1924-05-08

CANADIAN NATIONAL RAILWAYS


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Mr. F. S. CAHILL (Pontiac) presented the fifth report of the select standing committee on Railways, Canals and Telegraph Lines as follows:
Your committee have considered the following bills and have agreed to report the same without amendment,
Bill No. 33, an act respecting the construction of Canadian National Railway line, Kamloops-Kelowna division, province of British Columbia.
Bill No. 34, an act respecting the construction of a Canadian National Railway line to Cowichan Bay, on Vancouver Island.
Bill No. 35, an act respecting the construction of a Canadian National RaiJway line to Mile 100 on Vancouver Island.
Bill No. 44, an act respecting the construction of a Canadian National Railway line between Hanna and Warden, in the province of Alberta.
Bill No. 45, an act respecting the construction of a Canadian National Railway line from Loverna westerly in the province of Alberta.
Bill No. 61, an act respecting the construction of a Canadian National Railway line, being a joint section from Rosedale southeasterly in the province of Alberta.
Bill No. 62, an Act respecting the construction of a Canadia'n National Railway line to Pine Falls in the province of Manitoba.
Your committee have also considered the foliowing bills and have agreed to report the same with amendments,
Bill No. 40, an Act respecting the construction of a Canadian National Railway line to Mile 41 of the Mel-fort Branch near Nipawin in the province of Saskatchewan.
Bill No. 49, an Act respecting the construction of a Canadian National Railway line between Dunblane and Mawer in the province of Saskatchewan.
Bill No. 54, an Act respecting the construction of a Canadian National Railway line between Radville and Fife Lake in the province of Saskatchewan.
Your committee recommend that the titles of the three last mentioned bills be respectively amended to read as follows: viz.
Bill No. 40, an Act respecting the construction of a Canadian National Railway line either to Mile 41 near Nipawin or in a northwesterly direction to a point in township 49, range 13, west of the second meridian, in the province of Saskatchewan.
MAY 8, 1924	186J
United Church oj Canada-Petitions
Bill No. 49, an Act respecting the construction of a Canadian National Railway line between Dunblane and Mawer or a point west thereof, in the province of Saskatchewan.
Bil'l No. 54, an Act respecting the construction of a Canadian National Railway line from or near Rad-ville, Bengough or Ritchie, in the province of Saskatchewan.

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Petitions were presented from certain members of the following congregations, severally praying that the proposed legislation incorporating the United Church of Canada, be not
enacted:
E. H. Tew and others, of Assiniboia-Mr. Hopkins.
St. John's Presbyterian Church, Vancouver, B.C.; St. Andrew's Presbyterian Church, Vancouver, B.C.,- Mr. Stevens.
William Carruther and others, members or adherents of the Presbyterian Church,-Mr. Warner.
Petitions were presented from certain members of the following congregations and bodies praying that the bill now before the House to incorporate the United Church of Canada be passed during the present session.
Presbyterian Church at Govan, Sask.,-Mr. Motherwell.
Methodist Church at Boharm, Woodslee and Ruscomb; P.E.I.; Presbyterian Church at Wardsville, Ontario; Wesley Methodist Church, Fort William; Presbyterian Church at Khedive, Sask.; Methodist Church, Sydenham, Ont.; Methodist Church at Charlottetown, P.E.I.; United Church of Holmfield, Man.,-Mr. Reid.
Brown's Corners, Central and St. John's Presbyterian Congregations at Unionville, Ontario; Methodist Church at Fonthill, Ontario; Methodist Church at Plattsville, Ontario; Union Church, Oak River, Manitoba; Presbyterian Church at Elmwood, Ontario; Fenwick, Forks Road East and Mount Vernon Methodist Churches; Methodist Church at Thamesville, Ontario; Presbyterian Church, Carman, Man.; Methodist Churches at La Havre, Mount Pleasant and Dublin, Nova Scotia; United Church, Snowflake, Manitoba; Presbyterian Church, St. Lukes Congregation, Cape Breton; Grace Methodist Church at Fort William, Ont; Presbyterian Church at Kinmount, Ontario; Methodist Church at Elmvale and Allenwood, Ont.; Presbyterian Church, Maple Creek, Sask.; Methodist Churches at Northwood, Botany and Beechwood, Ontario >
Union Church at Decker, Isabella and Orrworld, Man.; Methodist Church, Tweed, Ont.; United Church at Toulon, Sask.; Methodist Church at Petrolia, Ont.,- Mr. Pritchard.
Methodist Church at Heborn and Port Maitland; Rae Street Methodist Church, Regina, Sask.; St. Andrews United Church, West Summerland, B.C.; St. Pauls Methodist, Church, Calgary, Alta.; St. Andrews United Church, Montague, P.E.I.; Methodist Church at Chumah and Hamiota; Presbyterian Church, Valleyfield, P.E.I.; Union Church, Ponoka, Alberta; Methodist Church, Clifton; United Church at Thessalon, Ont.; St. Pauls Methodist Church, Ottawa, Ontario; Presbyterian Church, Watson, Sask.; Trinity Methodist Church, Toronto, Methodist Church at Exeter, Ont.; Zion Methodist Church at Moose Jaw, Sask.; United Churches at North Antler and Pierson, Man.,-Mr. Sexsmith.
Union Churches at Avonlea and Hearne, Sask.; Methodist Church at Carleton Place, Ontario; Presbyterian Union Church, Edam; Presbyterian Ukrainian, Fort William, Ont.: Wesley Methodist Church, Ottawa East, Ottawa, Ontario; Methodist Church at Haleys Harton, Ontario; Methodist Church, Rose-mount, Montreal; Methodist Church, Wroxe-ter, Ont.; Union Churches at Hargrave. Harmsworth and Victor, Man.; St. Andrews Presbyterian Church at Sunderland and St. Johns Presbyterian Church at Creswell, Ont.; Methodist Church at Riceville, Ont.; United Methodist and Presbyterian Church at Ballersea and Sunbury, Ontario,-Mr. Woods.
Methodist Church at Yarmouth, N.S.: United Church at Elkhom, Manitoba; Methodist Church at Canning, N.S.; Presbyterian Churches at Grand Coulee and Sherwood, Sask.; Methodist Church at Plainfield, Ontario; Presbyterian Church, Pilot Mound. Man.: Methodist Church at Lethbridge, Alta.; Union Church Markinch, Sask.; Methodist Church Kildonan, Man.; Presbyterian Church, Clanwilliam, Man.; St. Pauls Methodist Church, Montreal, Que.; Union Church. Beaver, Man.; Union Church, Selton, Sask.; Methodist Church at Teeswater, Ontario; United Church, North Portal, Sask.; Methodist Church at Wheatley, Ont.; Presbyterian Church at Hanay and Hammond and Pitt-meadow's, B.C.,-Mr. Rankin.
Carmichael Presbyterian Church, Regina, Sask.; Methodist Church at Fullarton. Ontario; Westminster Presbyterian Church. Regina, Sask.; Methodist Church at North Earls-
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Questions
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court, Ontario; Rhodes avenue Presbyterian Church, Toronto; Presbyterian Church, Ar-gyle and Stonewall; Methodist Church at Wilfrid, Ontario; Strathroy Methodist Church at Stiathroy, Ontario; Mrs. W. C. Smith and 124 others, Oak Lake, Manitoba,-Mr. Drummond.
Presbyterian Church, Gabarus, C.B.; Union Church, Rose Plain, Sask.; Lucky Lake Congregation, Lucky Lake, Sask.; Methodist Church, Stratford District, Ontario; Methodist Church, Phippen, Sask.; Union Church at Treherne, Manitoba; Methodist Church. Munson, Alberta; First Presbyterian Church, Wilton, Grove, Ontario; Union Church at Heron, Sask.; Methodist Church at Magogue. Que.; Methodist Church at Monkton., Ontario; St. Andrew's Presbyterian Church, Glamworth, East Middlesex; Methodist Churches at Prestonvale, Boyds and Playfair, Ontario; Union Congregation of the Union Church at Port Sydney and Utterson; Tal-botville circuit Methodist Church of Talbot-ville, Ontario; Toronto District Association of Congregational Churches; Shaw Memorial Methodist Church at Montreal, Quebec,- Mr. Hodgins.

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(Questions answered orally are indicated by an asterisk.)

Sir HENRY DRAYTON:: What were the operating ratios of the Atlantic, Central and Western regions of the Canadian National system for the year 1923?


Hon. Mr. GRAHAM:: Atlantic Region	123.23
Central Region	 85.38
Western Region	102.80


QUESTION PASSED AS ORDER FOR RETURN
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government purchases of automobiles Mr. McBRIDE:
1.	How many passenger automobiles have been purchased by the government in each of the years-1919 1920, 1921, 1922, 1923 and 1924?
2.	What has been the cost of upkeep of such cars in each year?
BEAUCHAMP'S SENTENCE-THE LASH On the Orders of the Day:
Right Hon. ARTHUR MEIGHEN (Leader of the Opposition):: It is two weeks to-day since the Minister of Justice (Mr. Lapointe) made a statement to the House with reference

to the Beauchamp case. On that occasion I asked him whether he would lay on the Table the actual order issued from the Department of Justice in the case and his answer was, "With pleasure". He has not given himself that pleasure yet. I do not know why two weeks should be required to lay on the Table one paper from the Department of Justice.
Hon. GEORGE P. GRAHAM (Minister of Railways): The Minister of Justice is giving himself the pleasure of attending a wedding to-day, but I will call his attention to the remarks of my right hon. friend.


Arthur Meighen: Will my hon. friend
break in on the wedding to advise his colleague that I should like laid on the Table, as well, the general order in respect of prisoners to be lashed, referred to by the minister in his own statement? I have reference to the general order covering all cases and which, according to the minister, rendered the issuance of the order in this case, superfluous.


THE BUDGET
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CONTINUATION of debate on the annual
financial statement of the acting

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The House resumed from Wednesday, May 7, the debate on the motion of Hon. J. A. Robb (Acting Minister of Finance) that Mr. Speaker do now leave the chair for the House to go into committee of Ways and Means -and the -proposed- amendment thereto of Mr. Woodsworth.
Mr. W. J. LOVIE (Macdonald) :: I wish to congratulate the Acting Minister of Finance upon the able, businesslike and statesmanlike manner in which he has introduced this his first budget in the House of Commons of Canada. It was not a lengthy address; but it was clear, concise and to the point, and left no doubt in the minds of all who heard it that a serious, determined effort had been made to fulfil the promises made in the Speech from the Throne.
The Speech from the Throne hinted at a balanced budget, and we find in the budget that there was a surplus of revenue over expenditure for the past year of $67,750,000 with a $30,000,000 reduction in the national debt, and a promised reduction in taxation of $24,000,000. Also we find that the customs tariff on agricultural implements has been reduced, and the sales tax done away with on these articles. The sales tax on boots and shoes has been reduced by half, and the general sales tax has been lowered from 6 per cent to 5 per cent, which, although it is not much of a reduction, will assist in a small

The Budget-Mr. Lovie
measure to reduce the cost of living for the workingmen all over Canada, who for the past few years have found it very 'hard to make ends meet and carry on.
For the past number of years Canada has had the unenviable reputation of being the most expensive country on the face of the globe to live in, and an appreciation of that fact by those in authority, and a determined effort to do something* to change these conditions, will go a long way towards restoring confidence in Canada by those who are seriously asking themselves the question:	Is
it worth while to carry on any longer in the face of conditions such as prevail at present, and have prevailed for the past few years? _ What are the conditions that prevail in Canada at the present time? Hon. members who have preceded me in this debate have each and every one described conditions such as actually exist in his own particular part of the country, and have made an honest attempt to find a cure for these unfavourable conditions, therefore, I will endeavour, with the permission of this House, to describe the position of agriculture in the province of Manitoba, the province that includes within its boundaries the city of Winnipeg, the gateway to the great West, and often named the Chicago of Canada, and which is destined in the future to outrival even that great American city. The city of Winnipeg is a large distributing and railroad centre. All the wheat raised in Manitoba and Saskatchewan, and until quite recently, Alberta, passes through Winnipeg, and is graded there en route to the head of the lakes. Large stock yards are located at St. Boniface for the handling of the live stock for the three prairie provinces, and large wholesale warehouses for the distribution of agricultural machinery and implements. There are also available all the necessaries of life to make Winnipeg a large distributing centre; but it is not a manufac-[DOT] turing city-at least not yet. These stock yards are a credit to the Department of Agriculture as well as to the United Grain Growers in Winnipeg, to the extent to which these institutions have contributed to the success that has been attained. And these are co-operating splendidly in order to retain the farmers of Manitoba in the business of fattening cattle in winter. The Department of Agriculture is paying fares of farmers to Winnipeg and paying half freight on all cattle taken from the stock yards for winter feeding. The United Grain Growers are doing an admirable work in the collecting and grading of cattle in carload lots for shipment, and these carload lots are made available to the farmers.
The province of Manitoba is largely agricultural; wheat is its main product, but in conjunction with wheat the farmers raise oats, barley, rye, flax, potatoes, vegetables, horses, cattle,' sheep and swine, and have for sale butter, cream, poultry, eggs, and so forth. The soil is really choice, being in most cases a deep black loam on a clay sub-soil, and the climate is admirable.
What is the financial situation of farmers in the province of Manitoba to-day? If the House will bear with me I will describe conditions in the exact words of one who described them to me, and who is experiencing these conditions. The language is not parliamentary, but is is expressive. Here it is: "We are getting enough to eat, but we are most viciously short of money." In the municipality in which my farm is situated the secretary-treasurer informed me during the Easter recess that on January 1, 1924, only 50 per cent of taxes were paid, and no mention is made of taxes that were paid by money borrowed from banks, loan companies, and so on as that cannot be ascertained. The crop of 1923, whichi promised a heavy yield, rusted badly, and was a financial loss, as the expense of harvesting and threshing was very great. The crop of 1922 did not pay more than 50 per cent of the cost of production, although it was a fair crop of splendid quality. The cost, of production in Manitoba is so high that agriculture since 1920 simply cannot be carried on profitably.
To get a foundation upon which to study this question, everyone should seriously put before himself this problem: Is a farm in Manitoba to-day an asset or a liability ? Frankly, in answering this question I would say, both from experience and observation, that a Manitoba farm is a liability. When we admit the fact that a Manitoba farm is a liability is it not a good premise from which to start to find a remedy for such conditions?
Now, the two main sources of revenue for Manitoba farmers are wheat and fat cattle. Wheat there is always a market for-at a price; but with cattle it is different, the demand being seasonal, but it is generally conceded that the spring market is the best market in Manitoba for beef cattle. Of course, there are other sources of revenue, such as sales of horses, swine, butter, eggs, poultry, and so forth, but these are only incidentals, wheat and cattle being by far the main money crops and wheat the principal one.


Mr. SPEAKER:: Order. There is too much conversation going on in the chamber. I think in justice to the hon. gentleman who is
The Budget-Mr. Lovie

addressing the House hon. members might keep silence.


Some hon. MEMBERS:: Hear, hear.


William James Lovie: Western Canada raises a large surplus of wheat which has to find an outlet on the open markets of the world in competition with wheat from all the great wheat producing countries. Her farmers are thus compelled, by circumstances over which they have no control, to take for their wheat, their main money crop, what it is worth on the open markets of the world, less storage and transportation charges. Their surplus cattle find an outlet in Great Britain, but again this is the proposition of a free trade market, and after long rail transportation charges are paid to the seaboard, and ocean carrying charges, about all that is left to the farmer is the pleasure that he can take out of the steers' company.
What are the main features that go to make a Manitoba farm a liability? High taxes, high cost of necessaries of life, including clothing, boots and shoes, high cost of agricultural implements, high freight rates, high express rates, and high interest charges on borrowed money. All these combined compose a dose of foes and woes, which are sapping the very heart blood, and demolishing the morale of every farmer in Manitoba.
To those who are giving the matter serious consideration, the most pressing problem in Manitoba to-day is: How to make Agriculture profitable? It is a recognized fact that if agriculture is profitable, every line of business will be profitable also, but if agriculture languishes all industries in turn suffer. Here I will quote from an editorial in the Free Press of recent date. It says:
Farming is the real business of western Canada. Western Canada, country, town and city lives on what is taken out of the soil. The more wealth produced out of the soil the better off the country will be. If the farmer is going to be put out of business by conditions that make it impossible for him to get even a small profit on what he produces, then the whole country is in for a bad time. Enabling the western Canadian farmer to make a profit on his grain and on his live stock should be the job of every citizen in this western country. To-day Europe is the main market for the farm products of western Canada, and the genius of the country should be devoted to making it possible for our grain and our live stock to be sold across the ocean in competition with the world and at a profit to the western farmer.
It is a truism that if the western farmer is making money a condition is created wherein the general business of the country is put on a firm foundation and is able to look after itself.
What has been the position of agriculture in the past and why was there no whisper of such conditions previous to the last few years? The answer is this. From the year 1907 to 1913 there was on an average 74 mil-

lion dollars per year being circulated in Canada for railroad building, as the Grand Trunk Pacific and the Canadian Northern were then under construction. The money expended on the building of these railways going into circulation kept the wheels of industry in Canada turning in good style and everything was prosperous. But about the middle of the year 1913 this expansion came to an end. Hard conditions and ' unemployment would have struck Canada then, only for the fact that the war intervened and enlistment for overseas service gave employment to thousands who otherwise would have been idle. Added to this was the phenomenal crop of 1915, and the money obtained for the manufacture of munitions, which, combined, brought a lot of wealth into Canada.
When the world war started in 1914, and for years previous, prices between farm products and other commodities had been fairly established and presumably in accord with economic law extending over a series of years. Then during the years of the war prices of all farm products jumped to unprecedented heights. Those conditions we need not discuss, except to say that it is astonishing how little our farmers have to show after this great outburst of seeming prosperity. High prices, aided and abetted by a cry from those in authority, to "produce, produce, produce, if we wish to win the war," led to expansion, extravagance, and real estate speculation, and during that time labour climbed the ladder very rapidly. If now we compare the present ratio between the prices of the things the farmers have to sell, and what they must purchase, we find that the balance has been rudely disturbed, and until that relationship has been restored we cannot look for a genuine and permanent prosperity. Looking at the question from the view point of permanent national well-being, we may well shudder when we contemplate the consequences in the coming years unless this disparity between agriculture and industry is removed, and there is no doubt but one of the great problems confronting us to-day is how to restore a proper and healthful relationship between our industries and our agriculture.
Now, how are you going to make agriculture profitable? The hon. member for Fort William and Rainy River (Mr. Manion), and every Conservative member who has spoken, suggests one method, and the Acting Minister of Finance in delivering the budget suggested another. I am going to give the Conservative plan and I will take it first-hand from an editorial in the Manitoba Free Press, which puts it in shorter and much better form than I possibly could. Here it is:

The Budget-Mr. Lovie
Make it possible for capital to embark upon large manufacturing enterprises; these will give employment to large numbers of men; this will build up towns and induce prosperity; there will thus be opened up markets for the products of our natural industries; everything will then be lovely and flourishing, and pulling ever more vigorously upon our own bootstraps, we shall rise higher and higher into the warm sunshine of prosperity.
The Acting Minister of Finance (Mr. Robb) in his budget has suggested another remedy.
He says:
Of these basic industries I would place agriculture in all its various branches first. Next to agriculture I would put our forests, our minerals and our fisheries. A real national policy is a policy that will encourage the growth and development of these basic industries.
That is the soundest bit of fiscal wisdom that has been heard from a Canadian Minister 'of Finance for many a long year. An economic policy in keeping with these views is what Canada requires, and it is highly encouraging to note that the modifications and changes proposed by the hon. gentleman (Mr. Robb) are all in keeping with such a policy.
Now, the Conservative policy in a very few words might be summed up in the amendment, which was really the logical amendment to a low tariff budget, introduced by the hon. member for Kent, NJ3., (Mr. Doucet) in these words:
That the welfare of Canada requires a consistently maintained protective policy.
That sounds good. Who and what is going to be protected? Canada depends upon her natural resources for revenue, and of the four basic sources of wealth, namely, the ocean, the mine, the forest and, the farm, the farm easily holds first place, the value of agricultural products exported being greater than the value of the products. of the other three sources of wealth. Is it too much to ask that the attitude of the government in a country where agriculture holds first place should be to encourage and develop the basic industry of that country? Remove all handicaps that stand in its way and see that its produce has access to the best markets of the world at the lowest cost, at all times. Would a protective policy do that? Would it encourage and develop agriculture?
What is claimed by the exponents of a protective policy is that the tariff will shut out importations and enable industry to charge a big price to the people in the country. By getting a big price for their output owners of factories will be enabled to pay big wages to their employees, who in turn will be quite willing to pay an enhanced price for the products the farmer has to sell.
But do these employees of factories pay the farmer an enhanced price for his surplus products? Not much! There is at present a great disparity in quantity between what the farmer raises and what the city man consumes; so an export market must be found; and the exportable surplus-be it small or large-regulates the price the farmer receives for his goods on the home market. Consequently, a protective tariff gives him no advantage in selling, and works to his disadvantage in buying. WTere the population of a country evenly balanced between agriculture and industry, and that country entirely self-sustaining, a protective tariff would do no preceptible harm; it would simply be a merry-go-round which would hurt no one as long as no export trade was done.
Protection blooms and flourishes when the people of one section get an advantage by legislation over the people of another section of the same country, and this goes by the name of special privilege, but the real name is legalized robbery.
Will the protective policy advocated secure a home market for the farmer? Well, it might in a hundred years, but what agriculture needs is relief from the present unhealthy conditions; not a hundred years hence or next year, but now, at once, or else the farmers will be all in the poor house. Prompt action is imperative if Manitoba agriculture is to be salvaged. An increased dose of that protective tariff which has been largely responsible for the difficulties of Manitoba farmers in the past would mean sudden financial death to the majority of them, and agriculture in that fair province w'ould become a thing of the past.
Would the protective policy that is advocated assist marketing conditions for the Manitoba farmer? No! It could not do so because, first and foremost, the protective tariff would cut off importation and would stand in the way of the selling of our products. No nation can trade with another nation unless the trade is profitable to both. No nation can sell to another nation unless each is prepared to take goods in exchange for goods exported. One nation exports its surplus, which the other nation needs, and takes in exchange the surplus goods of the country it sells to. International trade is not carried on by the use of money, but goods pay for goods and imports exceed exports if the trade is profitable. The reason for that is that the value of the exported article purchases goods on the foreign market which after being taken to Canada are of more value than the ex-
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The Budget-Mr. Lovie

