1923-05-18

JAPANESE IMMIGRATION


Mr. SPEAKER:: I have the honour to
inform the House that the Clerk of Petitions reports that he has examined the petition of W. J. Bartlett and others, of Vancouver and other places in British Columbia. The attention of the House is directed to the fact that the said petition is irregular in that it is addressed to the Right Honourable William Lyon Mackenzie King and the members of the government of Canada, and not to the House of Commons in Parliament assembled, and as it does not contain three signatures on the sheet containing the prayer of the petition, as required by rule 75, it should not be received.


Mr. McQUARRIE:: May I ask that the
petition be returned to me so that I can send it to the petitioners?


Hewitt Bostock: If the hon. member will
make a motion to that effect at a subsequent sitting-or, by unanimous consent at this sitting-the petition will be returned to him.


William Garland McQuarrie: I will move that, Mr. Speaker.


Hewitt Bostock: By unanimous consent. Motion agreed to.



LAKE OF THE WOODS REGULATION

[Stage Direction]
Sir LOMER GOUIN (Minister of Justice) moved for leave to introduce Bill No. 175, to repeal The Lake of the Woods Regulation Act, 1921.	.
He said: This is a similar bill to one which was introduced at the last session by the then Solicitor General. It is in regard to the control of the Lake of the Woods, the Winnipeg and English rivers and Lac Seul. As hon. gentlemen will remember, some time before the session of 1921 an agreement was arrived at between the federal government and the government of Ontario to the effect that the control of these lakes and rivers should be given to a board composed of four members, two appointed by the federal government and two by the Ontario government. This arrangement was put into force by orders in council passed by the two governments, which in turn with the agreement, were to be confirmed and ratified by this parliament and by the legislature of Ontario. In accordance with that agreement a bill was introduced and passed in this House, and it is now on the statute book as chapter 10 of the acts of 1921. ^ The government of Ontario introduced a similar bill but the House prorogued before there was time to pass the measure. In these circumstances the government of Canada thought it wise that federal legislation in the matter should be enacted without delay, so chapter 38 of the statutes of 1921 was passed, giving the Canadian government control of the Lake of the Woods, the Winnipeg and English rivers and Lac Seul. It was also provided by that statute that whenever the province of Ontario should legislate in accordance with the arrangement made, the Governor in Council should repeal chapter 38 of the statutes of 1921. We now propose by this bill as it was last year to repeal purely and simply chapter 38 and for this reason: In addition to what I have said, there was a clause in that chapter to the effect that while the Governor in Council would have a right to repeal the statute, this would not affect a certain clause in virtue of which it was declared that all these works around the Lake of the Woods and the different rivers mentioned were for the general advantage of Canada. It has been represented to us that this was not the agreement, and that the two parties, the government of Canada and the province of On-
[Stage Direction]
Labour and Organization
tario, should be put in exactly the same position as they were when the arrangement was agreed upon and signed. That is the reason why we now repeat this same legislation. I may say that the bill last year, while it passed this House, was not assented to by the Senate.
Mr. MEIGHEN:: May I ask, what is the attitude of the present government of Manitoba toward this bill?
right of any Canadian worker to join a legitimate trade union if he so desires.


Hewitt Bostock: I may say that the motion comes under Rule 39. It is certainly a definite matter of urgent public importance. However, subsection (4) of Rule 39 says:
He (the mover) then hands a written statement of the matter proposed to be discussed to the Speaker, who, if he thinks it in order, reads it out and asks whether the member has the leave of the House.


Sir LOMER GOUIN:: I think that the government of Manitoba will be satisfied with the bill if it passes as introduced.
u Mr- MEIGHEN: My hon. friend says he thinks" so. Has he had word from the government of Manitoba to that effect?


Lomer Gouin: I may say that there is an agreement among the three parties, that is, the Canadian government, the province of Ontario, and the province of Manitoba, that when certain conditions have been fulfilled by the province of Ontario the province of Manitoba will be willing and will consent to the passing of this legislation.
Motion agreed to and bill read the first time.
Has the hon. member the leave of the House to introduce said motion?
Some hon. members: Aye.
M'. SPEAKER: The rule goes on:
If objection is taken, the Speaker requests those members who support the motion to rise in their places and, if more than twenty members rise accordingly, the Speaker calls upon the member who has asked for leave.
I take it that more than twenty members said "Aye." The hon. gentleman may proceed.


Mr. NEILL:: This matter has been brought up so hurriedly that I have not had time to provide full data on the subject, but the facts are so outstanding that they almost speak for themselves.



PRIVATE BILLS FIRST READINGS

[Stage Direction]
r'J1	l71 (fr°m the Senate), for the
relief of Gladys Teague.-Mr. Garland (Carle-ton).
172 (from the Senate), for the relief of Elizabeth McKinley.

Mr. Chew.
Bill No. 173 (from the Senate), for the relief of Algernon Cecil Aubry Moran.-Mr Baxter.
Bill No. 174 (from the Senate), for the relief of Emily Adlene McCausland.-Mr. Boys.


[Stage Direction]
On the Orders of the Day:
Alan Webster Neill: Mr. Speaker, may I ask leave to move the adjournment of the House for the purpose of discussing a definite matter of urgent public importance, namely the notification by the management of the Powell River Paper Company to the members of the local union of paper makers in their employ that unless they surrender their charter by Sunday the 20th instant all members of the union in their employ will be discharged, this action in the absence of any strike, threatened strike or labour trouble constituting an attack on the 
Ihe Jrowell Kiver Company is a large paper manufacturing company on the coast, about one hundred miles north of Vancouver. It is one of those places called a company town-site, that is, the company obtained a town-site, put up their works, and are the exclusive owners of the townsite with the exception of one small block which is owned by a Chinaman. The effect of this is that the company practically controls everyone -who lives and speaks or even thinks in that town. I wish to give full credit where credit is due. The town is very well run from the point of view of labour conditions, that is, the living conditions are satisfactory, the houses are quite properly built, the sanitary conditions excellent, and the light and water satisfactory. The houses are furnished to the company's workers at a very reasonable rental. There is nothing to complain of in that respect at all. I wish to give credit where credit is due, but unfortunately the company have the idea-it is an American company, under alien management and with alien capital-which is prevalent in some sections of the States that the workingman is practically a chattel, and they not only have the people in that town working for them but they wish to think for them. I am not exaggerating because I know the circumstances. I know a case where a man went as a delegate to a political convention and was promptly discharged for that reason. I know another case where a min-

Labour and Organization
ister of the gospel was accused of being too democratic in the views of Christian democracy that he preached, and that man-he was not fired for they do not fire parsons, but he was notified that his house was required for some other purpose. The parson was willing to stay, and his congregation were willing to keep him, but that man had to sever his connection with that church because the views of Christian democracy that he preached there were not acceptable to the management of the town. I am only saying this by way of illustration to give the House an idea of the attitude of the management towards the people of that town. The company, of course, is largely employed in making paper, and there is a paper makers' union, a trades union, in that town, and the union has been languishing a great deal because since labour conditions got hard, the union was frowned upon by the management, and the only place they could hold their meetings was in this Chinese block that I mentioned before. The company was unable to get this Chinaman to move. He had bought the block before the company acquired their property. The officials of this organization were notified about a month ago that their services would be dispensed with. Every official of that union was discharged and their places were taken by somebody else. Now the members of this trade union have been notified that unless they surrender-that is the word used-before next Sunday their charter, that is-go out of business entirely-that is what it amounts to exactly- all the members of the union there will be discharged. I wish to state that my information further says that there is no strike or threatened strike, and there is no labour trouble of any description. It is simply that the employers and the organization of employers take the stand that they will prevent, so far as they are able, labour from organizing in their particular way.
Now, I thought the time had long gone past in this day and generation, when it would be necessary for me or anybody else in this House to rise and defend the rights of ordinary labour to organize for their own protection and in a thoroughly legitimate way. But it appears that there is a reactionary sentiment which always crops up in this country and which is very much alert. Not only is it unjust but it is a very bad policy to treat trade unionism in this way because trade unionism is the bulwark of society against Bolshevism. Certain people may not think that, but it is the case. Wherever there is a genuine trade union you will always find it opposed to any suggestion of Bolshevism. There is some kind of an international union which is affiliated with the Bolshevists of Moscow, but that is not supported or endorsed by the genuine trade union-in fact the most bitter conflicts take place between the genuine trade unions and the Bolshevist. Therefore, I am justified in saying that when these organizations of genuine working men get together for their own improvement or benefit they should be encouraged rather than frowned upon. They are the future bulwark, as I have said, against Bolshevism. And what do you suppose these men will become if they are compelled to surrender their charter on this occasion, or if they are thrown out of their homes and employment in consequence of this action on the part of the employers? What will be the next step in the political affiliations of these men? They will become Bolshevists and I would not blame them if they did.
I would like to point out that as far back as 1918 the late government passed an order in council, No. 7,143, on the 11th July, in which there is what is called a declaration of a war labour policy. I grant you it says a war labour policy. Conditions were very unsettled then. Indeed we did not know from day to day what steps or what attitude labour might take. It was very urgent that labour should, in plain language, be conciliated, and the Dominion government very properly stepped in and pronounced, so to speak, or declared, what they considered was a proper war labour policy to be followed not only by the Dominion but by the employers on the one hand and the employees on the other. They formulated practically a policy for better mutual relations which they endeavoured to induce the two parties to adopt voluntarily as between labour and their employers. The second condition reads as follows:
That all employees have the right to organize in trade unions, and this right shall not be denied or interfered with in any manner whatsoever, and through their chosen representatives shali be permitted and encouraged to negotiate with employers concerning working conditions, rates of pay, and other grievances.
I do not believe there is one per cent of the employers of Canada who do not subscribe to that declaration, and who do not prefer to see trade unions in their neighbourhood so that they can deal with their representatives in all matters of dispute. If that was good law or sound policy for the government to adopt in 1918 it cannot be very far off what is just and fair to-day, and there is the whole question in a nutshell. I simply ask protection for these men in their iegitimate rights to organize-not for strikes, or anything of that kind, there is no strike, but simply the right to organize.
Labour and Organization

I may say that this industry is not without obligations to the Dominion government. They get very substantial proteeticn-my hon. friends to the left of me will be glad to know -ranging from 15 per cent to 35 pel cent; and I may say that my information is that during the war the production of their paper was costing them $32 a ton and it was selling in the neighbourhood of from $90 to $160 a ton. Today conditions are different. The price of paper now will probably run-under the present conditions of manufacture because they have got modern appliances-about $25 a ton and the selling price of paper is somewhere from $60 to $65. So that the protection this industry is getting from the Dominion government affords these manufacturers at least a very adequate measure of protection, being the difference between $25, or say $27, and $65 a ton. Therefore they could well afford to lend some ear to the government if they interfere on behalf of these working men. In the present case I feel like adopting the remarks of the hon. member for South York (Mr. Maclean.) the other day when he suggested that the way to solve the question of the enhanced price of sugar was to give the refiners twenty-four hours to come down in their rates or they would see the effect in the budget. Perhaps it is not too late to insert an amendment in the budget which would solve this situation also.
Mr. WILLIAM IRVINE (Calgary East); I do not think it is necessary for anyone to make a speech at any great length on the question. It seems to me that it is a simple question and the issue very clear. I wish to say, in the first place, that the labour men concerned in this difficulty, as well as the whole labour movement in Canada, are indebted to the hon. member for Comox-Albemi for having brought this matter to the attention of the government and the House. I think that from his presentation of the case it is an attempt being made by the employers concerned to prevent labour from organizing. They have given an ultimatum to the men that before next Sunday they must surrender their charter or leave the job. The men concerned are not very likely to give up without a struggle. Not only so, but the principle underlying this ultimatum involves the whole labour movement in Canada, and I do not suppose that organized labour as a whole would be willing to quietly sit by and see the principle upon which they are organized challenged in this way, knowing that if it is surrendered in the one instance it may be surrendered in other instances, and that ulti-
mately there will be no labour organization at all. So that, in the interests of the country at large as well as in the interests of labour, I hope the government will take whatever steps may be in its power to put this matter right. There is no doubt that if this thing is allowed to go on-and the government, I presume, has the power to do something to prevent it

unrest will follow. I do not, of course, anticipate that the government will take any attitude that will be detrimental to the interests of labour in this case. On the contrary, I quite assume that it will do the fair thing. I am not clear as to what exactly the government has it in its power to do in this connection. However, I have no doubt the Minister of Labour (Mr. Murdock) will make that clear to us. I would conclude by urging that in the interests of the general public and in the interests of the labour movement as a whole-seeing that their right to organize has been threatened in this highhanded manner-the government will take whatever steps are in its power to prevent this thing being put through.


Mr. FRED STORK (Skeena):: I wish to
endorse what the hon. member for Comox-Alberni has said. This is the natural outcome, as I see it, of the "closed town" system as we know it in British Columbia. It is what might be expected from the system that has prevailed there of recent years. There are in my constituency several towns which are entirely manufacturing centres, but they are owned and controlled absolutely by the company which operates the industry. These companies have prevented anyone else from coming in; they have a complete air-tight monopoly. The system has been imported from some of the American states. Some years ago it was in vogue in Montana and other states where they had industrial centres that were owned and controlled entirely by the mining corporation. To the people of the United States it proved to be a very irksome system and they wiped it out there. Apparently the American manufacturer coming over to Canada has brought this system with him, and we find to-day in British Columbia quite a number of centres, as the hon. member for Comox-Alberni has mentioned, where the industrial corporation completely controls the whole situation. The men who are on their payroll are entirely under the jurisdiction of the company. In my estimation, Mr. Speaker, that does not make for good citizenship. A situation in which a man labouring for a corporation in which he has no voice of his own, in which to a very great extent he is precluded from

taking part in public discussion, where he is prevented from exercising his own free will as a citizen, and prevented from joining anything he wants to join, cannot make for the wellbeing and prosperity of the Dominion. I am of the opinion that we have the power to very much curtail this system. This is a matter which has received some attention from former provincial governments, but up to the present time no action has been taken. When a company policeman can meet the incoming boat, and tell any man who steps off the boat that his presence is not required there, that is a condition which should not obtain in any British free country. We find that these corporations enjoy the benefit of police, they enjoy the benefit of post office and custom houses. I agree that some attention should be given to this matter. In accordance with the suggestion of the hon. member for South York (Mr. Maclean, in regard to sugar, it might be well to serve notice that if people are going to endeavour to carry on the feudal system in Canada they should not expect to make use of governmental services and all our modern public utilities.


Hon. JAMES MURDOCK (Minister of Labour):: The Labour department has received no official advice in regard to the particular question referred to by the hon. member for Comox-Albemi (Mr. Neill), although this morning he mentioned the advice that had been received by him from British Columbia, and this afternoon he sent across the floor of the House for my perusal the telegram which he had received. As indicated by the hon. member for Calgary East (Mr. Irvine), it is rather uncertain what this government or this parliament or the Labour department might do in regard to the situation referred to. Many hon. members in this House, I think- and I know very many people outside of parliament-are of the opinion that the Industrial Disputes Investigation Act is intended to maintain some timely supervision and authoritative control over such a matter as the one we are discussing. But that is hardly the case, as the Industrial Disputes Investigation Act only assumes to maintain some reasonable timely supervision over certain possible industrial controversies in what might be regarded as public utilities, chiefly railroads, mining and certain municipal undertakings, and even in regard to the latter it has been found necessary to secure the concurrence of the civic authorities and the workmen before the Labour department undertakes to give assistance in ironing out the disputes.
Labour and Organization
I hope no hon. member of this House would have any doubt as to where I, as Minister of Labour, stand on a matter of this kind. I belong to a labour organization, and have belonged to that organization for more than thirty years. I officially represented a labour organization for more than twenty years and have been confronted, not once but many times in the years gone by, when acting on behalf of the employees with the statement, "We recognize no organization and do not propose to deal with anyone representing an organization". Therefore, the particular question that we have under consideration to-day is not by any means a new thought to me. However, during the past few years I believed that times had materially changed, both immediately prior to the war, and especially during and immediately after the war, and I believed that the general world sentiment conceded to labour certain inalienable rights that had been in the ages gone by conceded to the employer, to industrial captains, or others, throughout Canada-yea and throughout the world. I am not going to rely on, or to press, my personal judgment in regard to the position that I think should obtain in a matter of this kind, but I am going to refer to some decisions that have been made by higher authorities and I think it would not be improper to refer to the position taken at Versailles when the general principles were enunciated as the labour features of the Treaty of Peace. It is not necessary to read them in their entirety, but to read those principles as enunciated which bear particularly upon this question that the hon. member for Comox-Alberni has brought before the House. It is stated-
Among these methods and principles the following seem to the High Contracting Parties to be of special and urgent importance:
First, the guiding principle above enunciated that labour should not be regarded merely as a commodity or article of commerce.
Second, the right of association for all lawful purposes by the employed as well as by the employers.
That is the view on this particular question before the House that was taken at Versailles when the Treaty of Peace was being dealt with. But to come more closely to home, might I suggest that in 1919 the government then in office appointed a royal commission on industrial relations, and that royal commission travelled throughout the length and breadth of Canada from Vancouver, British Columbia to Sydney, Nova Scotia, and interviewed employers and workmen and representatives of the great public interests on the question of maintaining harmony and co-operation
2S90
Labour and Organization

