1928-03-05

PRIVATE BILLS


[Stage Direction]
Bill No. 56, An Act respecting the Sun Life Assurance Company of Canada-Sir Eugene Fiset.
Bill No. 57, An Act respecting The Edmonton, Dunvegan and British Columbia Railway Company.-Mr. Kennedy.

Hon. ERNEST LAPOINTE (Minister of Justice) moved:: That the name of Mr. Chevrier be substituted for that of Mr. Laflamme on the committee on industrial and international relations.


[Stage Direction]
Motion agreed to.
[Stage Direction]
Memorandum prepared by Monsieur P. De Vuyst, director-general of the Department of Agriculture in Belgium, for the Belgium committee of propaganda in favour of the International Agriculture Institute of Rome, Italy. -Mr. Speaker.

[Stage Direction]
auditor's report on reorganization
Hon. R. B. BENNETT (Leader of the Opposition) :: Might I inquire if the government will be good enough to have printed the report of the auditors, Messrs. Clarkson, Gordon and Dilworth, with respect to the customs inquiry?
Privilege-Mr. Pouliot

It is rather an important document, its preparation involved an expenditure of some $50,000 or more, and hon. members find it difficult to comprehend it without having copies before them. In the light of the legislation about to be introduced and the estimates, we should like to have copies of the report available, and I trust the government will make the necessary arrangements to have it printed at an early date.


Hon. W. D. EULER (Minister of National Revenue):: The report is voluminous, but
there is no objection whatever to printing it.



PRIVILEGE-MR. POULIOT

Mr. JEAN FRANCOIS POULIOT:: Mr. Speaker, I rise to a question of privilege. Last night I listened with great interest to the speech of my hon. friend from North Huron (Mr. Spotton) in the course of which he said:
My hon. friend from Temiscouata said that while in his riding the people are equally as prosperous as hon. members opposite would have us believe is the case in the country generally the boys in his riding went to the United States to make money so that they could come back and pay off the mortgage on the old man's house.
One might conclude that what the hon. member refers to happened last week. Well, I may be allowed to inform the house that those boys went to the States while the Tories were in power, and they came back under the present regime.



HUDSON STRAITS AERIAL SURVEY


Mr. A. F. TOTZKE (Humboldt):: Mr. Speaker, in the absence of the hon. Minister of Marine and' Fisheries (Mr. Cardin) may I ask the hon. Minister of Railways (Mr. Dunning) if word has been received of the missing aviators who have been engaged in an aerial survey of ice conditions in the Hudson straits?
Hon. CHARLES A. DUNNING (Minister of Railways and, Canals): The Minister of Marine 'and Fisheries advised1 me this mom-ing that the missing aviators had been found and are now safely back at their base ait Port Burwell.



THE BUDGET


[Stage Direction]
The house resumed from Thursday, March 1, consideration of the motion of Hon. J. A. Robb (Minister of Finance), that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, the pro-

posed amendment thereto of Mr. Cahan and the amendment to the amendment of Mr. Fansher (East Lambton).
Mr. D. M. KENNEDY (Peace River):: Mr. Speaker, the budget proposals of the Minister of Finance (Mr. Robb) relatng to taxation have not so far met with a great deal of favour from any quarter of this house. The Minister of Trade and Commerce (Mr. Malcolm) stated last Tuesday that he was glad to be able to congratulate his colleague on the statement of Canada's business which he had presented for the past year. But apart from such general remarks, there has not been very much favourable comment from either side of the house, especially from hon. members to your right, sir, with regard to the taxation proposals of the budget. In his reference to his colleague's statement of Canada's business, the hon. Minister of Trade and Commerce (Mr. Malcolm) asked:
What percentage of this credit is due to the self-reliance and industry of our people, what percentage to the acts of a benign Providence, and what to the actions of the government seems, however, to be a matter for debate.
Without seeking to fix the percentage of credit, Mr. Speaker, I would say that Providence has been generous to us during the last three years; our people have been very industrious; and I think we will have to admit that the Minister of Finance is a careful administrator.	_	_
Now, as far as my time will allow, I wish to deal with the taxation proposals contained in the budget. We have four main sources of taxation revenue:	Customs, excise, sales
tax and income tax, and it is as the budget proposals affect the taxation levied that I am particularly interested. I have not heard much comment so far in this debate, especially from the government side, on these taxation proposals. We have discussed many things which in my judgment are not directly related to the budget or connected with budgeting, but there seems to be a tendency to avoid any reference to the actual changes in taxation as proposed. As one of the members of this group I have been very much interested in some of the kindly criticism that has been levelled against us in this corner and against our amendment. I was very much interested in the speech made by the hon. member for South Huron (Mr. McMillan). He stated that he had a hard job to understand just why we were sitting on this side of the house, and he came to the conclusion, after reading our amendment, that there was no reason at all why we should sit on this side and that even he himself

The Budget-Mr. Kennedy
had stronger reasons for differing with the government than those set forth in our amendment.
The hon. member for Provencher (Mr. Beaubien) delivered a remarkable speech. He said in his closing words:
I intend to vote for honest and practical legislation-for the budget.
But what was his analysis of that budget which led him to that sublime conclusion? First:
The tariff resolutions which the Minister of Finance has presented to the house are confusing. I do not believe that all the lawyers in Philadelphia could understand them, and I am not going to discuss them because they are too confusing. I would point out, however, that there seems to be a joker in the proposals submitted by the Minister of Finance, and that joker is in the changing of the numbers of the schedule. Let me cite just one example in order to make my point clear.
Then he cites items 526 and 575. He goes on:
In the new schedules which the minister has brought down that is changed to item No. 545, and in changing the item they have inserted the words, ' for use exclusively in the manufacture of",-
He asks that the words: "For use exclusively in the manufacture of," be struck out.
So that the general public of Canada will get the same advantages as the manufacturers when it comes to importing material. He objects to the reduction in the income tax:
The reduction in the income tax, I am frank to say, does not please me.
These are his references to the direct proposals of the budget. Then he goes on to discuss the amendments. He says that some of us over here are anxious to rock the boat as it is safe. I would remind him that some of us rocked the boat when it was not safe, and if the matter is urgent enough and important enough we are prepared to do it again. The only reference which the hon. member for Provencher makes to the proposals of the budget he makes in condemnation of or in opposition to them. But he sums up his remarks by stating that he is prepared to vote "for honest, practical legislation-for the budget." I would point out that the hon. gentleman is the only member of the group known as Liberal-Progressives in this house who has so far spoken on this budget. I should like to know whether we are to take his attitude on the budget as representing that of the Liberal-Progressives. I am interested in this because I have a great deal of respect for the Liberal-Progressives and I should be glad to hear more of them tell the house what they actually think of
these budget proposals before the division is called on the amendments and on the budget itself. We are not infallible. We have been criticizing the budget and we are anxious to hear from some of those gentlemen, who have very much the same point of view as ourselves with regard to matters of taxation, as to the ground on which they will justify voting for the budget and against our amendment.
We heard also from -the Minister of Railways (Mr. Dunning). That hon. gentleman in his speech on Wednesday did not come any nearer discussing the actual taxation proposals or the change in them than to refer to the income tax and to the increase in the British preference. On the latter point he had this to say:
As to the criticism which has been uttered with respect to the intimation by the Minister of Finance that in future it was proposed to ask that all goods coming in, taking advantage of the British preference, should have a 50 per cent British or empire content, I desire to say just this: the Minister of Finance gave that intimation in no sense intending thereby to limit the British preference in the slightest degree.
Whatever the Minister of Finance's intention may have been, the change is bound to limit the goods that will come in, when we increase the rate from 25 to 50 per cent. It is just as sure as if you raised the standard of wheat. You will have less of that grade than if the standard were lower. I cannot understand why the Minister of Railways should have pursued that line of reasoning. Of course he took .a slap at the group system. This has nothing at all to do with the budget as a matter of fact, but as regards the statement made by the Minister of Railways on the floor of this house and in some parts of the country as well, if we are to believe the newspaper reports, that we in this comer of the house wanted and did attempt to bludgeon the government, I have this to say: If our efforts can be properly described as bludgeoning-I do not think they can be, but if so-then I declare, and I invite anyone to challenge the assertion, that the only attempt we have made in this house in that direction have been attempts to keep the Liberal (party true to the pledges which they made to the people of this Dominion. If bludgeoning is justified at all it is justified in a case of that kind. The minister said the other night that the hon. member for Southeast Grey had called that method democracy. Well, a betrayal of promises such as we have witnessed for a number of years in this country by the Liberal party is certainly something that is not in the best in-
The Budget-Mr. Kennedy

terests of democracy; and if we who have claimed to believe in the same principles that have been thus repudiated did not take every opportunity to keep the Liberal party true to its promises, we should also be untrue to democracy and to the people who sent us here.
I am not going to quote this time the Liberal or the Progressive platforms. When I was a youth I was once taken out to some evangelistic meetings in the north of Scotland and I remember an old evangelist stating there were some parts of Scotland he did not like to visit because the people were gospel-hardened. I wondered whether it is worth while quoting these, platforms any more. Are the people across the floor gospel-hardened so far as these promises are concerned? I hope that is not so.


Mr. COOTE:: I am afraid it is.


Donald MacBeth Kennedy: The Minister of Railways said something about cooperation. I remember reading in the press after the last election that there had been a meeting of the Liberal-Progressive group in the west. They reported that they were willing that the Minister of Immigration (Mr. Forke) should enter the cabinet because the policies of the two groups, Liberals and Liberal-Progressives, were similar. The Minister of Railways stated the other night that we had co-operation in this house between the two groups. After all, he is in power because of that system; he is in power as a result of co-operation between the two groups. I was glad to hear the minister say he was pleased with the co-operation which has been received from that group, but I wish some of the members of that group would tell us whether they are also pleased with .the .cooperation they have received from the treasury benches in carrying out legislation based on the policies on which they were both elected. I believe they owe that to their constituents, to this house and to the country, because I do not think they are fair to themselves if they vote without giving some explanation. As I understand the ward " cooperate " it means to work together for a common object. What is the common object? Is it this budget, the budget of last year or both together? The views of the three prairie provinces on fiscal matters are well known; the farmers represent a large proportion of the population of those provinces, and if you find a group of farmers expressing themselves with regard to the income tax and the tariff you can be pretty sure of their sentiments.
I do not want to take time to quote resolutions from the Canadian Council of Agricul-
ture and other farm bodies, but I believe the people who sent their representatives here from the three prairie provinces hold the same opinions with regard to taxation and budgeting in this Dominion. They are opposed to the indirect system of tariff taxation as they are opposed to decreases in the income tax.
Some of the newspapers of Canada have stated that the farmers are opposed to any reduction in the income tax because they do not pay that tax. Well, Mr. Speaker, possibly some of us would have come under the income tax had it not been for the exemption we were allowed, but notwithstanding that exemption I want to say that most of us are very anxious to-day to reach the point where we will have to pay income tax. If the farmers have not been paying income tax it is because they do not receive the incomes in spite of their long hours of work, the hardships which they endure and the practical conscription of the labour of both their wives and families.
The Minister of Railways referred to the sales tax and said that on this point the Conservatives and ourselves agreed. That is not so, and I am surprised that the minister did not read the amendment more carefully. I am strongly opposed to wiping out entirely the sales tax, not because I believe it is a good tax but because I believe it is better than the tariff. Under the sales tax we have pyramiding; not all the revenue collected goes into the treasury, but the tariff also pyramids and in addition possibly two or three dollars go into the pockets of private individuals for every dollar which is received by the federal treasury. The sales tax, on the other hand, does not lend itself to that, evil.
The hon. member for Provencher (Mr. Beaubien), asked the Minister of Finance, because he was a kindly gentleman, to strike out of the proposed tariff schedule the words " for use exclusively for the manufacture of ". I want to say to the hon. member for Provencher and to other members of this house who have beeh studying .the tariff ithiat we have not been tied down to a policy of protection in this country at all. No, indeed; we have had an arrangement of protection and free trade whereby the manufacturers get protection on their finished products and a low tariff or no tariff at all on the raw material they need to buy. They secure the benefits of both policies while we, on the other hand, suffer the disadvantages of both, and that is why we intend to fight until we get at least a more equitable arrangement. If the Minister of Finance in-

The Budget-Mr. Kennedy
tends to strike out those words in these proposals he will need something more than a kindly heart to carry him through. The tariff schedules as proposed by the minister are planned in my judgment to help a few large manufacturers at the expense of the general public and the smaller manufacturers, especially those manufacturing hats and caps.
In the first place we have a reclassification; under the old items a certain rate of duty was provided on a certain line of goods, such as clothing or blankets. The old item would apply to cotton and woollen blankets, or to cotton handkerchiefs, linen handkerchiefs and silk handkerchiefs as the case might be. Now an attempt is made to divide those items as between cotton, flax, hemp and jute, wool, silk, and art silk. At the beginning of this schedule the tariff is changed on some articles of a general character to suit certain industries, and while some of these changes are not extensive others are very important. In the time at my disposal it would be impossible for me to go through all these items, but I intend to examine some of these proposals in some detail to show where the advantage lies. It may be dry work, but I believe it worth while to do at least enough of it to show the general way in which the tariff has been revised.
We have two concessions to the fruit and vegetable growers in the proposed budget changes. The first is in item 87b:
Small onion plants, grown from seeds and imported for bona fide transplanting or propagation purposes only.
The other concession is under item 219a:
Non-alcoholic preparations or chemicals for disinfecting, dipping or spraying.
Last night I was rather interested in the remarks of the hon. member for Yale (Mr. Stirling). He started out by approving of this reduction in connection with onion plants, but then he advocated protection when it came to the sale of the onions. That is another illustration of the desire to profit by both policies, and it shows that human nature is pretty much the same on both sides of the house. The onion growers last year were referred to by the Minister of Railways in a rather scornful fashion; I remember he said they wanted protection, and that there were only three hundred onion growers in the Dominion of Canada. However, I congratulate the Minister of Finance on taking this method of helping them instead of increasing the protection already afforded.
Item 192a is a concession to the paper mills, and here is a case where these mills are given tariff reductions in order to assist
them. We have made considerable sacrifices in this Dominion to help the paper industry, but these manufacturers are now anxious to benefit by a lower tariff or a lack of tariff when they want to buy anything which enters into the manufacture of their finished product. As the trade returns are made up it is impossible to find out just what the importation of these articles amounted to for the year 1926, the last year for which we have returns.
Now I come to item 267b which is a very important one. The old item 267a read as follows:
Crude petroleum in its natural state, .7900 specific gravity or heavier at 60 degrees temperature, when imported by oil refiners to be refined in their own factories:	British
preferential tariff, free; intermediate tariff, free; general tariff, free.
The new item in the tariff reads as follows:
267b: Crude petroleum not in its natural state .725 specific gravity or heavier at 60 degrees temperature, when imported by oil refineries to be refined in their own factories: British preferential tariff, free; intermediate tariff, free; general tariff, free.
On and after July 1, 1931, those rates will be per gallon: British preferential tariff A cent, intermediate tariff A cent, general tariff i cent. Of crude petroleum, gas oils other than naptha, benzine and gasoline lighter than .8235 but not less than .775 specific gravity at 60 degrees temperature, the imports for the year ending March 31, 1926 were 1,884,348 gallons, valued at 8118,181 on which a duty of $28,265.23 was collected under the general tariff. In the case of crude petroleum in its natural state, .7900 specific gravity or heavier at 60 degrees temperature, when imported by oil refiners to be refined in their own factories, the imports amounted to 470,574,100 gallons, valued at $25,672,481.
The budget proposals will now allow (to come in free until July 1, 1931, crude petroleum not in its natural state, .725 specific gravity or heavier at 60 degrees temperature, when imported by oil refiners, to be refined in their own factories. This will allow partial refinement of crude petroleum in the United States, Peru, or Mexico, countries from which it has been imported, and the importation to Canada without duty until July 1, 1931. This is a concession to oil companies without any reduction in ithe duty in the finished products. It is the first intimation I have had that the oil companies were in distress. It appears that we are going to allow them to refine not
1,884,000	gallons of oil, but 470,000,000, and to bring that amount of oil in annually without paying duty up to July 1, 1931. The protection on most of the finished products of
The Budget-Mr. Kennedy


Mr. SPEAKER:: The hon. gentleman's
time is up.


Hon. S. F. TOLMIE (Victoria, B.C.):: Mr. Speaker, I have listened with a good deal of interest to what has been said in the
The Budget-Mr. Tolmie

course of this debate, and it is rather difficult at this late stage to present to the house any thoughts that have not already been dealt with to some extent. Before proceeding with my remarks on the budget, let me say that my attention has been drawn to some observations made by the hon. member for East Essex (Mr. Odette) last evening when he stated:
Last but not least the Canadian Steel Corporation, the Canadian branch of the United States Steel Corporation, have started the production of steel in two large factories in Ojibway.
An hon. member wired to the Canadian Steel Corporation as follows asking for confirmation :
Has Canadian Steel Corporation started the production of steel at Ojibway?
Eccles J. Gott.
The reply from the Canadian Steel Corporation reads:
Message received. No.
I have been listening to remarks from different comers of the house and I think I have at least solved one thing and that is that, when a man either comes into this country from the outside or graduates from college or school in Canada and is ambitious, energetic, thrifty, capable and accumulates a little money round about him at, say the age of fifty years, he is promptly classed as a capitalist to be fired at by tax collectors and certain groups of men who perhaps have not been quite so successful and who have not gathered this world's goods about them. Listening the other day to the hon. member for Rosetown (Mr. Evans), when he drew that very blue picture of the farmers in Saskatchewan who he claimed had been "shot at" for a long time by the manufacturers and the capitalists, I could not help thinking of a number of these farmers who have appeared on the Pacific coast, having made enough money from their farms in Saskatchewan to retire for life and come out on the Pacific coast and enjoy themselves, spending their time fishing when the fish are willing, playing golf and generally having a good time. These men are welcomed by us in Victoria and along the Pacific coast. We are very glad indeed to see them, and we would like to have more of them. Glancing across the house, too, I notice that the representatives from Saskatchewan are a very prosperous looking lot of men and capable of holding up their end in this house, and I come to the conclusion that after all these people at the coast that I refer to and these gentlemen across the floor must be just a few who have got away from the manufac-
turer and the capitalist. I have heard the hon. member for Rosetown speaking along these lines on several occasions, and I have been living in hopes that some day I would have the pleasure of seeing him out on one of our golf courses, rigged up in plus fours and all the usual paraphernalia, chasing the elusive pill over the course and inhaling the ozone of the Pacific coast. After he had enjoyed himself out there for a week or two and mixed with these retired capitalists, farmers and manufacturers, I am sure he would think that they are not such a bad lot after all. We need all these classes in Canada. We need the farmer, and he should have all the advantages that we can give him. We need the manufacturer, and we also need the capitalist very badly indeed, and we want him to expend his capital within the confines of this country, and in British Columbia particularly, if we can induce him to come out there.
I was sorry to notice in some of the newspapers, after some remarks made in this house, an effort to give the impression that the Conservative party was opposed to the Canadian National Railways. This is absurd on the face of it, because the Canadian National Railways were brought into being by the action of the Conservative party, and this party has supported them through thick and thini until now the Canadian National is one of the most important organizations in the country. It has a great deal to do with the development of this country, just as has the Canadian Pacific, and in British Columbia we appreciate what they are doing there. They have a very fine lot of men in charge of the Canadian National railways-and they have improved their service very greatly as regards the handling of both freight and passengers. They can rest assured that the Conservative party will stand strongly behind them and see that they get fair play under all conditions.
The other day, listening to the Minister of Trade and Commerce (Mr. Malcolm) stressing the fact that there was seasonal unemployment in Canada, I could not help wondering just how he ever expected to have anything else under the Liberal policy. Why, in the matter of the attempt to have our northern dairymen produce butter on one cent protection as compared with a country where spring conditions exist, let me say that no less than 103,000 cows were shipped out of Ontario in 1927. Now to take care of that number of cows, at least 5,000 men would be employed. Where did they go when those cows left this country? Either they went to the cities and joined the unemployed, or

The Budget-Mr. Tolmie
probably they went to the United States. While the minister stressed the fact that this unemployment was seasonal, he offered no remedies whatever. I want to say that British Columbia is very much interested in this question, for the reason that thousands of harvesters are shipped out to the prairies from the east during the harvest season, and a great many of these men drift across the mountains and to the Pacific coast, seriously interfering with the labour men who are there. The labour men on the Pacific coast are men who in many cases have their own homes and have to pay taxes, and yet they have to meet with this unfair competition. Those Who are unemployed and are needing support of some kind during the winter months have to be carried by our province, and by the municipalities and the cities. The minister in his remarks clearly indicated that thi3 was a Dominion-wide problem. The Conservatives, Mr. Speaker, have a lurking idea that if they could get into power and introduce their policy of running Canada for the benefit of Canadians, this situation would be alleviated to a very great extent. But if the Liberals are going to remain in power they should devise ways and means of taking care of those who are bound to be unemployed as a result of the Liberal policy.
The Home Bank legislation is another matter to which I would like to refer briefly in passing. The house will remember that this bank failed some time ago, and that certain sums were voted by this house for the purpose of relieving a certain number of the depositors to the extent of some 35 per cent of their loss. The bill passed this house but was thrown out by the Senate, and later an amended bill was put through, and the result has been that- the funds voted at that time have not proved sufficient for the purpose, that while some early applicants have received their 35 per cent, others have received much less, and some none at all, although they are just as deserving as those who have been paid. It is estimated that a further $450,000 will be necessary to carry out the intention of parliament in the act which was passed in 1925, and I would call the attention of the government to the necessity of taking action along this line at this present session if possible, in order to carry out the intention of parliament and act in good faith with these people.
While the government has been emphasizing the necessity of extended markets and the establishment of embassies in different parts of the world-certainly the extension of our markets is quite O.K.. and I endorse it to the fullest extent-still I feel that we are not
making the best use of the opportunities offered to us in Canada. I feel that we should make a very thorough survey of our opportunities for development in industry and also in agriculture, that we should carefully examine the list of imports coming in from the United) States and select those articles which we can produce here at a profit, and then concentrate on their .production with a view to keeping that money at home for the use of our Canadian people and alleviating the seasonal unemployment that was referred to by the Minister of Trade and Commerce.
There is another matter in connection with the development of our industries in Canada which is very important indeed. In a country like this, with a sparse population and long hauls, the freight bills which it is necessary to pay for the handling of these products is a very important factor indeed, and the nearer to the point of production we can get our goods consumed, the more there will be for the producer. We recognize that the farmer today is facing many disadvantages to which he was not subjected some years ago. He is facing greater costs, because labour has been sensible enough to form unions for its own protection, and it has raised the standards of living in this country, which is very much to be approved. By organizing in this way they have been able to provide themselves with comfortable homes which they were not able to possess some years ago. But all this has added to the cost of living for the farmer and the cost of carrying on his work. In addition, the farmer has experienced some increase in farm wages, but on the other hand he is in some cases receiving greater prices for his products. The buying power of the man who is working for wages has increased, and he is now paying bigger prices for the products he requires than he did before. The farmer, too, might help himself in this regard and vastly improve his condition. In the first place, the average dairy cow in Canada yields 150 pounds of butter fat per year. We have many cows that are producing very much more than that. The milk product alone of our average cow would be less than 3,000 pounds, while we have other cows that have produced over 30,000 pounds, showing the difference between the very good and the very bad. In addition to that, we find that thousands of our cattle in very thin condition are rushed to market in the various centres where stockyards are located, such as Calgary, Vancouver, Edmonton, Winnipeg, Toronto, Montreal, with the result that they lose a great deal through lack of weight, and fetch poor prices. The farmer by improving these conditions can place himself in a much more favourable posi-
9S8
The Budget-Mr. Tolmie

tion. Of the average animals for beef that go through our inspection abattoirs, let me say that only ten per cent are good enough in quality to compete with the Argentine beef which is shipped to the London market, showing that we have yet to do a great deal in improving the quality of our product. The farmer might take a generous view of the situation and do this just as an act of mercy to the poor Canadian consumer.
We all recognize the fact that nothing is of more importance to Canada than to place agriculture on a good, sound, prosperous basis. To do that we must remove as far as possible the farmer's disabilities. The budget promises nothing in this direction. The Canadian farmer is faced by the competition of the farmer in the southern United States, Mexico and California, who ships his products much earlier in the season, and has the further advantage of cheap Mexican labour. Mexicans cross by the thousand every year to work in the vegetable and fruit growing districts of the southern states, so that the Canadian farmer has to face the competition of fruits and vegetables produced under peon labour conditions. Then again the man down there very often will have a few acres devoted' to a certain class of vegetables and sell the main portion of his crop to good advantage in his own market and rush the tail end of his crop to this country, to compete with the producer here who is just getting his first crop on the market. The same thing is true of fruit and eggs. We have prayed to the government for protection along these lines ever since the passing of the Fordney tariff, but without result. The very last failure on the part of this government to show its appreciation of agriculture and its importance to the country was to ask our farmers to produce butter with a protection of only one cent a pound, while butter is produced1 on the grass and brought up here at a season of the year when our winter production is at the highest peak of cost. Yet our farmers are asked to produce butter under those conditions with a protection of only one cent a pound, while their competitors in the United States receive twelve cents a pound protection for their goods.
One branch of our agriculture has been seriously neglected for many years. It is a very valuable branch of the industry and is essential to the development of this country.
I refer to the sheep industry. We know the value of sheep, the cleaning effect they have on the farm; for they consume weeds and everything good to eat in the form of green food. They are produced at a very low cost, and they save the farmer many a long trip 
to the country store for meat. Another point in their favour is that they yield two crops during the year-a crop of wool and a crop of lamb. Still another point in favour of the sheep .industry is that a farmer can go into it with very little outlay indeed. Sheep will do we'll in any part of Canada, for we are not affected 'by drought as they are iin Australia and some other countries. The achievements of our breeders at the various exhibitions are simply an index of what can be done here in raising sheep of the finest quality. We all know Colonel McEwen, of Ontario, who on several occasions has won the first prize at the Chicago International Exhibition for the best carload of lambs, produced in and shipped from Canada.
We have done very little in a real way to support the sheep industry, and the figures I am about to give the house will be very interesting in this connection. While we have given prizes at exhibitions to encourage our farmers to produce better sheep, while we have formed sheep clubs in various parts of the country, while we have distributed pure bred sires-and all this has had some effect, yet the general effect, taking the whole Dominion. into consideration, is seen in the fact that the development of the industry during the last fifty-six years is nothing to be proud of. For instance, our sheep population in 1871 was 3,155,509; in 1927 the estimated figure was only 3,262,706, indicating that there is something radically wrong with our sheep industry because we have had immense increases in our cattle, in our horses-so long as horses were in use-and in swine, poultry and so forth, but with regard to our sheep we are practically where we were fifty-seven years ago.
What is that something that is radically wrong? Apparently it is the fact that our wool has been unprotected for very many years-I think perhaps over the whole of this period. Let us compare this for a moment with conditions in the United States. They have had a tariff on wool since 1816, except for a short period during the war. They took off their tariff in 1913 because there was a great demand for wool probably anticipating what was going to happen, and by 1921 the United States was simply flooded with wool of all kinds. The tariff was put on again in 1921, running from 15 to 45 cents a pound. The sheep population of the United States now stands at 44,455,000, the increase being 6.5 per cent during last year, or nearly as much as the whole sheep population of Canada, while our sheep population is, as I have said, practically the same as it was

The Budget-Mr. Tolmie
fifty-seven years ago with free trade in wool prevailing here. That fact alone should occasion a good deal of thought.
Now, this country is capable of carrying more sheep than t'he United States. We have a vast grazing area, and we can build dp a huge industry just as soon as the government comes to the conclusion that it must run this country for the benefit of the people |who live here and pay the taxes. While we can grow sheep in any part of the Dominion, and grow them to perfection, I think we have in the province of British Columbia one of the greatest potential sheep areas on the continent of North America. I make this statement without fear ;of contradiction, for I have been connected with agriculture all my life and have travelled over the greater part of this continent. In 1871 statements were made by prominent easterners that the Canadian Pacific Railway would never get enough traffic to pay for the axle grease used in the operation of the road. We were also told that all the capital in the British Empire could not complete the road and operate it after it was built. At that time the country west of the Alberta boundary was described as a "sea of mountains." Well that sea of mountains has proven to be a tremendous asset. In the first place, we have there a crop which we can reap every year-scenery. We are selling it to the tourists of the world to the extent of millions of dollars a year. And there is one very important feature about this crop: all you have to do is to reap it; it was sown years and years ago. It is there and will remain a valuable asset just as long as any of us are interested. Then we have in those mountains vast mineral deposits, having sold only last year over seventy million dollars' worth of minerals in the province of British Columbia. In addition to that, we have in the valleys and foothills a potential sheep country second to none anywhere. We have there about 160,000,000 acres of range land, about 100,000,000 acres of timber range, and 60,000,000 of open range, all ideal for live stock conditions, and much of it excellent for the production of sheep. Sheep there can not only graze on the grass but they can also browse under conditions that they enjoy so much and under which they thrive very well.
Let us glance for a moment at the United States by way of comparison. Their new range is about exhausted; they have about reached their peak in the production of sheep at present cost, and any increase in their flocks now will have to be carried out largely on the farms and consequently at added cost of production. Their present ranges have
been over-stocked to a considerable extent. The four states lying just south of British Columbia-Montana, Idaho, Washington and Oregon-a little larger in area than the province of British Columbia, are using about 69.75 per cent of their available range, while British Columbia, with 160,000,000 acres, is to-day using only 6.25. Government experts in British Columbia advise us that we have sufficient arable land in the country to winter feed all the live stock that could be raised on that 160,000,000 acres. What is the value of the live stock at present using the British Columbia ranges? Only $12,000,000; and if all that range were put into use the potential value would be $240,000,000. The feeding season in British Columbia has no very serious difficulties. We feed from three to four months, depending upon conditions. I am speaking of range sheep. The period is three or four months, the longer period when there is a severe winter. It requires from two to three pounds of good hay per day to carry sheep over the winter, and not so much when the range is open in a mild winter. At the present time there are less than 100,000 sheep in British Columbia. One farmer with whom I was speaking a short time before I left told me that his lambs had averaged last fall, 80 pounds each. Some of the flocks on the range clip as high as 10 pounds of wool per ewe. One rancher sold his lamb crop for $30,000 last year, and these were produced on grass in the province which has been going to waste for hundreds of years. We have millions of acres of land available for production of sheep.
Predatory animals are not a serious menace. The usual method of coping with them out there is to trap them, poison them, or employ other destructive methods; the plan during the winter season is to trap over the range which will be used the following year. By so doing, many of the predatory animals are got rid of. We have good dog laws, and they are so arranged that they can immediately be put into effect upon a district being designated a sheep district. There is a splendid opportunity for the production of pure bred sheep in Canada and good prices are obtained for Canadian sheep. One of our Ontario breeders two years ago sold a single animal for $1,000. Our sheep are now known throughout the world. We have been shipping across the Pacific and to the United States and other places for many years.
As regards the production of fine wool, it has been said that Canadians are unable to produce wool of as fine a quality as that produced in Australia. This is perhaps true in regard to some specially fine merino grades,
The Budget-Mr. Tolmie

but I am sure that research and careful breeding and feeding would bring satisfactory results; and in a province like British Columbia, where we have a varied climate and varied soils and conditions, it would be quite possible by careful handling to produce wools of a fine quality. This presents an opportunity for our research bureau to carry out some investigation along these lines.
I ask you, Mr. Speaker, is it not good business to develop our opportunities at home- just such opportunities as I have been describing? I am quite convinced that with a well organized effort, and going after it persistently and carefully on a well laid plan, we could add greatly to our agricultural wealth in Canada through the development of the sheep industry. We should encourage the manufacture of wool in this country. After all, our first business in carrying on the government of Canada is to care for the wants of this country; let us put our own business on a good sound basis and1 we can go further afield later on.
Besides the fact that our wool growers face world-wide competition without any protection, the Minister of Finance (Mr. Robb), in the very budget we have under consideration at the moment, has removed all restrictions on rags, waste and trash of various kinds coming into Canada. It is bad enough to use our own rags 'and trash and waste of every description, having such material made into shoddy to compete with the local producer. But why should we accommodate ourselves to the rest of the world? What have we to do with their rags and tradh? It would be better for us to produce wool from live sheep and make clothing than to use rags and trash coming from other countries.
Taking the budget as a whole, I must say that the Minister of Finance has certainly been very generous with other parts of the world; he has been more generous with foreign countries than with Canada, instead of building up Canada first.


Mr. M. F. HEPBURN (West Elgin):: In his introductory remarks the hon. gentleman who has just taken his seat (Mr. Tolmie), referred to the statement made yesterday by the hon. member for East Essex (Mr. Odette), to the effect that the United States Steel Corporation had begun production in their steel plants at Ojibway. If the hon. member will look more closely he will see, further down the page, that the hon. member said:
In any event, they have announced that they are starting their plants in Ojibway and will manufacture steel in Canada. .	.	. The industries that I have enumerated are actually in operation or about to commence operation.

The hon. member for South Essex (Mr. Gott), stretched the point somewhat finely, but the fact remains that these two plants are being prepared for production and the company have announced that production will begin shortly.


Mr. GOTT:: The company says that there is no production; that is the wire.


Mitchell Frederick Hepburn: They are about to begin production.


Eccles James Gott: They say not.


Mitchell Frederick Hepburn: It is obvious that if they build a plant they intend to produce something. At any rate the point has been pretty finely drawn. Now, I have followed with considerable interest this debate so far as it has gone, and I cannot help feeling that a good deal of time is lost in these discussions which follow the budget speech and the speech from the throne. Probably it would be better if we were to follow the example set by Great Britain in this regard and shorten these debates to three or four days each, devoting more time to the discussion of the estimates and bills coming before the house. In these debates, however, we are able to hear discussed in this house the many diversified problems of the country and to elicit the views of various members representing constituencies throughout Canada. In the past week, I fear, the members of this house have been bending their energies more in the direction of delivering fine campaign speeches than of giving constructive suggestions to the government of the day. In referring to speeches given by members of the opposition, I desire to congratulate the hon. member for North Huron (Mr. Spotton), on his very able and fluent address delivered last night, and in passing I would also compliment my good friend the hon. member for South Essex (Mr. Gott), upon the efficient manner in which he read his speech to the house yesterday.
I feel that the bulk of the Conservative members have been very fair in their criticism and we have heard some very able and constructive addresses. Particularly would I refer to the two young members from the maritime provinces who sit across the floor, the hon. member for Inverness (Mr. Mac-dougall) and the hon. member for Queens-Lunenburg (Mr. Ernst); and coupled with their names I would mention that of my good friend the hon. member for Hants-Kings (Mr. Ilsley), who sits behind me, and whom I would congratulate. It reflects credit on the people of the maritimes that they should send such (men to parliament.

The Budget-Mr. Hepburn
Coming down to the four parties who sit in the southeast corner of the house, they consider themselves bound together by a common ideal and by an equal status, in no way subordinate one to the other. They are all obsessed with the one idea that they have no politics. Politics, Mr. Speaker, is defined as the science of government, and when they say they have no politics I have no quarrel with them. I do say, however, that we in this corner of the house have been subjected to severe arraignments, admonitions, charges of betrayal and insincerity, and if it were not for the fact that those charges go beyond this house I would consider it beneath my dignity to even reply. I feel, however, that if we allow them to go unanswered we will probably earn the contempt of hon. members opposite, and rightly so. On Tuesday last we were favoured with a very eloquent phillipic, if I may use the term, by the hon. member for Southeast Grey (Miss Macphail). Speeches by the hon. member are not uncommon in western Ontario and even in the west, because she has the habit of making periodic crusades over the country seeking whom she may devour and incidentally, and as a side line, making the world safe for democracy. I am sure that when her forty minute allowance expired she had few unuttered thoughts in her mind so far as the evils of the Liberal party were concerned and to those of us sitting on this side of the house who were the objects of her attack on that particular occasion I am sure that not even exceeding the old age pensions the forty minute rule appeared to be the most humanitarian legislation ever enforced in this house.