ported article; thus it is in the interest of a country to stimulate and encourage trade rather than hinder it. Besides, with assured traffic two ways, transportation charges would be far lower than would obtain with traffic on a one way basis, and the trade would' be profitable to both nations engaged.
When a nation having a protective tariff wants to carry on trade, their method is- send an ambassador to the country to which they wish to sell their surplus to arrange for trade, and then raise a tariff wall against the surplus products of that nation, either to prevent those products from getting into the country, or else to make them so expensive that it is unprofitable to purchase them. It has been abundantly proved that the protective policy which is advocated cannot protect agriculture in Manitoba nor make it profitable. Those who will benefit by a high protective tariff are engaged in industry, and those who are going to suffer by this protective tariff are engaged in -agriculture. No one engaged in agriculture is asking for protection; they know such a thing is impossible unless it take the form of a bounty, and they realize that that is impracticable as well as dangerous. But what they do ask for and demand in no uncertain terms is that the handicaps imposed upon agriculture by a protective tariff be removed, so that they may have a fair share of the good things of life which those engaged in industry enjoyl Should the tariff be raised, good-bye to the free, independent, courageous spirit which carried the young Canadian manhood so gallantly through the world war; the Manitoba farmer will be so crushed between the upper millstone of high protective tariff, and the lower millstone of high transportation charges that he will be reduced to the position of a slave or a Russian peasant, not the sturdy, clear-thinking yeoman we all wish the Canadian farmer to be.
If the protective tariff was raised, would anyone in Manitoba be benefited. Most emphatically I say, no. Manufacturers and dealers think they would be benefited; that they could succeed in extracting a little higher price for their output than they can get at present. But let me tell the manufacturer and the dealer in all articles which the agriculturist purchases that the farmer's purchasing power is down to a very low ebb, and a little more will put him out of business altogether. The matter with agriculture to-day is that the price of things the farmer buys is altogether too high in comparison to the price he receives for what he sells, and
I Mr. Lovie.]
to pass legislation to make these necessaries of life and production higher in price would mean swift and sudden death to the farmer's business.
What is needed to make agriculture profitable in Manitoba is for the farmer to be able to purchase the necessaries of life and implements of production on the ratio of the price he receives for his produce-in other words, at a price set by the competition of the open markets of the world. The farmer knows that only under such conditions will agriculture, the basic industry of Canada, receive a square deal, and he is looking forward to a time when such conditions will obtain. He sees no reason why industry, which is catering to his requirements and which without him could never hope to keep alive, should be bolstered up by a protective tariff and given privileges for which he ha's to pay. The Manitoba farmer cannot understand why agriculture, which is the primary industry of the country, should be made to pay tribute to a secondary industry, neither can he understand the howl that comes from the owners of these industries that they must have increased tariff protection or else go out of business. The farmer argues -this way: That the ability of any industry to establish and sustain itself in a free field is the measure of its public utility, and industries which cannot support themselves are not wanted or needed, the proper maxim being "A fair field and no favour." A protective tariff was introduced into Canada to protect infant industries, but though a great many years have elapsed since then, these industries still continue infants in their desire for protection, and the length of time they -would continue to cry out for protection can only be measured by eternity, Experience has shown only too plainly that these interests figure that the fleecing of their fellow-citizens is a God-given right which no one has any liberty even to hint at taking away from them.
Let us now turn to the budget itself. The official opposition claims that the government has no mandate from the people to entitle them to lower tariff duties and that, therefore, before they do so they should appeal to the people; in other words, that there should be a general election. Let us analyse this demand. We all know that the Liberal party went to the country upon a platform of lower tariff; therefore it is obvious that their election on that platform gives them a mandate to make the duties lower. As the Manitoba Free Press says, it is hard to realize why a party elected upon such a platform should be censured and challenged for

The Budget-Mr. Lovie
reducing the tariff the little bit that has been done.
An attempt has been made by the Acting Finance Minister, in the budget he has just brought down, to grapple with the desperate situation which confronts farmers in the prairie provinces, but it is only an attempt and will not do very much towards relieving the situation. One thing it will do, and has already done, is to put the tariff squarely before the people of Canada as an issue, and personally I have no doubt the next election will be fought upon the tariff issue.
The one unfortunate thing about general elections is the fact that the real issue at stake is intentionally beclouded and sidetracked. Between flag-waving and the cry of loyalty and patriotism, the attention of the electors is drawn away from the real issue at stake; they are bamboozled and confused. The real issue in the next election will be high or low tariff, and it is up to every elector to make every prospective candidate declare himself squarely on that definite issue.
Now, what is wanted is a method of making agriculture profitable. The farmers of the three prairie provinces are doing their level best to have a wheat pool operating in each province to handle the 1924 and subsequent crops. The idea is to have an interprovincial pool in four years' time, and later an international pool to handle the wheat of the continent. They know they cannot raise the price of wheat on the world's markets, but they expect by the application of business methods and the prevention of dumping of wheat on the world's markets in a few months, to steady and regulate the price. The price of bread will not be raised to the consumer, as bread has been on the basis of 81.50 wheat for some time, but the pool will endeavour to see that the same intelligence and the same knowledge of world conditions are applied to the marketing of -tfheat for the benefit of the producer as are available to men engaged in marketing our manufactured products. The wheat pool is a big thing, the biggest yet undertaken in our western country, and something which may yet revolutionize marketing conditions for wheat.
I That there can be money saved on marketing wheat, no one will deny. Last fall feed wheat sold at from 35 to 40 and 45 cents per bushel, sixty pounds, and it had to be all wheat, otherwise it would be docked. Wheat j worth 40 cents per bushel by the load would be worth about 45 cents by the carload. At 35 cents the price would run to about $11.60 j per ton, at 40 cents to about $13,25, and at 45 j cents to nearly $15. At the same time that feed wheat is being bought on the open market at that price, recleaned screenings at
Fort William are quoted at $23 per ton. Recleaned screenings consist of small wheat, cracked wheat, buckwheat, and wild oats with the black seeds screened out. On that price of $23 a ton, freight has to be paid. Bran is quoted by the milling companies at $23 a ton, and shorts at $25. Not so much money can be saved on the high grades, but a lot of low-grade wheat is included in the output every year, which no one . can help, and which goes to the dealers practically at their own price. _
Now I wish to say a few words on the question of transportation. The long freight haul operates against the Manitoba farmer but that can be easily overcome as the Hudson Bay railway, which we expect to have built and completed at an early date, will cut off a thousand miles of haul by rail and bring the prairie provinces close to seaboard. When the question comes before the House, more will be heard about the Hudson Bay railway.
Then there is also the fact that the Crows-nest pass agreement will come into effect on the 6th of July next, which will give relief to both East and West in the matter of freight rates, if the government just sits back and lets the agreement come into effect.
Express rates are also very high. During the Easter recess while I was West there was a meeting of farmers to be held in the town of Carman to discuss the express rate situation. but unfortunately on account of a snowstorm the meeting did not materialize. I was however, given specific instructions to bring before the House this question of express rates and to see if something could not be done to reduce them and bring them more in line with the price the farmer and his wife are receiving for the products they have to sell.
Then, with regard to export rates on cattle, which have been proved1 time and again to be too high, I wish to quote from a speech delivered by S,ir Clifford Sifton before the Canadian Club last January. He said:
Then take the question of cattle. Our government got the embargo taken off cattle. The rate on cattle from Montreal to Liverpool was $15. The ocean steamship companies put it up to $25 a head. And let me tell you, gentlemen, the Canadian Merchant Marine, the organization built with our money, at a cost of $70,000,000-instead of helping the Canadian farmer in this matter, they were in the job against the farmer, right up to their necks!
There is nothing easier than to adjust this matter. The harbours of the world are filled with ships that have nothing to do-they can be hired, rented, chartered, without the slightest trouble. In twenty minutes the government of Canada could ensure a $10 rate from Montreal to Liverpool if they chose. Any well-informed person knows that $10 is a good profitable rate for carrying cattle from Montreal to British ports.
The Budget-Mr. Lovie

Colonel Mullins who is a very large feeder of cattle has this to say, with reference to the treatment he received in shipping a load of cattle across on the Victor, of the Government Merchant Marine:
The capacity of the Victor is 230 spaces, those in authority say, and you must put 270 head on and pay at the rate of $25 per head. I put 247 head on and paid for 270, making the ocean freight cost $27.33 per head. This is an injustice and goes a long way to discourage the producing of cattle.
The Manitoba Free Press, commenting on this, says:
The Canadian government's boat charged him $25 t head on the basis of 270 cattle for the boat, though the capacity of the boat at the standard rate of twp-and-a-half feet per animal is 230 head.
Although only 247 cattle were put on the boat the Canadian Government Merchant Marine charged on the basis of 270, making the actual charge $27.33 per head.
When Col. Mullins made a protest to the Dominion Minister of Agriculture he got, in reply, a telegram stating that as he had' shipped to Dundee in expectation of a better market the higher rate charged him was " warranted."
It is an acknowledged fact that rail transportation costs seven times as much as water transportation. We find that the rate from Winnipeg to Montreal by rail is from $10 to $11 per steer, while the ocean rate from Montreal to Glasgow is $20 or over, and as the distance is twice as great, the rates are practically the same. The ratio between land and water rates is generally seven to one.
Now I wish to say a word about income tax. I am not going to kick about the income tax, because I believe in it. In this debate we have heard a good deal both for and against the income tax as a means of raising revenue, and I am not going to enter into the controversy for or against, except to say that I believe the income tax has come to stay; but what bothers the farmers is the filling up of the income tax returns, as their system of bookkeeping does not lend itself to accuracy in detail. I have been asked to 'suggest to the Acting Minister of Finance (Mr. Robb) the advisability of appointing some official in each municipality, probably the municipal clerk if it was thought advisable, to assist the farmers in making out their income tax return. As all hon.
4 p.m. members know, any member of parliament can call in the assistance of a gentleman, Mr. Gray, who is an expert, in filling up their returns, and he certainly does the-job in a very short time, and there is no trouble afterwards. It does seem to me a hardship that farmers should be put to all this trouble, and they are asking that someone be appointed to assist them in filling out their returns who would guarantee that

there would be no trouble afterwards. The filling up of the returns bothers the farmer considerably, but snappy letters asking fur further information six months after the returns have been made antagonize them, as these letters have a tendency, and are intended, by all appearances, to make farmers feel they are criminals instead of what they in the main are, decent, law-abiding citizens. A change would certainly be welcomed in the line of assistance to farmers in filling up in-' come tax returns.
Now a word as to mixed farming. Farmers are very often urged in this House to go in for mixed farming if their farming operations are not profitable, but no specifications are given as to the particular branch of mixed farming they should go into. I see by the Manitoba Free Press of 3rd December last, that the Solicitor General (Mr. McMurray) speaking before the Reform Club in Montreal, said:
Mixed farming is urgently needed in Manitoba. It is the only remedy in Manitoba for the problems confronting the farmer.
Mixed farming has been held up as a panacea for all the ills the farmers are suffering from. Well, Mr. Speaker, advice is cheap to give and those who know their subject the least are often the readiest to give advice. I should like to tell the House something that was told me by a gentleman actively engaged in mixed farming. He is a neighbour of mine and he and I were in Winnipeg buying steers for feeding. He said that the superintendent of the experimental farm at Brandon last summer sent out a request to all the farmers in the vicinity that any who felt they were not getting returns from their farms should write him a letter, and he would tell them how to put their farms on a paying basis. This friend of mind wrote to the superintendent, and the answer he received was this:
I do not know what to advise you to jnake your farm pay. You are doing everything now I could advise you to do.
This gentleman raises wheat, oats and barley, also pure-bred Clydesdale horses and purebred shorthorn cattle; he milks from twelve to fifteen cows, feeds a carload of steers every winter, raises Yorkshire hogs, and raises also all kinds of poultry; and yet he cannot make farming pay, and the superintendent of the Brandon experimental farm says, "I do not know what to advise you to make your farm pay."


Mr. GARLAND (Bow River):: Ask the
Solicitor General (Mr. McMurray).


William James Lovie: Yes. There is another thing I want to touch on, it was drawn to my atten-

The Budget-Mr. Boucher
tion in a letter not very long ago. In Manitoba this year conditions are very much the same as last, because the spring is late and wet, and we are very much afraid of rust. This writer says:
I am afraid the spring will be so late the rust will get us again. The rust is supposed to winter over on the barberry bushes. The United States seems to be cutting them down and destroying them as fast as they can, and I have often wondered if Canada had any barberry growing wild, and whether they were doing anything to get rid of them. It might be a good idea to ask a few questions on the subject. The Canadian government should take steps to find out if there are any barberry bushes. I believe there are some in the Riding mountains, and if there are they should be destroyed as quick as possible. It would be a whole lot better for Canada than these far north survey parties who get free cigars and cigarettes because it is a hard country to work in. Give them work of more consequence nearer home and let them buy their own luxuries. I want you to look into the barberry bush and rust business and if nothing is being done, make them get to work pronto. Just think of all the work I did on that 200 acres of summerfallow, and if it gets rusted the whole thing is a ruination business, as far as I am concerned.
I would like to bring to the attention of the Minister of Agriculture (Mr. Motherwell), if it is in his department, or to the attention of the Minister of the Interior (Mr. Stewart), the matter of these barberry bushes, in order to see that they are destroyed, or else I will get into trouble with the writer of this letter.
Cheaper money is needed for the farmers. Farmers are borrowing money at high rates of interest. They cannot afford to pay the rates of interest they have paid in the past. The following is part of an editorial which appeared in the Free Press:
Something worth while has been gained by the now general acceptance of the view that our commercial banks are not equipped to supply short term credits. Dr. Tory says this explicitlj'. The banks, until very recently, stoutly disputed this contention, declaring that the farmers who were entitled to credit could get it from them and pointing to their very substantial losses as proof that perhaps an excess of credits had been granted. No one will deny that the aggregate of loans given to farmers throughout the West within, say, the last ten years by the banks runs into large figures and that the losses have been great; but the lesson from this is that our banks are not equipped to attend to this business of giving rural credit and make a bad job of it, both from the point of view of their own interests and with respect to the interests of the farmers. Commercial bankers are not, in most cases, competent to determine the extent and character of credit that should be given for farm operations. Also countless farmers have been ruined by being given credit and having it called in the middle of the farming operations which were intended to produce the money to pay the debt, under peremptory arbitrary orders sent out broadcast from a head office in Montreal or Toronto. No system of banking based upon a ninety-day turnover with renewals dependent upon conditions over which the borrower has no measure of control, is fitted to supply short term credits for farm purposes. These credits need to run from nine months for
ordinary farm operations to three years for the growing of live stock. Commercial banks cannot be relied upon to give these credits; and they should be retired from the job and the task of financing agriculture given to other agencies.
Nearly everyone who knows anything about financing farming realizes that a three months' loan is not of any use, and if the credit given to the farmer is going to be cut off at a critical period, he is going to be put out of business altogether.
In conclusion, I may say that this budget does not go far enough on the road I would like to see Canada travel, but I have consulted with some of my constituents and they are of the same opinion as I am, that it is moving in the right direction, and is only a forerunner of better things to come in the not very far distant future. Therefore I will have much pleasure in voting for the budget.


Mr. AIME BOUCHER (Yamaska) (Translation) :: Mr. Speaker, ever since my entering this House, I have anxiously been awaiting the budget which is, at present, under consideration. I am, therefore, pleased to congratulate the hon. Acting Minister of Finance (Mr. Robb) for having prepared and delivered such a budget, confident, as I am, that it conforms to the true Liberal principles as I have understood them heretofore and that it will be beneficial to the whole community.
I am astonished, Sir, to hear members who occupy seats on your right, in small number it is true, but whose talents and sincerity cannot be questioned, contending that the budget does not conform to the programme traced by the great leader who, during twenty five years, presided with so much glory and dignity over the destinies of the Liberal party. I am astonished, for if the contention of these hon. members is well founded, I am forced to confess that I have not understood anything of the political history of this country, and that I have preached, during the two electoral campaigns which I made, a gospel which does not conform to the teachings of my leaders. However, I know that I have -not been a heretic and this I can prove very conclusively by Sir Wilfrid Laurier's public statement to the Canadian people, in 1917:
Should the people entrust me with the administration of the country, I would make it a point to immediately unburden the farmer of all vexatious custom duties. .	.	.
I would immediately abolish the duties on farm implements and other necessities with reference to farming as requested by the western people. And, I would consider as an essential duty of my administration a general and thorough revision of the tariff aiming at encouraging production in Canada and relieving the Canadian consumer.



The Budget-Mr. Boucher
Is there any need of further proof? The extract which I have just quoted is a distinct, certain and absolute pledge, and, this pledge does not stand alone; all Sir Wilfrid Laurier's speeches contain similar ones; the whole of his life, his policy has had for its aim the lowering of duties in order to help the consumer, and it is thus the people understand it. It is especially in that spirit that his opponents understood it, when in 1896, playing the part of birds of ill omen, they spread all over, proclaiming to the people that the return of the Liberal party to power would mean the ruin of our industries and the closing of the doors of our factories.
False prophecies! Wrong conjectures! On June 23, 1896, the Liberal party assumed power, in spite of these inauspicious prophecies, and, what happened? The factory did not close its doors, bankruptcy did not appear on the threshold of ruined industry; on the contrary, the wheels of industry moved more rapidly and powerfully, the chimneys belched out greater volumes of smoke and the country experienced an era of prosperity, sucli as it had never enjoyed previously, and which all agree to look back to as ''the golden age of Canada."
What was, Sir, the reciprocity pact as to natural products put before the Canadian people, in 1911, if not a measure destined to favour the consumer, and especially to open up for the farmer, a market having behind it a population of 100,000,000, without gainsay, the most advantageous in the world, which, at present, is unfortunately closed to our farmer by the high tariff wall which the United States have erected? What' opposition did this project so advantageous to the farmer and consumer, meet in the country, this project that had been the cherished aim of Canadian statesmen for a great number of years, and which the neighbouring republic had finally accepted? By whom and by what means was it fought by the same gentlemen who, to-day, oppose the Liberal party; by launching a wild campaign where cries of treachery :and disloyalty filled the air by flaunting in our faces the phantom of annexation-Tory tactics, always using the same means. It is thus that Canada was deprived of one (of the most precious advantages from an economic Standpoint, and for which it may have to wait again many long years for its return.
In the course of the last two sessions, Sir, I have heard the members of the Opposition together with their leader, state and proclaim that the government has no policy, that it lacks sincerity and that it does not put into practice the principles expounded in its pro-

gramme. And when the opportunity presents itself for the government to bring down in the House a budget, which although it is not the realization of the whole of its policy, yet is an important plank in its programme, we witness a repetition of what took place in 1896. There are still birds of ill omen which cry out the ruin of our industries, the closing of our factory doors, but not one of them has the courage to rise in this House to tell us: At least we admire you for keeping your word and we give you credit for your actions.
The seat which I occupy in this House, was not won by misrepresentations. During the two elections which I went through, one of which made quite a stir throughout the country, I came forward as a straight Liberal and I can state that the present budget is absolutely in keeping with the policy which I proclaimed and that I pledged myself to carry out. I consider that in public life as well as in private life, the first duty of an honourable man is to keep his word, and I am glad that the government offers me, to-day, the opportunity of fulfilling the pledge which I took towards the electors of my county, by voting for a budget framed with the ideals set forth in the one at present submitted to us.
From the outset of the debate on the budget, Sir, I have listened with much' interest, either from one side or the other, to the expounding of two old principles which have used up much ink and brought on much discussion-protection and free trade. Lett ma make, what I may call, a statement of principles and define clearly my position. I think that such discussions are rather useless and do not shed much light on the problem to be solved. I do not favour a system of high protection which is countenanced apparently by a class of producers to the detriment of the consumer; neither do I believe in complete free trade which under the present circumstances, strikes me as an impossibility. I do not place much faith in these two political schools which belong to the past and whose methods are no more in keeping with the new conditions that have cropped up in the world since the general upheaval brought on by the greatest war of all times. A new epoch is at hand; blind is the one who is not aware of it. The economic axis, the social axis have shifted; yesterday differs from to-day. A new spirit is born; new needs exist, to which the statesman must adapt himself. In the economic sphere, in the scientific world, enormous progress has taken place within the last few years, which we must reckon with and I think it is impossible to tread the old beaten paths. It may be said

The Budget-Mr. Boucher
of economic systems, as well as of philosophical ones, that they are beneficial only in a fragmentary way. What suits a country at a given period, may certainly not suit it at another period of its development.
The nation whose legislators pass their time in discussing the old decrepit systems of protection and free trade runs the risk of remaining a long time stuck in the mire.
I have faith in a business-like tariff, aiming at giving all classes of society an equal share of justice and disturbing, the least possible, objects of general consumption and of first necessity I am in favour of continuing to give to the manufacturing industries the just share of protection to which they are entitled to develop and prosper, and I would be the last person to hinder the progress of these industries.
However, there exists in this country another industry, to my mind, far more important than the manufacturing industry upon whose success depends the prosperity of all the others, it has a working capital estimated at $6,500,000,000, and, its tillers, men, women and children represent 50 per cent of the population; they are the most peaceful the most law-abiding, the most industrious, the most worthy class from every standpoint, and yet this industry is in danger, it totters under the burden and is sadly going to ruin. I should like to see the farming industry receive the same protection, although by different means perhaps, as other industries in Canada. We have often heard, Sir, the contentions of the Western farmers in the course of the last two sessions; those of the East, although less clamorous, more discreet, are not the less afflicted and worthy of sympathy. This is a problem necessitating a solution. Canada will never be prosperous if farming lingers and dies. There still exists a marked unrest; one must realize it fully. I cannot say that the agricultural crisis which is being felt in this country, in the East as well as in the West, has received from the legislator all the consideration which its importance demands. How many members of this House still doubt that farming is in a critical stage? How many look upon the farmers as grumblers, extravagant people, impossible to satisfy? Nevertheless, it is an undeniable fact that, outside of a certain area around large towns, the farms do not pay for their upkeep. What would happen if the manufacturing industries found themselves in such an impasse? The powerful influence exerted by the manufacturers would be set in motion, parliament would be taken by storm, and no one doubts 119i
that in a very short while legislation would be enacted to remedy that state of things. The reason is that the manufacturing industry is organized, it possesses all the necessary means to protect its interests; the factory worker by slow progress, acquired through hardships, has also founded for himself an organization; he wields a powerful sword to have his wrongs redressed-strikes-and capital must reckon with him. The tiller of the soil, the man on the land is left to his own initiative. The farming industry lacks all those means and it should receive from the state the protection which is due to it so as to expand, develop and flourish. I think, Sir, that the farmer, the manufacturer and the artisan should make reciprocal concessions to one another. If I had to appeal to the natural impulse of the Canadian manufacturer, I feel confident that this appeal would bear its fruit. I shall simply point out where his interest lies, and may I itell him this:	The farming class represents 50 per cent of the consumers of this country; they, therefore, constitute the half of your best clients. If you want them to buy your products, "give them the purchasing power. The country trader complains of the lack of business, that sales are on the decrease; the wholesale merchant . does less business with the retailer and the manufacturer will soon find himself obliged to reduce his output. Does the fault lie in the lack of protection? No, it is not for lack of protection, but because the most important class of society, owing to its numbers, the farming class, has lost its purchasing power. Change this state of things, make the agricultural industry prosperous and immediately a reaction takes place in all branches of industry. This argument seems to me selfevident. I am, therefore, right in stating, Sir, that the manufacturer should relinquish his selfish plans and accept with an open mind ail measures of a nature to relieve from taxation the tiller of the soil so as to re-establish agriculture on a solid basis and give it a chance to rise and develop on an equal footing with other Canadian branches of industry.
To obtain this result, it is not enough to merely give advices to the farmer, the wisdom and seasonableness of which may be questionable. Advices are a good thing, no doubt, but it is the easiest thing in the world to give. To obtain such a result we must, first, do away as much as possible with taxation on instruments of production and the articles of first necessity. This is the present policy of the government and I want to heartily congratulate them. Secondly, we

The Budget-Mr. Hocken
must unburden ourselves of the public debt by means of the most rigid and strict economy. I wish to add, Sir, that I am a most determined partisan of economy in the administration of public affairs. I wish to give credit to the government for having suppressed this year, important amounts which were in the past uselessly spent, and I hope that it is just a beginning and that they will carry further this economy; for whoever in this House is observant in the slightest degree will readily notice that there is yearly not thousands but millions of dollars, which are squandered without any benefit accruing to the country. I strongly urge upon the government the advisability of carrying out this economic policy which the people demand and have a right to claim, and, I can predict to them that no one will be more welcome on election day. No doubt, there are other means which I do not intend to suggest; however, I think that we must not fear to depart from the trodden path and seek new remedies to meet new conditions. The legislator will not have fulfilled his duty towards the farming class if he does not give to the solution of this problem a special and continuous consideration. I am fully aware that the difficulties are numerous, but it behooves the statesman worthy of that name to rise to the level of such difficulties and solve them in a just manner. This problem must be solved by the party who constituted themselves the defenders of the people and the protectors of the weak, the champions of all the great causes, and who are actuated by the principles of equal justice and protection for all classes. I feel certain, Sir, it behooves the Liberal party to solve it.


