1924-05-02

BANKING AND COMMERCE

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Mr. W. G. MITCHELL (St. Antoine) presented the first report of the select standing committee on Banking and Commerce.

Mr. C. A. GAUVREAU (Temiscouata):: Mr. Speaker, I move, seconded by Mr. Marcile (Bagot):
That the first report of the joint committee of both Houses on the Printing of Parliament as appearing on page 204 of the Votes and Proceedings of this House be amended by inserting Nos. 35, 36a, 37 and 37a under clause 1 which enumerates the documents to be printed, and that the report as so amended do pass.


Mr. SPEAKER:: I must advise the hon. member that the motion as worded is out of order. The report ought to be referred back to the committee, and be there amended.


Charles Arthur Gauvreau: Mr. Speaker, those
numbers were approved by the committee, but through an oversight they were not included in the report made yesterday.


Hewitt Bostock: I understand there is an error. These numbers are already contained in the report.


Charles Arthur Gauvreau: Mr. Speaker, the documents enumerated were printed during the recess at the request of the Prime Minister. When the committee sat the other day it approved of this printing, and the report should have contained a list of the documents, but this was forgotten at the time and the report appeared without the particulars which are contained in the proposed amendment.

The Budget-Mr. LeSueur


Hewitt Bostock: The committee on Printing is a joint committee of the Senate and of the House of Commons. Do I understand that the insertion of these numbers was agreed upon by the joint committee?


Charles Arthur Gauvreau: Yes, Sir, and an order was given to Senator Smeaton White, joint chairman, to take the same course in the Senate.


Hewitt Bostock: Under the circumstances,
I think the House might agree to the motion. Is it the pleasure of the House to adopt the motion?


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Motion agreed to.

Mr. R. F. PRESTON (Lanark) :: Mr. Speaker, I beg to present a petition from St. Andrew's and Knox congregations, Perth, against the Church Union bill.


Mr. H. A. STEWART (Leeds):: Mr. Speaker, I wish to present petitions on behalf of the Presbyterian church of Westport, and the Presbyterian church of Newboro, against the Church Union bill.


Mr. ROBERT FORKE (Brandon):: Mr. Speaker, I desire to present a petition in favour of the Church Union bill from the church at Nesbitt, Manitoba, signed by 133 members. I may say this is a Union church, although it has been denied that there is any such institution.


Mr. L. H. JELLIFF (Lethbridge):: Mr. Speaker, I desire to present a petition against the Church Union bill signed by 89 members of Knox Presbyterian church, Lethbridge.



HOME BANK

Mr. J. J. THURSTON (Victoria, Ont.):: Mr. Speaker, I beg to present a petition signed by 879 citizens of the county of Victoria, province of Ontario, asking that the depositors of the Home Bank be reimbursed.


Mr. GRAHAM:: They seem to be united
in that.



ALBERTA MINERAL TAX ACT

Hon. ERNEST LAPOINTE (Minister of Justice):: I beg to lay on the Table of the House documents and papers with respect to the disallowance of the Mineral Tax Act passed by the Alberta legislature.



INQUIRY FOR RETURNS


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On the Orders of the Day:
Sir HENRY DRAYTON (West York):: I desire to call the government's attention to an order passed on 24th March, for papers in connection with appointments on the Canadian National Railway, an order which has been standing ever since; also to an order which has been standing since the 26th of March, calling for the return of papers, et cetera, forming the basis of or justification for the statements of Hon. E. M. Macdonald in North Sydney on the 28th of July, 1923, in which assurance was given of certain reductions of freight rates, and so on. I would ask the government when we may look for these returns.
Hon. GEORGE P. GRAHAM (Minister of Railways and Canals): I will look into the one concerning the railway matter-


Henry Lumley Drayton: They are both railways.


George Perry Graham: As to the other one, I will bring it to the attention of the minister concerned.



THE BUDGET


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The House resumed from Thursday, May 1, 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. R. V. LeSUEUR (West Lambton): Mr. Speaker, our discussions of the national budget sometimes, perhaps too often, entail comments and criticisms, which at times become rather severe, but in all cases the Acting Minister of Finance (Mr. Robb) should know that the arduousness of his task, the weight of the burden and the difficulty involved in the duties of his office, are fully and constantly appreciated by this House. This year the budget aroused unusual interest, both in this chamber and out of it, and upon that the Acting Minister of Finance is to be congratulated. Within the House it commanded that respect which the most important financial statement of the
The Budget-Mr. LeSueur
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year merits; in the country it has drawn to itself an unusually alert attention. There, it is every day becoming more generally recognized that this budget inaugurates a new policy on the part of the government, inaugurates a departure from this policy of tariff stability announced by the Minister of Finance (Mr. Fielding) last year, and that a responsible minister of the Crown has openly announced that he hopes this budget will prove the death knell of protection. If I rightly interpret the sentiment expressed in a number of orations made by hon. members to my left, they appear to have reason to hope that the changes and alterations in the tariff are not at an end, but that they will continue from year to year during the life of this parliament. The suddenness and the radical nature of this change on the part of the government are, I believe, causing widespread uncertainty ,as to whether the future actions of this government will not be largely influenced, perhaps dominated by, the tenets and dictates of the Progressive party rather than by the old-time principles of Laurier-Fielding Liberalism. Such a budget, Sir, should have a careful analysis in the light of present-day conditions. That analysis, I submit, should not be confined to conditions as they exist within Canada, but should include also a review of world conditions. We do not live unto ourselves alone, and a reasonably accurate knowledge of conditions both within and without Canada and of the general trend of industrial world events is essential to a correct estimate of the changes proposed in the tariff.
Turning to the budget itself and examining it, we find that the Acting Minister of Finance has arranged it in three main divisions. In the first division he discusses the financial condition of Canada; in the second he outlines Canada's trade position as evidenced by her foreign trade; and then, proceeding, I assume, on the conclusions arrived at in these two divisions, he comes to the third division, which deals with the changes he proposes in our tariff policy. I will endeavour in my remarks to adhere more or less to this order.
The first division, namely, that relating to Canada's financial position, has already been fairly well discussed and I will but briefly comment on it in passing. The Acting Minister of Finance pointe/i out that we have, for the fiscal year ending March 31, 1924, an estimated surplus out of ordinary r.evenue of approximately $20,800,000, and that this, together with an income from other sources of about $9,600,000, will give us a total of 
some $30,400,000 to be applied in the reduction of the national debt. The budget also points out, however, that the loan of $50,000,000, made on behalf of the Canadian National Railways and guaranteed by the government, has been so treated as not to affect or influence this result. It has already been pointed out in this discussion that, according to the system of bookkeeping in vogue prior to this year, that loan would be considered as part of our national debt and as a national obligation. But whether we accept the system of bookkeeping adopted this year or adhere to the system in vogue hitherto, is more or less a matter of accounting and does not alter the facts-and it is a fact,-that the Canadian National Railways could not, apart from the government, have secured a loan of $50,000,000 on reasonably good terms, possibly not at all, and that the investors who made that loan looked to the government of this Dominion and not to the Canadian National Railways for the repayment of their interest and principal. It i3 also a matter of common knowledge that the Canadian National Railways are to-day much over-capitalized, that their physical value is much less than their book value as carried on the ledgers of this government, and it would be a delusion and a snare to increase that book value, already too high. Whether we treat that money as being turned into capital, or into maintenance, or into deficit, it is as a matter of fact being handed over to a railroad already too highly capitalized which cannot pay the interest on the debts already incurred and which cannot for many years, possibly not during our life time, be in a position to have its assets offset it liabilities. In short, the asset, if any, which we acquire is certainly non-active, while the obligation assumed is most distinctly and strikingly active, as will be proved every interest day. Therefore, the only safe and sound course is to acknowledge that, so far as the investors are concerned and so far as we are concerned, we have assumed an obligation of $50,000,000 which cannot be eliminated by any process of bookkeeping or be altered by placing it, as it were, in suspense account as an indirect liability. Of course, the amount of money which still remains in the hands of the government from that loan is an asset. Then, considering this loan as a national obligation, and endeavouring to keep ourselves as close to the facts as we can, I ask, do we realize that Canada has since March 31, 1921, added to its national debt by the sum of approximately $118,000,000, while the country to the south of us has in the same period wiped out and eliminated from its debt $1,860,000,000?

The Budget-Mr. LeSaeur
Great Britain in the same period has likewise eliminated from her debt a very considerable sum-I see by their recent budget, this totals £960,000,000 since 1918.
Now., turning to the second division of the budget speech, namely, that relating to Canadian trade, we find it there set out that Canada's commodity trade balance has advanced from an adverse balance in 1914 and in 1921 to a favourable trade balance of approximately $160,000,000 for last year. This result is most gratifying to all Canadians, but it would be neither wise nor businesslike on our part to jump to the too hasty conclusion that therefore Canada is enjoying a period of prosperity; and, whether or not the Acting Minister of Finance (Mr. Robb) intended this inference to be drawn, several speakers who have followed him in this debate do appear to have drawn that conclusion. It is most important in my opinion that this House, as a deliberative body, considering the fiscal policy for this country should have as accurate ,a knowledge of conditions both within and without Canada as is possible, in order to enable them to properly estimate the changes proposed. The facilities for gathering data, and the science of gauging a nation's actual trade condition, have advanced wonderfully in the last few years. It is to-day fairly well recognized that the commodity trade balance of a nation is neither a true nor yet the best criterion of her condition. Such a trade balance does not take into consideration either the invisible exports or imports or the internal trade of a country. A much truer gauge to-day is the total physical volume and value of a nation's production; but perhaps the most accurate gauge is to be obtained by looking at several phases of national life. The soundness of this contention is easily demonstrated by facts-or perhaps it would be more proper to say, the lack of soundness in the first contention. The United States in 1921, a year of great depression, had a favourable trade balance of approximately $1,900,000,000. In 1923, a year of marked prosperity as compared with 1921, that trade balance had fallen to $376,000,000 or approximately a drop of 80 per cent. If we look at Canada, I believe the same result is demonstrated. Our trade balance this year if it were a true criterion, would indicate a condition of marked prosperity, and yet the statesmen who told our farmers or our merchants, or our manufacturers or our workmen, that we were to-day enjoying great prosperity would be laughed to scorn. Now in following up this subject I wish to take a look at the industrial trend of conditions in the principal
countries of the world, Great Britain, France and the United States, and I think a good point of commencement is to' be found in 1921, the year of that marked depression which gripped every industrial nation of the world from the most southerly to the most northerly, and from that low point we have a gradual improvement during 1922 and 1923 up to the present time.
Turning to the United States, what conditions do we find there? In 1921 the United States felt that depression most severely. There were between three and four million men out of employment. Industrial life in almost every line was at its lowest ebb, and in addition to that, European conditions were bad. The European trade machine was disrupted and unbalanced. In Europe the standard of wages and of living was receding rapidly and unevenly, exchange was fluctuating wildly and currencies were depreciating. In the face of those conditions the United States adopted the policy of protecting her own industrial life and her own trade machine. In May, 1921, she adopted the emergency tariff, and in November of the same year brought in the Fordney tariff. She re-established the activities of her War Finance Corporation to assist her cotton growers, her grain producers and her live stock raisere, and she raised the restrictions on immigration. The trend of industrial life since that time speaks for itself. What do we find happening in the United States? The Department of Commerce reports and the reports of the Federal Reserve Board, which are now very complete and very accurate, show that since 1921 mineral production in the United States has increased by over 40 per cent, industrial production by over 50 per cent; the movement of live stock to primary markets has increased by over 20 per cent; the movement of fruits and vegetables to primary markets has increased by about 25 and 5 per cent respectively. On the other hand, the movement of grain to primary markets has decreased by about 12 per cent-for reasons which I hope to discuss later. The retail trade and the trade of departmental stores in the United States has shown a similar increase and in some lines that increase has been equal to about 50 per cent. Their bank clearings have increased by about $3,500,000,000; their bank deposits have increased by approximately $1,000,000,000, and their bank commercial loans by over $500,000,000. As to ufnemployment, that has practically ceased to exist in the United States, and they are now giving employment to considerable foreign labour, which of course includes Canadian workmen.
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The Budget-Mr. LeSueur
In short, without taking up unnecessarily the time of the House, let us say that the United States appears to have adopted adequate remedies, suited to her industrial life, for the protection of her industrial machine against the destructive attack of the unbalanced European trade machine and that her rapid recovery has been the result; and her reward is a most rapid and startling recovery.
Now, let us look at France for a moment. In 1921 France felt severely the same depression, and apparently adopted the same means for the protection of her industrial life. On March 28, 1921 she raised her tariff to possibly the highest point in its history. Owing to the publicity given to the troubles of French government finance, it is perhaps a general feeling that like conditions prevail in private industry and that there conditions are also unfavourable. Such is not the case. If we look at the trade reports of our own commissioner, the trade reports from Washington, and such other trade reports as are available, we find the actual facts. France commenced to recover and she has continued to recover until to-day her iron and steel industries, her coal mines, and her silk, textile and woollen manufactures, her agricultural and her general industrial life, are enjoying a period of very great and very marked prosperity. Her bank clearings have pretty nearly doubled, not quite. Her bank deposits and her commercial loans, which show the activity of business, have increased by about two and a half billion francs each from the end of 1921 to the beginning of 1924. Unemployment in France is unknown. The latest report we have is for January, 1924, and that shows only 596 men unemployed in Paris. Other reports show that France has been importing foreign labour to meet the labour demands within her boundaries. As to the condition of France to-day I do not know of any more complete conclusion than to read the report of our trade commissioner written in January of this year. He says:
To sum up, France's balance sheet for 1923 shows a stabilized budget, reduced expenses, the development of fiscal resources and the extension of foreign trade.
Now, let us look at Great Britain for a few minutes. Great Britain likewise suffered from a very severe depression in 1921. Great Britain adopted certain partial and limited means to protect her industries during that depression, and I am glad to say she has made a certain amount of recovery. She has reduced her unemployment very consider-

