a distinguished member of the legislature, in which he was a prominent and leading mind in what was known ns the national party, said that he favoured protection to Canadian industries. It is a matter of little consequence whether lie was a member of this House in 187(5. or whether he made the statement upon that occasion or prior to that. The point I am endeavouring to make is that the right lion, gentleman at one time in his life did look favourably upon protection to Canadian industries. Now. we will take the hon. Minister of Customs (Hon. Mr. Paterson) who also entertained a view of that kind. He said :
I must admit that I am in favour of a defensive policy. I cannot view with complacency what we see in this country. We live beside a country with a population ten times greater than our own whose industries have been fostered by protection until they are enabled even in some articles in which Great Britain excels, to challenge supremacy with her. While that nation has erected against us and other countries a hostile tariff, we have our hands bound and give them free and unrestricted rights of trade in our market.
There can be no doubt about the tone of

that speech. That speech was made before the tariff was introduced in 1879. Now, I am going to acquit the lion. Minister of Trade and Commerce of having committed himself, so far as he can be traced, to statements of that kind, but the hon. gentleman had it in his desk. The hon. gentleman believed in protection. There is no doubt about that and I challenge the hon. gentleman to say that he did not believe in protection.


The MINISTER OF TRADE AND COMMERCE.: When 1


James Clancy: I will show the hon. gentleman when he believed in protection. We have the right hon. Prime Minister who is very candid sometimes, and I sun going to call one of the most respectable witnesses in Canada to prove that the hon. Minister of Trade and Commerce was favourable to protection. He is a distinguished member to the party to which he belongs, an hon. gentleman who has done great service to his party, and I am bound to admit that the hon. gentleman with his ability could not fail to perform some service to his country whether we quite agree with the attitude he has maintained during his long years of service or not. But, at a public dinner, given to the hon. gentleman on the 10th of May, 1900, in this city, what was said ? We have an hon. gentleman who rose, not late in the evening, I presume, not at that period when men are influenced or moved by the spirit, but at that sober period when men feel quite candid and the right hon. gentleman was extremely candid. He was referring to the hon. Minister of Trade and Commerce when he said :
There never was a day of the many days since we had to discuss questions together in council but I could count and rely on the support of Sir Richard Cartwright; and though, as sometimes happens in the councils of the party, we did not agree when in council, when the policy of the party was agreed upon, Sir Richard Cartwright never wavered in his support of it. I will give you an instance which has come to me from reliable sources, and is a thing which goes far to show the character of the guest of the evening.
Mark the words, Mr. Speaker : the 'character ' of the guest of the evening. I want the Minister of Trade and Commerce. (Hon. 'Sir Richard Cartwright) to note what follows ;
In the days of Mr. Mackenzie, when the country was very much depressed, there were many who believed that if the tariff was increased, that policy would be justified by the necessities of the revenue, and that it would be a valuable policy for the country at large. I can give you the story without betraying secrets, because these things happened before my day, but if the advice of Sir Richard Cartwright had prevailed at that time this policy would have been adopted.
That is the time when the hon. gentleman (Hon. Sir Richard Cartwright) had it in his heart. There is more :


James Clancy: If it was not accepted, it was on account of other influences which prevailed with the government of the day, and for sixteen or twenty years Sir Richard Cartwright bore the brunt of the obloquy of not having responded to public sentiment, whereas the truth was that he was ready to respond to public sentiment. For eighteen years he bore the brunt of all the obloquy and never whispered a word. It is not every day you can find such abnegation and such loyalty to the party, and I have reasons to believe and to repeat it to you, I not only repeat it to you my colleagues, but wish my words to be heard all over Canada, that Canada little knows the debt of gratitude it owes to Sir Richard Cartwright.
Now, Mr. Speaker, by a very easy translation, wbat does this mean ? It means that in 1878, when the Liberal party went to the country, when the hon. gentleman cried out against protection himself, that he had it in his heart and was a believer in protection.


The MINISTER OF TRADE AND COMMERCE (Hon. Sir Richard Cartwright).: By no manner of means. I have no objection to tell the hon. gentleman (Mr. Clancy). what happened, if he will permit me. For revenue purposes, and for revenue purposes alone, I advised in 1876-the thing is public property-I advised, as is perfectly well known on both sides of the House, an increase of the taxation to about 20 per cent, but it had nothing in the world to do with the question of protection. It was done because there was a deficit or impending deficit. It was done for revenue purposes.