Mr. H. C. HOCKEN (West Toronto):: Mr. Speaker, before proceeding to make a few remarks upon the budget, I should like to associate myself with my colleagues from Toronto in presenting to the government a plea for an appropriation to begin the work of elevating the railway tracks across the water front of the city of Toronto. That may not interest some members of this House; but the request for that appropriation rests upon an agreement made between the two railways and the city. The government has now assumed the responsibilities of one of those railways. The other one-the Canadian Pacific-says it is willing to go on with the work; and all that is required is for the government of the day to make an appropriation sufficient to begin the work. In connection with this matter, there are two or three facts that I
[Mr. Boucher.l
should like to lay before the House. In the first place, this is the most dangerous series of level crossings in the Dominion of Canada, and with regard to two of them, 1 think I might say, the most dangerous on the continent of North America. On holidays, and sometimes on Saturdays, as many as 100,000 people are compelled to cross twelve tracks to reach the water front, in order to enjoy the benefits of a city park across the bay. Those
100,000	people have to cross those tracks while trains are running up and down, east and west continually. What adds to the danger of thai crossing is the fact that the coach yard of the Canadian Pacific lies to the south of the train shed of the Union station. Every passenger train that is made up by the Canadiar Pacific must run out of the coach yard ovei those crossings and back over them again tc the station before the train can start. Every train that comes in and is broken up has to go through the same performance. In addition to that, every train not only passenger, but freight, that comes from the east and every train that goes to the east has to use those tracks. Hon. members will see, therefore, that I am justified in describing this as the most dangerous level crossing on the continent of North America. The people who cross those tracks are very largely women with children,-Sunday school picnics where thousands cross to Island park at one time. That situation has been recognized as dangerous by the city and by the authorities for a long time. In the latter part of 1912, the city submitted to the railways a plan for the elevation of the tracks from the station to Cherry street, or further east to Logan avenue. The railways took the plan submitted by the city and they said to us: "It is not a good plan; it is not big enough. Our engineers have prepared a plan which is a great deal better than yours, and if you will take this, we will agree to it." The plan submitted by the railways increased the cost, as nearly as I can recall, about thirty per cent. It may have been thought at the time that the city would not be prepared to share the additional expenditure. The city authorities, however, at that time accepted the situation as presented by the railways. They agreed to pay their share of the more costly work. And from that day to this, nothing has been done. I appreciate the fact that during the war expenditures of that kind should not have been incurred; but to-day we are some distance from the w'ar. Heavy expenditures are being made in other parts of the country, and surely for the protection of the lives of hundreds of thousands of people of the city of Toronto, some expenditure should be made

The Budget-Mr. Hocken
in order to remove the dangers of those crossings. Therefore, with as much energy as I possess, I press upon the government that an appropriation should be made this year for the beginning of that work which it will take some time to complete. .
In the few remarks that I have to make upon the budget, I am not going to give any figures. The House has been surfeited with statistics which have been used to prove contradictory statements. I have no inclination in that direction, anyway. The way in which the Acting Minister, of Finance (Mr. Robb) figures out a surplus simply by ignoring a bond issue of $50,000,000 reminds me of the fact that, as far back as I can remember, our provincial government in Ontario and this government, no matter which party was in power, claimed surpluses which existed by reason of juggling of figures. I do not think the people are impressed with that, and they are inclined to believe that a surplus produced by this kind of figuring indicates simply insincerity upon the part of those who are guilty of it.
For a portion of my remarks, I want to take my text from the gospel according to the hon. member for Brome (Mr. McMaster). He told us in his address the other day that one thing that has destroyed parliamentary government in some countries, and that has depreciated its prestige in others, has been the insincerity of public men. He continued:
I believe that the people of Canada are sick and tired of men, who advocate policies in which they do not believe, who advocate one thing at one time and another at another time.
The hon. member for Brome evidently had in mind the present administration. So fully convinced is he of the insincerity of the government that in order to preserve his selfrespect he was compelled last session to cross the floor of the House and to take a position of complete isolation.
I entirely agree with the hon. member for Brome when he emphasizes the value of sincerity on the part of public men, of parties, and of governments. There is a spiritual quality in sincerity that makes the possession of it inescapable to the man of ordinary intelligence; and it is just as difficult to hide insincerity as it is to obscure sincerity. I submit therefore that if there is any one thing which a man going into public life should cultivate it is sincerity. People will forgive all kinds of mistakes in their public men, and they will respect their opinions no matter how much they may differ from them. But they will not tolerate for any length of time any insincerity on the part of their representatives either in this House or in any
other representative assembly. I am going to try to prove-and I do not think it will be a difficult task-that for insincerity the present administration outclasses anything we have ever had in the history of Canada. They have attempted to overlay their unreliability with an appearance of sincerity, but in that they will not succeed.
Let me go back to the platform of 1919, when the Liberal party in solemn conclave adopted a plank practically of free trade, or at least one looking towards the continuous lowering of duties until free trade should be approximated. That was done, of course, as an appeal to the free trade party in Canada. And there are a good many men in the different provinces who believe in free trade. At any rate, the purpose of that plank was quite evident to the people. Well, when the time -of the general election came along in 1921, instead of standing squarely on that plank of the platform, men representing the party at present in power gave secret promises to the business interests of the country that- there would be no lowering of duties. In that act they proved their insincerity as a party. They had publicly declared their intention of reducing the duties, but they went behind the backs of the masses of the people to the business and financial interests of the country and said, "We will not do anything of the kind."
Now we have the hon. member for St. Lawrence-St. George (Mr. Marler) telling us in his address that he had the consent of Liberal leaders of repute to take a position on the tariff policy altogether different from that enunciated in the platform of 1919. And that hon. member has declared in this House also that his action was confirmed by the utterances of his leaders in the province of Quebec. He came into the House understanding that the tariff plank in the platform of 1919 was designed for the purpose of getting in upon but was not intended to be carried out and applied in the management of the public affairs of the country. He came in under misrepresentations. Now he has been convinced by the present budget that the Liberal platform of 1919 in regard to the tariff is after all to be carried out. And not only that, but the concessions which have been made to-day by the present budget are only a beginning in the direction of considerably lower duties. I submit that in this declaration of policy in the platform of 1919, and in the promises and the pledges which the party opposite made behind the backs of the people, the insincerity of the government is amply established. But we can go further than that. As the Liberal leaders, according to the hon. member for St. Lawrence-St.

The Budget-Mr. Hocken
George, gave these pledges that they would not reduce the duties, so in the first two sessions of the present parliament they implemented the promises they had made. They carried out the undertaking given to the business interests of Canada for the first two sessions. But now, in the third session, finding themselves in a minority, and having a desire to cling to office no matter what kind of violation of pledges is required, no matter how clearly they may betray their insincerity, they proceed to carry out the tariff plank of 1919. For two sessions the government adhered to the secret understanding which they had had with the manufacturers of the country, and they adhered to it so closely that hon. gentlemen to my left, the Progressives, found it necessary last year to introduce an amendment to the budget. And the hon. member for Brome was forced, by his conscience I suppose, to cross the floor of the House into a place of opposition. This year, I say, after having observed the secret understanding /with the manufacturers for two sessions, the government, driven into a comer, proceeds to carry out the tariff plank of the 1919 platform and has brought down a budget which in itself, and in the method by which the duties are to be reduced, is an act of insincerity almost without parallel, as I shall endeavour to show.
In order to secure the support of the agrarian group in the House the government, apparently, a short time before the session opened, discussed the matter with at least leaders of that party and then came into the House, first with a Speech from the Throne that threatened reductions in the duties, and then with a budget making good that threat. By that action they have secured the support of the Progressives. They have reduced the duties on agricultural implements and implements of production, and then they proceed to bonus the industries that manufacture those implements, while reducing the duty 4 per cent or thereabouts, they hand to the agricultural implement industries concessions which carry more protection for these industries than they enjoyed before. I say that is an act of duplicity towards the manufacturing interests of the country. The government having reduced the duties on implements, hand over to the manufacturers a bonus of 5 per cent from the public treasury; for the removal of the sales tax is equal to a bonus of 5 per cent. And they give these industries their raw materials free, which is another concession the exact percentage of which I have not been able to calculate. Then, according to the Minister of Agriculture (Mr. Motherwell), they are going to put

into effect freight rates for the benefit of agricultural implement makers which will amount to another 3 per cent. So that, to sum up, the government has reduced the tariff by 4 per cent, and has handed to the manufacturers concessions equal to about 8 per cent entirely in addition to the advantages they will derive from free raw materials.
A more devious method of reducing duties could hardly be devised. On the surface, they have reduced the duties on' implements, as a matter of fact, the burden of that reduction has been placed entirely upon the steel and other industries that provide the raw material for the implement manufacturers. I ask hon. members in all seriousness:	If it is fair
and just to levy a 5 per cent sales tax on our industries generally, why should the agricultural implement industry be exempt? Are there not other industries just as deserving of consideration as this favoured industry? If the principle is right, if it is fair to levy a 5 per cent sales tax on the lumber industry, which is one of the most important of our industries, so that the cost of all building construction is increased to that extent, is it not equally as fair to reduce this cost for the benefit of the people generally as it is to reduce the price of agricultural implements for the benefit of a small percentage of the people? But I submit, Sir, that it is repugnant to sound principles of legislation that certain classes of business should be relieved of imposts, the burden of which has to be borne by others. No government can afford to play favourites in respect to the tariff, the levying of the sales tax, and the granting of preferential freight rates.
In my opinion, Sir, from the beginning to the end this interference with the tariff has demonstrated the insincerity of the government. First we had a declaration for lower duties, then the secret promises that those duties would not be lowered, then the violation of those promises, followed by the lowering of the duties and putting the whole burden on an entirely different industry. If that is not a proceeding unique in the political history of this country, then I have not followed it correctly.


Mr. SPENCER:: Did I understand the
hon. gentleman to say there had been secret promises given that the tariff duties would not be lowered?


Horatio Clarence Hocken: Yes, sir.


Henry Elvins Spencer: Will my hon. friend
kindly specify those secret promises?

The Budget-Mr. Hocken


Horatio Clarence Hocken: We had a statement to
this effect from the hon. member for the St. Lawrence-St. George division (Mr. Marler). Perhaps I had better give the statement to my hon. friend again, and then add some others for his information. The hon. member for St. Lawrence-St. George is a responsible member of this House, and this is what he said as I have copied his remarks from Hansard:
He had the consent of Liberal leaders of repute to take a position on the tariff policy altogether different from that which was enunciated in the platform of 1919. He declared that his action was confirmed by the utterances of his leaders in the province of Quebec.
If my hon. friend wants some further evidence let me quote from the French newspaper La Minerve, as it appeared in the Montreal Gazette of April 23rd last.


Mr. MACDONALD (Pictou):: Does La
Minerve support this government?


Horatio Clarence Hocken: I am assuming that the
paper tells the truth.


Edward Mortimer Macdonald: I think it is a paper very close to my hon. friend and his party.


Henry Lumley Drayton: Then it is more likely to be truthful.	.


Horatio Clarence Hocken: I am going to read what
the newspaper says, because its statements are very definite. This is the article:
The King government is finally deciding to throw aside the mask and reveal its true traits underneath -those of a sworn enemy to the tariff policy inaugurated by Macdonald and followed next by Laurier, the national policy of protection. It does not hesitate to betray the formal promises made to the electorate of this province in the course of the 1921 campaign, by Sir Lomer Gouin and the other Liberal leaders. It no longer hesitates to repudiate the solemn assurances of tariff stability given at the last session by Sir Lomer Gouin and Mr. Fielding. Laurier dead, Sir Lomer absent, Mr. Fielding sick, free trade comes up on the bill as the first article of the Liberal programme, while protection, on the contrary, becomes the enemy to be fought, whose head must be cut off, trampled under foot, and the rest scattered to the four winds of heaven. Since those who should serve it, betray it, it is necessary that the Canadian people take a hand in its own defence, as it did in 1878, and as it did in 1911. The older ones have not forgotten " the terrible years " which marked, fifty years ago, the first trial of free trade.


Edward Mortimer Macdonald: Does my
hon. friend think this extract from a strong Tory paper like La Minerve is any evidence on the subject which he is discussing?


Horatio Clarence Hocken: I offer it as confirmation
of a statement by a very prominent member of the Liberal party in this House, a man who entered parliament with the expectation on the part of a great many people that he would become finance minister.


Edward Mortimer Macdonald: Who told
you that?


Horatio Clarence Hocken: That was the current
report in the lobbies.


Mr. CASGRAIN:: Not the best source
of information.


Horatio Clarence Hocken: However, the Minister of National Defence (Mr. Macdonald) will not deny that the hon. member in question is a prominent Liberal member.


Edward Mortimer Macdonald: You were
talking about whether he was going to be Minister of Finance.


Horatio Clarence Hocken: I said he was reported
to be training for the post.


Edward Mortimer Macdonald: Training?


Horatio Clarence Hocken: Not now.


Mr. MARTELL:: Will my hon. friend tell
us what the Orange Sentinel said?


Henry Lumley Drayton: That also
would be accurate.


Horatio Clarence Hocken: My hon. friend can depend on this. Mr. Speaker, that whatever the Sentinel says is the truth, although the paper has not yet dealt with this particular question.


Lewis Herbert Martell: Truth according to the
hon. member.


Horatio Clarence Hocken: Truth according to the
truth.


Lewis Herbert Martell: That is, according to the hon. member.


Horatio Clarence Hocken: Not according to the Nova Scotia idea of truth.


Lewis Herbert Martell: Truth according to the
quintessence of hypocrisy.


Henry Lumley Drayton: He does not
mean that.


Horatio Clarence Hocken: I do not think he means
anything.


Lewis Herbert Martell: He would not expect to
take the hon. gentleman seriously.


Horatio Clarence Hocken: I do not know, Mr. Speaker, whether anyone takes the hon. member across the way seriously. We find him butting in on every debate and interrupting with irrelevant remarks every speech that is made on this side of the House.


Lewis Herbert Martell: Because it is all nonsense.
The Budget-Mr. Hocken


Horatio Clarence Hocken: If there is any member
who should not be regarded seriously in this House I think it is the hon. gentleman himself. This statement may be by a Conservative paper, but no paper would dare to go as far as it has gone and mention the names of men who gave those secret assurances if it had not sufficient ground to warrant its assertions. Besides, the article confirms the statement made by the hon. member for St. Lawrence-St. George.


Mr. GUTHRIE:: And the hon. member for Brantford (Mr. Raymond).


Horatio Clarence Hocken: Yes, and the hon. member for Brantford too. I have another quotation from a paper published at Three Rivers, Le Nouvelliste. I do not know whether it is a Conservative paper or not. However, it says:
The present budget is like a finger placed in the wheel. The act is always exceedingly dangerous. If the whole arm is not drawn in, there is the risk of leaving at least a part of the skin. What will be the result of this new orientation? It will please the Progressives as much as it will displease the protectionists, not only the Conservatives, but the Liberals also. It outlines in advance the ground on which the next political battle will be fought. The immediate result is that it will increase the uneasiness from which a number of our industries already suffer. The workman who finds his source of livelihood in the work which the industries provide for him will not be the last to resent the reaction. Then there will be the farmer producer, of whom the workman, in the role of consumer, is the client. His buying power being further reduced, the workman will consume less of the farm products.
That is the opinion, evidently, that prevails in the province of Quebec-that this budget is. a desertion of the Laurier. policy. I am not surprised at the business men of the province of Quebec accepting the representations made to them, as was stated by Le Nouvelliste, giving the name of Sir Wilfrid Laurier. These same men, Mr. Speaker, had received similar pledges and promises from Sir Wilfrid Laurier years back. In 1896 assurances were given to the manufacturing interests of this country that they were in no danger from the lowering of the tariff. They acted upon that; they took Sir Wilfrid Laurier at his word. Sir Wilfrid was a man of his word and he carried out the undertakings that weTe given at that time. Naturally these same men or their successors in the industries of the country would suppose that similar assurances given at this time would be similarly carried out, but they quickly discovered that they had a different set of men to deal with.
I stated, Mr. Speaker, that while the duties have been reduced on agricultural implements,

the agricultural implement manufacturers are not the ones to suffer; the burden has been placed upon others. I want to read a paragraph from an interview given by the secretary treasurer of the Steel Company of Canada, located at Hamilton. He says:
Our industry is absolutely dependent upon an adequate protective tariff. In the past we have sold the International Harvester Company as much as $3,000,000 or $4,000,000 worth in one year. It seems to me as if the government has made a butt of tjie steel and iron industry*! The budget certainly strikes us hard. Under the conditions imposed upon us by the budget I don't see how we can hope to compete with the United States.
So the relief to the farmer is a reduction of duties on implements, and the implement manufacturer is relieved by the handing of this burden over to the steel maker-the whole thing done in such a way as, I am sure, will convince the people of the country of the insincerity of the government.
But the worst feature of this budget, as I see it, is the widespread unrest that it has caused throughout the country. No manufacturer in Canada feels so sure of the immediate future that he would invest $10,000 in any enterprise at this time. These men have been living on their reserves for the last three years, and. in many cases those reserves are exhausted, they certainly cannot hang out much longer. This threat of the "death knell of protection" has put all our manufacturers and many of our business men who are nol manufacturers, in such a position that thej are afraid to make any investments, afraid to make any expansion of their bus-
5 p.m. iness, and they are retrenching in every possible way. Could any other result have occurred than an exodus from the country such as is now going on, and has been going on almost ever since this government got into power? If you go to the Detroit river you find the ferry boats crowded with Canadians who are going over to work in the United States, the trains are filled with the settlers' effects of Canadians who have gone to that country, to reside permanently. This exodus is not going to be stopped by lowering duties, by putting the manufacturers of Canada in such a position that they are afraid to make any extensions and are forced to retrench.
That.it is the intention of the government to. continue the lowering of duties until we get approximately free trade must be taken, I think, as an accepted fact. The Minister of the Interior (Mr. Stewart) read a carefully prepared memorandum which must be accepted as a declaration of government policy. While it is unnecessary to follow his remarks

in detail, one phrase he used stands out with great vividness, namely, that the "death knell of protection" had been sounded.


Henry Elvins Spencer: Hear, hear.


Horatio Clarence Hocken: My hon. friend says, "hear, hear." What do hon. gentlemen to my left care whether the people of Toronto or of the county of York-as the hon. member for Peel (Mr. Charters) pointed out the other night, having as many people as there are in the whole [DOT] province of Alberta-what do they care whether they drive those people over to the United States? What does my hon. friend care as long as he can save $5 this year on his implements? That kind of spirit will never build up a great country, you must have something different from that.
The hon. member for Brome (Mr. Mc-Master) spoke of protection as an appetite. Well, I would describe free trade as a delusion. My hon. friend will know how futile it is to argue with the man who is suffering from a delusion; in fact, when he reaches a certain point he is put under restraint. A man who is deluded with the theory of free trade is just about as hopeless to argue with as a child who knows nothing about it.


Mr. WARNER:: I would like to ask a question. Does my hon. friend think that rhe Massey-Harris Company is under a delusion ?


Henry Lumley Drayton: They are under a bonus.


Horatio Clarence Hocken: Not at all; I thought I
had made it plain to my hon. friend that while this budget ostensibly hits at companies such as these, it increases their protection. It relieves them of the 5 per cent sales tax. It give them the benefit of 3 per cent in freight rates.