Mr. CHAPLIN:: That applies now, also.


Mitchell Frederick Hepburn: Take your medicine
In her ramifications the hon. member for Southeast Grey took the opportunity to criticize the educational system of this country, as she usually does when speaking. I quote her very words:
I should like to know why some fellow, with a fossilized brain sitting in some office in some government service, should direct the kind of education which the children of farmers are to have. . . .


Miss MACPHAIL:: I say it again.


Mitchell Frederick Hepburn: In the Parliamentary
Guide, which speaks of the great and the near-great in this house, I find that the hon. member has a school teacher's certificate, which no doubt qualifies her to make such observations with regard to those at the head of the educational system in our province. I would suggest to the hon. member for Fort Willian (Mr. Manion), by reason 56103-61
of the fact that he has found a way to get on the payroll of the Ontario government, that he see the Premier of Ontario, who is also the Minister of Education, and find out if a place cannot be made for the hon. member for Southeast Grey as Minister of Education for this province. I do not think she would have any scruples in having her indemnity supplemented by $7,500 per year; that is one of the ideals she has discarded since coming to this house, and she is now willing to take as much money as anyone else in the house.


Agnes Campbell Macphail: I feel that I am worth it now.


Mitchell Frederick Hepburn: Possibly; I am not disputing that. The hon. member has her own opinions on that point. I hope however, that she will not see fit to write such sentiments to the school children of the county of Grey, as she usually does. I recall that she gained a good deal of publicity some time ago by school circular letters, and I believe these sentiments would be dangerous doctrines to implant in the fertile minds of our school children. It would sow the seeds of disrespect for educational authority.
The hon. member advocates occupational group government. It is a peculiar thing that in the province of Ontario, which I believe is on a par with any other province in ability, integrity and good judgment, only one member advocates such form of government. It is an old, worn-out method, and I do not believe it is applicable to the conditions existing to-day. It is all very well to make an appeal to prejudice, but I say in all sincerity that if you cannot cooperate in a riding and send someone to represent all interests here our system is of no avail. How can you send a farmer to represent farmers and a doctor to represent the doctors and expect them to cooperate here? I believe cooperation Should begin right in the constituency. I do not believe for a moment that the views of the hon. member really reflect the sentiments of the people of the county of Grey.


Mr. IRVINE:: May I ask the hon. member a question?


Mitchell Frederick Hepburn: I am in an amiable mood; you may ask anything.


William Irvine: Would the hon. gentleman
explain how a western farmer, who is busy
every day, could cooperate with an eastern manufacturer in his constituency?


Mitchell Frederick Hepburn: I would ask my hon.
friend if he is a farmer?

The Budget-Mr. Hepburn


William Irvine: Yes, I am.


Mitchell Frederick Hepburn: That is all I want to
know; I will deal with your question later on.


William Irvine: Do not forget it.


Mitchell Frederick Hepburn: You may recall it to my attention if I forget. This idea of occupational group government is not understood by a hundred people in this country. If you selected a dozen people in the county of Grey and asked them what occupational group government meant, I doubt if one could tell you. From that fact my deduction is that the ideas of the hon. member are not endorsed by the people of Grey, and I believe her election can be attributed to the novelty of voting for the only lady member of this house. I believe I would be tempted to vote for her myself if I resided in her constituency.


Agnes Campbell Macphail: I am not so badly in need of votes.


Mitchell Frederick Hepburn: Unfortunately the hon.
member cannot help who votes for her. However, as I was saying I do not believe the hon. member represents the views of the riding, and I do not think she represents the sentiments of the women of Canada. In a speech the other day she said, "I hate housework, I abhor it."	That was not the
sentiment of the women who helped pioneer this country, and who deserve all the credit we can give them for the heritage we have received.


Eccles James Gott: Will the hon. member permit a question? He said the hon. member for South Essex had the audacity to read his speech, and I would ask the hon. member if he is not reading his own speech.


Mitchell Frederick Hepburn: No, I am simply referring to notes and I am quoting from a press report as well. The fact remains that they are still selling wedding rings, so I take it that the hon. member neither represents the sentiments of her riding nor the sentiments-of the women of this country.


Agnes Campbell Macphail: Must wedding rings
and housework necessarily mean the same thing?


Mitchell Frederick Hepburn: You do not know anything about it and it would take too long to explain. The hon. member went on to say:
I know so many men who in their own homes like to be little gods, dispensing justice and mercy.
I am sorry she has that biased opinion; I think perhaps she got it from her association

with the hon. members who sit around her, because that is exactly the attitude which they maintain in this house.


Mr. SPEAKMAN:: A Daniel come to
judgment 1


Mitchell Frederick Hepburn: I am glad you do not
like it. It is a relief to this country that those hon. members sitting opposite, having extreme views, are not in a position to put them into effect, because I think that would be a very expensive experiment for this country.


Agnes Campbell Macphail: Mr. Speaker, I believe the hon. member who is speaking should tell where he obtained the quotation which he last gave the house. He referred to a speech made by myself as though it had been made in this house.


Mitchell Frederick Hepburn: The speech to which I refer was delivered before the Lions club in Ottawa.


Agnes Campbell Macphail: I believe it was titled a humorous speech, if the hon. member would read it all.


Mitchell Frederick Hepburn: It was a speech, at all events. It is a good thing that in this country we have men of outstanding ability in the cabinet, men who have proved their ability in administrative work before entering the cabinet, and I think it is as vexing to the country as to the members on this side of the house to see hon. members opposite cloak themselves in that sanctimonious air, tilt their noses upward and point fingers of scorn in our direction. In particular the Progressive members on this side of the house have been censured, but I want to say that the Progressive members over here are cooperating with the government and are accepting the responsibility of government, and their efforts are bearing fruit. Hon. members opposite do not want the responsibility of government, if they will only be frank and tell us their real purpose in the house. The Minister of Railways described it exactly the other day, I believe, when he said hon. members opposite want the balance of power in this house to be able to bludgeon the government into submission. They do not want a democracy; they want an autocracy with themselves in the saddle, and that is their real purpose here. Those hon. members in question trade on prejudices, and sow the seed of disrespect for public men and public institutions. They must necessarily be fomenting some imaginary grievance constantly to justify their existence. I would refer here to the hon. member for Mackenzie (Mr. Campbell) who in this house

The Budget-Mr. Hepburn
on Monday charged this government with holding office by fraud and deception. I do not know how much the .hon. member knows about fraud himself, but I can vouch that that what he knew about deception cost him $1,500 in the civil courts last summer when twelve men on a jury refused to believe his word given under oath. In the session of 1926, his voice was raised in righteous indignation in protesting against the Moses Asiz case where a stay of prison, sentence was granted allowing a man to start a gaol sentence in the fall instead of in the spring.


Donald MacBeth Kennedy: Does the hon. member
approve of the Asiz case?


Mitchell Frederick Hepburn: I am merely pointing
out the inconsistency of hon. members opposite. I am glad it is having its effect. It is time that some action along this line was taken. Otherwise my hon. friends would go on and sin even more grievously. I am not familiar with the merits of the Asiz case, or the one I am about to cite, but at the time the hon. member for Mackenzie was censuring the government for its actions in this regard he too had successfully pleaded with the department for a stay of jail sentence for a bootlegger regularly convicted in his own riding. It was exactly a parallel case. Consistency is indeed a rare jewel with the hon. member. He practised for political effect the very thing Which he denounced.
I should like also to make a passing reference to the hon. member for Bow River (Mr. Garland). He has on various occasions severely criticized this government for its tardiness in bringing down low tariff legislation. He does not believe in special privileges. He is, I believe, a free trader. A few days ago he made a very eloquent plea in this house for the coal industry in his riding, which I am given to understand is owned largely by American capitalists who charge $5 per ton at the mines in Alberta while at the mines in the United States they only charge $2.25 per ton. May I read a few passages from the address of this ardent low tariff man who, I take it, shudders at the thought of any industry not standing on its own feet. My hon. friend said:
Before I go on with the details of the discussion on this particular point I would like, in passing, to remind the house that in the year 1926 alone Canada expended for foreign fuel and also for freight charges on that fuel to transport it to Canada about $114,000,000.


An hon. MEMBER:: What are you quoting from?


Mitchell Frederick Hepburn: From page 111 of Hansard, under date of February 2, last. The hon. member goes on to say:
56103-61J
The central provinces in 1926 paid out for household coal and freight thereon no less than $52,000,000.


William Irvine: Is the hon. gentleman in
order in quoting from a previous debate of this session?


Mitchell Frederick Hepburn: It hurts a little now,
does it?


Hewitt Bostock: The hon. member is not
in order in quoting from a previous debate during the same session.


Mitchell Frederick Hepburn: Very good, Mr. Speaker. But may I say that the hon. member for Bow River made a very compassionate appeal for the coal industry in his riding. He does not ask for the imposition of a duty, as hon. members opposite for the maritime provinces have the courage to do, but he asks that there be a statutory freight rate fixed for Alberta coal. I fear greatly for the political consistency of the free trader member for Bow River. I am afraid he is slipping. The technical experts of both our great transcontinental systems have declared that Alberta coal cannot be profitably hauled to Ontario at a rate that will allow it to compete in Ontario markets. Now, Mr. Speaker, I submit that there are few of us in this house sufficiently versed in technical railway matters to dispute their word. Again the Board of Railway Commissioners themselves, after a very careful investigation, with the assistance of able railway men, found that a fair rate would be $10.07 with actual out of pocket costs $7.22. And our hon. friend takes it upon himself to put these amateurs of railwa}' men on the right track. One thing about the hon. member for Bow River, he certainly is not suffering from that common ailment known as inferiority complex. I have here a clipping from the St. Thomas Times Journal which contains a character sketch ct the hon. member for Bow River. I do no'. know whether this information was supplied by the hon. gentleman himself but if he-was the publicity man, he did his duty welll The sketch tells how the hon. gentleman once hired out as a river driver without any previous knowledge of what a peavey or what a pike pole was. It is customary evidently for him to take on jobs he knows nothing about. I should like to remind him in passing that there is a very considerable difference between floating down a river on a log and trying to dictate to the heads of the great transcontinental railway systems of this country. After reading his speech, I was struck at what a loss this country sustained when we hired Sir Henry Thornton instead of the member for Bow River to
The Budget-Mr. Hepburn


Eccles James Gott: That is all rot. What has that to do with the budget?


Mitchell Frederick Hepburn: The Budget-Mr. Hepburn


Agnes Campbell Macphail: They were not- wild at all. They were just ordinary women.


Mitchell Frederick Hepburn: I should like now to deal with the budget itself. I am going to vote against the amendment of the hon. member for East Lambton (Mr. Fansher) because I do not hold' his extreme views, and I have more in common with the budget itself than with his amendment, although he probably moved it in all sincerity.
I am not so partisan as to say that I swallow the budget in. its entirety. I do not think any budget could be brought down that would suit any party or any ten members. You have to take the thing in a broad aspect. You cannot disagree on some minor points and agree on others. You are either for it or against it. I have every reason to congratulate the government on their splendid administrative record. I say in all sincerity and I believe I voice the sentiments of the constituency of West Elgin that the people there are in entire accord with the good administration of this government. It is pleasing to see our trade expanding, our debt and taxes being reduced and our prosperity increasing. These are factors to be taken into consideration before anyone think^ of voting against this particular budget. Because of the financial blunders of the Union government and the Borden government which preceded it, the soldiers who left our shores and fought in France, came back to find the country in debt for practically 100 per cent of the war. In fact these men had to share their burden of the tax for the salary of 11.10 a day which they drew while in the trenches in France.


Mr. ADSHEAD:: Fight and pay both.


Mitchell Frederick Hepburn: Yes. During the war millionaires in Canada sprang up like mushrooms and there should not be any undue haste in endeavouring to depart entirely from the principle of the income tax. These men should be made to bear a portion of the taxes for some time to come. I realize that there are reasons in favour of the abolition of the income tax. We know that while we can tax capitalists in this country, there is a great country to the south where taxation is lower and as there is no way of keeping them in this country and as there is a multiplication of income taxation here, municipal, provincial and federal, we have every reason to believe many of these men will go out of the country and be out of our sphere of taxation forever. That must be taken into consideration, but before any further move is made in regard to a reduction of the income tax, the matter

should be carefully considered because I happen at the present time to be sitting on a special committee of this house investigating the problems of returned soldiers and my opinion is that we are only on the fringe of what our pension bill will ultimately be. I think the hon. member for East Calgary (Mr. Adshead) who sits across the floor will agree with me that it has been the history of most countries that they do not reach the peak of their pension costs until many years after the war is over. I am not a pessimist, but I would not be surprised t-o see the pension bill of this country mount up to double the present cost and that within the next fifteen or twenty years. There are in Canada thousands of returned men whose health has been undermined by the hardships which they endured in France, and the government of the day, whatever it happens to be, cannot escape the responsibility of taking care of those men.
I want to deal for a moment or two with our friends of the official opposition. The chief criticism of our Conservative friends that is levelled against the government is the bugaboo about the emigration of Canadians to the United States.
It is true that in years past Canadians did go to the United States, and they will continue to go in the years to come. Likewise Americans have come to Canada in years past; I believe that since 1921, 169,000 Americans have come to this country, and I presume they will keep on coming in the future. I do not think there is anything to be alarmed about, because there will always be this exchange of people between the two countries. It is obvious that when we are enjoying good times in Canada, such as we usually do under a Liberal government, there is less likelihood of our people emigrating, and more likelihood of people immigrating to this country. I think if our friends of the official opposition are really sincere in their efforts to stop the exodus to the United States they ought to see to it that this government is kept in power for a long time in order that good times may continue, and not be interrupted by the advent of the Conservative regime.
We who live near the American border feel that the United States has reached the peak of her development; with her great man power and immense gold reserves, she cannot remain neutral. Capital will seek new fields for investment and labour will follow. In this regard I think the proximity of the United States to Canada is a great asset to us. Already in northern Ontario, northern Quebec, and in the west, principally in Manitoba, the mining industry is feeling the bene-

The Budget-Mr. Hepburn
ficial results of the influx of Americans and American capital. The immigrant who comes here from the United States with capital of his own, who comes unsolicited, is a very desirable immigrant. Only the other day I read that in the American west there were thousands of American farmers with capital only awaiting the coming of spring to move to western Canada and buy farms. For that reason I think the very friendliest of relations should exist, as they have in the past, between Canada and the United States. The bright star on the horizon for Canadian agriculture is the prospective market in the United States for our high class products. The United States is rapidly changing from a food-exporting to a food-importing country. I have a press clipping here which I shall not read because I do not like to have my hon. friend from South Essex glaring at me when I am reading-


Eccles James Gott: You have read it all.


Mitchell Frederick Hepburn: The Minister of Agriculture for the province of Ontario is what I consider a very candid Conservative, and I have a great deal of admiration and respect for him. He represents in the Ontario house the constituency next my own, and I value his friendship. Speaking in southern Ontario only a short time ago he said that he hoped the time would soon come when the tariff barriers between Canada and the United States would be swept aside because there was the future market for Canadian agriculture, and upon our ability to market our goods in the United States depended to a very great extent the prosperity of Canadian agriculture, fl rade figures show that we are becoming firmly established in that market despite the fact that we have the Fordney tariff applied against us because of the defeat of reciprocity in 1911. We are still suffering from the loss of that agreement. The question of improving trade relations between the two countries is of paramount importance, and for that reason I think it is of even greater importance that we should have in power in Canada a government which is on friendly terms with the American people and that we should see to it that our friends of the Conservative party who have been very prone to stir up international prejudice between the two countries are kept out of power. They coined a phrase in 1911, " No truck or trade with the Yankees." That jarred on American sensibilities. A few days ago we had a visit from Secretary Kellogg of the United States, and I was glad that while he was in the chamber no Conservative member was enunciating that part of the Winnipeg policy in favour of an all-Canadian waterway, in contravention of our international agreement established through one hundred years of common -usage. I was mighty pleased that the hon. member for Northwest Toronto (Mr. Church) was out of his seat at the time and was not delivering one of his usual orations in condemnation of our official representative at Washington. I was pleased also that a debate on the purchase of our legation at Washington such as we had last year was not taking place, because if anything ever cheapened the Conservative party in the minds of the American people it was the debate carried on here last year in opposition to the purchase of that legation. We all know that it was purely a business transaction which would have been carried out whatever government was in power, that even our friends across the floor would have done the same thing had they been in power The Conservatives used the purchase of that legation as a bit of propaganda, fanned the flame of opposition to white heat, and did not confine their opposition to this chamber, but broadcast their remarks all over the country.
A few nights ago we had a discussion in this house precipitated by the hon. member for St. Lawrence-St. George (Mr. Cahan) on the Chicago drainage canal. I am not allowed to read from Hansard, but I want to say that the leader of the opposition (Mr. Bennett) on that occasion dived into past history for the benefit of the present generation, revived the words of ex-President Roosevelt in connection with the famous Alaskan boundary dispute, when Roosevelt stated that if necessary American troops would be used to draw the line if other methods failed. That I think was very poor policy on the part of the hon. gentleman because his words would be broadcast all over the United States the next day. The feeling is growing in that country that the Liberal party in Canada is more friendly towards the people of the United States than the Conservative party, which never loses an opportunity to jar on the sensibilities of the Americans. I am very sorry that I am not allowed to read the very eloquent reply that was made at that time by our admired leader the Prime Minister of Canada. The viewpoint is now generally held among many classes of people in this country that such Tory tactics are poor business; I refer to the retail merchants, the wholesalers, and even the manufacturers.
Coming as I do from southern Ontario I know the magnitude of the American tourist traffic.

The Budget-Mr. Tummon


Mr. W. E. TUMMON (South Hastings):: Mr. Speaker, in taking part in this debate I purpose dealing with only one question. I wish to deal for a while with the movement of Canadians to and from the United States, and particularly so because in the budget speech delivered by the hon. Minister of Finance (Mr. Robb) on February 16 he declared that Canadians were returning home and that Canada was once more building solidly for the future. He wished, I presume, to convey the impression to this house and to the country at large that Canadians were returning in increasing numbers, and that that condition, if such condition exists, was the result of the policies of this government.
Not only is Canada in a unique position because of her situation alongside the highly developed industrial, commercial and agricultural country to the south of us, but also on account of the immigration laws of the United States. Under the strict quota law of the United States, immigrants are not allowed to enter from any other country to a greater extent in one year than two per cent of that nationality resident in the United States, as revealed by their census of 1890, with the exception of two countries, Canada to the north and Mexico to the south; and if newspaper reports are any indication it would appear that that quota law may soon be applied to Mexico and perhaps to Canada. For I believe that at the present time, there is a bill before congress which proposes to make the people of all countries in this hemisphere subject to the quota conditions. The Toronto Globe, in an editorial in its issue of February 28 last, after pointing out that the inclusion of Canada under the quota provisions, would probably reduce to one-third the number of Canadian bom going to the United States, gives its opinion of the effect upon Canada of bringing this country under the quota. It says:
In the long run the result would be the cutting off of Boston's export of shoes to Canada, of the silks, cottons and dress fabrics of New England, and the motor cars of Detroit, and the making at home of the goods that young Canadians now go abroad to produce. I he readjustment might be painful for a time, but Canada has had similar economic problems to face under the operation of the McKinley, Dingley and Fordney tariffs. If Canadian workers, as well as Canadian goods, are to encounter laws of exclusion, we shall find ways of living comfortably in a more self-contained way at home, and of competing effectively against American products in the open markets of the world. David's chances in that form of warfare are quite as good as Goliath's.
Now, I am not expressing any opinion as to the advisability or otherwise of Canada being brought under the quota law. I am

simply referring to the condition which the Globe pictures would happen if this country were so affected. If that is the condition that would follow here, then I wonder why we do not unite now to bring about that condition as the law is to-day without waiting seemingly to be forced into the position forecast by the Globe. It is the condition that we on this side of the house have been contending for and believe should! be maintained here in order to counteract the effect of the present United States quota law in its relation to Canada. I cannot, however, agree that such a readjustment might be painful, nor can I subscribe to the inference contained in the editorial that boots, shoes, silks, cottons, dress fabrics, motor cars, and other products of the United States should be permitted to come into Canada in exchange for the easy entrance of our native-born into that country. If that is the inference to be drawn, or if that is the condition to-day, then I think the exchange is most unbalanced, unfair, and wholly one-sided. I think, however, that the Globe in its editorial now admits that it is much better to build up a nation in Canada than to try to build up a nation elsewhere.
Coming back to the condition in Canada, as a result of the United States quota law, and without wishing to discuss the reasons which prompted the United States government to enact that law, it must not be forgotten that it created for us a condition which I think we cannot afford to overlook; for I consider it constitutes one of the most serious problems with which we have to contend. In short, the United States decided that she would no longer attempt to absorb unrestricted immigration, and she practically closed her doors, but she left the door wide open with respect to our native-born; for the quota applies only to those of our people who have become Canadians by adoption or naturalization. The result is that the United States opens its doors to our Canadian-born, the very type of citizens we must retain, if we are to maintain that strong British-Canadian sentiment that we so much admire and that is so essential to the full development of the Dominion. In other words, the United States are getting from this country the highest type of immigrant that it is possible to obtain-those bom on the North American continent, speaking the same language, and for the most part holding the same traditions and used to freedom of political thought and action along constitutional lines. In short, they are the most easily assimilated and the very highest type of citizen that any country could wish to

The Budget-Mr. Tummon
have. I repeat, sir, that this is one of the most serious problems with which Canada has to deal.
What is the government doing to cope with the situation? I have sat in this house going on three sessions, and I have yet to hear the Prime Minister (Mr. Mackenzie King) or any member of his cabinet say that they are doing anything to meet this problem-; a problem so grave that it demands the most serious attention not only of the government but of every member of this house. I do not believe the time will ever come when there will not be a certain degree of coming and going between the people of the two countries, but I do believe the number of native-born citizens that Canada has been called upon to lose to the United States during the past few years is out of all proportion to the number that one might reasonably expect to leave this country. At page 8 of the report of the Department of Immigration and Colonization will be found some figures of the number of Canadian citizens who, the department claims, have returned from the United States during the past three fiscal years. I have heard some comment outside this house as to just how much value should be attached to those figures, but they are the only records we have, and I am willing to take them for what they are worth. We are told that for the fiscal years 1925, 1926 and 1927 there have returned to Canada 125,971 Canadian-born, 13,915 British subjects who had acquired Canadian domicile before going to the United States, and 8,064 naturalized Canadian citizens-the total returning to Canada during that period being 147,953. We are glad to know that some have returned, but the trouble is that for every one that returns, from two to three are going to the United States. Wishing to know what the first ten months of this fiscal year would show, I made inquiries at the Department of Immigration and Colonization. I am told that for the ten months of this fiscal year, April 1 to January 30, a total of 35,405 Canadian citizens of all classes have returned. Knowing these figures, let us compare the first ten months of this fiscal year, 1927-28, with the corresponding ten months of the three previous fiscal years. In the first ten months of the fiscal year 1924-25 there returned 39,032; in 1925-26, 37,863; in 1926-27, 50,898; and in the first ten months of 1927-28, as I have stated, 35,405. This statement of the department shows that fewer Canadians of all classes returned to Canada from the United States during the first ten months of the fiscal year ending 1928 than in the corresponding ten months of any of the three
previous years: less than the corresponding ten months of 1924-25 by 3,527; less than the corresponding ten months of 1925-26, by 2,458; and less than the corresponding ten months of 1926-27, by 15,493.
Let us make a further comparison. In the absence of figures for February and March to complete the year 1927-28, let us take the average number who have returned in these two months during the three previous years and apply them to this year. We find it gives a total of 42,125. When all the figures for the year are available I think it will be found, indeed, that 42,125 will be more than the number who will have returned, for in the month of January just past there came back only 1,683, the smallest number to return in any one month since the Department of Immigration and Colonization undertook in April, 1924, to keep records. However, taking the estimate for the twelve months as 42,125, the comparison may be made as follows:	This year there will be less than
1924-25 by 1,650; less than in 1925-26 by 5,096; and less than in 1926-27 by 14,835.
This does not seem to indicate that Canadians are returning in increasing numbers, But these figures of the Department of Immigration furnish some further very interesting information. We find that, over the entire 46 months of which we have record, the months which show the largest numbers returning from the United States were the months from November, 1925, to September, 1926. You will recall that those were the months following the election of 1925, that election from which emerged the Conservative party with 116 members. In that parliament the Conservative party had the largest group and the indications were that before very long -it was only a matter of time-the party would be afforded an opportunity of putting its policies into effect. Canadians, therefore, began to return immediately thereafter, in increasing numbers and continued to return in large numbers up until the election of 1926, immediately after which they began to fall off. The election of 1925 took place on October 29 and in the first month following the election, November, 4,331 returned in comparison with 2,993 for October, while in December, the second month after the election, the number returning was 7,923. The records of the department show that out of a total number of Canadians who have returned to Canada during the past forty-five months about 35 per cent returned in the eleven months that separated the elections of 1925 and 1926.


Mr. FORKE:: What are you reading from?


Richard Bedford Bennett: Your report.

The Budget-Mr. Tummon


William Ernest Tummon: 
Mr. J. F. WHITE (London):: Mr. Speaker, in my contribution to this debate I wish to speak particularly with regard to the tariff changes which have been made at various times, and I desire also to make some comparisons of the results of these changes over a rather extended period. I was very much interested in the passages between the hon. member for South Essex (Mr. Gott), the hon. member for East Essex (Mr. Odette), and the hon. member for West Elgin (Mr. Hepburn) with regard1 to the steel industry, because I have also something to say in that regard. The differences of opinion which arose between the hon. members evidently had their foundation in the policy adopted by the United States Steel Corporation with regard to the question of manufacturing in Canada. I have here a copy of Hardware and Metal, a trade publication under date of February 25, 1928, and without comment I will read a news item which appears as coming from New York:
James A. Farrel, president United States Steel Corporation, commenting on Montreal despatches indicating that the corporation was establishing branches to make all their present products in Canada, said that such plans were not contemplated. The wire plant now being finished at Ojibway, Ontario, near Windsor, merely represents the removal of machinery from, and abandonment of the Hamilton, Ontario, wire plant.
Since 1922, when the present government assumed office, we have had seven budgets presented to this house. In each of these budgets changes were made in the customs tariff, the most notable being the changes in the textile items this year, the changes in the automobile item's of 1926 and the changes in the agricultural implement items of 1924. In all of these changes the tendency has been to lower the duty on the manufactured article and then to compensate the manufacturer by passing on the reduction to the makers of the raw materials entering into the finished article. In other words, the primary producers are

The Budget-Mr. White (London)
penalized. This year the change has been made in the textile group, and it is rather hard to say just what the result will be; I suppose time alone will tell. As far as I can judge, some kinds of cotton products have received an increased protection, while wool, which was reduced some years ago, has suffered a further reduction, this year. It would appear that these changes will make it harder for Canadians to carry on business and will perhaps restrict the spinning of yam, since yarn is on the free list. If the production of spun yarn declines, of course it means the curtailment of labour and additional unemployment, and the Canadian farmer also loses part of the market for his wool and his foodstuffs in industrial centres. Thus, Mr. Speaker, the need for wider markets becomes apparent, and it is questionable whether the consumer will benefit in the long run by these changes. I am unable to say, and I do not believe anyone in this house can say, how it will work out.
Now I wish to refer to the changes which were made in 1926. In that year the automobile duties were reduced on cars valued at SI ,200 and less by 15 per cent and on cars over that figure by 7J per cent. Then, meeting with much opposition from the manufacturers of automobiles and also from labour, the government softened the effect of the change by a 25 per cent drawback on all material entering into the manufacture of cars, also abolishing the 5 per cent luxury tax. The net result was that the automobile manufacturers were left in almost the same position, with the duty reduced by perhaps 5 per cent, and the blow fell on the producer of the raw material, as in other cases which I will cite later. The loss of the luxury tax affected the public treasury also, of course. This is just another case of passing the loss on to the primary producer, but in spite. of all this our production of automobiles fell off by 13 per cent last year, while our importations increased by 28 per cent and our exports declined by 23 per cent. It has been said that the decline in the production of automobiles last year was due to the fact that the Ford Motor Company was not producing automobiles. That is a very interesting explanation of the case but it hardly stands inspection, because in 1925, before the reduction in the duty, there were 8,800 automobiles imported into Canada, while in 1926, eight months of which came after the budget of 1926 was brought down, reducing the duty, our importation increased to 14,900 automobiles, or an increase of 70 per cent. There is no doubt that in the history of nearly every industrial activity there comes a time, after it becomes firmly established, when duties may be reduced, and it may be that in time the reduction in the duty on automobiles will be a benefit to the industry and to the consumers generally. Our short experience, however, from the date of the budget which reduced the duty on automobiles until the present, is not very reassuring.
Hon. members on the other side of the house refer with a great deal of satisfaction to the reduction in duty on automobiles. One of them, in his enthusiasm, said the duties had been reduced and there were now more cars in Canada than ever before, but he did not say where the cars came from. The questions for Canadians to consider are where the automobiles come from; whether Canadian materials entered into their production; how many Canadians earned a livelihood from their manufacture and how many more Canadians might have been employed if this importation had not taken place. Other questions are whether the purchase of more cars abroad helped create an adverse financial balance; whether it built up foreign industries at the expense of our Canadian industries, and whether it tended to restrict the demand for foodstuffs in Canadian cities. There is still another question; did the purchase of these automobiles abroad create a reciprocal market in the country from which they were purchased? .No, Mr. Speaker; the market was largely closed to us by the Fordney-McCumber tariff, and by more recent increases, so that at present Canadian farm products are to a great extent refused entry into the United States, and the amount marketed there is but a fraction of what it was in 1921. I would refer the house to the Commercial Intelligence Journal of February 25 of this year, a publication of the Department of Trade and Commerce, which shows, in a long list of products of the farm, our loss dm this market. In the month of January, 1921 our exports Of farm products to the United States were valued at $12,650,000, while in January, 1928, that figure had dropped to $2,870,000. It also shows that in the year 1921 our sales to the United States were $108,346,000, and in the year 1928 they had dwindled to $30,701,000, or a loss of the market to the extent of 87.3 per cent. The Canadians take the rebuff without any apparent sign of protest, and they continue to buy in the United States, as they did last year, to the tune of an adverse balance of trade amounting to $232,000,000.
Now, Mr. Speaker, I wish to speak about the reductions in the budget of 1924, and they concern particularly the reductions on agricultural implements. On account of the lapse of time a comparison of prices may give us a better appreciation of the general effects
972	COMMONS
The Budget-Mr. White (London)
of the changes made by that budget. Hon. members who were in parliament in 1924 will probably remember the debate on the budget of that year and the protest of the then Liberal member for Brantford against the reduction of duties. He, it will be remembered, in common with the present Minister of National Revenue (Mr. Euler) and some other members of the Liberal party voted against their party on that budget. The then member for Brantford stated that he considered the tariff was at the irreducible minimum without the reductions then proposed, and it seems as though subsequent events have confirmed that view. The Liberal government came into power in the last few days of 1921 or the early days of 1922. There has been an all round reduction in 1924 of the customs duties of from 5 to 12J per cent on agricultural implements. By the same
Binders and mowers:
Duty was reduced by Liberal government in 1924 from 10 per cent to 6 per cent and sales tax abolished.
Cultivators, harrows, rakes and drills:
Reduced from 12J per cent to 7J per cent, and sales tax abolished.
Drills:
Single disc, 13 disc-2 horse.
Western-20 marker combination.
10 ft., horse, dump rake, 32 teeth.
Hay tedders and hay loaders:
Duty reduced from 15 per cent to 10 per cent, and sales tax abolished.
Ploughs:
Duty reduced from 15 per cent to 10 per cent and sales tax abolished.
Land rollers:
Duty reduced from 15 per cent to 10 per cent, and sales tax abolished.
Farm Wagons:
Duty reduced from 17J per cent to 10 per cent, and sales tax abolished. * I
This list includes a list of twelve machines of average size and those largely used by Ontario farmers. The total selling price of the list in 1922 was $1,384.50 and in 1928, $1,420. This is an increase of about 2i per cent, in spite of the reduction in duty and the removal of the sales tax.
The question of the cost of materials, the cost of steel, the cost of labour, may be raised.
I would say that they were about the same when this budget was brought down as they were in 1922. Steel on the basis of Pittsburgh prices is a little higher while labour is a little lower, but on the whole together they are about the same. Many claims have been made from the other side of the house as to

budget, the sales tax, which in 1922 stood at 3 per cent, was abolished. Various materials used in the production of these implements have been reduced to a 6 per cent duty, including bolts and nuts, paints and oils, canvas and things of that kind. Iron and steel used in manufacture were placed on the free list or subject to a 99 per cent drawback. Most of the articles affected were placed on the free list. What is the result? To-day agricultural implements are selling at quite as high or at somewhat higher prices than were charged in 1922 when the Liberal government came into power. In order to demonstrate this, I wish to read the following comparisons of prices, and I may say that these are Ontario prices for deliveries at London, Hamilton and Ottawa, and they are taken from the price list of the International Harvester Company.
1922	1928
7 ft. binder-no attachments	$235 00	$237	006 ft. heavy mower	99 00	98	506 ft. cultivator with 9 stiff	teeth	92 00	96	007 ft. harrow-14 disc-3	horse	62 00	66	00147 00	154	004 pulley hitch	214 00	232	0052 00	54	00Combined side rake and	tedder	121 00	131	50Hay loader, steel windrow,	with forecarriage.. ..	116 00	125	00No. 121 walking plough-	9" share	23 50	21	508' 2" wide	113 00	98	00Wagon-31 skein 21 x 1	tires	110 00	107	00
reductions in the price of agricultural implements. I am not dealing with the increases that occurred during the regime of the Liberal party: I am not dealing with the 100 per cent increase they put on the sales tax, but I am comparing the prices of 1922 with those of the present date.
I should like to make a little further comparison as to the trend of the agricultural implement business and then consider the effect of the tariff on the primary industries or those which supply the raw material to manufacturers of implements. The fact that we imported in 1927 the largest amount in dollars' worth of agricultural implements in our history aroused my curiosity as to what pro-

The Budget-Mr. White (London)
portion of Canada's needs we were supplying from Canadian factories. The bureau of statistics keeps a record of the value of farm implements made, and a record of exports and imports. Without encumbering Hansard with needless figures, I should like to quote the result of my comparison in percentages. I found that in 1922, the year in which the Liberal party took office, Canada had supplied herself from 'her own workshops with 63 per cent of the agricultural implements she used and consequently she imported 37 per cent.


Richard Bedford Bennett: Is that the calendar
year?


John Franklin White: The fiscal year.
As the manufacturers' records are not complete for 1927 I was compelled to take the figures for 1926, and I found that whereas in 1922 the percentages were 63 per cent for Canadian manufacture and 37 per cent for imports; in 1926 goods of Canadian manufacture used in Canada amounted to only 54 per cent of the total while imports had risen to 46 per cent. There should be a great deal of significance in these figures. There was 9 per cent less manufactured in Canada or just that much more lost to the Canadian, workmen and manufacturing establishments, particularly to the workmen, as I shall try to show a little later on. There was 9 per cent more of our needs imported, and yet agricultural implements were no cheaper in 1926 than they were in 1922, in which year we manufactured 63 per cent of our requirements. That is the record as regards agricultural implements to the end of 1926. In 1926 imports and exports of agricultural implements stood at about the same figure, or at about 813,000.000 for each, but in 1927 our imports increased to over $26,000,000, exceeding our exports by $9,500,000. It will be no surprise to me if, when the figures for 1927 are completed, the proportions will be about fifty-fifty-in other words, that Canada is supplying herself now with only one-half of the agricultural implements she uses.
While we have many Canadian manufacturers making agricultural implements, there are two very large companies which are outstanding and which make the bulk of the production. I refer to the International Harvester Company, which has a branch factory in Hamilton, the main office being in Chicago, and to the Massey-Harris Company of Toronto, which has a factory at Batavia and which has recently acquired the J. I. Case Company of Racine, Wisconsin.