between employer and employee. That royal commission made a report, and I want to quote a portion of that report, as bearing directly upon the particular question that we are considering. I might say that what I am going to read deals with some other phases that we are not at the moment considering; but I think it is necessary to read it in this way so as to give the complete text and to couple up the portion that has a direct bearing upon the matter under consideration:
The chief causes of unrest may be enumerated as follows:
1.	Unemployment and the fear of unemployment.
2.	High cost of living in relation to wages and the desire of the worker for a larger share of the product of his labour.
3.	Desire for shorter hours of labour.
4.	Denial of the right to organize and refusal to recognize Unions.
5.	Denial of collective bargaining.
6.	Lack of confidence in constituted government.
7.	Insufficient and poor housing.
8.	Restrictions upon the freedom of speech and press.
9.	Ostentatious display of wealth.
10.	Lack of equal educational opportunities.
Paragraph 54 reads:
Employers may be divided into three classes: (1) Those who deny the right of their employees to organize and who actively take steps to prevent such organizations; (2) those who, while not denying that right of their employees to organize, refuse to recognize organization among their employees, and persist in dealing with them as individuals, or as committees of employees, without regard to their affiliation with the organization; and (3) those who not only admit the right to their employees to organize, but recognize and bargain with the organization on behalf of their employees.
Paragraph 55 reads:
There are not many employers in Canada who belong to the first class, but there are a very large number who belong to the second class. The employers who openly object to their employees organizing are not many, but, rightly or wrongly, the workers believe that numbers of employers who openly declare their willingness that their employees should organize, covertly interpose obstacles in the way of their doing so, and that employees who are active in organizing their fellows into trade unions are got rid of, or penalized in some other way. To the third class belong the great railway, telegraph and mining companies and many building trades. Outside of these, the employers of labour who recognize and deal with organized labour as such are in the minority.
Paragraph 56 reads:
The government of Canada, by order in council passed in July, 1918, make a declaration of policy with respect to organizing.	One clause of this order an
council provided that	"all employees have a right
to organize in trade unions, and this right shall not be denied or interfered with in any manner whatsoever, and through thbir chosen representatives they should be permitted and encouraged to negotiate with employers concerning working conditions, rates of pay, and other grievances."
There is a great deal more of this report of the Royal Commission on Industrial Re-

lations that might be read, but I think that is sufficient to indicate the position that was taken by that commission after having investigated the underlying causes of unrest, and of the dissension and disputes occurring between Capital and Labour, between employer and employee, throughout the length and breadth of Canada. As a result of that report a conference was held at Ottawa in the fall of 1919, that conference being known as the National Industrial Conference. It was made up of representatives of important employing interests and important labour organizations throughout the Dominion of Canada, and remained in session for several days. That conference appointed certain committees of employees and like committees of employers to deal with certain questions, amongst them item No. 4 of the agenda respecting the right to organize, recognition of labour unions and the right of collective bargaining. It is only proper to say that these committees of workers and of employers did not reach a mutually satisfactory settlement of their differences of opinion. In other words, the conference adopted no general declaration as the result of those two committees' meeting. But it is at least fair to read what the employers' committee reported to that conference, because, if the position taken by that employers' committee had been recognized by the paper company at Powell river, we would not at this moment be considering the particular question that is before the House. The employers' report reads:
Your committee recommend that:
(a)	Employers admit the right of employees to join any lawful organization.
(b)	Employers should not be required to recognize unions or to establish "closed Shops".
Employers insist on the right, when so desired, to maintain their plants as "open shops", by which they mean that no employer should discriminate against any employee because of the latter's membership or nonmembership in any organization, and no employee should interfere with any other employee, because of the latter's membership or non-membership in any organization.
(c)	Employers should not be requ red to negotiate except directly, with their own employees or groups of their own employees.
This is signed for the employers' section by the three representatives of the employers who were appointed on that committee.
I do not want it to be understood in any way that I am subscribing to just what has been written, but the position I take is that even the employers at that National Industrial Conference conceded the right of employees to organize, and it is indeed passing strange that we find, at various points in Canada to-day, some four or five years after

Labour and Organization
the war, employers who still take the prewar position that employees have not the right to organize for their mutual protection. The Criminal Code of Canada has, I think, conceded that right for a number of years, as have also various combines' measures that have been before parliament on many occasions in years gone by. Might I say to the hon. member for Comox-Albemi (Mr. Neill) that the Powell River Paper Company is not the only employer of labour in Canada that, maintains the position that is indicated by the reference that has been made to the Powell river situation? There are in the Dominion other employers, some of them large employers of labour, that, the Labour department has from time to time learned, have no regard for the right of labour to organize. By various methods, either openly antagonistic or otherwise they undertake to dictate to their employees what they shall or shall not do if they hope to hold their jobs. So I think that it is rather a fortunate thing, in a way, that this particular matter has come up in order that parliament might have an opportunity of learning some of the facts that are to-day existent in Canada. In July, 1918, when the Great War was possibly at its most critical stage, it was no doubt properly regarded as the right thing to concede to labour the privilege of organizing, presumably for the purpose of maintaining that degree of satisfactory harmony and cooperation between employer and employee which was necessary to carry on the affairs of Canada and assist in winning the war. It seems to me that if that was the proper condition at that time, under the stress and strain of war, it is equally necessary that the same condition should prevail now and should be recognized as applicable to afterwar conditions, when it is just as incumbent upon us to carry on the affairs of Canada with the greatest degree of satisfaction and harmony so that we may promote that agricultural, industrial and general prosperity which the Canadian people have a right to expect. I have no words sufficiently strong to express my personal view of operating officers of any particular employing company who, at this particular stage in Canada's history, yes, at this stage in the history of the world, and in view of labour organization elsewhere, take the position that they will dismiss a large number of men and turn them adrift to look for occupation in other places, unless these men turn in the charter of a presumably reputable labour organization, before Sunday next. But having said that, we have a great deal more to consider. We have come to this question: What is this House
going to do in the matter? And we find ourselves in the position of being unable as a federal government, or if you like as a federal labour department, to adopt any measure, so far as I know, that would dictate to any particular employer just what he should or should not do in a matter of this kind. In other words, this is a question that has reference to provincial rights conceded under the British North America Act, it is one of the property and civil right prerogatives of the province of British Columbia, in this particular case, and of the other provinces of the Dominion where a similar situation might develop. The provincial remedy,
I should think, ought to be available to employers of labour throughout the length and breadth of Canada, who I am sure desire a return to normal conditions in this country and that resumption of business activity which Canada is capable of. But it seems to me that these business concerns, whether at Powell river, British Columbia, or at the farthest eastern end of Canada, should realize as soon as possible that this particular method of denying red-blooded workingmen the same rights that they demand for themselves is regarded, or at least it ought to be regarded, in this country, as ancient history. Employers would complain very bitterly and make endless representations to this parliament and to the governing bodies in the provinces, if they were denied the right to organize. I think if the circumstances in regard to the situation at Powell river are as indicated by the telegram read by the hon. member for Comox-Albemi (Mr. Neill), that this House is justified in feeling at least keen regret that any employer of labour in this day and age should have taken or should maintain the position that has apparently existed in connection with these workingmen.


Mr. J. S. WOODSWORTH (Centre Winnipeg) :: There are a few points which I should like to introduce by way of supplement to what has been said by the hon. member for Comox-Albemi (Mr. Neill) and the hon. member for Skeena (Mr. Stork). Very few people who live in the East or in the central portion of the East recognize the evils that are connected with these company or closed towns. There are a few such towns I believe in the province of Ontario, but there are a number on the west coast, remote from the centres of civilization, where the employers have absolute control over the lives of their employees. Not only does the company control everything that goes on in the
4 p.m. factory, but the only house that can be rented by anyone is a com-
Labour and Organization

pany house; the only store at which anyone can deal is a company store; the only church which anyone can attend is a church maintained by the company. A clergyman who was officiating in one of these churches told me that he was practically dictated to as to what he should say in that church. The only schools to which the employees can send their children are those that are more or less dominated by company officials, and the only places of recreation to which the people can go are those provided by the company. An Englishman who was about to lecture in one of these company towns informed me that before he could obtain any place in which to lecture, the church building being the only available one, the superintendent of the company had to be consulted; and before he was allowed to stay overnight in the town he had to report to the superintendent. That is the situation that prevails in these towns; there is practically no civil liberty whatever. In some instances, even the government post office, is located in the company's store, which brings all the mail under the survey of the company's officials. If a man were suspected of receiving a letter from some labour agency he would be liable to be dismissed. I was told by an old classmate of mine, who happened to be at one time in the employ of one of these companies, that even the labour newspapers which passed through the government mails, were refused delivery to the employees. And in this case the employers were American companies. I submit that with such a condition of affairs in existence in this country we have a right to know who is going to be supreme, the government of Canada, which ought to embody the best ideals of British liberty, or some of these firms which come in from the other side of the line and attempt to administer their affairs on this side in the way in which they have done in the western states. The member for Comox-Alberni, I think, was quite right when he pointed out that perhaps there is nothing that will bring about a spirit of unrest so much as this denial to the ordinary workingman of the very first principles of liberty. The member for Comox-Alberni himself suggests that he does not very much wonder that people labouring under those conditions become restless-to use his own words, become Bolshevists. As a matter of fact, it is where these principles are denied that you find the greatest unrest to-day, and it is for the government of this country, if it would avoid these evils, to devise constructive measures which will safeguard the interests of the humblest subject in Canada. The Minister of Labour (Mr. Murdock) ought to go a great deal further
]Mr. Woodsworth.]
than he seems prepared to do at this time. He has told us of the decisions of the peace conference at Versailles and of the conference on industrial relations which took place some years ago. He has said that no words of his can be too strong to express his personal view in regard to this matter. But it is not his personal view that we want to hear; what we want to know is what the government is going to do under the circumstances. He says it is very strange that these things should take place anywhere in Capada, yet in the same breath he says it is too true that they do take place. We submit that under these conditions it is for the government to say what they shall do.
The Minister of Labour denounces those who deny to red-blooded work'ngmen the right to organize. But what is he going to do for those same red-blooded workingmen? Curiously enough, the Minister of Labour again presents us with the idea that we must not come in conflict with provincial jurisdiction. It is a very strange thing that when we ask for some provision for unemployment insurance we are told that it is a question of provincial jurisdiction. When we ask for some provision for old-age pensions, we are told that for the Dominion government to act in that manner would constitute an interference with provincial jurisdiction, and so on with measure after measure. Surely here is one case in which there can be no conflict of authority; here is one instance in which the federal government can act. If the federal government is not in a position to assure civil rights to its people, I want to know for what we exist? A few months ago, when there was some trouble down in Nova Scotia, troops were immediately rushed to the eastern coast to protect property. If it is within the jurisdiction of the federal parliament to protect property, if they can find the means so to do, surely it is within their jurisdiction to find some means to protect personal rights. It is not for members in opposition to say how this can be done. Early last session I introduced a measure to amend the civil code in such a way as to protect the workingman in his right to speak freely, That measure received its first reading, was sent to a special committee, and was reported by that committee, but we had not the opportunity to give it its second reading. Within the first two or three weeks of the present session I introduced a measure similar to that which had been favourably reported by the special committee last year, but we have not had an opportunity of getting it before the House. It is next to impossible, on account of the way the busi

Labour and Organization
ness of this House is conducted, for any private member to introduce a bill with any hope of its going through the House or even of its being discussed by the House. In these circumstances it is useless for anyone on this side to introduce legislation to meet this case. It is, however, quite within the power of the government-indeed it is their responsibility-to introduce such measures as will safeguard the rights of individuals. I am not suggesting what might be done. One member has thrown out the idea that we might very well-


James Murdock: May I ask the hon. gentleman a question? Is it not a fact that the British North America Act gives the provinces the exclusive jurisdiction over property and civil rights?


James Shaver Woodsworth: I do not know that it does, Mr Chairman.


Mr. VIEN:: You ought io know the British North America Act.


James Shaver Woodsworth: I take it that the Dominion government has certain rights, and also certain responsibilities, in the way of protecting its citizens against unjust treatment. If it has not, then I repeat that I do not see why we are here. If the government were really interested in the matter it would be possible in various ways to accomplish this purpose. I know that the threat of the tariff would accomplish it, but I would like to see some better method adopted. I say that the threat of the tariff would do it if the government chose to use it-and they would use it under certain circumstances. After all, without going into a discussion of the matter, does it not seem absurd that the beneficiaries of this protective tariff on the west coast should for the most part be made up of firms financed by American capital? In other words, we are protecting the Americans, who are largely the beneficiaries. But I care very little about that part of it. I am pleading in the interests of large numbers of workers on the west coast and elsewhere throughout this country. I am asking that the government should not pass this matter by, but that it should devise ways and means of protecting the undoubted liberties of the people. I am not going to offer any threat; I do not believe in making threats. But I should like to offer a little bit of advice, if I may, to the country and to the government. Some of us have been trying to urge that the labour people act through what are termed constitutional methods. Some of us have been
trying to urge that they adopt political means of bringing about desired results. But how can wo do so with any hope of success if the government admits that under the present circumstances it is helpless to protect the men? In that case sooner or later-I do not know about the circumstances of this particular case-undoubtedly the men will attempt to protect themselves. I think such action is recognized by British law as being the right of every man. According to the older philosophers and lawmakers that was one of men's inalienable "natural rights;'' it was looked upon as deeper even than any political or government rights. Sooner or later if political institutions fail to function, men will take that view.
Somebody has just suggested to me that I make one point clear so before I sit down I should like to reiterate it, although I have already emphasized it. If this matter of civil rights and property rights is entirely within the jurisdiction of the provincial governments, why, as I asked a little while ago, did the federal government last year send troops down to Nova Scotia?


Mr. J. J. HUGHES (King's P.E.I.):: Mr. Speaker, coming from the far eastern part of Canada, as a citizen of this country and a member of this House, I want to say a word or two.
The Minister of Labour (Mr. Murdock) intimated in the course of his remarks that the federal government and the parliament of Canada had no power in a matter of this kind, and later he stated what is undoubtedly true, that the question of property and civil rights pertained exclusively to the provinces. Then it strikes me as a layman, not as a lawyer, why was that order in council passed in July, 1918 if 'it had no power to interfere in such matters?


James Murdock: Under the War Measures Act.


James Joseph Hughes: I was just going to ask whether the government at that time was exercising the power it had received from parliament under the War Measures Act. If that was the case, I will reason this way: If parliament had the power to give the government of that day authority to act in that way, has parliament not that power at the present time? Perhaps the reply may be that we were then under war conditions. Well, Sir, if matters of this kind can go on I would almost say that we are at war now. We are under a measure of war, because this is a very serious matter. It involves not only the rights
Labour and Organization

of property-and I take second place to no man in protecting the rights of property-but the rights of man are also in jeopardy. So far as my voice and my vote will go, I will support this government, the provincial government, or any power in Canada, that will exercise every power it possesses to protect the rights of property whenever and wherever they are threatened, but I will say the same and go a little bit further perhaps in protecting the rights of man. I think this is a matter that should receive the serious consideration of parliament. We should let the labouring man and every man in this country know that he will be protected in his civil rights so far as we have the power, and if parliament has not the power it should obtain the power by some means or other. If an occasion should arise when the provincial government would refuse to interfere, what would be done then? I repeat, this matter should receive very serious consideration, and these men who are doing no wrong but against whom a great wrong appears to be contemplated, should know that they have the sympathy of this House and the sympathy of the people of Canada behind them.


Thomas Vien: My
hon. friend from King's (Mr. Hughes) has said that he has spoken as a layman. There are questions with which this parliament cannot deal unless we amend the British North America Act. When a workingman leases his labour to his employer he passes his civil contract to his employer, and that contract is subject to all the conditions that the parties thereto have agreed upon. When an employer who leases the sendees of the employee puts in the contract a condition that the employee shall not belong to a union or inserts some other condition, I fail to see how this parliament would have jurisdiction to interfere in the matter of the civil rights and the civil contracts of the two parties. It is all very well to talk about sympathy for the labouring man and of protecting property, but it is talking outside of our jurisdiction, outside of our province, if the British North America Act reserves that to the provincial authorities. I beg to submit, Mr. Speaker, that the question is absolutely without our province and that the provincial authorities concerned should take the necessary steps to redress the grievance.


Mr. IRVINE:: Does the British North
America Act override the British constitution?


Thomas Vien: Yes. The British constitution has nothing to do with Canadian affairs. We have clamoured time and again that we are

a nation governed by the British North America Act, and the principles that are not sanctioned by the British North America Act and that may be in force under the British constitution have nothing to do with us.


James Shaver Woodsworth: Has the common
law of Great Britain nothing whatever to do with us in Canada?


Thomas Vien: Nothing at all. The common law of Great Britain has nothing to do with us in Canada except in those provinces that have said that their civil rights shall be governed by the common law of England. In this country the common law is left to the provinces, and if the provincial authorities, acting within the powers that are given to them by the British North America Act, declare that their civil rights shall be governed by the common law of England, then the common law of England applies, not on account of its power and authority, but on account of the fact that the provincial authority has accepted the common law of England as governing its civil rights.


Mr. MARTELL:: Is it not a fact that in all the English-speaking provinces of Canada the English common law is in force save in so far as it has been altered by statute and where it has been found inapplicable to our situation as a colony? I think my hon. friend will find that is a correct statement of the case. I think that is the principle established by the case of Uniacke vs. Dickson.


Thomas Vien: My hon. friend will find that the principle I have enunciated is exactly in conformity with his own opinion. The common law of England applies in provinces that have sanctioned it in their provincial law Civil rights are left to the provinces and if in the exercise of their jurisdiction the provincial authorities find that they should apply the common law of England as their civil law, they are absolutely free to do so. I grant that outside of the province of Quebec all the other provinces have done so, but this does not change the principle that I was discussing ; that is to say, whether it is the common law 0f England or a provincial statute that governs civil rights in any province, any question arising out of civil rights is left to the jurisdiction of the provinces, and we arc simply wasting our time discussing a matter which should have been raised in the legislative assembly of the province interested or taken up with the provincial government interested. For that reason I quite agree with the hon. Minister of Labour (Mr. Murdock./,

Labour and Organization
and I am ready to support the stand he has taken,


Mr. T. G. McBRIDE (Cariboo):: In rising to say a word on this question I might state that I have known the Powell River Company for many years, and I did not think they would lower themselves to take the stand they are taking at the present time. Surely, when the people of Canada can organize and pool their wealth in companies and corporations, the workingmen of Canada should have the right to pool their labour and organizations to deal collectively. I think that thin government, if it is possible to do it, should take some steps to bring this company or any other company to time that tries to take advantage of the workingman of this countiy.