Mr. CAMPBELL:: Will the hon. gentleman tell us if he is complaining about-


Horatio Clarence Hocken: Just a moment;. one at
a time. It gives them 3 per cent advantage in freight rates; it gives them their raw material free. Their protection, I should think, would be at least 30 or 40 per cent more thai. it was before the budget came down, but the burden is carried by other industries which have to rest more or less upon the implement industry.


Mr. FORKE:: It may be an advantage, but it is not protection.	*


Henry Lumley Drayton: It is privilege.


Robert Forke: It is not protection.
The Budget-Mr. Hocken


Horatio Clarence Hocken: I do not care what you
call it; it is a concession that enables the Massey-Harris Company to make more money under this budget than they made under the previous budget. Call it anything you like, but if that is not protecting industry then I do not know how to do it.
I will tell you how it came about that the western men got this free trade bug into their heads. For a good many years the Grain Growers' Guide talked free trade. The farmers of the West-the grain growers' organization, of course-grew up; they started a great weekly paper, and that paper talked free trade, free trade, free trade, to the people of the West day in and day out. The people never heard the other side of the argument. Nobody ever said to them that it was better to have a moderate tariff to build up industries, to have diversified industry in this country, than to try to make the whole country rest upon the agricultural industry. Nobody ever went that far, and by the propaganda carried on by the Grain Growers' Guide the people of the three prairie provinces have got it into their heads that no matter what the government does the only thing that will help them is free trade. A greater fallacy could not possibly exist. If free trade were inaugurated in this country tomorrow I am perfectly satisfied that those who would ultimately suffer the most would be the farmers of the western prairies. This is the way it would work out:	In the first
place, the. industries of Canada would be destroyed and then they would be at the mercy of the great trusts of the United States, and those great trusts might be under some restraint by their own government, but could not be restrained by the Canadian government.


Robert Forke: I am not objecting to the
hon. member's argument so much as to his statement as to the ignorance of the people in the prairie west.


Horatio Clarence Hocken: I think the hon. gentleman is hardly fair in saying that I called them ignorant.


Robert Forke: You said they read nothing but the Grain Growers' Guide.


Horatio Clarence Hocken: I say they never hear
the other side of the story, and in my judgment the manufacturers of this country are to blame for that, for while the people of the West are being fed free trade there should have been some antidote administered to keep their minds from being poisoned. It
The Budget-Mr. Hocken

would have been much to their own advantage.
Now Mr. Speaker, I venture to make this assertion:	There is no nation in the world
to-day that is great, and no nation can become great, without a policy of protection to build it up. There is no great nation in the world to-day that has not got a protective policy except Great Britain, and Great Britain established its industrial pre-eminence through protection.


Robert Forke: That has been repeated
time and again.


Horatio Clarence Hocken: But it seems necessary to repeat it to get it through the thick head of my hon. friend from Brandon.


Robert Forke: Hear, hear.


Horatio Clarence Hocken: There is only one way
to get an opening into some people's brain, and that is with a hammer.


Mr. HOEY:: Repetition does not necessarily make it true.


Horatio Clarence Hocken: No, but I am asserting it because it is true. If my hon. friend will go back to the time when industries did not flourish in Great Britain, he will find that at one time immense quantities of wool were grown in England. England at that time was a wool exporting country. It sent the wool to Flanders, where it was made into cloth, and then it was shipped back to England and bought at high prices by the English people. After a while the English people woke up and said:	Why cannot we make this cloth ourselves? And they put an export duty on wool and stopped the wool going over to Flanders, and the result of that was that they established weaving industries all over England. The English people began making their own cloth, and from cloth they went on to cotton, and from one thing to another until England became the greatest industrial nation in the world. But all that rested upon a policy of protection in the finst place. And that is what made the United States great also. You have not got to go very far back in their history, to the time of the Civil War only, when the United States was the greatest customer the British industries had. But after that time the United States established a policy of protection, and the exports from England to the United States have been falling off ever since and the United States has been growing in population and wealth. So I contend, Mr. Speaker, that this country which has such enormous natural resources ought to adopt a trade policy that will enable us to sell our finished product. Providence has endowed

us probably to a greater extent than any other country in the world with great natural resources, and in some particulars Providence has given us a monopoly. We have all that is necessary to make this a great country both in population and in wealth, but in order to do that we must have diversified industries established in the fitting sections of this country, in order to provide employment for the artisans who will work in our factories.
I said before, Mr. Speaker, and I repeat now, that if our friends in western Canada have sufficient patriotism and are willing to assist in making Canada the great country that it is capable of being made, they should accept a moderate protective tariff, or as my hon. friend from St. Lawrence-St. George (Mr. Marler) calls it a cost of living tariff, a tariff not high enough to secure excessive profits to the manufacturer, but a tariff high enough to secure employment to the artisans of this country. If our friends were reasonable enough to accept that they would find-and even without showing any willingness to accept that, they are finding now-that the eastern provinces of Canada, both through their business men and through their representatives in this House, are ready to do everything that can be suggested to add to the prosperity of the western provinces.


Daniel Webster Warner: I would like to ask my
hon. friend why protection has not done in the last forty or fifty years what he claims it is going to do now?


Horatio Clarence Hocken: Well, we have nine millions of people and our friends over the border have one hundred and fifteen millions. They are able to engage in mass production that is impossible in Canada, and it is quite impossible that this country could have been built up to the point where it could adopt free trade against the high tariff of the United States in the short period we have had to develop our industries. That is my answer to my hon. friend whether he will think it sufficient or not.


Daniel Webster Warner: Will protection create
more people and more wants?


Horatio Clarence Hocken: I can tell my hon. friend
this: When the protective policy was established in this country, the city of Montreal had about 250,000 people or less; to-day it has about 800,000 people. The city of Toronto had less than 100,000 people and to-day it has almost 600,000 people.


Mr. FANSHER:: I would like to ask my
hon. friend how much the rural population ol Ontario has been depleted in the last twenty years to help build up Toronto.

The Budget-Mr. Hocken


Horatio Clarence Hocken: I think those members who come from western Canada ought to be able to answer that question better than I.


Robert Forke: The hon. member knows
that the population of Toronto increased last year.


Horatio Clarence Hocken: I was answering the other hon. member. I say that if the rural population of Ontario has decreased, it has been for the benefit of the West. There are tens of thousands of Canadians in western Canada who were born in the province of Ontario and have gone out West to take up land there.


Robert Forke: I would draw the hon. member's attention to the fact that while he speaks of the depletion of the population of Canada and the exodus to the United States, the population of Toronto increased very much during the last year, so Toronto cannot be such a bad place to live in, notwithstanding all the hard tales we hear.


Horatio Clarence Hocken: We have the figures for last year which show there was a slight increase in the population of the city of Toronto but it was stated at a Rotary Club dinner in Toronto the other day by a responsible man that there are 7,000 vacant houses and apartments in the city of Toronto to-day. That will indicate to my hon. friend the extent of the exodus that has taken place from the city of Toronto since the last returns have been compiled, which would be April or March of last year.


Burt Wendell Fansher: Where did they go?


Horatio Clarence Hocken: Largely to the United
States.


Burt Wendell Fansher: Why are they not patriotic like the agrarian citizens; why do they not go to our own Canadian West?


Horatio Clarence Hocken: I understand from what
my hon. friends have said, that the patriotic citizens of the West are going over to the United States too. Have we not heard some calamity howling from that part of the House about the exodus of farmers from the West to the United States, of men who had abandoned their farms and their homes and left their debts to somebody else, and gone over to the United States?


Daniel Webster Warner: I do not think protection
has helped them.
. Mr. HOCKEN: Certainly free trade is not going to help populate the country. When you consider the decrease in the rural population it must be remembered-


Robert Forke: Keep in mind that we are
not saying anything about the citizens of Toronto, not in the way in which you speak of the people of the prairie provinces. We never find any fault with the citizens of Toronto, about the way they live and what they are doing.


Horatio Clarence Hocken: I am not finding fault
with the people of the West. I say they have a wrong idea of the tariff.


Robert Forke: We hear day by day of the blunders and mistakes and the foolishness of the West.


Horatio Clarence Hocken: There may be some reflections once in a while upon the members from the West, but I do not think I am guilty. It is only necessary to say one word about Toronto, and from this side of the House and the other side of the House we hear-


Robert Forke: No, no, no.


Horatio Clarence Hocken: Yes, yes, yes, over and
over again.


Robert Forke: I deny it.


Horatio Clarence Hocken: We hear the expression
"Oh, that is Toronto." That is the kind of stuff we get and we get a great deal more of it than others get from the city of Toronto.


Robert Forke: I defy the hon. member to find anything in my speeches in this House directed against Toronto.


Horatio Clarence Hocken: I concede that, but there
are other members to my left besides the hon. leader of the Progressives.


Henry Lumley Drayton: They are all
free members.


Horatio Clarence Hocken: When I was interrupted
I was proceeding to point out to the members from the West what this House is doing for the West. What is eastern Canada, which is well represented here, doing for the West? In the first place, we voted $28,000,000 for branch lines, the greater number of them to be built in the western provinces, and I venture to say before they are completed the expenditure will run over $50,000,000.


Henry Elvins Spencer: Do you begrudge the
building of these railways?


Horatio Clarence Hocken: No, I do not. My hon.
friends are hypercritical. I am not begrudging them. I say that is what we have agreed to do for the West. If the hon. members of this House begrudged the expenditure they would not pass the measure.

The Budget-Mr. Hocken


Henry Elvins Spencer: Do you begrudge it?


Horatio Clarence Hocken: No, I do not begrudge
it either. The people of eastern Canada are anxious to do everything to promote the prosperity of western Canada, and as evidence of that I offer the fact that this House voted
828,000,000 for the construction of branch lines on the prairies, to bring every farmer as close to a railway as he could get. That is only one thing. Money was voted last year, and more will be voted if it can be shown to be required, for an exit for the produce of the West by the port of Vancouver which is being developed. Two million dollars was voted last year for the construction of an elevator in that city, and this House will do more than that to give the prairies another outlet for their grain. In addition to that, I think this House on the whole looks favourably upon the completion of the Hudson Bay railway. I do not believe there is going to be any relief secured there, but the House has certainly not put itself on record as opposed to that project. In addition to that we have under discussion now-and I hope the project will be carried through-an enormous expenditure to deepen the canals of the St. Lawrence river, and save from five to eight cents a bushel on every bushel of grain grown in the prairies.


Milton Neil Campbell: Does the hon. gentleman suggest that that will be a material benefit to western Canada?


Horatio Clarence Hocken: If my hon. friend does
not regard the saving of five to eight cents a bushel on transportation of western grain to the ocean as any advantage-


Milton Neil Campbell: That is not proved yet.


Horatio Clarence Hocken: That is what the experts
tell us. That is what we are investigating, and if it be found that that will be the result, this work will be undertaken, $250,000,000 will be spent upon it, and the primary benefit, in fact practically all the benefit, will go to the people in the three western provinces.


Milton Neil Campbell: The three western provinces are not asking for it.


Horatio Clarence Hocken: In addition to that they
get lower freight rates for their grain than any other part of Canada. The Crowsnest pass rate is given to the West, and the result is that Ontario and Quebec are unable to get a single cent reduction in freight rates. There was talk two years ago of a' general lowering of the freight rates; but when the Crowsnest pass rate was given to the West

all the rest of the country had to go without any reduction in rates.


Mr. GARDINER:: Have the Maritime
provinces not received substantial reductions?


Horatio Clarence Hocken: They are promised now.


Robert Gardiner: Have they not received them ?


Horatio Clarence Hocken: I do not understand that '
they have, but they have been promised.


Arthur Meighen: A very slight reduction.


Horatio Clarence Hocken: Ontario and Quebec had
to go without any reduction in order that the West might get the advantage. I am not cursing the West or anything of that kind. I am trying to convince my hon. friend,-if it is possible for a man from Toronto to do it-of which I have some doubt

that the people of the eastern provinces of Canada are as keenly desirous to see the West prosper as they are desirous to prosper themselves, and they are showing it by a willingness to incur enormous expenditures to advance the prosperity of the West.
I believe that every section of Canada should be considered in the national policy. I think that, if we are to reach that point and get a policy that will serve the interests of all the different divisions of this country, every one of us must be willing to make some concession, and the concession I ask from the West is the acceptance of a moderate protective policy.
I was disappointed to hear the hon. member for Last Mountain (Mr. Johnston) talk of secession. He made a remark to the effect that unless the West got what it required there would be "political disintegration." I do not think that is the kind of language to use in this House. I do not believe it represents the sentiments of the West. He made some other remarks that were altogether incorrect but perhaps it is not necessary to deal with them. I do not think the people of western Canada sympathize with any such declaration as he made. When we look over the war record of the provinces of Alberta, Saskatchewan and Manitoba, I for one conclude that there is no more loyal element in our population than the people residing in those provinces, and if it were the purpose of my hon. friend from Last Mountain to throw a scare into us, I would like to tell him that he failed.
We do not hear very much in this House about the sufferings endured by the business interests of Canada. I think it is about time someone ought to say a word on that point. We have heard continually about the suffer-

The Budget-Mr. Hocken
ings of the farmers, and the most of the talk is in reference to the sufferings of the prairie farmers. But I can tell my hon. friends that the figures given in the business profits tax returns show that the business interests of this country are and have been suffering during the past three years just as keenly as the agricultural interests. If you will take the last returns for. the business profits tax brought down in this House a few days ago, you will see that the amount collected has dropped from $44,000,000 in 1921 to $4,000,000 in 1923-24. What is the meaning of that unless it is that there is a terrible depression in business. If you take out of that $4,000,000 the amount paid by the pulp and paper industries and the mining industry,-perhaps the only two industries that are enjoying prosperity in Canada,-you find that general business and general manufacturing have been hardly able to pay anything in that respect.


Burt Wendell Fansher: Is the business profits
tax in force in this country now?


Horatio Clarence Hocken: You bet it is.


Burt Wendell Fansher: I understand the business profits tax was repealed by the late government. .


Horatio Clarence Hocken: I am paying taxes on the
[DOT] business profits I make. My hon. friend the ex-Minister of Finance (Sir Henry Drayton) tells me I am giving it an incorrect name.


Henry Lumley Drayton: It is the corporation income tax, which is a good deal higher to-day than the excess profits tax was.


Horatio Clarence Hocken: I have just a word or two more to say. Yesterday the Minister of Agriculture (Mr. Motherwell) said that the issue of protection and free trade is joined by this budget, and that it will be the question on which we shall go to the people at the next general election. The hon. member for Battleford (Mr. McConica) says:	"Yes,
and we will trim you to a peak". I do not like his spirit. I do not want to trim anybody to a peak.


Robert Forke: It is the sentiment which
the hon. member does not like.


Horatio Clarence Hocken: It is the fact that I
entirely deny. Instead of trimming us to a peak, I think the hon. member for Battle-ford will be trimmed to a peak. The result cannot be otherwise. In the provinces contained in this confederation seven-ninths of the population are favourable to protection. Is it conceivable that the three prairie provinces occupied by two-ninths of the population of Canada will be able to swing the seven-ninths at the next general election?


Henry Elvins Spencer: Would the hon. gentleman lead the House to believe that the three prairie provinces are the only provinces wanting free trade?


Horatio Clarence Hocken: Yes.


Henry Elvins Spencer: How about the Maritime provinces?


Arthur Meighen: Did the Minister of
Agriculture not assure my hon. friends that nobody was tnIking free trade?


Horatio Clarence Hocken: I think the political
history of this country shows that there are only three provinces that favour free trade.


Henry Elvins Spencer: What about the Maritime provinces?


Horatio Clarence Hocken: Whenever the issue in this country has been protection versus free trade, the Maritime provinces have voted for protection-I do not think my hon. friend can dispute that-it was so in 1878, 1891, and in 1911.


Burt Wendell Fansher: There has never been
a free trade issue.


Horatio Clarence Hocken: No free trade issue in
1878? My hon. friend was not born then and perhaps, he is to be pardoned for not knowing that fact. I was alive then and I know the fight that was made in 1878. I know the fight that was made in 1891 when the Liberal party went to the country on a policy of unrestricted reciprocity, when the Hon. Edward Blake deserted his party because he did not believe in unrestricted reciprocity.
I know what happened in 1911, and those were the three occasions when the issue in the general election in this country was protection versus free trade. So, if we are to take what has happened in the past as an indication of what will happen in the future, we must conclude that the hon. member for Battleford will be trimmed to a peak, and that we shall have in this Dominion a government that will give us a cost of living tariff.
I have never had anything but -the warmest possible feelings of friendship for the people of every province in Canada. I am a Canadian. I was born in this country. I have lived here all my life. I have never lived a year out of it. I have a love for Canada such as is held by men who are born in the country. I have a vision of this as, perhaps, the greatest country in the world at the end of this century. But we can never reach that objective-we can never fulfil the destiny which the Almighty has designed for us,- unless we sit down, province by province, and figure out a national policy that will take
The Budget-Mr. Casgrain

care of the interests of every one of them. The province of Ontario, under such an arrangement, will have to make some concessions. So will the province of Quebec and the Maritime provinces, and so should the western provinces. The one thing that I ask them to do is to look at this question of protection from the standpoint, not of whether they can save a dollar or two dollars or three dollars on a binder, but of whether the great industrial cities of this country are to be preserved as places of population, of wealth, reservoirs from which to draw taxation with which to meet the war debt of this country, and to contribute in the thousand ways in which big centres do contribute to the welfare of this Dominion of Canada.
Mr. PIERRE F. CASGRAIN (Charlevoix and Montmorency) (Translation):	Mr. Speaker, I do not wish this debate to close without associating myself with those who preceded me in expressing my regret at the absence of the right hon. Minister of Finance (Mr. Fielding) who, owing to a protracted illness, has been prevented from delivering his seventeenth speech on the budget. All acknowledge that he is an outstanding figure, an able statesman, a financier without an equal and of undaunted courage, who so well managed the finances of the country during the fifteen years of Liberal administration of the late and lamented Sir Wilfrid Laurier, that he was able to give the country this era of prosperity of which he was an eye-witness from 1896 to 1911. If we did not always agree with his views on certain questions, we must, however, state that he has been a man absolutely sincere and convincing.
Allow me, Sir, to congratulate the Prime Minister on his able choice in appointing to the post of Acting Minister of Finance, the hon. Minister of Immigration, the member for Chateauguay and Huntingdon (Mr. Robb). A consummate man of business, tried by experience, resourceful, he has proved worthy of the task which was confided to him. He energetically buckled down to work and was able, in a short time, under very difficult circumstances, to master all the details of the Department of Finance. Distinguished economist, he understood the present needs of the people and was able to present to the House and country an entirely acceptable budget. We had been for a long time expecting this budget. Those on the right with confidence-the others -those of the official opposition-with fear, and our friends, who sit opposite me, with doubt and great interest. Those who sit on
your right, Sir,-and I am one of them_______are
fully satisfied with this budget. It discloses,

so we see, a satisfactory state of affairs throughout the country, under present conditions. We have first, a surplus-according to the statement of the Acting Minister of Finance; secondly, a decrease in the debt; thirdly, a reduction in taxation, and fourthly-something rather astonishing-the lowering of the tariff and, neverthless, the balancing of the budget. The hon. Acting Minister of Finance must be congratulated on his work, and I think that the whole population of Canada and the party to which he belongs must acknowledge that he has done good work. The Canadian government under the able and wise leadership of the Right Hon. W. L. Mackenzie King, must be congratulated for having been able, in the space of hardly two years, to put our finances on a solid basis and improve our situation, in a general way, without harming agriculture, without injuring the manufacturing industry or the other industries of the country. These are the points which I want to touch upon in the course of my remarks that I shall submit to the House.
Immediately after the budget had been laid on the Table, we read, in many newspapers throughout the country, of rumours and criticisms of a nature to please certain classes of the population opposed to this budget. Nevertheless, all the members representing rural districts, all those who are not closely connected with the big interests, briefly all free men, all those in whom a generous heart beats and are thoughtful of the people's interests can say with confidence: Here is a government who has well sized up the situation and endeavours to do something for the people; here is a government who is trying to lighten the burden of the consumer, by reducing the taxes-which will have for effect to bring down the cost of living; here is a government who tries to fulfil its election pledges and put into practice the policy which it proclaimed when in opposition. Those that we hear recriminating and complaining as regards the budget, are the wealthy bankers, the large manufacturers, the trusts, and those who, protected by certain laws, were able to build up colossal fortunes and become magnates of finance, multimillionaires of the country. Those are the people who wish to dictate a line of conduct to certain governments, through their subsidized press. No doubt there are exceptions, but in a number of large towns it is not less true that, since the delivery of the budget speech, important newspapers have endeavoured to convince the people that the budget, is not in their interest. I think we must put the people on their guard against this faction who try to misrepresent the question and induce the people of Canada to believe that the

The Budget-Mr. Casgrain
government has not at heart the best interests of the country.
The principle applied in the budget is one of the soundest and most equitable of economic principles. Providence decreed that the people should reap the products of the soil with the least restrictions possible, and all impediments to trade and exchange of these products-if it is done without discretion-may become a hardship, may bring on a calamity for the population in general, although incidentally it may enure to the advantage of certain classes of people. However, what every wise government having the interest of the people at heart should endeavour to effect, is to place on the statutes of the country laws which, while giving revenues for the administration of public affairs, will better the conditions of all the classes of society. It is important that the taxes should not weigh too heavily upon those who are the least able to bear them. We must endeavour to distribute the taxes among those who are able to withstand them more easily. While on the subject, I may point out to you, Sir, the example given by the province of Quebec which, in its legislation, on a smaller scale than that of the Ho-minion government, apportioned the taxes among the wealthiest class, in such a way as to unburden the poorer classes, and better the conditions of the farmers in particular.
By the drift of this debate, we are aware that, to-day, as in the past, the great question is to know who wants a high tariff and who favours a low one, in other words who stands for protection and who desires free trade.
Judging from certain of their utterances, hon. members sitting on your right, Sir, endeavour to hold the Liberal party as a whole responsible for these sentiments, their words implying that the government is going to wrong the people and change the policy of this country for unlimited free -trade. Those who conclude from various speeches that the Liberal party is an absolute free trade party, are entirely mistaken. No one, belonging to a party, not even a member of the government can tie down the other members of that party, if they do not share entirely his views. The true policy of parties is known, the line of conduct they must follow is known, because when in opposition they proclaimed that policy and when in power they endeavour to put it into practice. The hon. member for St. Lawrence-St. George (Mr. Marler) stated, a few days ago, that one must only consider .what has been done by a party when in power and take no account of the policy which it proclaimed while in opposition. We cannot set aside the programme of a political party in opposition and merely go by its policy when in power so as to judge of the line of conduct which i-t will adopt in the future.
We know that the first to taunt us, to-day, for our attitude, because we lower the tariff on farm implements, are those who, last year and the preceding years, even when we were in the opposition immediately after our 1919 convention, were asking us to enact some of the most important articles of the programme of this convention. And to-day, because we -try, so as to lighten the burden of the farming class, so as to better the general conditions of the country, to enact a certain part of our programme, they tell us that our policy was not the right one, yet, they are the same gentlemen who, at that time, told us to put it into practice. They taunt us -also for giving too much to the western farmer's party, and, on the other hand, they ask for a higher protection and state that we shall be able, with such a protection, an adequate one, a protection to cover all our industries, to remedy all the evils which are supposed to be the present cause of the instability of the country. I do not think, Sir, that what we are actually doing is of a nature to hurt the industries, the factories and the large commercial institutions of our country. I think that on the contrary, the lowering of duties on farm implements as mentioned in the present budget is of -a nature to improve -t)he lot of the farming class, and representing an entirely agricultural county, a county situated in the province of Quebec, where there are some factories, but especially pulpwood mills, I cannot do otherwise than give my entire support to the government for the sound policy which they have inaugurated.
We often speak of (the government's policy, and the same line of argument is followed as that made use of last week by the hon. member for St. Lawrence-St. George. If we look over the speeches delivered in the past by the leaders of the Liberal party, by the Right Hon. Mr. Fielding when he was Minister of Finance in the Laurier cabinet, we notice that tlhe policy of the Liberal party has always been to maintain a certain stability in tariff matters, and that the party never disturbed this stability but carried on the policy inaugurated in 1878, the National Policy.
But, Sir, if we examine the tariffs which were established at that time, the truth is seen. We notice that, in all circumstances, the Liberal party endeavoured to lower in a moderate way the tariffs, nevertheless allowing a protection, which I might call "in-


Arthur Meighen: (Translation):	May I
ask the hon. member a question?