James Clancy: If that be so, the hon. gentleman (Hon. Sir Richard Cartwright) has done his leader manifest injustice. Did the First Minister state the truth or was he doing the Minister of Trade and Commerce ar. injustice ? Why, Sir, the very position that was taken afterwards by the hon. gentleman (Hon. Sir Richard Cartwright) shows it. When his colleagues knew that 'he wanted and believed in protective tariffs-to use plain English as it is understood in Canada


The MINISTER OF TRADE AND COMMERCE.: Not protective tariff ; revenue tariff.


James Clancy: The hon. gentleman and his leader will have to settle the question of ' revenue ' and ' protection ' between themselves. The First Minister has put himself on record on that question, and the country will believe the First Minister. The hon. gentleman (Sir Richard Cartwright) who was known to his colleagues to have favoured at least a considerable amount of protection, put himself on record in 1890. I want to show the position of that hon. gentleman (Sir Richard Cartwright) at the two periods in order to see how he stands before the world. He said in 1890 :
I say our protective system was a huge mistake, in so far as it was honest at all, and
in so far as it was not honest, it was a huge scheme of robbery. A small ring clique of combines and protected manufacturers have, as I have told you, been permitted for years to make a prize and plunder of the people of Canada. I stand by the declaration I have made that protection is nothing more or less than deliberate legalized and organized robbery, and more than that, if you do not stamp it out, it is the very high road to political slavery first, and industrial slavery afterwards. Our policy from first to last has been to destroy the villainous system of protection by free trade. Revenue tariff or continental free trade.
That is the position the hon. gentleman occupied during these whole years, when he did what ? When, to use the words of the right hon. the Prime Minister, he bore the brunt of obloquy for not responding to public opinion, and when he bore it in silence and did not dare to act upon the dictates of his own conscience. And what happened ? Notwithstanding that the Minister of Trade and Commerce (Sir Richard Cartwright) went to his own constituency before the elections of 1896 and declared that if his party were returned to power he would be Finance Minister ; notwithstanding that, he is sentenced to sit at the feet of the present Finance Minister (Hon. Mr. Fielding). And why was that done ? It was done for the reason that was disclosed in the First Minister's speech, who in the most extraordiaary manner at a public dinner felt constrained to disclose the sad picture of Sir Richard Cartwright for eighteen or twenty years bearing in silence the brunt of obloquy because he did not respond to public opinion, I shall not dwell on that further ; I shall leave it for the public to pronounce judgment upon it. We have here to-day a set of gentlemen in office who have gone back on every profession they have made. The hon. member for North Norfolk (Mr. Charlton) laid down the political moral code of hon. gentlemen opposite before the elections of 1890. Speaking at Bracebridge for the Liberal leaders, and hoping at that time to be a minister himself, he used the language which I shall quote. The hon. gentleman (Mr. Charlton) too, has been set aside, and I am not sure that he is not having his revenge in some quarters, X am not sure that he is not giving evidence to the people of Canada that he is not quite pleased with the treatment he received. Mr. Charlton said at Bracebridge :
In concluding his speech he told the audience what the Liberal party will do when they get into office. We will stop going into debt.
Well, the government have not done that. Why, Sir, we have had a declaration even this afternoon from the Finance Minister that, notwithstanding they claim a surplus of $8,000,000 ; we had the declaration from the Finance Minister this afternoon that the government claimed a surplus of $8,000,000 odd ; the revenue collected from the
people in the form of taxation is said to be $52,000,000 in the present year; and we have the announcement from the Finance Minister that, notwithstanding that fact, he proposes to run into debt during the present year to the amount of nearly $2,000,000. This is what the hon. member for North Norfolk said on that occasion :
We will stop going into debt. We will adopt principles ot honesty and economy.
Leaving aside the very difficult and irritating question as to honesty, where is the economy ?
We will out down the annual expenditures by four or five millions of dollars. We will bring about prosperity to the farmers by promoting reciprocal trade relations with their natural market.
Namely, that of the United States. Has that been done ? And lastly :
We will have the same code for public as for private morals.
It is fair to say, Mr. Speaker, that that was too refined altogether for the hon. gentlemen. No wonder my hon. friend said that a gentleman committing a party to a position of that kind, should be consigned to the place he holds to-day.
I say we can well afford to leave this matter to the judgment of public opinion. We have hon. gentlemen here to-day occupying a position just the opposite of that which they occupied before. We have hon. gentlemen declaring that wTe have no protection, when we have a protective tariff. With regard to our position on the question of the one-sided preference and the challenge the Finance Minister made this afternoon on the subject of the preference, I am speaking for myself entirely when I say that it is not the business of the Conservative party to repeal a one-sided, silly and senseless preference which hon. gentlemen opposite adopt ; but it is the business of the Conservative party to undo by all rational means the mistakes and misdeeds of hon. gentlemen opposite. The policy of the Conservative party is to educate our own people and the people of Great Britain too ; because I think the speeches made in this House are not without effect on public sentiment in Great Britain. We have gentlemen in this House capable of pointing out the immense advantages that would inure to the British Empire from trade relations carried on within the empire, as against every other country in the world. Is that not a reasonable and rational proposition which will commend itself to public sentiment in Great Britain ? We must help to educate the people of Great Britain to see the advantage of a condition of things that would be of mutual benefit to the people of Great Britain and to the people of Canada. But I despair, as the people of this country have reason to despair, of the consummation of