Mr. W. C. GOOD (Brant):: I listened patiently during the eloquent address of thp Minister of Labour (Mr. Murdock) for some suggestions as to what might be done, but I was exceedingly disappointed when he sat down without having suggested anything but his inability to make any recommendation whatsoever. I think we ought to have some suggestion from the government, or from the Department of Labour, as to what positive powers the province would have, and as to how this matter can be dealt with either by the present government or by the provincial authorities. To simply sit helpless and hopeless in the face of such a situation as this seems to me to be, to say the least, most regrettable.
I have just two other very short observations to make on the situation. One is in answer to the hon. member for Lothbiniere (Mr. Vien), that we were a nation governed by the British North America Act. Well, we are scarcely a nation if we have no control over our own constitution. If such is the case, I hope the time will soon come when we shall have control in this matter. The other remark I should like to make is that the situation which has been presented to us is the natural and inevitable result of the capitalistic system in industry. We cannot help it developing, and so far as I can see we have got to face even instability, inefficiency, sabotage and bloodshed until this system is replaced by something of the co-operative nature. I hope the government will, in spite of the confessed inability of the Minister of Labour, take this matter in hand and in consultation with the province of British Columbia, do something to avoid and avert what may be a very serious thing.


Right Hon. W. L. MACKENZIE KING (Prime Minister):: 1 wish to draw the attention of the House to the circumstance that all we have before us in the present discussion is a communication which my hon. friend from Comox-Albemi (Mr. Neill) has read. We do not know the particular organization to which reference is made; indeed, we do not know any of the facts other than as represented in this message. It is somewhat difficult for the government to make a pronouncement that will cover what may be a hypothetical situation. I do not hesitate for one moment to say that if the facts are as represented in this message, and I have no reason to believe that they are other than as represented, it should be intimated to the company, and it will be intimated to them, that this parliament in the name of Canada has given its adherence to the articles of the Treaty of Versailles and the labour convention attached to it, and that one of the terms of the latter is the right of association for all lawful purposes-by the employee as well as the employer-to preserve this right is something to which we are committed and bound by that treaty. I think it will be sufficient if the attention of the company is drawn to that particular article, and to the debate which has taken place here, to focus public opinion and public sentiment upon any course of behaviour on the part of this company which may be counter to that particular article of the treaty. If that is not sufficient I shall be very much surprised if the parliament of Canada cannot find some means of satisfactorily dealing further with the situation.


Mr. L. W. HUMPHREY (West Kootenay):: Notwithstanding the remarks made by the hon. member for Lotbiniere (Mr Vien) I feel that he does not wish to have a wrong impression created in this House. He seemed to be of the opinion that an agreement had been entered into in this case between the employees and the employer stating that the former would not become members of a trade union. I feel that such is the case because my knowledge and my experience lead me to believe that the employers of labour throughout the Dominion welcome the idea of labour organizing into trade unions. During the last twenty years I have not met any employer of labour who did not welcome the principles held in mind by labour men in organizing and becoming members of these unions. The principle involved in the case to which the hon. member for Comox-Albemi has drawn attention was decided many years ago. To-day the majority of the largest employers of labour throughout the Dominion not only recognize that principle but they welcome discussions by represen-



Labour and Organization
tatives of labour bodies on industrial matters of mutual interest and even, at times, invite discussion on the management of their particular industry. In the majority of cases this policy ensures better service, a greater degree of efficiency, and on the part of the employee a feeling of contentment. The principle involved here is so important that I was disappointed the Minister of Labour could not make a more definite statement as to what action he was prepared to take. Because failure to take the right course might precipitate a very serious situation. It might involve a strike on the part of the employees of the Powell River Company, to say the least of it. So that any action on the part of the Department of Labour or of the Government in opposition to the drastic and extreme course apparently pursued by this corporation would be welcomed by the trades unions as well as by the general public throughout Canada. In my opinion the government would be well advised in taking such steps as will re-assure the employees of this industrial concern as to their rights in this matter.
Upon Mr. Neill rising to reply.


Hewitt Bostock: Under sub-section 2 of Rule 21 the right of reply is allowed to an hon. member who has moved a substantive motion. In this case the motion was to adjourn the House, and therefore there is no such right. The hon. member for Comox-Albemi (Mr. Neill) may, however, be granted the privilege with the unanimous consent of the House.


Alan Webster Neill: I only wish to speak for a few moments.


Hewitt Bostock: Is it the pleasure of the House that the hon. member have leave to reply?


Some Hon. MEMBERS:: Carried.


Alan Webster Neill: I thank the House for permission to reply. I hope the hon. member for Lotbiniere (Mr. Vien), was not sincere or not correct, when he made the statement that when a labouring man leased his labour to his employer it was possible and proper for the employer to include in that contract a provision that he should not join any particular body. In that case, the contract necessarily carries with it the converse; that the employer has the [DOT] right to compel the employee to join a particular body. If the principle applies to a trade union, it would apply to every other organization. It might for instance, be a religious body. It might be

a condition of the employment that the employee should forswear the religion he had followed and adhere to that of his employer. The proposition lends itself to no end of possibilities, or impossibilities. It might also go to the extent that his employer would include in the lease or contract of labour the disposition of his vote. That might happen quite easily and it is a legitimate deduction. We would then be going back to the pocket burroughs of the feudal ages, where we had a man buying a certain seat with two or three representatives in it who had to vote the way their purchaser or employer dictated. I thought the feudal system had been done away with some hundreds of years ago, but I am sorry to see it is still lingering in certain corners. I am not a lawyer, and I cannot follow the intricacies of the debate as regards common law as against any other law, but I do know that there is a law of common sense and it is against common sense to say that when a working man sells his labour to his employer he also sells his soul to the employer. If the argument were carried out to a logical conclusion, that would be the situation.
The remarks which have been made here today, and especially the remarks of the Minister of Labour (Mr. Murdock) show that there is a real necessity for legislation dealing with this matter. If the minister cannot deal with it-and he has shown fairly plainly that he cannot deal with it formally-I might say, at this moment then it shows there is need for legislation. With reference to the question as to where the jurisdiction lies I think the power that passed the order in council, even though it was not entirely obligatory, yet was almost mandatory at any rate-has also power to deal along those lines, even in times of peace. At any rate we are aware that this parliament has passed legislation such as the Industrial Disputes and Investigation Act and provided for boards of conciliation, and so on, dealing with relations between capital and labour, and certainly those relations can well be deemed a national issue rather than a provincial one. For the rest of my remarks I might merely echo the statement of the Prime Minister. While there may be no legal way to deal with the situation, we know what Shakespeare says-"Conscience doth make cowards of us all," and there is no greater pressure on some people than the pressure of sentiment and public opinion. If the Minister of Labour were to advise this particular company of the provisions of the order in council which I have quoted, and tell them

Canada Naval Reserve
that, while it is not obligatory, as there is no penal clause attached to it, if it were not adhered to by labour on the one hand and employers on the other ,it might be necessary in the opinion of the Minister of Labour to crystallize that order in council into legislation, it would have a very salutary effect. He might also summarize the debate in the House, and say that the House has expressed strong disapproval of any company so heavily protected as they are, refusing the right of their employees to join a trades union. I think that would be more effective than putting the legal machinery at work. If he would act along the lines suggested, I am satisfied the situation would be adequately met.
Motion withdrawn.



CANADIAN NAVAL RESERVE

[Stage Direction]
On the Orders of the Day:
Mr. WILLIAM DUFF (Lunenburg):: Before the orders of the day are called I would like to ask the Acting Minister of Defence (Mr. Macdonald) a question, based on a despatch which appeared in the morning Chronicle of Halifax a few days ago which reads as follows:
Ottawa, May 14-(By Canadian Press)-An official announcement to-night states that five companies of the Royal Canadian Naval Volunteer Reserve have been formed and others are almost up to strength.
The companies already formed are Quebec, Ottawa, Hamilton, Saskatoon and Calgary. Edmonton and Winnipeg will be ready to form their companies within a few days.
"The progress which has been made in recruiting for the Royal Canadian Naval Volunteer Reserve has been satisfactory. This reserve is composed entirely of young Canadians between eighteen and twenty-two years of age. They are already showing fine interest in the work and promise to build up a highly efficient reserve force," adds the announcement.
I desire to know from the minister if this is true; and if the despatch is true, why is it necessary to recruit members for a Royal Voluntary Naval Reserve in the inland cities of Saskatoon, Calgary, Edmonton, Winnipeg and Ottawa? I desire to know why, instead of recruiting Royal Voluntary Naval Reserve in these places, they do not go to such ports as Pictou, Sydney, Canso, Lunenburg and Yarmouth on the Atlantic coast, and Vancouver, Victoria, Prince Rupert and Alberni on the Pacific coast? Why go to the expense of recruiting these men in the inland cities, and taking them to the seaboard at a very great expense? I wish to know also if, when the naval reserve volunteers are recruited, every volunteer will be supplied with a package of Mothersill's seasick remedy?
184J


Hon. E. M. MACDONALD (Acting Minister of National Defence):: I rise to make
clear exactly the position of matters in regard to the naval reserves. There are two reserves, the Royal Naval Reserve, and the Royal Naval Volunteer Reserve. The Royal Naval Reserve is made up entirely of men who are accustomed to the seafaring profession, and whose duties upon ships would be those which would be usually performed by men who have been engaged in seafaring life. During the last year preparations have been proceeding, and it is expected, in regard to this branch of the service, that after the first of July, in the maritime ports both on the Pacific and the Atlantic, volunteers will be asked, and careful provision is being made for the inauguration of this part of the service. There is a Royal Naval Volunteer Reserve, which is made up of another branch of the service. On naval vessels there are to be found men who have been engaged in almost every kind of occupation, from sailors to mechanics. Organizations for training recruits are being formed in the inland cities very largely through the influence of the Naval League.


William Duff: Are there no sailors on the
Atlantic coast?


Edward Mortimer Macdonald: We will
look into that when the preparations are all made, which we expect will be after the 1st of July. In the various parts of Canada, in the interest of those who are devoting themselves to naval matters, organizations of this kind are being formed, but there are men who happen to be born inland who would be able to serve at sea, in the occupations they had been engaged in, and I think it is of interest to state that during the late war a very great proportion of the recruits obtained for the United States' naval force were drafted from the inland cities. These naval companies are made up from men of this class, who had been engaged in occupations which would fit them to go on board vessels in some capacity, and these men are trained and drilled at their own homes. Arrangements are being perfected as the force is being developed, to provide for a certain short period of training at the seaports, either on the Atlantic or on the Pacific. The difference between the two classes of people who are being recruited for the services is simply the difference between these two services.


William Duff: How are they going to train
them? Will they use prairie schooners?


Edward Mortimer Macdonald: My hon.
friend is very keen and the acumen which he

The Budget-Mr. Grimmer
has been accustomed to display in the House in a good natured way, causes him to take a great interest in this matter. I have been in the department four weeks and have been devoting myself with a good deal of interest to this line of service, and I can assure my hon. friend that I will welcome his co-operation in this matter, so that we may have a service on the Atlantic coast.


Hewitt Bostock: I might remind hon. gentlemen that such questions must not degenerate into a debate; otherwise we shall find ourselves at sea.


Arthur Meighen: Before the question
drops, would the minister tell us which of these forces it is-or is it both?-the training of which consists in learning to fish? We were told by the hon. member in the debate on the estimates, that that was the training that was to be given to one of them.


Edward Mortimer Macdonald: That is a phase of the subject I have not yet considered.


William Duff: Evidently they have not given it much consideration.
BUDGET STATEMENTS On the Orders of the Day:


Arthur Meighen: Yesterday I asked for the elements, the items constituting the revenue of the country for the preceding year. Those I have received. I wish to ask further for particulars of the appropriation credited against the National Railways this year and last year-some $92,000,000 and $97,000,000- in the speech of the Minister of Finance (Mr. Fielding). I think we should have the items that make that up, and the purpose to which each has been devoted. Some of it, of course, was in the recoupment of deficits, but a very large amount must have been in the way of advances. I think the House should have been informed of this in the budget speech itself.
I also call attention to the fact that the budget statement gives no account of our present debt. Not only should we have a statement of the present debt, but a historical account; but if the items are given, that is all I will ask for at the moment.


William Lyon Mackenzie King: I think I have in mind what my right hon. friend wants; but if he would give me a written memorandum of it, I will give him the information as far as possible.
(Mr. Macdonald.]



THE BUDGET


[Stage Direction]
The House resumed from Thursday, May 17, the debate on the motion of Hon. W. S. Fielding (Minister of Finance), that Mr. Speaker do now leave the chair for the House to go into Committee on Ways and Means, and the proposed amendment thereto of Mr. Robert Forke.
Mr. R. W. GRIMMER (Charlotte):: Mr. Speaker, in the budget presented by the Minister of Finance (Mr. Fielding) I note that the proposed change in the British preferential tariff will apply a further discount of 10 per cent in customs duties on goods coming directly to Canada by way of Canadian ports. The object no doubt is to encourage the use of Canadian ports and incidentally the use of the Canadian National Railways. I believe in the principle of giving every encouragement to imports coming directly to our ports. At the same time we should not lose sight of the fact that Canada is an exporting country, and that we should encourage, perhaps I might say, educate our people to the fact that to build up our country, our railways and our ports, it is absolutely necessary that our exports should be sent by Canadian roads through Canadian ports to the markets of the world.
I am sure we must all admit that one of the greatest problems that Canada is facing to-day is that of our railways and transportation. We are all familiar with the situation as it now stands. Our railways are not hauling the traffic that legitimately belongs to them, and the United States is receiving that traffic, which is assisting to build up the port of Portland and other foreign ports, this being detrimental to our own in Canada. The greatest difficulty in sohring the problem is the argument that as yet we have no port that is absolutely adapted as an all-the-year-round outlet to our railway system in our own country, in spite of the fact that large sums of money have been spent in the development of our ports throughout Canada. I believe it to be in the interests of the people of Canada to make these expenditures, and I would urge upon the government the necessity of the earliest possible development of all our ports. Even then, however, it is not possible to obtain results that will entirely remedy the present system of transportation. When the people of Canada fully realize that Canadian products shall be carried by Canadian rails through Can-

The Budget-Mr. Grimmer
adian	ports to the	markets of the
world, then and then only will Canada become the nation that she is destined to be, and our ports will naturally come into their own. We may very well take a lesson from the great republic to the south of us, whose people have built up a wonderful commercial country by the development of the ports along their coast line, taking care of their own 'business, reaching out as handlers of the export trade of Canada, thereby receiving every year millions of our good Canadian dollars that we should be spending in the development of the industrial life of this country, patronizing their own railroads, spending their own money in the industrial life of their country, giving employment to their people and making them happy and contented. Here in Canada with a larger extent of area, with the unbounded, undeveloped natural resources of a great country, linked together as we are from ocean to ocean by railways owned by our people, with branch lines running into every important centre, we should patronize our own railways by carrying our exports to our own ports, spending our own money in Canada in developing the industrial life of the country, giving employment to our own people and keeping our young men at home, because this is the best immigration policy that any government could adopt.
Realizing as we do that 70 to 80 per cent of the export trade of this country is going through American ports, why should we permit a condition like this to continue to exist, when we have an all-the-year-round outlet to our railway system in Canada situated at our door in Charlotte county in the greatest natural harbour on the Atlantic coast of North America? This harbour is pronounced by experts to be one of the great world ports created by the hand of nature with a 60-foot depth of water for four miles of harbour, 60 feet to 150 feet deep all the way from the Atlantic ocean into the port where the largest vessel that has ever been or ever will be built can come in under her own steam and dock without the assistance of tugs. There are no shoals or ledges to contend with. There is a splendid opportunity for anchorage for ships in Passama-quoddy bay in event of storm. There is ample accommodation for the fleets of Europe, and the harbour is free frdtn fog and ice and open all the year. No dredging is required; nature has done it all. We would advocate connecting by rail with the Transcontinental at Quebec, making St. Croix the nearest possible point on the Atlantic coast to Winnipeg.
A report was made by a special committee of the Senate of Canada, consisting of fourteen members, assembled at Ottawa, April 20, 1921, "to inquire into" conditions responsible for the routing of a large portion of "Canadian export trade via American instead of Canadian ports," this committee having power to call for persons and papers in connection with the subject to be investigated. The committee, after many sittings, made its final report June 9. 1922, and so satisfied must it have been with the evidence submitted that it concludes its exhaustive findings, in part, in the following words:
After careful consideration of all the evidence submitted, your committee is of opinion that there exists a most serious condition of affairs with regard to the diversion of the western grain trade to New York and other United States seaports for export.
There seems to be no doubt that two-thirds and problably four-fifths of that trade takes that route and that we are paying many millions annually to United States railways, lake carriers and elevators that would be earned by our own railways and trainmen if it were possible to export this grain at Canadian seaports. [DOT]
Since this evidence was taken government statistics show that the diversion still continues and that of the bountiful crop of 1921 no less than 99 million bushels of wheat went from Fort William to Buffalo.
Evidence was produced before this committee to show beyond any question that wheat could be hauled profitably from Winnipeg to Quebec over the National Transcontinental Railway for 18 cents per bushel. This fact being established it could be continued 260 miles further to St. Croix harbour for 22 cents, per bushel. The rate to New York is 32 cents per bushel. Thus a saving of 10 cents per bushel on even 200 million bushels would mean 20 million dollars saved to the farmers of the prairie provinces yearly.
What does this mean? It means that $20,000,000 distributed annually to the farmers of the prairie provinces would so improve conditions that it would not be necessary for them to ask the banks to advance loans to enable them to carry on their industry, and would place them in the very near future in that position in which they would be able to ask the banks whether they could not pay more than 3js per cent on the deposits of farmers. In the year 1837, Admiral Sir W. F. W. Owen in a report to the Imperial government on this harbour had this to say in part:
There is no point within my knowledge better adapted by nature than St. Andrews for being made a mercantile port with extensive advantages and facilties, the out ports,-so to call them,- or ports adjacent to this port, are in themselves very commodious ports and furnish shelter of easy access to any number of ships of any magnitude, even for