Joseph Philippe Baby Casgrain: Certainly.


Arthur Meighen: (Translation):	Do you
repudiate the statement of the hon. Minister 120
of the Interior that this budget is the death knell of protection?


Joseph Philippe Baby Casgrain: No; I do not think that, when the hon. Minister of the Interior stated that , the budget was the death knell of protection or the "whisper of death" of protection, I do not think that it was what he meant, I do not believe that in this country, in the province of Quebec which I represent and in the party that sits on your right. Sir, there can be found a majority ready to abolish all protection; I do not think, as I stated at the outset of my remarks, that such was the intention and the thought of the hon. Minister of the Interior. Moreover, I do not think that a political party can be tied down by such a statement, I do not believe that the members of the province of Quebec can be tied down by the statement of one man which was made under such circumstances.


Some hon. MEMBERS:: Hear, hear!
(At six o'clock the House took recess.)
After Recess


Joseph Philippe Baby Casgrain: I was saying Sir, when the House took recess at 6 o'clock, that you could not tie down the policy of a whole party and all those who support the government by a few words which, during the heat of a debate, might have been uttered by one of its ministers, or by persons well up in the party I also added that I did not think there was room, to-day, either in the province of Quebec or in the whole of Canada, for free trade, and that, under no consideration, the party to which I have the honour to belong would ever do anything of a nature to destroy or ruin the industries which, for a number of years, have largely contributed to the prosperity of our country.
The government, in the budget which it has just introduced, has adopted the Liberal policy as it was prepared and handed down, by the leaders who preceded us, by the late Sir Wilfrid Laurier and those, who before him, had the destinies of the Liberal party in their hands.	.
In the course of the speech of the hon. member (Mr. Hocken) who preceded me, I was astonished at some of his remarks. He stated that the Canadian workmen were emigrating in great numbers from large centres to the United States and he bewailed very much the treatment which was meted out to them in the new budget.

The Budget-Mr. Casgrain

I think the same remark was made by the ex-Minister of Finance (Sir Henry Drayton) at the outset of this debate. They are, today, very anxious over the lot of the working class, especially over the lot of the tillers of the land. However, they had not, it seems such great concern in past years when, in 1911, the government of Sir Wilfrid Laurier submitted to the people for approval the reciprocity pact which would have benefited all Canadians. With reciprocity, the whole country would have progressed, and we would not have to brood over this disquieting state of affairs that these gentlemen of the opposition, to-day, are so much fretting about.
Let us now examine what the Conservative party has done for the farming, class. If we go back to the year 1920, when the government of those who sit on your left, Sir, had appointed a commission to inquire as to changes in the tariff which it would be necessary to effect, we shall see that the farmers requested, at that time, in Quebec, from the commission presided over by Sir Henry Drayton, a lowering of duties on farm implements. The farmers foresaw, then, that profits might dwindle down, that there would be a crisis to tide over and they wanted to prepare to face it. They had been careful to request the government to adopt the necessary measures to guard against periods of hard times which might intervene and be detrimental to their interests. But the Conservatives declined to rescue them and dismissed their just claims, with the results that we now know.
The hon. member who preceded me in this debate also stated that the Liberal party was not faithful to its pledges, that it was not the old Liberal party that carried on the policy of Laurier and Fielding. But, Sir, is it not a cause for regret to see those who insist, to-day, that we should take up the policy of Laurier and Fielding, were the first, during the years when the government of Sir Wilfrid Laurier presented its budgets, to oppose them and prevent the enactment of the Liberal's budget policy which is so highly praised to-day and which is said to be the best? Are they not the same gentlemen who, in the year 1911, carried on the whole campaign against the late Sir Wilfrid Laurier to prevent the enactment of that policy known as the "Laurier-Fielding tariff policy?"
The hon. member for West Toronto, Sir, is fretting for the future of the steel industry which, he states, will suffer great losses through the lowering of the tariff on farm implements. If we consult for a moment the statistics, we shall notice that the company known as the Steel Company of Canada,

which my hon. friend mentioned, is making large profits. For the year 1921 their profits amounted to $810,292, in 1922, they were $903,596, and in 1923, they amounted to $1,432,875. So that, during the last three years, this company increased its profits from year to year, to such an extent that, to-day, the small setback which it might have to suffer would be greatly compensated by the profits it has accumulated in the past.
If we listen to the remarks which are made by the hon.. members who sit on your left, Sir, we gather the impression that they are great alarmists and pessimists. On the other hand, if we read the financial newspapers, we find that we have no such cause for alarm and fear for the future. I was looking over, not long ago, a journal that has a certain influence in Montreal, the Montreal Financial Times, dated April 11, 1924 and this is the heading I found:
Twenty-Seven Companies Have Reported Increased Net Profits During Past Year
Over 50 Per cent of Corporations Whose Annual Reports Have Appeared in Last Few Months Indicate Increase income Available for Dividends- Showing Practically the same as Year Ago-Some interesting Earnings Changes Revealed-Two Successive Years of Progress.
Evidently, Sir, one should hear both sides of a question. Some hon. members state in this House that business is bad, that industries are threatened with ruin, that no alteration should be made to the tariff; on the other hand, these same gentlemen carry on a propaganda in their newspapers 'and assert that business is improving and that the financial situation of the country seems brighter from day to day.
And the editorial continues:
It is gratifying to note that in the majority of cases, substantial progress has been recorded in the matter of earnings. In a compilation showing respective net incomes available for preferred and common dividends for the fiscal years ended in 1923, 1922 and 1921, comprising 48 companies, it is interesting to note that no less than 27 companies reported increased net income in 1923 6ver 1922, which in itself was a year of fair progress. In that year 28 out of 48 companies had net incomes registering increases over 1921.
Fifty Per Cent Increase
This showing is extremely interesting inasmuch as it indicates that progress during the past two years has been along comparatively stable lines despite the vicissitudes of general business and the constantly fluctuating influences. The past two have undoubtedly been years of comparative hardship, and industrial betterment has been confined to a large extent to specific lines. At the same time the fact that approximately 50 per cent of the companies listed in each of two years have been able to make headway speaks well for the position in which industrial and commercial companies to-day find themselves.
I also came across in the same journal, a few weeks lateT, another editorial headed' thus:

The Budget-Mr. Casgram
Seven Canadian Industrial Groups Earn $32,760,410 Per Annum in Over 5 Years Period
These are excellent results and there is no fear that such large and powerful corporations will really suffer to-day, by the small changes we are making to the tariff as regards farm implements. My hon. friend from St. John and Iberville (Mr. Benoit) who is in the business and is thoroughly acquainted with the farming class, inquires whether the farmers have earned as much as that. I think the answer is an easy one. I do not know that any farmer has ever existed who accumulated such large profits.
The editorial further states:
While industrial prosperity is still a rather elusive factor it is gratifying to learn that since the end of the war leading industries of the Dominion have had their fair share of whatever was possible in the way of profits.
The editorial further divides the companies into various groups: Heavy Manufacturing, Miscellaneous Manufacturing, Cottons and Textiles, Pulp and Paper, Public Utilities, Flour Milling, Mining and Development, and shows exactly the results obtained and the profits earned during the last five years:
Five-Years' Average of Common Capital and Earnings
Common	Net	P.C.Capitalization	Earnings	EarnedHeavy Manufacturing. Miscellaneous Manu-	$106,399,000	$3,853,371	3.62facturing	21,265,280	1.957.524	9.41Cottons and Textiles	14.616.100	2.927,732	20.03Pulp & Paper.. ..	57,128,280	7,844,326	13.67Public Utilities.. ..	121,849,973	8,908,753	7.23Flour Milling	
Mining and Develop-	11,992,008	2,180,483	18.09ment	39.633,700	5.088,251	12.84Total of 5-yr. averages	$372,884,346	$32,760,440	8.79
There is still another basis and criterion: the market price of certain shares of these corporations. In the remarks that I am addressing this evening to the House, I wish it to be well understood that I am trying in no way to deny the usefulness of these corporations and that I am ready to recognize all the work they may have done for the development of our country and the expansion of our commercial centres. Only, it is but right to observe that all these corporations have made enormous profits which are not to be compared in any way with the farm profits.
This journal then takes up the cotton industry ; it says, referring to the Dominion Textile Company:
On March 31, 1922, net assets applicable to the old common stock amounted to $10,007,701, or $200.15 per share of $100 par value, or approximately $66.75 per present no par share.
And regarding the Canadian Cotton Company:
On March 31, 1923, net assets applicable to the common stock amounted to $5,522,145, or $203.36 per 6hare of $100 par value.
My hon. friend from St. John and Iberville inquires whether there is "watered stock", whether these companies have been over-capitalized. I am not in a position to answer, I am not prepared to give these facts to the House and supply the necessary evidence in that connection, but I only wish to quote the facts which were published in the press throughout the country and show up the satisfactory financial situation of these large corporations.
That is not all, we read in the same journal, that business is in excellent shape and besides is on the increase in the Western provinces.
In a despatch forwarded from Edmonton, Alberta, we find this extract:
Banks and loan companies are more satisfied with the outlook than they have been in several years. Alberta's productive wealth has been greatly increased and saner methods are in evidence in every department including the agricultural. Collections have been well sustained although they have not been sensational.
And a number of companies which, in past years, had not been able to pay to their shareholders substantial dividends, were lately able to do so. We have the Goodwins Ltd. Co. of Montreal, who gave out that it was paying all arrears of dividends on its stock "Goodwins Ltd pay all arrears on its stock," and all this is to be found in the same financial journals which on the other hand, try to impart to the public that business is bad and that we are passing through, to-day, a period of depression. If we examine the commercial sheets and consult the business people, we find that in a great number of cases they are not so pessimistic as our friends who sit, Sir, immediately on your left.
I have before me a circular from one of the largest firms of brokers of the city of Montreal-and we receive many of this kind of circulars.
This document is dated April 11, 1924, after the budget had been presented to the House and thereby made known throughout the country.
At the beginning of the second quarter, we have advanced sufficiently far into 1924 to get some line on the probable outlook for the remainder of the year. One thing that seems assured is that it will be a year of easy money conditions, so that with plentiful funds available for investment there is likely to be a steady demand for high grade bonds and stocks, etc.
And they refer to large industrial corporations and companies in which they encourage the public to make investments and place their savings, because they state, business being on the mend the profits will be larger. There is also another test; we often take advice
The Budget-Mr. Casgrain

from economists and it is well to inquire at that source so as to learn from these persons who are continuously in touch with these questions, what is the financial situation and if it is improving. Here is the opinion of Mr. Roger W. Babson, a distinguished economist, who publishes statistics and reports on all financial questions; speaking of the financial situation in Canada, he goes over the ground thoroughly and says, among other things:
The Situation in Canada is Improving
Roger W. Babson has published of late, on the present conditions of business in Canada, an interesting review in which he states, among other things, what follows:
" The close trade relations between Canada and the United States, says Babson, are not appreciated to their full value by the business people of both countries. In the matter of economic relations the boundary counts for very little. The different (Conditions existing in those two countries arise especially from a different equilibrium between the manufacturing and agricultural industries. The manufacturing centres are the first to react from an economic depression ; business flourishes many months before the productive regions of raw material. Although manufacturing industry is rapidly developing in Canada, this country is still looked upon as producing raw material. Thus, it is always later than the United States in its movements of fall and rise. That is why the Canadians can look upon the economic situation existing in the United States like a barometer pointing out what will take place in Canada a little later."
" Up to now the readjustment has been somewhat slow in the provinces, but it may become more noticeable during the year.
This proportion will improve, and not only will business transactions increase, but work will be distributed in a more general way throughout Canada. At present the advertising and sale must produce the best results in the eastern provinces. The industrial situation should continue to improve in 1924."
So that, Mr. Speaker, you may judge that all the members who sit nearest to your left and the press of the country, especially the influential English press, which has endeavoured to tell us that industries are in danger, that trade is fading and that the time is ill chosen to bring on the few changes to the tariff by which we are trying to improve the conditions of the farming class, all these gentlemen, I say, are not entiiely right, for we know, on ihe other hand, from people absolutely disinterested, that business is looking up, and that the financial situation is improving from day to day.
In the budget which is, at present, under consideration we note-a remarkable thing- that there are less taxes than might have been expected, when the government faced with numerous difficulties, might have been forced to enact further taxation or at least maintain those taxes which were already in existence. The slight changes that have taken place are not of a nature to bring on the

imaginary unrest that some endeavour to flash in the eyes of wrongly informed people. Pessimism is one of the causes of the straitened circumstances in which the country finds itself at present. By means of advertisements and newspaper editorials an effort is made to convince the working class and the business people that all is going wrong. That is why I ask all the members who have at least the interests of the middle class, the farming class and the working class, and who share the views expressed in the budget as brought down by the Acting Minister of Finance, to rise in this House so as to explain to the country their position and convince the people who might, perhaps, be badly informed, that the situation is not so critical as it is made out to be in certain quarters, and that the budget brought down by the government of the Right .Hon. W. L. Mackenzie King is a budget which reaches all classes of society but especially the farming class.
The depression which took place in the farming industry, is due to the fact that the government which preceded us paid no attention to the just claims of the farming class, and, consequently, did not endeavour, immediately after the war, to distribute more equitably the taxes and reduce them if possible. Wrongly did we abandon the farmer to his own resources although he had practically no more market in which to sell his products. The enormous expenses brought on by our exaggerated participation in the European conflict and the heavy taxation which the Dominion government had to have recourse to, was another cause of unrest. The Bankruptcy Act enacted by the late administration and which, up to the present, is highly depressing, is again another cause. We amended it last year. I am glad to hear that it has given better results and that bankruptcies were not as numerous as in the past, in farming districts.
I feel confident that under the administration of the hon. Minister of Justice, the member for Quebec East (Mr. Lapointe), new amendments will be added to the act and will have for effect to dispel the unrest which the farming class have to face.
We must congratulate, Sir, the King government, seeing the difficulties to which the farming class is exposed, for having acquiesced in the just claims of the farmers, the country people who, after all, make up the greatest part of Canada's population.
Now, I do not wish to be charged with bringing up local questions, however, I think it would be proper to draw the attention of the government to an industry which, in my

county and elsewhere, has become important and deserves to be better encouraged by the government. It is the maple sugar industry. It is stated that the last crop brought $5,500,000 to the farmers of the provice of Quebec, and there is no doubt, according to information which I have gathered, that should the government help this industry, to a certain extent, the farmers could still more increase this output, and that this branch of the farming industry would become more productive and give better results. The surest way would be, perhaps, to help the farmers as it was done in the past for the dairy industry. I trust that the Minister of Agriculture will find means of doing something in that line for the farming class.
We notice in the budget that is now under consideration and also in the policy which the government has proclaimed and put into force since we have assumed power, that it has always endeavoured not to go to extremes neither on the side of free trade nor on the side of protection, but has always tried to establish a moderate policy, that is has always steered the middle course, -which is the one we should adopt in a country like Canada, where there exists various opinions in all classes of society, also marked differences owing to geographical conditions which are very exceptional. I wish to add a few words with regard to the British preference. I am not an expert on the subject of trade and I have not a knowledge of all the results of this policy; but from what I hear through a number of tradesmen and manufacturers, this policy, when it was adopted, could to a certain extent have given good results; but to-day it may not be satisfactory, and may be of a nature to prejudice certain industries. I hope that the government, while considering this question, will take care of the industries which in the province of Quebec, might suffer from such a policy.
We have read, Sir, in the press throughout the country, on more than one occasion, that the provinces of Quebec and Ontario should unite with the view of giving the country a better bearing, a policy aiming at furthering the interests of Canada. It has been stated that the two oldest provinces of confederation should unite to carry high the torch of progress so as to enlighten the other provinces. Nevertheless, let me say that if we had not at our sides the other provinces of confederation to attain our end, I fear that we would not succeed. I think that the present policy of the government is broad enough and sufficiently attractive for all our provinces. What the country needs to-day, to my mind, is not class legislation or legislation favouring
The Budget-Mr. Casgrain
certain districts or provinces, but a government for all classes of society, that will endeavour as much as possible to promote the interests of all citizens, farmers, manufacturers, tradesmen and labourers. And the policy which the government proclaims takes in all the interests of the farming class as well as those of all other classes of society.
Before closing my remarks I must not forget the question of immigration which may have given the government many anxious moments, on its assuming power. Under the wise and just administration of the non. Minister of Immigration, pro tern Minister of Finance, the member for Chateauguay and Huntingdon (Mr. Robb), immigration will push ahead, I have no doubt. I am aware that the means which have been adopted will bring to this country a great number of immigrants gathered from the four corners of the globe and that they will be settled as much as possible on farms. We need people to help in tilling the soil and also, perhaps, others to live in the large centres and help in carrying the burden of taxation which still weighs on our people. However, we must not forget that we shall have to select the immigrants and give preference to those who are most able to adapt themselves to the conditions of the country and become good Canadian citizens. What strikes me most in the government's policy is that it tends to furthering the interests of all classes and keep our people at home. To reach this end, it gave its first thought, its first help to the farming class.
I think that we must congratulate the government for having succeeded, during its three years in office in obtaining such good results and having been able, notwithstanding the hard times we are passing through, to balance the budget, reduce the taxes and improve the general situation over the whole country. I further wish to congratulate it for having acquiesced in the just claims of my hon. friend for Chambly and Vercheres (Mr. Archambault) and having brought relief to the heads of family burdened with taxes, by raising the exemption for children from $300 to $500. This is of a nature to help all classes of society throughout the country but especially in the province of Quebec, where there are so many large families. I notice, Sir, that the government is doing well, notwithstanding all the false prophets and all those who insist that its policy is not a good one. All the governments are more or less forced to give way to the just and popular claims, and, we must return thanks to the Prime Minister

The Budget-Mr. Casgrain
and acknowledge that he has endowed the country wdth the best policy, the one which is in the interest of the whole country.
Allow me, Sir, in closing my remarks, to remind the House of the few lines from a poem which characterizes exactly the policy that the government has adopted and tersely describes the wise course of its administration during its three yearn' occupancy.
Remettez en hoimeur 'le soc et la charrue,
Repeuiplez la campagne aux depens de la rue,
Grevez de taxes le riche et degrevez les champs,
Ayez moins de bourgeois et plus de paysans.


Mr. W. C. GOOD (Brant):: During the
course of the present debate, Mr. Speaker, and during the course of the debate on the Address in reply to the Speech from the Throne, the fiscal policy of Canada has been discussed from almost every conceivable angle, and I should not feel justified in now participating if I had merely to repeat and reaffirm those professions of . faith and opinion that have been so well and so frequently made in this House; but I propose to break somewhat new ground this evening, and that is the sole reason why I ask the indulgence and patience of hon. members.
Two years ago when I spoke in the budget debate I reviewed the whole argument in favour of protective tariffs and I referred briefly to what might be called the fundamental principles of taxation. On the present occasion, Mr. Speaker, I purpose to deal somewhat fully with the latter part of the remarks which I then addressed to the House, namely, the general question of taxation, its principles and practice, and with special reference to the taxation of land-values.
First, however, I venture to make a few brief observations on the amendment and pn the budget itself. I think it is unfortunate that the wording of the amendment lends itself to differing interpretations. Some hold it to be a substitute motion involving a rejection of the proposals for tariff and taxation relief already brought down by the government and a direct vote of want of confidence. Personally, I am satisfied and assured that the mover had no such intention; the preamble of the amendment makes this abundantly plain. It seems to me it would 'be desirable that the House should permit such alteration of the wording as would make the meaning perfectly clear, but I do not suppose this would be permitted now. Therefore I prefer to vote for the obvious intention of the amendment, rather than reject it on technical grounds. I regard it as supplementary to,-and not as a substitute for, the proposals contained in the budget.