Richard Bedford Bennett: Also one in France.


John Franklin White: One in France, and also one in Australia. That was due to the Australians imposing a heavy duty on agricultural implements, so that the Massey-Harris people moved to Australia and started manufacturing there. In view of the fact that the Canadian activities of these companies are merely branch plants, it does not make any particular difference to the companies themselves whether their manufacture of implements is carried on in Canada or in the United States. There is no doubt they will carry it on in the cheapest market.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


John Franklin White: Mr. Speaker, when the house rose at six o'clock I had completed that part of my remarks in which I showed that notwithstanding the reduction of 5 to 12J per cent in duty and the abolition of the sales tax on agricultural implements by the budget of 1924, the price of implements to-day is higher	than it was	in	1922 when theLiberal	government took	office.	My purpose was to show that when duties are reduced beyond a certain point there is no benefit derived by the consumer, and also that it may and does do harm to many of the industries concerned.I wish to proceed a little further and consider the effect of the tariff reductions of 1924 on the manufacture of steel and goods of that sort used in	the	making	of implements.	Pig iron and	rolled steel,	of course,
are the principal raw materials for the manufacture of agricultural implements. There is also a long list of small items in which steel plays a very large part.
The ordinary general tariff on steel is $7 per ton. It is a specific duty; it doe's not vary with the price. Prior to 1924 many items had been reduced from time to time until the duty on steel for agricultural implements for domestic use had been reduced by drawbacks to 30, 40 and sometimes 50 per cent, to about $4 per ton. The steel used in making agricultural implements for export was subject to a drawback of 99 per cent. By the budget of 1924 all the steel used in agricultural implements was put on the free list, and all other materials such as bolts, rivets, canvas and things of that kind were put in an item covered by six per cent duty. From this side of the house we protested against that reduction, claiming that it was excessive, that there had been no comprehensive study made of the whole situation, and advising the ministry of the damage we thought would be done to the Canadian iron and steel industry.
974	COMMONS
The Budget-Mr. White (London)
No claims had been made as to excessive profits being made, and there had been no complaints, so far as I know, as to there being any combination in restraint of trade in that industry. The government, however, at the instance of the Minister of Finance, swept away the small duties that still remained, with the result that thousands of tons of steel, which mills in Canada are equipped to make, came and are still coming into this country. In the fiscal year ending March, 1925, steel under tariff item 445a came into Canada to the amount of 14,460 tons; in 1926 that had increased to 43,700 tons, in 1927 about the same amount, and for the ten months ending January 31st of this year the imports were
39,000	tons, or at the rate of 47,000 tons for the year.
In addition to that, materials on the six per cent list, largely made of steel, have been coming into Canada during all these years at the rate of about $2,500,000 per year, and last year the figure was $2,600,000, if I remember correctly.
All this has had its effect upon the unemployment situation and its effect upon the migration of our people. The loss which has been suffered by the steel companies is another item which must be reckoned with.
The maritime steel and coal situation has been pretty well discussed in this house and I think hon. gentlemen are fairly well conversant with it, but besides the companies in the maritime provinces there are two other large producers of steel in Canada, as well as many smaller mills scattered throughout the Dominion. One of those larger mills is the Lake Superior Corporation, which has been struggling for years, and last year showed a substantial loss. The other large producer, the Steel Company of Canada, is the only one in the industry in Canada which seems to be making progress. That company is a combination of fourteen or fifteen different companies which before their amalgamation were competing with each other for the Canadian business. A merger or trust, if you like, was formed. Of course I know these words are anathema to Liberals and Progressives alike. We have heard them get up in this house and rail against combines, mergers and trusts, and yet they are quite ready, when the steel industry is concerned, to get up and quote the Steel Company of Canada as a reason why the steel business in this country needs no consideration.
The Steel Company of Canada manufactures many lines from pig iron through all the various operations, including steel ingots, bars, pipe, wire, horse shoes, bolts and nuts, nails, screws, tacks and lead pro-
ducts. Many of these lines have not been affected by the tariff changes. For example, wire nails still pay a duty of $12 per ton, pipe a duty of 30 per cent, and tacks 35 per cent. The Steel Company of Canada also have practically free entry for their fuel. It comes in subject to a drawback of 99 per cent 'under tariff item 1019 for the manufacture of coke to be used in the melting of metals. The company make coal into coke, and in the process gas, of course, is generated. This gas is used to reheat their steel for use in the finishing mills, consequently they get their fuel in free of duty. There is another thing possibly in their favour. They bring the iron ore down the lakes to Point Edward and then transport it by rail to Hamilton, a distance of about 140 miles, and in so doing I am told they have a very favourable freight rate, in fact the lowest freight rate per ton mile on the American continent. It is so low that even if anything like an approximate rate could be applied to Alberta coal the very optimistic computation of the hon. member for Bow River (Mr. Garland) might be realized. And yet the Steel Company of Canada with all these advantages cannot stem the ever-increasing tide of imports, records of which appear in the government statistics.
Now, Mr. Speaker, just a word on the production of pig iron and steel in Canada. I will compare the production of last year with that of 1913, the year before the war, to show our relative position to-day. In 1913 our pig iron production was 1,015,000 tons; in 1927, 710,000-a decrease of 30 per cent. In the same period the United States increased their production by 27 per cent. In ingots and castings the figures are similar; our production declined 26 per cent while that of the United States increased 45 per cent. Our trade balance in iron and steel with our neighbours is distinctly and increasingly adverse. In 1925 there was an adverse balance of $53,000,000; in 1926, $87,000,000; in 1927, $175,000,000.
In view of this it is pertinent to ask, what solution has the government for this situation -a situation largely induced by its own ill-advised acts. So far as I can discover they offer no solution. They have treated the basic industry of manufacturing iron and steel to drawbacks of duty on automobile materials; 99 per cent drawback on spring steel for automobile springs, and 25 per cent on all other steel. They have also put agricultural implement steel on the free list. We on this side of the house have entered our protest repeatedly against this policy. The report of the Duncan commission, issued on September 23, 1926, urges action, and I should like to

The Budget-Mr. White (London)
quote section 25, which will be found at page 37 of the report. It is headed, Steel and Customs Tariff, and is as follows:
It was submitted that the tendency of the tariff, as affected by successive alterations, has been to lessen the protection upon the primary products of iron and steel and to encourage their importation from other countries as being the raw materials of iron and steel-fabricating and finishing industries in Canada.
In respect of this matter, we do not conceive it to be our duty to express any opinion, since the question is, as we were informed by the chairman of the Tariff Advisory Board, who met us at our request, at the present moment under the consideration of that board. But we do regard it as our duty to record that the significance of this industry to the maritime provinces was forcibly brought home to us, not only in the manufacturing towns we visited in the maritimes but also throughout the agricultural districts of the maritimes. We record this in order to emphasize the need for prompt action.
Now, Mr. Speaker, after the lapse of one and a half years from the date of that report the government have advanced no remedy for the situation, they have not even shown a disposition to retrace their steps, and in the nature of things it will be another year before any relief is in sight. It is quite possible that some of those interested in this basic industry will have passed out of the picture before any relief arrives. But perhaps I should make an exception in favour of one member of the government, the Minister of Trade and Commerce (Mr. Malcolm). He has suggested that British manufacturers might establish branch plants in Canada. I should like to direct the hon. gentleman's attention to the case of one British company that made the experiment, At the close of the war the Baldwin Steel Company, who have been manufacturing steel sheets in Swansea, Wales, for half a century, installed a sheet mill in Toronto. They found on proceeding to manufacture and market their product that it was an unprofitable venture, on account of steel sheets for galvanizing being on the free list. Thereupon they shut down the plant, and it remained idle for about three years. In 1925, despairing of any tariff relief, they scrapped part of the plant, and last winter they took out the mills and shipped them to England. Now, if Canadians cannot make a success in this basic industry, it would appear from the experience of the Baldwin Company that an English branch factory has no better chance of success here.
I have previously referred to the fact that coal is allowed into Canada free of duty for making coke. This is not an advantage to Nova Scotia. There are only two steel mills concerned in this particular item, and they have the benefit of practically free entry for
their coal-a 99 per cent drawback. There are other smaller mills in Canada which compete with these two large concerns, and they have to pay duty on their coal. The fact is that no coke is used in their process, and so they cannot come under the drawback provided for in item 1019. One of these concerns is in my city, and the other is in Selkirk, Manitoba. Up to 1925 the duty on bituminous slack coal was 14 cents per ton. During that session it was increased to 50 cents per ton, and the Minister of Finance stated that he expected this would provide about a million dollars additional revenue. This, of course, was for the most part a burden put on Ontario, but Ontario accepted it without a murmur. Alberta coal has been tried out by the Manitoba concern and found to be unsuitable. They and the other smaller mills use United States coal, and so they have now to pay a duty of 50 cents per ton and compete in the market with the larger mills that have free entry for their coal. This is not just; it is a discrimination as between plants in the same lines of business. In company with hon. members from Winnipeg and the hon. member for Selkirk I have made representations to the Minister of Finance and urged him to bring down some measure to relieve the situation. I hope when the resolutions are being considered that an additional resolution will be introduced by the minister for the purpose.
Now, Mr. Speaker, the government have expressed no concern as to unemployment. There are no items in the budget to provide any relief, and in the speech from the throne they were silent on this subject. It seems to me that proposed reductions in the tariff are about all the answer the government have given to the request for jobs on behalf of our unemployed Canadians. This, of course, brings the matter closely to the amendment moved by the hon. member for St. Lawrence-St. George (Mr. Cahan). It is becoming a by-word amongst the smaller communities and amongst industries, that as soon as the budgets of the present Minister of Finance are brought down these communities and industries which have not been interfered with breathe a sigh of relief.
I am sorry, sir, that my time is exhausted. I had other items to bring to the attention of the house, but I will deal with them on some other occasion.


Mr. R. K. ANDERSON (Halton):: I fear
I cannot compliment the Minister of Finance (Mr. Robb) on the presentation of his fifth budget. When I listened to him as he delivered that budget I felt that it was a rather
976	COMMONS
The Budget-Mr. Anderson (Halton)
innocent document, but on reading it over carefully I discovered that it had potentialities for good and evil, and after studying a little more carefully I decided that the evil predominated. Now the public of Canada are studying budgets a little bit more than they used to, and well they may, because the budget has become an instrument in the hands of the minister to make or break people in their struggle for a living.
The budgets of the present Minister of Finance have two striking characteristics that did not appear in the budgets of previous ministers in that office. They are characteristics that are very disturbing to business men, characteristics that drive capital into hiding and retard progress. The first to which I refer is the instability of the tariff. It has become proverbial that no longer have the business men of Canada any security or any idea what the budget may bring forth each year. In 1923 the Right Hon. Mr. Fielding, in delivering his budget, pointed out how essential it was to have tariff stability. At page 2848 of Hansard of that year he is reported as follows: "It is desirable that an assurance of tariff stability should be given to business men ***** I think that the tariff as it now stands is fair and reasonable and business men should be able to carry on without the fear of further changes." That is not the condition to-day. It would appear to me that the Minister of Finance has lost his perspective in relation to budgets. He fails to visualize Canada as a whole and to make his budget in the interests of the country. The budget is in his case framed entirely for political effect in the interests of the present government, of which he is a member. Business men throughout Canada will not remain in business under present conditions. Men of ability and of business foresight prefer to watch and wait, to' put their capital in hiding in some safe place rather than to use it in expanding industry in this country.
The budget of the Minister of Finance reveals another characteristic, the second one, which to my mind is serious from the standpoint of Canadian industry. The minister has a peculiar habit of paying unwelcome compliments to the industries of Ontario every second year. In 1924 he attacked the agricultural implement industry, and one peculiar fact about that incident was the very docile manner in which the affected industry took the reductions in the tariff. They made no particular protest, which created in my mind the suspicion that they knew what was coming. Some engaged in that industry were very near to the government and it would

seem that they got an inkling of what was about to happen and therefore began preparing for the event from 1922 to 1924. Later on I will give my reasons for so thinking. In 1926 the blow came to the automobile industry; it came like a bolt from the blue. There was consternation and the automobile manufacturers came to Ottawa and made their peace with the Minister of Finance, a peace that was satisfactory to him and expensive to the industry. Now in 1928 the textile industry is attacked. In 1923 an increase of 10 per cent in the British preference was given, which had a serious effect on the textile industry of this country, and in 1928 this second attack will be injurious to certain sections of the business. I intend to show that these are largely Ontario industries that are receiving the unwelcome attention of the Minister of Finance and of the government.
Speaking of the attentions of the Minister of Finance to the province of Ontario, it would seem to me that statesmanship is at a rather low ebb in Canada if a province like Ontario or any other province is to be coerced in this manner and used for political purposes, merely because that province is not sending to this government the support which they think it ought to send. I would ask the Minister of Trade and Commerce (Mr. Malcolm), if he were in his seat, a gentleman who enjoys a protection of thirty per cent on his own industry-


An hon. MEMBER:: Thirty-five per cent.


Robert King Anderson: No, thirty per cent, I think, on the manufacture of furniture. I say I would ask that gentleman how he can consistently remain in the present government and see other industries treated differently from his own. The Minister of National Revenue (Mr. Euler) has spoken in this house on various occasions and he appears to be consistently in favour of protection, particularly on industries in his own constituency. I believe he is a protectionist. I would ask him also how he'can consistently stay in the government while reductions in duty on various industries in Ontario are being made for political reasons. I do not know how the Minister of Public Works (Mr. Elliott) feels about it; I do not know whether he is a free trader or not. He also, however, comes from the province of Ontario. I say therefore that these three men ought to raise their voice in protest against the treatment which the province of Ontario has been receiving.
I remember quite well, when the present Prime Minister (Mr. Mackenzie King) came into this house in 1920 as Leader of the Opposition, how he raised his voice many a time

The Budget-Mr. Anderson (Halton)
declaring his ultra democracy, telling the house what a democrat he was. He believed that the people should rule. Yet in eight short years he brandies out as an autocrat, trying to coerce Ontario through the Minister of Finance. The Globe newspaper, for nearly fifty years, has carried on one of its pages this dictum of Junius:
The subject who is truly loyal to the chief magistrate will neither advise nor submit to arbitrary measures.
Yet we find the Prime Minister and the Minister of Finance using arbitrary measures on the province of Ontario.
The reductions which we find in this budget contain nothing at all for the average man in this country. Any one fortunate enough to enjoy a personal income large enough to come under the provisions of the income tax act is quite willing to pay that tax, but as there are only comparatively few of these people in Canada that particular reduction helps no one who really needs help. We can say the same thing about the sales tax; the reduction of one cent on the dollar may help the retail trade but it will never reach the ultimate consumer and he will reap no benefit from it whatever. The labouring man, the artisan, the farmer and the professional man will not be helped in any way by this reduction in the sales tax. Therefore these two items are of no interest to the average Canadian. The Minister of Finance stressed the fact that he was reducing taxation in Canada, stating that $19,000,000 would be handed back to the people this year. Not a cent of that money will go back to the average man, who really needs the reductions. Those who will be benefited are those who do not need help.
With regard to the claim made by the government that they have reduced taxation I wish to submit a comparison of the taxes levied by the Conservative government in the five-year period previous to 1922 and those levied by the Liberal government for the five-year period subsequent to 1922, leaving that year out of consideration. According to the consolidated revenue fund, which represents the taxation levied upon the people of Canada, the figures are as follows:
Conservative
government
1917..	$ 232,701,294
1918..	260,778,952
1919..	312,946,747
1920..	349,746,334
1921..	434,386.536
$1,590,559,863 So, in comparing will be seen that 56103-62
Liberal
government
1923..	$ 394,614,900
1924..	396,837,682
1925..	346,834,479
1926..	380,745,505
1927..	398,695,776

five-year periods, it Liberal government
extracted from the pockets of the people $327,168,479 more than the Conservatives, which is equal to $179,270 for every day the Liberal government were in office. That does not 'look very much like a reduction in taxation, nor does it look very much like economy, because the government spent all that money in conducting the business of the country.
Every time this government change the tariff they stimulate the importation of foreign goods into Canada and thus injure our own industry, while every reduction in duties is followed by a flow of emigrants from Canada to some other country, in search of work. This government appear to me to be implementing their tariff policy of 1919, in which they said they believed in a reduction of the British preference to 50 per cent of the general tariff; I believe the Minister of Finance is at that point now, and in some instances is below the 50 per cent level. I believe he is going still further in the direction of the Progressive policy of free trade with England; at any rate, he is nearing the point where we shall have a tariff for revenue only, which appears to be the Liberal policy to-day. Not only is the minister making reductions in the general tariff; he is also going around to the back door and giving preferential treatment to certain favoured nations, something of which the people are scarcely aware.
In connection with this budget there are certain things which particularly affect my own county of Halton. There is a little item in the tariff which will have the effect of giving an 80 per cent drawback on certain papers used in the publication of magazines. In this province we have mills which manufacture coated paper suitable for magazine publications. This is largely an Ontario industry, and in 1925 the duty was 35 per cent. An 80 per cent drawback will reduce that protection to 7 per cent. Ontario produces 66.3 per cent of this material, the balance coming from Quebec and New Brunswick, so it is a matter of vital importance to this province. These mills are seriously affected by this budget; their protection is practically eliminated, and I would suggest that the government give very serious consideration to the representations which I understand these manufacturers are making. We have a coated paper mill in the county of Halton; it is an important industry there, with quite a large number of employees and having a considerable amount of capital invested in it, and if this budget goes into effect it is possible that that industry will go partly out of business. I believe the manufacturers of this product have presented their case to the tariff advisory board, but in spite of their representations that board has

978	COMMONS
The Budget-Mr. Anderson (Halton)
recommended this reduction, to the government. Probably that is only to be expected, when you consider that at the head of the tariff board is a man who has free trade ideas, and who probably thinks of nothing else.
We also have three woollen mills in my county, and one of these will be seriously affected by this budget. I have mislaid my notes and a letter in this regard, but the factory to which I have reference is a spinning mill in my own town. The reduction in the duty on dry spun yarn and the free importation of yarn will injuriously affect that industry. They manufacture yarns, woollens and worsted yarns for the manufacture of carpets and so forth. The manager claims that this will take away almost their total protection, that he is hampered under existing conditions, that he has lost two large orders for the present year because he could not meet the British price. Wages in that particular industry in England are about $5 per week, while in the same industry in Canada the wages are $10 per week. This is a very serious handicap and that industry is unable to meet the competition coming from the old land. This loss of business is going to be seriously felt. Quite a number of families will have no means of earning a living; they depend for a livelihood upon that industry in that particular town. It is a very serious matter for them and I too would ask the government to take into their earnest consideration the representations made on behalf of that industry before the tariff advisory board showing the conditions under which they are operating in Canada. It is worth while for the government to consider these representations, because although the industry is in the province of Ontario it represents 82 per cent of the business in the whole of Canada.
Then we have another industry in the province of Ontario with which I intend to deal, although the conditions with respect to it were very fully explained by the hon.
member for London (Mr. White). My hon. friend is an expert in regard to the iron and steel industry and so was able to speak with authority upon this subject, but I will present the view of the man on the street who does not understand the industry, and I will try to show how the conditions affect the average farmer who buys the implements made by the agricultural implement industry, which is largely an Ontario industry. The capital employed in this industry in Canada in 1921 was $100,285,000, and in 1925, $81,861,000, a decrease of $18,424,000, as a result of the tariff policy of this government. The number of factories operated in Canada in 1921 was 90. The number operated in 1925 was 61, a reduction of 29. In 1921 the employees numbered 9,198 as against 7,669 in 1925, a decrease of 1,529. In 1921 the amount paid wages was $11,805,000 as against $9,089,000, a reduction of $2,716,000, largely in the province of Ontario.
Taking up the matter of production in Canada-and I am taking this from page 102 of the iron and steel report of the bureau of statistics for 1925-the production in Canada in 1920 amounted to $50,301,000. In 1925 the value had dropped to $24,770,000, quite a large reduction. The capital invested in 1925 amounted to $81,861,000. Of the factories operating in Canada in 1925, 43 out of 61 were located in the province of Ontario. Out of the total number of 7,559 employees in all Canada, 7,143 were employed in Ontario, or 95 per cent of the total. Of the total capital of $81,861,000, the capital invested in Ontario amounted to $79,115,000, or 97 per cent. Out of a production of 24,770,000 for the whole of Canada the production in Ontario was
23,311,000,	or 95 per cent, showing the extent to which the industry is an Ontario one.
Now in order to make a comparison of the prices of agricultural implements between 1921 and 1926, the following table is interesting:

The Budget-Mr. Anderson (Halton)



RETAIL PRICES OF AGRICULTURAL IMPLEMENTS

[Stage Direction]
Implement	Price 1 payment Oct. 1st, 1921	Duty	Sales tax	Price i cash; one payment Oct. 1st, 1926	Duty	Sales tax	IncreaseSix ft. binder	% cts. 219 00	per cent 121	per cent 3	$ cts. 230 00	per cent 6	nil	$ cts. 11 50Mower, 5 ft., heavy	93 00	12)	3	96 50	6	3 50Mower, 6 ft., heavy	95 50	121	3	98 50	6	3 00Reaper, 5 ft., 2 horse	135 50	121	3	138 00	6	[DOT][DOT]	3 00Horse dump hay rake, 8 ft., 26 teeth, steel wheels	47 00	15	3	50 50	71	«	3 50Hay tedder, 8 fork	82 00	20	3	85 50	10	u	3 50Hay loader, steel windrows,	112 00	20	3	125 00(26) 123 00	10	11 00Manure spreader, 2 horse, No. 5	187 00	15	3	171 00	71	(decrease)	16 00Hoe drill, 2 horse hitch	125 00	15	3	131 00	71	nil	6 00Field cultivator, (j ft., 12 spring teeth, 2 or 3 horse....	77 00	15	3	82 00	7)	<<	5 00Land roller, 6 ft. 27 in	63 00	20	3	68 00	10	5 00Disk harrow, 12 disks, 16 inch, 2 horse	45 00	20	3	50 50	10	5 50
Now the situation which these figures disclose is somewhat peculiar. I have placed these figures on Hansard to show just how much benefit the farmers of the Dominion of Canada received from the reductions in duty and the elimination of the sales tax as between 1921 and 1926. It is very interesting reading indeed and it requires some explanation, not only from the government but from the industry itself. The question will naturally be asked what the cause was of the increase in prices in those years. That is why I say there is some suspicion that the implement industry had some knowledge of what was going to happen. Prices increased very materially between 1921 and 1924. The following figures compared with those already given indicate the increase of price:
Price List of November, 1923 (One-quarter cash, balance October 1st)
Binders, 5 ft	
$253	00Binder, 6 ft	
253	00Mower, 5 ft. heavy	
105	00Mower, 6 ft heavy	
107	00
Horse dump rake, 8 ft., 26 teeth steel
wheels	
54	50Reaper, 5 ft., 2 horse	
153	00Hay tedder, 8 fork	
92	00Hay loader, steel windrow and forecarriage	
130	00Manure spreader, 2	horse	
187	00Hoe drill, 2 horse,	11	
147	00
Cultivator, 6 ft., 12 spring teeth, 2 or
3 horse	 90	00
Land roller, 6 ft. 27 in		77 50
In 1924 the government gave the manufacturers the advantage resulting from reduction in duties and the removal of the 5 per cent sales tax, but it is evident that the manu-
56103-62J
facturer did not pass along to the farmer the reduction of the customs duties in 1924 nor since.
Now as to iron and steel products. I had the curiosity to look up the prices between 1921 and 1924 and I find on page 46 of the publication of (the Dominion Bureau of Statistics, Iron and Steel Products of 1925, the following, giving the average index number of prices for the years 1921 to 1925 for all steel products that went into the manufacture of agricultural implements. In 1921 the average price was 185.7. In 1922 it was 151.8; in 1923, 168; in 1924, 161; in 1925, 151.4. That is the index figure in 1921 was 185.7 as against 161 in 1924, or 24.7 higher in the former year than in the latter. Does that look as if agricultural implements should have been higher in 1924 than they were in 1921?
Mr. EVANS:: Who furnished those figures?


Robert King Anderson: I just told the hon. gentleman, if he had been listening.


John Evans: I was not in at the time.


Robert King Anderson: 
Mr. D. J. COWAN (Port Arthur-Thunder Bay):: Mr. Speaker, my contribution to the debate on this occasion will perhaps be somewhat coloured by my residence in northern Ontario in the heart of the mineral area which is now producing practically untold wealth for the people of this country. Hon. members who have had an opportunity of travelling across Canada will no doubt have noticed that large extensive territory apparently barren

The Budget-Mr. Cowan
and forbidding in appearance but most inviting to those who live there, in the northern part of Ontario from North Bay across country to the boundary of Manitoba. Hon. members and delegates Who attended the Winnipeg convention would have an opportunity of seeing that territory. I refer by the way to that great convention where we selected not only our leader but the gentleman who will be the next prime minister of Canada.
The scarcity of ideas on the budget, conjoined with the anaemic character of the speech from the throne, gives the opposition very little opiportumity to discuss to advantage the public questions of the day. Perhaps this government is in the rather unfortunate position of having applied to it the time-honoured saying of Hooker, "that even ministers of good things are like torches, light to others, but waste and destruction to themselves". It appears to me from my examination of the budget that this government is beginning to look backwards instead of forwards, and in a young country such as ours with the mineral and agricultural wealth we have to be developed, the government I think should have some suggestion which might be made use of in further developing and enriching this country. At the risk of repetition and being tedious I desire to offer some contribution to this debate in the course of which I shall make suggestions which I hope the government will see fit to adopt. I care not who gets the credit for it; I am only anxious that the mineral wealth of northern Ontario should be developed.
That northern country hon. members do know has come into prominence during the last few years. It is only a matter of a few years since even as wise and efficient an administrator as the late Sir James Whitney referred to that country as the land of the blasted ipine and stunted poplar. But that day, gentlemen, has long since passed. I know of no other country in the world that has such opportunities for young men, and I desire to address any self to that question with the idea of pointing out the opportunities for the young manhood of this country to find a means of livelihood and of acquiring wealth in that new area.
The stage is set by nature for a development of mineral wealth in Canada unparal-lelel in world history, Whether for magnitude or rapidity. We live in a country more lavishly endowed with undeveloped riches than any other in the world. Where can you point to a natural treasure house, still substantially unexplored, to equal the Laurentian plateau, that area of over 2,000,000 square miles, all
underlain by a Preoambrian formation; found wherever its surface has been scratched "to be rich in all the minerals, common or rare that are used' in -the arts,"-I am quoting from the Department of Mines report, 1924- and proven capable, from the few odd spots which have been developed, of yielding gold alone to the value of two and a half million dollars a month? Truly there is no country in the world that can approach Canada in undeveloped natural resources. In water power, in minerals, in agriculture, in pulpwood, four of the greatest assets a country can possess, Canada leads the world.
I have not the time to discuss this budget from the point of view of the agriculturist. That point of view has been ably and vigorously championed by all parties in this house depending, somewhat of course, upon the political party to which the speaker belonged. I do say, however, that I think the agricultural members of this house and the farmers of this country are taking a very short sighted view when they do not assist in the development of our industrial plants and in the development of our mineral wealth, which would provide them with a home market in Canada for their products.
I have not the time to discuss the question of water powers. Everyone knows the tremendous progress that has been made along the line of developing the white coal that never burns up. There are other features that I have not the time to deal with, but I intend to devote a few minutes to a discussion of the mineral wealth of this northern country.
History shows that continued and increasing prosperity has never come to a country save through pre-eminence in sources of industrial power, in precious metals, or in agriculture. Equally true is it that great natural resources, once adequately and energetically developed, have never failed to bring great wealth to their possessors.
Europe has already developed most of her resources; some of her minerals were exhausted a thousand years ago; even her coal is nearing its limit. Our neighbour across the border is developing fast, and with what profit to her citizens! Canada, far richer than any other country in the beginning, is still virtually undeveloped. For Canada is young. Only forty-one years ago the last spike was driven in her first transcontinental railroad. Only thirty years ago the first gold was found in Klondyke. Only twenty years ago two of her great provinces west of the area I have been speaking of were marked out and given the status of provinces in this Dominion.
We realize to-day the significance of the statement that this north country now
The Budget-Mr. Cowan

possesses a purchasing power of nearly a hundred million dollars annually. The government railway which traverses this strip is, along the Quebec-Cochrane section, now paying 90 per cent of its operating costs Think of the possibilities when real development begins! A billion dollars has come out of the four leading mining camps in this area already. Mining is closing the gap. To-day there is activity almost all along that thin red line of communication. Prominent authorities expect that the next twenty-five years will see this thin line broadened out into a strip at least one hundred miles deep-well populated, and continually pouring out riches to our country and providing work for our smelters, our furnaces and our workshops.
Look at the map. Trace the line of present activity, from the Flin Flon mine in Manitoba, to the deposits near Bulldog lake, Red lake, Woman lake, Narrow lake, Savant lake, Armstrong, Beardmore, Jellicoe, Tashota, Kashabowie, where the old Huronian is reopening Macqua-through the great established camps of Cobalt, Kirkland lake, and Porcupine-on through Rouyn to lake St. John. The gap is closing. It is symptomatic of the part that our buried wealth has played, and will play to an increasing extent, in the economic consolidation of the country.
The digging of new wealth from the earth is a fundamental industry. The recovery of mineral wealth rounds out our ability to prosper. It goes on winter, spring, summer and fall, producing regular national income, paying regular wages, offering full time occupation supplying raw materials to our other industries, independent of season and of weather. There is little marketing effort needed to sell gold or silver; they possess an intrinsic value, whether sold or held. The world demands our minerals; and the demand is growing. It is Canada's opportunity and duty to meet that demand.
Mining is now the third largest of our primary industries; but it would have been difficult to persuade the average man thirty years ago that, apart from the placer (surface) mines in the Yukon and British Columbia, and a little copper in the eastern townships of Quebec, and some gold in Nova Scotia, Canada contained any worth while deposits of gold, silver, or other precious metals. Even as late as 1910 hon. members will recall with what distrust the Hollinger, the McIntyre and other mines in northern Ontario were regarded. Do we really appreciate these great mineral resources? Our ores will undoubtedly prove phenomenally rich and abundant. As a matter of fact we possess the greatest

single exposure in the Precambrian formation in the world.
As I have stated, there is abundant mineral wealth there. In 1923, when Mr. Drury was premier, the Ontario government appointed a commission to inquire into and report upon the development of the iron ore industry of the province. On the basis of that report the provincial government took measures to develop the industry. But before I go into that question may I say that in 1913 there were in Canada twenty-two blast furnaces, but in the autumn of 1927 these had dwindled to four. What has been the situation? It seemed for a time as if the iron ore industry was on a sound basis. That was due to the legislation passed by the government of the late Sir Wilfrid Laurier putting in force a bounty system, under which up to 1921 there was paid out in subsidies a total of eighteen million dollars. Apparently that aid enabled the industry to carry on successfully, but from 1921 the bounty ceased.
I was very glad to hear the remarks of the hon. member for Pictou (Mr. Cantley) delivered in the course of this debate, for he is an authority on the subject. While formerly we had to import only $143,000,000 of iron ore and its products, last year we brought in $240,000,000 worth, and we did not mine an ounce of iron ore. Now, hon. members will recognize that that is not a healthy situation. We spent $240,000,000 to import mineral although we have abundant deposits. As I said a moment ago, in 1913 we had twenty-two blast furnaces in operation, while to-day there are only four. Of these two are at Sydney, one at Hamilton and the other at Sault Ste. Marie. This decline, of course, reflects itself in the number of men employed, and whereas in 1913 there were 1,589 men at work in our blast furnaces, in 1925 the average number was down to 656, and it is still less this year.
When I spoke on the address in reply to the speech from the throne, I urged that the government should supplement the legislation enacted by the legislature of Ontario, and I now propose to give the house a quotation from the provincial statute. It is known as the Iron Ore Bounty Act, 1924, and its purpose is set out in section 3, as follows:
3. The treasurer of the province of Ontario may under the authority of such regulations as may be made from time to time by the lieutenant-governor in council, and out of moneys appropriated by the legislature for the purpose, pay a bounty to the miners or producers of iron ore which shall be raised or mined in the province of Ontario for a period of ten years from the date of the coming into force of this act, at the rate of one-half of one cent for every unit of metallic iron contained in every ton of such ore, in the manner following, that is to say:-

The Budget-Mr. Cowan
(a)	on low grade iron ore when the same has been concentrated, treated or beneficiated in Ontario by mechanical means and delivered at any iron blast furnace or other works for the production of pig iron or steel and for use in the same;
(b)	on iron ore in the natural or unbene-ficated condition when delivered at any blast furnace or other works for the production of pig iron or steel in the province of Ontario, and for use in the same.
It would seem to me, Mr. Speaker, that it is the duty of the government to take this question in hand. The idea was that the federal government would pay an amount equal to the bounty provided by the provincial statute which I have just quoted, and so make it worth while for the industry to be developed.


Mr. RALSTON:: Does the hon. gentleman happen to have the figures showing how much has been paid out under the Ontario act?


Donald James Cowan: I am sorry that I cannot give the figures.


Mr. SIMPSON:: Nothing has been paid out yet.


Donald James Cowan: Now, as to the imposition of an import duty. It is apparent that the $242,000,000 which in 1926 was added to the value of iron and steel products by the manufacturing activities in Canada was gained chiefly by the fabrication and finishing of imported materials, and that the contribution of materials of Canadian origin is becoming smaller by degrees and beautifully less to an extent that, if continued a few years longer, will render any Canadian contribution nonexistent. I think, too, it has been fairly well established that the importation of these raw or semi-finished materials has been aided by the lowering or complete omission of import duties in the most important instances of usage; but it is not true, as has been stated, that this favouring of importations from outside-so far as the products of blast furnaces and rolling mills is concerned-is required because of the inability of Canadian plants to furnish them. The record of idle blast furnaces, of unemployed men, and of declining production of primary products within Canada, are sufficient proof to the contrary.
I am not wedded to either scheme, whether an import duty should be placed on raw materials coming in from the United States, whether a bounty should be paid whereby our own iron mines would be developed, or whether a bounty should be paid to our blast furnaces; but I do suspect that the free importation of raw material has conduced to the destruction of this industry.


James Layton Ralston: Including coal?


Donald James Cowan: That brings up another phase of the subject. I understand this to be the fact, that the furnaces at Sydney, Hamilton and the Soo bring in American coal.


Mr. CANTLEY:: Not Sydney.


Donald James Cowan: Well, the other two bring in American coal, on which they have a drawback of 99 per cent.


James Layton Ralston: The hon. gentleman does not suggest that the drawback on coal used in the smelting and melting of metals causes injury so far as Ontario is concerned?