The Budget-Mr. Grimmer
all the navies of Europe and, in short, what Liverpool has been made as a mercantile port, at an increditable expense, this port of our colonies has every advantage to adapt it for and which might be made fully available at trifling cost.
Commander Campbell, of the Beaver line fleet, says:
There can be no doubt that St. Andrews, both from its geographical position and from the natural advantages of a fine, commodious, landlocked harbor, is certainly equal, if not superior, to any other port in the Dominion as the natural winter port. It is nearer England by over sixty miles than Portland, Maine, and as a harbor is infinitely its superior, being shut in from heavy seas from all quarters. It is also free from any serious difficulties in the way of ice and carries a depth of water in the outer harbor sufficient for the largest steamers afloat. It would, if properly conducted, be a cheaper port for discharging and loading vessels when accommodations are made and ought to compare favourably with any port in Canada. I have often wondered that, possessing so many natural and geographical advantages as it does, it has not long ago become the most important winter port of the Dominion.
Captain Henry Mowat, for many years port superintendent fort the Canadian Pacific Steamship line at Liverpool, England, in a report on this harbour in 1913, says:
The approach to the port of St. Croix via Head harbour is equal to the approach of any other port in the world, and in many instances excels the best for depth of water. There are no great ports which have such great depths of water from the sea clear into port as that of the St. Croix; it is such that the largest ships now in existence and with the greatest draft of water can enter the port at the lowest possible tides.
The channels from Head harbour into Passamaquoddy bay are that the largest vessel that ever will be built can be navigated with ease at top speed with perfect safety. They are free from shoals and rock and have ample width for turning a ship in the narrowest part. The tidal currents are nothing in comparison to the river Mersey, England, and other ports I have navigated, etc.
After careful investigation, I consider St. Croix river and Passamaquoddy bay, equal to any in the world for a great national port.
In the year 1913, the Hon. Robert Rogers, Minister of Public Works in the federal government of that time, and himself a western man, seeing the possibilities of the development of St. Croix harbour, engaged Mr. E. C. Swan, a harbour expert, and a gentleman of recognized ability in his profession, together with the engineers of the Department of Public Works, and also three master mariners, to visit the harbour, make investigations, take soundings, boring, and so forth, submit specifications for the equipment necessary for the development of the port, and to draw up a report for consideration by the Public Works department. All that information secured at that time is at present in the possession of the department and no doubt would be available to any hon. gentlemen who might care to learn the facts in connection with this matter. This investigation was made shortly

after the outbreak of the war when, as we are all aware, all public works were cancelled and every energy was put forth in the prosecution of the war. Mr. Swan in his report goes into the matter very thoroughly. He deals with conditions at the port, and so forth, but I shall read only his concluding remarks.
In considering the St. Croix river for shipping purposes and as a possible auxiliary to St. John, more* particularly for the extensive traffic during the winter months, it seems to have many attractions such as- it is some 50 miles nearer the mouth of the bay of Fundy than is St. John. The distance from Montreal to St. John by Canadian Pacific railway is 483 miles. The distance from Montreal to Oak bay St. Stephen, by the Canadian Pacific railway, is 438 miles or thereby, and if in the future a branch line is constructed from Mattawamkeag to Oak bay, this would shorten the total distance from Montreal to Oak bay to 410 miles. The river St. Croix and Passamaquoddy bay is comparatively well sheltered water, never closed by ice and protected from the swell of the bay of Fundy by numerous islands near the mouth, and as there is deep water right close in shore to the sides of the river and bay, practically no dredging whatever would be necessary' to form a shipping channel. Leading lights for the guidance of shipping at night would of course have to be provided; probably some joint agreement regarding cost of same could be made with the United States. ... I therefore recommend with great confidence that wharf areas, railway terminals, roads and freight handling facilities in general, should be designed on a comprehensive, practicable scale, and constructed by degrees at Oak bay as may be necessary'.
Mr. E. C. Goodspeed, an engineer of the federal department, with whom probably hon. gentlemen in the House are acquainted, in his report as to the cost of soundings, borings, the construction of quay walls, docks, and so forth, gives an exhaustive survey of the whole matter. I quote the following:
Throughout this whole distance of eight miles, port development along the shore is possible, using quay walls along the narrower sections and where the deep water approaches close to shore; while piers or jetties would be provided at Joe's Point and Oak Point and near the mouth of the Waweig raver. . . . Any sized yard room required could be developed at t'he head of Pagan's Cover for storage purposes, while further yards would be available at the docks. These docks would be 438 miles from Montreal by rail, via the Canadian Pacific railway, compared with 483 miles to St. John. Oak Point . would also be about 50 miles nearer to the mouth of the bay of Fundy than St. John is.
This means fifty miles shorter water route to Liverpool. Mr. Goodspeed is further reported as follows:
Mr. Goodspeed also gives estimates for development of Joe's Poin^ and at the mouth of the Waweig river, both of them being a part of the possible extension of the harbour for eight miles along the eastern bank of the river.
The three master mariners who accompanied these gentlemen on their survey and investigation submitted a report in respect to the

The Budget-Mr. Grimmer
approaches and entrance to the harbour. They had this to say:
Bold and steep, suitable for safe navigation of vessels of any size provided proper aids to navigation were established for navigation at night or in foggy weather. Channel between Indian island, Campobello and East-port (turning point St. Croix river) of ample width to handle with safety any size of vessel. Good anchorage on event of fog.
St. Croix river and Oak Point: Safe And well sheltered entrance and approach, suitable for safe navigation of any size of steamer.
M. N. Fillies, master mariner, Supt. Donaldson Line, Ltd.
D. L. Kenney, master mariner, Supt. Head Line steamers.
G. O. R. Elliot, master mariner, Asst Marine Supt. C.P.R. and C.S.S. Lines.
This, Mr. Speaker, should be sufficient evidence to establish the suitability of St. Croix harbour, when proper'y developed, as a great shipping port for our grain products. The part of St. Croix river which constitutes this harbour extends from the town of St. Andrews up to w'hat is known as the ledge. I may say in this connection that when lumbering was the chief industry on the St. Croix, as many as twenty-five of the largest vessels then in the ocean trade were frequently seen at one time in the harbour known as the ledge, situated between St. Croix harbour and the town of St. Stephen. These vessels were engaged in the transport of timber across the Atlantic, and it was owing to the heavier class of timber in this immediate vicinity having become exhausted that the traffic gradually disappeared. This harbour is within four miles of the town of St. Stephen.
It may be interesting to know that the town of St. Stephen is an important industrial centre, some of the largest industries of their kind in the Dominion of Canada being located there. I may mention two of the articles that are manufactured there, Ganong's chocolates and Surprise soap, both known in every household from the Atlantic to the Pacific. Among other industries that we have may be mentioned the following: The Dominion Fertilizer Company which has an output of 25,000 tons of fertilizer annually; the Mann Axe and Tool Company, with an output of 4,000 tons annually; Ganong Brothers, sweet manufacturers, output 5,000 tons annually; Haley & Sons, handling about 5,000.000 feet of lumber anually; Canadian Cotton factory, 1,000 tons anually. We have a pulp mill with an output of over 100 tons daily, and there is the Eastern Pulp Company, handling from 50 to 75 cords of pulpwood. Coal to the extent of 50,000 to 75.000 tons a year is imported. The St. Croix Soap Company does a very large business, and there is
also a shoe factory in St. Stephen whose operations are very extensive. We have also sardine factories, granite quarries and many other industries in the adjacent parishes. Recently an American company have purchased land and water powers in anticipation of erecting another large pulp and paper mill in the near future. Another of our chief industries is the fishing industry, the market value of its products last year being over SI ,420,000. We do not claim to be an agricultural county-that is, to the extent of making any considerable exports-but we have in the past exported 40,000 tons of potatoes annually. So that the moment accommodations are provided, a considerable amount of traffic would be available the whole year round for St. Croix harbour.
Where can we look for an outlet for our railway system, through whicn our grain products, running into hundreds of millions of bushels and increasing each year, may be continually shipped all the year round to the markets of the world? There is but one answer to that question, the port of Quebec in summer and St. Croix harbour in winter. The building of the National Transcontinental railway has made the port of Quebec the logical outlet in the St. Lawrence for the grain products of	the	northwest during	theopen season	of	navigation.	The	cityof Winnipeg	is	situated at	the	veryeastern threshold of the vast grain trade, and at that point must be assembled some time during the year	the	great
bulk of all the grain raised in the districts to the west. Three great railway systems converge there from the west, and they again converge at Quebec bridge. The shortest route between these points is the National Transcontinental; on that road a distance of 1,350 miles brings Winnipeg nearer to an ocean port on the Atlantic seaboard than is possible by any other route. Mr. D. F. Maxwell, former railway engineer in the provincial government, a man of outstanding ability in his profession who has devoted many years of study to this great question, does much to solve the problem in an article he has written, and from which I will now quote:
From an engineering standpoint, the arbitrary points, both physical and commercial, which would influence the location of a railway between this harbor and the great bridge over the St. Lawrence at Quebec, come so near the air line that it is safe to conclude that a railway can be located that would not exceed the air line distance by more than fifteen per cent, thus making the total distance 260 miles on the whole and thu3 making the total distance from Winnipeg to St. Croix harbor 1,610 miles, or more than 100 miles shorter than from Winnipeg to Portland, Maine, via Canadian Pacific and Grand Trunk railways, (shortest
The Budget-Mr. Grimmer

route) and more than 200 miles shorter than from Winnipeg to St. John, via the Canadian National Railway, (shortest route), and about 370 miles shorter than from Winnipeg to Halifax via Canadian National railway, (shortest route).
When this route is completed and properly put into commission, and when the necessary grain exchange, elevators and so on are established at Quebec, the great question of the transport of our grain will have been settled so far as the St. Lawrence route goes and our problems in that connection will at least have been partly solved.
The next question is, will St. Croix harbour serve as a winter port? The St. Croix harbour is in the St. Croix river, which forms the boundary line between New Brunswick and the state of Maine. The air line distance from Quebec bridge to St. Croix is 226 miles. St. Croix harbour is without doubt the greatest natural harbour on the Atlantic coast of North America. A distinctive feature is its geographical position, which will naturally have a favourable effect upon insurance rates as compared with the rates to United States ports. Then, St. Croix harbour is nearer the great coast cities of the United States, the West India Islands, Cuba, Mexico and South America than is any other port in Canada. It is nearer Europe than any port in either the United States or Canada that could be considered, except Halifax. A very important feature in connection with the harbour is the small cost of development. But the most unique feature is that the St. Croix river, being the boundary line, it may be both Canadian and American, a condition that could not be possible anywhere else.
Halifax, as you are well aware, has never shipped any quantity of grain on account of the long rail haul which made it impossible for it to compete profitably with American ports. St. John will always continue to ship annually, and Montreal will always continue to be as it is now the summer port, as it is the summer terminal of the lake water route as well as of the Canadian Pacific and Grand Trunk railways. What we want, Mr. Speaker, is to haul over our own railways and to ship through our own ports practically seventy-five or eighty per cent of the grain that now finds its way out through Portland, Boston and Baltimore. If we were taking care of this traffic ourselves our railway deficits would soon begin to disappear. If this harbour were developed to even one-half its present capacity and railway connection were made with the Quebec bridge the transportation problem would be fully and completely solved. Again, it will be physically impossible to transport 
in winter gnfin from Winnipeg to any other Atlantic port as cheaply and as expeditiously as it can be carried by this proposed route to St. Croix harbour for the reason that gradient and the ton-mile haulage must continue to be the governing factors in the cost of railway transportation.
The building of the National Transcontinental railway, and particularly the part between Winnipeg and Quebec, and the bridging of the great river at this point, changed the westward objective of all Maritime province railways and brought the prairie provinces nearer by some three hundred miles to the Maritime province ports than was the case before, as well as giving the port of Quebec its commanding position as the logical outlet in the St. Lawrence. This is a great national project. It was intended by nature as the greatest highway possible between the world's greatest granary and the nearest and cheapest possible points of shipment during the whole year for its products for the world's markets.
Then, of course, would come up the question, how can this proposed railway across Maine be built? That is a pertinent question to the inquiry. The answer should not be difficult If the parliament of Canada was justifier thirty-five years ago when its revenues wer< under 40 million dollars a year, in granting financial aid to the Canadian Pacific railway, across Maine to the extent of five million dollars for a maritime winter outlet for that railway, why should it not be justified in granting financial aid now to a similar undertaking when its revenues are more than ten times what they were then and grant aid commensurate with the cost of building a railway to-day and in consideration of the character of a road necessary to be built to-day, with a standard grade of 21-4 feet per mile, against a grade of 52.8 feet per mile at that time, and particularly in view of the fact that the government owns two transcontinental railways now resting their noses on Quebec bridge and looking for a maritime port of which the nearest and best possible one to be had is this splendid undeveloped St. Croix harbour, which can be reached by building about 200 to 210 miles of railway at the most.
This is made possible by utilizing that portion of the National Railways east of Quebec as far as St. Malachie and for which distance it is pointing directly for this harbour and where it then turns north around the state of Maine on its way to Moncton, New Brunswick.
How can this project be successfully carried out? The Canadian National Railway Board cannot build a railway across Maine.

The Budget-Mr. Grimmer
The answer to that is that if the Dominion government will grant a suitable subsidy each year for twenty years for the purpose of constructing a railway from Quebec bridge to St. Croix harbour by the shortest and most practicable route, a private corporation could, no doubt, be formed that would guarantee its construction and hand it over to the Canadian National Board, who no doubt could operate it.
When this is done, all that remains necessary to be done is to equip Quebec and St. Croix harbour with the necessary docks and elevators and which may be accomplished, covering the period of, say, ten years by spending a certain amount every year on each, by the end of which time we would be shipping all of our own grain over our own railways, through our own ports.
This is no visionary scheme, but a plain, business proposition, and one quite within our financial ability to carry out, and the carrying out of which will settle for a long period of years our most vexed problem.
This is not only a practical solution; it is the only solution.
Reliable data at hand show another physical feature that distinguishes this route. That there is only one summit between the St. Lawrence and this harbour to overcome and that only 1,200 feet above the sea level, compared to 1,854 feet on the Canadian Pacific between Montreal and St. John, and 1,800 feet on the Canadian National. Reliable surveys already made show that it may be overcome with a four-tenths per cent grade.
I wish to point out that the people of the Maritime provinces are solidly behind any project that would remedy the present condition of affairs under which our traffic is being diverted to the United States. This traffic which now goes to Portland and other United States ports should go through Canadian ports. We should keep our own railways busy carrying our own products. That would be in the interests of the whole of this country.
St. John, as you know, is the only winter port on the Atlantic at the present time for the shipment of grain. It is an important and valuable port but unfortunately the port is limited in the degree to which it can be extended. Both Halifax and St. John are doing a great public service. Both have magnificent harbours and should be developed to their utmost capacity, but even if they were developed to their utmost capacity it would not be possible for them to handle all the traffic that might be diverted from United States ports. Therefore, I think it is necessary to develop St. Croix harbour.
We in Charlotte county do not look upon this development as a great boom for the county or the province of New Brunswick. We feel that it is a work of a national character for the benefit of the whole Canadian people, because at the present time we could not take care of the traffic if it were diverted from the ports of the United States.
I should like to quote from an editorial published in the St. John Journal of January 23, 1923, which I hope will convince hon. gentlemen that the people of St. John are in sympathy with the development of any of our ports along the Atlantic coast:
There is no doubt that St. Croix is a great natural harbor and experts have testified that it and Sydney, Australia, are the two greatest harbors in the world. The development of St, Croix should not necessarily injure St. John. Canada is exporting this year in the vicinity of 350,000,000 bushels of grain and of that amount St. John gets about 20,000,000 bushels.
A mere bagatelle! Where does the rest go? Montreal gets a large proportion of it in the summer months but about 200,000,000 bushels of this grain go through American ports and are transported over American railroads. Mr. Maxwell estimates that if this vast amount could be routed over Canadian roads by the short rail-haul he suggests, through the building of 200 miles of railway to connect with the Transcontinental at Quebec bridge, that the saving to Canadian farmers alone would be 120,000,000 yearly and the revenue to our national lines would be almost sufficient to pay off their deficits.
Statements such as these if backed by facts-and the people of St. Stephen are anxious for investigation -transform the development of St. Croix harbor into a great national project. There are about twelve miles of harbor, sufficient according to expert testimony to shelter the navies of the world, and this great port has a natural breakwater in the island of Grand Manan. It is stated that there is a sixty-foot depth throughout this expanse of water and that practically no dredging would be needed.
The suggested construction of 200 miles of railroad in order to connect this port with the Transcontinental at Quebec would probably be frowned upon at the present time, when Canada is already over-burdened with railroads. But when it is considered that the construction of 200 miles of railway will make this port the nearest point on the Atlantic seaboard to Winnipeg, cutting below the present rail-haul to Portland by over 100 miles, and when it is realized that the port is open all the year and that it could be developed to look after the whole winter grain trade of Canada, it will be seen that the project deserves very serious thought. It is not merely the dream of a visionary. The people of St. Stephen and of the whole of Charlotte county are solidly behind the scheme. They believe they have the door which Canada needs for they feel there is no other port which provides the unique advantages and is so perfectly situated geographically to handle the fast growing volume of Canadian trade during the winter months.
The development of St. Croix would not mean that St. John would no longer be a grain port. The construction of the railway would also place St. John sixty miles nearer Winnipeg than is Portland and St. John could be developed to its capacity. There would be plenty of business for both. St. Croix at least deserves the very serious consideration of the federal government, and of the railways.

The Budget-Mr. Grimmer
That comment coming from a paper published in St. John is very agreeable to those who are making exertions for the development of St. Croix harbour. The policy pursued in Canada in the past has been such that we have been adding enormously to our railway mileage without enlarging our ports to any appreciable extent. Is it not a recognized fact that in any country where facilities ahead of the actual requirements have been provided an enormous development has taken place with a resultant increase of trade and of population? It is an unchanging law in economics that exports, in the end, have to be paid for by imports. We should encourage shipping in both directions-from our ports in Canada to European ports, and from the ports of Europe directly to Canada. Such a policy would not only help to find a market for Canadian manufactured goods, but would also assist the Canadian consumer by enabling him to receive goods from the European markets not obtainable in Canada as cheaply and as directly as possible.
We believe in Canada. We have great faith in the future of the Dominion. Still, are we as Canadians doing our best to bui'd up our own country rather than the United States? If we are, may we not ask ourselves the question why we should be giving even one-half our export grain trade to a United States seaport? What we need are such grain rates on our railway's as will develop trade through Quebec, Montreal, Halifax, St. John, St. Croix, Vancouver, or any other Canadian ports in preference to ports in the United States. But if we develop St. Croix harbour we can take care of all our export trade. Is it not a matter of interest to every Canadian that every possible bushel of grain should be shipped out of Canada through a Canadian port; and is it not of just as much interest that every ton of goods imported into Canada should enter through a Canadian port? If that hope were realized our railway deficit would soon be lessened and there would be fewer empty cars going west along our railways. The utilization of St. Croix harbour does not concern the people of Charlotte county alone. It will not only be a benefit, locally but it will result in national benefit, it will be profitable to Canadians as a whole. If this port, is made use of the development of trade as a result will be such as to dispel, to some extent, the dark cloud of gloom which seems to have settled upon the farmers of the West, judging from the speeches of some of our Progressive friends, with respect to the future.