ably, but there are still about 1,250,000 men out of work in Great Britain. Her bank clearings between January, 1922 and January, 1924, have increased by about £70,000,000; but her bank deposits and her commercial .bank loans have decreased by about £150,000,000 and £140,000,000 respectively. Her freight-that is the freight carried by her railways-has shown a substantial increase. Her iron and steel industries have advanced, but generally her other industries are considerably below normal. Her industries are, speaking as a general rule, much stronger financially, have much wider trade connections, and greater world banking facilities than the industries of almost any other country but in spite of these advantages, we must admit, from a general view of the trend in England, that the recovery of her industry has been slow, arduous and irregular, and that it is still far from complete. To be fair we must admit that a considerable amount of this has been dbe to strikes and labour troubles; but if we take our own trade commissioner's report we find that his view is even more pessimistic. His report likewise for January, 1924, and his general summary of British trade is that while it is to be hoped that the bottom has been reached, the immediate outlook seems somewhat uncertain. I think, perhaps, he is a trifle too pessimistic. But from the general view of affairs in England we may be certain that she is making a hard struggle; that while her comeback is slow and irregular, we believe the advance she is making is solid and finally she will pull herself through without doubt.
Now let us look at Canada and see if we can get a fairly accurate estimate of our trade condition, of just how we stand in our trade situation. Canada in 1921 suffered the same general depression and it was fairly severe. She, of course, was then under a moderate protective tariff which, while it may have been changed slightly by way of reduction has practically remained the same. We find that in 1921, the net value of Canada's total production was $2,728,000,000 while the net value of her total production for the 3'ear 1922, was about $2,740,000,000, an increase of somewhat under one per cent. The returns for the year 1923, are not yet completed but such returns as are available lead us to believe that we shall enjoy another slight increase. As to her industries, a grouping of her main manufacturing industries and a canvass of their operations show there has been' practically no advance in earnings since 1921-the earnings remain practically

The Budget-Mr. LeSueur
the same. But in certain lines of industry, in our mineral production and in our iron and steel works, advances and recoveries are being made. With regard to our departmental and retail stores it is very difficult to arrive at an accurate conclusion, but so far as we have been able to investigate they are still suffering from considerable depression, and a great many retail stores are barely meeting current expenses. I believe there is plenty of liquid capital in Canada. This was evidenced by the ease and rapidity with which the Dominion loan of $200,000,000 and the Ontario loan of nearly $40,000,000 were absorbed in rapid succession; but the fact remains that so far as industrial development is concerned Canadian capital to-day is more or less frozen. In regard to our railway loadings from points within Canada these have shown a gratifying increase. Our bank clearings have shown between November, 1921, and November, 1923, an increase of about $200,000,000; but our bank deposits have shown a decrease of about $60,000,000, and our bank commercial loans a decrease of about $150,000,000;-I take the corresponding months on account of the seasonal variations which occur in trade. As to unemployment, our number of unemployed since 1921 has materially decreased, but the report for January of this year, the percentage being based upon January of 1920, shows an unemployment in Canada amounting to 7.2 per cent, and that despite the fact of the large number of unemployed who have gone to the United States. Now, much as I should like to report a favourable condition in Canada and a complete recovery and restored prosperity, still, in the face of these facts, and in the face of the fact that our farmers are still despondent, that our workmen are still leaving the country, that our capital is still chary about making any more industrial commitments than are absolutely necessary, we must be frank with ourselves and admit that, while Canada has recovered to some extent, at the same time that recovery has been slow and only partial, and in fact our trade is still below normal.
So far as the trend of conditions in all these four countries is concerned, as well as with regard to the degree of their respective recoveries I think it would serve but little purpose for me to discuss the theory of the situation. The facts, I propose to leave with this House, and I believe they are reasonably accurate and as close to the actual conditions as they can be obtained. I am convinced that anyone who judges these facts with a broad view and without preconceived prejudices, must admit that the tariff policies
of these countries have had at least some influence, and I believe a substantial influence, on the rapidity and the degree of recoveiy ' which has been experienced in them. The Acting Minister of Finance (Mr. Robb) prefaced his remarks, which explained the proposed tariff changes, by setting forth the trade condition of Canada so far as evidenced by our external business. I believe that was a sound way of approaching a consideration of the tariff changes; but I submit that it should have gone much further and should not only have taken into consideration, or tried to arrive at, the actual trade conditions of Canada, but should have taken into account also the world trend of events, the actual happenings of industrial life in these nations from 1921 to the present time. In my opinion, if (his House will judge the industrial conditions of these countries fairly, and will give a certain weight of consideration to the tariff policies under which their respective returns to prosperity have been brought about, we shall be much more chary of making reductions in the tariff or attempting changes which may impair our industrial life than we ordinarily are.
Let me turn for a few minutes to some of these fiscal changes as proposed by the Acting Minister of Finance. To judge the proposal one must first diagnose the malady, and I think we will all admit that the greatest of our present ills is the one now being experienced by the agricultural industry of Canada. I am going to attempt the perhaps too-ambitious task of analysing that condition, and may venture some suggestions but in doing so, I do not want to be considered as forcing advice upon my friends to the left, and such analysis as I may make is offered not as infallible but as an honest endeavour to arrive at the essentials of the situation. Let me preface my remarks in this connection by saying that I fully appreciate the tremendous importance and the basic nature of our agricultural industry, that I have the fullest sympathy with it, and that I quite realize that its prosperity is of vital importance to Canada as a whole. Now, what are the real causes of our farmers' unfortunate plight? In the first place, we should bear in mind that of all our raw materials, wheat is possibly one of the most internationalized and most subject to foreign conditions. Needless to say, there exists a condition of over-production; and let us remember that wheat is produced but once a year and is subject to weather conditions, so that the farmer cannot as promptly adjust himself to conditions as can
The Budget-Mr. LeSueur
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the manufacturer or certain producers of other raw material. We must furthermore keep in mind the fact that, as a general rule, and in the absence of abnormal influences, the curtailment or the increase of the total wheat crop is gradual and extends over a number of years. As to the degree of over-production which exists to-day, the figures given in the Book of International Statistics published at Rome show that during the years between 1909 and 1914 the average world production of wheat, exclusive of Russia, was about three billion bushels, which we may take as a normal figure for normal times. On the other hand, in 1921 and 1922, which were abnormal years, we find that production increased to about 3,116,000,000 and 3,120,000,000 bushels respectively. The biggest consumer of our wheat is Europe, and Europe to-day is below normal, is more or less impoverished. It is estimated that her consumption of wheat and rye, from both domestic and foreign sources, is about 20 per cent below normal. Thus we have a condition in which the supply is above normal and the demand below normal; we have a condition of over-production with all its attendant hardships. But that is only one factor and I believe there exist two other important factors coincident, so far as time is concerned, with this situation and seriously affecting our agriculture. The first of these is a world-wide tendency towards falling prices; and it is a general rule, almost a natural law that just as the price of raw material rises more rapidly than that of the manufactured article, so on the other hand the price of the raw material drops more quickly than that of the manufactured article. This is very well illustrated in the case of wheat, flour and bread. If we look at an imaginary chart, we find that the price of wheat rose in a very irregular line to its peak and that the price of flour followed in a more gradual curve behind the price of wheat until it reached its peak; and then, on the reverse side of the curve, that the fall of wheat came first and in an irregular curve, and flour followed. We find that the price of bread on the other hand followed the course of flour, rose in a jerky line until it reached its peak, and that then it again followed flour in its descent to the normal level. The fact is that, under normal conditions, and without other adverse conditions, the price of wheat would naturally fall to its normal level before the price of the manufactured article would.
In addition, I believe there is another factor which is affecting our western farmer. We have had a most tremendous expansion as [Mr. LeSueur. 3
regards our wheat, both in the acreage sown and in the quantity grown. Under the influence of rising prices and patriotic appeals, our acreage has increased from about 11,000,000 acres in 1913 to about 23,000,000 acres in 1921, 1922 and 1923. It is approximately at that figure to-day. Our wheat 4 p.m. production has increased from about 231,000,000 bushels in 1913 to approximately 470,000,000 last year. Such a tremendous expansion in short periods of time is, in nearly all cases, and has been, I believe, in our case, built largely on credit. The credit granted has been very great and the expansion has been very great. The result is that our western agricultural industry is spread out very thin. This alone is a condition which might prove very hazardous; but when there is added to it simultaneously the condition of .over-production with its attendant hardships and the hardships which attach to a period of falling prices, then we realize to some extent the actual fight which our western farmer has to face and the real problems to be solved. For the agriculturist, struggling as he is in the grip of economic over-expansion and buffeted about by great and inscrutable world forces of over-production and falling world prices, the remedy is proposed of reducing the tariff on agricultural implements, a remedy which, at its most optimistic view, as I understand the matter, can mean nothing more than a saving of ten or fifteen dollars a year to the average farmer, a remedy which carries with it the joker of injuring his home market by possibly destroying or greatly imperilling a great industry, that is taking the budget at its face value, and the remedy proposed is so insignificant and imaginary-if it is a remedy at all, compared with the giant forces from which we are suffering-that it appears trivial and not worthy of consideration. It is like sending a tin fish against the torrent of Niagara.
If we go beyond and do not accept the budget as it stands, but look behind the scene at the new regulation which has recently been issued altering the previous regulation of the dumping clause or special duty, then we find that even that amount of remedy has possibly been removed. The situation as regards the dumping clause is, I believe, clear, and I do not know that any purpose will be served by my going into it. I might, however, just say, in reiterating something which has been said in prior speeches, that for some years past there has been in force a regulation whereby, if the difference between the price paid by the Canadian importer and the price which the same article

The Budget-Mr. LeSueur
has as a fair market value in its place of origin is no greater than 5 per cent, then the dumping duty did not apply. The new regulation, however, issued on April 8, 1924, two days before the budget was delivered, repeals that special clause as to the 5 per cent, and now any machinery or other article coming in would pay full dumping duty. That would mean, as I understand the matter, that if an article is selling in the United States at $100 and the price quoted to the Canadian importer is $95, then under the old system there would be no dumping duty added, but the duty of 10 per cent would be added to that $95 making the price $104.50. Under the present tariff and the new regulation the dumping duty of $5 would be added, and in addition to that a tariff of 6 per cent on the $95, making the price $105.70 to the importer to-day as against the $104.50 before. I am not quarrelling with the protection to our industrial industries; I believe our industrial industries demand an adequate protection; but if the above is the situation, then the government is offering no remedy for our agricultural situation.
Mr. GARLAND (Bow River):: Will the
hon. gentleman admit that the removal of that 5 per cent margin in the dumping clause has really had the effect of increasing the incidence of protection all round? I think that was the hon. gentleman's argument and I want to get it clear.
Mr. LeSUEUR: I believe it has increased protection on agricultural implements.