Donald James Cowan: I think my hon. friend is right, provided Canadian coal cannot be used; but if Canadian coal is adapted for that purpose, then without doubt it should be used, and the miners either in Alberta or Nova Scotia benefited to that extent.
Now it is impossible to develop these mines properly without the aid of capital. Some hon. members may believe that labour is the important feature. I am more interested in the immigration of capital than of labour at the present time. We see the curious spectacle of men of Canadian origin living in Canada using their money to develop industries in Mexico and South America and other foreign countries, when there are plenty of opportunities for the investment of their capital in Canadian industry. And in the getting in of capital that provides jobs for immigrants in pulp and paper and mining and power development, what we get is this: we get labour into industries which, unlike farming, are not seasonable industries. Mining has three eight-hour shifts a day and pulp and paper three, and for that reason there is a large quantity of work, but best of all, twelve months of the year round. Most of us know that if labour is going to keep the flour barrel full in the corner of the kitchen, it must have twelve months' employment. That is what the development of our natural resources does, and that is not saying anything detrimental to our wonderful farming industry. I believe if Canada, without losing one bushel of her wonderful western wheat crop, can continue to develop her mining industry, now more than half the annual value of the wheat crop; if she can continue to develop her pulp and paper industry, now more than half the annual value of the wheat crop, to the limit of the market to absorb that paper; if she can continue to develop her white coal that never goes on strike, then I say to you she is marching along the lines towards that destiny that these rich natural resources entitle her to among the nations of the world.

The Budget-Mr. Cowan
What would be the effect so far as the Canadian National Railways and the Canadian Pacific are concerned? As I stated a moment ago, the area to which I refer is that barren stretch extending along northern Ontario. In the United States, we find, forty per cent of the revenue derived by class A railway is obtained from the haulage of mineral products. That is a feature not to be overlooked in this country. Now, the Canadian National and the Canadian Pacific railways are our two largest single employers of labour. They also use a considerable quantity of coal. I believe that thirty per cent of the coal used in Canada is consumed by these two systems. I do not know this as a fact, but I sincerely trust that our Canadian railways are using Canadian coal wherever possible. As regards the Canadian National Railways, I must say that, so far as I have been able to observe in our community, the system is well managed. There has been development in that railway-something of which we are all glad: the esprit de corps among the employees and the desire to give good service to the public are commendable. There is evidently a desire on the part of the employees to have the system become a nation-making entity, binding east and west together. I do not know the president, but I understand that those in the service of the company, from the officers down, are endeavouring to give satisfactory service.
I do not intend to enlarge on the question of our immigration, but I am concerned about the conservation of our population. It is far better to provide jobs in Canada for those men whom we now have here rather than to seek, at great expenditure, to bring in people from the older lands and from continental Europe. It would be far better for us to develop our mining industries in this country with a view to providing employment for our own people, who would be paid in Canadian money and who would live in Canada.
Reverting to the question of capital, is it not capital going into this north country development which alone can widen out the thin red line along the two transcontinentals north of lake Superior, heretofore, a barrier between east and west? Is it not resources development in Alberta and British Columbia we require on the one side of the prairie and is it not resources development in northeastern Saskatchewan and Manitoba on the other side of the prairie? Is it not more smelters and oil fields? Is it not more zinc development which exists in immense deposits in the Precambrian north of Saskatchewan and gold and copper in Manitoba, all allied with cheap power development? Is it not these we require to create home markets

on the prairies and diversified industry, which embraces mining, farming and manufacturing? Is it not research benefiting both the farmer and the manufacturer? Is it not resources development that all Canadians can meet on common ground? Is it not, after all, the building of Canada basically level through these sound economic methods that will meet the complex needs of this, a complex age? It certainly is, sir, as surely as the needle points to the pole.
The policy of this or any other government in power should be to grapple with these difficulties and to consider the suggestions that have been put forward, and not a policy of evading the question and postponing consideration. We should have a general policy for the whole of Canada, a policy of activity to promote our national welfare, with zeal for imperial relations.
I want to refer to the act in regard to bounties in order to show that this is not a new system so far as Canada is concerned. In 1923 this parliament passed what is known as the Copper Bounties Act, which contains the following provision:
The governor in council may authorize the Payment, out of the consolidated revenue fund of the following bounties on copper bars or rods manufactured in Canada and sold for consumption therein, from copper produced in Canada from ore mined in Canada, during the periods and at the rates following, that is to Bay:
From the 12th day of May, 1923, to the 30th day of June 1924, both inclusive, one and one-half cents per pound.
I will not give the other dates; they vary from year to year. The last, however, are:
From the 1st day of July 1927 to the 30th day of June 1928, both inclusive, one-half of one cent per pound.
It is to be observed in this connection that the provisions of the act will expire on the first day of July of this year. I do not quote the act for the purpose of suggesting whether it be continued or not, but I do believe that it has conduced to the building up of one of the largest smelters in British Columbia. I quote it simply to show that the principle is not new and that where it has been adopted it has proved of great service in the development of our mineral wealth. I trust, therefore, that these suggestions, which mean so much to that northern country and incidentally to the Dominion at large, will be adopted by this government. As I say, the system is not new, but even if it were new surely this government, which has displayed such a total lack of leadership in other things, might be induced to take up the question and deal with it at the present session.

The Budget-Mr. Thompson
New times demand new measures and new men.
The world advances and in time outgrows the laws which in our father's day seemed just.
And doubtless after us some purer schemes will he shaped out by men more wise than we,
Made wiser by the steady growth of truth.


Mr. A. B. THOMPSON (East Sirncoe):: The budget as brought down by the Minister of Finance (Mr. Robb) is to a large extent but a repetition of former budgets brought down by him, in that whilst no very radical change is made in the tariff it still pursues the old policy of tariff tinkering, hitting one industry here, hitting another there, and creating in the manufacturing world a feeling of unrest, dissatisfaction and instability. One of the manufacturers in my riding has written me that as a result of the tariff changes brought down by the Minister of Finance there will be a decrease in the spinning of worsted yams in his plant of about 40 per cent, thereby throwing out of employment a certain number of men and women. In addition to that I believe when .one industry is affected it hurts other industries, thus reducing the market for Canadian products. I make this statement, sir, that in the past few years this government has done absolutely nothing for the development of the manufacturing industries of our country.
In common with the other speakers who have preceded me on this side of the house I desire to express my regret that no provision has been made for the abolition of the sales tax within the calendar year. This tax falls equally upon the rich and the poor and is in defiance of that well known principle of taxation, that the taxes should be paid by those who have the ability and the means to pay them.
Having in my riding of East Sirncoe the two important lake ports of Midland and Port MoNicoll, I should like to bring to the attention of this government the opportunity which exists for the building up of great industries in that portion of the country which will mean increased freights for our railways, larger cargoes for our freight boats, employment for a large number of men, larger payrolls throughout the country and in addition the return to this country of many thousands of Canadians who have been forced to a foreign country to earn that livelihood which has been denied them in Canada.
In the Georgian bay district, until a few years ago the lumbering industry was large and flourishing, giving employment to many thousands of men, paying in wages hundreds of thousands of dollars and giving in its industrial centres a splendid market to the farmer for his products. But, sir, I regret to say that that industry is rapidly vanishing, and that places which a few years ago were centres of activity are to-day scenes of enforced idleness. If this government can bring about a change which will result in renewed activity in these and other districts similarly affected I consider it their duty to do so.
The remedy is so simple that one wonders at the delay in applying it; perhaps its very simplicity is the reason for this neglect. To-da}'', Mr. Speaker, Canada is a large contributor to the building up of Buffalo and other United States lake ports, to the detriment of the lake ports of our own country. Large flour mills and storage warehouses are being built in Buffalo, involving the expenditure of millions of dollars, and this industry largely owes its existence to Canadian wheat. If a national Canadian policy were adopted, all this activity would be carried on in the lake ports of our own country. To-day Buffalo is producing more flour than any other city in the world, and one-half the wheat received at that port comes from Canada. The United States imposes a duty of 42 cents per bushel on Canadian wheat; if Buffalo had to pay 42 cents per bushel on the wheat it gets from Canada that wheat would soon be turned back into Canadian channels, but the United States are very clever; they take great care in looking after the interests of their own people. The United States made an agreement with Buffalo and other lake ports permitting them to mill all the Canadian wheat they desired in bond, without paying a cent of duty so long as the flour was exported. Canadian wheat going through Buffalo is not dutiable if passed on to. the seaboard for the purpose of export to fereign lands, but Buffalo and other United States cities may buy all the Canadian wheat they desire, manufacture it into flour and sell it abroad in competition with Canadian export flour. That is a splendid arrangement for the United States. The American duty prevents Canadian wheat from competing with American wheat but it does not prevent Canadian wheat, transformed into American flour, from competing with Canadian flour in the markets of the world.
What is the remedy? What means can we employ to keep Canadian wheat in our own country for transportation and for milling? The answer is simple; we should impose in export duty on that wheat, making it sufficiently high to protect our own industry. The United States duty against Canadian wheat is 42 cents a bushel, while our duty against American wheat is 12 cents a bushel.

The Budget-Mr. Thompson
Make the export duty 30 cents what will be the result? We shall have much more freight for our railways; larger cargoes for our vessels; an increased manufacture of flour in our mills; much more work for Canadians in our own country; increased payrolls and the retention in Canada for our farmers, live stock breeders and dairymen of the bran and shorts so much needed in these industries. It is estimated that during the last year Buffalo received 15,000)000 bushels of Canadian wheat for the purpose of milling in bond. Fifteen million bushels of wheat will produce 3,200,000 barrels of flour and 118,000 tons of offal, bran and shorts. The cost of converting wheat into flour, including overhead, is figured at 65 cents a barrel. Now 3,200,000 barrels at 65 cents per barrel amounts to $2,080,000, which represents the amount of wages paid to labour in the United States instead of in Canada. The loss to our railway companies in moving 15,000,000 bushels of wheat to Canadian mills and 3,200,000 barrels of flour to the seaboard is in excess of $1,500,000. Furthermore the sum lost through our transportation agencies not moving the 118,000 tons of bran and shorts referred to, would if distributed over Canada, represent a total of $675,000. If these products were shipped to the seaboard for export the earnings would represent some $550,000. The wheat milled in Buffalo is moved there from Port Arthur and Fort William, and no part of the product subsequently is carried by Canadian railways. A large part of our Canadian wheat instead of coming down to Midland and Port McNicoll for transhipment to our seaboard goes to Buffalo. That wheat is carried by United States boats and routed through American ports instead of Canadian ports, with the result that our railways lose a considerable amount of freight. Now, sir, if these advantages can be secured for Canada by the imposition of an export duty on our wheat, as I believe they can, surely we should not hesitate to adopt that policy. I trust, therefore, that the government will consider the advisability of imposing an export duty on wheat in view of the beneficial results which such a duty will bring to this country.
Before taking my seat I should like to say a word on behalf of the sailors who man the boats which carry grain from Fort William and Port Arthur to the southern lake ports. We all remember the loss of four fine freighters last fall with a sad loss of life in two cases. I have spoken with one of the officers of the wrecked ship Agawa, and as one listened to the tale of the hardships endured by the crews of these vessels

and the daring resourcefulness they displayed in saving themselves from drowning or perishing from the cold, one could not but admire the courage and heroism of those men and be proud of them as true Canadians. 1 would appeal to the Minister of Marine and Fisheries (Mr. Cardin) to see to it that every possible means is taken to protect the lives *of our sailors engaged in this hazardous occupation. In my opinion no work is so important as that. During the late fall the navigation of the great lakes is both difficult and dangerous-dangerous because of the storms that generally prevail in the late weeks of November and the early weeks of December, and difficult because the decks of vessels are covered with ice, the hatches are frozen down and the equipment largely disabled owing to ice conditions. On behalf of these men and their wives and children 7 would urge the minister to see that every possible precaution is taken by the establishment of life-saving stations, the installing of direction finders, and the adoption of other safeguards whereby the occupation of these men may be rendered less hazardous than it is at present.


Mr. J. A. FRASER (Cariboo):: Mr. Speaker, I find myself in agreement with the statement of the majority of the speakers who have preceded me that there is not much virtue in the budget which has been submitted by the Minister of Finance (Mr. Robb). And by the way, the small amount of commendation which the budget is drawing from the free tradeis on the opposite side of the house, is, in my opinion, rather remarkable. What has become of the lambs from Saskatchewan during the present debate? Have we heard from any of them' Is it possible that they see their pre-election promises unfulfilled in this budget? What is the reason for the silence which prevails in that quarter of the house? I should like to see some members from Saskatchewan answer the question
Now while I see no ray of hope in this budget for the improvement of labour conditions in Canada, there is one industry which affords cause for a good deal of satisfaction. I refer to the mining industry. This industry is receiving more consideration from year to year, and I am pleased to say that it shows some degree of progress. For instance we find that the production of the mining industry in 1926 amounted to $240,437,000, as against a total production in 1927 of $241,-
773,000,	or an increase in mineral production of li million dollars. The industry, I am told, employs in the neighbourhood of 83,600

people throughout the Dominion, and it is very satisfactory to see it in such a flourishing condition as the figures disclose. During the past year high records have been achieved in the production of several of the most important minerals which are found in Canada. That high production applies to gold, copper, lead, zinc, cement, gypsum, lime, natural gas and petroleum. In copper we have produced
140.000.	000 pounds, of which the province of British Columbia produced 92,000,000 pounds. The production of gold has increased from $36,250,000 to $37,750,000; and lead from
283.000.	000 pounds to 308,000,000 pounds; zinc from 150,000,000 pounds to 160,000,000 pounds. Now that is a very satisfactory state of affairs, but I give no credit to the present government for this heightened production or these improved conditions in the mining industry, for the reason that the industry is not under the direction of the federal government at all. The provincial government are responsible for all effort in regard to the production of minerals; they have to take in hand and lead this industry step by step, and the industry gets practically no assistance from the federal government. As a matter of fact this government spends $1.60 out of every $1,000 of total expenditure. How does a government expect to get credit for a condition of affairs of that kind? It would be a pretty good proposition for this government to consider a policy of bonusing an industry so important as the mining industry. If they would take into consideration a proposition to give to each province a bonus of one per cent of the total production of minerals in that particular province, they would be doing something for the mining industry. At the present time I see them doing nothing. Their efforts are not responsible for increasing the production in the mining industry. A government which is spending only $1.60 of its revenue out of every $1,000 that is spent is not doing very much to help it.
I want to take up another angle of the matter. So far I have been speaking of the primary industry of mining, but there is a very important industry which follows the primary industry and that is the secondary or manufacturing industry in all its branches. That covers a very wide field touching many different industries and people. It is an industry which should be giving a great deal more occupation to the Canadian people than it is doing at the present time and one Which, if the government would establish a proper policy, would no doubt quickly respond to intelligent treatment. Let me point out to the house for a few minutes the relation
The Budget-Mr. Fraser
that the mineral manufacturing industry has to the trade of this country. I find that our trade returns comprise nine main classes under which our total trade falls, and the mining industry occupies three of those classes: First, iron and its products; second, nonferrous metals and, third, non-metallic minerals. I want to give the house an outline of this industry as it relates to our trade covering the two years 1926 and 1927. The figures of our imports of iron and its products are as follows:
Year	Imports
1926		 $217,480,000
1927		 247,840,000
An increase of $30,360,000, or 14.4 per cent. Mark you, Mr. Speaker, that a very large proportion of the value of these imports is accounted for in articles of iron and steel which have been manufactured outside of this country and imported. These are the figures for the non-ferrous metals:
Year	Imports
1926	 $50,105,000
1927	 59,074,000
Or an increase	of	17.8	per	cent. These	are
the figures for the non-metallic minerals:
Year	Imports
1926		 $151,952,000
1927		 158,414,000
Or an increase of 5 per cent. The totals for these three classes are as follows:
Year	Imports
1926		 $418,537,000
1927		 465,329,000
Or an increase	of	$46,791,000, or 11.1	per
cent in the three classes. Let us turn now to the exports under the same headings. These are accounted for mainly by our raw materials which we are digging up out of our mines and sending out of the country. The figures are as follows:
Year Exports
1926	$76,587,000
1927	70,146,000
1926	85,182,000
1927	85,021,000
A very small decrease of $161,000, or 2 per
cent.
Iron and its products. Non-ferrous metals..
Year Exports
Non-metallic minerals. ..	1926	$26,313,602
1927	27,171,528
Or an increase of $857,926, or 3.1 per cent, the only class of our exports showing an increase. Note the tendency: Imports all on the increase; exports, except one item, on the decrease. We are importing manufactured articles at an increasing rate and exporting our raw materials at a decreasing rate. Our total mineral imports increased $46,791,000 while our exports decreased $5,421,000, leaving
The Budget-Mr. Fraser

a difference to be made up in other trades or by money sent out of this country to the amount of $52,213,000. Our total mineral imports for 1927 amounted to $465,329,000 and our exports to $183,339,000 leaving a balance of about $282,989,000 to be made up by the exportation of other articles or the sending of cash out of the country. Thus there is in the mining and manufacturing industry of Canada a difference by way of an adverse trade balance of about $283,000,000 which has to be made up by the exportation of products of some other kind, or by money sent out of the country to pay the bills for goods which we have imported, goods which might have been fabricated out of all these minerals by our people instead of the raw materials being sent out of the country to be manufactured and then re-imported for the use of our people. That state of affairs is not satisfactory to this country. Our mineral trade is not giving Canada the stimulus it should be giving to it. Two years ago when I pointed out this situation on the floor of this house for the first time, the difference between exports and imports was about $150,000,000 of an adverse trade, and now, two short years afterwards, that adverse trade has grown to $283,000,000. That is an alarming increase of an adverse balance of trade which should be looked after by this government. While I am alarmed at this state of affairs, it seems to me I am not the only person in Canada who has noticed this trend of events, because I find that the Minister of Trade and Commerce (Mr. Malcolm) must have been hearing whisperings in the mulberry leaves or someone had been pointing out to him this trend of events, because he apparently armed himself with an array of statistics and proceeded to the centre of industrial activity in this country, the city of Toronto where he endeavoured to explain to the board of trade, to his own satisfaction and to theirs, that, there was nothing very dangerous in this trend of increasing imports and decreasing exports.
I find the speech reported in the Toronto Saturday Night of December 31st last, and I would recommend hon. members to read it, for it is both readable and very instructive. After a considerable discussion of questions upon which I am not going to touch he proceeds to point out that the increase in our imports during the last year amounted to $87,000,000, and then he goes on to explain away that nobody should be alarmed about this condition of affairs.
In the first place he points out that $30,000,000 of this amount is accounted for under the heading of iron and its products. I have

already touched upon that, and my figure was $30,360,000. But taking his $30,000,000, that leaves $57,000,000 still to be accounted for. I am not going to analyze very closely that remaining $57,000,000. I am taking his statement that it is made up very largely of luxury imports-imported by a prosperous people, remember-and raw materials. In fact, he speaks of our imports of raw materials increasing over the year before by $25,500,000. The Minister of Finance presented the same idea to this country when he delivered his budget speech in 1927, for, it may be remembered that, in explanation of the large increase in importations, he said in his cryptic way, "A busy Canada requires increasing quantities of raw products 'for its factories." The Minister of Trade and Commerce agrees with the Minister of Finance, and he indicates to the people of Canada that it is these raw materials that are required by our factories that account for so large a proportion of our increased imports.
The Minister of Trade and Commerce then goes on to point out that $9,000,000 is made up of increasing imports of beverages, and $11,000,000 by fruits and vegetables, making $20,000,000 under those two heads. I have not had time to go into that very carefully, but I would advise hon. members wno interested to examine it closely before accepting that as the final word to be said on the matter.
As I say, the Minister of Trade and Commerce claimed that $25,500,000 was accounted for by increasing imports of raw materials. That statement is scarcely in accordance with the facts, because I find that in support of it the minister says in the first place, that the imports of cane sugar account for an increase of $7,000,000. Now, to start with, there is no such item in the trade returns as cane sugar, but I find from the trade returns that there is an increase in the total sugar importation of $7,000,000. But a lot of manufactured articles enter into that $7,000,000 of imports. The raw sugar imported, which of course, is the only raw material in this case, increased by only $4,000,000. So he falls down there $3,000,000 in his analysis of the increase in imports, because it is not $7,000,000 of raw sugar, but only $4,000,000 of an increase.
He then goes on to say that there has been an increase in the imports of undressed fur of $2,500,000. I am not going to question that except to say that I have had considerable experience in the raw fur trade myself. The exports of raw fur have increased from $18,000,000 to $23,000,000, but I maintain that that increase is accounted for by the value of

The Budget-Mr. Fraser
the fur, not by an increase in quantity. I know perfectly well from my connection with that trade that there was a substantial increase in the value of all furs during that time, so the minister's explanation of that $2,500,000 increase in regard to furs does not amount to very much.
Coming back to the question of sugar, I have admitted that $4,000,000 more of raw eugar was imported into this country than during the previous year, while the minister claims an increase of $7,000,000. Notwithstanding the fact that there is an increase in value of $4,000,000, what do we find when we look at the quantities of sugar that have been imported? In 1926 we imported 11,275,929 hundred-weight of sugar; in 1927, 9,836,667 hundredweight, or a decrease of 1,439,322 hundredweight. I submit with all deference that a decrease in the quantity of the raw material imported is of much more importance to this country than an increase
in the value of the raw material imported, and confirmatory of that, when you turn to the exports of raw sugar, what do you find? They absolutely confirm the opinion that would be drawn from these figures, that the sugar industry was not as properous as it was the preceding year. We find that the exports of sugar have been reduced from 2,878,732 hundredweight in 1926 to 2,074,729 hundredweight, or a decrease of 804,003 hundredweight, or 30 per cent.
Another industry which uses a large amount of raw material is the cotton industry. We imported in 1926, 137,500,000 pounds, and in 1927, 133,500,000 pounds, or a decrease of 4,000,000 pounds in one year. On the other hand, when you look at our imports of the manufactured article, you find exactly the reverse condition obtaining; that is, the importations of cotton yams have been increasing in quantity, as follows;
Imports	Cottons	1926	1927	IncreaseCotton yarns	.. . Lbs.	3,212,000	3,695,000	485,000Cotton fabrics (bleached)	9,682,000	10,800,000	1,180,000Cotton fabrics (dyed)	39,140,000	42,672,000	3,352,000Wearing apparel	$2,314,000	$2,372,000	Increase $58,000Fabrics printed	9,244,000	9,213,000	Decrease 31,000(or J of 1%
On the other hand, our exports of the same material decreased from $871,000 to $735,000, or a decrease of $136,000.
The total amount of flax, hemp and jute imported in 1926 was $15,932,000; in 1927, $14,694,000, or a decrease of $1,238,000. On the other hand, jute cloth and canvas, which are the manufactured articles from those raw materials, were imported to the extent of
89,813,000	yards in 1926 and 97,660,000 yards in 1927, or an increase over the importations in 1926 of 7,847,000 yards. But the exports of our flax fibre have dropped from 8,470 hundredweights in 1926 to 3,670 hundredweights, in 1927, or a decrease of 4,800 hundredweights- practically cut in two.
Then let me direct attention to our woollen industry-an industry which a number of hon. members have already dealt with in this debate. I find that our imports of raw woo1 in 1927 had decreased by 1,102,000 pounds, while our imports of woollen yarns had increased 351,000 pounds. Our importations of carpets and rugs increased 672,000 square yards; tweeds 36,000 square yards; worsteds and suitings, 321,500 square yards. In this
schedule we have one item the imports of which have decreased by 57,000 square yards- I refer to dress goods to be dyed. Our exports of raw wool have risen from 4,791,000 pounds in 1926 to 11,178,000 pounds in 1927, or an increase of 6,387,000 pounds. It will be noticed that we have a decrease in our imports and an increase in our exports of raw wool. Does that look as if our woollen industry was expanding in the same ratio as our production of wool? I dhould think not.
Now, I have pointed out that our raw sugar imports for manufacture have decreased by
1.439,000	hundredweights, raw cotton by 4,000,000 pounds, flax, hemp and jute by $1,300,000, and raw wool by 1,200,000 pounds. I ask hon. members: Can they not see these home industries expanding? Can they not see the smoke stacks multiplying throughout the land? Can they not see the development of power to keep pace with our expanding industry? I submit that our industries show in every single instance a decrease in importations of raw material and an increase in importations of the finished article. That is the trend throughout all the schedules I have dealt with.

The Budget-Mr. Fraser
It is the trend of business throughout the whole Dominion as far as I have been able to discover.
Having taken the minister's bubble of increasing imports of raw materials and burst it, I want now to deal with his attempted explanation of the increase of $30,000,000 in the importation of iron and its products. In this connection let me read from the article in Saturday Night to which I have just referred, in so far as it pertains to his explanation and his attempt to convince our people how little they should be alarmed about this importation. Here it is:
The remaining issue is that of the importation of industrial equipment, an issue intimately bound up with the increase of 30 million dollars in the imports of iron and its products. In a community like Canada it is of the utmost importance that iron and its products, the chief articles of industrial equipment, should be available as freely and as quickly as possible. In view of our great variety of manufacturing industries and the manifold types of machinery which they use as their industrial equipment, it is impossible to expect that all this varied machinery should be produced within the country in the early stages of its development.
Conceivably many industries might be compelled to use equipment made in Canada, but the desirability of enabling the producers of this country to secure their machinery at the lowest possible cost has been recognized by many governments. In 1918 the then government placed low-priced farm tractors on the free list.
That is, if you steal a sheep I can do the same.
The present government since its formation has lowered the duty on agricultural implements, many other implements of production and motor cars. This importation of machinery and industrial equipment on easy terms is of enormous advantage to the bulk of our producers and has been shown to be so by the general prosperity which has followed, the adoption of this policy, as is reflected in the financial standing of the industries affected in each case.
Will those hon. members who are particularly interested in our iron and steel industry please listen to this:
Are we now to delay or to retard the accelerating industrial expansion of the Dominion by discouraging the importation of industrial equipment, when there is scarcely a large manufacturer in Canada who is not using equipment of such a specialized character that it would be impossible to produce it for our limited demand except at prohibitive cost? Far from it; the great increase in our imports of iron and its products will be the source of increased production in the near future, and to check it would be disastrous.
And again I ask hon. members who are interested in the iron and steel industry to note the minister's words:
There is enough demand in Canada at present for articles of iron and steel to keep

our existing domestic plants busy so that our additional demands must need be imported from other countries.
Now, let me take that up seriatim.
In a community like Canada it is of the utmost importance that iron and its products, the chief articles of industrial equipment, should be available as freely and as quickly as possible.
Well, why not encourage our people to provide them as freely and quickly as possible? When we required these things in the pressing time of war whom did we turn to? Did we bring these commodities in, or did we turn our own people loose to manufacture them? I submit that a policy which is good in war time is easily adaptable to peace time. Then the hon. minister proceeds:
In view of the great variety of manufacturing industries and the manifold types of machinery which they use as their industrial equipment, it is impossible to expect that all this varied machinery should be produced within the country in the early stages of its development.
I want to ask the hon. minister if we are really in the early stages of our development. I thought that we have had the national policy for fifty years, and that it had given a pretty good account of itself during our expansive period in the eighties, again from 1900 to 1910, and again during the war years. Did we not find it pretty handy to have this iron and steel industry in the years between 1913 and 1918? Did we not find it good business to turn to our own people to provide these products for us. Why not turn to them now? The hon. minister the other day admitted on the floor of this house that after all our own people are the best on earth to do business with. This being so, I should like to know why he does not give them an opportunity to earn their living in their native country instead of importing this machinery because, as he suggests, "We are in the early stages of our development." And then he continues:
In 1918 the then government placed low-priced farm tractors on the free list.
Of course, it was not this government, it was the other government. Well, that is quite true, I believe a certain class of farm tractors was put on the free list by that government in 1918, and very likely for it they got the support of our free trade friends. But what has been the result? It is strange, Mr. Speaker, how the chickens come home to roost. Only two or three days ago I noticed in the press an article telling us that a trainload of fifty-three cars of farm tractors was being hauled to the prairie provinces. From where? From the works of the International Harvester Company in Chicago, if you please. Now, farm

The Budget-Mr. Fraser
tractors are required for the development of this country, and that being so, why not encourage our own people to build these tractors in Canada? Then he goes on:
The present government since its formation has lowered the duty on agricultural implements.
Yes, this government has reduced the duty on farm machinery-with what result? Our imports of farm implements in 1926 were
SI7,325,000	and in 1927 $25,782,000, or an increase of $8,457,000. That is to say, the increase in our imports in that period amounted to 48 per cent. What about exports, on the other hand? In 1926 our exports of farm implements totalled $17,318,700, whereas in 1927 they amounted to $16,701,500, or a decrease of $617,200-that is to say, 3i per cent. Here again we have an increase in imports of manufactured articles and a decrease in business when we attempt to sell these things abroad. Where is our agricultural implement business going to? Then take motor cars. It would make one weep, Mr. Speaker, to look into our motor car business and examine the returns of our imports and exports issued by this same Minister of Trade and Commerce. Let us take vehicles, for example. In 1926 we imported vehicles to the extent of $54,038.000-surely enough. That ought to be enough of imports of vehicles, embracing almost entirely motor cars. But apparently the government did not think these imports were large enough, and so we find in 1927 that they had increased to $65,431,000, or an increase of $11,392,000, or 21 per cent. And what do we find in the matter of exports so far as vehicles are concerned? In 1926 our exports of vehicles amounted to $39,-
430,000	whereas in 1927 they had declined to $33,758,000, a decrease of $5,672,000, or 16 per cent. In imports we find an increase of 21 per cent and in exports a decrease of 16 per cent. Surely that is providing work for the people of this country.
The writer of the article from which I have been quoting goes on to say:
There is enough demand in Canada at present for articles of iron and steel to keep our existing domestic plants busy so that our additional demands must need be imported from other countries.
Well, that is the final blow to the industry. There we have a straight-cut declaration of policy on the part of the government, a positive intimation that they have absolutely no consideration for the iron and steel industry of this country. We must get our supplies from outside because we are not capable of producing them here. That is an unequivocal indication of the intention of the
government to destroy the iron and steel industry in all its branches, lock, stock and barrel. Hon. gentlemen from the maritimes and from Ontario who are asking for more protection for iron and steel so that the industry may be built up in order to provide work for the people of this country may just as well kiss the business good-bye and forget all about it until we get a new government, one upon whom we can count.
The Minister of Agriculture (Mr. Motherwell) is taking a hand in this affair also.


Mr. MOTHERWELL:: Just looking on.


John Anderson Fraser: He gets excited about imports and exports; once in a while he is much exercised in this regard. An important delegation from the National Dairy Council of Saskatchewan a short time ago presented to him certain facts in regard to the cream and butter industry, and now I am giving him information concerning other industries. All these industries are going in the same direction; they are all going to the bow-wows on account of this government's policy. The Minister of Agriculture, good natured soul that he is, came to Ottawa after they had made this declaration, and when he realized that the dairymen were alarmed'at the state of the industry, he poured oil upon the troubled waters by giving these people exactly the same assurance as the Minister of Trade and Commerce has been giving to the people of Toronto: " Don't be afraid. Our imports are increasing and our exports decreasing, it is true, but all is well with the industry." Yes, all will be well with the industry when the government succeeds in having the whole business transferred across the line to the other side. In the last two years the Minister of Agriculture has altered the basis of this industry from an export of 24,000,000 pounds to an import this year of 10,000,000 pounds.
And the same thing is true in regard to any other business you like to mention. Let us take boots and shoes, for example. In 1926 we imported 802,744 pairs as compared with 805,532 pairs in 1927, or an increase of 2,788; while our exports have dropped from 110,534 pairs in 1926 to 87,634 pairs in 1927, or a decrease of 22,900 pairs.
In the matter of fish, our imports in 1926 totalled $2,376,800 and in 1927, $2,995,500, or an increase of $618,700; and our exports of fish declined from $35,984,000 in 1926 to $33,109,000 in 1927, or a decrease of $2,875,000. Apparently there is no end to the trend of events which all point to the total disappearance of industry from this country. Is it any
The Budget-Mr. Fraser

wonder that there is an exodus of people from Canada and that we are looking for immigrants to take the place of the capable citizens we are losing?
Let me give you the figures relating to wood products. In 1926 our imports were 19,335.947 and in 1927 $10,571,878, or an increase of $1,235,931: that is to say, 13 per cent. And so far as exports of wood products are concerned, there has been a decline from $54,174,989 in 1926 to $4S,S17,326 in 1927, a decrease of $5,357,663, or 10 per cent.
Then we have the fruit industry; exactly the same state of affairs exists in this business. Our imports of fruits in 1926 totalled $29,550,000 and in 1927, $32,820,000, an increase of $3,270,000, or 11 per cent; while our exports in 1926 amounted to $8,512,000 as compared with $5,539,000 .in, 1927, a decrease of $2,973,000, or 34 per cent.
The same thing is true of butter, which I mentioned a few minutes ago. And as regards cheese, our imports have increased 48 per cent. Those who are interested in the dairy industry will note that fact-an increase of 48 per cent in our imports of cheese, notwithstanding the fact that this country used to be the leading cheese producer in the world. It will take just one year more of this government's administration to wipe out the industry, and there will be no cheese factories left. But while there has been an increase of 4S per cent in our imports of cheese, our exports of the same commodity have declined by 15.9 per cent. The same thing is true, again, of eggs: our imports have increased by 7 per cent while there has been a decrease in exports of 148 per cent. Is it any wonder at all that the people of this country are getting tired of the present government? How long will it take the government to put Canadians out of business entirely and force them to cross the line, whether they want to go or not?
I have almost finished, Mr. Speaker. I believe I have two minutes left and in that time I will try to discuss a more pleasing subject, one which the government probably would rather listen to. I want to call their attention to conditions in the Peace River country. There is no denying the fact that in the Peace River district there is presented a great opportunity to bring in a population which would very rapidly enhance the prosperity of that part of the Dominion, because we have there a very fertile and productive territory.


Hewitt Bostock: The hon. member's time is up.
On motion of Mr. Glen the debate was adjourned.
On motion of Mr. Lapointe the house adjourned at 10.30 p.m.
Monday, March 5, 1928
The house miet at three o'clock.



DEPARTMENT OF NATIONAL REVENUE


Ernest Lapointe: That 400 copies in English and 200 copies in French of the report of Messrs. Clarkson, Gordon & Dilworth respecting the reorganization of the Department of National Revenue be printed forthwith, and that standing order 64 be suspended in relation thereto.


[Stage Direction]
Motion agreed to.

[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Railways):	A week or two ago the hon.
member for Peace River (Mr. Kennedy), asked whether I could table a copy of the engineers' report upon the Peace River pass as a possible western outlet from the Peace River country. I have obtained a copy of the report and table it herewith.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)

Mr. BELL (St. John):: 1.	Is there a warehouse at Cribbins Point, Antigonish county, Nova Scotia, owned by the Public Works Department?
2.	If so, what was the cost of said building?
3.	How much was spent for repairs on said building during the years 1925, 1926, 1927?
4.	For what purpose was this building intended?
5.	Is the department now receiving a rental for said building, and, if so, how much?
6.	What is the name of party now using said building, and what rental is paid by him, if any?
7.	Have the fishermen of this district access to and part use of the building?
8.	If so, on what conditions?


Mr. ELLIOTT:: 1.	No.
2 to 8. Answered by No. 1.

Questions


BOARD OP GRAIN COMMISSIONERS
George Gibson Coote: What was the revenue and expenditure of the board of grain commissioners in connection with the inspection and weighing of grain during each of the last three crop years?


Mr. MALCOLM:: Revenue: 1925, $1,304,145.66; 1926, $1,745,189.38; 1927, $1,631,181.45.
Expenditure: 1925, $1,069,379.56; 1926, $1,275,068.56; 1927, SI,637,594.46.


MR. D. B. HANNA
Mr. HEAPS:: 1.	Does Mr. D. B. Hanna draw any pension through the Department of Railways and Canals?
2.	If so, what is the amount?


Mr. DUNNING:: 1.	No.
2.	Answered by No. 1.


BREAKWATER AT RUSTICO
Mr. MACDONALD (Kings):: X. Has a contract been let for repairs to the breakwater at Rustico, Prince Edward Island ?
2.	What is the nature of the work undertaken, and the amount of said contract?
3.	What are the names of all tenderers in connection with this work, and the amount of each respective tender?