In summarizing the situation which exists in connection with the harbour of St. Croix we have these advantages to offer: The port will be a terminus of a Canadian railway system running entirely through Canada. We have the greatest natural harbour on the Atlantic coast of North America. The harbour is well sheltered and there is a straight run from the Atlantic ocean into the port with a good depth of water the entire distance There is ample accommodation for the fleets of Europe, and no dredging is required. The port is fifty miles nearer Liverpool than any port on the Atlantic coast except Halifax. It is 100 miles nearer Winnipeg than Portland, Maine, by the proposed route. It is 200 miles nearer Winnipeg than St. John by the proposed route. It is 370 miles nearer Winnipeg than Halifax by the proposed route. In conclusion, Mr. Speaker, let me say that the project I have placed before the House is feasible, is advisable, and is not only in the interest of our railways but will be advantageous to Canada, and the Canadian people as a whole.


Lewis Herbert Martell: Mr. Speaker, I wish to say at the outset that it is not my intention to occupy any undue amount of the time of this House, and that in the course of the few remarks which I intend to offer I shall not discuss the tariff in a scientific way, nor follow some of my Progressive friends through the mazy labyrinths of political economy which they have outlined.
Before getting down to my speech I wish to discuss briefly the remarks of the hon. member for South Bruce (Mr. Findlay) who spoke yesterday. He was very profuse in his expressions of regret with respect to the policy of the Liberal party, and seemed to be very much put out because that party had not put into force the so-called tariff platform of 1919, which necessitated his leaving the Liberal fold. My hon. friend should have been surer of his facts, because he forsook the Liberal party and opposed the Liberal idea prior to any time during which that party would have had an opportunity of putting the so-called platform into effect. However, I am glad to know, and many gentlemen on this side, I believe, are glad to know, that the hon. member has still a spark of Liberalism within his breast, because I believe if that were not so, good and honourable as he may be, he would "be as Sodom and like unto Gomorrah.'
I am not going to take up the budget from a scientific standpoint. In the course of my remarks I am going to be somewhat local,

The Budget-Mr. Martell
and am going to endeavour to place before this House some of the matters as I see them, that are of interest to the Maritime provinces. I am not going to discuss tariffs.
I do not know very much about scientifically making them, however, I am opposed to any tariff which has for its object protection for protection's sake. I have not changed my idea one iota in that respect. I am a low-tariff man. I was elected on a tariff-for-revenue platform, and I believe, in the light of all the conditions obtaining in Canada at present, the tariff policy which has been brought down by the Minister of Finance (Mr Fielding) cannot be characterized as other than a tariff for revenue. People in this country are clamouring for government ownership of railways. I am not going to give to any extent my reasons why I may be, in some respects opposed to government ownership, but if the railways of Canada last year had a deficit, we are not going to get the money for the purpose of paying that deficit unless it is by some sort of a tariff, or by direct taxation upon the people of the country, and I believe the people of Canada are so pressed down by taxation, municipal, provincial and federal, that they are not prepared to accept any more direct taxation at the present time. I believe that if my hon. friends would, at least, meet this question in a spirit of compromise, and say that they would be prepared to give up government ownership of railways, in order that they might get low tariff, then, with the result we have to-day, the fifty millions of money spent to meet deficits on the railways might go towards the lessening of the tariff. So long as the country is advocating government ownership, just so long will it be necessary for the people of Canada to get their revenue from tariff sources, and the sooner we come to a realization of the fact that there is no royal way for the country to secure money, and that there is no other method than by taxation, the better for all concerned. I believe I can say of the hon. Minister of Finance, in so far as the tariff is concerned, the words of Goethe, "All I have done, I have done in a kingly way, and let tongues wag, what I saw to be the right thing, that I did." That I believe is the attitude and state of mind that animated the Minister of Finance in the budget policy.
He has divided his budget into various heads, and I am going to deal with one of the most important from my point of view, or more properly I should say, from the standpoint of the constituency which I have the honour to represent, namely, in regard to our
relations with the United States. Some of my hon. friends will say, "Your constituency in 1911, when it had the opportunity of securing reciprocity, defeated that issue at the polls". I can say that also to my hon. friends from the province of Manitoba, but I do not say it in a bitter way, as I believe it is to the everlasting disgrace to the people of Manitoba and of Nova Scotia that they defeated reciprocity. But the people probably did not have the matter properly placed before them at that time. Matters of reciprocity were not discussed on their merits. People on the other hand were carried away from the issue by flag-flapping and all sorts of special pleadings. The government to-day has placed in the budget an offer of reciprocity to the United States. It is true it has not so far met with a great deal of favour in the United States. It is probably not receiving very much favourable - comment from certain sections of that country. The government .has gone further; they are asking parliament to give them the right of negotiating with the President of the United States, if at any time they feel the occasion is ripe. These are, I say, outstanding characteristics of the Liberal party's policy and they show that they are always prepared, on all occasions when the time is ripe, to fulfil all the pledges they gave to the people of the country. I am for reciprocity. I do not apologize from any standpoint for my tariff views, and I am supporting the budget, not on account of the element of protection in it,-though I know that a budget which has for its object a tariff for revenue, must incidentally give some protection-but on account of it being a tariff for revenue, and irrespective of the incidental protection that results therefrom.
At six o'clock the House took recess.
After Recess
The House resumed at eight o'clock.


Lewis Herbert Martell: Mr. Speaker, when the House rose at six o'clock I was dealing with the offer of reciprocity as contained in the budget. I need not dilate upon the benefits that would accrue to the people of the Maritime provinces were we in a position to secure reciprocity with the United States. The government has done everything possible to that end. With a view to showing how reciprocity would affect one of the chief industries of Nova Scotia, I crave your indulgence while I place upon Hansard a brief statement with respect to the fishing industry in that province.
The Budget-Mr. Martell

Some time prior to the coming into force of the Fordney tariff the people of Nova Scotia as well as of the other Maritime provinces could get their fish into the United States, which was their chief market, but the Fordney tariff now makes it almost impossible for them to do that. The injury that is done to the fishing industry of my province as a result of the Fordney tariff will be realized from the following comparison of the duties under the Fordney tariff and the Underwood tariff respectively on fish and fish products which constitute one of our main exports :
Article Underwood Tariff Fordney Tariff Fresh or frozen halibut mackerel
or salmon..	..	Free	2	cents	per	poundAll other fresh or frozen fish, except shellfish	..	Free	1	cent	per	poundDried fish	
Free	1J	cents	per	pound
Pickled herring and
Mackerel... Free	1	cent	per	poundFinnan Haddie	..	Free	25	per	cent ad
valorem
Smoked herring .. J cents per pound 2$ cents per pound Green salted cod,
	 Free	cents per pound
Cod oil	3 cents per gallon 5 cents per gallon
As I have already stated, the United States had always been our chief market, having usually taken over 40 per cent of our total exports of fish. Of course, some of the fish imported into that country were for re-export. The following is an estimate, based on the business done in 1920, which was a normal year in the industry, of the duty collected on Canadian shipments of fish and fish products to the United States, and what that duty would have been under the present tariff. From the whole of Canada the total value of the fish exported to the United States was 815,541,517 and the estimated duty collected was $72,558. Under the Fordney tariff the duty would have been $1,710,055. From the Maritime provinces we shipped to the United States fish valued at $9,075,457. Under the Underwood tariff the estimated duty was $15,842; under the Fordney tariff it would have been $933,887. You will thus see that the United States market and low American tariffs or reciprocity is necessary to our fishermen if we are to survive in the fishing industry. Is it, therefore, any wonder that we in the Maritime provinces are looking for the markets of the New England states for our fish? The only way in which we can get that market is through reciprocity. If we had in force a reciprocal arrangement such as was made by Mr. Fielding and Mr. Paterson in 1911, we could put our fish on that market free of
I Mr. MartwU.]
duty. To-day our people are still looking forward to the day when they will once again have the opportunity of carrying out a reciprocal agreement with the United States; because I believe, Sir, that if the question were placed before the people of the country today they would not repeat the mistake which was made in 1911.
Now, there are several phases of the question that might be dealt with, but I want to refer more particularly to the effort which has been made to get this measure of reciprocity. I stated before recess that the government of the day had gone a long way in this direction; they have not only placed a declaration for reciprocity in the budget, but they have asked parliament to give the Governor in Council authority to appoint one of the ministers of the Crown to carry on negotiations to that end with the President of the United States if at any time the conditions seem favourable. But to-day I think we have a weapon in our hands whereby we could to some extent force recognition from the United States authorities. I am not one of those who believe that because the United States people have set a high tariff wall against us we should retaliate by setting up an exceedingly high tariff wall against them. I do not believe, Sir, that that is good Liberalism. There is something of the milk of human kindness in the breast of the Liberal party; we are more inclined to follow the Biblical injunction to turn the other side of the face.
However, we have a weapon, I believe, in	our hands.	Every	person
here knows that as a result of the treaty of 1818 the United States authorities renounced forever the right to come within three maritime miles of the coast waters of His Britannic Majesty 3ave for the four humanitarian purposes of wood, water and shelter and effecting repairs. An act, however, was passed by the Canadian parliament, Chapter 47 of the Revised Statutes of 1906, under section 2 of which act the Governor in Council was and is empowered to grant to the United States fishing vessels the right to come into our ports for every other purpose whatsoever. That is done by means of a license, and a fee is charged. For a time the fee was something like $1 50 per ton, though I believe of late years it has been reduced to the sum of $1 per ton. These vessels are coming in and using our ports. At the outset we would not grant any licenses to United States vessels if they were propelled by motor power or by any power other than sail, but as a result of the war when people were coming very

The Budget-Mr. Mar tell
much closer together the people of the United States were given the same rights to obtain licenses for motor craft as they were for sail craft. The result is that fhe United States vessels being a great deal further from the fishing banks are enabled by means of this licensing system to come into Canadian ports, and use our ports to tranship their catch, take bait, buy their nets, twine and all their other supplies and outfit, and ship their goods through to the United States in bond. As a result of these licenses enabling the United States vessels to make use of our Canadian ports, they can ship their fish through in bond and they go in as American fish, and thus evade the United States duty, whereas when our own fishermen come in from the banks, if they wish to sell to the United States, which in days gone by took forty per cent of their catch, they are obliged to pay two cents a pound duty on fresh fish, which is practically a prohibitive rate. The United States vessels I believe would not be able to successfully prosecute the catching of fresh fish if they were not allowed the use of our Canadian ports, and while to prohibit them from using those ports might affect cert am sections of the province of Nova Scotia to-day, particularly the merchant class who sell them supplies, I think it would be good business and in the interests not only of the province but of the country as a whole no longer to permit United States vessels to use the ports of Nova Scotia or any other ports of Canada for fishing purposes. If they were denied that privilege I really believe that it would be conducive to the United States authorities negotiating with the Dominion government for reciprocity at least in fish. I think I have stated fairly succinctly what the benefits to be derived from reciprocity with the United States would be and if I have not made myself intelligible to most members of the House they will simply have to pardon me in that regard. I have simply taken one great industry and I believe, Sir, and I say it without fear of contradiction, that I have demonstrated beyond all peradventure that reciprocity in fish is in the best interests of the fishermen of Canada.
Now I pass on to the question of bounties as noted by the hon. Minister of Finance. As I said before, I am not going to deal with the tariff in a scientific way. I am not capable of doing that. I have often heard it said, and I believe it has been said by many political economists, that bounties are the most vicious form of protection. If that is so, then God knows I do not want them, but I do not believe they are the most vicious form of protection. I believe they are best suited to encouraging industry. It is true that of bounties we might say in the words which Addison puts into the mouth of that fictitious character Sir Roger de Coverley "Much might be said on both sides." I have at least to my own satisfaction convinced myself that the Minister of Finance did the right thing by not increasing the tariff and giving instead bounties in order to encourage these particular industries.
I said at the outset that I was going to be brief. I believe it was St. Paul who said that a man should always be ready to give a reason for the faith that is in him, and that was my only purpose in rising to say a few words in regard to this budget. I know I shall be told by some of my Progressive friends, many of whom I admire, that I have developed into a protectionist since coming into the House of Commons. I would hurl that back at them and say that I am as much a low tariff man as ever. As I said this afternoon, I am supporting this budget because Canada needs revenue, and the primary object of this budget is to raise revenue.
I have one or two other reasons for supporting this budget. First, because I say it is a tariff for revenue, and that is the policy of the Liberal party. Secondly, because the changes in duties are made downward. Thirdly, because it increases the British preference. There are about eighty-two classes of goods on which that preference has been increased. I have not the list here although I have read it, and if any hon. member wishes to see it I will secure it for him. Fourthly, because it adopts reciprocity as a permanent plank in the platform of the Liberal party. Fifthly, because I was elected as a Liberal. I was opposed both by a Progressive and a Conservative. I stood on the straight Liberal platform and the understanding of the people of my constituency was that if my hon. leader were returned to power the hon. member for Shelburne and Queen's (Mr. Fielding) would be Finance Minister. That is to say, he would have charge of the tariff. He has had charge of the tariff, and I believe I am only doing my duty by supporting that government whose Finance Minister has the confidence of my constituency and who has framed the tariff which I am supporting to-day. If I took any other attitude than that I would deem it my duty, Sir, to go back to my constituents and to hand them back my mandate. They knew, as I have already said, when I was coming here that I was coming here to support the Liberal party not the Progressive party, not the Conservative party because I got no support in my constituency from either. I got
2908	COMMONS
The Budget-Mr. King (Huron)
support from what are always known down there as straight Laurier Liberals.
I have also another reason. If we are going to prevent the railways which have been handed over to us from going on the junk pile it is necessary for us to raise a revenue, and the people of Canada to-day with the demands that are made upon them for municipal taxation, provincial taxation, and direct forms of federal taxation are not prepared at all times to have moneys to pay to the Dominion government when such are demanded of them. But when we have a tariff for revenue such as this, they can buy the articles upon which a tariff is imposed to suit their convenience, and they are thus enabled to stretch that taxation over a period. I am one of those from the maritimes, probably the youngest man from the maritimes, but 1 want to say this: I have faith in my party, I have faith in my country. I believe this is not a time for pessimism. There is already a bright star breaking over the horizon, and if we in this House, particularly the men from the West, will not be pessimistic but look towards the future and not go around crying, "Why art thou cast down, O my soul? and why art thou disquieted within me?" and rather give our attention to the stream of prosperity and drink of the brook of optimism by the way so that we will lift up our heads, then in this Canada of ours, which is a young country, with a Finance Minister still young, we will sing in concert:
Grow old along with me!
The best is yet to be,
The last of life, for which the first was made:
Our times are in His hand Who saith, "A whole I planned,
Youth shows but half; trust God: see all, nor be afraid! "
In other words, have faith in Canada, have faith in the Liberal party, have faith in the Minister of Finance, have faith in a tariff for revenue, and you will soon see Canada back to the golden era of Sir Wilfrid Laurier's day.


Mr. J. W. KING (North Huron):: Mr. Speaker, I desire to unite with other hon. members in the felicitations which they have extended to the hon. the Minister of Finance (Mr. Fielding). I have been a great admirer of that hon. gentleman for years, and I hope that he will long live to deliver budget speeches although not exactly of the nature of his recent deliverance.
I do not agree with the tariff as embodied in the budget speech we are now considering. Take for example the duty on automobiles. How does it operate? Why, sir, Henry Ford 
is probably one of the greatest customs collectors we have in Canada. Henry Ford collects somewhere in the neighbourhood of three or four million dollars per annum. And where does that money go? Into the pocket of Henry Ford and it will doubtless be used to defray his expenses in the next Presidential election in the United States instead of going into the exchequer of Canada.
The hon. member for Hants who has just resumed his seat said when he began his remarks that he was not a tariff expert, that he did not know very much about the tariff. Yet, almost in the very same breath he went on to state that the present tariff is a tariff for revenue only. How can the hon. gentleman advance such a contention as that when I have shown the enormous sum of money that the people of this country pay in duties on automobiles alone? Does not that one instance prove that the present tariff is a protective tariff purely and simply? Sir, it is because the Liberal party did not live up to its promises in regard to the tariff that the Progressive party is in existence to-day. In 1896 the Liberal party had a good platform and I helped to support it. Sir Wilfried Laurier was probably one of the greatest statesmen ever produced in Canada, and I heard him declare on one occasion in the neighbouring town of Listowel that if he were returned to power he would positively reduce the tariff. Not only that but that he would either abolish the Senate or place it on an elective basis. How did the Liberal party carry out their promises when they were returned to power in 1896? They acted in just the same way as they are doing to-day. I do not impugn Sir Wilfrid Laurier's motives in not putting into operation the platform of his party, neither do I blame altogether the present Prime Minister for not carrying out the pledges of his party. In the case of the former statesman we find that he and his party were deserted by eighteen Liberal magnates in the city of Toronto headed by Sir Thomas White. They were the men who kept Sir Wilfrid Laurier from bringing the platform of his party into effect and, Sir, if our suspicions are correct the same influences are at work to-day, the same influences are keeping the present government from carrying out their pledges. These are some of the reasons why the Progressive party has sprung into existence. Now, although we may differ politically there is no reason why we should differ socially; there is no reason for not entertaining a kindly spirit towards each other. But when it comes to politics there is serious ground for difference and we must differ and we must fight. Some of my good Liberal friends-and I have many yet-and some of

The Budget-Mr. King (Huron)
my good Conservative friends, say "Scratch a Progressive and you will find a Grit or a Tory." Well, they have been scratching for the last eighteen months and what have they found. The Liberal party found two members of the Progressive party that were not true Progressives, and the Tory party have found in the provincial arena in Toronto two others who were not real Progressives.