The whole situation, Mr. Speaker- especially * the plight of the 'Conservative party, which is very much the same as oqr own plight two years ago-gives renewed emphasis to the demand which we then made, inferentially at least, for an amendment' to the rules of the House. The rules were devised under the two-party system. Political conditions have altered fundamentally since these rules were framed, and I think it is absurd to try to apply rules devised for one situation to a situation so conspicuously and so definitely different; and therefore I would suggest that we face the question of amending the rules of the House at a very early date. Otherwise I fear we may have a repetition of the ancient story of the new wine bursting the old wine skins. In this connection I was rather impressed by an article that I read recently dealing with this very matter. It is from the pen of one of England's women members of parliament, Miss Dorothy Jewson, and I should like to read a few excerpts' for the benefit of the House. She writes:
A big national assembly must have rules and forms and ceremonies and to take all symbolism and pageantry and colour out of life would be to make it dull and bare, but the Houses of Parliament are overloaded with a heritage of tradition and precedent and archaic customs that fritter away valuable time and energy, cause immense delay, and clog the wheels of progress. The discriminating use of some sort of axe is needed. Instead of being masters of the parliamentary machine we are in danger of becoming its slaves.
How many men have come to the House of Commons, not only full of enthusiasm and animated by high ideals, but with a definite intention and the determination to get something done, to find themselves up against a huge, rusty machine that, when it is not standing still or going backwards, moves with ponderous slowness, causing impatience and bitter disappointment, and provoking members to rebellion, or reducing them to despair, or making them merely cynical.
Further on she says:
Leisurely and picturesque parliamentary methods would not matter so much if the nation were in a better condition instead of the desperate state in which it now finds itself. Certain reforms, essential to an even comparatively low level of civilization, are long overdue* and the fact that they have not been achieved is a condemnation of the way in which our national affairs have been conducted. Only a fraction of the resolution, energy, promptitude and money that were forthcoming during the war could be made the means of transforming large numbers of lives that are now almost everything that they should not be.
I submit that these remarks have a very direct application to the situation here in Canada. I am under the impression-I speak, of course, subject to correction-that the limitations under which we are operating are perhaps greater than those existing in the Old Land.
In regard to the budget, one has to confess a series of surprises. I must admit frankly

The Budget-Mr. Good
at the outset that I was surprised1 and pleased at the extent of the tariff reductions announced in the statement of the Acting Minister of Finance (Mr.'- Robb). At the same time I was disappointed that the range over which these reductions were made was not wider, and that is my chief criticism of the proposals brought down. But a short time after the proposals were originally made, and when I felt justified in supporting them, I was astonished and dismayed to find1 that a regulation had been passed, two days prior to the announcement of the budget, which, so far as I could make out, nullified very effectively the remedial measures that had been proposed; and I was wondering whether I could under those conditions support the budget. However, I am very glad to say that a day or two ago the Minister of Customs (Mr. Bureau) announced in this House the withdrawal of that recent amendment to the regulations, and therefore I feel again justified in supporting the budget proposals. I would like to suggest, however, in passing, that the whole administration of the Dumping Act has a sinister aspect-I would like to emphasize that word "sinister," and I hope I give no offence. It needs a thorough overhauling, and unless the government will do something in that connection I prophesy trouble. .
Returning to the main topic, that is, the question of taxation, I do not think it should be necessary in this House to stress its political importance. History, indeed, is replete with examples. The rebellion of the ten tribes of Israel "under Rehoboam was due to crushing and onerous taxation. The history of the Roman Empire will show that the strength of that great political organization was sapped by iniquitous taxation methods. In England during the seventeenth century we find a great civil war arising at the time of Charles I, due almost entirely, I think, to arbitrary taxation. Later on we have the American war of independence in the eighteenth century, also emphasizing and based upon the unfairness of taxation without representation. The French revolution, following shortly afterwards, was another instance of the same sort, again emphasizing the political importance of this question of taxation. I would submit, Mr. Speaker, that the present farmers' movement in Canada, which is represented in this House by over sixty members is one of the most modern protests against unfair and unjust taxation; and even now, from coast to coast, an emphatic protest is being made against unjust taxation. To sum up the importance of this subject I
submit a very significant statement made by Professor Richard T. Ely, of the University of Wisconsin, in his book Taxation in American States and Cities. It is as follows:
Taxation may create monopolies, or it may prevent them; it may diffuse wealth, or it may concentrate it; it may promote liberty and equality of rights, or it may tend to the establishment of tyranny and despotism ; it may be used to bring about reforms, or it may be so laid as to aggravate existing grievances and foster hatred and dissension among classes; taxation may be so controlled by the skilful hand as to give free scope to every opportunity for the creation of wealth or for the advancement of all true interests of states and cities, or it may be so shaped by ignoramuses as to place a dead weight on a community in the race for industrial supremacy.
Further, Mr. Speaker, I think we may say that the teaching of all history, particularly that of the English-speaking peoples, leaves with us this lesson; that the power of taxation must be retained by the people, either directly or through their representatives. We have claimed that right here in this House, and the British House of Commons claims it. We have gone even further in connection with our municipal governments, where money by-laws are subject to the obligatory referendum.	.	,
Now, I made certain observations during the debate on the Address respecting unsound methods of taxation, and the Minister of Railways and Canals (Mr. Graham) was good enough to ask me, on that point, whether there were any sound methods of taxation, or whether the people would admit that any methods of taxation were sound. I replied that at all events some methods were sounder than others, and I proceed now to elaborate that thought.
First, I think we shall have to define our terms, and I ask the question, what is taxation?' In olden times, if we consider the feudal structure of society, the taxation then existing really had the purpose and effect of giving the individual serf or peasant, protection of life and property under his lord. The system was abused only as and to the extent that, the lord or king taxed for petty or personal causes. Leaving that condition of society and coming to what we may call modern democratic institutions and organizations, what shall we say as to taxes? I submit that the following may be a fairly satisfactory definition:	Taxes are payments by
the individual to the community for the protection of life and property and for the carrying on of collective activities. In other words, taxes are payments by the individual to the community in return for services rendered the individual by the community. Let me take some exampies in order to illustrate my point a little more fully.
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Take the rural municipalities in this country. We have there for instance, certain common or collective activities that are carried on such as schools and the maintenance of roads, bridges, and things of that sort. Then take our urban municipalities where we have the same collective activities carried on and in addition such enterprises as police and fire protection, water, electric and sewage services, health, recreation and so on; and as these communities develop we find a growth in the variety and importance of these collective activities. Then in our Canadian provinces we have further collective activities that are carried on, such as the administration of law, the support of education, the maintenance of some roads, the care of unfortunates, and so on. And so far as our Dominion is concerned, we have only to look over the estimates to see the variety and extent of the services which as a Dominion we perform for individuals in Canada and for which we exact taxes from individuals in Canada.
I submit, Mr. Speaker, that if these services are necessary and desirable, and if there is efficiency in the administration or in the execution or carrying out of these services, there is no cause for complaint against the aggregate amount of taxation. That is a comment I would like to make on many speeches that have been made in this House. It goes without saying, of course, that we can afford to provide the services: that I think must be taken for granted; and in such cases the presumption is we would not undertake these services collectively if we could get better results by individual action. For instance, unless we can educate our children better by operating collectively in the establishment and carrying on of our schools, we would not do so; we would do as was done in former times, have each family educate its own children. I take it, Mr. Speaker, that the scope of our collective activities is constantly widening, and that that must be so in the case of a developing civilization. Therefore, the aggregate of taxation is likely to grow. I do not think there is anything regrettable or objectionable in this. I wish, however, to submit this thought to the House, that these various collective activities which are now paid for by taxation may be carried on under other auspices than state auspices. We find, for instance, in many cases that they are being carried on by voluntary, co-operative organizations, and it is quite possible we may have what has been called the fading state as civilization develops, where more and more of the activities which are now carried on under state auspices, where coercion exists, where taxes are enforced, shall be carried on 
by voluntary co-operative organizations under entirely different psychological conditions, at all events. But the tendency in that direction is not apparent at the present time; in fact, there has been in recent years, in many countries at least, a tendency towards the enlargement of collective activities under state auspicies. My own feeling, however, is that ultimately there will be a turning of the tide and that it will seem better that many of these activities should be conducted by voluntary co-operative organizations rather than under state auspices.
Now taxation is not only payment for present services, but also for past debts, which I presume may be taken to represent services rendered to the individuals of the past. This is particularly the case in all wars, and I was very much interested, as I think the House was, in getting the information submitted the other day by the hon. member for West Calgary (Mr. Shaw) which showed conclusively that practically all national debts were incurred only during wars and for war purposes.
I should like to read in that connection some remarks made by Professor Irving Fisher recently in a pamphlet entitled "Europe's Big Debt." This is something that we should take to heart. I quote:
The greatest economic problems before the world to-day are those growing out of the big war debts and post-war debts. These debts constitute one of the two millstones around the neck of Europe. The other millstone is that of armaments. Under the weight of these two millstones, much of Europe is sinking into chaos.
Further on he says:
The common notion that the present misery of Europe is directly due to the war, and so was unavoidable, is erroneous. That misery is due to certain by-products of the war-especially militarism, debts, and inflation-which were very largely preventable.
To understand this we must first disabuse our minds of the common impression that in paying these debts " the world is. paying for the war." The truth is the war cost has already been paid for. It was paid for during the war itself when the shells were exploded, when the soldiers' clothes were worn out, when their food was eaten. The debts that are now left merely mean, that, during the war, some people paid more than other people, so that now the latter, are asked to reimburse the former. That is, the taxpayer is asked to reimburse the bond-holder. The world as a whole not only pays but receives. It distributes from one set of pockets to another.
War unfortunately, Mr. Speaker, furnishes a splendid opportunity for money makers and money lenders to fasten chains upon their victims more tightly and to lay the masses of the people under tribute. I think if the methods whereby war debts are 9 p.m. piled up were well known and analyzed, the widespread repudiation now going on would be more intelligible. But we are not repudiating, at least as yet:

The Budget-Mr. Good
in fact, we have vastly increased our war debt through deflation. I would like to suggest to the House that members should read in that connection a recent work written by John Maynard Keynes on Monetary Reform, which deals exhaustively with that question. Possibly there should be some repudiation of debt; possibly there will have to be in the future. But, Mr. Speaker, it is difficult to discriminate with justice. We cannot tell as yet what is going to happen, but I want to submit to the House as did the hon. member for West Calgary the other day, that this question of our debt has not yet received any serious consideration by the Canadian people, and I think it ought to. I should like to read in that connection some extracts from this book by J. M. Keynes. He says.
There is a respectable and influential body of opinion which repudiating with vehemence the adoption of either expedient-
He is referring there to what are known as the capital levy and devaluation.
-fulminates alike against Devaluation and Levies, on the ground that they infringe the untouchable sacredness of contract; or rather of vested interest, for an alteration of the legal tender and the imposition of a tax on property are neither of them in the least illegal or even contrary to precedent. Yet such persons, by overlooking one of the greatest of all social principles, namely, the fundamental distinction between the right of the individual to repudiate contract and the right of the state to control vested interest, are the worst enemies of what they seek to preserve. For nothing can preserve the integrity of contract between individuals except a discretionary authority in the state to revise what has become intolerable. The powers of uninterrupted usury are too great. If the accretions of vested interest were to grow without mitigation for many generations half of the population would be no better than slaves to the other half. Nor can the fact that in time of war it is easier for the state to borrow than to tax, be allowed permanently to enslave the taxpayer to the bondholder. Those who insist that in these matters the state is in exactly the same position as the individual, will, if they have their way, render impossible the continuance of an individualist society which depends for its existence on moderation.
I should like to read further in that connection, but I forbear, as the time is passing. This matter, indeed, Mr. Speaker, is somewhat outside the immediate subject for discussion this evening, and therefore I sum up thus:	Taxes constitute payment for services rendered.
The analysis which I propose to give further differs somewhat from that given by Professor Henry C. Adams in the Science of Finance; but it covers practically the same facts and is I think a little more applicable to our existing situation. I refer to his book in passing as dealing in an exhaustive way with the whole question of public finance. I propose therefore to examine and classify the different kinds of taxation that we find existing at the present time.
My first classification is that of direct and indirect taxation. Politicians are very fond of saying that people will not stand for direct taxation. I would like to submit to the House that no enlightened people will stand for indirect taxation, and I emphasize the point that, other things being equal, direct taxation is always preferable to indirect taxation. I want to issue that challenge to the country, to the House and to those politicians who are fond of saying to the people, for purposes which it is not hard to discern, "Now, of course you will not stand for or endure direct taxation". I say that direct taxation is always preferable to indirect taxation because it is honest and above board, less easily shifted or -evaded, and the taxpayer knows what he is paying, and therefore he will be very vigilant to see that he gets his money's worth.
My second classification is on a different basis and is as follows:	First, taxes on consumption, for example tariffs and sales taxes. These may be either direct or indirect. Let us take for an example the case of the average man with a large family. He necessarily bears the largest share qf taxation on consumption; and I would submit, Mr. Speaker, that he renders the greatest services to society in the matter of raising his family. In fact I have often heard it said that every child that is brought up to a state of manhood or womanhood is worth a thousand dollars to the state. I do not know whether that figure is accurate or not. It may be much too small. At all events it expresses the obligation the state is under to the individual in this connection; and yet taxes on consumption place the burden on those who render service to the state, and in proportion to the services which they render. I submit, Mr. Speaker, that such a tax is absolutely indefensible. I should like in that connection also to refer briefly to two cases which I mentioned two years ago; first that of a rich mine owner who, by reason of the fact that the state guarantees to him peaceable possession of his property, is in the receipt of, say one hundred thousand dollars a year, for which he makes no effort whatever. Contrast his situation with the situation in which one of the miners is placed, say with a family of five, and in the receipt, we shall suppose, of five dollars a day. Now, Mr. Speaker, there is a contrast worth dwelling upon in connection with our consideration of taxes on consumption. The other case that I referred to two years ago was that of the Canadian Pacific Railway western lands, increasing in value every year by reason of the
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labour of neighbouring settlers. The railway company which has title to these lands is in receipt of a large amount, has indeed a large claim upon the services and commodities which society produces without rendering any services in return, whereas the poor settler in the neighbourhood pays heavy customs and sales taxes on all his supplies. Here again is a case where the rich idler is exempt or nearly so, and the poor worker has to bear the brunt of the burden. I think there is no tax so utterly indefensible as the tax on consumption. The only thing that makes it tolerable, or the only ostensible and nominal justification for it is in the case of commodities which are needless or harmful in use. Now it is difficult to find such commodities, for this reason, that what is useless or harmful to one person is often useful and necessary to another. Perhaps we might specify such a commodity as alcoholic beverages, which we might very sensibly subject to a consumption tax; but in regard to most of those things which we call luxuries, I think it will be difficult to justify even a consumption tax; although if we are to retain any taxes on consumption, the distinction which is made for convenience, and somewhat illogically, between necessaries and luxuries, ought to be retained. I am prepared to admit the propriety of a tax on luxuries if we can decide with satisfaction to ourselves, what luxuries are. On the whole, however, taxes on consumption are unwise and unjust and ought to be abolished.
Secondly, I mention taxes on incomes, inheritances and profits, whether such are graduated or otherwise.	These taxes are
usually justified on the ground of "ability to pay", a principle which I shall shortly examine.
Thirdly, we have taxes by monetary inflation, whether that inflation is carried out by governments or by other agencies. This unfortunately is not generally recognized as a method of taxation, but it is a very important method of taxation and resorted to very frequently. When a government inflates the money volume with its own promises to pay, it thereby decreases the purchasing power of the money already in the hands of its citizens. Therefore, it taxes them to that extent. I should like to read in this connection another extract from this book on Monetary Reform by John Maynard Keynes. I quote:
A government can live for a long time, even the German government or the Ru3sia:i government, by printing paper money. That is to say, it can by this means secure the command over real resources-resources just as real as those obtained by taxation. The method is condemned, but its efficacy, up to a point, must be admitted. A government can live by 
this means when it can live by no other. It is the form of taxation which the public find hardest to evade and even the weakest government can enforce, when it can enforce nothing else.
Further on in his book I quote again:
It is common to speak as though, when a government pays its way by inflation, the people of the country avoid taxation. We have seen that this is not so. What is raised by printing notes is just as much taken from the public as is a beer-duty or an income tax. What a government spends the public pay for. There is no such thing as an uncovered deficit. But in some countries it seems possible to please and content the public, for a time at least, by giving them, in return for the taxes they pay, finely engraved acknowledgements on watermarked paper. The income tax receipts, which we in England receive from the Surveyor, we throw into the waste paper basket; in Germany they call them bank notes and put them into their pocketBooks; in France they are termed " rentes " and are locked up in the family safe.
It would be a good thing for our people generally if they would use some discrimination, insight and discernment in respect to this matter.


Mr. WOODSWORTH:: Who were the
beneficiaries of the deflation jwhich took place in Canada? Did	the government
benefit?


William Charles Good: If the hon. member for
Centre Winnipeg will wait just a moment, I propose to deal briefly with that subject, and I will try to answer his question when I come to it. Inflation is not always brought about by governments. Banks also inflate the money volume and thus bring about taxation. I should like to read in that connection just one sentence from John Maynard Keynes and also an extract from a speech by Professor Adam Shortt. This is the sentence from Mr. Keynes' book.
The internal price level is mainly determined by the amount of credit created by the banks, chiefly the Big Five.
This has reference, of course, to Great Britain. That is a clear statement of a fact which is not generally recognized and admitted, and a fact which was denied last year in the Banking and Commerce committee by a good many of the Canadian bankers, but which Mr. Keynes, as an economist, and other economists have stated very clearly, namely that the banks, through their expansion and contraction of credit and the consequent alteration of the money volume, influence the price-level.
The reference which I submit from Prof. Adam Shortt is taken from an address which he delivered before the University of Manitoba on May 12, 1919, and is as follows:
The credit expansion came mainly, however, through the advances made by the banks, especially the ad-

The Budget-Mr. Good
vances of credit to the government-largely in anticipation of future loans. Under the suspension of specie payment and taking the banking system as a whole, the indefinite continuance of this process is quite practicable because a credit once granted and poured by the issue of cheques into the general money volume of the country never passes out of the circle until it is retired, usually by conversion into another form, as when the bank advances are paid off by the further government loans. Thus a credit of $5,000,000, granted to the government is merely an entry in the bank s books, and when drawn upon by the government in favour of munition industries, transportation companies, and supply purveyors of all kinds, much of it may not leave the books of the individual bank involving nothing more than debit and credit entries in its ledgers. Even when the parties to whom the credits are transferred, keep their accounts with different banks, the interchange of such credits between the banks, through the clearing house, practically offset each other in the long run. Thus a credit of even $5,000,000, on government account makes little or no drain on the individual bank, and none at all on the general circle of banks, unless it comes to a matter of foreign exchange.
These are very clear statements of the connection between the operation of our banks and the matter of inflation or deflation. I should like to submit that we have had in recent years sufficient evidence of the extraordinary danger and damage which may result from the unregulated, bungling and stupid lack of control or mismanagement in this regard.
Governments and banks also often combine to inflate when the former issue bonds which are paid for by borrowings and not out of savings. Instead of such a procedure it would be just as well, if not better, for the government to print paper money and! thus save the interest. The effect on the price level is identical whichever policy is pursued, and we might just as well, as a people, pursue the more economical policy. In the United States and Canada during the war years we witnessed a tremendous inflation, and a large part of the inflation which was noticed was, no doubt, due to the issuing of bonds and the payment therefor by the extension of credit by the banks, the banks taking the bonds as collateral security. Now inflation is bad enough, but the mischief is made much worse by deflation, and, unfortunately that usually follows. I shall here answer, in part at least, the question which has been asked me by the hon. member for Centre Winnipeg. And I shall read in this connection some remarks by Mr. Keynes. I think this is particularly important for us to take to heart.______I
quote:
In the first place, deflation is not desirable, because it effects, what is always harmful, a change in the existing standard of value, and redistributes wealth in a manner injurious, at the same time, to business and to social stability. Deflation, as we have already seen, involves a transference of wealth from the rest of the
community to the rentier class and to all holders of titles to money; just as inflation involves the opposite.
In particular, it involves a transference from all borrowers, that is to say from traders, manufacturers, and farmers, to lenders, from the active to the inactive, But whilst the oppression of the taxpayer for the enrichment of the rentier is the chief lasting result, there is another, more violent, disturbance during the period of transition. The policy of gradually raising the value of a country's money to (say) 100 per cent above its present value in terms of goods I repeat here the arguments of chapter 1-amounts to giving notice to every merchant and every manufacturer, that for some time to come - his stock and his raw materials will steadily depreciate on his hands, and to everyone who finances his business with borrowed money that he will, sooner or later, lose 100 per cent on his liabilities (since he will have to pay back in .terms of commodities twice as much as he has borrowed). Modern business, being carried on largely with borrowed money, must necessarily be brought to a standstill by such a process.
It will be to the interest of everyone in business to go out of business for the time being; and of everyone who is contemplating expenditure to postpone his orders so long as he can. The wise man will be he who turns his assets into cash, withdrawn from the risks and exertions of activity, and awaits in country retirement the steady appreciation promised him in the value of his cash. A probable expectation of deflation is bad enough; a certain expectation is disastrous. For the mechanism of the modern business world is even less adapted to fluctations in the value of money upwards than it is to fluctuations downwards.
We have seen in Canada, in the United States, and in many other countries a very serious inflation between the years 1916 and 1920 and a very marked and rapid deflation during the succeeding two years. The hon. member for Centre Winnipeg (Mr. Woods-worth) asked who was responsible for that. It is a big contract to answer that question, but in my judgment banks, governments, and a number of parties and institutions were responsible, although it would be difficult to fix the responsibility definitely upon any one group of people. At the same time, while it is difficult to fix this responsibility, it is absolutely certain, that immense damage has been done; and so far as this country is concerned we as legislators have a responsibility in that connection, to prevent a recurrence of this sort of thing in the future. No kind1 of taxation has been more frequently resorted to in recent years than that of altering the purchasing power of money, and nothing has done more harm.
Mr. MACLEAN (York); The hon. member has quoted a number of experts on taxation, and certain suggestions have been submitted. Would a permanent board of experts, men of extensive business experience, always in session, studying the changes that occur from time to time, prove of essential value as an advisory body available to parliament in dealing with these questions with a view to improving the system of taxation?
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William Charles Good: I propose to deal with that
matter definitely at the conclusion of my address, if the hon. member will be good enough to wait until then.
In the fourth place-to resume-I note what the hon. member for North Waterloo (Mr. Euler) has very properly termed "nuisance taxes." We have a variety of trivial imposts, such as stamp taxes, receipt taxes and I know not what, on all kinds of documents, which are a penalty on exchange. These are very similar to the taxes on consumption and there is little if anything to be said in their favour.
In the fifth place, and lastly, we have property taxes. Now, what do we mean by property ? I submit that there are two kinds of property: First, there are those kinds of property which are not the products of labour, such, for example, as unimproved farm land, mineral resources, water powers, timber limits, and so on. Secondly, there is the property which is the product of labour such as wheat, houses, clothing, and so forth. And this distinction is given expression to in the farmers' platform by the phrase "unimproved land values including all natural resources." Briefly stated, therefore, property consists of two kinds, land-values and labour-values, which I think are two very concise terms, describing adequately two different kinds of property. As I shall attempt to show later on, a tax on land-values is a payment for service rendered to the individual by the community; and I submit that there is no other tax which conforms so completely to that principle of payment for service rendered as does the tax on land-values. The tax on labour-values, though it may be to some extent based on the principle of ability to pay, is largely in proportion to what the individual does for the community and not vice versa; in fact, it is very much the same in principle as the tax on consumption, where a man is taxed not in proportion to what he gets from society but in proportion to what he gives to society. And that, I submit, is a most anomalous and questionable procedure, particularly from the standpoint of common morality.
Now, I have surveyed the field of taxation which is familiarly known to us, and the question arises as to what principles are discernible in these various kinds of taxation. There are I submit only two principles discoverable in these systems of taxation that have any show of justice. Only two principles need we study any further, namely, first, taxation according to benefits received, or [Mr. Good.}
service rendered, which is another way of putting. it; and, secondly, taxation according to ability to pay.
The principle of payment for benefits received is that which normally prevails in our business life. If for instance we go into a store to buy a pair of boots or a suit of clothes we do not pay in proportion to the amount of money we have in our pockets. The rich man pays no more than the poor man; every one pays for what he gets. That is the common principle that is accepted everywhere in ordinary commerce. Occasionally, however, this principle is departed from, as for example when a doctor charges a rich patient more than he does a poor one. That however, I submit!, is the exception that proves the rule; and I think the world would be a rather topsy-turvy place if we departed very far from that sound common sense idea, of payment for benefits received. But some departure from the general principle is justifiable. And that leads us to the second principle, of taxation according to ability to pay.
The general argument upon which this principle is defended is based on the proposition that the individual is a social product; that all he has and is are due to social influences and forces; that society owes all to him and he all to society; that there is no real distinction between "mine" and "thine." To put it in brief, as one United States writer has said, the individual is "society at a point." I should like hon. members to retain that phrase in their memories: the individual is "society at a point." They will recall perhaps also some words that are put by Tennyson into the mouth of Ulysses when he says:
I am a part of all that I have met.
This reasoning leads us to the well known motto of the socialist: "From each according to his ability, to each according to his need." It leads to communism, to that condition of society pictured by Edward Bellamy in two or three of his books. I am prepared to admit very frankly that there is a good deal of truth in such reasoning, and as an ultimate ideal it may be impossible to successfully challenge it, I suggest however that it is wise not to push its application too far or too fast. We have a long road to travel yet before we can safely deprive the individual of all rewards of individual effort and sacrifice.
I think that would be safe only when, and as, the motive of rendering service to the public becomes dominant. Of course, it is true that the old and infirm and unfortunate are supported by the able-bodied and enterprising; the strong must bear many burdens for the weak, so that to this extent we oblit-