Mr. SPEAKMAN:: In that case would
the hon. gentleman consider that the agricultural implement industry has been hurt at all by these changes?
Mr. LeSUEUR:	I have explained that I
am in favour of the protection of the agricultural implement industry and of all our industries, as I will indicate further on, but I say that under those conditions no remedy is offered either in the budget or in any other action by the government for our western ill.
I will proceed to some suggestions as to our agricultural situation. Are there any real remedies for that ill? Is there anything that we can do to help our agricultural industry in western Canad'a? If the report of the Dawes commission or some other satisfactory solution is adopted in Europe and Europe recovers, then I think we shall have some benefit from that source, but we must remember that Russia will be again entering
the export market, and that the recent agrarian reforms in central Europe are to-day having their effect by way of increased crops, and therefore that we have to face a protracted period in which production will continue to exceed demand.
Under these circumstances, what remedies can we adopt to help our Canadian West? Let me touch first on the foreign market. As I have said, the present situation of overproduction will probably continue for some time. But we have, I believe, a virtual monopoly on one thing and that is on the quality of exported wheat. It is admitted that owing to climatic and soil conditions our wheat contains a larger percentage of gluten than other exported wheats, and therefore it is mixed with soft wheats for maintaining the uniformity and standard of the best flours. Practically all other exported wheats to-day are soft wheats. In Europe it is a well recognized fact that the peculiar quality of our flour is an essential element in the blending necessary for the best standard of flour. In the United States it is also a well recognized fact that this inherent quality is what enables our wheat to jump over any tariff barriers which the United States may erect. Our wheat overcomes the handicap of tariff barriers and finds a firm market in the United States. Now, hardly a bushel of our wheat goes to Central and South America. Those countries to-day have a population of about 90,000,000 people, they can be reached by an all-water route from Vancouver, they are prosperous and can pay for our wheat; they import annually from forty-three to forty-five million bushels of wheat and about twenty million bushels of wheat flour. Their bread is generally of poor quality, and they are anxious to improve it. Therefore I feel satisfied that if we organize and push this business vigourously we can find a market there for at least fifteen million bushels of our wheat every year by reason of its superior quality alone, and a market for at least seven or eight million barrels of our flour, also on the ground of superior quality. The same remark applies more or less to Asia. To-day Asia is importing about thirty-two million bushels of wheat and about seventeen and a half million bushels of wheat flour, of which we are supplying a very small precentage. We have the quality to recommend our wheat and flour, and we should make the most of that weapon supplied by nature in developing a firm and secure market for these commodities. There is no reason why we should not get our trade commissioners in South America busy on this project and so establish a firm and growing

The Budget-Mr. LeSueur
market. It can be done. We might enlist the services of some of our brilliant journalists for the necessary propaganda. And it is generally recognized by industrialists that if you have quality in your goods the marketing of them is only a question of efficient organization. Therefore I would suggest that the development of these new markets be pressed vigorously and sedulously. Let us spend some money for the purpose and forget the completion of the parliament tower for a few years. Of course, we must maintain the quality of our wheat and flour, and I understand that our western provinces are taking steps to this end by encouraging the ' use of good seed and the adoption of crop rotation, and other similar measures.
As to the home market, let us consider what our attitude should be. In the first place, this is a sure market, or at least, it can be made so, for our agricultural industry. It is also our most important market, as can be demonstrated by figures. We find according to the Bureau of Statistics that in 1919 Canada produced 193,260,000 bushels of wheat, of which she exported 78,000,000 bushels and absorbed at home approximately 115,300,000 bushels, or nearly 59 per cent. In 1920 Canada produced 263,200,000 bushels, of which she exported 129,215,000 bushels, and absorbed at home about 134,000,000 bushels, or approximately 51 per cent. In 1921 Canada produced about 300,000,000 bushels, of which she exported about 136,000,000 bushels, and absorbed at home approximately 163,000,000 bushels, or about 54 per cent In 1922 Canada produced ^99,000,000 bushels, of which she exported
215.000. 000 bushels and absorbed at home
184.000.	000 bushels, or about 46! per cent. I ha\ e burdened the House with these figures simply to show clearly the importance of the home market.


Mr. McCONICA:: Does not the hon. member include in his statement of wheat consumed at home the amount that was ground into flour and exported?
Mr. LeSUEUR: I include everything that was used at home.


Thomas Henry McConica: So it was not consumed at home.
Mr. LeSUEUR: I include, absorbed by the manufacturing industries.


Thomas Henry McConica: Absorbed by the grinding mills?
Mr. LeSUEUR:	Absorbed in any way at
all.
Mr, SPENCER:	Will the hon. gentleman
give the House the amount of flour exported?

Mr. LeSUEUR:	I could by looking up
the .figures, but I have not them at hand. The amount can be easily ascertained by reference to the statistics. I am pointing out the amount of wheat that is taken care of in the home market. It may be eaten, used in the mills, or disposed of otherwise, but the home market takes care of it. I emphasize the fact that the home market absorbs more of our wheat than any other market-more even than the British market absorbs. In this case the home market is first in order and paramount in importance, as it usually is. I feel that any remedy to be a real remedy for our agricultural situation must recognize the fact that the basic unit of our civilization is the nation, must recognize that the integrity of our industrial life must be protected, and the growth of our domestic markets and our internal trade encouraged. In my opinion the present budget does not carry out those conditions. It appears, to say the least, to trifle with the life of the great industries of our country; it appears to extend the black hand of uncertainty toward the throat of a great many of our industrial concerns. That is a most unfortunate and a most unhappy condition, because it stagnates progress and certainly injures our home market.
In connection with our foreign exports especially our exports to South and Central America or other points through Vancouver, I wish to say one or two words on the question of freight rates. I have heard it stated that the regulation of freight rates is an inexact science, and I have no wish to take it out of the hands of those who know something about it. But there is a persistent and constant claim that the rates from Edmonton to Vancouver are out of proportion to the operating costs on that line and out of proportion to the freight rates to the east. As to that, I believe we have a special tribunal which is fitted to investigate, a tribunal which has had experience in railway matters. It has attached to it a body of experts, and there is no reason why the government could not refer the matter to them and get a report setting forth the facts, the decision arrived at and the reasons therefor which might form the basis for any proposed action looking to a change in these conditions. I think that should be done at once; we should get an immediate report on the subject. If these rates can be reduced so that the Edmonton section can get their wheat to Vancouver more cheaply, and thence to the south and other points, it will mean a great relief to

The Budget-Mr. LeSueur
a large section of our western farmers and help all parts of the West.
All these suggestions have more or less the object of helping the farmer to help himself. I believe the farmer has to keep his home market; economically his basic unit should be the nation; our internal trade should be built up and protected. One remedy for some of his difficulties should be found in an energetic propaganda to bring before the southern countries the quality of his wheat, particularly in those sections where the value of the Canadian farmer's product is not known and appreciated, and where the people are looking for and would welcome better wheat, better flour and better bread.
Following out that idea of helping the farmer to help himself, I have always heard since my early days that the farmer was the most independent of men, that he controlled his own livelihood, that his living depended on no other man. If that is not the condition in western Canada to-day, I ask, is there not some feasible scheme whereby it can be made so? Is it not possible to have some co-operation between federal and provincial governments whereby the farmer will be made more or less self-sustaining and thus be able to overcome his present difficulties? Can he not be enabled to produce his own butter, his own eggs, his own meat? It may not be a very high ambition, but it would be sufficient to carry him over the present crisis. My understanding of the situation 'may be wrong, but we do co-operate in road-building and in many other things; why not co-operate in that? Another question that might be asked is this: How far can the government co-operate in enabling some of the western farmers to shift their crop from wheat to some other line?
Mr. 'SPENCER:	May I ask the hon.
member a question? Can he give the House any information with regard to the percentage of the farmers in western Canada who, he believes, do not raise their own poultry and produce their own dairy products?
Mr. LeSUEUR:	No, I could not give the
percentage. I do not know where that information could be obtained. But I will proceed with 'the point I was going to make, namely, whether or not the farmers could shift their wheat production to some other production. I read recently a report of the Department of Agriculture of Washington setting forth the results of the efforts of the United States government in some 302 counties to bring about a shifting from wheat production to the growing of alfalfa, the raising 108
of poultry, dairying, and so on, and that report showed that good progress had been made in that direcfion. Is it feasible to arrange for some co-operation in that respect between our governments with a view to meeting the present situation?


Robert Forke: I would like to ask the hon. member a question-and I appreciate the spirit of his address. Does he take into consideration the great difference between the conditions in the United States, with 110,000,000 consuming people, and those in Canada, with a tremendous producing population and a small consuming public? Does he appreciate how much more difficult the question is to settle in this country?
Mr. LeSUEUR:	I do take that into consideration. I appreciate it and I am trying to offer some solution that will be a step toward relieving that condition. With regard to the present position of agriculture, I would just like to cite the situation which existed in the southern states. It may not be exactly applicable, but it was more or less along the same line. It was about 1830 or 1835, that the cotton producers in the southern states were experiencing a crisis of low prices and overproduction. At that time the Democratic party thought it would be in the interests of that community that they should buy their implements in the cheapest market and sell their cotton abroad, that they should have free trade or low tariffs. A compromise as to tariff was arrived at and the arrangement prevailed for some eight or ten years. Those years were not years of prosperity. War followed in Europe and there was some prosperity, but shortly after that a protective tariff was .adopted in the States and has been followed fairly consistently ever since. To-day the United States is producing about 12,500,000 bales of cotton. Of that amount about
6,000,000 bales are manufactured in the United States, about 4,000,000 of which are manufactured in the southern cotton states. That is just an example which I leave with the House.
In summing up as to this topic, I must admit that I have occupied considerable time and attempted a very ambitious task. I thank the hon. members to my left for their kindly reception of my effort. An analysis of the western situation shows that the condition there is due to this series of causes: *Overproduction, falling prices and over-ex pansion. I believe further if we are going to look for remedy, real and permanent, we have to look directly and hit directly at those causes, and I would like to reiterate, that the very nature of those causes and the very

The Budget-Mr. LeSueur

nature of these remedies must impress upon us that our basic unit must be the nation, that those ills in the West will be best combatted and overcome eventually by the co-operaition and help of our united industrial life, and that the one essential we must keep in mind in our consideration of this subject is the integrity of our complete industrial life. Now let us look for a short time at some of the points in connection with our tariff.


Mr. FANSHER:: The hon. member has argued that production of wheat should be decreased in the West and that the western farmer should enter mixed farming. Is he of the opinion that the farmers of Ontario and in the East who have largely ceased growing wheat and entered into mixed farming are today in a greater condition of prosperity than the farmers in the West?
Mr. LeSUEUR: I think it 'would be useless to draw a comparison as to degree, as to whether the farmer of the West is in a worse condition than the farmer of the East, but I would say that the whole agricultural situation of our country needs help in every possible way, and that if you help one section you help the other. As to shifting from the growing of wheat to other lines of farming in the West, I do not suggest that that should be done in a wholesale way, but it should be done simply so far as it can be carried out or needs to be carried out to meet the western situation. There should not be an extensive shifting. An extensive shifting would be impossible. It is only as a minor factor I am speaking of it.
Now, turning to a few points in connection with the tariff, let me say that I feel convinced that a great many of our divergencies of opinion are due to differences in our conclusions as to what the facts are, and if we could come more nearly together on what the actual facts are I think our theories would much more nearly coincide. I am firmly convinced that, so far as present world conditions are concerned, an adequate protective tariff is essential to the growth of a diversified industrial life for our country and for the production of that distinct type of manhood which Canada can produce and should have. I do not favour a tariff which allows any manufacturer to make excessive profits; and I believe that the rate of tariff is something which must be determined by the conditions m each particular case, and having regard to the national needs. Now it is almost impossible for any member of this House or for any minister of the government to de-
termine what rate of tariff should prevail in any one particular industry, without being in constant and close touch with that industry both at home and abroad. Half knowledge is, of course, dangerous, and I believe that this country would be wise to have a tariff commission of a scientific nature to advise as to the regulation of tariff needs. Sir Thomas White, as Minister of Finance, in 1912 brought in a bill which proposed to establish a tariff commission, a commission which would have power to investigate and ascertain costs of production, costs of transportation, costs of material, and inquire into any other matters which pertain to industrial concerns, and that the results of their investigations should be available to the House and to the ministers of the Crown. Such a tariff commission would, I believe, in making one investigation after the other, gradually accumulate and tabulate a series' of facts, gather information which would be of vital importance, and would *always prove ,a source of reliable information. If it is true that our differences are to a large extent differences on the facts, and if it is true that suspicions which sometimes arise in the minds of the public are largely due to inability to get at the facts, such a tariff commission would serve a very useful and a beneficial purpose in our national life.