Mr. ELLIOTT:: 1.	Yes.
2.	(a) The rebuilding of the outer portion of the breakwater for a length of 280 feet immediately inward of the outer block, and a width of 21 feet, and also the reconstruction of the headblock. (b) Approximately $21,584 (unit prices).
3.	Andrew Martin, Bloomfield, P.E.I., $21,584 (unit prices); Farley and Grant, Ottawa, Ont. $22,643 (unit prices); Everett McLeod & Duncan MacKenzie, French River, P.E.I., $22,767.50 (unit prices); Henry James Phillips, Charlottetown, P.E.I., $28,446.50 (unit prices).


CANADIAN NATIONAL RAILWAYS-CASH ADVANCES
Mr. STEWART (Leeds):: 1. What is the amount of cash advanced (exclusive of guarantees) to the Canadian National Railways by the Dominion of Canada in each of the fiscal years 1925-26, 1926-27, and 1927-28 (to date) ?
2.	What is the amount of securities issued by the Canadian National Railways and guaranteed by the Dominion of Canada in each of said fiscal years?
3.	What is the amount of unguaranteed .securities issued by the Canadian National Railways in each of said fiscal years?


Mr. DUNNING:: 
MAILS BETWEEN TRACADIE AND CHATHAM
Mr. HANSON:: 1.	When will the present contract for the carriage of His Majesty's mails between Tracadie and Chatham, New Brunswick, terminate?
2.	Who is the present contractor, and what is his remuneration per annum?
3.	Has the present contract been renewed without asking for new tenders?
4.	If so, on whose authority and for what reason?
5.	Is it a fact that a responsible resident of Tracadie, New Brunswick, is willing to enter into a firm contract for the performance of this mail service at a figure $400 per annum less than paid to the present contractor?
6.	Will the Post Office Department give assurances that this contract will be put up to public tender before being renewed?
7.	If not, why?


Mr. YENIOT:: 1.	30 June, 1932.
2.	Euchariste Arseneau, $4,800.
3.	Yes.
4.	The Postmaster General authorized a renewal on existing terms and conditions. This contractor has been reported as efficient, the service adequate and the cost reasonable.
5.	The Post Office Department has no information to this effect.
6 and 7. See answer to No. 4.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. EVANS:: 1.	How many immigrants came into Canada during the year ending December 31, 1927?
2.	Of what nationality were these comprised?
3.	To what occupation did they go?
4.	What religious denominations did they claim ?
5.	How many people went from Canada to the United States other than tourists?
6.	How many returned to Canada other than tourists?

Privilege-Mr. Campbell

7.	How many of the immigrants of 1926 are settled on farms: (a) for themselves; (b) as hired men and women?
8.	What was the total cost of the Immigration department during the year ending 1927?


MAIL ROUTES IN COLCHESTER
Mr. MacNUTT:: 1.	How many mail carrier routes are now maintained in the county of Colchester?
2.	What points do these cover?
3.	What is the mileage of each?
4.	What is the name of contractor?
5.	Are these daily, bi-weekly, or tri-weekly for each route?
6.	What is the remuneration paid for each route ?
7.	What is the average cost per mile where one-horse conveyance is used?
8.	What is the average cost per mile where two-horse or motor conveyance is used?


FAMILIES FROM GREAT BRITAIN
Mr. ROSS (Kingston):: 1.	How many families have been admitted to Canada under the policy to bring 3,000 families from Great Britain to Canada?
2.	When was this policy inaugurated?
3.	How many persons from the Hebrides Islands were settled in Alberta under government policy or approval?
4.	How many of those persons are now in residence in Alberta?
5.	Where have the other persons removed to and for what reason?



UNOPPOSED MOTION FOR PAPERS


Mr. CAMPBELL:: For a copy of all correspondence, letters, and other documents in connection with the dismissal of L. L. Bassham from the position of postmaster at Annette, Saskatchewan, and similar papers in connection with the appointment of his successor.



ESTIMATES OF DEPARTMENT OF AGRICULTURE

[Stage Direction]
On the orders of the day:
Mr. ROBERT GARDINER (Acadia):: When the agricultural estimates were before the committee of the whole a few days ago items 44 and 46 were allowed to stand over. May I ask the Minister of Agriculture (Mr. Motherwell) whether it would be possible for him to have printed for the information of members, the various items that go to make up these particular two?


William Richard Motherwell: I will look into the request and see what it involves.



AIRPLANE FACILITIES AT VANCOUVER

Mr. L. J. LADNER (South Vancouver):: I wish to ask the government whether I am warranted in expressing felicitations to them on their decision to establish at or near Vancouver, facilities, similar to those at Montreal, for the landing of airplanes, seaplanes and dirigibles.


James Layton Ralston: Is the hon. gentleman asking whether plans are being made to establish a landing place?


Leon Johnson Ladner: The question is whether
plans are being considered or whether any decision has been arrived at to establish at or near Vancouver the facilities I have mentioned.


James Layton Ralston: No.


Ernest Lapointe: He doesn't deserve felicitations.



PRIVILEGE-MR. CAMPBELL

[Stage Direction]
On the orders of the day:
Milton Neil Campbell: I
find in Hansard of March 2, the following reference to myself made by the hon. member for West Elgin (Mr. Hepburn):
In the session of 1926 his voice was raised in righteous indignation in protesting against the Moses Asiz case where a stay of prison sentence was granted allowing a man to start a jail sentence in the fall instead of in the spring. .	.	.	. At the time the hon. member
for Mackenzie was censuring the government for its actions in this regard he too had successfully pleaded with the department for a stay of jail sentence for a bootlegger regularly convicted in his own riding.
The hon. member is possessed of a very vivid imagination and in this instance he used it to the limit. I have never at any time, either in this house or out of it, either publicly or privately, criticized the then Minister of Customs, the Hon. Mr. Boivin, or any other member of the governmenet in connection with the Moses Asiz case. Indeed, sir, if one will refer to my remarks at page 5015 of Hansard of June 25, 1926, it will be found that I made myself very clear with respect to the government. I pointed out that if there were no more charges against the government than those against the then Minister of Customs, the late Hon. Mr. Boivin, I should be prepared to vote confidence in the administration. I made no reference either then or at any other time to the Moses Asiz case. Further, may I point out that the farmer, on whose behalf I pleaded with the Clemency branch of the Department

The Budget-Mr. Glen
of Justice for time to get his crop in and pay the fine, was not even charged with the crime of bootlegging; his was a very minor offence. The hon. member goes further and makes some reference to a ease now before the courts of the land. I will not repeat the impropriety of which he was guilty, and discuss the merits of that case in this house at the present time further than to say this, that when the matter has been publicly discussed and all the facts are known it will be found that these facts will reflect serious discredit on the party to which the hon. member belongs.



THE BUDGET


[Stage Direction]
The house resumed from Friday, March 2, consideration of the motion of Hon. J. A. Robb, (Minister of Finance), that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, the proposed amendment thereto of Mr. Cahan, and the amendment to the amendment of Mr. Fansher (East Lambton).
Mr. J. A. GLEN (Marquette):: I am quite sure that the Minister of Finance (Mr. Robb) will expect no bouquets from me to-day for the proposals contained in his budget speech, but that need not prevent me from extending to him my sincere sympathy in the discharge of the high duties of his office. He is a somewhat paradoxical gentleman, and as he sits and listens to criticisms of his budget speech he must come to the conclusion that he is of all members of the house the despoiler and the destroyer of our economic system. Yet it is a peculiar and remarkable thing that of all the members of this house there is none more trusted and more fully respected; he is certainly one of the greatest assets of this government to-day.
I propose to address myself more particularly to the two amendments which have been moved, the first by the hon. member for St. Lawrence-St. George (Mr. Cahan) which is as follows:
This house regrets that the measures proposed by the government do not tend to provide increased employment in Canada, nor to induce the return of Canadians to their native land, nor to prevent the continued emigration of our people to the United States; and that they make no provisions for the preservation of our domestic markets for Canadian farm and dairy products, nor for the effective development of the natural resources of the country, nor for the abolition of the sales tax by the 1st of January, 1929-
It will be noted that the hon. member makes no reference to the reduction in the 56103-63i
rate of income tax. He stated at the beginning of his speech that his was-
.	.	.	. the task of replying to that address
and of setting forth as best I can the Views and policy of the Conservative party in this house and in the country on the several matters enunciated by the Minister of Finance ....
In the course of his speech the hon. member made some slight and casual references to the income tax, in one of which he admitted that the reductions in the income and sales taxes were reductions of special war taxes, and from the lack of comment on these reductions in the amendment I assume, as this house is entitled to assume, that the Conservative party are in favour of the reductions proposed. I intend to deal with that proposal later on, in its proper place. By this amendment the hon. member deplores the fact that the proposed measures do not tend to promote increased employment in Canada, to induce the return of Canadians to this country or to prevent the emigration of our people and I assume from the phraseology employed that this is intended to cover three major proposals, the latter two of which are related and should really form one.
I have carefully read the speech of the hon. gentleman in order to ascertain the remedies proposed by his party to overcome these defects, and so far as I can ascertain he proposes to meet these difficulties by the application of certain principles which he enunciated in the course of his speech, and which will be found in Hansard of Monday, February 20. I have not time to read these nor do I think it necessary to deal with them seriatim; they are couched in the usual form of convention resolutions dealing with matters of policy. They are broad enough to cover the Dominon of Canada; they are wide enough to embrace every body, political, religious and social, and they are deep enough to justify their application by any party in whatever way is found most convenient. Unfortunately for the hon. gentleman, however, they were framed in a setting which portrayed a picture entirely different from that conveyed by their verbiage; I think there was no necessity for so many words, because I am satisfied that one word alone would have conveyed the whole meaning, and that word is "protection." If that is not the meaning of the resolutions, and if that is not the method by which the unemployment and the immigration problems are to be settled, then the hon. gentleman has missed the import of all the speeches made from his side of the house.
The Budget-Mr. Glen

With that principle I do not agree, nor do those who sit around me. Consider paragraph 4 of these principles, which is as follows:
The stabilization in Canada of the costs of living and the costs of implements of production on such comparatively low bases as will enable our people, in producing and selling our surplus of national products abroad, to compete advantageously with the products of foreign countries in our common markets abroad.
That is exactly what we in the west have been striving for during many years, and we have found that to be contrary to the policies adopted by the party to which the hon. .gentleman belongs. The west has advocated free trade on those articles which comprise the essentials of living and the means of production, at the same time not denying to the east the same advantages. So far as I know, no one denies the east the advantage of free trade; no one wishes to deprive the manufacturers of their right to the raw material which enters into their finished product.
Let me quote a few examples to show how the manufacturers have made use of this principle. You will find that they are entitled to a drawback of 99 per cent on rolled iron, rolled steel and pig iron when used in the manufacture of mowing machines, reapers, harvesters, binders and attachments for binders. They are also entitled to a drawback of 99 per cent on steel used in the manufacture of cutlery, files, augers, auger bits, bit braces, hammers, axes, hatchets, scythes, reaping hooks, hoes, hay or straw knives, agricultural forks, hand rakes, skates, stove trimmings, bicycle chains and windmills. Manufacturers who import malleable iron castings or steel shafting for use exclusively in the manufacture of mowing machines, harvesters, self binding or without binders, binding attachments, reapers and complete parts thereof, cultivators, harrows, horse rakes, seed drills, manure spreaders, weeders and complete parts thereof, ploughs and complete parts thereof, wind stackers and threshing machine separators including baggers, weighers and self feeders therefor and complete parts thereof, spraying machines, fruit or vegetable grinding machines, incubators, brooders, jimmy hooks, shears, hay grain cutters, fanning mills, milking machines and so on are entitled to a drawback of SO per cent. All materials entering into the cost of the manufacture of binder twine or twine for harvest binders, when imported for such use exclusively by manufacturers manufacturing such twine only are entitled to a drawback of 99 per cent.
These finished articles include many of the implements of production. Under our tariff 
laws the manufacturer is entitled to a drawback on the materials used by him in the manufacture of these implements; in many cases he pays a duty of only one per cent. This is a fundamental free trade policy; the manufacturer requires it and no one gainsays his right to it, but there is no known method by which the farmer can secure such a drawback, and consequently he can only work for relief by way of lower duties. Surely there is something inconsistent and illogical in the system which permits the manufacturer to accept a free trade policy in the initial processes of his business but to deny that policy when he imposes a duty on his finished article, which duty must be paid by the farmer who has no drawback and who cannot add to the price of his product. The consumer says that if it is necessary this should be done, but I am sure the hon. member for St. Lawrenee-St. George will agree that it should not be done on the ex-parte statement of the manufacturers alone. We say to them: Prove your claim before the tribunal which has been constituted, namely, the tariff advisory board, and when it is proved then, and then only, shall the remedy be applied.
The latter part of the amendment moved by the hon. member for St. Lawrence-St. George (Mr. Cahan) regrets that there are no provisions-
-for the preservation of our domestic markets for Canadian farm and dairy products nor for the effective development of the natural resources of the country, nor for the abolition of the sales tax by the 1st of January, 1929.
The hon. member does not deal at any length with any of these propositions, and I shall follow his example. I will merely say that the arguments advanced by the hon. gentleman on the question of markets, if he will pardon me for saying so were not very convincing. I shall deal with the question of the sales tax later. In my view, therefore, there is nothing that I can hope for by supporting the amendment of the hon. member. It seems to me that its form and its enunciation are more academic than real. It may be good doctrine from the point of view of the hon. member, and he may believe it, but it is not sufficient to convince me, and I shall therefore oppose the amendment. I come now to the sub-amendment of the hon. member for East Lambton (Mr. Fansher), which reads as follows:
This house regrets that the government proposes further reductions in the income tax, thus making a serious departure from the principle of direct taxation; that the proposed revision of the customs tariff is inadequate to bring effective relief to the consuming public; and that the sales tax on the necessaries of life has not been eliminated.

The Budget-Mr. Glen
Now the subamendment is in a different class from the amendment in that it is categorical in its terms and concrete in its application. I will deal in the first instance with the second part of it as to the revision of the customs tariff. I am not convinced that the sweeping charge made has been proved either by the mover in his fair and able address, or by subsequent speakers fair or unfair. These schedules are still unintelligible to the ordinary member, and the extraordinary member who does understand them has not revealed himself. There is need of investigation before definite conclusions can be arrived at, but I think that some general conclusions can be stated on part at least of the schedules. Prior to the introduction of the budget I, like others, was struck by this fact, namely, the absolute lack of press or other propaganda for increased or higher duties; even Besco was unwontedly silent. There may have been other causes, but I feel that at least one of the causes was the demolition of the applications of the manufacturers before the tariff board. I have always said that this question of tariff reform could not and cannot be understood until the question has been properly presented and properly published. We are now in the position where evidence can be presented, and only at this session can it now be published. I am going to suggest to the Minister of Finance that the evidence of the tariff board should be published in the form of a daily Hansard for the information of members and the public generally. After all the tariff board is a public body maintained at public expense, and its work should certainly be available to the public. Its principal function I understand is to get facts. I can only get these facts when applications are made for a hearing. In view of this it seems to me that it is altogether too early to decry the work of the board. It is only beginning to function, and if the government wishes the board to function as it should, and if it wishes to remove the suspicion which has been voiced in this house that the board is only a smoke screen for the government, it can easily dispel that suspicion by the publication of the records of the board.
Now, sir, I have, like most hon. members, considered as carefully as I could1 the question of the proposed changes in the tariff schedules submitted by the Minister of Finance. I realize that a number of these proposals are for the purpose of reclassification and enumeration of different items, tending to give a more scientific and more understandable tariff schedule. To that idea no one
will take exception, and I do not think it would be unwise to suggest a revision of the whole of the customs schedule. I realize in some degree what that means but as, in the last analysis, the government must depend upon supplies for the carrying on of public business, and as the largest part of our revenue is derived from customs, the undertaking would only be what might be called in ordinary mercantile establishments good business. Now apart from this classification I think it can be shown that there are a number of items, affecting cottons and linens principally, on which reductions are made in the existing tariff; and I think there are one or two instances which show increases. But I will not presume definitely to pronounce upon these items in this forty minute speech; when the budget goes to committee I shall take whatever opportunity presents itself to ascertain precisely the truth of the statement I have just made. The Minister of Finance has stated on his authority as a member of the government that there have been downward revisions. That statement from one in his position must be accepted as correct, failing evidence to the contrary, and so far as I have heard or read no one as yet has endeavoured to prove the contrary.
I am further strengthened in my viewpoint by this fact, that if no downward revision has been made, then one would imagine that the industries affected would have no complaint, and hon. members opposite who support protection and the sheltered industries would have acquiesced. I took the trouble to search Hansard and learn what has been said by hon. members, and I find that the member for South Waterloo (Mr. Edwards) said on the 23rd of February, as reported at page 731 of Hansard, referring to the Minister of National Revenue (Mr. Euler):
He is an able native son of our county. But with the influence which I presume he has with this government it seems to me that he might have been a little more successful in protecting some of the industries which are established in the southern part of the county and which have been very badly hit by this budget.	I refer more particularly to the
textile industries, those of woven cloths and worsteds.
And the hon. member for Fort William (Mr. Manion), an apostle of high protection, said on the 21st February, as reported at page 656 of Hansard:
While the tariff changes may seem minor when one looks at them first, already from reports coming in to members of this house who have in their constituencies mills which are affected by these tariff changes, it looks as if serious injury was once again going to be done by this government to the industrial life of this country.
The Budget-Mr. Glen

Further on he says:
As time goes on, the government and the people of this country will find that the reductions in the present tariff, though minor in appearance, will do more injury to the industrial life of our country-
That is the opinion of this hon. member, and what have the industries affected said or done? I have not asked for nor obtained any names, but I am informed that numerous representations have been made by the woollen industry against the changes in the customs tariff rates. Some of these have been made in person, others by letter or telegram, and the burden of the complaint is that the revision will mean that they will have to close up their plants. Various textile manufacturers have objected to the changes on the ground that they require more and more protection. Paper manufacturers have interviewed the Minister of Finance and have protested against the eighty per cent drawback on paper used in the production of magazines. Cordage manufacturers have sent delegations protesting against the reductions. Chemical industries have interviewed the Minister of Finance and protests have also been received from them.
In view of these gloomy anticipations which, in my judgment, are only a repetition of the honk of the automobile, it seems to me that the sub-amendment is inadequate on this point, and its real meaning is that the budget has not gone far enough in its downward revision. But I must assume in the light of present knowledge, that the manufacturers who ought to know their own business are convinced that the proposed alterations have a downward tendency and consequently that revision will have an effect on the price to the consumer. As I said at the beginning, I am not here to hand out any bouquets to the Minister of Finance and I do not think he would expect them from me. These revisions are not what I hoped for; they are considerably less than I expected, and I would certainly have been much more satisfied with greater cuts. I am not unmindful of the fact that the present Minister of Finance, in his budgets since 1922 and in his dealings with tariff, cannot surely be charged with serving the cause of protection, but that whatever revisions have been made have been consistently downward. Only on Saturday morning I happened to receive in the mail the February issue of the Journal of Commerce which somewhat goes to support what I have said. This Journal of Commerce is a review of industry, commerce and finance, published monthly from the Garden City Press at Gardenvale, Quebec.
{Mr. Glen.]


An hon. MEMBER:: A Tory paper.


James Allison Glen: which is in form direct taxation, rather than the indirect form of taxation by means of customs duties.
In looking at the subamendment, which asks for support on the ground that the sales tax on the necessaries of life has not been eliminated, I notice that it does not go so far as the original amendment, which asks for its complete abolition by January 1, 1929. I thought it well to look over the list of articles which are to-day exempt from the sales tax, and which I find in the Canadian Almanac for 1928, at page 119. I there found that the following articles embracing many of the necessities of life and implements of production are exempt:
Bread, butter, cheese, coffee beans, corn meal, eggs, fish, flour, foods cereal, fruit canned, lard, meats and poultry, milk, oatmeal-
I am glad oatmeal is exempt. Also agricultural implements are exempt as follows:
Binder twine, binding attachments and parts, drain tiles for agricultural purposes; engines, gasoline and portable; fanning mills, feed for calf, cattle, hogs and poultry, fence posts, fertilizer, forks pronged, fuel of all kinds, furs, gas, harness and parts, hay, hoes, logs, machinery of different kinds, milking machines, mowing machines and parts, paper, seed drills and parts. Shoes exempt 50 per cent, sleighs, spades, wagons, wool.
In all, there are over 300 exemptions.
Now in view of the loss of revenue which would accrue by the abolition of the tax as indicated in the original amendment, and the fact. that so many of the necessities of life are already exempt from its operation, I think the Finance minister has proposed the soundest method in proposing to eliminate this tax by degrees.
I have endeavoured, Mr. Speaker, to state as precisely as I can in the short time at my disposal the provisions in the budget which can be supported. I have tried to show that support of the subamendment would require me to acquiesce in the provision that the proposed revision of the customs tariff is inadequate to bring effective relief to the consuming public ", I cannot support that conclusion, although I agree with the sentiments expressed, and do most heartily wish there had been more reductions than are indicated. I would point out that the amendment does not deny that there are reductions, but that they do not go far enough. I realize that the reduction of the income tax rate may betoken a departure from a principle which I think this House has not agreed to, and which, so far as I know, has not been a subject of discussion in the country. It is altogether probable-I would imagine it imperative-that some pronouncement in that regard will be made by the government.
S-Mr. Glen.]
In conclusion, I would like to refer for a moment to what was said by the hon. member for Peace River (Mr. Kennedy). I was astounded when I heard the hon. member suggest the other day that there was a possibility of a deal 'being consummated by the Alberta members with the protectionists. I wonder if he was speaking for himself, or was really endeavouring to voice the opinions of the west. M|ay I say that the members sitting on this side representing western constituencies are unalterably opposed to any such deal, and further, that I believe the hon. member is wholly and absolutely mistaken, in supposing that the people of the west would countenance such a proposal. The greatest condemnation of the speech of the hon. member was the tremendous applause it received from the Conservative benches. They know, as most people in the west know, that such a deal would be in the nature of that known as robbing Peter to pay Paul, Paul representing the proteictionsts. I will say this, however, that I believe such a scheme would obtain the hearty support of the hon. members for Mackenzie (Mr. Campbell), Camrose (Mr. Lucas), and Kindersley (Mr. Carmichael). I am sure they would put no obstacles in the way of the consummation of an alliance so unholy. It would in my judgment be the death knell of all the hopes of the west. I cannot help but think it might well be expressed in the words of the old limerick: There was a young lady of Riga Went out for a ride on a tiger,
They came back from the ride,
With the lady inside,
And a smile on the face of the tiger!


William Irvine: Look at the smile now!


Mr. GARLAND (Bow River):: That is
what happened to the Liberal-Progressives.


James Allison Glen: May I say to the hon.
members who have lectured us so frequently in this debate, that we seek neither their commendation nor fear their recriminations. We believe that the interests of the west are as safe in our hands as theirs. We do not propose to make a political gesture on this budget for home consumption, even at the risk of being misunderstood. Nothing would be easier from the point of view of safe tactics than to vote for the subamendment; but it would be only a gesture.


Mr. W. A. BOYS (North Simcoe):: Mr. Speaker, I do not think I should commence my speech without expressing to my friends opposite my appreciation of the measure of applause which they have given me on this occasion-I suppose it is because I seldom trespass upon the good nature of the house.

The Budget-Mr. Boys
As I have said on previous occasions, during my years as chief whip of the Conservative party, I thought silence was golden, and I imagine my hon. friend the government whip (Mr. Casgrain) will probably agree with me in that.
My main purpose in rising to take part in the debate is to discuss the merits and demerits of free trade and protection in connection with certain Canadian industries. But before doing so I wish to say a word or two upon three or four matters which have been engaging the attention of the house. First, I shall touch on the question of the right of the Minister of Immigration (Mr. Forke) to issue permits under the provisions of the Immigration Act.
If I required any excuse, Mr. Speaker, for touching upon this subject, it would be found in the invitation given by the minister himself to the lawyer members to express their views. If the rules of the house permitted, I should be glad to read what was said during the dialogue which took place between the hon. member for Frontenac-Addington (Mr. Edwards) and the Minister of Immigration and the Minister of Health (Mr. King) last Tuesday, February 28. But I think my recollection is accurate when I say that the Minister of Immigration stated distinctly that he had not authority under the act to issue a permit in the case under discussion. If I am wrong in that I shall be glad to give him an opportunity of correcting me, for I can assure him that I have not the slightest desire to mis-state anything he said in the discussion. In this view he was supported by the Minister of Health, and evidently it was thought that what had then been said was insufficient, for two days afterwards the Minister of Health himself made a speech dealing with the matter. To summarize the position, both ministers are of opinion that under the act the Minister of Immigration has no right to issue a permit.
In the discussion last Tuesday nothing was said about section 18, but in his speech the Minister of Health says that is the controlling section, and because of it there is no right to issue a permit. I am sure, Mr. Speaker, we will all agree upon this, that if ever there was a case that merited the exercise of favourable discretion on the part of the Minister of Immigration-if he has that discretion-it certainly was the case in question. I do not think for one moment that the minister would want to separate a baby of fourteen months old from its mother, nor, on the other hand, the mother and baby from the father and the other four little
members of the family. I am sure the whole house is agreed upon that proposition. It therefore brings us to a direct discussion as to the power of the minister under the act. To properly consider the question it will be necessary for me to quote one or two sections. Under section 3 we find this provision :
No immigrant, passenger or other person, unless he is a Canadian citizen, or has Canadian domicile, shall be permitted to enter or land in Canada, or in case of having landed in or entered Canada, shall be permitted to remain therein, who belongs to any of the following classes, hereinafter called "prohibited classes":

Then follow the various classes, and the main class is found in subsection (a):
Idiots. imbeciles, feeble-minded persons, epileptics, insane persons, and persons who have been insane at any time previously;
Then follows a subsection with respect to diseased persons, and so on, which I need not trouble the house with. Now let me quote section 4:
The minister may issue a written permit authorizing any person to enter Canada, or having entered or landed in Canada to remain therein without being subject to the provisions of this act. Such permit shall be in the form A of the schedule to this act, and shall be expressed to be force for a specified period only, but it may at any time be extended or cancelled by the minister in writing; and such extension or cancellation shall be in the form B of the schedule to this act.
Then follows a subsection No. 2 providing for returns of such permits to parliament.
Now then, the Minister of Health, to whom up to date has fallen the lot of giving the house the benefit of the law on the subject, says that the controlling section is section 18. Any person who reads the act will see that this section has not the slightest bearing upon a case of this kind because it deal's with cases where an appeal is to be taken from the decision of the board of inquiry. There was no appeal in this case. The child never landed, but was compelled to return to Scotland with its mother. So section 18 has not the slightest bearing upon the case. I am ready to admit that had the parents of the child appealed from the decision of the board of inquiry to the minister, under that section the child could not have been admitted. But, sir, there was no appeal taken, and the section has no application whatsoever. Therefore we are driven to a consideration of section 3 and section 4. Let us again consider section 4:
The minister may issue a written permit authorizing any person to enter Canada, or having entered or landed in Canada to remain therein-
The Budget-Mr. Boys


Robert Forke: Are you in favour of admitting feeble-minded girls?


William Alves Boys: I say again to the minister that we have nothing to do with feeble-minded girls as distinguished from feeble-minded boys.


Robert Forke: Or feebte-minded boys?


William Alves Boys: I am not here to express my views upon the subject, I am trying to discuss, pursuant to the minister's invitation, the provisions of the act with regard to the matter.
Now, Mr. Speaker, let me deal with the motion, the amendment, and the subamendment before the house. So far as the subamendment is concerned, there is only one feature that I would not be glad to support; that is the middle feature. I had better read it all:

_ The government proposes further reductions in the income tax, thus making a serious departure from the principle of direct taxation; that the proposed revision of the customs tariff is inadequate to bring effective relief to the consuming public; and that the sales tax on the necessaries of life has not been eliminated.
So far as I am concerned I benefit to some extent by a reduction in the income tax. But this benefit is not anything like as important as many people think. On an income of 810,000 it means $23; on an income of $5,000, half that sum, and above that income in proportion. I would much prefer to do without that benefit, and, speaking purely from a selfish standpoint, I am inclined to think I would benefit more by the abolition of the sales tax. But whether I would or would not, I am absolutely in favour of the total abolition of the sales tax at the earliest possible date, and I am in accord with the suggestion made on behalf of this policy in the amendment. And when the time comes and the revenues of the country permit a reduction in income tax, by all means let us have it; but let the first tax to be abolished be the sales tax, thereby benefiting not the few, who can afford to pay, but all the people of the land. I could not favour the middle portion of the subamendment because it would be contrary to the protective principle with which I agree. I could not support the subamendment for the further reason that it entirely abolishes the amendment of my own party and that in itself would be a sufficient justification for my voting against it.
A word as to the Home Bank. In the riding I represent to-day there is not, I think, a person who will benefit by anything further that may be done in connection with the Home Bank depositors, but in the riding I formerly represented, prior to 1925, that is, South Simcoe, there were over 1,300 depositors with total deposits of nearly $400,000. It was undoubtedly the intention to give the 35 per cent to all depositors of $500 and less, and all of over $500 who were what is known as needy or deserving cases; but unfortunately the amount estimated to be necessary for the purpose was inadequate and I understand that it now requires something like 8400,000 more-


Mr. ROBB:: My hon. friend will allow me
to correct him. The government provided sufficient but in the other house it was reduced.


William Alves Boys: I am not making political
capital out of it; I quite agree that it was done in the Senate. What I desire to do is to convey to the minister and to the house my own views regarding the matter, from an equitable standpoint, and because I cer-

The Budget-Mr. Boys
tainly was interested in the 1,300 odd depositors in South Simcoe alone who had on deposit the amount I have mentioned, I feel it my duty to bring the matter up. It would be manifestly inequitable if they were not all treated alike. I think, therefore, that whatever sum may be necessary to give them all 35 per cent that item should be provided for in the estimates, and it will certainly have my heartiest support.
I want now to refer to the Canadian National Railways. During the last two or three years a persistent effort has been made to suggest to the people of the country that the Conservative party is not, at any rate 100 per cent, behind the Canadian National system. I may say that in my own election in 1926 this question was brought up,, and the Minister of Finance will recall the circumstance, for he honoured us with a visit in the town of Collingwood. An effort was made locally during that campaign to prejudice the electors of my own town against me in this regard. The town is a divisional point where there are six or seven hundred railway employees. I am glad to say that those employees, fully knowing my attitude towards the national railway, paid no attention to the efforts which were put forth both in speeches and in print. Anyone who knows anything at all about the matter is perfectly aware that there would be no Canadian National railway system in Canada to-day had it not been for the Conservative party, whose legislation it was that took over the Canadian Northern and the Grand Trunk, consolidating both and thereby creating the Canadian National Railways. After the election of 1921, when our friends opposite took power, I well remember at first how this matter was viewed. There was not one of those hon. gentlemen who would stand up and declare himself absolutely in favour of the Canadian National Railways; the attitude was, "We will give it a fair trial." But the proposition of the Conservative party was so sound that hon. gentlemen opposite have not only given it a fair trial but now want to claim the parentage of the child.


Mr. HOCKEN:: The government claims to be the stepfather.


William Alves Boys: I must hurry now. I am
afraid I shall not have time to cover the whole ground.


Mr. CASGRAIN:: Take your time.