An hon. MEMBER:: Horse and horse.


John Warwick King: 
James Shaver Woodsworth: Would the hon.
member object to the federal government taking that $2,000,000 extra before the man died?


John Warwick King: Yes, I would object, for the reason I stated a moment ago, that any country on this earth, I do not care what country it may be, has to be very careful of its capital. If you take capital out of any
2910	COMMONS
The Budget-Mr. King (Huron)
country, what have you? You place the country in a state similar to that of Russia at the present time, you drive capitalists out of the country and you prevent capital from coming in.


James Shaver Woodsworth: Would it not have the same effect if the 32,000,000 were taken after the man is dead? Would not the capital of the country be affected in that case?


John Warwick King: After the man is dead he would not have any kick coming. I was particularly well pleased, Mr. Speaker, to see that an offer was made of reciprocity with the United States, the offer to remain on the statute books of Canada. I wish to follow' up that proposition for a few moments. One of the first arguments against reciprocity between Canada and the United States, by the opponents of that scheme, was that there is a similarity of a sameness in the products of the two countries. Granting that-and I do not grant it altogether-there is not one particle more similarity between the products of Ontario and the products of the state of Michigan than there is between the products of Ontario and of Quebec. There is no more similarity between, we will say, the products of Manitoba and the products of Alberta than there is between the products of Alberta and of one of the northern states. For instance, there might be a failure in the line of production in one section while another section might have an abundance in that same line, and by a system of fair exchange the balance is retained all the year round. Plums are produced in the province of Quebec six months after they are produced in California, and I could name any amount of other products which are in the same position. Therefore you would have a more uniform exchange for that reason.
There is also a diversity of products between the United States and Canada. Cotton and semi-tropical fruits are produced in the United States, whereas in Canada we can grow the best wheat in the world. In regard to the area from which certain products are produced, what have we in the Maritime provinces? We have coal and fish in abundance, and we have the New England states lying side by side with the Maritime provinces, and a water haul all the way, if we only had free trade. Then sir, what have we in Pennsylvania and Pittsburg? We have coal. But when Ontario gets her white coal, she will not need the black coal from Pennsylvania and Pittsburg. At the present time we in Ontario and Quebec have coal to the south of us. In the provinces of British Columbia and Alberta we have illimitable beds of coal, 
while in the states immediately to the south they have not this coal. What could be better than a treaty of exchange? Under the old reciprocity treaty which was in effect from 1854 to 1866 exports to the United States increased from $10,000,000 in 1854 to $87,000,000 in 1865. Our exports quadrupled in twelve years of reciprocity and the opponents of reciprocity will say that it was the Americans who got sick first. I do not know whether that is correct or not. I think it w;as on account of the favouritism-I might call it	favouritism

shown by Canada
and Great Britain towards the South in the Civil War more than anything else. When real restriction began with the McKinley tariff, the effect was more injurious and was felt with especial force by the agricultural industry of Canada. The first relief came in 1897, when the late Hon. Sydney Fisher removed the quarantine restriction. The real boom came, however, in 1913, when some agricultural products were placed on the United States free list. As a result our exports of cattle alone to the United States during the seven years from 1914 to 1929, both inclusive, was 260,000 head per annum as against only 28,000 head in 1913. Our ex ports of all animals and the products of animals jumped from less than $13,000,000 worth in 1913 to $113,000,000 in 1920. What better proof can any person get, or what better proof do we want of the advantages of a reciprocal treaty with the United States? If any stronger argument is required as to the value of the American market for the Canadian producer, it is found in what has occurred since the Fordney-McCumber tariff went into force. Our exports of potatoes alone were $447,000 worth in the first six months under the new tariff as compared with $2,000,000 worth in 1920.
When the question of freer trade relations between Canada and the Uuited States is under consideration, the discussion is generally limited to natural products; but I am going to say that I do not see why the manufacturer cannot live and do well also. I do not see any reason why the discussion should be so limited. In my opinion, reciprocal free trade with the United States in all lines would be more beneficial than a reciprocal arrangement limited to natural products. In no other part of the world are there greater facilities for manufacturing than in Ontario and Quebec. In both provinces raw material is to be found in abundance. It is true you do not fiud iron; but we have the iron if we only had the capital to develop it. That is where capi tal comes in. If you do not have the capita'

The Budget-Mr. King (Huron)
you cannot make a country; you cannot make a nation. Both provinces have power in unlimited quantities, and when we get the SI. Lawrence deepened, we shall have power galore. There is just one thing lacking-a market. With all of North America open to our manufacturers, that want will be supplied, and in a few jrnars no two states in the union will surpass Quebec and Ontario in the manufacturing industry.
I know that the late president of the Mas-sey-Harris Company said to myself: "I am ready for free trade right now." Why not?
I do not see that any government, I do not care what it is, need be afraid if ever we get an opportunity of concluding a reciprocal treaty with the United States.


Mr. SUTHERLAND:: Were the duties
under the proposed reciprocal pact of 1911 not higher on agricultural implements than they are under the present tariff?


John Warwick King: I do not know that I can just answer my hon. friend, but I do not think they were.


Mr. STEVENS:: A good deal higher.


John Warwick King: I will continue. At the present time there is between Canada and the United States a better feeling than ever existed in the past. In the Canadian parliament there are 119 followers of the Prime Minister (Mr. Mackenzie King), who have been elected with reciprocity as one of the planks in the party platform. I do not know whether they are all going to stand up to it or not. Behind my own leader there are 63 followers who have even more strongly declared for reciprocity.


Mr. GRAHAM:: They will not dare to vote against it.


John Warwick King: I do not know but the leader of the Opposition (Mr. Meighen) will support it unless he has radically changed since 1910. Therefore, there cannot be quite 50 members of this House of Commons wh" are opposed to reciprocity with the United States.
Again the United States have at the present time a president who has done more than any other man living or dead to promote world peace by the Washington Disarmament Conference. President Harding realizes that next to the piling up of armaments by nation against nation, the greatest cause of war during the last two centuries has been found in commercial rivalry and restrictions of trade brought about by such rivalry. He also realizes that nothing will do more to ensure the peace of the world to-day than the cornplete removal of tariffs and restrictions now interfering with international commerce. Examined from every angle, there never was a more opportune time for the beginning of negotiations towards the making of a trade agreement with the United States. It seemed in the past that when Canada was ready for a treaty, the United States was not ready, and vice versa. We went around with a chip on our shoulder at one time, and at another the Americans went around with a chip on their shoulder. Any boy who goes to school knows that the boy who goes around with a chip on his shoulder will eventually get some one to knock it off.
We have a great country to live in, and what we want in Canada is citizenship. It is estimated at the present time there are five million Canadians in the United States. Chicago has the largest Canadian population of any city in the United States and New York is a close second. Everywhere one goes in the United States, one finds Canadians in positions of eminence. That is the kind of people the Canadians are; no matter what country they go to, they secure positions of eminence. Have we the best possible people to take their places to-day? We have brought over shiploads of riff-raff and remnants of Europe, and we have planted them on the land. What are we going to do with them? We should have taken hold of this problem as our neighbours to the south of us have done. There they have told the foreigners to become good Americans or get out, and we ought to do the same in Canada. We ought to tell the foreigner when he comes to Canada that he must become a good Canadian or get out. That is where we have fallen down. We should at once put up the bars against all those whose children we would not like to see marry our children. We should not admit anyone who would not become as good as ourselves, and we should keep out those whose traits are dishonest and whose morals and mode of living are low.
In old times citizenship was valued; but even the Roman Empire went to pieces from two causes. One cause was the depopulation of the land, and I warn Canadians in this House of Commons that we are in danger from the same cause at the present time. The other cause was that they let anything and everything become a citizen of Rome. Let us start right away to teach every boy and girl in Canada citizenship, to take an interest in Canada. We have everything in Canada worth while. Canada is a white man's country, and I hope to see it remain a white man's country.



The Budget-Mr. Ryckman


Mr. E. B. RYCKMAN (East Toronto):: I hope the Minister of Finance will not think I am lacking in that profound admiration and respect which I certainly have for him if I frankly criticize this budget. I think the budget is a disappointing one; I believe that the minister has told us in it that he has not quite done his best. He has said that it is a budget of compromise, for a government which consists of sections is possible only through compromise. If a man is compromised he has suffered somewhat; if a woman is compromised she has suffered more; and if a country is compromised its position is still worse.
This budget has not met the challenge which every worthy, and, may I say, self-respecting budget must meet, namely, that of striking the balance. It has been announced to the world that Canada cannot meet her bills, that Canada has an unbalanced budget. Canada is in the same category as Brazil, though not to the same extent, of course-a wealthy country with large resources which cannot meet its budget and with a currency that is depreciated. That is the state of affairs, and I believe it has already had its effect. It may not be that the relationship of the New York exchange market to our budget is perfectly distinct, but New York exchange has risen since this budget was announced. When a household is unable to balance its budget that household is on the wrong road; and it is the same with a country. The budget could have been balanced, it seems to me there is no question about that. However, that is something to which I shall refer later on. The failure to face the situation squarely means that this country will suffer from the bare fact that there is a discrepancy, which has to be taken into consideration although it is not a very large one; and we shall find that throughout this year Canada will be subject to a disability that will come from the reputation of an unbalanced budget.
The fact is that the budget has tried to satisfy too many factions. So to speak, there is a little blood let here, a small poultice applied there, a hot bath given and a cold douche administered; and we are expected to be satisfied with this. From the reports that have appeared in the newspapers, it is abundantly clear that the Canadian people do not feel that in the budget which has been brought down by the minister the requirements of the country, its necessities as they exist to-day, have been met. There are many matters to which I should like to refer, but in the time at my disposal I do not think I shall be able to deal with them all.

There is one small item I would take up first of all, and that is that the incidence of some taxes on certain businesses that might be described as summer trades has been changed, but the change does not come into effect until the first of August. I do not know whether the reason is that the Finance Minister is in league with the weather prophets or whether he knows for a certainty that we are not going to have summer until the first of August. It is to me quite manifest at any rate that since the Minister of Finance has said that the change was desirable and since these particular businesses are summer trades, the change in this respect should be put into effect now. I offer that suggestion respectfully for the consideration of the government. There is one feature of great merit in this budget and that is the assurance that we shall have stability in this country. Canada needs stability, for there cannot be any sustained effort in industry, no matter in what branch, unless the people engaged therein can feel assured that there will be some certainty in conditions. That assurance has been given by the Minister of Finance and I believe it will be lived up to. But we have it from the Minister of Agriculture (Mr. Motherwell), who comes upon the scene, that this stability does not and will not exist, that there is no finality, and that we may expect changes to continue until we have that condition which the Liberal party has declared in the past that it would endeavour to bring about. However, I prefer to take the express statement of the Minister of Finance. There has therefore been given to the manufacturers and their workmen this assurance of stability; but so far as I can see nothing of a similar character has been offered to the farmers.
First of all, let us consider this sales tax. I consider that the imposition of this tax and the method provided for its collection are, if I may use the word, cowardly, in this respect in that there are a couple of thousand manufacturers and importers in this country and hundreds of thousands of jobbers and merchants. What this tariff proposes to do is to call upon the manufacturers and the merchants to do the collecting of this revenue and to account for it to the government. What happens? The manufacturer levies the 6 per cent; the jobber then levies his profit on the manufacturer's price plus the 6 per cent. Jobber No. 2 then comes along and exacts his profit on all that has gone before; and, as we were told at the last session of parliament, there were in some cases seven intermediaries, jobber No. 3 and those who follow him secure their profits in a similar way, with

The Budget-Mr. Ryckman
the result that when the farmer or the housewife or the labourer gets these goods, with all these profits added to the price, the tax really is not only 6 per cent, but has increased by as many times as a profit has been added. The farmers therefore get no benefit from the tax, and it will be found that less revenue will be collected, while there will be more expense involved in the collection of the tax.
Let me say a word with reference to the income tax, which has been dealt with by the hon. member for Huron (Mr. King). But before I speak of that tax I want to refer to an incident that occurred in this House last year. The House will find a reference to it at page 3241 of Hansard of that year. The occasion was the discussion of the duty upon cigarettes which this year has been taken off. I rose in the House then and told the Minister of Finance that while I did not desire to be considered a champion of the cigarette trade, at the same time representations had been made to me from which it was obvious that there must of necessity be a loss of revenue if the tax which he proposed then was put on cigarettes. I declared at that time that so obvious was this to me that I desired to go on record in the matter. The minister replied that representations had been made to him also, that he had considered them, and that the matter was doubtful. But he was determined to impose the tax for the then current year, and if it was found, as represented, that there was a loss of revenue the tax would be taken off.
The Finance Minister was as good as his word; the tax was taken off, and there was an immense loss of revenue. The loss, as was stated during the course of this debate, was 15,000,000 in connection with the tobacco trade and $1,200,000 on the item of cigarettes alone. How this should have been allowed to occur I cannot understand. I do not think the Finance Minister gave the matter his personal attention; he probably relegated it to his adviser in the department. I think that that gentleman, or whoever was responsible for the decision which meant a loss of revenue to this country of $1,200,000 should lose his position. It was plain that that result would follow, and there should be no chance of such a thing occurring again.
With regard to the income tax, with its surtax and its supersurtax, I am of the distinct opinion that this country is losing money every day by its imposition. It is lessening production and I believe it is lessening revenue. It is deliberately cutting off the limb upon which sits any chance for the growth of industry in this country. I feel very strongly on this point, and I hope I may be able to convince the government that that is the view to be accepted. Let me develop the point a little; the argument is not mine originally, but every reasoning fibre of my being is responsive to it. One of the chief fallacies in taxation is that if you levy the tax at the top, the bottom will escape; in other words, that if you levy the tax on the lieh you will avoid imposing it on the poor. That is an absolute fallacy. In the next place the income tax is altogether unfair; it means the imposition of a levy on those who have worked and saved, for the benefit of those who will not work and will not save. That is the doctrine entertained by some of my friends to my left, and when you get to the extreme left you have the doctrine which would go to the extent of taking away all capital from the rich in order that the poor might benefit. The idea would be fine if it worked, but it does not work, it never has worked and in the nature of things it never will. In this connection I want to adopt the argument of Mr. Otto H. Kahn, a distinguished banker and publicist of New York, a German by extraction whose conduct during the war was admirable, and I have great pleasure in quoting his views. He says:
The usual advocate of the income tax says: "Supposing the rich man is made to pay two-thirds or more of this income in taxes. He still has plenty left." The user of this argument can see no farther than his nose. He forgets that the income tax drives capital out of constructive use in the first place.
In the second place, it reduces the incentive to venturing to the vanishing point, so that capitaJ will not undertake new work.
In the third place, money that ought to be used in the expansion of the country's business and the prosperity of the whole people is drained into the coffers of the government.
Again, it amounts to a campaign against thrift. Why save when the government will rob you of your savings? The income tax is half brother to the inflated currency of Germany and the confiscation policy of Russia. It promotes extravagance and discourages industry among' the rich.
The one point that is overlooked is, as Mr. Kahn points out, that the income tax and surtax defeat their own purposes. Greed, envy, and injustice always overreach themselves. The result of these excessive taxes is not only that capital turns to tax-exempt securities for investment, but it takes every legally permissible dodge to escape intolerable taxation, while a reasonable tax would willingly be paid.
That this is not theory but actual fact is proved by statistics, which show an enormous reduction in the revenue derived by the government from large incomes.
The government referred to is, of course, the government of the United States. They have reduced their income tax. The United Kingdom has reduced its income tax by one-third since the war began. Canada is the only nation I know of that has increased its income
The Budget-Mr. Ryckman

The Budqet-Mr. Ryckman
met in a special way. The Finance Minister has said-has said it several times in my hearing-"Oh, it is difficult to raise money for the war debt. It was incurred while the war was on and there was a patriotic and most commendable feeling in the public mind. Bonds could be sold and money was cheerfully contributed by the people because it was for the carrying on of the war. But that is all past and the money cannot be raised now." I contend, Mr. Speaker, that the very same spirit could be depended upon to raise revenue-perhaps not to as great an extent but still to a very considerable amount -in this country to-day if the governmenc would only adopt the right method. What method would I propose? Well, I would take the sales tax which is so objectionable to some and I would scrap it. I would then introduce what is known as the "turn-over" tax. That is well understood by all the members of this House but in short it is this: There should be a tax levied upon all processed goods, and upon all annual services in the case of doctors, dentists, and other professional men. Speaking of processed goods I would say the tax should be in turnover to the extent of $10,000 annually, using that figure only for the purposes of illustration; in the case of professional men it should be applied to incomes of $5,000 annually. The turn-over tax should be one per cent and whatever that tax yielded should be applied to war expenses, interest on the debt, pensions, and so on; but that not one cent of revenue from that tax should be paid for any other purpose than war expenditure. Mr. Speaker, I am satisfied the amount such a tax would yield would take care of the necessary war expenditure that we have and, together with a properly graduated income tax, would provide even for the railway deficits. This tax has been tried in Switzerland and has worked well; but we would be satisfied with knowing that this tax of one per cent, which I have mentioned for the sake of example, would not be objected to. Who would object to paying one per cent on $10,000 a year? Who would object to paying ten cents on any $10 article he purchased? No one at all, especially if it were known that the revenue from it would be devoted to meeting war expenditure exclusively. Mr. Speaker, it has been said that after the Battle of Waterloo in 1815 the lament of the next generation of young English boys was that they had not been of an age which would have permitted them to have taken part in the wars in which
I Nfr. iljvkioan.]
Great Britain triumphed so magnificently. I want to say that if opportunity were given our people to contribute of their means to war expenditure they would gladly subscribe if they knew the money would be solely devoted to meeting war expenditure. The spirit which was so splendidly exhibited during the war is still alive. The young men who will succeed us, if the tax is still in existence, will know that in bearing it they were upholding the sentiment that the Canadian nation upheld and fought for during the Great War. I say, Mr. Speaker, the Finance Minister does not know the immense amount of money that would be willingly given by the nation for this purpose. No one would default in payment of this tax, few would try to do so. But consisting in the main in small amounts the total revenue to be derived from this source would largely meet the burden that now rests upon the shoulders of the people and which, owing to our confused system oi finances, is of such a character that no one really knows how much money is taken or how it is expended. If, after the imposition of such a tax the budget failed to balance I am quite sure that by practising the real economies I have spoken of the ill would be cured.
We are told that the farmers are still suffering and that they have a strong antipathy to a protective tariff. Really I have been much amused during the progress of this debate to observe some of the statements which have been made. For example, the leader of the Progressive party during his speech said that he lived close to the international boundary line, and that he could buy more cheaply on the other side of that line and that he could obtain a higher price for his products. I could not help but think that the hon. member should have paused for a moment to consider where that kind of argument led him, because if there is any country in the world that has a tariff "as high as Haman's gallows" it is the United States. There is where you have a real high tariff protectionist country. Yet the leader of the Progressives tells us that we ought to have free trade in Canada, and that if he crosses the boundary line into that highly protected country which is so near to him he can buy-he did not say everything- but he can buy many articles much more cheaply and if he went to sell his farm products he could get a much higher price. A short time ago I had the pleasure of reading a biography of William Henry Seward, a very distinguished man, an Olympian, who was overtopped only by Abraham Lincoln. He was the Secretary of State in Lincoln's cabinet