Mr. EULER:: Would the hon. member confine the powers of such a tariff board as he speaks of to the making of investigations and giving advice merely, or would he go beyond that? Would their findings have any further purpose than to advise the government?
Mr. LeSUEUR: That, of course, would be a *matter for much discussion, but what I have suggested so far is only in the nature of an advisory tariff commission, leaving the responsibility with the ministers of the Crown.
There is one other matter in connection with our tariff which I should like to bring up, and that is in connection with our preference. We give to-day a preference to Great Britain. Na person can be more anxious than I am to see our Imperial relations strengthened and grow. The British Empire is to-day a group of free peoples of the same race and the same civilization, and their co-operation and efforts are to-day exercising a very beneficial and a very potent force in the world's advancement. We have a League of Nations, it is true, but I believe that the British Empire is to-day the strongest, the most solid, and the most effective League of Nations which exists in the world, and that in the carrying out of its own interests and its own development it is

The Budget-Mr. LeSueur
advancing the world's best interests. But notwithstanding that, there is no member of this group of free peoples which does not admit the principle that eacji one of its members has the right and the duty to develop its own resources and its own productivity to the utmost without considering the other; that there will be no quarrel between members of the British Empire in seeing each member develop its own production to the uttermost, and that foreign trade only helps in so far as it is subservient to that idea. In short this would mean:	Home trade first;
Imperial trade second; and foreign trade third. As to what the policy of the present government is in this matter I am unable to find out; but let me say this:	Under our present
preferential rates, goods are coming in from Great Britain and are doing serious injury to some of our industrial concerns. If I were asked to give an example of the concerns thus affected I would instance boots and shoes. It is a fact that the agents of several British concerns are visiting various parts of Canada to-day and are selling consignments of boots and shoes to our merchants to the great detriment of our boot and shoe factories. Now, if that injury is due to inefficiency on the part of our boot and shoe manufacturers then the burden must rest on them; but if it is due to differences in cost of production, or differences in wages, or other costs then, I think, our preferential duty should be changed so as to give our manufacturers the proper amount of protection and I doubt very much if the government to-day has the necessary machinery available to determine which of these conditions exist. If so, that is another example where a tariff commission would prove a very efficient and useful body.
Before leaving the question of tariff preferences I might point out that while the home trade should be first, we must not forget that Imperial trade should be second. Thus I view with some regret that the British Chancellor of the Exchequer, in his recent budget, has seen fit to reject the proposals of the Imperial conference and to provide that the McKenna duties which gave the dominions certain preferences should be allowed to lapse. If I understand British politics aright, the policy of the British Labour party has been, and is, more directed to internal and domestic affairs and pays little or no attention to Empire, not, I would say, from a spirit of hostility but from a feeling of more or less indifference to the Empire and this on the ground that the Empire is more or less of a burden and that the principle of Empire is objectionable as implying the oppression of 108jr
free peoples. But, while I feel that their present pronouncement is in greater or lesser degree due to the policy of "buying in the cheapest market," I feel that world conditions are going to force the abandonment of that policy, in whole or in part by the British 'government. I also feel and hope that as the present government in its tenure of office comes more into touch with the dominions, and is brought into more direct contact with the feelings of Imperialism and the desire for a close working Imperial trade arrangement we may see a change in its attitude as disclosed by the recent budget.
There is one other point I propose to discuss and that is with regard to our distribution system, I bring this up because I feel that possibly the government may be able to adopt some remedy in regard to it. We hear complaints about the difference between the price paid to the producer and that paid by the consumer, and to avoid properly studying the matter this situation is blamed on the tariff. I had a striking example of this brought to my attention recently. A farmer had several hogs ready for the market. They weighed about 170 pounds apiece, and the most he could get from the Toronto buyer was eight cents per pound. He went to the local butcher who said he could not buy them because he had a market for only a small portion of the animal. The farmer continued looking round and finally sold them to a butcher on the outskirts of the city and obtained, after losing about 35 pounds of weight in dressing the hogs, sixteen cents a pound. By selling the hog locally, instead of to the Toronto buyer he made a gain of $8 per hog. That situation is not, I think, the fault of the central butcher, or of the consumer, or of the producer. The fact is that when the hog is sent to Toronto the meat is cut, trimmed and otherwise decorated. It is then returned in nice shape to the central butcher. The position is that the freight must be paid from the point of sale to the city, then there is the cost of the extra trimming and decorating which the abattoir company makes, and fianlly the cost of freight back. This system has been an insidious growth. I do not know of any one particular branch which is to blame, but this system has grown to such a size that no particular man or group of men can cope with it. However, I believe that a system which is now being used in the United States could be considered by us -with profit. They have there what they call the Department of Simplified Practice. The business of that department is to co-


Mr. D. A. MACKINNON (Queens):: 1
have listened with a great deal of interest to the speech of the hon. member for West Lambton (Mr. LeSueur), and while I think that we can agree with him in regard to some of the views he has expressed, I do not think that he 'has given us an adequate explanation of the difficulties under which agriculture is labouring at the present time. These difficulties it is hard to explain; one hon. gentleman offers one explanation, and another gives a different explanation of the causes of the present unfortunate state of agriculture. The fact is that there are a great many causes to which the present situation may be attributed, one of which I think is the fact that the relative prices of things are so .uneven; t'he prices of the products the farmer has to sell are not commensurate with the prices of the things he has to purchase. The two are not compatible. Now, the question that we have to solve is, how we shall alleviate this depression in agriculture. In the United States they proposed to remedy the situation by a different means from the one we have adopted in the present budget; they decided upon protection. The farmers of the United States deemed if wise to have protection because they thought it would solve their problem for them. But the fact is that you will find in the United States to-day that the problem has not been solved and the farmers there are in as difficult a position as they were in before they passed their- high tariff protecting their agricultural products from the competition of the world. You will find in New York state, in Minnesota and in other states, that the farmhouses are boarded up just as they are in different parts of Canada. I regret to say that in our own part of the Dominion that condition prevails, and hundreds of farmers have been going to the United States. That is also the case throughout other parts of Canada, and it is due to some condition that is very hard to diagnose. The government has attempted in this way to grant some relief, and I think it is wise to make the attempt at least by reducing the tariff and abolishing the sales tax. The tariff affects our dairying, poultry raising and all the other different branches of farming. [DOT] It is a wise experiment at any rate, to make this reduction in order to see if it will help the farmers in the business which they are pursuing.
The Acting Minister of Finance (Mr. Robb), in his resolutions, proposes first to extend the British preference to some territories that are under the League of Nations and also to withdraw the preference from some others. I am not going into the particulars of that. His next resolution deals with tea, which will affect households in every part of the country, perhaps in a very small way, but this is a move in the direction of helping households to get through more economically. Other industries that are affected are the fruit growing industry, the poultry industry, the dairy industry. These are industries that we in the East have a good deal to do with, and let us hope that the reductions will be of assistance. I should like to see a little more sportsmanship on the part of those who talk of protection being increased for the benefit of the manufacturers. They realize that the farmers are in this position throughout Canada, and yet I would suggest that they be sportsmen enough to have a unity of feeling with them to help them to get out of that position. It is in the interest of the manufacturers that the farmers should progress, because the farmer cannot buy unless he is able to sell his product at a profit. He cannot let the cream of his work go away to others continually. I am reminded of a little story that I might tell illustrating the struggle that the farmer has. It is an old fable about two frogs going out one morning and falling into a large pan of cream. They struggled for some time and at last one fellow looked at the nature of the liquid and as he could not understand it, he gave up the struggle and dropped to the bottom. The other frog kept struggling along and after a while he found a little lump. He kicked and kicked still more, struggling to get out of that dish, and at last a lump of butter appeared, so he stood on the lump of butter, sprang out, and his life was saved. We need a little of that cream reserved for the farmers so that their lives may be saved. If the cream is going to be taken away from them by the railway freight rates, tariffs and taxes, they cannot make much headway and we want them to succeed.
I wish to refer to the amendment moved by the leader of the Labour party (Mr. Woodsworth). I am in favour of one part of it, that is in regard to the inheritance duty. I think it is the most equitable system of adding to the revenue that the government can adopt, and my reason for saying so is this-and I have studied the philosophy of the matter-that when people accumulate large estates and do so under the legislation that we pass here, it is right, when they pass away, that the country where this money has been earned should in some way receive com-


Robert Forke: If I had a little money I
would be down there.


Donald Alexander Mackinnon: Well, you would find our sea trout unexcelled. We would like to have some of you make a visit to the island during the summer in order that you may enjoy a healthy dip into the breakers on the north shore. It is a country that will go ahead; the production was better last year than it had ever been, but what is missing is an adequate price for our products. Our position is something like that of the West, where there was a very large yield but not enough realized because the price was wrong and freight- rates were too high. We are in the same fix. It is not the fault of the present government, mind you. It was under the former government that the freight rates were made so high; it was under the former government that the Crowsnest pass agreement was changed and the rates put up. You remember how we were criticized in respect to the Crowsnest pass agreement the year before last; we four members from Prince Edward Island were denounced for voting for the legislation then introduced. But what has

The Budget-Mr. Mackinnon
happened? The return to the Canadian Pacific since the restoration of the old agreement has been better than if was during the period when the suspension was continued. It is well that we should have these facts in mind, because we have been accused of losing to the Maritime provinces $17,000,000 by our vote in favour of the restoration of the Crowsnest pass agreement. Men like Mr. Beatty and Mr. Hanna predicted that they would lose millions by the change, but it turned out the very opposite; their judgment did not happen to be right.
I have referred to this matter of freight rates because it affects us a great deal. We pressed very hard to get the freight rates reduced, because our people were carrying their goods with horses owing to the fact that they could not afford to ship by rail. The railway returns in the Maritime provinces have not been good, simply because the people are .too independent to ship by rail when they have to pay such high freight rates. The new board made some reductions very soon after their appointment, and the situation improved accordingly. But we cannot hope to have the country prosper unless our workshops are kept going and unless we have easy and cheap means of conveyance from one place to the other both for goods and for people; I think that goes without saying. These are the greatest drawbacks that affect us down there. Special rates for tourists would be appreciated.
I wish the Minister of Railways (Mr. Graham) were here. I had intended to bring a matter to his attention, but perhaps the Minister of Justice (Mr. Lapointe) will do it for me. We have a good many people leaving our province. It is proposed to spend a considerable sum for immigration. There were two little branch railroads proposed and agreed to both by Liberals and Conservatives in this House as far back as 1911, the New London and Rustico branches. Plans were prepared and sites allotted for buildings and so on, but the work was never gone on with. In New London we have people whose fathers or grandfathers came from Scotland a hundred years ago, and in Rustico we have the descendants of French Acadian settlers. It is two hundred years since the first settler went into the Rustico district. What I ask the Minister of Railways, through the Minister of Justice, is that while he is providing for the settlers in the new districts in the West by twenty-six branch line resolutions he should not forget the descendants of the old settlers in the districts I mention, who have been there for 100 and 200 hundred years. Let him give us these branch lines this coming summer so that

we may have a celebration and the return of our own people.
Yesterday a man well known in public life who came from Prince Edward Island passed away in the person of the late Chief Justice of Canada, Sir Louis Davies. He was highly honoured in the province and in Canada as a whole; his career was long and honourable and an inspiration to the young men of the province. Undoubtedly his field was larger than it would have been had he remained in the province and practised law, but his illustrious career is only one instance. Go to another room in this building and you will find Sir Robert Falconer and the Reverend Doctor Pringle who came from Prince Edward Island, fighting on one side of the church union question, and on the other side the Reverend Doctor Fraser and one or two others. Doctor Pidgeon is a descendant of the Pidgeons of New London, Prince Edward Island. I mention these simply as instances of men now in the struggle who came from the province by the sea. Had they remained down there they probably would have worked at farming or something of that kind, but their education was good and they have gone out to other parts of the continent. You find them from California to Massachusetts and all through our western country-workmen, clergymen, doctors, lawyers and judges. I could give you the names of many who have gone out and have attained eminence in different parts of the world. I will mention just two others, if you will permit me; one is J. Gould Schurman, who grew up on a farm in Prince Edward Island, was president of a university in the United States and to-day is ambassador for the United States in China. Another was Franklin K. Lane, who was a distinguished member of the cabinet of President Wilson during the war.
I do not mention these things in a spirit of boasting; I am simply pointing out that although the place is small it is turning out .men who have proved their worth in other parts.
We have fewer people there by ten thousand than we had when we entered confederation, but we are not inclined to secession; we believe in standing by the union; we believe in Canada going ahead. But we cannot get population without industries. There is a splendid opening for industry in Prince Edward Island if the capitalists would, instead of concentrating their activities in large centres, establish branch houses in other parts of the Dominion. I admit that the practice of concentrating in the large centres