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erate the distinction between "mine" and "thine." But we do not generally, or at least we should not, give the rewards of labour to the idler. Unfortunately, Mr. Speaker, we often do: unfortunately idleness often eats the bread of industry. But I think we should hesitate to endorse that principle. I think we should hesitate to make no distinction in reward between two farmers side by side on land equally fertile, equally well situated, one of whom is thrifty and industrious and the other extravagant and indolent. Are we prepared to ignore completely the difference between those two individuals and give no recognition to their individual efforts and individual sacrifices? I think not. Gradually I hope and believe the truth of the co-operative motto, "Each for all and all for each," will come apparent; gradually I hope and believe people will learn that the individual serves his own interest best in serving the public interest.
In this connection I have one or two quotations that I shall submit to the House in order to clarify the point. My first quotation is from the Public, an American journal which no doubt hon. members are familiar with, as follows:
The proposal to tax land values to the exclusion of labour values should not be confused with either socialism or communism. It is individualism, pure and simple. It secures to the individual all that he produces as an individual and also his share of the social value that he helps to produce as a member of the community. It involves no new idea of property, no change in land titles, no increase of officials, and no complication of accounts.
The point there is simply this, that the taxation of land values is not socialistic. Whatever truth there may be in socialism would suggest a modification of the taxation of land values. This taxation is strictly individualistic as contrasted with socialistic. I now read a rather humorous letter from an ex-congressman of the United States, written some time ago to an American paper. It deals with this very point, and I think the House will appreciate its humour. It reads:
I wish I felt equal to dictating an entirely profane statement of present conditions and where they are leading.
With the same inevitable tendency that destroyed agricultural production in Russia by taking away peasant initiative, we are destroying every productive enterprise in this country, and need only a few million more bond salesmen, bankers, and rakeoff experts, to reach a millenium where everyone will live on the interest of his debts.
We should go ahead wrecking commerce and destroying cargo by protectionist insanity and then restore the carrying trade by subsidizing vessels to haul bad air from New York to Rio de Janeiro and from San Francisco to Hong Kong. We especially need as a prophecy of prosperity high-priced land upon which to raise cheap foodstuffs and to conduct manufacturing operations. Four or five more agencies between the
production of coal and the man with the chilblains will furnish a competence for millions of our people. We ought to give away our natural resources to philanthropists who will fence them in and who are willing to divide with many unnecessary distributing agencies but not with the producer or consumer.
I sincerely hope you will publish a mean, nasty sheet that will devote itself to drastic criticism and avoid the attempt to provide theoretical Utopias.
I quote also from a speech recently delivered in the United States congress by Congressman Keller of Minnesota. I will refer to his activities later. The following deals with the point under consideration:
But again it may be objected that my land value tax does not conform to the "ability-to-pay" principle of taxation. My answer is that it is a great improvement over this principle. The present ability-to-pay principle of taxation has two very serious defects:
1.	It makes no distinction between incomes that are earned and incomes that are unearned, and
2.	It penalizes the man who properly uses his land and rewards the man who deliberately keeps from using it. In other words, the ability-to-pay principle-or income tax-discourages industry and production and encourages idleness and speculation.
I come to this conclusion, Mr. Speaker, which I submit to the House, that the basic principle of sound taxation is payment for service rendered; that it is logical and necessary, however, that this principle should be modified to a limited extent by that of "ability to pay." Also, I think it goes without saying, a sound system of taxation should be such as cannot easily be evaded and shifted, and whose cost of collection is a minimum. In that connection I would submit to the House the four classic maxims of Adam Smith, as follows:
The best tax by which public revenues can be raised is evidently that which will closest conform to the following conditions:
1.	That it bear as lightly as possible upon production-so as least to check the increase of the general fund from which taxes must be paid and the community maintained.
2. That it be easily and cheaply collected, and fall as directly as may be upon the ultimate payers -so as to take from the people as little as possible in addition to what it yields to the government.
3. That it be certain-so as to give the least opportunity for tyranny or corruption on the part of officials, and the least temptation to lawbreaking and evasion on the part of the taxpayers.
4.	That it bear equally-so as to give no citizen an advantage or put any at a disadvantage as compared with others.
Now, Sir, I ask the House:	What system
or systems best fulfil the above requirements both as to principles and methods? The quotation from Adam Smith deals largely with methods; the arguments that I have been advancing deal mainly with principles. I submit that the taxation of land values, above all other systems of taxation, is the one which conforms most closely to the requirements both as to principles and methods. Time will
The Budget-Mr. Good

not permit full elaboration, but I quote some authorities in this connection. I shall examine the subject under the following headings:
First, a tax upon land values is in proportion to service rendered, in regard to which I quote the following from C. J. Buell, author of The Minnesota Legislature:
All the benefits of government are accurately measured-not by any man-made statutes-but by a law of nature as irresistible as the law of gravitation.
What is that measure? The measure is this: The benefits of all good government are accurately reflected in the value of land. Why is a lot in one part of a city worth five, ten, a hundred, a thousand times as much as the same sized lot in another part of the same city? Everybody knows the answer. Where the streets are improved-paved and curbed, with sidewalks, water, gas, sewer, street car service, etc., there lots will be high priced, provided only that these improvements have been put in where they are needed -where the people congregate and need them to use. Build a new schoolhouse and lots go up in price. Run a paved road through the country and the farms will sell for more money. But good government is not the only thing that increases the price of land in the country or lots in the city. Every child born into the world adds to the value of land.
And he continues to elaborate that thought. I have also a quotation from Henry George dealing with the same subject but as it is somewhat lengthy I shall only mention it. However, I should like to quote a statement made by Dr. Bland, who is well known by most of the western members present. He says:
But, to ascertain what benefits any man derives from living in a certain community is not impossible. It is not even difficult. He cannot live in such a community except on the land, and the price men are willing to pay for land represents precisely what in the general judgment are the advantages which that community provides for that location. Everything is taken into account in fixing that value-police and fire protection, schools, churches, roads, sidewalks, social and business opportunities. The price a man is willing to pay for any piece of land apart from improvements is his own acknowledgment, without any evasion or falsification, that he thinks it worth that much, at least, to be a landowning member of that community. The community, then, has the right according to its needs, to tax that man precisely in proportion to the value of the real estate he owns. If his real estate is very valuable, he is enjoying great benefits and should pay proportionately. If his holdings are of little value, he should pay little. If he owns no land, he should pay nothing.
It is obvious no man can live in that community except as a landowner unless he obtains permission to live on somebody else's land. To obtain that permission, he will have to pay that landowner at least all the latter thinks the privilege of using that land is worth. This includes all the benefits that the community confers. Consequently, every tenant pays for community benefits in his rent. If a further tax is imposed on him he is being compelled to pay his taxes twice.
I had other quotations, Mr. Speaker, but I cannot cover the subject in any exhaustive way; I simply submit these as samples in
[Mr. Good.J
proof of a statement which I think can be made abundantly clear.
Second, this species of taxation cannot be shifted. I have here six quotations from economic authorities dealing with this point. I shall read only one of them, from Professor Thorold Rogers' Political Economy, as follows:
A tax on commodities is always transferred to the consumer. A tax on rent cannot be transferred.
I have further quotations from Walker's Political Economy; John Stuart Mill's Political Economy, Ricardo's treatise on the same subject; Thomas G. Shearman's Natural Taxation, and E. R. A. Seligman's Incidence of Taxation. The argument, in brief, is as follows: If this tax can be shifted, if we may suppose that a landlord can diift his tax to his tenant, then he can raise the rent, but in that case the tenant will vacate unless other landlords can also raise their rents. To become effective, therefore, rents must be capable of being raised all round. But as everyone knows, the taxation of land values penalizes the holding of land out of use and must result in a tendency toward lower rents; therefore, the initial supposition is proved impossible. I have much additional information on the same point, but I think it need not be given to the House to-night. It can be clearly proven, Mr. Speaker, that this tax cannot be shifted.
Third, it cannot be evaded. Land cannot be hidden. The values are known or easily ascertainable; no tax dodging is possible. I should like to quote from some authorities in that connection, but as the hour is late I shall simply leave it at that.
Fourth, it will tax privilege and not industry; it will break monopoly and get rid of speculators. I have two very short quotations from Professor John R. Commons, of the University of Wisconsin; the first is as follows:
Tax reform should seek to remove all burdens from capital and labour and impose them on monopolies.
The other quotation is as follows:
If the size of fortunes is taken into account, it will be found that perhaps 95 per cent of the total values represented by these millionaire fortunes is due to those investments classed as land values and natural monopolies, and to competitive industries aided by such monopolies.	[DOT]
That is from Prefessor Common's book on the Distribution of Wealth. In that connection I need only refer to the land gambling mania that prevailed in our own northwest during the years 1910-12, with all its horrible and disastrous consequences.

The Budget-Mr. Good
Fifth, this type of taxation would stimulate production by cheapening land, cheapening commodities and forcing social parasites to work. I quote the following from Surgeon General Gorgas, who, you will recollect, supervised the construction of the Panama canal and may therefore be supposed to be a man of some weight and judgment in the United States. He wrote as follows in the Constructive Quarterly in 1916:
For the first two hundred years of its settlement the United States had no tramp at the edge cf starvation. Is it possible for us to reconstruct the economic conditions which existed during those first two hundred years? It seepns to me that it is. . . . Fifty-five per cent of the arable lands are at present held out of use. .	. .Any system of taxation whereby land values were taxed to such an extent that it would be unprofitable to keep them unused would bring about this desirable condition.
I have also, Mr. Speaker, some quotations from the late President Harding, Senator Ladd of North Dakota, Mr. Cullman of Chicago, president of the Manufacturers' and Merchants' Federal Tax League, and the following advertisement which is, I think, very notable. Members have heard of the place called Muscle Shoals in Alabama. Here is an advertisement that appeared in one of the American papers:
'Buy lots in Muscle Shoals-'The Chicago of the South '-now! Your lots will be right in the path of the city's development. No matter who develops Mupcle Shoals-government or private enterprise-Vast new industries are assured. These industries will mean a great inflow of population to Muscle Shoals, and land prices will advance rapidly.
" Remember the basis of all land value is industry. Industry means population. Population means land values. The greater the population, the greater the land values."
This, of course, is a direct appeal to the cupidity of investors to protect themselves by buying this land and then exploiting those who might need to purchase it in the future. A few years ago I noticed a similar advertisement that appeared in one of the western papers with respect to land in Manitoba, advising investors to "buy now." That was just before the soldiers came back, so that when the soldiers should return, land hungry, the way would be clear to extort high prices from them. That was a compliment to Canadian patriotism!
Sixth, it is adequate to meet the needs. I have several quotations in that connection, but I shall read only one, from the Chairman of the United States Commission on the High Cost of Living. This article appeared in July, 1917. It says:
The committee estimates that the aggregate unearned profits of land speculators, owners of natural resources and natural monopolies is approximately six and a half billion dollars this year, while the producers of the
'country have to pay nearly two and a half billion dollars in taxes, because landowners are permitted to retain most of the ground rent.
I may say I personally made some investigations as to the adequacy of the taxation of land values some years ago, and according to my figures-I have forgotten the exact figures at the moment-we could get a very large proportion of the revenue which is now necessary in Canada by a very moderate tax on land values.
Moreover, this type of taxation effectively discriminates between earned and unearned incomes. I mentioned when the resolution of the hon. member for Chambly and Vercheres (Mr. Arcbambault) was under discussion in this House that I would point out a more logical distinction between earned and unearned incomes than was described in his resolution, and I would like to submit to the House now that here is a logical and precise distinction between earned and unearned income. Theodore Roosevelt wrote as follows in this connection in the Century Magazine of October, 1913:
We believe in a heavily graded income tax that discriminates sharply in favour of the earned, as compared with the unearned incomes.
William G. McAdoo, who may be a candidate for the United States presidency at the next presidential election, spoke as follows at Newton, Kansas, in. 1921:
The time has arrived when earned incomes should be distinguished from the unearned, and taxed at a lower rate.
I have another quotation from Professor Brown of Missouri University but I shall not read it on the present occasion.
Now, Mr. Speaker, having thus surveyed the field from the standpoint of economic theory, and established certain principles, and outlined the way in which the taxation of land values harmonizes with those principles and with sound maxims of taxation, I would like to submit very briefly to the House an outline of the progress which has been made throughout the world in connection with the movement for the taxation of land values.
First, in Europe:	Municipally throughout
Europe this system has been applied in connection with many municipal enterprises, not perhaps in the way it has been familar to us in America, but effectively though in a slightly different form. The king-10 p.m. dom of Denmark, a country which has led the world and is still leading the world in very many respects, in the year 1922 adopted for federal purposes a tax on land values, and I have here in this
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magazine a very interesting article outlining-the growth of this movement in Denmark, which culminated in the course of some twenty years of education and propaganda in the establishment of this national tax on land values. It is perhaps significant that the movement in Denmark was begun by the organized farmers, and has been maintained by them ever since. Denmark is well known to us as a country of farmers, as a country which has shown the world and particularly the farmers of the world the best methods of organization, a country which stands out probably above all others in many essential respects, and certainly the first country in Europe to adopt what I claim to be this better sj'stem of taxation for federal purposes. Some time ago, in fact it was just last year, an international conference was held in England dealing with this question and I have here an address delivered by a Danish woman entitled the "Spiritual, Mental and Economic Background for the Henry George Movement in Denmark." She gives a very interesting account of the growth of this movement in Denmark. That is all the information I have time to submit in this connection as to the European situation.
Now in. the Australasian countries this system has been adopted municipally provincially, and federally, for a good many years. T need not give the details as the hour is late, but there more than anywhere else this system has been worked out with considerable advantage. I must admit it has not developed much in recent years, probably due to the very heavy taxation resulting from the war. It may be also that as eternal vigilance is the price of liberty and progress, some friends of the movement there have become weary in well doing. I have a good deal of information here as to taxation in the Dominions of Australia and New Zealand which I shall simply refer to in passing, and not give to the House; I wish time permitted me to do so, but it will not.
Now in Canada I think we are more familiar with the situation, particularly our western members. I desire, therefore, simply to refer in passing to the very considerable degree of application of this system of taxation municipally in the various Canadian provinces, also to the provincial taxes on wild lands, or surtaxes or extra taxes that have been adopted in our western prairie provinces. I note also as significant the exemption of live stock and implements in practically all of the Canadian provinces for municipal taxation, and the additional exemption of buildings throughout 
all the rural municipalities, I understand, on the prairies. We all know the Drury Act that was passed in Ontario some few years ago, but which was recently repealed by the present government of Ontario, a most unnecessary and unfortunate action, in my judgment.
Federally, I would like to point out that this matter received some consideration in the Canadian parliament in 1919, when a subcommittee of the House of Commons, with Mr. Calder as chairman, reported on suggested forms of taxation as follows:
With respect to the federal land tax-
That was intended, I believe, to be a federal land value tax, although it is not so stated.
-this proposal came from many sources and is worthy of consideration. There is no question of jurisdiction.
If parliament desires to levy a tax on all land within Canada whether used or not, it may do so.
Sir Thomas White, then Minister of Finance, said he had thought about a tax of this kind. There were some estimates as to what it might yield at that time. The further information I have here in connection with the Canadian situation I shall not submit to the House. I would like to remark, however, that there are a number of Labour organizations which have taken a definite stand on this matter. I have a resolution which was sent to me by one of the local labour organizations, also a resolution passed by the Ontario Independent Labour party in 1920, as follows:
Therefore be it resolved that this convention favour the following plank in the party platform:
The gradual elimination of import duties on all necessaries of life, such as food, clothing, including boots and shoes, and the tools and machinery used in production, the revenue hitherto derived from this source to be derived from taxation of land values and luxuries.
So far as the United States is concerned, the matter has been before congress for some years. I cannot say just what headway has been made, but Mr. Oscar E. Keller, one of the congressmen from Minnesota, has had several bills before congress for some years past and I have a copy of the Congressional Record, giving his speech delivered in congress on the 18th January last. I will quote a brief statement of his proposals as follows:
The tax plan which I herewith submit consists of four bills. My first bill repeals a large variety of excise and nuisance taxes, including all corporation income taxes, the total reduction from these sources amounting roundly to $1,075,000,000.
My second bill makes a distinction between earned and unearned incomes, and cuts the present rate on earned incomes in two, making a total reduction of about $230,000,000.
My third bill increases the inheritance tax to the ' extent of about $110,000,000.
My fourth bill places an excess tax of 1 per cent on the privilege of holding lands and natural resources worth over $10,000, after deducting all capi-

The Budget-Mr. Good
tal and labour values, improvements, standing timber, and fertility. This bill, as I shall show, will yield about $1,100,000,000 a year.
I refer to this to show that the matter is being considered seriously in the United States. It has also been under consideration locally in the United States for some time. In Pittsburg they have had it partially in effect for ten years with very satisfactory results. I shall not now refer to the various arguments presented in congress by Mr. Keller. I have much additional information regarding the situation in the United States, but as the hour is late I shall not submit it to the House.
Some time ago an hon. member in this chamber said we were not looking for precedents to the United States, that we ought rather to turn our eyes to Great Britain, and we have often heard of "the mother of parliaments." Therefore, I submit certain information to the House as to the situation in Great Britain. I quote first from the manifesto of the Labour party now in office:
The Labour party proposes to restore to the people their lost rights in the land, including minerals, and to that end will work for re-equipping the Land Valuation department, securing to the community the economic rent of land, and facilitating the acquisition of land for public use.
The increased revenue derived from taxation of land values would make it possible to reduce the burden of income tax, abolish not only the food duties, but also the entertainments tax, and the corporation profits tax, as well as provide money for necessary social services.
I might quote also the following from the present Lord Chancellor of the Exchequer, Phillip Snowden:
We hold the position that the whole economic value of land belongs to the community, and that no individual has the right to appropriate and enjoy what belongs to the community as a whole. Let there be no mistake about it. When the Labour government does sit upon those benches it will not deserve to have a second term of office unless in the most determined manner it tries to secure social wealth for social purposes.
I have also a quotation from Ramsay MacDonald which I shall not read.
However a short time ago a deputation waited upon Mr. Snowden, representing 221 members of the British parliament who were personally pledged to the taxation of land values, and I have here a rather extended report of their interview with Mr. Snowden. I quote the following:
Mr. Snowden said he agreed that the deputation was entirely unique in this respect that so far from seeking to make a raid on the treasury, it came to him with suggestions which would ultimately result in a large increase of revenue. He was in general accord with the aims of the deputation, and he adhered without qualification to the statement which he made last year that it was desirable to obtain for the public the enormous social economic value of land. He was in agreement as to the theory, the justice and the necessity of the taxation and rating of land values. The deputation had raminded him of promises made by the Prime Minister. He was pledged individually, and the Labour party was pledged as a party" to deal with the matter at the first available opportunity.
I will not read the rest, but he goes on to speak about the difficulty under which the Labour party is exercising power at the present time, and the practicability of bringing this into effect in the immediate future. I quote also the remarks of the Right Hon. C. F. G. Masterman in reply as follows:
The Right Hon. C. F. G. Masterman expressed the thanks of the deputation to Mr. Snowden and repeated the assurances which had been given that he would receive support from all progressive sections of the House of Commons in any proposals for the taxation of land values which he was able to introduce in the forthcoming budget. They would be prepared to spend nights as well as days in assisting him to press the measure forward, and would not care in the slightest to whom the credit was given so long as the object which they desired was achieved.
As hon. members know no such proposal was brought down in the last budget by Mr. Snowden for the very obvious reasons outlined by him in his reply to the deputation.
I mention next the question of the feasibility of the taxation of land values. There seem to have been doubts in some people's minds as to the feasibility of this system, but I submit the feasibility has been demonstrated by the actual carrying out of this idea in a great many countries. It was also considered feasible by a committee of this House a few years ago. I submit also that the taxation of land values is applied in part throughout Canada for local purposes, and during the war there was a provincial tax- not a tax on land values but on real estate- levied by the provincial government of Ontario for war purposes-a tax of one mill on the dollar on real estate.
I should like also to submit to the House that here is a system of taxation by which the federal government can utilize some of the machinery already being utilized for local taxation, at least to a very large extent; and in that way there will be great economies effected. The problem of the equalization of assessment is not an insuperable one, because it has been already tackled and solved to a reasonable degree by our various municipalities. For instance, in Ontario we have equalization as between the various townships for county purposes. We merely require the extension of the same idea in respect of provincial or federal taxes. I submit to the House also that here is a system in which we can collect local provincial and federal taxation with the same machinery. And any modi-

The Budget-Mr. Good

fication of it, such as is in conformity with the principle of "ability to pay," may be carried out through the existing income tax machinery.
We have at the present time a most complicated tax machinery and it is high time that there was some simplification. I should like to know the average cost of collection in Canada of our various taxes. I think it will be found to be very high. The multiplication and overlapping of machinery, is scandalous. In the taxation of land values we have a system that would lend itself easily to a very marked simplification in machinery. I do not, of course contend for reasons already advanced, that taxation of land-values is the only kind of taxation that may be justified. As I said, I think the principle of "ability to pay" has some logical and philosophical basis; but we ought to go very much further in the application of the taxation of land values than we have yet gone. We have not applied it at all as yet for federal purposes, and it is high time that we gave this matter consideration.
Concluding and in reply to the question of the hon. member for South York (Mr. Maclean) as to a commission or committee, I understand that in the Speech from the Throne the appointment of a committee or commission to study methods of taxation is foreshadowed. In fact, the government has, I believe, promised-and the Acting Minister of Finance (Mr. Robb) made reference to this the other day-that a committee would be appointed to study methods of taxation. I heartily endorse that suggestion; I hope it will be promptly and effectively carried out, and whether or not the committee should be made permanent will appear later. But the appointment of a committee immediately to go into this matter carefully, to study principles and methods, and to make some recommendations, is entirely wise, proper and timely. In that connection, too I should also like to repeat what I have said before, that there should be some co-operation between the federal, provincial and municipal authorities in order to abolish the present overlapping and waste.
I realize that I have imposed at great length upon the patience of the House; but as I stated at the outset, I would not have felt justified in speaking at this length, were it not for the fact that this subject, so far as I know, has never before been presented to this House in any but the most cursory fashion. For that reason and because of promised committee of inquiry, I have placed myself on record.