that great achievement for Canada and the empire-and it will be a great achievement when it is brought about, as I hope it will be in the near future-so long as we have hon. gentlemen on that side of the House declaring that the people of Great Britain would be madmen and fools if they assented to anything of the sort.
This is, in short, the difference between the two parties on this question. We believe that this country has a great future as a part of the British Empire; but we believe it has a future and destiny of its own that warrants it in having a fiscal policy of its own. We believe we are not called upon to go to another country and say, We will give you this for the pleasure of taxing people who are already impoverished by taxation. I challenge hon. gentlemen opposite to lay their finger on a single feature that can be urged on behalf of the present preference. What were the declarations made by the Liberal party in 1896 and laid down in the platform adopted in their convention in 1893 ? To reduce taxation on the necessaries of life. As the only modifying feature of what is to-day a decidedly protective tariff-and I am not finding fault with it on that ground-we have the preference which covers less (than 26 per cent of all the dutiable goods imported into Canada. In that 26 per cent do the necessaries of life come in on more favourable terms than the luxuries ? No, Sir ; there is that fatal cut which admits all the luxuries of life on the same ground as the most pressing necessaries. Then, I ask hon. gentlemen where are the modifying features of this tariff to show that they carried out their pledge of 1896 to lighten the burden of taxation on the necessaries of life ? I will not say that there are not some cases, but they are so trivial and unimportant that they amount to nothing in the way of reducing the taxation. Now, I repeat that while our attachment to Great Britain needs not the proof of this one-sided policy, the people of this country have shown, when the occasion has arisen, that they need give no such proof of their loyalty to the mother country. There are no dollars and cents in it. If we had to prove our loyalty to the mother country by concessions on the basis of dollars and cents, that would be the lowest ground on which we could put it. I repeat, that while we have an interest and a destiny which is inseparable from Great Britain and which we do not desire to have separated, we have a future of our own ; and I believe that the best way we can serve the interests of the empire is by making our own country great and prosperous.


The MINISTER OF TRADE AND COMMERCE (Hon. Sir Richard Cartwright).: Mr. Speaker, it is not my purpose to inflict .a fourth financial speech on the House to-Mr. CLANCY.
night. Three are, I think, as much as the average digestion of ordinary members of parliament can very well endure ; and, therefore, with the assent of hon. gentlemen, I would move the adjournment of the debate.


Mr. BORDEN (Halifax).: Might I ask when it is proposed to resume the debate-to-morrow or Monday ?


The MINISTER OF TRADE AND COMMERCE.: To-morrow.


Robert Laird Borden: Will it proceed from day to day ?


The PRIME MINISTER.: We shall be glad to consult the convenience of hon. gentlemen on that point.


[Stage Direction]
Motion agreed to, and debate adjourned.
On motion of the Prime Minister, House adjourned at 9.30 p.m.
[Stage Direction]
Friday, March 15, 1901.