The Budget-Mr. McConica
is good from the point of view of foreign trade, but it is ruinous for our local industries. Many of our sons have gone out to the world, so that part of the intellectual force of the island has been spent in other provinces and countries, and although we do not have the benefit of it, I think it is well spent and that we have no reason to regret it.
Mr. T. H. MeCONICA (Battleford):	Mr. Speaker, I have no disposition to prolong this discussion, but there are a few observations that I should like to make. To my mind this budget and the amendment offered by the hon. member for Kent (Mr. Doucet) raise a very important issue in Canada today, the question whether the future fiscal policy of Canada is to be a tariff for protection or a tariff for revenue.	That, it
seems to me, is the issue. That is where we stand to-day as a parliament and as a country. Now, for my part, if that issue is fairly joined, I would take my position in favour of a tariff for revenue. We have had a good deal of talk about free traders, but there is no use discussing this question except as it stands. I do not think any one in this House to-day is in favour of putting this country under free trade at any time in the near future. We believe in a revenue tariff, with such incidental protection as that affords.
Now what is a protective tariff? It is a tax levied for the purpose of protection. It is levied for the purpose of taxing the many to protect the few. It taxes the money out of the pocket of one private individual into the pocket of another private individual, and I do not think that is the proper function of government. I deny that a government has the moral right to say to one man: I will 'help you, and I will do so by hurting your neighbour. That is what protection is when you reduce it to its final essence. Now what excuse is there for this proceeding? What good end is obtained by this discrimination between our citizens, for that is what it is? It is taking from one and giving to another, for what purpose? Why, the hon. gentleman says, we will be able to build up the home market; that is the great desideratum. Well, in the first place, can we do it? In the second place, what does it amount to if we can do it? So long as the price is the same, I cannot see that it makes any difference to the man who sells whether he sells in the home market or abroad. There may be some sentimental reason why he would prefer to sell at home; perhaps he would like to bring in people to associate
with him and to whom he could sell, but so far as the money that goes into his pocket is concerned, I cannot see that there is any difference between the home market and the foreign market. So far as bringing relief, for instance, to t'he wheat grower of the West is concerned, there is no difference.
Take our wheat. Our price is fixed in Liverpool, and the Canadian consumer pays the Liverpool price, less the cost of sending the wheat to Liverpool. The producer in western Canada realizes exactly the same price in both cases, and it makes no difference to him financially whether the wheat stops in Ontario or goes on across the water. So as far as relief is concerned, the home market is not of any particular consequence. Suppose we bring people in here. Well, the price of our wheat is fixed by the world price, and if we could transport enough people to Canada to eat our wheat, they would not eat any more wheat here than they would if we left them in Europe, would they? Not a bit; perhaps not quite as much, for there I understand the ration is a bowl of soup and a loaf of bread, while over here we have meat and potatoes, vegetables and fruit and everything else, so I think they would eat rather more wheat on the other side of the water. So far as a market is concerned, this home market is a myth.
Another thing: We are raising about 300,000,000 bushels more wheat than we consume. We raised last year 470,000,000 bushels, and we eat about 50,000,000 bushels or a little less than that. A man eats between five and six bushels of wheat a year, or about
50,000,000 bushels for eight and a half million people. We also sow about 50,000,000 bushels a year, or a little less than that. We have at least 300,000,000 bushels of wheat to ship abroad. Now suppose we tried to consume that wheat at home; 300,000,000 bushels divided by six means 50,000,000 people to bring in here to consume that wheat, and not one of them would be raising wheat. What would they do? That is the question. If we build up this home market they talk about, what are we going to do with these 50,000,000 people? Are they going to manufacture? Where will they sell their stuff? The hon. gentleman says that we should be self-contained; we should live on what we produce. Now we can produce enough to keep ourselves and still have a large surplus. What are we going to do with it? Send it abroad? We are self-contained, we are raising what we need and we should send our stuff abroad; load a shipload of our products, send it to the markets of the world and

The Budget-Mr. McConica
sell it, and bring back a shipload of money; then load another ship and bring back another shipload of money. But how long could we keep that up? We would not get three cargoes out of this country till they would say:	We
will buy your stuff if you will b.uy ours; our money is all gone. Yes, Mr. Speaker, we must depend for our foreign trade on our ability to buy foreign goods. There is no other way of doing business, and we cannot build up a foreign market unless we buy abroad. Fifty millions of people brought into Canada and engaged in manufacturing or any other vocation you could put them at would not eat a bit more wheat than if they had stayed in Europe. We would not have a market for an additional bushel.
The hon. gentleman says we are producing too much wheat. Well, they are buying all we send to them; they take all we produce. He also says the price is too low. But the price is not going down; it is as good this year as it was last. That is not saying much for it, but that is the situation. He also offers very good suggestions as to how we can relieve our farmers. They should not produce so much wheat, he says, and they should sell at a better price. But how are you going to get a better price? Then he says we must go into other lines of farming. Now what other line, I would like to know? I am a farmer and I am ready to shift to some other line. I have shifted to other lines, and it does not pay. There is nothing else that can be suggested for a farmer in the West to engage in. Talk about the dairy business-we cannot compete writh eastern Canada in that. Why Our cows are practically all dry fed for ten months in the year. We have a little fresh grass for feeding purposes along about the beginning of June, and then it dries up and our cows are practically fed on hay for the balance of the year; they give scarcely any milk. We cannot manufacture dairy products and compete with the farmers of Ontario and Quebec, even if we were as close to the market as they are. We are told to go into some other line, go in for raising cattle. I have raised cattle; I am raising cattle now. It takes ten acres of our prairie grass to keep a steer. That ten acres will cost $200. At 8 per cent that is $16 a year. You can summer the steer on that ten acres but then you have got to winter him. Sixteen dollars a year for three years. That is $48 and you will do mighty well if you can sell him for $30. That is the cattle business. We are told to go into some other line. I want to say to you that the other lines are worse than wheat, and I have tried 
a good many of them. We are told that the aggregate reduction in the price of agricultural implements is not going to help us much. The reduction will not help us a whole lot, but it will help some. The hon. gentleman to my right (Sir Henry Drayton) told us that we would only save about $750,000 by this tariff reduction on agricultural implements.


Henry Lumley Drayton: Altogether, and you get only a little bit of it.


Thomas Henry McConica: Well, it is not so much the revenue, it is the bounty we pay to the manufacturer. Then the hon. member for Brantford (Mr. Raymond) said " Why the farmers of the West need not complain about their agricultural implements because the member for Brandon (Mr. Forke) says they are not buying any implements." That is true, they are not buying implements to any great extent. They are, Mr. Speaker, using old worn out implements, and there is not much economy in it. It is the worst waste they can be guilty of to drive a poor seeder across a field and probably lose two or three bushels per acre when if they had a good machine it would pay for itself in a single year. It is the same with a binder that does not work well. If you had an efficient machine you would soon make up the cost. The reason the farmers are using old machinery is not because they are economical but because they have not the money to buy the new machinery which they need. The farmers of the West have got to the position where they have to save every dollar, or not spend money that should be spent, in order to make their operations profitable.
Hon. gentlemen to our right have told us that the tariff is the great panacea. They *ay ' Take the United States. It has become rich and opulent because it has a protective policy." Well, as another hon. member very truly said, the United States has become rich and opulent in spite of its protective tariff. The republic to the south is in a very different situation to Canada. The United States is practically a world by itself. It is a self-contained nation. It has a diversity of products and climate. It produces practically all it consumes, and consumes practically all that it produces. Its foreign trade does not amount to anything to speak of-that is from a percentage basis.
The states of the Union trade among themselves. The cotton raiser sells to the north, and buys from the north, and so it is. Over there they supply their own wants, manufacture for their own industrial needs, and

The Budget-Mr. McConica
their exportation of commodities is very little. I have here a statement from the United States Minister of Commerce, the Hon. Herbert Hoover, in an article entitled "Economic prospects of 1924" in which he says: "Less than 6 per cent of our total production is exported." Loss than 6 per cent! It is a free trade nation, a nation that trades with itself. There are no trade barriers in the United States. He also says "Less than one per cent of our manufactured products find a market in Europe." So it is a great free trade country. Thirty-five or forty years ago the manufacturing was done in the New England states. They had a tariff' but no internal tariffs. The factories were old and well established, and well financed and managed. They were located in Massachusetts, Connecticut and the eastern states. They had all the advantage of mass production and everything. They had, according to the theory - of our protectionist friends, the best of the situation down there. Take Fall River, Massachusetts. It was the centre of the cotton manufacturing industry. They had great mills there that were supplying the world's market. They controlled that market. They thought their climate was the only climate in the United States where cotton could be manufactured-just the right amount of humidity they told us and just the right temperature, and so the only place where cotton could be manufactured. What happened? They started to manufacture cotton down in. the southern states. Free trade! Why in New England they thought they were right in the position to kill out those fellows who started down there. According to the theory of the protectionist they could just crush them like an egg shell. To-day, as an hon. member stated here, four million out of the six million bales produced are manufactured down below Mason and Dixon's line.
What is true of the cotton business is true of every other line of manufacturing in the United States. The great manufacturing establishments of the United States are in the West, not in New England. They have been started and built up in the central and western states where there are great hives of industry. That is where you find the manufacturing trade of the United States, and it has all grown up in the last thirty-five years under free trade conditions. Now, if they can do that over there why can they not do it in Canada? They tell us that fortunes have been made down there. It is true. Probably the most successful manufacturing establishment in the United States is the Standard Oil Company. I apprehend it is probably the most successful enterprise
the world has ever seen. It took a comparatively unimportant product, a hatural product, a product that is found the world over


Henry Lumley Drayton: Do not forget
Ford and the tin Lizzie.
Mr. MeOONICA: -and they manufactured that into a commodity that is used generally,, for which there is a universal demand. They work that product up into a hundred different commodities to-day; it is the most closely manufactured article in the history of the world. That company have paid good wages and have never had a wage strike in their entire existence. Still they have competition. There are hundreds of other refiners and thousands of independent producers, and yet they have built up fortunes fabulous in amount. Their directors are founding colleges, financing great enterprises, and establishing hospitals. It is a wonderful business which has never had a single farthing of protection, and what it has done other companies can do. It has stood firmly on its own feet and has done business with the whole world. It has met universal competition and ias held its place in the trade of the world, so that its products are to be found wherever there are people to buy them. I repeat, this great enterprise has grown up without the slightest protection. -Now, why cannot Canada do the same? Here we are with boundless natural resources, with our own food supply at home, and with the cheapest and best power in the world. We have a great inland system of waterways that gives us access to the markets of the world at cheap rates, and we have a class of workmen as intelligent, as industrious, and as efficient as can be found anywhere. Yet we cannot compete at home, we cannot compete abroad, we cannot compete anywhere. After fifty years of coddling, and nursing and boosting, our manufacturing enterprise is so frail and wobbly that it is crushed with a shadow. That is the situation. Why, an hon. member yesterday told us that the agricultural implement business was ruined entirely; whereas before a $100 implement was fisted at $95, paid $9.50 tariff and was sold for $104.50, to-day, under our present arrangement, it was going to be listed at $100, with a tariff of $6 and would sell for $106. Our implement dealers, he said, could not stand the competition and were going to be ruined. Imagine, $1.50 of a rise in price and it spells ruination to our home industry. That sort of competition means their destruction, their annihilation. I do not understand the logic of it; at least that logic is a little involved.

The Budget-Mr. McConica
I am not in favour of the proposed amendment (Mr. Woodsworth). There are some things in it that I like, but as I understand the proposition, it seems that we are to condemn the government or at least to vote a want of confidence in them. Now, we are not trying to improve their budget with the amendment. If this amendment were carried it would not change the budget but would simply be a vote of lack of confidence in the administration. That is all it would be. And having voted for the amendment declaring a want of confidence in t'he government, ten minutes later we would vote for the budget and so sustaining the government that we had no confidence in! I do not want to put myself in that position; I do not believe that it is a position which we ought to assume as a party over here. I should have preferred to have seen a square issue between the proffered amendment of the hon. member for Kent, N.B. (Mr. Doucet), and the budget as it has been brought down.
I congratulate the Acting Minister of Finance (Mr. Robb) upon his budget speech and upon the underlying principle of it. I accept the statement that has been made, that the question is as between low tariff and high tariff, and I am for the low tariff. The fight is on, and I say to my hon. friends to my right, "We will meet you at the next election on that issue and will trim you."


Henry Lumley Drayton: Wait till we
get at you.


Thomas Henry McConica: At any rate, the question is one which we want to have settled in Canada. We should approach it in all candour and there should be no political jockeying about the matter. It is a square business proposition: Can we tax ourselves rich or can we not? For my part I am in favour of the reduction of the tariff as gradually as is feasible, without disturbing industry over much. At all events, I want to see a firm, persistent and well carried out programme of tariff reduction here in this Canadian country of ours.
At six o'clock the House took recess.
After Recess
The House resumed at eight o'clock. PRIVATE BILLS



CONSIDERED IN COMMITTEE-THIRD READINGS

[Stage Direction]
Bill No. 15, respecting the Canada Southern Railway Company.-Sir Henry Drayton.

Bill No. 16, respecting the Detroit River Tunnel Company.-Sir Henry Drayton.


Mr. T. J. STEWART (West Hamilton):: 
George Perry Graham: A bad precedent, but we
do not mind.


Henry Lumley Drayton: You did it already this year.


Mr. STEWART (Hamilton):: 
George Perry Graham: I do not think there will
be any objection to that.