William Alves Boys: I will come now to the question of free trade and the tariff. I hold no brief whatever for the manufacturer; I am not interested in any manner whatsoever in any manufacturing industry in Canada. But so far as I am concerned I do favour adequate
protection. I repudiate the suggestion that the party to -which I belong are high protectionists, although I believe there are cases where a higher protection would result in lower prices, and in that respect I should think the principle would accord with the views of any hon. member. I feel I have a peculiar right to discuss the question of protection inasmuch as I was elected twice upon that issue and it fell to my lot to be opposed, both in 1925 and 1926 by no less a person, than the Hon. E. C. Drury, the leader of the Progressive party in the province of Ontario, exPrime Minister of Ontario, past master of the Ontario Grange, and, until a few days ago, president of the Progressive party itself. He is perhaps one of the ablest, and certainly one of the most outstanding free traders in the Dominion. The Hon. Mr. Drury challenged me to a joint debate and as a matter of fact we had two debates, one in the town of Barrie and one in Collingwood, the subject under discussion being the tariff.	We each had, all
told, an hour, and perhaps it is not amiss for me to say that I doubt whether in any country town there have ever been two more largely attended meetings. In my own town the armory was jammed; there were over 4,000 people present. And in the skating rink in the town of Collingwood the attendance was also exceptional, many being unable to gain admittance. I may add that a good many persons came from beyond the confines of the county of Simcoe,- expecting no doubt a scrap of some sort. We discussed the tariff, and I will take this opportunity of showing to the house some articles that played a very important part, particularly in the election of 1926. I made it my business to have a friend of mine attend the meetings of my opponent to find out just what he was saying to the people, and I ascertained that he was going about with a small general stock of merchandise comprising ladies' dresses, ladies' silk stockings and hardware of varied descriptions, including two hammers. These hammers are well known in the county of Simcoe and fairly well known in the province of Ontario, but I do not suppose they are quite so well known in other portions of the Dominion or in the House of Commons. I have these hammers here and I thought the house might be interested to have a look at them. They were utilized for the purpose of exterminating me politically in those two elections. They have a history and it is necessary that I should give that history if the house is fully to appreciate what took place. I noticed that during the last week of the campaign of 1925 they were not displayed. I really did not know at that time why their use was discontinued, but for some reason or other they were abandoned. Now
The Budget-Mr. Boys

Mr. Drury's argument was this:	"Here is a
hammer made in the United States, price $1.65; and here is another hammer made in St. Catharines, Canada, price 11.75". As I say, this is Mr. Drury's argument, which I am illustrating in my own humble way. He was much more dramatic than I can be. He said, "If it were not for the tariff you would be able to buy this American hammer for $1.35 instead of $1.65". Of course, he received warm applause; the argument created great satisfaction among the farming community then present. I heard no more about the hammers during the last week of the campaign but after the election I heard something about them. I found that they were available. Mr. Drury had not bought them; he had only borrowed them, and having had the full use of them for a month he returned them. Having ascertained that they had been restored to the place whence they had come, I inquired whether I could purchase them and was informed that, like any other article in the store, they were for sale. I promptly said, they are mine, and I bought and paid for them. That hon. gentleman went around for three or four weeks telling the people that this hammer was made in the United States, and if it were not for our tariff it could be bought for $1.35, while the other hammer was made in Canada. On both these hammers, however, stamped in the plainest possible lettering, we find the words, "Made in Canada." They are here for anyone to see, and they were there at the time to be seen. Mr. Drury's explanation, when finally cornered, was that he thought one was made in. the United States. To be fair to him, he was apparently deceived by that little tag, but how in the name of goodness he could carry these hammers around for two or three weeks, producing them in the well lighted halls of North Simcoe, and fail to observe those words "Made in Canada " is beyond me. I do not suggest for one moment that he did it deliberately; I cannot think Mr. Drury would do that, but it is in keeping with many other fallacious arguments advanced by Mr. Drury and those who think with him on the question of free trade.
In deciding to what particular industries I should direct my attention, I wanted to get some which affected the rural population as much as, if not more than, the urban population, and I wanted to get two on the free list and two on the protected list. I think the arguments I am about to advance can be applied to a great many other industries, but the ones I have selected, rightly or wrongly, are those two standard industries

with which all free traders deal and with which Mr. Drury dealt in the debates we had together. I refer to binder twine and cream separators. The other two articles, both highly protected with a duty of 30 per cent, are rubber and leather.
The stock argument of the free trader is that the tariff is a tax and invariably the tariff raises prices; that is the argument we have to meet. In the election of 1925, before I knew the story of these hammers, I answered Mr. Drury in this way:	If the
tariff is a tax and always raises prices, and since the United States of America is one of the most highly protected nations in the world, why do you want free entry of their goods into Canada? If your argument is right the prices would be high and you would only secure the free entry of high-priced goods. That is what I cannot understand about many free traders; they want to get United States products intol this country, while no one will dispute the fact that the United States is one of the most highly protected countries in the world. Therefore, if the tariff is a tax surely the articles produced in the United States under this high protection must be high priced, and how are the people of Canada to gain by their free admission?
Now let us analyze the binder twine business. Binder twine was put on the free list in 1898, and we will see what were the imports of binder twine from that time on:
Year 1895		Pounds
1900		
1905		
1910		
1915		
1920				
1921		
1922		
1923		
1924		
1925		
1926		
Then let us consider the production from 1920 to 1926 I could give this at greater detail, but I do not believe anything is to be gained by so doing, because there is not much variation in the figures. The total production during those years was as follows:
Tear	Pounds
1920		 40,548,845
1921		 37,206,502
1922		 31,891,713
1923		 43,145,520
1924		 57,420.864
1925		 48,224,782
1926		 58,431,083
If you take away from the total production the amount of the exports you will find that in every year with the exception of two,

The Budget-Mr. Boys
more binder twine was imported into Canada than the amount of Canadian binder twine consumed. Perhaps I should also show the effect upon prices:
Year	Cents per pound
1913		 9
1914		 9
1915		 8
1916		 10
1917		 17
1918		 22
1919		 22
1920		 20
1921		 17
1922		 12
1923		 11
1924		 12
1925		 14
1926		 14
The house will see that free trade did not reduce the price of binder twine, but that as a matter of fact the price was raised and is now much higher.
What was the effect upon the industry? Is there anything that should succeed in Canada better than the binder twine industry? I can hardly imagine what it might be, unless it were the furniture industry. I am absolutely consistent in that also; I say a duty of 30 per cent on furniture is aill right. That is my view and I hope to demonstrate it before I get through. I have not the slightest reference to my friend the minister, who was very fair and whose figures are very favourable to my argument. What happened to the binder twine industry? Prior to binder twine being placed on the free list a great many companies in Canada were manufacturing that article; I have not counted them, but I am going to show the house what happened. Remember that binder twine was placed on the free list in 1898:
Ayton Cordage Company, Ayton, Ontario, liquidated 1903.
Canada Flax and Fibre Company, Lachine, Quebec, liquidated 1911.
Canadian Cordage and Manufacturing Company, Peterborough, Ontario, liquidated 1910.
Chatham Binder Twine Company, Chatham, Ontario, liquidated 1904.
Brandon Cordage Company, Brandon, Manitoba, liquidated 1904.
Ferguson Brothers, Kingston, Ontario, liquidated 1902.
Frontenac Cordage, Kingston, Ontario, liquidated 1905.
McKenzie & Company, Valleyfield, Quebec, liquidated 1908.
Perth Flax and Cordage Company, Stratford, Ontario, liquidated 1906.
Walkerton Binder Twine Company, Walker-ton. Ontario, liquidated 1903.
Welford Brothers, London, Ontario, liquidated 1902.
James Brown and Son, Quebec, Quebec, dismantled.
A. Main and Son, Hamilton, Ontario, dismantled.
Thomas Connor and Sons, St. John, N.B., dismantled.
A. W. Morris and Brothers, Port Hope, Ontario, dismantled.
James Loehrie, Toronto, Ontario, closed.
Richelieu Cordage Company, St. John, Quebec, closed.
Bannerman Brothers, Lachute, Quebec, burned.
Farmers' Binder Twine Company, Brantford, Ontario, burned.
That left three up until two years ago, namely the Consumers' Cordage Company of Montreal and Dartmouth; the Plymouth Cordage Company of Welland and the Brantford Cordage Company of Brantford, and the latest information is that in 1926 the Dartmouth plant of the Consumers' Cordage Company ceased to manufacture binder twine, while in July, 1927, the Montreal plant of that company also ceased the manufacture of this article. That leaves only two. I understand there has been something of a controversy during the last few months in the Ottawa Citizen on this very question, and in this connection I would like to quote in part from a letter which appears in the Ottawa Citizen under date of February 7, 1928, over the signature of the Brantford Cordage Company. It was suggested that this business was not as well managed as it might be, and this letter is the answer of the company:
The business is still under the active management of Mr. C. L. Messecar, under whose direction the business was built up from small beginnings until it has become the largest binder twine plant in the British Empire .	.	.	. the present difficult situation is
entirely the result of new competition that has arisen from Holland and Germany.
The closing paragraph of the letter is as follows:
We have spoken to many representatives of western farmers' organizations and wherever the matter has been explained to them, they have agreed with us that some action should be taken and we trust this explanation will make our position clear. We can assure you there is nothing in the way of good management or handling of the business that can overcome the present handicap, for every other mill operating in Canada is suffering in the same way and one mill has recently closed and been dismantled, and the others, like ourselves, are operating with the hope that something will be done; but if nothing is done, it is not reasonable to think that any mill can continue indefinitely to operate at a loss.
Yours truly,
The Brantford Cordage Co., Limited. Jan. 31, 1928.
And this is one of the two remaining industries, and the largest one in the British Empire. That letter practically says " If something is not done we will go out of business too ". And yet we have people who
The Budget-Mr. Boys

suggest that there should be free trade in the case of an industry such as this which is absolutely suited to the country and which could make money under proper tariff conditions.


Mr. MILLAR:: Are not these two companies producing more now than was being produced in Canada in 1898?


William Alves Boys: I am not in a position to give my hon. friend that information. I do not carry all these figures in my head. In any event I do not think it is necessary. The story I have told should satisfy even my hon. friend who desires to see this particular industry flourish in Canada.
Now let me go on and deal with cream separators, which is another industry operating under free trade. The following were the imports in the seven years from 1920 to 1927 inclusive:
1920			 $749,022
1921			 956,785
1922			 314,202
1923			 229,656
1924			 509,973
1925			 408,787
1926			 724.794
1927			 997,548
May I tell the house, Mr. Speaker, that every figure I am giving is taken either from figures supplied by the Trade and Commerce department, or from sworn evidence before the tariff advisory board, which evidence is available to the public. The Minister of Trade and Commerce has cited in connection with rubber industry more favourable figures than I intend to give. Now let me give figures of the production of cream separators for the same period:
1920		 $1,683,634
1921		 934,923
1922		 727,655
1923		 854,067
1924		 724,909
1925		 816,468
1926		 1,096,215
If you add to that the bowls which are imported as well you will find that the latest returns would indicate about a fifty-fifty division of the trade. Is there anyone who would suggest that if these binder twine and cream separator companies had enjoyed the benefit of the Canadian market that they would not have been able to operate to capacity, with corresponding low overhead charges, and that prices would have been much lower? But the main thing, perhaps, is that we would have had thousands of workmen living in Canada, receiving their wages in Canada and spending their money in Canada.

Let me pass on to other industries. The information I have already given tends to bear out, I think, what I have suggested, that protection leads in the majority of eases, I will not say always, to lower prices.
The rubber industry in this country enjoys the benefit of a general tariff of 35 per cent. The Minister of Trade and Commerce told the house the other night that not in connection with a single tire of any size whatever made in Canada did the price reach more than 8 per cent higher than the1 corresponding United States price.


Mr. BANCROFT:: What is the tariff in
the United States?


William Alves Boys: 
Hewitt Bostock: Unfortunately the hon. gentleman's time is up.


William Alves Boys: I am very sorry but I must bow to this rule which I favoured but at the moment regret.


James Layton Ralston: Mr. Speaker, having regard to the experience of the two hon. members who have preceded me, I do not propose to take up the time of the house or my own time with any introduction, but I shall go directly to the matters which I wish to discuss. Before proceeding with my remarks, let me suggest to the house that, in view of the policy which has been enunciated by the hon. member for North Simcoe (Mr. Boys) who has just sat down, it is rather surprising that I can find nowhere in the "swivel-chair" tariff resolution which was passed in Winnipeg any suggestion that either binder twine or cream separators should be made dutiable. I find further that my hon. friends opposite, in passing their resolution, have endeavoured at least to give the impression that:
It is desirable in the national interest that in such revisions of the tariff the cost of living and the cost of the implements used in the production of whatever nature should be given special and attentive study.
Whatever that may mean, it at least would not mean that binder twine, which has been on the free list since 1900, should now have a duty imposed on it, and that cream separators, which I think were put on the free list during the regime of my hon. friends opposite, should have a duty imposed upon them. My hon. friends, if they thought protection was a good thing, have had ample opportunity from 1911 to 1921 to impose a duty on binder twine and cream separators. I rather suspect my good friend who leads the opposition and who comes from West Calgary (Mr. Bennett) would not regard that as a sound political move, regardless of the fact that his lieutenant behind him suggests that it may be sound economics.
I wish to discuss just one or two things which have been said in the course of the debate with regard to the position of Canada. Like other hon. members I have felt that there have been a good many sombre reflections in connection with conditions existing in this country and I should like to refer to the matter of the cost of living. Nothing is more important to those who propose to take up their residence in any country than to ascertain what conditions are respecting this thing knowrn as the cost of living. When the hon. member for St. Lawrence-St. George (Mr. Cahan), who I am sorry is not in his place today, suggested that the cost of living is higher in Canada than in the United States, and
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when, the hon. member for Inverness (Mr. Macdougall) gave figures to indicate that the cost of living had increased since 1921, I hastened to look up the record in order to find out whether either of them was right. I am glad to be in a position to correct the statements made by both of these hon. gentlemen on this very important subject. The hon. member for St. Lawrence-St. George said that the government should do everything possible-
-to reduce the average cost of living in this country which is "so high in comparison with the cost of living in the same state of society across the border."
I have secured the figures of a food budget of articles in common everyday use, and I find that in 1925 that budget came to $8.70 in Canada and $10.46 in the United States. I have had that revised in accordance with present day prices and I find that the figures for 1927 amount to $9.63 for Canada and $11.44 for the United States; in other words, a difference in favour of Canada of nearly 20 per cent. The hon. member for Inverness stated in his speech:
"In 1922 the cost of living for a family budget, including foods, rent, clothing, and so forth, was $20.67 per week. In December of last year it was $21.37, a slight increase. In other words, the government have not made happier fireside climes for the poor people of Canada."
My good friend who gave the figure of $20.67 for 1922 had selected the month of July, 1922, and had attempted to compare that with the month of December, 1927. Perhaps my hon. friend missed the column, but I think it would have been better if he had looked at the figures for January, 1922, which show the cost of living for a week as $21.52, and the figure for December, 1927, is $21.37, so that there is a slight decrease. I am not, however, taking months; I think it is much fairer, when we are trying to ascertain the cost of living and to advertise to the prospective immigrant what conditions are in Canada, that we should tell him what the cost of living is for a year. The average for 1921 was $22.70, and for 1927, $21.20; in other words, the cost of living has declined.


Mr. CLARK:: What was it in 1922, 1923 and 1924?


James Layton Ralston: My hon. friend knows,
and there are gentlemen within the sound of my voice who know, that farm products and food products were almost at their lowest ebb in 1922 and there was not very much room for prosperity for either the artisan or the farmer in that particular year. I am pointing out that the period under comparison from

1921 to 1927 shows a marked decrease in the cost of living. An index figure which has been prepared by the bureau of statistics shows that not only for food but for rent, fuel, and everything else that enters into the cost of living, the figure was 167 for 1921 and 152 for 1927, and the general barometer, namely, the general average of wages, which my hon. friend suggested had gone down very materially, was 182.4 in 1922 and 184.3 in 1927. My hon. friends speak a great deal about employment. The index figure for general employment in 1922 was 87.9, bearing out what I have said about conditions which existed then; and in 1927 it was 103.4.


Mr. ERNST:: Why does the minister take figures for 1922 in relation to employment and wages, and figures for 1921 in relation to the cost of living?


James Layton Ralston: I cannot tell my hon.
friend at the moment what the 1921 figures are. I should be glad to get the other figures or to have my hon, friend give them.
As regards this matter of advertising Canada, the hon. member for Fort William (Mr. Manion), who is generally an optimist, I think rather threw a wet blanket over this house and1 he certainly did not play the part he generally does in advertising Canada when he made his reference to " thousands of closed plants from the Atlantic to the Pacific." I do not think that is a fair statement. I think the hon. gentleman, perhaps in the heat of his enthusiasm, went further than he intended. But I would point out that these things are not good advertising for Canada, and I think my colleague the Minister of Railways (Mr. Dunning) has quite truly said that no better propaganda could be used by United States immigration agents, and more than that by immigration agents from other dominions of the British Empire who are seeking immigrants from the old country. If they are able to show that responsible members of the House of Commons make these statements regarding conditions in Canada, it seems to me we put into their hands an argument Which they cannot fail to use for the benefit of settlement in their own country.
I make these references only in passing because there are one or two matters with which I want to deal in regard to the steel industry, the fishing industry and general tariff matters mentioned in the budget.
Tabulations have been made and issued showing what has been done and what remains to be done under the document known as the Duncan report, and from time to time it has been suggested that a large percentage of the recommendations still remain to be

The Budget-Mr. Ralston
carried out. I am not going into details in connection with that report to-day except for the purpose of introducing a few words that I have to say with regard to the steel industry.
These tabluations have treated every matter mentioned in the Duncan report as of equal value: they have had no regard whatever to any sense of proportion. Now there are major matters dealt with in the Duncan report, and there are minor matters, and I want to point out that the five major matters dealt with in that report are:
1.	Freight rates,
2.	Money grants,
3.	Coking plants,
4.	Statutory harbour commissions,
5.	The steel and coal industry generally.
I want to say to this house and to the
province of Nova Scotia that in so far as the first four subjects are concerned, with the exception of the general financial revision which was suggested in the speech from the throne, they have practically all been dealt with as far as they legislatively can be. There still remains the matter of the steel and coal industry outside of the matter of coking plants, and that is what I desire to deal with now.
A good deal of talk is made in this country and has been heard in this house in regard to blast furnaces and as to the primary activities of the steel industry having gone down remarkably in the last few years. The hon. member for St. Lawrence-St. George the other day read a most doleful statement with regard to blast furnaces. I also heard my hon. friend from Port Arthur-Thunder Bay (Mr. Cowan) make the statement that there were 22 blast furnaces in operation in 1913 and only 4 to-day. I understand that my good friend the leader of the opposition (Mr. Bennett), speaking in Montreal a day or two ago, referred to the blast furnace industry as having been seriously depleted.


Richard Bedford Bennett: The steel industry, 1
said.
Mr. RALSTON':	But all these gentlemen
failed to note that there were two periods of government between 1913 and 1927, namely 1912 to 1922 and 1922 to 1927, and when I tell them that the blast furnace industry was worse in so far as employment and production was concerned in 1921, I think it will be seen that perhaps my hon. friends have not paid as much attention as they should have to the effect of the argument when it comes to deciding which party should govern this country. The period is 56103-64
taken from 1913 to 1927, the figures are given, and that is all that is suggested. Now I want to give the figures.
In 1913 the number of men employed in that industry was 1,589. My hon. friend from St. Lawrence-St. George gave the figure for 1925 as 656, but he did not say that in 1921 there were only 614, and he did not say that in 1927 there was an increase of 20 per cent, or 734.
With regard to production, and that is a very much more important item than how many furnaces are working part of the time,
I find that the annual production of pig iron in 1913 was roughly 1,000,000 tons; in 1921, 593,000 tons; in 1927, 907,000 tons. So our friends, if they want to find out what happened to the steel and blast furnace industry, will have to go back to the years between 1911 and 1921.


John Arthur Clark: Why not take the year 1920 instead?


James Layton Ralston: Perhaps my hon. friend
will permit me to make my speech; I do not trouble the house very often.
I want to give my hon. friends another figure, and that is with regard to the balance of trade in steel products. My hon. friend from St. Lawrence-St. George suggests that we have a very large adverse balance of trade in steel products. In 1912 the adverse balance was $101,000,000; in 1921 that had grown to $169,000,000; and in 1927 it was back again to $106,000,000.
I want to say a word or two for the benefit of my hon. friend from Pictou (Mr. Cantley) who knows more about the steel industry I suppose in five minutes than I can hope to know in my lifetime, but I have the temerity to suggest one or two figures and to make one or two statements as to what the records show.
It is suggested that the steel industry has gone to the demnition bow-wows because of the fact that there was a drawback put on the duty on agricultural implements. I want to remind my hon. friend-I know he is fair enough to admit it-that the steel industry in Nova Scotia never got its real foundation until the legislation of 1897 which was introduced by the Hon. Mr. Fielding in this house, and I think he will also agree with me that from that time on the steel industry in Nova Scotia prospered. Mr. Fielding gave assistance to the industry first in 1897 for a period of five years. In 1899 this assistance was made continuous for another five years, but at a diminishing rate. In 1903 he increased

The Budget-Mr. Ralston

the diminishing rate of assistance which was being given, and in 1907 he gave a further extension of that assistance.
I also want to point out to my hon. friends who are very solicitous about the use of Canadian ore that Mr. Fielding was the one who introduced legislation in 1907 providing for special assistance to any industry which would use Canadian ore. But what do we find? Our friends opposite came into power early in 1912, and did they revive the assistance which Mr. Fielding had given? Not a bit of it. Did they repeal the rebate on material used in the manufacture of agricultural implements? Not a bit of it. They left the rebate there; they left the industry without the assistance which the Liberals had given. I make no complaint whatever about their not cancelling the drawback on agricultural implements, but surely they should not complain of Liberal policy when they are the ones who did not raise a finger to help the steel industry in any practical way.
Further than that, I find that they did do something else to the steel industry in 1914. A further drawback was introduced whereby wire rods were practically put on the free list, because a drawback of 99 per cent was given. The result has been that most of the iron for wire fencing of certain gauges has come in and has been used under that drawback, and thousands of tons are being imported at the present time. That was under the Conservative administration. I make no complaint about it whatever. It is along the line of Liberal policy, which is to do the best it can for the industries of this country and at the same time to encourage the primary producers. That was the policy which Mr. Fielding introduced. The steel industry, judging by experience, cannot hope for much help from my hon. friends opposite. A good many tears are being shed, but they amount to nothing more than tears when it comes to the matter of practical assistance.
The other evening one hon. gentleman said that farm tractors were put on the free list in 1918, and the imports of farm tractors have grown tremendously, from $2,000,000 in 1925, to $5,900,000 in 1926, and $8,021,000 in 1927.
I am not complaining about that. It has meant cheap tractors for the farmers, but do not let my friends opposite weep and wail on behalf of the steel industry when they were the party who made these reductions.


Richard Bedford Bennett: I suppose the war had nothing to do with it?


James Layton Ralston: I am not talking about the war at all: I am talking about the steel industry.
fMr. Ralston.]


Richard Bedford Bennett: So was I.


James Layton Ralston: I want to say a word with regard to the present situation. The steel industry , as I said, was dealt with in the Duncan report. I do not think anybody in this country regards the steel industry as being absolutely defunct. The records of the price of stock of the Steel Company of Canada do not so indicate, but there are primary industries, in Nova Scotia particularly, which do not enjoy the same advantages which the industries of central Canada have. The Nova Scotia industries are a long way from the market. They constitute the only self-contained British industry on the continent, and you can judge of the importance of the industry to Nova Scotia, when I tell you that 50 per cent of the assessment under the Workmen's Compensation Act is .paid by the coal and steel industry. ^ The Duncan commission heard evidence in connection with that industry and made 'their recommendations, and their recommendation was that the steel industry of Nova Sootia should be given similar assistance to that given the steel industries of central Canada. These steel industries are given a rebate of 99 per cent of the duty on coal used in the melting and smelting of metals. That was their recommendation. There has been a good deal of talk in this house and in the country as to why the government has not implemented that particular recommendation. I would would remind hon. members of what was said at the time. Speaking in this house on March 18 last the Prime Minister said:
. Owing to the existing uncertainty of conditions surrounding the iron and steel industry in the maritimes, the government does not feel in the position to make at present any pronouncement with respect to the commission's recommendations of a renewal of the system granting bounties with respect to steel when Canadian coal is used in its manufacture.
It will be remembered that for the last year and a half the industry has been in the throes of litigation. To announce that assistance would be given to the steel industry, with two parties contesting for its control, would simply mean throwing something extra into the ring to be contested for; on the other hand, to announce that no assistance would be given would be to throw the industry on the bargain counter. Therefore the government did not make any pronouncement whatever. That position was amply supported, not simply by Liberals but by Conservatives as well, in the press of Nova Scotia. I have in my hand a statement made by the Hon, G. S. Harrington, Minister of Public Works and

The Budget-Mr. Ralston
Mines in Nova Scotia, published a day or two after the Prime Minister's statement in this house. Mr. Harrington said:
There will be general regret that the present disturbed condition of the steel and coal industry has led the government to defer beneficial action toward it in keeping with the report. It is no secret, however, that a very general organization of this industry is requisite. At present it appears to be passing through the unsettled stages essential towards that end. It is to be hoped that very shortly it will emerge in a condition that will merit and obtain for it consideration as a great national asset as necessary to the rest of Canada as it is beneficial to Nova Scotia.
The Halifax Herald of the same date said:
It is not necessary to discuss the present litigation affecting the steel industry in support of such an attitude-
Meaning the attitude of the government.
-the necessity for this reservation is selfevident.
A similar statement appeared in the Sydney Post of March 21. I submit, Mr. Speaker, that these references amply confirm the soundness of government's position. Only recently has the announcement come that litigation has been terminated and that control of this great industry has definitely passed into the hands of a new and strong financial group. But there still remain certain things to be done. It seems to me that it is in the interest of this industry and in the interest of the Dominion that-first, there should be unity between the coal and the steel businesses. Secondly, there should be a shrinkage of the capital so that the industry will have an opportunity of earning a dividend on some reasonable investment. Thirdly, the unwieldy organization should be simplified. It now consists of some fourteen companies. Fourthly, there ought to be co-operation by the provincial and municipal authorities in the work of building up this great industry. With the litigation ended and these conditions met, the way will be open for serious consideration by the federal government of the presentation of the real and legitimate needs of the industry.
Now, Mr. Speaker, I want to say a word in respect to the fishing industry dealt with by my hon. friend from Queens-Lunenburg (Mr. Ernst). I regret that he should have seen fit in the course of the debate to suggest that political considerations dictated the sittings of the commission which is now investigating the fisheries of the maritimes provinces. Let me say to him and other hon. members that the places where the commission was to sit were selected solely with the desire that the commission should get just as close as possible to those engaged in the industry so that every man might have an opportunity of presenting 56103-641
his arguments or views. The idea was that the fishermen of the maritime provinces and a portion of Quebec-which was also included -should have an opportunity of being heard. The commission got tc- work in October, and even though the weather was inclement they proceeded with their inquiry, their desire being to have their report ready for this house at this session. The commission held over forty sittings, travelled sixty days and heard 818 witnesses. Naturally a good deal of expense was incurred, because the commission undertook to pay the expenses of witnesses, delegates elected at meetings of fishermen all over the maritime provinces, in order that their views might be presented. The commission will, I hope, be able to present its report in a very short time, and as one interested in our fisheries I look forward with a great deal of confidence indeed to the findings which it will make, because, as I have said, the fishermen have had as never before an opportunity to present their needs, their problems and their difficulties, and I am sure they will say that they have received a most sympathetic hearing from the commission.
My hon. friend from Queens-Lunenburg made some suggestions in regard to improving conditions affecting the fisheries. He mentioned the matter of trawlers. I take it from What he said that he is not against the trawler, that his only complaint is .that trawlers which are not really of Canadian register are operating as Canadian trawlers. I assume that if that condition is remedied my hon. friend is favourable to the trawler.


William Gordon Ernst: The hon. minister cannot
draw that inference.


James Layton Ralston: I notice my hon. friend was very careful not to declare himself the other day.


William Gordon Ernst: I am waiting for the commission's report.


James Layton Ralston: If my hon. friend does
complain, he should look back to the period between 1911 and 1921, because that is when the trawlers 'began to operate in Nova Scotia. Then was his opportunity to protest while the business was in its infancy.


Mr. MACDONALD (West Cape Breton):: May I ask the minister a question?


James Layton Ralston: If my hon. friend will not take too long.


Finlay MacDonald: Is my hon. friend aware of the fact that trawlers were on the coast in 1908, 1909, 1910, 1911 and 1912?
The Budget-Mr. Ralston


James Layton Ralston: I have just said that
between 1011 and 1921 was the first time, so far as I know, when trawlers operated actively and successfully. Only two trawlers were operating in 1908, 1909 and 1910 and they were failures.


William Gordon Ernst: To increase fi^h production during the war.


James Layton Ralston: At that time there were two trawlers; then in 1918 they had increased to eight. There are only ten to-day. If my hon. friend was anxious to deal with these trawlers-I doubt it-his party 'had an opportunity during that long time.


William Gordon Ernst: Will my hon. friend permit just one more question?


James Layton Ralston: My hon. friend must
allow me to proceed. He suggested a constructive policy and urged that there should be efficient inspection. I think he knows that efficient inspection has been inaugurated and in active practice during the past few years, and last year a further advance was made. My hon. friend advocates collection boats. He knows that collection boats wrere put on last year and are working actively, particularly on the eastern shores of Nova Scotia. He speaks of experimental stations, and says that we are only "scratching the surface" in that regard. I think my hon. friend did himself an injustice in that respect, because he knows the experimental station which was started by the present Minister of Marine and Fisheries (Mr. Cardin) at Halifax is regarded as a model, not simply in North America but in England as well. The empire marketing board has specially mentioned the experimental station started by the government of Canada, and a request has come from the Imperial Economic Commission that the services of Dr. Huntsman -who is in charge of this experimental station-be loaned to Great Britain.
With regard to education, we have already established a fisheries course at Dalhousie university with the degree of bachelor of science in subjects affecting fisheries. I am glad to be able to tell this house that about two weeks ago nineteen young men returned to their homes in Nova Scotia after a six weeks' course under the system of scholarships promoted by this government, in order that they might apply to their work not only practical but scientific knowledge respecting the fishing industry. Those young men returned home convinced that the fishing industry will be best developed if scientific education goes hand in hand with practical work. They will be crusaders in this work.

If I mistake not the idea is to increase the scholarships to fifty for the next course.
As to co-operative marketing, my hon. friend knows, I think, that that is essentially a matter within the jurisdiction of the provinces. I would remind him that years ago a Liberal government in Nova Scotia put upon the statute books of the province an act providing for the free incorporation of fishermen who want to work together co-operatively.
With respect to radio, my hon. friend is quite right. The hon. member for Antigonish-Guysborough (Mr. Duff) was the first one to suggest that the fishing boats be equipped with radio receiving apparatus. Last year, at the hon. member's suggestion, an offer was made to the fishermen of Nova Scotia to broadcast weather reports, but the schooner owners felt that they could not equip their boats. This year, I understand, the offer is being repeated and it is probable that radio broadcasting of weather reports and bulletins will be afforded the fishermen and that the receiving apparatus will be installed on the vessels.
The hon. member also suggests that we should have wider markets. As was suggested last year when the announcement was made by the Prime Minister with regard to the recommendations contained in the Duncan report it does seem unfortunate that our friends should find out so late that after all wider markets are what we need most to encourage all industry. We had an opportunity in 1911 to secure wider markets for Nova Scotia but we did not take advantage of it, and ever since we have been looking for the chance to develop wider avenues of trade. I would remind my hon. friends opposite that in 1923 the then Minister of Finance, the Right Hon. Mr. Fielding, inserted in our tariff laws a provision that the governor in council might authorize negotiations with any authorized representative of the government of the United States with a view to the making of a commercial agreement between the two countries that might be deemed mutually beneficial. May I also point out that Mr. Fielding also provided that any time the United States reduced their duty on certain natural products, including fish, then the governor in council was empowered to do the same. This constitutes a standing offer in the direction of developing wider markets. I would remind the house further that we have a legation at Washington, and while this is an international question such as one cannot very well discuss here in so short a time, I hope it may be possible eventually to come to some satisfactory arrangement. I do not think it can be questioned for a moment that the

The Budget-Mr. Ralston
Liberal party and the Liberal government have done all in their power to secure wider markets not only for the fishery products of Canada but for our other natural products as well. In order to find markets for the products of our fisheries, the Liberal government, in 1908, I believe, undertook to pay one-third of the express rates on fish coming west. That arrangement continued until 1918 when our Conservative friends abolished it. It had proved most beneficial, as shown by the fact that our fisheries products coming west increased 300 per cent in that period. But once again a Liberal government came to the assistance of the fishery industry last session by the 20 per cent freight rate reduction.
Now, may I tell hon. gentlemen what we are doing in the matter of markets. In 1923 our shipments of fresh and frozen fresh fish to points beyond the maritime provinces totalled 35,452,138 pounds, and in 1926, 49,612,366 pounds, or an increase of 40 per cent. The shipments of fresh and smoked fish by the Canadian National Railways have increased from 7,000 tons odd in 1921 to some 15,000 tons in 1926, while by express there has been an increase from 8,000,000 pounds in 1921 to 12,000,000 pounds odd in 1926. It is obvious, therefore, that we are doing something practical for the fishing industry. We cannot discount the problems and difficulties which face the fishing industry of the maritime provinces to-day, and the constructive policies which we have put in force have indicated, I think, how fully we realize the importance of the industry. When I think of these men and of the work to which they have devoted their lives, I do not dolefully picture, as some hon. members have done, village after village of silent streets and boarded windows; rather do I see men working hard and earnestly, endeavouring to do their utmost to earn a living at a vocation which is by no means easy, but at the same time exhibiting the spirit which has characterised generation after generation of our seafaring men. Let me assure the house that it is in the improving of the conditions under which these men labour, and in the effort to help them to overcome their difficulties, that we are seriously engaged at the present time. The adversity of the fishermen is the adversity of the Dominion, and similarly the prosperity of the fishermen is the prosperity of the country as a whole. That is the reason why the government is so earnestly facing the situation and trying by every means in its power to help.
Now I want to say a word with regard to the general provisions of the budget, which has been thoroughly discussed, almost every
hon. member who has spoken having touched upon many phases of it. I should like to gather up a few of the thoughts that occur to me regarding the general effect of the budget from every point of view. My hon. friend from Queens-Lunenburg wanted to know what the budget contained for the fishing industry, for agriculture, and for the various other industries. My reply is that there is in this budget just what has been in every other budget brought down by the Liberal government since it assumed office in 1922: a lessening of the burden of taxation generally; special relief for those engaged in our basic industries and for the implements which they use in production; substantial relief from taxation of those articles which make up the necessaries of life; consideration for those who are least able to bear the burden of taxation; and the recognition that no one section of the community, or no one occupation can claim the benefit of special privileges. I have had necessarily to condense the outstanding results of this government's tariff legislation, and now I may indicate something of what has been done for each of our various industries.
What do we find in the case of agriculture? There has been a 100 per cent reduction of the sales tax on all essential implements for tilling the soil and gathering the crops, and in addition there have been placed on the free list such articles as mowers, harvesters, reapers, cultivators, harrows, manure spreaders and seed drills. Then there is the 90 per cent drawback on materials for the manufacture of general farm implements, besides a 100 per cent reduction of the sales tax and a reduction of from 33 to 75 per cent on labour-saving machinery for modern farming, the tariff rate now being the minimum. There have also been reductions of 100 per cent of the sales tax and of the tariff on fertiliers and spraying preparations, and a cancellation of the sales tax on feeds of all sorts and on general farm products. So much for agriculture.
What about mining? There has been a 100 per cent reduction in the sales tax on all machinery and equipment for the extraction of minerals from their natural state, and a reduction of approximately 40 per cent on all essential machinery.
So far as logging and lumbering operations are concerned, there has been a 100 per cent reduction in the sales tax and a tariff reduction of 33} per cent on machinery and equipment for logging and sawing up to the finished lumber.
As regards fishing, there have been the following reductions:	100 per cent in the sales
tax on all essential materials and equipment;
The Budget-Mr. Ralston

100 per cent in the tariff on fishermen's rope for all purposes up to l j inches; 40 per cent reduction in the tariff on oiled clothing; and 33| per cent reduction in the tariff on motor
engines and parts.
And in the interests of the great mass of our population, including all the others I have enumerated, we find that there has been a complete cancellation of the sales tax on the most essential foods and 50 per cent on others. My hon. friend from Marquette (Mr. Glen) in his admirable speech, gave a list of them. In addition to this, there have been reductions on the following commodities: 35 per cent on raw and refined sugar; 124 per cent on cotton, woollen and flannel fabrics; 33per cent on mitts; 20 per cent on woollen socks and stockings; 25 per cent on heavy woollen underwear; 33^ per cent on cotton blankets; 25 per cent on sheets, table cloths, pillow cases, towels and other household cottons, and 50 per cent in the sales tax on boots and shoes. At the same time, what has happened to our industries. Have they been injuriously affected? Let me give some of the figures in regard to the number of employees engaged, and the value of the products turned out in the year 1922 as compared with the year 1926. In 1922 we find that there were 474,000 employees m all industries in Canada, producing goods to the value of 12,482,000,000, while in 1926 the number of employees had increased to 550,000 and the value of the products of industry to
$3,250,000,000.	.
Some hon. gentleman the other evening complained of the damage done to the agricultural implement industry and he made reference to the extent of our imports under this head. I, on my part, desired to know how many implements we were producing in Canada, because after all that is the barometer: we probably have to import some owing to the extensive activities in our agricultural pursuits. In 1922 we employed in this industry 6,221 workmen and in 1926 10,091; and in the former year we made implements to the value of $18,240,000 while in 1926 the value of these products had increased to $38,269,214. As regards boots and shoes, in 1922 the industry gave employment to 13,702 workmen and in 1926, 15,016; and while the value of the products in 1922 was $45,503,858, in 1926 it was $49,096,000.
So far as mineral production is concerned, my hon. friends opposite have had a good deal to say regarding the present condition of the industry. They declare that there is no mineral production going on.


Richard Bedford Bennett: No one said that.


James Layton Ralston: Hon. gentlemen have repeatedly) stated \that mineral production is not being encouraged.


Richard Bedford Bennett: That is another thing
altogether.


James Layton Ralston: Let me inform the
house that the peak of mineral production was reached in 1927, with a total value of $242,000,000. In connection with our estimated surplus for this year I would remind my hon. friends that no less a sum than $14,000,000 has been written off in connection with the revaluation of lands under the soldier settlement scheme, and we still have a balance on the right side of the ledger of $38,000,000; and as regards our foreign trade, there has been an increase in the total from $1,501,731,000, the figure for the year 1922, to $2,298,466,000 in 1927, or an increase of 53 per cent.	[DOT]
Surely the facts I have cited must convince the house that the Minister of Finance has kept faith with the people of Canada. Geography and climate have set for the founders and builders of this nation a great problem; they have created vast difficulties. Scattered along the 3,000 miles of narrow territory are communities of men and women each with difficulties peculiar to their own vocation and locality. To keep faith with all parts of the Dominion requires courage, sympathy, judgment and sincerity. I believe that not only this house but the people of this country as well will agree that my hon. friend the Minister of Finance possesses these qualities to a marked degree.
I want to remind my hon. friend that not only must the government keep faith; not only must the Minister of Finance keep faith, but the people of Canada must keep faith one with the other. There must be mutual tolerance and mutual forbearance regarding the various problems which present themselves in their various callings and localities. To turn over the pages of this budget and simply look for those items which will give a direct and particular advantage to any individual industry or locality is not and never can be the test. I say that a study of this budget and of the budgets which have preceded it will show the same principles in all; consideration for the masses, relief from taxation, stimulation of production and encouragement of industry, and .so long as these principles are maintained in our budgets no class or section of Canada need have any fear. In a word, Mr. Speaker, I think we can regard this budget as a stimulating new chapter in that book of "all-Canada" budgets which have been

The Budget-Mr. Neill
brought down by the Liberal government since 1922; I believe it will be received in that spirit by all parts of Canada and that it will receive genuine support not only in this house but throughout the Dominion as a whole.