The Budget-Mr. Ryckman
He was an orator, a patriot and a public man of the highest integrity, and in making a political speech seventy-five years ago, before any of the Progressives were born he said:
Industry falls into three classes in this country, agriculture, manufacture and trade.
He said also:
Some say that agriculture is a basic industry. It is but they are all basic industries. The three of them are so associated and dovetailed together that it is impossible to benefit one without benefiting the others.
It is impossible to do an injury to one without hurting the others and equally it is impossible to in any way do anything which will displace one either up or down without affecting the other two.
He said further:
There are some who argue in favour of a lower tariff. I will admit that if this world were composed of a number of Utopias, theoretically the argument is correct, but I have lived in this country, and I have seen that every time the tariff was advanced this country prospered and every time the tariff was lowered this country suffered. With that experienc I can do nothing else than say that I am for a higher tariff.
And he concluded by saying that the prosperity that the United States had up to that time-and it was borne out by the history of the United States-had been brought about by the high tariff imposed. It is the same thing to-day, Mr. Speaker. We are told the United States is prosperous. We are not prosperous to the extent the United States is, and I submit the reason is that we have not enough tariff protection. Only a short time ago, through the kindness of the Minister of Trade and Commerce (Mr. Robb) there was distributed to us a memorandum showing that there had been imported into this country during the last twelve months $208,000,000 worth of farm products, brought in to compete with the products of our Canadian farmers. I can only say, Mr. Speaker, that if I had the opportunity I would make it perfectly certain that any taxes which the United States imposed upon farm products going into the United States from Canada *would be imposed by Canada upon that $208,000,000 worth of products that came into this country, and I would make it abundantly plain that any man who wanted grapefruit for breakfast would know he was paying for it, and that he could get a Northern Spy apple at much less cost than he could obtain grape fruit or foreign fruit from the southern parts of the United States. I do not see why that argument is not sound, and I believe the course I suggest is in keeping with our selfrespect. Why should we as a people admit produce from the United States amounting to more than one-fourth of our total imports and not tax as freely as we are taxed? That is the self-respecting course in dealings between man and man. You are not going to allow one man "to put it all over you," as the saying is, and so I say that much of these ills that we have suffered, much of the deficits that we have to meet by taxes levied upon ourselves, could be taken care of by a proper tax upon the $208,000,000 worth of the products of the farm, because it includes food and all products as well.


Mr. PUTNAM:: Does that include all fruits?


Edmond Baird Ryckman: I would think so. I have no doubt the hon. member received the same memorandum, and the item will be found in the first two lines of the memorandum. We have $208,000,000 of farm products, one-fourth of all our imports, brought into Canada from the United States. I submit if we provided for an item of that kind by adequate taxation, and if we met the difficulties of the western provinces with regard to transportation-and I believe there is a difficulty there-we could without trouble, without great sacrifice, with the money derived from such a source, pay something like $20,000,000, which would mean 5 cents a bushel to the farmers, when they transport 400,000,000 bushels of grain. If there were a nationalpolicy inaugurated for the farmers at this time, founded upon the necessities of the farmers, and in order to meet their difficulties, there would be great sympathy in this House and in the country. But at the present time, when our friends to my left are railing against a protective tariff, and when, as I say, it seems that the opportunity will not come to them very soon of converting anybody they ought to cease worrying us with attacks on the tariff, if they think otherwise, I would advise them to commence operations on the two members who recently left them, and have now joined the party which stands for a high tariff as some people put it. But let us forget about that and struggle to alleviate the conditions which are certainly oppressing our western farmers.
In regard to the reciprocity resolution I take an altogether different view from the one propounded by the hon. member for North Huron (Mr. King). I think these resolutions do not comport with the dignity of this country. I think they are also unseemly. It is something like the lady proposing and when the lady proposes the person to whom she proposes generally cools off a little 'bit anyway. It often results in a very distinct and lasting coolness. There was a failure in 1911 to obtain reciprocity, and I have heard our respect-

The Budget-Mr. Ryckman
ed and honoured friend the Minister of Finance (Mr. Fielding) speak of this on three or four different occasions. On two occasions he has said-
There is a tide in the affairs of men which taken at 'the flood leads On to fortune.
The day before yesterday the Finance Minister, before the Banking committee, described as a crime the fact that the reciprocity pact of 1911 did not become law. I think that it never should have become law in 1911, and it did not, and that it should not become law in 1923, and it will not. I know that the Finance Minister is absolutely sincere about that; there is no doubt about it.


Harold Putnam: Should it have become law in 1854?


Edmond Baird Ryckman: That was before I was born, and I cannot answer the question.


Harold Putnam: It is a short time in the history of a nation. I asked if the hon. member thought reciprocity should have become law in 1854.


Edmond Baird Ryckman: I feel satisfied that I could not answer that question to my hon. friend's satisfaction, because I am not familiar with the facts. My first connection with political life was when this country suffered by reason of the United States doing as it could do in 1911 and afterwards, and as it could do n 1923, namely, disrupt the pact and throw .his country upon its own resources absolutely, when it had been accustomed to deal with the United States. It would be all very well if proper safeguards were provided which would properly care for trade relations in reciprocity agreements with the United States. But that is the point I was coming to. I have had a large experience with the United States.
I have been interested in business there.
I have spent a good deal of my time in the United States. I think I have been in the capital city of the United States as much as any member of the House. I have sat in clubs of the United States for twenty years and have heard these questions discussed. I have come to the conclusion-and I say this with all seriousness; do not let anyone think that I am girding at the United States-that the United States, as regards their patriotic view, are the real Sein Feiners of the world -for themselves alone. The United States would enter into a reciprocal pact with Canada at any time that this was to the advantage of the United States. The United States would crash through any reciprocity pact with Canada at any time that this was for the advantage of the United States. Do hon.
I Mr. Ryckman.]
members not think that is so? What is the lesson of the late war? Remember I am not in any way saying that the United States has done one thing that, as a nation, it was not entitled to do. Nations as individuals must take care of themselves, and the United States certainly does so. What did they do in the late vvar? We were in that war, Great Britain was in that war for two years and eight months before the United States came in. The United States came into the war, and they say they won the war. It was, therefore, their war, and from the beginning during the two years and eight months, they took, as they had every right to take, this gold which is in their coffers to-day. Then the question arose of settling up the debts of the war, the war which they will tell you frankly they have won. I have heard a general in the army, officers in the executive offices at Washington, and army officers argue with me to a demonstration, as they thought, that the United States won the war. When the war was over, Great Britain offered to forego the debts which the Allies owed to her. When the proposition was made to the United States, the United States declined. The United States had a perfect right to ask Great Britain to pay her debt. Great Britain is not complaining; Great Britain will pay it. But there is nothing that. I am surer of on earth than that if the reciprocity pact or any other international agreement were made with the United States, and it became of interest to the United States, of vital national interest for the prosperity of its people, to crash through that agreement, the United States would do so. That being my view, I certainly cannot feel that this country suffered anything by not accepting the reciprocity pact of 1911, and I think this country as a self-respecting contracting nation has lowered its standing as such by putting before the * face of the whole world that it is offering to deal with the United States, the United States having taken the stand that it has taken with regard to the late war and back again, as more closely related to ourselves, when it dosed out the trade agreement that we had in years gone by, which action put this country on its back, so that for a long time it could not recover until the National Policy of Sir John A. Macdonald gave this country an opportunity to breathe and live again.


Harold Putnam: Would the hon. gentleman cite any agreement that the United States ever crashed through? He used that harsh term twice.


Edmond Baird Ryckman: I want to be absolutely fair in my statement to the House. By the

The Budget-Mr. Hughes
term, "crashed through," I do not want my hon. friend to understand that I was speaking of a breach of agreement. A more felicitous expression would be to say that they would put an end to it whenever it suited their purpose to do so. To my mind it is a great pity that this country has not the same opinion of itself that the United States has of itself; that this country does not determine that what it shall do shall be for the benefit of Canada first, because that is the duty, I submit, of this parliament. We are walking around, making overtures to the United States, and the wire comes back hot from Washington on the 16th May that a proposal of this kind will not be entertained now. What would have happened supposing we had had reciprocity in 1911 and that this farmer bloc, which is the reason that the Fordney-McCumber bill is law in the United States to-day, came into existence; supposing that reciprocity had existed and it was contrary to the interests of those farmers in the United States that Canadian farmers should have a benefit, do you mean to say for one moment that they would not have insisted on their rights? Certainly they would; they would have asked that this reciprocity agreement inaugurated in 1911 should be cancelled. The United States will be very glad to deal with us as long as we can offer her a consideration and as long as everything is flowing freely her way. But just the moment that boot is on the other foot, there is a distinct change of attitude on the part of the United States. They want to retire from any obligations that would in any way mean loss to them.
In conclusion, I was put in mind by the hon. member for North Huron (Mr. King) referring to ancient Rome and what was going to happen to us, of what we all used to read in our history books of the days of ancient Rome in the time of Marcus Cato; Cato, the censor. Whenever Cato addressed the Roman senate, no matter what the topic was, he concluded every speech, without regard to the relevancy of the remark, with "Delenda cst Carthago"- "Carthage must be destroyed." Scipio Nasica his rival on the opposite side of the senate then got the habit of concluding his speech with the statement: "In my opinion I think that Carthage should be left standing." I would that I could conclude this speech with an injunction that would have the success that Cato's had, because his advocacy won the destruction of Carthage; the Romans finally determined upon that, and Carthage was destroyed. If I could lay an injunction upon this House, it would be this, that we must practise economy; and

 |
if ever the day comes-and I believe it will
come because I think the people of this country will insist upon it-when that injunction will be met and satisfaction given to the people of Canada by economy, real and earnest, put into practice, I for one will feel that I have not spoken altogether in vain in urging in an imperfect way that the expense of this country could, if a determined effort were made, be cut down to a figure that would surprise even the members of the House themselves.


James Joseph Hughes: Mr. Speaker, some years ago, in fact a good many years ago, when I was learning to write in a country school, the teacher in those days set headlines for the pupils who were learning that craft, and our teacher rather prided himself upon the number of aphorisms that he could use on such occasions. One of them that came under the letter "M" ran as follows:
Many men of many minds,
Many birds of various kinds.
As I have listened to the speeches in this debate, in fact as I have listened i\o all the speeches in parliament, I have been driven to the conclusion that there was a good deal of truth in the first part of that aphorism, because there is certainly great divergence of opinion as regards the budget and nearly everything discussed under it. I read somewhere that in a multiplicity of counsel there is wisdom and I thought that was a very wise saying. But I have changed my mind in that respect. I have also read that much speaking dark-eneth wisdom, and I think there is something like that in the book of Job. Well,jl have come to the conclusion that there is a good deal of wisdom in that statement. But notwithstanding that fact I may be a sinner to some extent to-night. I trust however that what I say will not have the effect of darkening the vision of parliament because I would not fall into the same error that some others have fallen into.
Unfortunately, I did not hear the budget as delivered by the Minister of Finance, but I had the privilege of listening to the speech of the chief critic of the opposition, the hon. member for West York and ex-Minister of Finance (Sir Henry Drayton), and I read it afterwards besides. If I were to judge from that mild criticism that he indulged in, a criticism in fractions of fractions, I would conclude that the budget was unanswerable, because he made no real attack upon it. And that hon. gentleman is the chief critic of the opposition. I might almost say the same thing of the speech
The Budget-Mr. Hughes

delivered by the leader of the Progressive party (Mr. Forke).
There is an assumption running through the speeches of the Conservatives in this House that some one is responsible for the tremendous taxation and the enormous public debt under which the people of this country are staggering at the present time, and the assumption seems to come from our friends opposite that they are not responsible, that they are the men who can wash their hands of this condition and place upon some other party in the House the necessity of providing the funds to meet these enormous obligations. I totally dissent from that assumption. I see the leader of the Opposition (Mr. Meighen) in his seat; he is an intelligent man and he knows that there is no foundation for it. He knows that when the party of which he is now leader came into power there was hardly any public debt and practically speaking we did not know what taxation was. Immediately after his party assumed office the expenditure under the consolidated fund began to go up by $10,000,000 and $15,000,000 a year. But when the war started, then the floodgates were opened wide; all restrictions were removed. I know quite well, and I am willing to admit, that under war conditions enormous expenditures will be incurred, because prices will be two or three times the worth of the article, and everything will be expensive under such circumstances.


Arthur Meighen: The hon. gentleman
appeals to me; perhaps he would like to have my opinion of his statement. It is absolutely wrong.


James Joseph Hughes: What part of it?


Arthur Meighen: The first two years of
the government of Sir Robert Borden there was an enormous diminution of the national debt, the first year by almost a million dollars and the second year nearly $26,000,000.


James Joseph Hughes: I spoke of the e.penditure under the consolidated fund. The condition of the country was so good after fifteen years of Liberal administration, the revenues were so buoyant, that the expenditure could go on mounting up by $10,000,000 and $15,000,000 a year, and yet the public debt had not yet greatly increased.


Arthur Meighen: There was an item of
$15,000,000, but it was a loan to that precious creation of my hon. friend's party, the Grand Trunk Pacific.


James Joseph Hughes: Since my hon. friend and I have come into conflict on this point, I can give him a few items in regard to which the government could have exercised control. I
[Mr. Huglies.l
heard my hon. friend from East Toronto (Mr Ryckman) speak of economy a few moments ago. Well, the Conservative party were hardly in office before some 12,000 civil servants-I am giving the round numbers,-were dismissed from office and upwards of 25,000 were appointed to take their places.


Arthur Meighen: That is not right.


James Joseph Hughes: The public records will
prove it.


Arthur Meighen: Get them now.


James Joseph Hughes: The returns were brought down to the House at the time.


Arthur Meighen: Produce them now; the statement is utterly untrue.


James Joseph Hughes: Utterly?


Arthur Meighen: Yes, utterly.


James Joseph Hughes: I am surprised-


Arthur Meighen: So am I.


James Joseph Hughes: -that the leader of the Opposition should make that statement. The returns brought down by the government of which he was a member will prove the truth of the statement. I made the statement a few moments ago that when the war came the floodgates were opened, but I have already stated that under these conditions very high prices would be paid for everything the government needed to purchase at that time to prosecute the war. What I complain of however, and the leader of the Opposition knows it, is that much of this expenditure was due to premeditated arrangement whereby enormous prices would be paid, much higher than were necessary for the goods that were required. I do not want to go into this matter at this late hour of the evening, after some years have passed since these events, but my hon. friend knows that what I have said is true. He knows that in many instances no effort whatever was made by the government of which he was a member, at all events by the ministers of the Crown in some of the departments, to curtail some of these expenditures or to see that anything like value was obtained for the money expended. I am quite conservative when I say that for every dollar expended in the war at least 50 cents was either wasted or stolen, and this could have been prevented. The result is that the public debt to-day might have been a billion less than it is and taxation nearly cut in two. I do not want my hon. friends opposite to assume therefore that there is any political party in this country responsible for the enormous debt

The Budget-Mr. Hughes
which is now resting upon us, and for the heavy taxation which we have to meet, except the official opposition of to-day.


Arthur Meighen: Did that enormous
waste apply during the years the hon. gentleman's friends were associated with us?


James Joseph Hughes: My friends?


Arthur Meighen: Yes.


James Joseph Hughes: There were none of my friends associated with you.


Arthur Meighen: Are there certain hon. gentlemen on the opposite side who are not the hon. gentleman's friends?


James Joseph Hughes: The circumstances to
which I have referred existed in the early days of the war before my so-called friends were associated with the hon. gentleman.


Arthur Meighen: That is pretty hard on the Minister of Finance.


James Joseph Hughes: No, the Minister of Finance was a defeated candidate. He was not in parliament at the time to which I refer, so that he could not have been associated with it.


Arthur Meighen: Perhaps the hon. gentleman will get down a little finer still, then. Would he tell us what the articles were and where it was so shown?


James Joseph Hughes: Who?


Arthur Meighen: Well, I do not know who-whoever he likes.


James Joseph Hughes: What question did the
right hon. gentleman ask me?


Arthur Meighen: I thought perhaps the hon. gentleman might be specific say, as to a dollar or a dollar and a half.


James Joseph Hughes: Parliament is not a kindergarten. If the right hon. gentleman wishes to attend a school of that kind there are opportunities, I believe, in Ottawa. He should not descend to these little quibblings.


Arthur Meighen: I was asking you to.


James Joseph Hughes: You were asking me? You should have the information yourself without asking me.


Arthur Meighen: I have.


James Joseph Hughes: You should have had it before you became a member of parliament, and you should have more since you are the leader of a political party.


Arthur Meighen: The hon. member just intends to stay up in the air and not give us any concrete cases at all.