Hewitt Bostock: If the House consents.
[The letters handed in are as follows:
The Brown Boggs Co., Limited
The writer feels certain that you are well aware of what a misfortune it would be to Canada if this proposed legislation goes into effect. While most of the changes do not effect this company directly, indirectly it will have a very serious effect, when you consider the large number of manufacturers of agriculture implements and saw mill and mining machinery operating in this ^country.
These people are among our customers, and we probably sell 25 per cent of our product to them. If they are working under a handicap, and their business shrinks, it is only reasonable that' our trade with them will be cut off, as no company will purchase new equipment unless they are expanding or prospering. This will also react of necessity on other manufacturers
from whom we purchase our raw materials, as our volume of business will be lessened.
The working-man will also feel the effect of this curtailing of production, and necessarily the merchants from whom they buy.
We will suffer from U.S. competition as some of the largest manufacturers in this country are branch concerns, and will be able to import considerable of their products from the parent factory in the United States where they can manufacture certain lines more cheaply than in Canada, owing to the greater production.
The preferential tariff on English goods interferes with us directly to quite an extent as it allows goods made in England under a much lower wage rate than we must pay, to come into Canada and under-sell us.
Then, as you are aware, Germany is making great efforts to get a foot-hold in this country, and is advertising very extensively here now. When one considers the difference between what the German workman can live on and what the Canadian workman has a right to receive, it is not hard to understand how they can ship goods in here and sell them at less than our actual cost.
The "Dumping clause" which was put into force some years ago had a good effect at one time, but the writer doubts very much if it has been enforced recently.
Yours very truly,
The Brown Boggs Co., Ltd.
April 24, 1924.
The Ford-Smith Machine Company Dear Sir:-
We wish to draw your attention to the anxiety with which we view the proposed tariff changes now before the House. We are not manufacturers of agricultural implements, and we are not directly affected, as far as we can see at the present time, by these proposed changes, but we are indirectly very greatly affected, and view these changes with great alarm.
This company designs and manufactures machinery, dies, jigs and fixtures which are used by other metal working plants, including implement manufacturers, and anything that affects them, naturally has its consequent effect on us, and our employees.
This company located in Canada well aware of the disadvantages of a small market, and with a full knowledge of the growth of the machinery business in United States under their protective tariff. Had we ever thought that it might be that this tariff would be reduced materially, we would have considered it business suicide to locate a business of our nature in this country, and we would not have done so.
If the present tariff changes go into effect, though it is difficult for us to estimate our loss of sales and employees, because there are many other industries whom we serve and who themselves will also be indirectly affected, we would say that this legislation might depress our sales from 25 to 40 per cent, causing us to lay off skilled mechanics to this extent.
You no doubt have heard in a general way about our mechanics leaving for the other side, but if you were in touch with the situation as we are here, you would get a shock that would surprise you. I am sure that this condition is not properly appreciated in Ottawa. The present position is that we are training young men as apprentices in our technical schools built at tremendous public expense, for the benefit of the United States manufacturer. It is not idle talk, but is the plain statement of facts, that the opportunity for a skilled man to-day is across the line. Our largest competitor is of course the United States manufacturer. It is only by the most strenuous efforts that we are able to compete even at the present time, and if the present advantage of the tariff is

1710	COMMONS
The Budget-Mr. Stewart (Hamilton)
reduced, it is very problematical whether such people as ourselves can stay in business in this country.
We cannot impress upon you too strongly the seriousness of the present situation, and we would repeat in conclusion that if this country has to be a manufacturing as well as an agricultural country, that we shall have to have a proper measure of protection till such times as our Canadian quantities are large enough to allow us to specialise in the same way as our foreign competitors; and we would again point out that the strong home competition will insure the proper prices to our consumers.
Yours truly,
The Ford-Smith Machine Co., Ltd.
April 21, 1924.
The International Harvester Company
F. M. Morton, general superintendent of the International Harvester Company of Canada. Limited, Hamilton branch, issued the following statement, regarding the situation arising from the new budget tariff.
" The situation produced by the new budget tariff is a matter of grave concern to the International Harvester Company of Canada, Limited. We do not see how the lowered duties can fail to have a serious and prejudicial effect upon the companj''s manufacturing operations at Hamilton and Chatham. How serious only the future can tell. All we can say is that the company will do its best to meet the situation and keep its plants in operation so long as tariff laws and business conditions will permit. This will be done not only to protect the investment of the stockholders, but the means of livelihood of its employees and their home investments made in the belief that Hamilton and Chatham would continue as prosperous manufacturing communities, assured of encouragement by the country at large.
In the same way as the prosperity of these communities is bound up with that of the industries located in their midst, so in a larger sense the prosperity of the farmers of Canada is also affected. They cannot profit in the long run by making unprofitable the industries which have heretofore supplied their needs. The future of Canada must depend on the mutual prosperity of agriculture and industry, just as in the United States the prosperity of the country has been dependent on the prosperity of these two activities.
We hope the farming communities will come to recognize this relationship and insist on fair treatment to industry, not only as a matter of justice to the investors and great number of their fellow-citizens employed as workmen therein, but for their own enlightened self-interest.
International Harvester Co. op Canada Limited. April 17, 1924.
Dominion Sheet Metal Corporation, Limited
For the past several years our main competition has been against the United States producers, where a duty of 12 1/2 per cent is somewhat assisted by average United States exchange rate of one to three per cent.
Now, however, the import competition has swung around almost entirely to the British sheets with their low labour cost, and the 7 1/2 per cent duty on galvanized sheets from United Kingdom is entirely wiped out by the present depreciated English currency, being about 10 per cent or more below the Canadian par.
You will thus see that the man who buys galvanized sheets can take the money with which he would pay us and can pay the 7 1/2 per cent duty and have 2 1/2 or 3 per cent left over when buying the English sheets.

We are the only concern doing, this work in Canada, and have had a very difficult time for several years but finally have the industry pretty well established, but it is only on account of an efficient organization and low overhead cost that we are able to compete at all and that in a restricted district.
We sincerely hope that something will be done in the way of adding a certain amount, based upon the per cent of depreciation, this amount to be added to the duty, as it seems only fair to us that this duty being figured on a normal value of currency from the exporting countries should be increased when their currency becomes depreciated; otherwise the original intent of the duty is not being carried out.
We and our entire staff and force of employees, together with co-operation industries furnishing us with raw materials here "would certainly appreciate some release from this situation. [DOT]
Yours very truly,
Dominion Sheet Metal Corporation, Limited. April 17, 1924.
Collins, Never-Fail Products, Limited
We are producers of a line of poultry raising supplies including incubators and brooders, as well as a line of spraying equipment for use by horticulturists.
In view' of the new' changes in the tariff we have decided to suspend the manufacture of brooders and incubators as well as the sprayers with one -or two small exceptions, and to import these and job them.
This will cut our expense down because we will dispense not only with a considerable number of workmen but some of the office staff as w'ell, and the small jobbing profit will be one we can depend upon rather than take a chance on a larger manufacturing profit.
Might say for your information that last year under the old tariff we came within a few dollars of breaking even, sustaining a slight loss on the manufacturing of the incubators and brooders and the spraying equipment, and this year wre w'ere hoping for an increase in the demand and an opportunity to make a profit, but' in view' of the change we have decided to suspend manufacturing and go into jobbing, selling U.S. lines, which we are able to import now at less than we can manufacture.
This comprises about half our manufacturing operations and we pay out from twelve to fifteen thousand dollars a year in labour, and four or five thousand dollars a year in clerical and staff payroll, and this will be cut in two.
The worst feature in our estimation is the fact that instead of progressing and growing we will now' be entirely obliterated as far as the Canadian industry is concerned, and we are quite sure that if we cannot manufacture at a profit no one else can in Canada.
Yours very truly,
Collins, Never-Fail Products. Limited.
April 17, 1924.
P. B. Yates Machine Company Limited
We are greatly concerned and apprehensive as to the general effect tariff reduction is having and will have on business at large in Canada. .
As a result of the war, a greater number of diversified commodities have been produced and can be obtained in the Dominion, with the result that 99 per cent of our purchases have been made in the home markets, and 90 per cent right here in Hamilton, a thing not possible prewnr.
With assurance, under a stabilized tariff, have been able to measure the future w'ith some degree of confidence, resulting in investment of our money in materials and labour, in other words, building up stock against future prospects, thus creating markets
MAY 2, 1924	mi
The Budget-Mr. Stewart (Hamilton)
for materials and keeping labour employed over low business areas.
To meet conditions which the lowering of the tariff and increase in British preference has brought about, we must seek the lower or cheaper foreign markets that are thrown open to us to the exclusion of our home markets; if that situation exists with us it also affects hundreds of others. That is the condition we are apprehensive ol, we live with and upon each other, -what affects one affects all.
There was such a reversal of business in our line, during the interval the Speech from the Throne to the time the budget was brought down, as to result in a complete change in our producing policy.
There is not that confidence in the future facing us as to warrant our taking the financial risk in accumulating material and keeping labour employed, only as can be applied to actual orders in hand, resulting in our having to lay off a number of men and curtail hours of employment, of the balance, to 30 hours per week, and material purchases.
This not only adds to the unemployed, it means the loss of our and their purchasing power, further loss to the city of Hamilton and to the Dominion.
From a beginning in 1907 to a business in 1911-12-13 giving employment to 380 under the stabilized tariff of the Laurier government to a dwindling to 96 employees under a shifting tariff of the King government, the like of which we have not had in our career of 17 years.	*
The increase in British preference has thrown open to English competition a market for machines, under Item No. 453-B, that they have heretofore not been able to enter, competition in respect of wages paid, hours worked and cost of materials we have little hope of meeting. We know what this competition is, as we have learned from our losses in Australia, and competition which Australian manufacturers are complaining seriously of to their own government.
The attention of the government has been called to the fact that Canada alone has seen fit to reduce her tariff, the results of which are fast becoming apparent in comnarisnn to ftp '[DOT]ov.ntry tc the south us, wiLh its protective wall against us and our western contemporary, "the Farmer", in particular.
On the one hand our government is spending money to increase immigration, while that to the south is spending money to keep it out, except our own favored artisans and mechanics, no quota is placed against them; there is, however, a tariff,
Item-Homan beings, $8.00 per head.
Money will go where business is to be had, and employment and immigration will follow; every restriction, every obstacle placed in its way will cause it to flow in the opposite direction, and those obstacles are now placed with the adoption of this budget which are going to be felt, not by the individual, not by a faction, not by a section, but by all the people and our country as a whole.
Yours truly,
P. B. Yates Machine Co. Ltd.
April 24, 1924.
Imperial Cotton Company Limited
April 19th, 1924.
On the basis of our sales to the agricultural implement manufacturers during 1923, our future annual sales will be reduced over ten per cent and our yearly production will be decreased approximately twelve per cent; which, in terms of our personnel, would affect about thirty-five employees, whose earnings aggregate over $30,000 per annum.
By the terms of the proposed reduction of tariff on materials supplied the agricultural implement manufacturing industry , our protection as against the United States will be cut twelve and one-half per
im	'
cent, whereas England will now have a preference over us, on the present rate of exchange, of at least three per cent in the Canadian market; and other countries with depreciated exchange will have an opportunity afforded them to offer severe competition.
Under the present method of assessing duty on depreciated exchange from foreign countries, it is now a hardship to compete with the protection afforded us by the present tariff and, in many instances, we are obliged to accept business at a distinct loss in order to hold the trade which we have endeavored to build up over a period of nearly twenty-five years.
While we are a small industry comparatively, a substantial portion of our production is sold yearly to the manufacturers of agricultural implements-very largely on a quality basis, as their specifications are exacting. There is thus no opportunity afforded us to meet the additional competition which the proposed tariff changes will invite by lowering the quality of our product through utilization of waste or by-products.
Yours very truly,
Imperial Cotton Co., Limited.
April 19, 1924.
Bird & Son Limited
Owing to the restricted purchasing power of our customers which has shown itself during the past few months, and particularly during the past one or two months, we have been forced to reduce the number of employees to a lower point than at any time during the past six to eight years. An investigation leaves no doubt in our minds that the cause is nothing else except a lack of confidence in the fiscal Policy of the present government.
While our business is not directly affected by the proposed tariff reductions in the budget recently handed down, nevertheless it is already apparent that these reductions will reduce the number of customers by emigration from Canada to the United States, and that the earning and spending power of those cus-tcrr.crG	i cumin in Canada will be materially
reduced.
Based upon the present outlook therefore, we can only anticipate lower production in our plants and consequently- higher costs, all of which will place United States manufacturers of our lines in a stronger position to take a larger share of the business which would otherwise come to our own plants and other plants similar to our own in Canada.
The employees of our plants both here and in Quebec are consumers of the farm products of the surrounding districts, and it is not only probable, but almost certain that as the purchasing power of our employees decreases, the sales of the farmers in the surrounding district will proportionately decrease.
Yours very truly,
Bird & Son Limited.
April 25, 1924.
Stanley Steel Company Limited
We are drawing to your attention the charges in tariff as brought down by the recent budget, and how it will affect our business.
We- have been manufacturing cold rolled steel for * implement manufacturers for some years. This change in the tariff means that not only do we lose the tonnage that we have been selling the implement manufacturers, but the labour that they are employing in manufacturing parts from the steel we sold them, will be gone, as it is now cheaper for them to bring these parts in from the States in a manufactured condition, the tariff arranging for their entry on the free list.
Our production will be considerably affected by this change, and if similar changes are on the programme,
1712	COMMONS
The Budget-Mr. Stewart {Hamilton)
it means that the number of our employees will be decreased.
We also wish to point out that on cold rolled steel being imported into this country for export work, there is a draw-back on this material of 99 per cent. We are forced to pay the government, on 12 gauge and heavier (hot rolled steel) that we import to cold roll in Hamilton, a duty of $7 per ton. This duty which we pay, is again paid out by the government to concerns who are bringing in their cold rolled steel from the States on a 99 per cent drawback basis.
You will agree with us that this is not a fair condition. It is a hardship imposed on Canadian manufacturers who have started plants in Canada, since these items were put on a draw-back basis by the government. If we are to employ labour, pay taxes to the government, and build up this country, is it not possible to get some relief, to allow us to increase the number of employees on our pay-roll, and be in a position to pay them wages which will ensure their staying in the Dominion of Canada?
Yours very truly,
Stanley Steel Company Limited.
April 17, 1924.
National Steel Car Corporation, Limited
I might draw to your attention the fact that tariff item No. 453-B, among other things, includes logging cars, the general tariff on which has been decreased from 30 per cent to 20 per cent.
The writer happens to be president also of a car company in the United States, who are probably the biggest logging car producers in that country, and whose patents are based on steel constructed logging railroad equipment. Steps have been taken to give this National Car Corporation here in Hamilton the use of these patents and construction details, and the writer recently returned from the Pacific coast where he looked over the logging operations in that section of the country.
Of course, this action of lowering the tariff is much more detrimental to the development of Canadian industry, and particularly Hamilton, than it is to the investors and owners of this corporation. It will simply mean that business will be done through this company instead of by it. It will mean, however, loss of payroll for the workmen, and loss of purchasing power for the many things required to maintain operations, to say nothing of the purchasing power of the workmen's families.
Yours very truly,
R. J. Magor,
President.
April 21, 1924.
E. T. Wright Co. Limited
With reference to the tariff reduction budget of 1924, beg to state that this budget hits us very hard. Business was bad enough before, without a reduction in tariff, but now we are cut out of a lot of business. It is hard to know where it is going to finish.
They are trying to pass' through all sorts of tinware as kitchen ware and hollow ware at 20 per cei t, whereas it should be 25 per cent.
We note that shovels come under the "free" list. We make fire shovels and snow shovels.
We also make a line of dairy pails which they are trying to pass in as farm implements.
In affecting the farm implements it affects us very materially, as we supply these companies with large quantities of oilers, etc., and where it breaks up their business it also affects ours.
We sincerely trust that there will soon be something done to stabilize a trade policy in Canada