Mr. A. W. NEILL (Comox-Alberni):: Mr. Speaker, I hope you will excuse me if I do not appear to address myself so much to you as to the hands of the clock, which haunt me with the ghastly record of how quickly the few minutes allotted to me are passing away. With regard to the budget, if everything which has been said in its favour is true it is indeed a thing beloved of God; if, however, everything which has been said against it is true it is what the man in the street would call a holy terror. After listening to the extreme views on both sides of the question for nearly three weeks, I have decided to believe neither side. At any rate, the budget is a fait accompli now; it has been brought down and the government have a majority with which to pass it, so time will show the result. I would prefer now to discuss one or two points on which the policy of the government has not yet, been declared1, in the hope that when they come to formulate a policy they will at least give some consideration to the views of British Columbia, which I propose to express.
_ The first thing with which I wish to deal is the Australian treaty, and I must say I am surprised that the Minister of Finance (Mr. Robb) has not thrown the Australian treaty in our faces and cancelled it long before this, referring particularly to the members from British Columbia. After a great deal of trouble he negotiated a treaty calculated to promote trade for one of the great industries in Ontario, for the paper industry of Canada and particularly for the pulp and paper and fish industries of British Columbia, with the promise that further negotiations would include lumber, which was very desirable. But, with the exception of myself, I cannot recall having heard one word of appreciation of that action of the government, and particularly of the Minister of Finance, coming from hon. gentlemen opposite, whose constituents have been so vitally benefited by this particular treaty. Those benefits will increase in the future, because a treaty does not produoe results in a moment; it takes time for its effects to become fully developed. The hon. members from Vancouver in particular have come here annually opposing that treaty; in fact they voted unanimously in support of a want of confidence motion based primarily on the
Australian treaty. Vancouver is the port through which 92 per cent of the import trade with Australia passes as well as 36 per cent of the export trade; Vancouver is the headquarters of the big interests connected with the fish, lumber and pulp and paper industries, which reckon their investments not in millions but in hundreds of millions oi dollars; but these members, although knowing the benefits which have been derived from the Australian treaty, come here shedding crocodile tears because, forsooth, they say harm is being done to the dairying interests by that treaty. They say that the price of butter has been lower in consequence, although it happens to be a matter of fact that the price of butter has gone up instead of down, due to causes entirely apart from the Australian treaty. But what is a little trifle like that when it is a question of some party advantage? Well, might I paraphrase those well-known words and say, " What can they know of Country, who only Party know?" That is the situation to-day.
Three or four years ago, after a good deal of effort, we succeeded in passing a measure for the protection of the dairying industry by doing away with the sale and manufacture of oleomargarine. I appealed then to hon. gentlemen opposite to vote for the measure on the basis of protection, but did they do so? Not at all; .their concern then was the working man of Vancouver. They said he must have a cheap spread for his children's bread; they were the urban representatives then and must have regard for the working man. Very well; let us apply the same argument to the suggestion that the Australian treaty would reduce the price of butter, although that has not proved to be the case. Let us suppose that the treaty had that effect; according to their argument, would this not be an advantage to those workers for whose welfare they were so solicitous a few years ago? But that does not seem to work. Is it a fact that as far as they are concerned the working man is only entitled to oleomargarine on his children's bread, and should not have butter? Probably it all comes down to this; when it comes to a question of party advantage the workman, the dairyman and everyone else gets the go-by.
That is what these hon. members say here, but what do they say at home? Their speech is very modified there. Probably they will deny having said anything I might attribute to them, but I have with me some statements appearing in the Vancouver Province, the best and biggest newspaper in the west. This is a strong Conservative paper and it is also very
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fair, much more so than the candidates it supports. During the election campaign the Vancouver Province stated that the negotiation of the Australian treaty was the brighest gem in the record of the Ring administration, and one of which they might well be proud. That statement was not published during a time of peace, -but in the midst of an election campaign. I also have another editorial which appeared as late as last January, in which they said that if British Columbia wants the treaty retained, the British Columbia members would do well to make their wishes known emphatically. Have we heard them? I have not. Another Conservative paper in British Columbia states that the cancellation of the treaty would be a disaster. Have we heard that view expressed from the opposition benches? I have not. Party politics become of greater importance than the interests of British Columbia.
The results of the operation of the treaty are alleged to have been unsatisfactory, but in the twenty-four months after that treaty came into operation we increased our exports to Australia by thirty per cent; and as I have said, a treaty does not work like putting a penny into a slot machine; it takes time to reach the maximum benefits. However, we have had an increase of thirty per cent in our export trade; I have not taken the import trade into consideration, because our exports are the more valuable to us. The fish and pulp and paper industries of Canada, which largely means British Columbia exported to Australia in that period $9,500,000 worth of goods, and as most expenditure's of that size naturally do, that resulted in increased work and stimulated industry. In fact, it stimulated the fishing industry so much in the direction of canning the more common grades of salmon, that the government, which had never taken any action in that direction before, were forced to place restrictions on the canners, because the British Columbia waters were being overfished in regard to these grades. That was one instance alone. The pulp and paper towns were busy and the bush was full of workers. Hon. members know how trade acts and reacts. Well, this wave of business extended to the coal industry. We cannot pack $9,500,000 worth of stuff in a canoe and take it to Australia. So it had to be shipped, and the ships carrying those -commodities had to have coal, and the coal was mined in our district. Thus work was given to shipping, to coal miners, to workers in the bush, and in the paper mills and the fishing industry. Then these workers provided a ready and profitable market for vegetables, for fresh butter, for fresh cream and ice cream and for fresh milk Mr. Neill.]
for those engaged in the dairy industry in that particular vicinity, and anybody acquainted with farming knows that that is a far better market than sending butter to Liverpool to compete there with the products of the world.
A great hue and cry was raised by these same hon. gentlemen-in support of this I can quote from the speeches they delivered in my district during the election-to the effect that the egg industry of British Columbia was going to be ruined on account of this disastrous treaty. As a matter of fact I do not believe a single dozen of eggs has come in under the treaty. But that did not prevent the hue and cry that went up at the time. As far as Australian butter is concerned, the danger was not great of hurting the industry in British Columbia or in Canada provided that the dumping duty, of which I will speak later, was maintained. In 1926 the importations of butter into Canada from Australia amounted to 2| million pounds. In 1927 owing to the dumping duty being imposed it had dropped to 800,000 pounds.
The National Dairy Association have presented three' resolutions to the government. The first one asks that the Australian treaty as applied to New Zealand be cancelled. I am heartily in agreement with that and I will give my reasons later. The second resolution asks that the dumping clause be applied, on all butter sent from Australia to Canada either on direct sale or consignment as long as the Paterson scheme' of bonusing exists. I agree with that suggestion and I will go further. I suggest that the dumping clause should be strengthened. I have reason to believe that the Paterson scheme will fail. It created such fictitious prices in Australia that New Zealand also sent its butter into that market, so I believe Australia may abandon the Paterson scheme altogether. I am in favour, I care not who calls me protectionist, of the maintenance and the judicious use of the dumping clause. It may be said that the dumping clause is dangerous. So is a revolver dangerous; in the wrong hands. A revolver is a very handy thing to have in the middle of the night when you hear a burglar moving downstairs. It should be used with discretion and so should the dumping clause. In any event I believe it should be there to be applied when needed. You remember the missionary in the days when Indians used to scalp settlers, who said that he was not afraid because the Lord would take care of him until his time came, but some friend said "Yes, that is all very well, but how is it that whenever you go out

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you take a particularly vicious looking shotgun. with you?" His reply was, "That's all right, I'm not inconsistent. The Lord will take care of me, but supposing I happen to meet an Indian at a time when I had not my shotgun, and his time had come, what would the Lord think of me for not having the machinery to carry out his will?" The same illustration might be applied here. When we need the dumping clause let us have it on the back premises ready to be applied whenever occasion demands. I am strongly in favour of the maintenance of the dumping clause for general use, applied very discreetly, and in favour of its application in the present instance.
The third resolution asked that the Australian treaty be done away with altogether.
I am flatly and entirely opposed to that. You do not burn your house down because there are mice in the basement. Because some phase of the treaty has operated unfairly to Canada the remedy is not to do away with the treaty, which has untold potentialities in the way of trade for the whole of this Dominion. Moreover if the first and second resolutions I have quoted, were brought into effect, there would be no need for the third resolution at all. I repeat that I am entirely against doing away with the Australian treaty.
Coming back now to the first resolution asking for the abolition of the Australian treaty as applied to New Zealand. That feature of the treaty was never introduced into this house; if it had been I should not have supported it. It was put into effect by order in council and I am against it. I understand it was intended as a sort of quid pro quo for the preference they had given us. Well, that is possibly true, but it is too high a price to pay for such a concession, and in any event it is not fair that one industry should have to bear the whole brunt of the effect of the arrangement. The real danger in connection with this Australian treaty is entirely from New Zealand, and I would support the immediate cancellation of the arrangements so far as New Zealand concerned. It may be said, and I have been accused of it before, that I have been making a protectionist speech. I care1 not what epithet is applied, I am only applying the principle of common sense to conditions as they happen to exist. I believe that like the Sabbath, the tariff was made for man and not man for the tariff. So much as regards the Australian treaty. My suggestions in that regard are: that we should keep the treaty for the benefit of the big industries of British Columbia and the workers thereof; that we should
keep the dumping clause and strengthen it if necessary; that we should cancel the treaty as regards New Zealand. These are my own views I think they are the views of my constituents, and I challenge any member from British Columbia to say that the carrying out of such a policy would not inure to the general benefit of the province of British Columbia.
I want now to speak for a moment on the subject of immigration. To begin with, of course, being a British Columbian, I will touch on the oriental question, but briefly. It is true that we were promised oriental exclusion when the oriental resolution was going through this house in 1922. We were told then that the words " effective restriction " would have the same effect as exclusion. That promise has not been carried out in its entirety. I will admit all that has been said by the hon. Minister of Health (Mr. King), when he said the Conservative party had done nothing along those lines, and that the Liberal party were entitled to the credit of having passed the Chinese Exclusion Act in 1924. They also made regulations which have resulted in the control of the fishing industry passing from the Orientals to the white people. Furthermore, they got the Japanese " gentleman's agreement " cut down so that the immigration under it amounted to 150 labourers annually instead of 450. But that is not enough. We want more. We want the abolition of the " gentleman's agreement " altogether or its material alteration. We object to allowing women to come in practically unrestricted, and also to putting the control of immigration into the hands of a foreign nation instead of retaining it in our own hands. I know that negotiations have been going on to amend that " gentleman's agreement ", but I declare here that I am not satisfied that our officials have exhibited the energy they should have in pressing forward our view of the matter. Orientals will stand us off as long as they can, but if we keep the whip hand and exercise the proper amount of pressure I have no doubt we shall achieve a satisfactory result. I give all credit to the statement of the Prime Minister the other day when he said that there were interimperial reasons why we should do nothing that would appear to be offensive, also that we do a large trade with the orient and hope to do more. I admit that, but I do not admit a contention made by the hon. member for Fraser Valley (Mr. Barber) the other day when he spoke in this debate. I agree with much of what that hon. gentleman said, but I do not agree with bis statement that the United States have lost no trade by their somewhat offensive language in con-
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unction with this matter of oriental immigration. They have lost an enormous quantity of trade. He do not want to lose any trade if we can help it, but nevertheless I take my stand with him that under any consideration we must adhere to our vision of a white Canada and I hope the government will lose no time in having the gentleman's agreement " properly altered.
Now as regards immigration generally, I wish to say, and I am sure that I shall receive small sympathy when I do so, that I am a heretic to the conventional ideas of both sides of the house. I do not agree with the immigration policy of either party. I oppose the policy of the Conservatives which I know. I am not quite so clear as to what the Liberal policy is, but to the extent to which it is indicated by the methods by which they have attempted to carry it out, I do not agree with it. Where does this cry for a vigorous immigration policy come from? It is a sonorous phrase and it sounds very nicely but where does it come from? If we track it down to its origin, it comes from the shipping interests, from the railway interests, and from the big employers of labour, who hope by that means to form a great bank of idle labour, of ignorant alien labour, which by its ignorance of our tongue and its inability to express itself at the polls will be always a cheap, submissive source of supply for them. One would suppose that the very obviousness of their self-interest would largely detract from the strength of their representations, but it does not seem to be so. And forsooth, this class of immigrants is to be assisted to come here at enormous expense. I have been a worker practically all my life; I now represent a large number of workingmen and women, and I fiercely resent the idea that they should be taxed in order to bring in workers to compete with them in the often congested labour market in which they seek to make a living. We talk about protection. Is there protection of the workingman there in regard to the only thing he has to sell? His labour, is it protected? We talk about free trade. Is that free trade in labour? No, it goes far beyond that; it is fifty degrees below the zero of free trade when you ask a man to pay to bring in a competitor to compete with him.
Another method I object to-it is not a method; it is a phantasy-the belief that we can bring labourers in from southern Europe, from the sunny towns of Italy, to work on farms in western Canada. The other day I met in Toronto a man who had come out under this assisted passage scheme to work on a farm in the west. I asked him how he Mr. Neill.]
landed in Toronto and he said: "I got off the train in Montreal and asked a policeman where the train for Toronto was and I got on it. What can you do about it?" I said:	"You
can be deported." He said:	"It would be
hard to find me." He never went near the prairies. I have jKo doubt he figures in a statement made recently by hon. members opposite when they drew a picture of so many agricultural labourers being imported into the prairie provinces in a given period and of how in the next census they were not there, and they immediately jumped to the conclusion that these people had gone to the United States. That is not the case. This man and thousands like him have gone not to the United States, but to Toronto, and1 I presume they are shown there as part of the natural increase. It results in Toronto getting a reputation for fecundity to which it is not entitled. I am against this system, not because it is wrong but because it is impossible and you cannot enforce it. When this investigation into the immigration department is carried out, I venture to predict that it will be found that the heads of the department are not grafters but clean men, and that a good deal of the unpopularity from which they are suffering today is because they have loyally and steadfastly set their faces against political and other pressure from outside seeking to bring in immigrants at so much a head.
It may be said:	Why, this man wants to
stop all immigration! Not at all. My policy is simple and fair and it has the great advantage of being enforceable. I would allow two classes of immigration: I would allow into Canada every white British subject, sound in body and mind, who pays his own passage here. The fact that he has been able to scrape together the money to come here, as I did, as an immigrant, will guaranteee in some sort that he has some stamina and is likely to make good under the different and somewhat difficult conditions in which he will find himself in this country. As regards the continent of Europe,
I would impose a very strict quota, what is known as a family quota; that is, that no one could come in except someone who was an immediate relative of the man in this country who nominated him. An alien who comes here and fails to make good would not likely want to bring in his relations; but when an alien comes here and makes a good citizen, as many of them do, his son or his brother is also likely to make a good citizen, and at any rate the fact that he would be responsible for his maintenance for a certain period and furnish him with work, would guarantee' that the man would not likely be a waster. I would allow that small family quota.

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There is nothing sensational, phenomenal or spectacular about this policy. Sometimes statesmanship consists in doing the obvious and I am asking only that we should imitate our neighbours to the south who have had four or five generations of experience before us in this matter. They have tried the open door and they are now trying the quota system. They wish they had tried the quota system sooner, and I notice that when they deal with the quota, they strengthen it rather than make it slacker.
Another feature of my policy is that the millions that are now being spent in this futile immigration policy we should be able to use in improving the conditions of the farmer, making them more attractive, and especially by research and other methods endeavouring to do away with seasonal unemployment and to promote all-the-year-round work. In addition we would be able, out of those millions to provide old age pensions and unemployment insurance, things that the very best kind of British settler we want in western Canada is accustomed to to-day and is reluctant to leave; and he does not care to go to a country where these advantages are not before him.. If we provided these, we would be more likely to get the best class of immigrant we want.
As regards immigration to the United States, of which we have heard so much nonsense-I think that is a parliamentary word-the large centres will always attract population from the smaller ones and the country districts. That has been the case from the time of Aristotle and it will be so for all time. Let me take Scotland as an illustration. Scotland is a small and in some regards a poor country and it has an enormous export of young men and women. They go largely to England and indeed all over the world. That naturally depletes the population. What do we do about such a situation? Do we howl to the government: Save us; stop the young blood from going away? Not a bit of it. Do we howl to the government about bringing in aliens from somewhere else to fill up the gaps? No. The Scotch take the very sensible method of going in for bigger and better families. In the family of which I was a member and in the families in which my father and mother were respectively members-three families in all- there were thirty-seven children, and that was no exceptional thing at all in Scotland at that time. It was in that way that Scotland dealt with the loss of her young people and the method possesses three virtues beloved of the Scottish race. First of all, it was economical; second, it was profitable and, third, it was pleasant.
I have in my hand a pamphlet called Immigration and Population got up by some of the best scientists in the United States, scientists employed not to secure an ex parte statement as we do out of figures, but to get the truth and nothing but the truth. They went very thoroughly into the whole situation; they took different periods and states and so on, and this is the conclusion they came to. They said that after a certain point had been reached-and I will indicate that point in a minute-this is what they found:
Except for brief periods, immigration will not increase the population-
That is rather startling.
-above the figure it will reach without immigration. .	.	. If we admit those from
other lands we shall decrease by a like number those who will be born of those now here.
They end up with this statement:
The question for cold-blooded consideration by the American of to-day is this: Do you want the soil inherited by your son or by the son of one who now toils in a foreign land?
That question applies with equal force to the Canadian. What happens once that certain point is reached is this: The birth rate of the local people, so to speak, of the people in America or Canada declines in exact proportion to the immigration. What is that certain point? It is proved beyond doubt by statistics that cannot be denied-and I have submitted this to professors and other learned men and statisticians and they say it is true-in the United States the change took place the moment the supply of readily available cheap land which would produce food for practically nothing was exhausted. Of course if you pour immigration into an empty country, it is bound to be good for that country; but when the saturation point is reached, when there is no more good accessible land to be had for nothing, it is like pouring water into a pail; you may change the water in the pail but you will never get it any fuller. It might be said that our conditions are different. Yes, but where have we cheap accessible lands to be had for nothing? Only in the Peace river country and that is not really accessible. In the method I have suggested we would have at first, unlimited immigration from Great Britain, which would meet that situation. If these things are true, and they have not been contradicted, we have been spending millions for immigrants to come to Canada which will not increase our numbers, and will merely change the complexion of our population.
These are my views on the Australian treaty and on the immigration question. I am prepared to support this or any other govern-
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meat which will bring down a policy of that kind. I do not think I have been verbose or wasted much time in discussing these matters. I want to discuss now the biggest problem in British Columbia, and that is in connection with our fishing industry, but I cannot tackle it to-day on account of the forty minute rule. It is surely a bad rule that prevents a representative of the people discussing a matter of great importance to his constituents at the proper time, and this is the proper time. We were told that there was to be a merw heaven and a new earth when this new rule was introduced. We have had two debates since, not particularly contentious, and both have lasted longer than they did before. We have had the spectacle of three or four cabinet ministers cut off in the apex of their arguments, in the very crux of what they were explaining. They had been attacked and they were defending themselves, explaining matters about their department that we had a right to know and which the house and the country had a right to know, and yet they were cut off in the very midst of their argument by this new rule. We also have this situation, that forty or eighty or a hundred men can attack a cabinet minister for forty minutes each, equivalent to eleven days of sitting, and then he has only forty minutes to reply to the one hundred members, or less than half a minute to devote to each. He must be a superman if he can do it. I hope that we shall realize the real dangers of this rale and that with your full consent, Mr. Speaker, it will be relegated to the oblivion from which it came, unwept, unhonoured and unsung.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Mr. G. R. GEARY (South Toronto):: Mr. Speaker, what a change is here! Time was when the hon. Minister off Finance (Mr. Robb), on making his budget speech could look for, and did get, a pleasant chorus of praise from all the benches to your right, sir, and from those in the far comer on this side of the chamber. In some way or another the burden of that chorus of praise is changing; there is an ever-widening rift within the lute. The hon. minister might have expected from the official opposition searching criticism because sharp differences of principle are involved; but his own supporters, straight-line Liberals, damn this budget with faint praise, and the Liberal-Progressive party-adopted or kidnapped adjunct of the Liberal party-for 
the most part have sat in sullen silence, until this afternoon the hon. member for Marquette (Mr. Glen) did essay a few apologetic reasons for supporting the budget; our hon. friends, the contingent from Saskatchewan, never in the house noted for being inarticulate, to say the least, have sat strangely quiet; the group on my left has protested with some force and vehemence-and that, I am afraid, is the " most unkindest cut of all ". My hon. friend will remember how in other days his party and that group were
Two souls with but a single thought,
Two hearts that beat as one.
But no'w, Mr. Speaker, that group has torn the mask of smiling friendship from the government's face and at long last has awakened to a true understanding of its methods. Hon. members will recollect how this government once had the habit firmly fixed of being saved in parlous times by the hon. gentlemen, not forgetting the hon. lady, who sit to my left. Have those happy days gone forever?


An hon. MEMBER:: It looks like it.


George Reginald Geary: Or are they to return? I rather think the government hope that it is a temporary eclipse only and that the light of favour will shine again. The government has experience upon which to base that hope. But perhaps, to change the simile1; the pitcher has gone once too often to the well.
My hon. friend from Mackenzie (Mr. Campbell) has told the house how the siren voice of the Prime Minister has seduced these Liberals of Manitoba-or Liberal-Progressives, as they call themselves-from their allegiance, how that same voice has lured them to destruction-to destruction that is inevitable when one abandons principle. I am wondering what these Liberal-Progressives are going to say to their ardent free-traders back home. And so with the Saskatchewan contingent, I wonder what they are going to say; are they going to excuse their voting for this " fencemending " budget by declaring that they made themselves, privately, a thorn in the side of the government? Are they going to tell of the desperate struggles in ministers' rooms and behind the closed doors of caucus to get a different sort of budget?
The hon. member for Weyburn (Mr. Young) is not in his seat. I should like to have him explain the strangeness of the coincidence in regard to his motion to repeal the dumping clause of the Customs Act. It was at the top of the list, called' for hearing time and again, if my memory serves me aright, but in some mysterious way it disappeared from the order paper the day before the budget was brought down, and bv some

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magic reappeared the day after. Had that anything to do with the feelings of Saskatchewan with regard to the budget? Are the Saskatchewan members of the opinion that what they thought were the policies of the Liberal government have been treated fairly in the budget? I should be very much surprised to know that all is unanimity between the government and the Saskatchewan group. I wonder if my friend from North Battleford (Mr. McIntosh) will explain his vote on the budget by telling his constituents at some great meeting in the "little red school-house" how opposed he was to it; how, to be sure, he did vote for a 10 per cent reduction in the income tax, but that that was only because he was able to make to this house the brilliant suggestion that the money would be replaced by voluntary contributions towards the extinction of the national debt.
My 'hon. friend from East Calgary (Mr. Adshead) is ipained over ths betrayal of Liberal principles, or so-called Liberal principles. But why shed his few but friendly tears at this stage? The betrayal began in 1897 and was evidenced in the very first budget of a new-coming Liberal government. The Conservative party had been swept from office just one short year before, and "the funeral baked meats were scarcely cold" when the Liberal government espoused the policy of the Conservative party, and has never had the strength to depart in fact from that policy, although it has-notably in convention of 1919, and on platform after platform, as instanced by my hon. friend from Mackenzie-set itself up as being the advocate and proponent of something entirely different. Is it any wonder, Mr. Speaker, that the groups in this house have come almost to the point of parting with this government, with its actions, its broken pledges, so fresh in their minds?
What is the result, Mr. Speaker, of this wavering by the government from year to year on its tariff policy? Simply that its policy, if it can at all be called a policy, is in a welter of uncertainty, that there is nothing stable, and there can be nothing stable, in such a policy because it is founded on no principle and has not as a basis conviction. There is no sense, there is no stability in a situation such as this, and small wonder it is that not only are murmurs heard but open revolt is seen. Without going over again a situation which has been repeatedly explained in this house, I may cite two familiar instances which will readily occur to the recollection of hon. members. It was in 1924 that the government made a magnificent gesture in the budget speech by reducing
the duty on agricultural implements. There was a great objection to that reduction, a considerable outcry. The matter was the subject of a good deal of discussion between the government and some other people. Ostensibly the reduction in the duty was intended to effect a reduction in the retail price to the consumer, which reduction in price, judging from the illuminating speech which we heard the other night from the hon. member for London (Mr. White), has not at all eventuated. And the object further was to take from the manufacturer the undue profits which it was said he was making. Well, the manfacturers had something to say before that reduction finally passed into law and the result was that the chiefest of all these came from these conferences with the government, perfectly pleased and content, and in due course of time he became a minister of the government and, so far as we know, has lived happily ever after despite that handicap. In the net result, if there was any reduction in price to the consumer-and my hon. friend from London shows that there has been no reduction-it was effected, while ostensibly by a reduction in the tariff, in reality, after negotiation, by a reinstatement of that reduction by other means which placated the manufacturers. There was another magnificent gesture in 1926 at the instance of the hon. member for Macleod (Mr. Coote), the duty on automobiles being reduced in that year. That reduction was made with a good deal of eclat and considerable support was expected for the government in consequence. Thousands of workmen came to the city of Ottawa to protest and the Minister of Finance (Mr. Robb) struck an attitude:
Come one, come all! this rock shall fly, From its firm base as soon as I.
Or, to use his own words, " I will stick to my guns." Did he stick to his guns? No; more conferences and more meetings in private, and at the end of these conferences the manufacturer emerged with a smile of complete satisfaction. If there has been any reduction in fact in the price to the retail consumer on these particular products that reduction has been effected at the expense of the general funds of the Dominion.
I submit that the same lack of principle is carried into the budget now before us. Hon. members have analyzed that budget with a special knowledge which I myself do not possess and I am glad to be saved any difficulty on that score. Suffice it to say that if you take the case of the big weaving man, any reduction which he has been given-and such reduction does not appear clear in many instances, but if he has been given a reduction
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-he has received it at the expense of a charge upon the spinning man below him. There seems to be no definite principle. A mill in St. Mary, I think it is, the constituency of an hon. member opposite receives a benefit; a mill in Hespeler is sadly damaged; here the axe falls and there a benefit is given. Somebody gets something out of it and somebody else is hurt. Where can the system be found? No one on the government side of the house has attempted to explain the schedules in this budget and probably none of them can. But this fact does stand out, that it is by no means certain that any reduction has been made; there is the certainty that any reduction made will not find its way to the consumer. And this much we gather from the schedules, that if the big man is hurt in one respect he is recompensed by having the load shouldered by some unfortunate below him.
There has been called to my attention an item which I 'think is worth more than a casual glance. There is a salt belt-it may have 'been mentioned before but I apologise for not having been in the house throughout the whole of the session-a belt through the western part of Ontario, beginning, I think, in the riding of the Minister of Trade and Commerce (Mr. Malcolm), and extending southerly, bending a little off until it gets into the county of Elgin. Incidentally it passes through several constituencies represented by hon. members in this house, all of which constituencies, if my memory serves me, are by some coincidence represented, with the exception of one or two, by hon. gentlemen on the government benches. An application was made for an increase in the duty on salt. Now that is a staple household necessity and it was a bit thick even for this government to put a duty on salt. But something had to be done, for the government was sorely pressed. And what was done? The same old trick once again-the duty was taken off the coal used in the manufacture of salt.
I instance these matters not for the mere sake of repeating things that have been said before but to make a point which is clear to myself. And I make this point on my own responsibility. It is this: The whole system of taking care of unfortunate industries by drawback reductions in duty, rebate of sales tax and devices of that sort is wrong, and it is wrong no matter who has practised it in the past or who practises it now, because to my mind it is the wrong form for protection to take. If protection is good, if it is a valid and sound proposition, then it should be carried out in the open; protection should

not be got at by devious methods or by devices such as my hon. friends on the government benches practise.
In the framing of a budget, I take it, there are two principles which in the large may be followed. There is in the first place the principle of free trade, and I submit without discussing the matter further that, the late Adam Smith and the hon. member for Rosetown (Mr. Evans), to the contrary notwithstanding, the principle is unsound. But even admitting it to be sound in general, were conditions untrammelled by circumstances, it is certainly unsound and impracticable in the condition in which Canada finds itself to-day. Apparently that is not the policy of all the members of the government; I have not heard from the Minister of Immigration (Mr. Forke) or the Minister of the Interior (Mr. Stewart), who have been heard in other days to say something quite different, together with the Minister of Agriculture (Mr. Motherwell); they have not spoken this time. The Minister of Railways (Mr. Dunning) has said he is not a free trader, however, so we may take it that one member at least of the government denies the free trade proposition. Then we have on the other extreme the doctrine of protection, and with that I wish to deal very shortly in a few moments. I may say now, however, that in its national policy the Liberal-Conservative party has protected, does protect and intends to protect where protection is proper under this system, and that protection will be extended where necessary to all branches of industry in this Dominion.
The government have taken neither of these obvious courses, but have chosen to follow what they call the middle course, although it is beyond me how there can be such a thing with any sanity to it. They say they are between the high tariff and the low tariff, but on my assumption no tariff is high which does not protect where protection is justified and no tariff is low which does more than protect in a like case. On those words of low tariff and high tariff, without reason, logic or anything to back them up, the main distinction has been drawn by our opponents between ourselves and other parties throughout this Dominion. To take a middle course with no guiding principle is to veer and shift with the wind and tide, trying to navigate without a compass. In such a case the temptation is strong to take practical politics as a guide, and I submit to you, sir, and to this house that that is just what the government have done; they have succumbed to that temptation, and have even gone further. They have raised practical politics almost to a principle, and I

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think I am not going too far when I say that in their handling of the tariff policy of this country we find the very apotheosis of political expendiency. With the government attempting to drift a course, so to speak, between extremes, as they choose to say, we cannot look for anything certain or anything stable; it will always be that way with this government. They have done so before and they will do it again; we know what they have done and what their ideas are in that respect and we know that the same thing will occur again; the government have their past before them.
We have been criticized perhaps more strongly in the west than in other parts of this country, and in many ways I can well understand the attitude of the western farmer. I can appreciate, although perhaps not quite fully, the difficulties with which he finds himself confronted. In this generation he is a pioneer breaking new ground, two, three or perhaps more generations after our forefathers, those hardy spirits of his own kind who pioneered in the central provinces. From our grandfathers and grandmothers we know the privations and the hardships which must be endured in a new country, and we know that through the initial struggles of our ancestors we in the central provinces have succeeded to a settled and prosperous land, with a diversity of opportunity which was not available to them in their day and generation. The time of transition has been long with us, three or more generations, and by analogy the time of transition in the western provinces would be equally long. I take it, however, that as all in this house have the interests of Canada at heart, they will all use their best endeavours, as they see the light, to make that transition period in the case of our western country shorter than it has been in the central provinces.
While the man who took up his land in the west faced with a light heart and a sense of adventure the development <of that country, and probably for himself alone could continue with great joy the life that it entails, he has others to think of. He is married and there are children, and I can understand the feeling almost of bitterness when he sees that his wife has to face the privations and hardships incidental to land settlement and that his children are deprived of perhaps all the opportunities which the more settled parts of the country afford. It is no wonder that such a man cannot settle himself with patience and resignation to the task he has before him. In the east, in the central provinces he sees what appears to be affluence, while hardship
is his lot and that of his family, and in these circumstances I think the western farmer was an easy prey to misrepresentation of the Conservative policy of protection.
I speak of that policy as having been misrepresented. We have been assailed as a party of high tariff; a tariff high and yet higher; as high as Haman's gallows, if you please, but that is not true. The word "protection" has been used by people who do not want to give the right impression as being protection for some special interest or special person to the end that he may acquire undue profits as the result of his labour. Again, Mr. Speaker, I say that is not true. I am not at all concerned with the manufacturer beyond seeing that he has a fair chance in the struggle to get a fair return for his capital, his energy, his skill and ability. I am concerned for his workmen, that there shall be security in industrial life and a decent living wage. They call us the party of big interests, but to those who know* the texture of the Conservative party in Ontario, for instance, that is not understandable. The people of the province of Ontario would be called radicals by my hon. friends opposite from Quebec; we own the business of generating, transmitting and distributing electrical energy practically throughout the province of Ontario, with the result that we are able to give it to the consumer at cost. We own and operate our own steam railway. In my own city of Toronto we not only control the distribution of electrical energy but we own our own street railway transportation system, our waterworks and even our abattoir, and these services go to the people at cost.
In this house last year, Mr. Speaker, the Conservative party made a stronger appeal foi a workable and fair old age pension scheme than did any other party. Because we believe in that principle, and because we believe that old age pensions should come into effect, we suggested and we stand by, the only method which could absolutely ensure fairly and at once the application of the policy, of paying the whole cost ourselves out of the Dominion treasury.
The opposition led, and took a substantial share in, the victory which followed, in the fight for public control of the water rights of the Ottawa river during the last session of parliament. And yet we are called the party of the big interests, whereas through the whole history of the Conservative party the object of its policy has been towards not the big interests, whatever they may be, but towards the amelioration of the lot of the common
The Budget-Mr. Geary

people, and that is what we are standing for to-day. The big interests! St. James street! Do they like the Conservatives of Ontario? They do not. And still one would think we could not be trusted to formulate a proper protective policy that would conserve the interests of the common people.
I have little to add, but to my mind, Mr. Speaker, the only way of distributing the burden of taxation derived indirectly from the customs tariff in this country is under a principle that is definite. I submit to the house that principle is the principle of protection, safeguarded and carried into effect in the way I have suggested-by so controlling the customs duty that no one shall profit unduly. That has been stated time and time again, and was restated the other day by the hon. member for St. Lawrence-St. George. An application of that principle could be made in this way-and I am not attempting to discuss it in detail-this is an instance pf what might be done: Supposing it is found during the time parliament is not in session that someone is taking an unfair advantage of the duty. There should be power to the government, on the recommendation of a properly constituted tariff board, to reduce or do away with the duty, just as in the opposite case we have on our statute book a law giving the governor in council power to invoke the dumping clause. That could be done and would be done, and you would then do away with the present system with all the opportunities that call to the government to make use of the tariff to suit the political exigencies of the moment.
I am not one of those who think that the opposition of the farmers to the payment of income tax is based on unworthy reasons. I do agree that if a farmer does not pay income tax it is because he has not got the income which calls for payment. I take it that the farmer is an honest man and in whatever part of the country he may be he desires to pay his fair share towards the upkeep and the management of this country. While the farmer does not pay taxation through the income tax he pays it to perhaps some extent through the sales tax, a tax that we can infer is on its way to abolition, but he pays largely by indirect taxation through the customs tariff. We must have customs duties, and since the farmer must pay his share of taxation through those duties, I take it the question which concerns him is:	Am
I paying my fair share and nothing more? The policy of the Conservative party-that of protection with the safeguards I have indicated-is the only policy I submit that
rVTr. Geary.]
will ensure his paying his fair share and no more. This is a general discussion, perhaps too general, on the subject of the budget, but it goes to a principle. It goes to a principle that has been misrepresented as I have indicated. And can one feel any other desire but that of granting to the farmer his rights? He cannot. Nor can we forget the artisan, the man who works in the shop or in the factory. He surely has his rights. He has the right to stay in this country and earn his living here and not be harried back and forth at the whim of an inconstant government. It is for the working man who depends upon the manufacturer that this party stands when it advocates, as it does advocate, a policy of protection on the lines described.
There is one other phase of this tariff question which to my mind goes deeply to the root of this whole matter, and that is the question of our national life. Customs duties are with us to stay. We have to have them and the burden of taxation should be distributed on some proper and equitable basis. I take it that the house will agree with me that customs duties should be imposed upon some definite principle. This party believes that that principle is the principle of protection. Each man must decide for himself, which policy is best, but in deciding, remember that it has been demonstrated, and fully demonstrated, that lack of protection, where protection is justifiable, means, slowly perhaps, but inevitably, the disintegration of the agricultural and industrial life of this country. What follows? The drift that we see to-day, more and more pronounced, towards the south; the infiltration of United States methods, commercial and political; the substitution of United States ideals, culture, and education, and of their principles of law and justice and order for those principles under which we have lived so happily; the loosening of Canadian national spirit. In short, Mr. Speaker, it means the surrender of our national life so that we will become citizens at large and men without a country. I know well that there are some who think there is nothing but good in such an outcome as that, men who look forward to internationalism. But I am of those, and they are many, who do not want to give up their Canadianism, who cannot give up their citizenship in the British Empire. There are those of us who are even sentimental enough to feel a thrill at the sight of our country's flag, a joy and a pride in being Canadians. To those, Mr. Speaker, it is worth while to struggle and to make sacrifices in order to build up rather than destroy the national life of Canada, worth while to feel, and to think, and to work with heart, and

The Budget-Mr. Irvine
with mind, and with strength, so that this vast and splendid land will be, and will remain for all time to come, our country, ours and our children's.