Mr. JOHN CARRUTHERS (East AI-goma):: Mr. Speaker, as a back bencher, one

who is not enamoured with the sound of his own voice, I purpose to be very brief in my remarks on this subject to-night. In the first place, I wish, with former speakers, to express my regret at the absence from his accustomed place of our revered Minister of Finance (Mr. Fielding), and at the same time to congratulate his understudy upon the concise and short way in which he delivered the budget speech on this occasion, a budget speech that, I think, is more far-reaching and momentous than any that has ever been delivered in this House since the days of the so-called National Policy. In connection with that National Policy, I should 'like tc put this question to the House. Will any hon. member stand in his place and state that he is satisfied with the progress that Canada has made in the last forty-five years under a high protective tariff? Canada, a country which comprises more than one-half of the continent of North America, a country that is rich in natural resources, yet in this year of 1924 has a population of only -I was going to say 9,000,000 people, but it is really less than 9,000,000 people.
I do not intend, as I said, to deliver any learned discourse upon this question. We have just heard a very learned symposium on taxation from the hon. member for Brant (Mr. Good), which leaves nothing to be said upon that point. We have also listened to many figures and statistics during the last few weeks in connection with this debate, figures and statistics that very few paid much attention to and, I believe, very few read after they are'printed in Hansard. I intend only to give expression to a few wandering thoughts that have come to me in the somewhat idle hours I have spent in this chamber listening to the debate. One thing that has somewhat bewildered me in this debate is the action taken by our friends of the opposition in regard to two questions: One in regard to the Canadian National Railways; the other in regard to the protective tariff. As hon. members all know, the Canadian National Railways was a foundling left upon the doorstep of the Liberal party by our Conservative friends opposite. We had to take it in and do the best that could be done to keep it alive. We have done fairly well and the husky chap is growing very nicely, but unfortunately our friends opposite refuse to grant it the proper nourishment which would come from the branch railway lines that are required in order to keep the growth of that railway intact. The other question is the action taken in regard to the National Policy. I am a young member in this House, but I can well remember

The Budget-Mr. Carruthers
the election campaign of 1878 when the National Policy was propounded by the Conservative party. In our old home county of Haldimand, I think it had no better advocate than the late Nicholas Flood Davin, whom a good many in this House will remember. I can remember perfectly the stand that he took in regard to that policy, namely that it was to be only a temporary policy and that as the industries which were protected grew in strength, the protection was to be gradually removed until it was wiped out altogether. I might also draw the attention of the House to the stand taken by the present leader of the opposition Mr. Meighen) in 1911 in regard to the National Policy. The resolution that he moved in this House on that occasion was as follows: That in the opinion of this Hous? a substantial reduction in the import duties on agricultural implements is now due the agriculturists of Canada, and is in just a'ccord with the true end of a protective tariff.
That sounds almost like an echo from Brome. He also goes on as follows in the eloquent speech that he made on that occasion. I will quote just a few extracts from it and this is one of them:
It is this, that in their attempts, to continue the National Policy which had obtained for years before, they have overlooked, they have neglected one essential feature of that policy, they have quite forgotten its guiding principle, namely, the principle that as our industrial institutions advanced in strength and as they were able with every advance to acquire a hold on the home market, the import duties were to be diminished and adjusted in order to meet the evolving and changing conditions. It is that restraining, guiding principle which I claim this government has entirely overlooked, and as a consequence they have allowed, in the respect which I am discussing this afternoon, protection to run rampant, and they have for reasons that are only too obvious, become the slaves of those who helped them into power and who now maintain them there behind ramparts if gold.
I am afraid the leader of the opposition has capitulated to those gentlemen behind the ramparts of gold. Further on in the same speech he says:
Now, Sir, what are the manufacturers of agricultural implements enabled to do? They are able, under this tariff, to exact a higher price than they could exact if the tariff were lower. I do not say that a reduction will, to any very enormous extent, affect the price; I believe it will materially, and I think it will render some relief to, particularly, the farmers of the West, many of whom, notwithstanding any statements that have been made here, are struggling between success and failure every hour. It will accord some relief to them and I believe it is the bounden duty of the government to so afford it.
Here is another gem:
From 10 to 20 per cent is about the addition which these manufacturers are able to obtain from our farmers, by reason of the increased protection afforded them by this government.
121i
Let me cite another passage from the' hon. gentleman's remarks:
-but it has remained for this government to push the line far beyond that, and they have not only given the manufacturers a grip on the whole home market, but practically given them a monopoly of it and they have taxed the consumer in order to push the manufacturers and their industries successfully into the markets of the world.
A further statement he made was this:
But before I go into that, 'let me give you a few figures to show that the conditions of manufacture at the present time do not warrant a very material duty of any kind. . . . and I think I will convince the House that there is very little, if any difference in the cost of production of these machines on this side of the border and in the United States. . . . They (the manufacturers) are able under this tariff to exact a higher price than they could exact if the tariff were lower. It (the reduction of the tariff) will accord some relief to consumers and I believe it is the bounden duty of government to so afford it.
That was his view in 1911. At the beginning of this'year, or in the latter part of last year, at London, speaking at a Conservative meeting, he made the following statement:
The tariff is at the bottom of the commercial stagnation of Canada to-day. The 2.J per cent reduction on farm implements has been followed this year by an increase in the cost of implements of Canadian manufacture and the mounting cost of production.
Now there is the problem. If the 2 1-2 per cent reduction in the duties on implements in 1922 has increased prices, why would a substantial reduction in 1911 have reduced them? It seems a strange conclusion to draw, and I wonder whether the leader of the opposition expects the Canadian people to accept "such a jumble of inconsistencies" as a National Policy for this Dominion. Protection to my mind is an unsound and illogical policy, especially for a young country like Canada which has great natural resources to be developed; for if you followed out protection to its logical conclusion, every country in the world would have a right to resort to it; and with a prohibitive protective duty in force everywhere, where would international trade go to, or what would become of the exportable surplus of the products of any country? Why, international trade would absolutely vanish and the manufacturers of each country would have only the home market as an outlet for their products.
I come from a riding in which all the basic industries are carried on-farming, mining, fishing, lumbering and paper making. It contains an area of about 20,000 square miles and has a population of some 50,000. Yet I can say that ever since my advent to this House 1 have received no request from any of the manufacturers or any of the other

The Budget-Mr. Carruthers
The representative of Prince Albert in the House of Commons, Mr. Andrew Knox, has been having a discussion with the Ottawa Citizen with regard to the Hudson Bay Railway. He concluded a letter to that newspaper as follows:
" Lastly, it might be well to keep in mind that editorials of this character will not deter the West from insisting that this much delayed, though much needed, national enterprise be completed at an early date."
Then the Edmonton Journal goes on:
It has too long been the habit of parliamentarians from this side of the Great Lakes to undertake to speak in the name of " the West," when setting forth their individual wishes, or those of their own particular districts. At least half of " the West " is very little interested in the' completion of the line to Hudson Bay and it is doubtful if the people of the other half are as much concerned in having the project put through as its advocates represent. Alberta and the western half of Saskatchewan would be very foolish to lend their influence to it, when all the money that the government can spare is so badly needed for the construction of branch lines and the development of the western route. It is on the latter that the increased prosperity of the area in question must largely depend. There can be no comparison between the benefit which the West will derive from this route and that which can come to it through the Hudson Bay line.
Then, here is a small quotation from the Swift Current Herald.


Mr. KNOX:: Might I ask if the hon. gentleman knows who controls the Edmonton Journal?


John W. Carruthers: No, I admit I do not know, I am just quoting what is given in the papers out there, which shows that they are not in perfect agreement on the subject throughout the western country.


Andrew Knox: I think the hon. gentleman would find it interesting if he would investigate.


John W. Carruthers: Well, we will try to investigate. How about the Swift Current Herald? Is it owned by the same people? Here is what the Swift Current Herald says:
Misrepresentation prospereth nothing, and instead of assisting in getting early completion of the Hudson Bay railway by the style of campaign now being waged, the desired end will probably be defeated or postponed indefinitely. It is well known in informed quarters that there are many heavy investments in mines, etc., along the route and that these investors are anxious to get quick financial action through completion of the railway to the bay. They believe that by filling the minds of the farmers of the prairies with fairy tales about " transportation savings " there will be sufficient pressure brought to bear at Ottawa to hasten completion of the steel to Port Nelson.
That is from Saskatchewan.


Andrew Knox: Is that not proof that there are some possibilities along the line of railway?


John W. Carruthers: I am talking about it as 'a navigation project. In Ontario, where they found minerals in the north country, the provincial government built the Temiskaming and Northern Ontario road in order to permit the development of the mines.
Just one word more in connection with the Hudson Bay project. I wish to draw the attention of the Minister of Railways (Mr. Graham) to a press despatch in the Toronto Globe of April 30 which reads as follows:
Sir Henry Thornton to-day told a deputation from the " On-to-the-Bay Association " that he intended this summer to secure first-hand information on the Hudson Bay railroad through a personal trip of inspection which would take him to the end of steel and to the bay itself.
Then comes this, to which I wish the minister to pay particular attention:
Sir Henry Thornton said that if the government would vote the money for completing the road he was quite willing to go through with it.
Now I would like to ask the minister if this is what Sir Henry Thornton is paid $50,000 a year for, to pass the buck along from himself to the government and to parliament? I do not wish anyone to think that I have not a great deal of confidence in Sir Henry Thornton, because I have. I think he is a big man, and that he is handling a big job in first-class style. I do not think he gets a cent more than he is worth, and I am very doubtful if he is properly reported here, because that is not his duty at all. We' are not paying him for passing the buck, if he did so, on to the government and this parliament. He is the man who must decide upon these questions from a business standpoint. He must give them his consideration, and then give us his advice as to whether the Hudson Bay route will be a paying proposition. If he thinks otherwise, he should not advise this government or parliament to spend any money upon it; that is my idea, at any rate.
Now, Mr. Speaker, I would like to say a few words about water transportation. We have in this country the greatest inland system of water transportation on the globe, but we are not utilizing it to the extent we should as a cheap method of transportation. The reason is, there is no government regulation of freight and passenger rates. The rates in my part of the country between Owen Sound and the Soo have almost tripled in the last twenty years and I suppose this applies to all the lake traffic. The steamboat companies are a law unto themselves, and we all know what happened when the government tried to regulate the rates on grain between Port Arthur and Fort William and the lower lake ports last season, but I can assure the

The Budget-Mr. Carruthers
members of this House that the action of those large American steamship companies last year did more than anything else to crystallize public ownership sentiment in this country, at any rate in the province of Ontario, and we hope that during the coming year the government will utilize the merchant marine and other vessels to keep down the rates in the transportation of grain and other commodities from the western country. Another thing that should be done to cheapen transportation as soon as the finances of the country will permit is the construction of the Georgian Bay canal, which is about 300 miles nearer the seaboard from the head of the lakes than any other route.
Transportation experts claim that under normal conditions, even if the St. Lawrence waterway were deepened, grain could >be carried by the Georgian Bay route anywhere from 3i to 5 cents a bushel cheaper than by the St. Lawrence route, so that I am surprised to hear anyone have the hardihood to advocate the latter as far as navigation is concerned. Of course, we know that the development of eledtric power is really at the bottom of all this agitation for the deepening of the St. Lawrence waterway, but on the Georgian Bay canal we can develop nearly as much horse power and at about one-half the cost, and it will also help out, as I have said, . in the cheapening of rail and Steamboat transportation.
The Georgian Bay route will be free from international entanglements. It will give depth as well as length to our country. It *will assist in developing the immense mining regions of the northern country. It will permit Nova Scotia coal to compete successfully with the foreign American bituminous *coal, and thus the boats will carry grain from the west, and return to the head of the lakes with coal from the east, and as everybody knows return cargoes is the only method by which freight - rates can be lowered. I may say that about 350,000 tons of American coal will be shipped through my own home port of Little Current this year for the industries of the north, at a value of about $2,000,000. It seems too bad that that money *should be spent outside of Canada when by the construction of this Georgian Bay canal it *could all be spent in our own country.
Here is another opinion upon the Hudson Bay route. It is from a retired transportation man who is now living in the West and is published in the last issue of Toronto .Saturday Night. He says:
This is not the time to force the government or the people of Canada to be stampeded blindly into what may well be a colossal blunder, so let us get down to facts, at least, instead of proceeding on sentiment and theory-ascertaining what the practical expectation will be if this route is completed and provided with facilities.	.
To start with, let us obtain a report from one or more thoroughly competent steamship officials, with managing and traffic experience in the North Atlantic trade, who can furnish the details of all costs which will have to be met, in addition, if any, to those applying in the St. Lawrence trade, in order that some reasonable estimate can be made of the probable freights which will have to be exacted from the bay. This will have to include extra costs of every kind in the ocean transportation, contrasted with costs from competing ports.
Another essential report should be one from the outstanding grain exporters, as to the value of grain available for export through the hay route, as against other North Atlantic routes in the world's grain traffic. From the same source, the extra charges for^ carrying grain over in storage at the bay, or in the interior, can be readily procured.
Surely we should be sensible enough to look to experts for such knowledge, on which the government might act with the full approval of the public which must eventually pay the bill, rather than the incitement to action by Grain Growers, Women's Clubs and others seriously lacking in expert knowledge of the business conditions and operations of the export trade. Regardless of political pledges covering the last thirty years, why not start out for the first time in a business-like manner?
Is not that good sound common sense? I will leave it to the judgment of the House. He continues:
We are struggling as best we can to reconstruct out lives and business under a smothering load of taxation and excessive cost of living. Let us not complete our ruin by rushing blindly into enormous, and probably useless expenditures on sentiment, theory or specious, if not opportunist, political pledges of the past.
I should like, in conclusion, to read a few extracts from the Sessional Papers of 1909 in regard to the Georgian Bay route. As all know, a thorough survey was made of that route, and the following is taken from the engineer's report in the Sessional Papers of this House of 1909:
Moreover, when this waterway can show from the head of the Great Lakes to the nearest ocean port, a through route shorter by nearly 300 miles than any other existing or possible route, thus assuring faster trips, quicker and larger returns, and lower through rates, it is bound in my opinion, not only to attract attention but to secure trade.
And again:
The Ottawa river route, which is the most direct and quickest possible waterway from the northwest to a sea port. Only that route, in my opinion, can ever successfully compete with the routes which the United States authorities are trying to develop, and keep the transport of our trade wihin Canadian territory.
And again the report says:
T' e Georgian Bay shin canal if built will occupy a privileged geographical situation over all other arter-

The Budget-Mr. Carruthers
ies of commerce leading to an ocean port. The reduction in time of transit will allow vessels to make more trips during the season, which will have a tendency to reduce the rates from Fort William to Montreal. Its northern position will give great advantage for the transport of perishable goods. Its course is far from international boundary lines and no international waters are involved.
And the last quotation is in regard to the importation of Nova Scotia coal to northern Ontario. The report says:
The advantages of the Georgian Bay ship waterway are apparent, as the Canadian coal shipped via the St. Lawrence comes directly in competition with United States coal, the route being along the international boundary. The proposed waterway, however, would carry it through the heart of the province .rich in minerals, the highest development of which depends upon coal.
Delivery can be made as advantageously to interior points in Ontario, from the line of the Ottawa route, as from St. Lawrence, lake Ontario or lake Erie ports.
The average lake rate on coal from lake Erie to lake Huron and Georgian bay ports is 35 cents per ton. The average rate to upper lake ports is 40 cents per ton. The average rail rate from the mines to, say, Cleveland is about 78 cents per ton, making a through rate of $1.13 to $1.18 respectively.
The average rail haul from the mines to the lake front is 140 miles. From Cleveland to Fort William about 800 miles-total 940 miles. Vessels engaged in this trade usually secure return cargo.
The distance Sydney to Montreal is 815 miles, Montreal to Fort William 882 miles, total 1,697 miles. Taking the lake rate Cleveland to Fort William as a basis, the rate Sydney to Fort William would be about 85 cents per ton as against a rate of $1.18 from 'the United States mines, with the advantage of nontranshipment. It will be noted that there is a difference of 33 cents per ton in the rate of freight to Fort William in favour of Canadian coal. To this add the duty of 53 cents per ton, making 86 cents per ton in all in favour of the home product.
Now, Mr. Speaker, I have summarized my suggestions as to transportation and they are as follows:
1.	Amalgamate the Canadian Pacific Railway and the Canadian National lines.
2.	Place the regulation of lake freight and
passenger rates in. the hands of the Railway Commission.	.
3.	Abandon the Hudson Bay route.
4.	Utilize the Canadian Merchant Marine in regulating lake freight rates.
5.	Encourage further development of the western transportation route both at Vancouver and Prince Rupert.
6.	Build the Georgian Bay canal.
7.	Government insurance of transatlantic traffic and regulation of rates by utilizing the merchant marine.
I think this is the most important question in Canada to-day and the only possible way for us to get the full benefit from it is to have complete government control of rates from the prairies of the West to the place where the grain of the West must be marketed,

in the Old Land, and the government must control it throughout, as hon. members can see from the experience we have had in the last year or two. They have cut down the rates on lake freight, but the other companies will say "Well, the traffic will stand a little more" and they will put up the ocean rates, and in that way the farmers of the West get no benefit.
I hope that the members of this House and the people of this country will get away from this narrow provincialism, get a wider outlook, and stop whining and whimpering about trade and commerce. Everything is going along all right in this country if we only think so.
The Minister of Agriculture (Mr. Motherwell) yesterday read the Massey-Harris statement, just to show our Conservative friends that we are not going to the demqition bowwows all at once and entirely-


Mr. STEVENS:: Just by piecemeal.


John W. Carruthers: And that there is an unrest which does not really exist among the manufacturers. Here is a report in last night's Globe, of an interview at Oshawa, with Mr. R. S. McLaughlin. It says that Oshawa will produce 5,000 cars, and so on, and the interview winds up in this way:
So far as the citizens of Oshawa are concerned, we hope that none of them will become unduly excited, as it looks to me as if we are going to have a very nice business, both domestic and export, and as if the horizon all around is gradually clearing a little.
It may interest you to know that the month of April w'as the greatest we have ever had. We shipped 4,755 cars. I am sure you will also be delighted to learn that our schedule for the month of May exceeds even that of April, as we will produce over 5,000 cars. These facts speak eloquently for themselves.
So that apparently all the manufacturers of this country are not so terribly worried as our friends, the Conservatives opposite, would lead us to believe.


Mr. SIMPSON:: There is no reduction on automobiles.


John W. Carruthers: I am not referring
to that. But remarks have been made across the way about feelings of unrest. It was not in regard to agriculture, but in regard to all other industries.


Thomas Edward Simpson: Automobiles cost money.


John W. Carruthers: In conclusion, I
think we should get away from all these whispers of death. This country is all right. All we need to do is to work. We have the proper policy laid down by our government, and I am confident it will mean successful business in the country for many years; therefore I -would implore my hon. Conservative

friends especially, to keep their eyes away from their shoe tops and lift them up to the mountain tops once in a while, and see the vision there of a united and prosperous Canada.
On motion of Mr. Stevens the debate was adjourned.
On motion of Mr. Graham the House adjourned at 11.12 p.m.
Friday, May 9, 1924