which will encourage industrial business. To-day it is impossible to get any new capital invested in the industrial business.
Very truly yours,
E. T. Wright Company, Limited.]
April 28, 1924.
I now wish to read a statement showing the reductions that have taken place in tht staffs of a number of Hamilton industries in the period from 1920 to 1923. Not only does this statement illustrate the unfortunate results that have already occurred but it serves to show other changes along this line which may be expected in future if reductions of the tariff are continued1:
Branches of American Industries Manufacturing in Hamilton
Employees
Name and Address	1919	1923American Can. Co., New York, N.Y...	300	175Beaver Motor Truck Co., Chicago,	11..	100	...Bird & Son, Ltd., East Walpole, Mass.	75	50Can. Libbey-Owens Sheet Glass Company, Charleston, W. Va	
200	...Can. Hoseshoe Co., Erie, Pa	
100	80Can. Westinghouse Co., Pittsburg,	Pa.	3,000	2,500
Chipman-Holton Knitting Company,
New York, N.Y	 588	400
Dominion Belting Co., Cambridge,
Mass	 100	50
Dominion Foundries & Steel Limited,
Buffalo, N.Y	 2,500	400
Frost Steel & Wire Co., Cleveland,
Ohio	 200	100
Firestone Tire & Rubber Company,
Akron, Ohio	
500	250Imperial Cotton Co.,	
300	200International Harvester Company, Chicago, 111	
2,500	300
International Plow Works, Chicago,
111	 1,500	150
Laidlaw Bale Tie Co., Ltd., Kansas
City, Mo	 160	80
Meriden Britannia Co., Ltd., Meriden,
Conn	
200	100National Fireproofing Company, Pittsburg, Pa	1.	100	60
National Steel Car Co., New York,
N.Y	
1,500	1,200Norton Company, Worcester, Mass..	100	40
Otis-Fensom Elevator Co., New York,
N.Y	 750	200
Parson & Parson Can. Co., Cleveland,
Ohio	
100	50Proctor & Gamble Mfg. Co., Cincinnati, Ohio	
400	200Robinson Paper Box Co., Chicago,	111.	25	...Standard Underground Cable Co., Chicago, HI	
200	100
Stanley Steel Company, New Britain,
Conn	 100	50
Union Drawn Steel Co., Ltd., Beaver
Falls, N.Y	100	40
P. B. Yates Machine Company, Beloit,
Wise	 250	120
I have taken up more of the time of the House than I bad intended, but I feel very
strongly that this country has reached a crisis. Under the National Policy of Sir John A. Macdonald and the reasonable protective policy of Sir Wilfrid Laurier, this

The Budget-Mr. Fajard
country grew and prospered. American industrial capital was attracted here by millions, and apparently we 'are now going to say to these Americans:	"Take your
capital back across the border and manufacture at home and we will throw our market open to you. We will send you our raw materials and our brains and our brawn and we will buy from you, at whatever prices you may care to dictate, the finished products they turn out while you close your door to our wheat and the other products of our soil." Have our Liberal friends so soon forgotten the proposed reciprocity pact that sounded the death knell of the Laurier government? Even under that agreement we were to get something in return for what we gave, but the present Prime Minister (Mr. Mackenzie King) and his government, in the largeness of their hearts, would give all, even of our rich heritage, and ask nothing in return from our American neighbors, not even a mess of pottage.
Before I sit down I want to ask the government to consider the budget carefully before putting it into effect. I am well acquainted with the manufacturers in the city of Hamilton and while I know that there are some firms that are making between 5 and 10 per cent, I can assure the blouse that they are only a very small minority; the large majority of the manufacturers in that city are not able to do more than come out even. I believe, as a matter of fact, that if the balance were struck as between all the profits which the manufacturers in Hamilton make and the losses that are sustained by others it would be found that the average profit would not amount to more than 3 or 4 per cent. That being the case, what will happen if the budget which the Acting Minister of Finance (Mr. Robb) has presented to parliament this session is put into force? I again ask the government to look into this matter very carefully, for I have no doubt whatever that if the present tariff proposals are carried out the result will be disastrous to the industry of the country.


Mr. FERNAND FAFARD (L'lslet) (Translation) :: I must admit, Mr. Speaker, that I found it difficult to follow the hon. member for Hamilton (Mr. Stewart) in the sonorous speech which he addressed to himself! However, as a good Liberal, I wish to congratulate him on the worthy effort he made in trying to criticize the present administration. Moreover, in keeping with custom, the inadequacy of the arguments of the opposition members shows the weakness of their cause. Although it is part of the duty of the opposition to criticize the government, I think,
if these gentlemen in the minority do not share our views as regards the lowering of duty on instruments of production, they might have shown proof of far more sincerity by congratulating us for having decreased the national debt by $30,000,000 and reduced the taxes which burdened the people, by $24,000,-
000.	On the contrary,'they reproach us with having been false to our pledges of last year, because we did not lower the duty on farm implements, and this year we are taunted for not having lived up to our pledges, because we have lowered them.
These gentlemen preach economy; we are always glad to receive advice on economy, because it is a- virtue which we practise; however, it does not become the Conservatives, who caused the country to run into debt for hundreds of millions, to lecture us, especially when we are aware that even after the war, in 1919, they showed a deficit of $382,000,000, in other words, that the increase of the public debt in that year was greater by $50,000,000 than the *whole debt of Canada previous to the war. This, however, is not to be compared with 1920 when the deficit rose to $674,000,000; these gentlemen who are not satisfied with a decrease of $30,000,000 on the public debt, had run the country into debt for more than a billion dollars during the last two years of their administration. In my opinion, Sir, a budget which shows a reduction in the national debt and decreases the taxes certainly deserves our approval. This budget equally protects the basic industries which help the development of our national resources, such as agriculture, lumbering, mining and our fisheries, and it will benefit our farmers, labouring classes and manufacturers.
There is no denying it, the farming class has passed through hard times during the last three years. Not only have the crops been poor, but, moreover, the prices of farm products fell to previous war levels, while the farmers are forced to pay for what they need, the same prices as during the war, Further, the farmers sell their products on every market, thus competing against the farmers of the whole world, even on their own markets. In no way do they benefit from protection, for when they purchase what is needed for their farms and themselves they must buy on a protected market and pay exorbitant prices. The farmer is tired of this state of things and his position has become intolerable. This is why many have been obliged to leave their farms, and others are on the brink of bankruptcy. I congratulate the government for having taken an interest in their fate.
The present budget will be a great help to the labourer, and I am sorry to see the old
The Budget-Mr. Fajard

Tory tactics crop up again which, consists in sowing division and prejudicing the classes against one another.
The farmer 'is the friend of the labourer -whom he needs-as the labourer is the friend of the farmer, who feeds him. The latter is one of those who desires most the success of the farming class, since it is upon this class that hinges the success of the industry of which the labourer is in need.
You try to prejudice the people by telling them that the East is sacrificed to the West. The latter has received no special favour; the duties on instruments of production have not only been lowered for the West, but they have been lowered from the Atlantic to the Pacific. The people who are the most protected by the present budget are the industrial classes.
When an architect replaces another to supervise the erection of an important building, which will serve as a monument to future generations, he must first ascertain the strength of its foundations, and, if he thinks that his predecessor has made errors, it is his duty to discontinue the work and take the necessary time to repair what might-become disastrous to the whole building.
The Liberal party's architect, the Right Hon. W. L. Mackenzie King, before proceeding to carry out in this country the policy of Laurier, observed that, since 1911, numerous rents had appeared in- our economic system, rents due to the war and far more to the bad administration of our predecessors.
Mr. d'ANJOU: Hear, hear!


Joseph-Fernand Fafard: The economic structure was threatened at its foundation and we would certainly have had to deplore an economic disaster if our leader had not protected the very basis of industry, which is farming.


Mr. McMASTER:: Hear, hear!


Joseph-Fernand Fafard: From times remote, all classes of society have acknowledged that agriculture bears the same relation to industry as foundations bear to a building. The industry in question is that of farm implements and it is very little affected, for, what has been taken away with one hand has been returned with the other. The only loser is the Department of Customs and Excise. This industry of farm implements is one which cannot exist without farming, on which it is entirely dependent. It has had time to establish itself on solid bases, under -the shield of protection, and it is certainly in a position to compete with the United States in our country, since it is * 
able to compete with the Americans in foreign lands.


Andrew Ross McMaster: Hear, hear.


Joseph-Fernand Fafard: 'Moreover, I recall the remarks which the hon. member for Brome (Mr. McMaster) made, a few days ago, in this House, when he quoted the words of the president of the largest company manufacturing farm implements-The Massey-Harris Company-who stated that he was able to carry on without protection.
The boot and shoe industry is somewhat affected by the British preference; on the other hand, how can the manufacturers complain, when the United States market which is unlimited is open to them wuthout any protection whatever? The working classes are not blind, Sir, and when they see manufacturers paying two dollars for a raw hide, they cannot help noticing that boots at $7 and $8. a pair represent a profit which they in no way benefit by. We, who hail from the country, all wish to see the welfare of the workman and manufacturer, as we wish for the success of the farmer. The rural districts are directly interested in industries, for it is with our small savings which automatically find their way towards the industrial centres, by means of the banking system, that most of the industries are kept alive. I might even add that it is one of the causes of the straitened circumstances of the farming, class. Formerly, it was an easy matter for farmers to borrow in their own parishes; but, for several years past, money is loaned on municipal and school debentures, yes, even, on industrial debentures, which are sometimes more or less doubtful. investments. This state of affairs is one more reason to state that farming is the true foundation of industry and that it was urgent to help it through the difficult crisis which it is experiencing. I, therefore, think that the banks could be more generous when it is a case of helping the farmer, and more careful than they are in their dealings with the speculator.


Some hon. MEMBERS:: Hear, hear.