James Joseph Hughes: Do you wish a concrete case?


Arthur Meighen: Yes, if you have the evidence.


James Joseph Hughes: Well, I will give you one.


Hewitt Bostock: I would remind hon. members that they must address themselves to the Chair, and that one hon. member in referring to another should use the third person.


James Joseph Hughes: Very good, Mr. Speaker. We are both sinning in that respect. Now,
I will give a concrete case. When the war broke out, an agent of the largest manufacturing drug concern in the world-m America at all events-came to Ottawa for the purpose of obtaining an order for medical supplies for the house he represented. He went to the department and stated his business-and this was sworn to under oath. He was told that the department would not do business with him-that he had to do it through a middleman. It was brought out in sworn testimony that the person who really gave that order for medical supplies for the army was a boy fourteen years of age who had had one year's experience in a drug store. That boy stated under oath that he did not know what he was doing, that he put down the figures just as he was told by other people. The agent of Bauer and Black came before the Public Accounts committee and swore that his house was quite willing to furnish these medical supplies to the department at the price at which they supplied them to this boy, but when the supplies reached the department the prices were three or four hundred per cent higher. That was premeditated; that was done by arrangement; that was not an accident. And there are many others.


Arthur Meighen: It is altogether a wrong recital.


James Joseph Hughes: There were others. We can give a number of these things if my right hon. friend wishes.
The hon. member for East Toronto (Mr. Ryckman) said this evening that the government should practise economy; that failure to practise economy was one respect in which the government was derelict in its duty. Well, during the last session of parliament- that is not long ago-when an effort was made to reduce the expenditure where such reduction would work no injury to the country-the reduction preposed was a reasonable one, in connection with the Militia department-the hon member for
The Budget-Mr. Hughes

East Toronto and nearly every other hon. gentleman sitting in that comer of the House objected. Our Progressive friends, or many of them, spoke in favour of the reduction; they showed their sincerity in that regard. I have yet to find where one member of the Conservative party has put his finger upon a concrete saving that could be made by the government. They invariably oppose our efforts to practise economy, while in a general way they preach it.
The hon. member for East Toronto also found fault with the affer the Finance Minister is making to the United States in the matter of reciprocal trade arrangements. He said it was a case of the lady proposing and that generally when the lady proposed the offer was turned down. I would ask my hon. friend, did the lady propose when Sir John A. Macdonald brought in the so-called National Policy and put that very invitation in it and kept it there for forty years? It was only when reciprocity was actually obtained, only when a better arrangement was entered into than anybody in Canada could have expected, that my hon. friends discovered that they were opposed to reciprocity.


Mr. CHAPLIN:: May I ask the hon. gentleman a question? How could Sir John A. Macdonald leave such a proposal in the tariff for forty years ?


James Joseph Hughes: All parties were in favour of it.


James Dew Chaplin: For forty years?


James Joseph Hughes: From 1878 to 1911; you can figure it out for yourself. I suppose if it were thirty-nine and a half, hon. gentlemen opposite would object.


Arthur Meighen: The hon. gentleman sure-iy does not know what he is talking about. Does he mean to say that was in the act up to 1911?


James Joseph Hughes: It was a standing offer to the United States. In 1891 Sir John A. Macdonald dissolved parliament a year before its term expired, on the plea that he had an invitation from Washington to send representatives there to negotiate a reciprocity treaty, and that he wanted to get a mandate from the people to strengthen his hands in those negotiations. He got a mandate from the people; his party were returned to power, and it turned out that the statement was incorrect. Mr. Blaine, then Secretary of State in the United States, said that no such invitation had ever been sent, so that the statement made to the people in that general elec-
tion was untrue. But that was the way the Conservative party were acting in those days. Then when a real reciprocity arrangement was actually entered into, they discovered that they were opposed to it. As has been well stated, the defeat of reciprocity was the greatest crime ever committed in this country.
With regard to thei respective merits of protection and free trade, I wish to put before the House two or three propositions which I think are sound and upon which I wish to build an argument. It is generally held that when the exports of a country exceed the imports, that country is doing business profitably; that is generally held up to be a good condition of affairs. What is known as the balance of trade has not been the subject of very much reference in this debate. I think that general proposition is a fallacy. It may be correct under certain conditions, but generally speaking, trade is profitably carried on when the imports exceeds the exports. As I have said, I will lay down two or three propositions in that connection and I will give one or two concrete instances by way of proof.
I make this statement: If the exports are greater than the imports and if the exports are only paying for the imports, then we are trading at a loss, and the measure of our loss is the difference between our exports and our imports.
Further, if our exports are greater than our imports and if our exports are not even paying for our imports, then our loss is even gi eater than the difference between our exports and our imports.
Again, if our imports exceed our ex-ports and if our exports are paying for our imports, we are trading at a profit, and the measure of our profit is the difference between our imports and our exports.
Further, in such a case if our exports are more than paying for our imports, then the measure of our profit is even greater than the difference between our imports and exports.
Again, if our exports exceed our imports and if our exports are not only paying for our imports but are enabling us to pay off our foreign obligations or make foreign investments, then we are trading at a profit, and the measure of our profit is the reduction in our foreign obligations or our investments or both together.
Further, if our imports exceed our exports and if our exports are not paying for our imports and if we have to borrow money to pay the difference, then manifestly we are trading at a loss, and the measure of our loss

The Budget-Mr. Hughes
is the amount of our borrowing for this purpose.
Now then let me give one or two concrete examples to prove these propositions.
I will say that I am an exporter and that I am exporting wheat. I will take 100,000 bushels and for easy computation say that it costs $1 a bushel. I send that to Liverpool or London. The export entry is $100,000. I sell that cargo at a profit say, for easy computation, of 50 cents a bushel, realizing $150,000. I invest that in merchandise in Great Britain which I bring back to Canada. The import entry is $150,000. I have made a very profitable transaction. The import is 50 per cent in excess of the export. What is profitable to me is profitable to my country.
Supposing I am not an importer at all and I bring back a bill of exchange. That enables some other man who is an importer to bring in $150,000 worth of goods and to pay for them, because we have that bill of exchange. That, of course, will apply to every other article of commerce in which the country can be engaged.
The reverse is also true. Supposing I sell my wheat at a loss. For easy computation say I sell it at 50 cents a bushel. The export entry is $100,000 and the import entry $50,000. Our exports are twice as great as our imports in that case, and yet we are trading at a tremendous loss. So the balance of trade theory will only hold providing you take all the circumstances and all the conditions into account, but generally speaking when the imports exceed the exports the country is trading at a profit because all profit in trade, in foreign trade at all events, and I think in all trade, is made by taking things from where they are comparatively cheap to where they are comparatively dear. Therefore it follows that the imports of all the countries in the world could be greater than the exports at the same time and all countries be doing business at a profit. That international trade of itself would be one of the greatest industries that the world could be engaged in. There cannot be any question or doubt about it. There is no question in my mind that when the Creator made this world, with all its varying climates and varied production, it was His wish that the people who inhabited this world might trade with one another. The greatest good of mankind would be produced by free international trade. To my mind it would be just as reasonable to put up toll gates between Canada and the United States or between the different provinces of this country as to prevent trade from flowing north and south or between the provinces. We erect artificial barriers to prevent the
natural flow of trade. It seems to me a paradoxical thing for governments to send trade commissioners abroad, and to subsidize steamers and make treaties to promote trade, and then by tariffs to fine the people who engage in that trade.


Mr. KELLNER:: Would the hon. gentleman mind handing a copy of that article which he has been reading to the Minister of Immigration?


James Joseph Hughes: I really do not know what the hon. gentleman means.


Donald Ferdinand Kellner: I mean that article the hon. member is reading from in regard to trade balances.


James Joseph Hughes: I read from no article.


Donald Ferdinand Kellner: Well, the paper you quoted the figures from then


James Joseph Hughes: I have no objection to showing it to my hon. friend or anyone who wishes to see it. The figures will all be on Hansard to-morrow and be available to everybody.


Donald Ferdinand Kellner: The hon. gentleman's views are entirely in accord with my own, but I thought it would be well for him to hand the statement to some of his colleagues.


James Joseph Hughes: When two nations go to war and one wishes to injure the other, and injure it very effectively, if they are maritime nations particularly, the one blockades the other. That blockade is established, not for the purpose of preventing exports, but for the puropse of preventing imports, it being instinctively realized that you can injure an enemy nation far more quickly and effectively by preventing its imports than by preventing its exports.
The leader of the Progressive party (Mr. Forks) said a good thing the other day, though I suppose he was not the first to say it, when he said: You cannot sell unless you are prepared to buy. The greatest fallacj that it is possible for any man to hold has been enunciated this session and in all previous sessions in which I have held a seat in this House by the Conservative party in regard to trade matters. My hon. friend the leader of the Opposition and other gentlemen in his party say that they never change their views. Well, Mr. Speaker, there was a line of kings in France a few years ago of whom it was said they never learned and they never forgot-and they did not go down in history as being very intelligent men.
If what I have said is true, and I think it will bear critical examination, there is nothing
The Budget-Mr. Hughes

that we could do that would so promote the interest of the world or of two nations lying alongside each other like Canada and the United States as to have free trade qr as large a measure of free trade as we can have between the two nations. I have not lost faith in the intelligence of our neighboui ? to the south, and some o' ay or other they may repeat the offer they made to us. They are * quite justified now in being indifferent in meeting our offers because they made an arrangement with us that was certainly to our benefit-was to their own benefit and to ours -to a very much greater extent than we ever expected to receive from them-and we turned it down. I do not know whether reciprocity got a fair hearing in the country at that time or not, I do not think it did. It was the former member for West Peterborough, Mr. Burnham, who told us in this House that he never heard reciprocity mentioned in his part of the country but that other issues entirely were raised by the Conservative party, and issues that were not very creditable to any party. In the province of Quebec also reciprocity was hardly mentioned. There was at that time in that province a political school headed by a man named Bourassa, called the Nationalist party, and our good friends the Conservatives who wanted to defeat reciprocity joined in an alliance with the Nationalists. That alliance was afterwards called "The unholy alliance" but I am afraid the Conservative party would join in any alliance to defeat a Liberal government no matter what the consequences might be to the country.
We cannot expect world-wide free trade. Perhaps we cannot even expect free trade between Canada and the United States. The question naturally arises, if we cannot get that and if other countries maintain high tariff walls against us, would it be in our own interest to raise high tariff walls against those countries that are not willing to trade with us. Would it be in our interest? I do not think so. I have often heard the argument made that if we reduced our customs duties other countries would flood us with their cheap goods, let us examine that argument and see what is in it. For the sake of argument let us take an extreme case. Supposing other countries could send us their goods for nothing. That would be flooding us purely but would that injure us? If we could get the things we require to import for nothing, if we had to give nothing for them, manifestly that would not injure us. Supposing we got those imports very cheap at 
25 per cent of their value? That would not injure us either, could not possibly injure us, and to the extent they took something in return would not injure our industries. Supposing we got those imports for half their value the same thing would apply. Supposing we got them for 75 per cent of their value the same thing would apply. Nations do not trade with one another but the individuals that compose nations do. No two men will carry on a trade unless it is beneficial to both of them, and if it is beneficial to the people that are carrying on that trade then it must necessarily be beneficial to the respective countries; there is no getting away from that fact.
The other day in the committee on Banking and Commerce I heard the hon. member for East Toronto (Mr. Ryckman), speaking in regard to a motion that was made there, say that we should not legislate to protect grown up red-blooded men from doing that which they wanted to do themselves. That was good sound doctrine. To-night he proposes to raise tariff walls, to impose high customs duties, to prevent men living in Canada from trading with their neighbours in the United States if they want to do so and if they find such trading to be to their advantage. The two positions do not agree. Either the hon. member was wrong in his statement before the Banking and Commerce committee or he was wrong in his argument to-night.
However, we are not living in an ideal world and some $400,000,000, or nearly that amount, have to be raised in Canada to meet our obligations. The Minister of Finance has to raise that money in some way or another. Under the circumstances would he be justified in reducing the customs duty, in lessening the amount he expects to receive from that source? I question it very much and, free trader in principle as I am, I will tell you why. Any government must be guided by the people from whom it is legislating. In the case of the government that was in power from 1896 down to 1911 every change it made in the tariff was in the direction of reducing the duty. Many people in Canada thought the Laurier government was not going fast enough and far enough. A large delegation came to Ottawa in 1910 or 1911, very largely composed of farmers from the province of Ontario and aggregating some seven or eight hundred in number. They asked for lower duties and particularly that efforts should be made to bring about reciprocal trade relations with the United States. A number of men in that delegation represented the fruit growing industry. The government heard the representations of the deputation and a few months later was in a position to carry out their wishes. Did these men respond? No, they took the earliest opportunity presented to them to turn the Laurier government out of power, they were not ready to receive the legislation for which they asked. The province of Manitoba also turned down the reciprocity agreement, and I am sorry to say the province from which I come sent half of its members to parliament to vote against reciprocity, although there is not a province in Canada that would have benefited to a greater extent from it than Prince Edward Island. Therefore, no matter how convinced you are of the soundness of certain legislation, no government can proceed faster than the sentiment of the people warrants. I think it was Solon who said that his laws were not the best possible, they were not even the best he could write, but they were the best the Athenian people were capable of receiving. Take the constituency of the present Minister of Finance who negotiated that reciprocity agreement. The province of Nova Scotia, including the county of Shelburne and Queens, which is largely engaged in the fishing industry would certainly have benefited largely by reciprocity, yet that constituency voted against the government. Even if it were not necessary to raise the large amount of money which is now required, would any government be justified in going faster than the present government is doing in the direction of freer trade or of making efforts to obtain reciprocal trade agreement with the United States.
That is a question which our Progressive friends will have to ask themselves. I want to say this to them: Did they show their sincerity to the extent of 100 per cent in regard to this matter? They blame the present government for not adhering more strictly to the platform of 1919. That platform surely appealed to the Progressive party in western Canada, but was the appeal sufficiently strong to attract their support? No, in every constituency in western Canada, or in most of them at all events, a candidate was put up to try to defeat the Liberal candidate and to defeat the party that framed that platform, and that had given the proof years before that they were in favour of such trade conditions.


Mr. SPEAKMAN:: The hon. member was endowed with his spirit of prophecy then.


James Joseph Hughes: I did not catch the observation of the hon. member. I will mention an instance which comes nearer home. Since I have had a vote I have always voted for freer trade, because I was convinced it was sound policy. I voted for reciprocity. I was elected on that issue, and I came to parliament and advocated reciprocity to the best of my ability. Every vote that I ever gave was in favour of it. What did my Progressive friends do in the last election? The leader in the Progressive party came down to Prince Edward Island and assisted bis nominee against me. The gentleman who opposed me had voted against reciprocity, had stumped the country against it, and had voted against the Liberal government on every free trade measure that they introduced. Did that show 100 per cent sincerity?


Mr. GOULD:: He got what was coming to him.


James Joseph Hughes: He got what was coming to him. He was licked because he was insincere, but he had the full support of the Progressive party and had the endorsement of the leader of that party.
Now our Progressive friends should not expect so much. They should not expect any more than they have got, and they should be sincere in this matter. If this question is fundamental with them, if they are convinced that it is one of the best things Canada could obtain, then they should support the men who have proved by their work that they are sincere in this matter, and if our iriends have made a mistake in the past, let them try to rectify it in the future
These are my views on these questions, and if our Conservative friends would come to us and acknowledge that they are largely responsible for the debt and taxation of the country at this time, if they would strike their breasts and acknowledge their guilt, we would feel like forgiving them to a large extent, and forgetting their record in the matters to which I have referred and in many other matters to which I might refer. Now actions speak louder than words, and under all the circumstances I do not think our Progressive friends are justified in moving an amendment to the budget. However they are the best judges of their own conduct. I belong to that party which has consistently worked for those measures which have been dear to us all for so many years. I am convinced of the sincerity of the members of our party, and am convinced that they are doing the best they can under the circumstances in which they find themselves placed. Therefore, I am going to vote
Private Bills

against the amendment and for the budget, believing that I am working and voting in the best interests of the principles which I have placed before the House this evening.
On motion of Mr. Morrison the debate was adjourned.



PRIVATE BILLS


[Stage Direction]
Bill No. 145 (from the Senate), for the relief of Mabel Gertrude Johnston.-Mr. Mew-bum.
Bill No. 146 (from the Senate"), for the relief of Wilfrid Charles Brown.-Mr. Chew.
Bill No. 147 (from the Senate), for the relief of Gertrude Andrews.-Mr. Church.
Bill No. 148 (from the Senate), for the relief of William Henry Davidson.-Mr. McKay.
Bill No. 149 (from the Senate), for the relief of George Robert Webb-Mr. Ross (Kingston).
Bill No. 150 (from the Senate), for the relief of Katharine Bryans.-Mr. Church.
Bill No. 156 (from the Senate'1, for the relief of George Austin Trow.-Mr. Duff Bill No. 157 (from the Senate), for the relief of Ethel Jean Buchan.-Mr. Harris.
Bill No. 158 (from the Senate), for the relief of Louisa Wemp.-Mr. Simpson.
Bill No. 160 (from the Senate), for the relief of Edgar Lindsay.-Mr. Stewart (Leeds).
Bill No. 161 (from the Senate), for the relief of Charles Marigoli Hare.-Mr. Duff.
Bill No. 162 (from the Senate), for the relief of Esther Levin.-Mr. Gordon.
Bill No. 163 (from the Senate), for the relief of Hilda Marguerite Watt Black-Mr. Stewart (Leeds).
Bill No. 164 (from the Senate), for the relief of Abigal Aileen Beryl McCrae Tull.-Mr. Duff.

[Stage Direction]
Bill No. 167 (from the Senate), for the relief of Christina Julia Hamilton.-Mr. Simpson.
Bill No. 168 (from the Senate), for the relief of Smith Kain-Mr. Church.
Bill No. 169 (from the Senate), for the relief of Gladys Malcolm Mushett.-Mr. Shaw.
Bill No. 170 (from the Senate), for the relief of William Francis Rafferty.-Mr. Irvine.
On motion of Mr. Fielding the House adjourned at 11 p.m.
Monday, May 21, 1923