Joseph-Fernand Fafard: If an inventory was taken of money lost by banks in our old province of Quebec, we could establish that 99 per cent of these losses arise from money loaned to speculators who do not have -or barely so-any other security to offer, than their cleverness in obtaining funds.
When the manufacturer bewails the fate of the poorly paid workman, to justify a request for higher protection, he lacks sincerity; for when certain companies were realizing, during the war, profits of 25, 50 and even

The Budget-Mr. Elliott (Dundas)
100 per cent, the manufacturers did not raise the salary of the workman, on the contrary they even increased their capital fourfold in "watered stock" so as not to show too large a dividend.
I am aware that a very high tariff may have for its effect the accumulating of colossal fortunes, but it is a policy which in no way helps the revenues of the country, on the contrary, it paralyses industry which needs to be stimulated through competition. I am aware that industries which are affected by the lowering of the tariff may experience a certain set back, but this will be more than compensated by the number of small industries which will spring up, built on sound foundations, not over capitalized, and which can more easily sustain the shock of industrial crises than Some of our large industries that owe their existence to the trust placed in them or even sometimes to the friendship of bank directors. It is not from want of protection that the country suffers-for it is under the protective system that our people emigrated to the United States-it is for want of population. After the war, the shell manufacturers organized so as to supply various products, consequently our manufacturers, as at present outfitted could supply a population of 25,000,000 inhabitants. This is one of the reasons which induces me to favour immigration providing it is the right kind. This policy is an excellent thing to help in decreasing out national debt, and, it will afford us the occasion of developing our natural resources, as intended by the government.
I am sorry, Sir, that I cannot agree with the statements made by the hon. Minister of the Interior (Mr. Stewart) regarding his policy fcr curtailing the geodetic and topographic surveys, and I trust he may somewhat alter his plans. Maps are absolutely necessary for the development of our forest and mining resources.


Andrew Ross McMaster: Three
cheers for the surveyors!
Mr. FAFARD (Translation) The hon. minister, himself, fully knows that if he wishes to draw foreign capital to Canada his first duty is to supply maps which may. induce foreigners to invest their money. A lumberman, whether he be Canadian or American would not take the slightest interest in the purchase of a limit, if he had no knowledge of. the rivers which cross it and which can be utilized for the driving of logs and the development of water powers, likewise mining prospectors do not venture far into the bush without a knowledge of the various canoe routes which they can follow, and maps to
enlighten them >as to the geological for->
mation; and such is the case with all other vast resources we possess, for instance the hydrographic information for the study of the water-powers. I think I have shown the necessity of these surveys which are essential to carry out the policy of development of our natural resources. I also regret to note that the eastern provinces are not given their share in the outlay of these public funds, which are expended in the West, not always on Crown lands but in a number of cases on private property. I ask the hon. minister to do us justice with reference to this matter.
I would also request more protection for our forests. The provincial government does its great share and has an excellent organization which deserves our encouragement.
I am convinced that the present budget, as brought down in the House, will benefit all classes of society, and the enthusiasm with which it was received in the business centres fills us with hope for a revival of activities in trade. The time has come to give the right aspect to our policy by establishing a tariff for revenue, so that the people, being unburdened, will love their native country.


Andrew Ross McMaster: Hear, hear!


Joseph-Fernand Fafard: I beg of our friends in the opposition to desist in their policy of hatred and disunion and to extend their help, so as to bring back to the country, the sunny days that we knew previous to 1911, when Sir Wilfrid Laurier was at the helm of affairs in Canada.


Mr. PRESTON ELLIOTT (Dundas):: Mr. Speaker, while I was sitting listening to the hon. . member for West Hamilton (Mr. Stewart), there was brought to my attention a question which was asked a very prominent witness before the Banking committee last year. The answer was " I do not know what you mean or what you are asking for, but I will say no, anyway." In connection with what the hon. gentleman has just said, I shall have to say no because I did not understand what he said.


An hon. MEMBER:: Why do you not say, yes'r


Preston Elliott: I may change
my mind afterwards when I know what he said.
Referring to the speech of the hon. member for West Hamilton we in this part of the House found it almost impossible to hear what he said, but I understand from some who did hear him that he was quoting letters of protest against a reduction in the tariff. I
1716	COMMONS
The Budget-Mr. Elliott (Dundas)
thought, if that were the case, hon. members in this comer of the chamber would require, perhaps, a week's time to read all the letters in favour of lowering, the tariff. If I heard some of the things correctly, I think the reduction in the number of employees in the different factories constitutes an admission that the time is ripe for a change in our present fiscal policy.
I should like to tender my congratulations to the Acting Minister of Finance (Mr. Robb) on the deliverance of his first budget, the manner of delivery and the substance. To many of us on this side, perhaps the outstanding * feature was the breyity of the speech, brevity for the reason that it did not go as far as we would wish it to go. We believe that the necessaries of life should also have been included in the cuts in the tariff, but we realize that as Rome was not built in a day, we cannot change our fiscal policy over night. If we can take the information given by the Minister of the Interior (Mr. Stewart) as the correct intimation to the manufacturers that this is the beginning of the end of protection, I think we in this part of the House will hope that that prophecy is only too true. Some of our friends to the right of us have been saying that this is no time for a tariff revision. I must take exception to that statement for this reason: We remember the year 1896, when the government which was returned to power was returned on the platform of "tariff revision downwards." The question was again fought in 1911 and again in 1921. The number of us who are sitting at this end of the chamber who were elected in 1921, werp elected, perhaps, to see that the tariff policy which was being advocated by those who are to your right, Mr. Speaker, would be carried out. We find, through the press and from many speakers to the right of us here, that we are being given credit for forcing this. I am not saying or claiming that we deserve the credit; but if this is the case, we feel that we have done one of the things that the people who sent us here asked us to do. We believe that in 1921 the question of tariff revision was prominently before the people. In that connection I remember in my riding a placard or poster which was posted in some of the halls. On this poster was this:
The Americans have passed the Fordney bill to shut out Canadian products.
The next line was:
If the Progressives are elected to power, they will so lower the tariff bars that we shall be flooded with cheap American goods.
Those two statements are not consistent and some of the arguments that were put forward 
last night from that corner of the House are as inconsistent as that.
I want to touch on a few different points. I represent a constituency, in which, possibly 95 per cent of the people are engaged in dairying. The people in that constituency have been blessed with a very fertile so?/. The farmers there have had the advantage of a good education, and if I do say so. I believe they are a good average class of farmers with, perhaps, above the average quality of soil. Those farmers are today in a very depressed condition due to the market value of their products. Some hon. members claim that by this lowering of the tariff the manufacturers will go out of business. I think the hon. member for Dufferin (Mr. Woods) stated in this House a few days ago the amount of capital invested in manufacturing concerns and the amount of capital invested in agriculture, and he showed that the amount invested in agriculture was almosl double the amount invested in manufacturing concerns. While none of us wishes to see those manufacturing concerns go out of business, if they are up against it, I want to tell them that .there are farmers in Ontario who are up against it also. In the constituency from which I come we have the Finch dairy station, a station which was started by the government. I have the report for the year 1923 which shows that each farmer sending milk to the Finch dairy station-and the report takes an average of thirty farmers- produced that year 72,918 pounds of milk. At the present time cheese is selling on the market for 13^ cents per pound.


Andrew Ross McMaster: That will be the wholesale price.


Preston Elliott: 
Mr. BAXTER:: May I ask the hon. member a question? Is he quoting any statement of mine?


Preston Elliott: I just read a clipping that I took from the Ottawa Citizen.


John Babington Macaulay Baxter: May I inquire when I began to use' the Citizen as a medium for the expression of my ideas?


Preston Elliott: Great men always get reported in the press of this country. I do not say and did not infer that the hon. member for St. John and Albert made any particular statement. But I believe it to be true, and I do not think he will deny it, that he tried to impress and did impress the Progressives while they were on their trip to the Maritime provinces with the im-

The Budget-Mr. Elliott (Dundas)
portance of the great ports of Halifax and St. John. Is that true? Is there anything wrong with that?


John Babington Macaulay Baxter: The hon. member and his colleagues saw with their own eyes the ports of Halifax and St. John and were duly impressed with them. Good wine needed no bush from me.


Preston Elliott: I understand
that hon. gentlemen in that corner of the House have had a monopoly on prophecies during the past few weeks, but I venture to make this prediction, that the hon. member for St. John and Albert will vote against the present budget.


John Babington Macaulay Baxter: Hear, hear.


Preston Elliott: Then there is
no disputing it, in view of that "hear, hear." Now, when he votes against that budget he votes to tax goods which will come into his own port of St. John.


John Babington Macaulay Baxter: May I ask my hon.
friend another question? If my hon. friend votes for the budget will he not vote against the declarations of the Canadian Council of Agriculture which he came here pledged to support?


Preston Elliott: I will answer
that in this way: We were sent to this House to use our own good judgment. We stood uu a certain piatlorm and we are going to use our own methods of getting that platform put into effect.


John Babington Macaulay Baxter: You are going against it.


Preston Elliott: If the hon. member will wait a moment I will explain my position. We did not expect that the fiscal policy of this country would be changed in a minute. We, are willing to back up any government, and we would be only too pleased to back up our friends to the right if they proposed something along the line of our own platform. Unfortunately, however, they have got so far into the rut that I am afraid they will never do it.
What I have predicted about the vote of the hon. member for St. John and Albert will, I believe, be fulfilled and I maintain that that vote goes to tax goods that will come into his port. So far as we in this comer of the House are concerned we do not look upon this budget as a finality. We believe that the government in going as far as they did this year should be encouraged, but we want to make it very plain that we do not believe that this is the end, and we do not want it
to be the end. When the hon. Minister of the Interior (Mr. Stewart) said that this was the death-knell of protection he voiced the sentiment of hon. members in this corner of the House. In their speeches last week the whole tenor of the remarks of some hon. members was that they were afraid that this was the beginning of the end of protection, and I hope they were prophets also. It is not so much what this budget is doing as what budgets which follow will do, and the present government will be well advised to do what the majority of the people of this country are expecting them to do, namely, make a great deal more reduction in the tariff another year.
We in this corner of the House have been .taunted with having been bought and sold, with being the overflow of the Liberal party, and so on, I may say to my hon. friends that we do not believe the people put them in here as our official guardians. We will do what we think is right and the people will hold us responsible; we will go back and face our constituents and accept the responsibility.
I see that the hour for adjournment is approaching, and I shall not take up very much more of the time of the House except to pay this: The people who are defending the manufacturers to-day have, of course, a perfect right to do so, but I believe that we also have a right to defend the people who sent us here. Now as far as agriculture m this country is concerned we are in this condition; unless we get relief and can find better markets for ,our produce the exodus from the farms of this country is going to increase instead of decrease. I am going to go a little bit further, and say that I do not believe that all the ills of the farmer are going to be cured by legislation. I believe that this lowering of the tariff is going to help us, but I believe that ,we must also help ourselves in the marketing of our goods. For centuries the people of this country have been learning how to produce, and for perhaps the last ten or fifteen or twenty years we have been told how to produce by people who knew no more about it perhaps than the man in the moon. We have to-day a great expense on our experimental farms along the line of greater production and my advice to the present Minister of Agriculture (Mr. Motherwell) would be to cut out a great deal of this expenditure and spend more on the development of our markets.
The hon. member for Parkdale (Mr. Spence) last night told us that he would have no truck or trade with the Yankees unless there was some money in it. I do not think it makes any difference to the people of this
1720	COMMONS
The Budget-Mr. Elliott (Dundas)
country, when they want to buy goods, who makes them so long as they can get them at a satisfactory price and the goods suit them. There is no reason why the people of this country should spend one dollar in the United States unless they believe they are getting value for their money. There is a market which the people of this country in 1911 turned down, due to a campaign not appealing to the people's common sense at all, but to their passions and sentiments. That market was turned down, and the statement has been made in this House that it is now closed to us. Now I am going to give you an example of how a factory in our own district is doing business in the United States to-day in spite of the high protection they have on dairy products entering that country, and making more money for the producer than we can get in our home market. A skimming plant was started in our town, and the cream is being shipped into the city of New York. This cream has to pay a tariff rate of 20 cents a gallon. That will net the farmers in that district to-day about thirty cents a hundred more than the milk producers are getting from the local cheese factories. There is an example of how even with this high rate of duty we can make more money dealing with the United States than we can in this much lauded home market of ours.
In conclusion, I am going to say this: According to the speeches that have been made by our Conservative friends, we are being given credit for the concessions made in this budget. We are not egotistical enough to think that we have pulled them over at all, but if such is the case, we can feel satisfied that we have done something for the betterment of Canadians generally.
On motion of Mr. Hudson, the debate was adjourned .
On motion of Mr. Graham the House adjourned at 9.55 p.m.
Monday, May 5, 1924