William Irvine: Mr. Speaker, I think when I announce to the house that it is not my intention to make an attempt to deal with the budget in detail, I shall have a special claim for the undivided attention of this assembly. We have listened for a considerable period to the discussion pro and con of the budget. I am not going to discuss it, first, because what I might have said about it has already been said well and often; second, because a tariff policy for this country is a pretty well settled proposition, both parties being agreed that it must be continued, and third, because I have never been able to work up enthusiasm over a discussion of the means of collecting taxation as being any possible solution for an economic problem. So for these reasons I shall turn my attention rather to the remarks of the Minister of Railways (Mr. Dunning) in his speech the other evening when he made a special attack upon what he called group government and upon the principles which underlie the movement of which I have the honour to be a representative in this house.
I might also make reference to other hon. members opposite who made an attempt to follow the course of the minister in this regard. For instance an attack was made upon the hon. member for Southeast Grey (Miss Macphail) by the hon. member for West Elgin (Mr. Hepburn). I think I can answer that hon. gentleman's attack by just a single sentence. As I have said, the hon. member for West Elgin attempted to reply to the hon. member for Southeast Grey. I would describe that episode as Ian Maclaren described an insignificant and pompous character in Drumtochty. He said he was the "verra image o' a [DOT] bantam cock fleeing in the face o' judgment." Mr. Speaker, I say, let him flee. The hon. member for Southeast Grey is quite capable of taking care of herself and it is not necessary that I should rush to her assistance, but I cannot let pass the opportunity of making a remark with regard to the speech of the hon. member for Marquette (Mr. Glen). I think his speech of this afternoon was the most naive, skilful and masterly evasion that it has ever been my humiliation to listen to. After he had declared that he did not know what was in the budget, he indicated that he was going to support it. After having criticized the hon. member for South-*east Grey for having that female type of mind 56103-65
which does not require a reason, he says: "I am going to vote for the budget," and when we inquire why, he says, "Because." I should like to take the time to restate the argument of the hon. member for Southeast Grey. I am sorry that it escaped! the attention of the hon. member for Marquette and I think he ought to read it again because, if he can answer the argument of the hon. member for Southeast Grey, he owes it to this house and to his party to do so. The facts which she marshalled from the history of the party are sufficient absolutely to condemn it and I think her argument needs to be answered.
I turn my attention to the minister in question and I shall deal with his argument a little more thoroughly, not because I regard it as being in any manner destructive of the political position which this group holds, but rather because the high position which the minister occupies in this house lends to his argument an authority which a close examination of the subject matter would not warrant. When a minister of the crown is headlined across the country as having wiped out the argument for group government, there are those who may give credence to the announcement. He reminds me of Mzud, who, having got married, went on her honeymoon and elected to go a long sea voyage. She said to herself that she and her husband would act as though they had been for many sea voyages together, but the husband, having noticed a long line of life buoys lashed to the rail, inquired of the skipper why he had taken all these spare tires. The minister posed as a student of political economy and political history; but when w'e come to examine his argument, no matter how well he may have posed, his remarks will spoil the show. I want, however, to congratulate him on his astuteness, for it were better for the Liberal party of this country that the people in general should concentrate their attention upon the alleged dangers of group government than that they should fasten their eyes upon the actual government of the day and the budget which is being discussed at the present time.
I desire also to congratulate him upon his astuteness in another matter. He has discovered that the birth of group organizations constitutes the only formidable challenge that the party system of which he is the protagonist has ever had in this country. I should like to point out to the minister in the terms of Fox that the people of Canada have emerged from the euthanasia of politics; that they have got over their apathy in respect to public matters and that they have given up that acquiescence to things as they are; in short

The Budget-Mr. Irvine

that they have recognized with Disraeli the drollery of the thing called representative government.
I want to confine my remarks to the minister's reference which was a criticism of the United Farmers movement. First of all let me point out that when he charges us, if his statement be regarded on his part as a charge, with believing in group government, I do not know of any single instance when as a group we have proclaimed our belief in group government. I know of no declaration of our annual convention at any time upon which the minister could pin his accusation, if indeed he regards it as being such. In view, however, of our group system of organization, we might regard group government as a fairly logical implication, and if it is, we shall not run away from it. But I merely want to point out that our movement stands for something far more important than group government. The United Farmers movement is an awakening of the people to a sense of personal and collective responsibility in respect to democratic citizenship, and the election of members to this house is only one small phase of that citizenship duty. Deeper and far more fundamental than political action as it is commonly understood, is economic action, and I think that the economic action which has been taken by our movement in the west has been so important and far-reaching in its possibilities, so spectacular in its achievement, as to require no further comment in that regard. We are concerned not less with the social life of our various communities. We are concerned with the securing of that measure of human happiness which alone can make life worth while and which leads us to take an active interest in such matters as education, the health of the people and the moral and social life of the community. Briefly stated, we regard our movement as the means by and through which we shall be able to make our contribution to the building up and developing of an intelligent civilization. There is no democratic action, regardless of the phase of life with which it may be concerned, which is outside of the scope of our movement's interest. That our group may be efficient as a democratic unit in an intelligently organized state, we regard certain things as being of vital importance. These I shall enumerate, and comment upon the most important of them.
First of all, we believe in organization because we do not think that an unorganized people can go anywhere even if they know where they want to go. We believe in organization because a mob can only do one thing, and that is to follow a leader whoever
TMr. Irvine.]
he may be, and the leader as a rule with the most attractive shibboleth and the most money and advertising gets the largest number of votes. We believe that organization is essential, and so we have striven to build up one that is real and alive.
We believe, next, that in order that we may know where we are going it is well to have a little education, and so education is of great importance to our movement in the west.
Next to this comes our principle of cooperation. I notice that some hon. members of this house have indicated by their remarks in this regard that they entertain rather peculiar notions of what cooperation means. I wish I had the time to deal with it as thoroughly as I should like, but I must pass over it speedily with only a few remarks.
We believe in cooperation because we have discovered that competition has become destructive. There was a time, of course, when the competition which to-day has become destructive was the only thing that could be. To-day, however, competition internationally has become so destructive that the nation which wins a war is the one which loses most. Competition has become so destructive in industrial warfare as practically to mean the destruction of the industry concerned, and both organized men and organized capital lose. I refer to one case which has come before this house on several occasions to prove my point- the Besco case. There you had organized capital fighting organized workers,, and they fought with each other until the industry was threatened with destruction, if not actually destroyed. That is what competition does to-day; it has reached the destructive stage. Competition in this house has become destructive. This is a tug of war; this is not a government, and we who are in this corner sometimes grab the coat tails of hon. gentlemen to our right, and sometimes slip across the floor and pull on the coat tails of hon. gentlemen opposite. This is not what I would regard as an intelligent assembly bent on carrying out the business of this country in a cooperative way. If it satisfies hon. gentlemen, I suppose I shall have to take it whether I want it or not, but surely I am permitted to say that it does not satisfy me. Cooperation presupposes a higher common interest than I have ever heard voiced by either party in this house. It presupposes also that the entire civilization of which we form a part should have an intelligent aim. Has our Canadian civilization an intelligent aim? If so, this parliament has not discovered it, for I have not found a pulling of all together towards any common aim. Professor Jacks once gave an illustration which I will use here.

The Budget-Mr. Irvine
He told of looking from a skyscraper hotel down into the streets of Detroit, where he saw a great number of motor cars going north, south, east and west. He realized as he looked down upon them that each one was going some place by itself, but When he took them all together they were not going any place at all. That is a pretty fair picture of our Canadian civilization. We have a great number of groups in this country, despite that hon. gentlemen opposite have not yet recognized that fact. We have organized manufacturers, organized bankers, organized preachers, organized1 farmers, organized bootblacks, and heaven knows how many others we have. Each one of them by itself knows where it is going, or thinks it does, but when we take them all together, can any hon. gentleman tell me where they are going? I say that civilization has to have some intelligent aim so far as Canada is concerned, and that aim cannot be discovered in the spirit of" antagonism and conflict for power which incessantly occupies the attention of this parliament. Cooperation, it is said by hon. members, cannot be practicable because the selfish interests of each group will always force that group to try to gain the masterful position. I want to say that that is a narrow view of the situation. I am not going to deny that selfish interest is there, and that it is the dominating factor, for it is by that selfish interest that we are going to get cooperation.
Let me give another illustration. I want you to think of a mine, a railway company, and a farming community. It is the selfish interest of the mine to get as much wheat for as little coal as possible. It is the selfish interest of the farming community to get as much coal for as little wheat as possible. It is the interest of the railway company to get as much wheat and coal as payment for services, in return for as little hauling as possible. Let us suppose that these three economic groups which we have in our country to-day are fighting amongst themselves and that two of them combine to impose conditions which are insufferable- upon the other. What happens? If they impose on the coal mine, the railway company does not have any coal to supply its power and it has no coal to haul. It cannot, then, haul any wheat either, and the farmer will* freeze to death. So there is a minimum of well being below which no functional group in the community can be allowed to sink without destroying the best interests of all the other groups. So the very selfish interests of each 56103-65$
group is that which I bank upon, if I may be permitted to use that term, to bring about co-operation.
Let me stop here to say that to-day the conflict which exists between parties in this house is the greatest hindrance to the idea of co-operation. It stultifies its very spirit; in fact, it kills it at birth.
Next we believe in the stability of our organization. If we are going to build an organization through which we can function as citizens it will have to become stabilized, and we discovered that the economic interest was the most intimate, the most vital, the most permanent, and the most universal that we could find, and upon that we based our organization. It is because of that very fact that the Alberta organization has withstood the attacks and the shibboleths of the party system for a number of successive elections.
Our next principle is that we invite all other economic groups in the state to do as we are doing-to organize, to equip themselves with the knowledge required for intelligent co-operative effort, to understand the interlocking interests of all, and fix upon some real, intelligent aim for our civilization.
I turn now to deal specifically with our political activities, since they were the centre of the attack by the Minister of Railways. It is only reasonable that a group organized for the purpose of discharging the full duties of citizenship should not neglect its political obligations. What standard of efficiency of citizenship can we expect from people who only mark a ballot once in four years and leave the rest to somebody else? We do not regard that as being a very high ideal of democratic citizenship. But apart from the duty, and apart from the logical course we would have followed anyway, we were forced into this political action by the conditions of the party system. I refer here to the historic sketch given by the hon. member for Southeast Grey (Miss Macphail). The facts which she placed before the house on that subject cannot be gainsaid. Suffice it to say that if the party system had had sufficient virility, had had thatl resiliency or elasticity which belongs to life so that it could have accommodated itself to the changes which over a centruy of industrial development forced upon the country, the story of our movement might have been a very different one. And so if the party system never did any good thing but this one it has served Canada by forcing economic groups into this parliament.
We are opposed, Mr. Speaker, to the party system. We not only do not wish to play
The Budget-Mr. Irvine

the game; we wish to change the game. I will state briefly why we oppose the party system. We' oppose it, first, because of its failure, as I have just indicated, to adapt itself to a new set of conditions which were not apparent at its inception. I must not stop to develop that thought, but I will give an illustration to make my point clear. I want hon. members to think of a farmer who went out to homestead with a team of old grey mares and a set of double harness. After a few years he found himself with four other horses, but he still has the old set of double harness and no new harness for the new horses. So he just lets the four run around to do as they like while he goes ahead ploughing with the two. That is what we are doing in a parliamentary way, but we are not as handy as the farmer: We hitch our horses up tail to tail; he hitches his so that they both pull the same way. To continue the simile, we started with two old nags, and we still have the old set of double harness, which your honour calls " procedure " and other nice terms. But to-day we find we1 have a number of other horses-some may call them mules- and yet we have only the old set of double harness, with the result that these other horses run free without a fraction of responsibility. I realize that it is easy for any member of the government to tell us we have not any responsibility when we suggest certain legislation. But that is not our fault; we are not shirking it; we are' denied it; and yet we are sent here with the same authority that the hon. ministers on the treasury benches enjoy.
We oppose the party system because so far as we can gather its chief aim is to gain power. We regard power as of such infinite importance that no government or p-oup or party has a right to monopolize it; it is dangerous to place it in their hands, no matter how good they may be.
We oppose the party system because the conflict necessary to gain power is disrupting and inimical to the best interests of the state. We oppose the party system because that very conflict is undermining the confidence of the Canadian people in all government whatsoever, and undermining it to the extent that it is paving the way for a bloody revolution as the only means of redress.


Some hon. MEMBERS:: Oh, oh.


William Irvine: My hon. friends opposite
must accept their share of responsibility for that, and before I am through I think they will be glad to do it silently. The party in power put itself in that position, first of all, by an open disregard of the pledges upon which it secured the support of the people.

Think of the clear statements which party leaders make in respect to each other during elections. Last election and the one before what happened? The leader of the one party went out and told the people of Canada that the policy of the other party was rotten, that its leaders were lacking in integrity and that it was unsafe to entrust the affairs of Canada to that party. The other party leader went out and said the same thing. Now, sir, when the Conservative leader speaks the Conservatives believe him; when the Liberal leader speaks the Liberals believe him. I believe them both. Here are the horns of the dilemma. What these hon. gentlemen say at elections times is either true or not true. If it is true-and they are both truthful gentlemen; I am not referring to the present leader of the opposition, for he has not yet had a chance, I am referring to the former leader of the opposition and the one before that- if what those hon. gentlemen have' said is true, then Canada is in a very bad way. And if what the party leaders said of each other is not true, Canada is in a worse way. There is the position in which you have placed intelligent people. It cannot be denied that party propaganda is laying foundations for a bloody revolution, and while party spokesmen charge that to the bolsheviks, I place the responsibility on your own doorstep. You are the men who are developing the revolutionary spirit in this country, if, indeed, there is such a spirit developing.
Now, let me turn to a positive statement of our political principles. First I lay down a political principle which I do not think any hon. gentleman will challenge for one moment. It is this, that the economic interests form the dominating power in political policy anywhere, any time. In this regard let me give the origin of the two parties whose members are now listening to me. The party to my right was a group organization, an economic group. And what was that group? It was the landlords of England struggling to regain some of the influence lost- at the collapse of feudalism who organized a political party called the Tory party to look after their interests in the House of Commons. Those who might perhaps disagree with that statement I refer to a very definite declaration by Trevelyan in his History of the Nineteenth Century. Referring to 1689, he says: " Power was left in the hands of the landed aristocracy, with the municipal oligarchies as its congenial instruments." Shortly after the industrial revolution the rising manufacturing and merchant classes found that they required representatives in the House of Commons, and they organized the

The Budget-Mr. Irvine
Whig party-a group organization. Now you say, "If that is so, why do you object to them?" That is a very fair question. I will tell you why I object. Because after a century of development with interlocking directorates we find that these two groups came together; but when they merged they did not destroy the two old parties, for they discovered they could handle these parties splendidly for their own interests; in other words, they would not put all the eggs in one basket, but a few eggs in each basket. When one party succeeded the other in office the people	thought	that	they had a	realchange of government, but they had not, because the invisible power controlled both parties. I	instance	this	budget, the	lastbudget, the	budget before	that, and all	thebudgets for	the past	sixty	years as the	outstanding proof of that statement, that both parties seem to be controlled either by a masterly influence in that regard, or else this tariff business is a really good policy. This latter the Liberal party denies, but it must be one or the other. I will leave them to answer which of the two it is.
Next, we believe that if this principle I have laid down is sound, then1 the only true national policy that can be hammered out on the anvil of any parliament must come from the direct representatives of all the economic interests of the state, and not by some single group.
Then we believe in making practical the theory of democratic control which is preached by both parties. As a group we do this because we are a workable unit. The party system is not a workable unit. It is too unwieldy, even if it were a stable organization the people lose control of it because of its very size. At this point I would quote what Warbasse has to say in Co-operative Democracy:
The function of a democracy is to protect itself from the wise men who would save it, the fools that would destroy it, the politicians that would betray it; and retain to itself the right of working out its own salvation.
We finance our political movement, and thus control our policy and our members. I claim no particular morality for our method, and I admit it frankly, there is no more morality in it than in the methods of hon. gentlemen opposite. But I am speaking of a different type of organization, and I owe my allegiance to the farmers movement just as hon. gentlemen opposite owe theirs to a party system.
Now, the application of scientific principles to practical government is another thing which we would seek to establish. I cannot
go into the details of that, but I should like to telll the house that the hon. member for Macleod (Mr. Coote) will deal with this subject, perhaps to-morrow or the day following, and I invite hon. members to see what suggestions he has to make in that regard.
As regards the application of this economic principle in practical government, perhaps I might give another illustration to support my argument. Let us suppose two chemists in Ottawa studying the contents of a bottle filled with a particular compound-


Some hon. MEMBERS:: Oh, oh.


William Irvine: Not the kind of stuff you are thinking about. They begin arguing about the actual elements in this compound, and what the result would be if it were applied to the hair of someone's head. One chemist, we shall assume, says the compound is such and such and if you apply it to the head it will remove all the hair; the other chemist says the compound is something very different, and he believes the application of it would cause two hairs to grow where one grew before. And so they argue the point for sixty years; the bottle is still there; and while men's hairs have come and hairs have gone no one knows what the result would be if this remedy were tried. Would anyone dream of calling such men scientists? Yet right in this house we have a state of things similar to this. One of our great political chemists says that the fiscal compound over which the two parties in this country have been arguing for so long will cause prosperity to grow where there was no prosperity before in Canada; the other political chemist affirms the very opposite. Thus they have argued for the past sixty years. But what would genuine chemists do in a case such as I have suggested? They would retire to the laboratory, analyze the compound, element after element, tagging each, and they would put an end to vain argument. Then having arrived at what they considered a sound conclusion, they would look for a dog on which to try this compound; they would make an experiment to see whether the compound would take the hair off the dog or put more hair on it. And so in politics. For sixty years we have argued the question, and there is not a man, woman or child from Halifax to Vancouver who knows what would happen if the tariff policies of the two parties were fully applied. If given a hundred years in which to argue the matter I venture to say that, by this static method, we should be no wiser at the end of that time than we are now. I suggest to my hon. friends that they look for a political dog on which to try their theory to see whether it will work. Let us
The Budget-Mr. Irvine

get down to something decisive and stop arguing, because the argument which has been going on for the last sixty years is certainly not creative; it is not getting us anywhere at all.
I come to the last principle I wish to discuss, the principle of cooperation. We stand for the instituting of cooperation for justice as a substitute for the present party conflict for power. I cannot stop to develop this point because I have something more to say directly to the minister anent his remarks. What I said of cooperation in general a few moments ago will apply in particular to political action. I turn my attention now more directly to the Minister of Railways, taking the order in which he presented his remarks to the house.
In the first place he says that group government is a bad thing because there are groups in Europe. I think the minister went far enough in that connection; indeed he might have been called to order when he termed the leader of the government of Italy a dictator and suggested that other governments in the European countries were not very efficient. I am not, of course, interested in safeguarding the reputation of Mr. Mussolini, nor am I especially interested in any of the governments of Europe. Nevertheless, it seems to me that the minister was not very discreet, to say the least, in his implication. Apart from this, however, the groups of Europe are not analagous to the group I have been discussing to-night; the European groups are hopelessly tied up with the old party idea, just as my hon. friends opposite are. The reason we have trouble in this house is that the government will not recognize we are here. And we are here. One of the first characteristics of a scientific attitude of mind is that it recognizes a fact when it exists, and the existence of this group in this house is an outstanding fact which hon. gentlemen opposite have not yet recognized. That is why the minister has had to roll logs, although I admit that the government has not had any heavy rolling to do this year.
Coming to Europe, let me say that the minister might have found far better examples of the group system if he had been acquainted with the history of the country from which he came. If he is acquainted with that history, as probably he is, then he failed to take note of the groups in the old land. I would refer him to the little group called the Council of London, designated as a group of shopkeepers, who defied both king and parliament and laid the basis of that most popular if nebulous idea of British justice and freedom. I would point
fMr. Irvine.]
to the group that brought a little order out of chaos in the days of Peel; I would point to the Irish group in the House of Commons; I would point to the Labour group in the British parliament-all splendid illustrations which the hon. gentleman might have found had he wanted to look for real examples. But he chose to take Europe because he thinks our people are afraid of Europe. Let me say on behalf of Europe, however, that the governments of France, Germany, Italy and Spain are just as clean, just as democratic and just as efficient as the government of which my hon. friend who spoke is a member.
Let me turn to another point. The hon. gentleman said, "If we allow these economic groups to develop, bless your heart, we do not know where it will end, because we may have a religious group." He was afraid that there might be a Catholic group or a Presbyterian group or a Methodist group. He forgets that the Methodist church is no longer in existence in Canada. However, may I point out to him that there have been religious groups in all parties, and I am not denying them the right, to exist. The clergy of England had a very great deal to do with organizing the party of which my hon. friend is a member-and with the other party as well. I understand also that one of the most potent religious groups in Canada is represented at this moment in my hon. friend's party, and if he considers that group inimical to the best interests of the country I challenge him to throw it out of his party and see what will happen.


Mr. POWER:: What group is that-the
Orangemen?


William Irvine: I am glad my hon. friend
asks that question because I can tell him that there is a religious group in the other party on this side of the house. And these two religious groups have been on the top of every political fight in this country for years. I say, therefore, to the minister that he is not going to hang any religious groups around the neck of the economic group of this country; those religious groups belong to the party system if they belong to any. Let me remind him that our group is not on the defensive; the party system is. The minister therefore will have to do a lot more defending before he goes much further.
And now I come to the last charge; the minister declares that the group system will lead to log-rolling. This is a term from the lexicon of partyism which I confess I do not understand; I do not know what it means. One hon. gentleman suggested to me that it meant, "If you will scratch my back I

The Budget-Mr. Bell (St. Antoine)
will scratch yours." If that is its meaning, I am sure the skin must be off my hon. friend's back by this time. As I say, I do not know what log-rolling means, as used by the minister; but if it means anything bad, evidently he knows what it is, and he does not like it. If the term has reference to the groups in this house, then I will tell him again that it has been necessary for him to practise the art of log-rolling only because the party system has refused to recognize any other method of dealing with honourable men who come here and try to serve the interests of the country as a whole.
Let me conclude by saying this: While I do not expect hon. gentlemen on either side of the house to agree with all I have said to-night, I hope they will go so far as to admit that there is something fundamentally wrong with the system we are practising in this house at the present time, and that if possible they will get together long enough to shade off the most pernicious phases of the party system and give us a chance to work together for Canada. I want to see some great economic principle around which we may all rally in the spirit of co-operation, a principle that will permit us to breathe the spirit of patriotism, a principle that will hold us all by some common appeal, and not this eternal wrangling over nothing and getting nowhere.
Mr. LESLIE G. BELL (St. Antoine): Mr. Speaker, I always enjoy listening to the splendid oratory of the hon. member for Wetaskiwin (Mr. Irvine); at least we will all agree that he is an able advocate of the group system of government. But unfortunately he reminds me also of a great orator whom I heard advocating a third party system of government while I was a student at college in Michigan. I do not know what became of the group he was advocating, but I do know that the two great party system in the United States of America, still exists.
The budget debate is the time when we take stock of the affairs of our country. Hon. members opposite have given this house and the country the impression that we are on the crest of a great wave of prosperity, and it is noteworthy that all speeches made by those hon. members have laid strees on the word "prosperity". The Liberal party have sought to broadcast the fact that the policies they inaugurated are meeting with the favourable endorsation of all classes in this country, and we on this side of the house have been chided about the use of the word "protection". I mention this, for fear my hon. friends on the government benches may think
our party are trying to get away from the word, " protection ", used in its proper sense, but nothing is further from our thoughts. We have been criticized for speaking in any other way than that of boosting the present condition of affairs; members who have ventured even a mild criticism have been chastised by hon. members opposite; we have been accused of being responsible for the migration of hundreds of thousands of Canadians to that great neighbouring country to our south, all because of our criticisms of the present inefficient government, and our belief that the country is not prosperous. We are led to believe that the problems facing the country have been solved at last and that a sure remedy has been found in the free trade-low tariff policy inaugurated by hon. members opposite. We have heard some startling revelations concerning our wonderful financial outlook; we have been told that prosperity is no longer around the corner but that at last she has made her smiling presence known, and our native sons, daughters, and relatives are returning to have a share in that prosperity. The Minister of Finance (Mr. Robb), if not aware of the fact and even though his usual modesty forbids his acknowledging it, must surely consider himself the saviour of his country after the flattering remarks concerning him and which hon. members of the government have showered upon him. The Minister of Railways and Canals (Mr. Dunning) finds Saskatchewan farmers literally rolling in wealth; the Minister of Trade and Commerce (Mr. Malcolm) also sees the golden vision but reluctantly, out of one eye, he also sees a little unemployment, which he calls "seasonal unemployment". The Prime Minister (Mr. Mackenzie King) as Minister of External Affairs, proposes to spend the savings of the budget in Tokyo and Paris, while the Minister of Public Works (Mr. Elliott) stands with the bag wide open ready to accept what remains, to spend it recklessly in public works and other institutions throughout the country, not always in keeping, as we know, with the country's needs.
Accepting the statement of the Minister of Finance in the budget as correct, that our prosperity is definitely assured, I would not hesitate to congratulate the Minister of Finance and the government on such an achievement were it not for the fact that certain figures puzzle my admittedly limited capacity in financial matters. I regret that I cannot see my way clear to join in the voluminous though rather discordant chorus of national prosperity. For instance, I find that although we have heard a good deal of
1032	COMMONS
The Budget-Mr. Bell (St. Antoine)
boasting about the foreign trade of Canada the total imports and exports for the fiscal year 1927 amount to only $2,298,465,647, whereas for the last two years of the Conservative regime the figures were $2,351,186,832 in 1920 and $2,351,187,332 in 1921, or an increase in both these years of about $52,000,000. Again, if my hon. friends opposite would compare the figures relating to foreign trade for the last six years of Conservative government with the past six years of Liberal government they will find that our total exports from 1916 to 1921 inclusive amounted to $7,310,533,075, while from 1922 to 1927 inclusive the figure is $6,435,621,059. Our total imports for 1916 to 1921 inclusive amounted to $5,542,583,300, while for 1922 to 1927 inclusive they amounted to $5,198,804,217. In other words, during the last six years of Conservative rule our favourable balance of exports over imports amount to $1,867,949,775, while under Liberal rule for the last six years the balance was $1,236,816,842, or a matter of $631,132,933 of a more favourable trade balance under the Conservative regime than under Liberal rule. If we look to the net debt of our country we find another strange thing; we see that when the Conservatives went out of power in 1921 the net debt of Canada amounted to only $2,340,878,984, while by the end of 1927 we find the net debt increased by some $7,000,000, the exact figure of the net national debt being $2,347,834,370. The Minister of Finance has sedulously overlooked the fact that the net debt of the country under the Liberal rule, from the time the Conservatives left power, was increased to the maximum amount of $2,453,776,869 in 1923. The debt was increased by $112,897,885 before they started to reduce it, and yet the one outstanding feature of the budget is the boast of the present government that they are reducing the net debt of the country. Furthermore, it must be borne in mind that this present government have collected from the taxpayers of Canada over a billion dollars in war tax revenue alone and as yet they have not succeeded in reducing the net debt of the country by a single dollar, as I have already pointed out.
Then let us consider the tax reductions outlined in the budget. Hon. members of the government point with some pride to the recent reduction in the sales tax; so let us consider that for a moment. A war time government, Conservative or Union as you will, inaugurated a sales tax of one per cent in 1920, increasing it in 1921 to 3 per cent on certain articles. Like most other war governments they were turned out of office after they had made a good job of their herculean task, and
 *
their successors, the present Liberal government, upon assuming office immediately told the people with a smile that they were increasing the sales tax to 6 per cent. This was in 1922. The people accepted this ultimatum; they had no other choice. In the presentation of the 1923 budget, the rate of the sales tax was adjusted to a uniform 6 per cent, with certain exemptions on raw furs, drain tiles for agricultural purposes, and other articles. In 1924 there was a reduction in the sales tax from 6 per cent to 5 per cent, with certain exemptions on text books and certain articles of production. In 1925 more exemptions were added to the list but there were no reductions in the rates. These exemptions included vegetable plants, shoe lasts, and patterns, dies for boots and shoes, fishing boat engines and well-digging machinery. In 1926 there was no reduction in the sales tax. The reductions in that year in income tax were supposed to be most gratifying to the public, and accordingly there were no reductions. In the present budget the sales tax is reduced another 25 per cent, bringing it down to the rate that prevailed when the present government assumed office in 1921. And yet hon. gentlemen opposite tell us that this government is reducing the sales tax, while we on this side are supposed to accept the statement without question.
I have reviewed the reductions which were made in the sales tax from the year 1922 to the present year 1928 and the facts speak for themselves; the present sales tax rate is the same rate as prevailed when they assumed office. On the other hand the Liberal administration meanwhile has been taking a great deal of money, some hundreds of thousands of dollars in fact, from the people every year through this unjustifiable increase of sales tax and burdening the Canadian consumer, with this extra taxation.
Now, looking to the general conditions which prevail in this country, and the claim which is made with respect to prosperity, I would refer hon. gentlemen opposite to the commercial failures which have taken place in Canada during the present government's term of office. When one considers these figures he is astounded. The high water mark for commercial failures took place when this government assumed office. There were 3,925 commercial failures in 1922, the first year the Liberal government took office, whereas in the previous year, 1921, there were only 1,739. The wave of prosperity which has inundated this country during the Liberal administration of six years has drowned some 15,248 branches of business, compared with 7,939 during the last six years of the Conservative regime from

The Budget-Mr. Bell (St. Antoine)
1916 to 1921 inclusive. In 1924 more manufacturers went out of business and double the number of traders succumbed to the great Liberal wave of prosperity ushered in by them in 1922, than under the previous six years of the Conservative administration.
If hon. gentlemen opposite want exact information as to whether business depression or confidence prevails in this country, they should look to the Canada Year Book for 1926. There they will find during every one of the years from 1916 to 1921 inclusive under the heading of "business confidence" the business conducted truly expressed the confidence of the Canadian people. On the other hand if they will look at the succeeding years from 1922 to 1926 inclusive, the latter being the last year given, they will find that business was indicated as being in a depressed state. Only in the year 1926 do we find this is not a fact. This may not appear to hon. gentlemen opposite as a very good barometer for indicating whether or not the country is prosperous at present, but to my mind and sense of reason, when 1827 commercial enterprises covering trade, manufacture, agriculture, logging and fishing, mining, construction, transportation and finance go to the wall, to use the language of the street, a number greater by hundreds than occurred during the previous Conservative regime, and bearing in mind also that there were less in number to go under each year, business conditions at present are not good. However, Providence has been kind to the present government during its term of office. During each year there has been an addition of from 100 to 175 million bushels to the wheat crop. The greatest oat crop in the history of Canada was witnessed in 1922. Likewise, barley had its greatest crop in 1924, and there was the greatest crop of rye in 1922. The enormous amounts realized from these bumper crops should have helped the government a great deal in making business conditions better-and yet, they are worse.
Let us come now to what the government has done for the workingmen of this country. When the present government assumed office it promised that it would do a great deal for the workingmen of Canada. Hon. gentlemen opposite chide us about being the rich man's party. We pride ourselves, however, that we are as strongly for the workingman as we are for the manufacturer or any other class of the community. Four questions naturally arise in discussing what this government has done for the workingmen of Canada. They are these: First, has the present government during its term of office reduced the
cost of living? Has it relieved unemployment? Has it raised the workingman's wages? Has it improved the position of the family circle of the working man during its regime? Hon. gentlemen opposite throughout the country at the beginning of an election campaign always claimed that they were going to reduce the cost of living to the workingman, and it was on the strength of this promise that they received the votes of a great many workingmen. Now let us look at the facts. At the outset, let us again recall, the Liberal Government came into power at the beginning of 1922. I have in my hand the last copy of the Labour Gazette of February 28. I have the budget for a family of five covering the staple foods and the average prices in sixty cities in Canada. Let us compare the figures in 1921, or the beginning of January, 1922, with the prices of foodstuffs in January, 1928: Two pounds of sirloin beef in January, 1922, cost the workingman 54.6 cents. In January, 1928, the cost to the workingman was 62.8 cents. Shoulder beef likewise has risen in price from 30.4 to 36.4. There has been a corresponding increase in veal. So it is all down the list. Lard is dearer, cheese, bread, flour, rolled oats, tea and coffee. Pork and eggs are the only things that are cheaper. I assume that eggs are cheaper because of the importation of eggs from foreign countries, such as China. The total cost per week for a family of five under the present Liberal government is $11.19 compared with the cost when the Conservatives left office of $11.03, so that this government has not succeeded in reducing the cost of living for the workingman. These figures given in the Labour Gazette do not include the cost of clothing, recreation, doctor's or dentist's bills, school fees, or contributions for church purposes.
I might as well, at this very moment, although I intended to do so later on. when dealing with unemployment, refer to the serious conditions that the workingman to-day finds himself trying to meet, in this so-called period of prosperity which our hon. friends opposite would lead us to believe is here. How can the workingman believe in prosperity when he is working to-day, on half pay, in many cases, with many months of unemployment and a family to support, and When very few, if any, workingmen can live on this suppositious budget
Nor has the present government raised the workingman's wages. In 1921, the last year of the Conservative regime, the index number giving the average wages for six trades was 186.1. In 1920 it was 192.1. Under the Liberal regime the workingman's wages have
1034	COMMONS
The Budget-Mr. Bell (St. Antoine)
declined until the index number has new gravitated to 175.9. The index numbers in regard to other lines of employment are as follows:
	1921	1926
	Index	Index
	No.	No.
Common factory labour. . ..	190.6	187.3Miscellaneous factory trades..	202.1	196.7Lumbering wages	202.7	180.8
In 1920, wages in miscellaneous factory trades were at their peak, 216.8 and so were lumbering wages, 202.7. Wages of railway-men are to-day lower than they were in 1921, and wages of the coal miners of Nova Scotia, Alberta and Vancouver island have also dropped considerably. Coal mining labourers underground are to-day receiving from 55 cents to 82.64 less per day's work; millers are receiving $10 per week less in the flour mills, and all hands employed in furniture factories are reciving less per day's or per hour's work as compared with 1921. In the city of Montreal blacksmiths, machinists, iron moulders and sheet metal workers are to-day receiving lower wages than in 1921. That is the condition of the workingman as regards his wages under this prosperity regime of the present government.
Has the present government relieved unemployment? The present position cf unemployment throughout the Dominion is summarized in the February 1928 issue of the Labour Gazette and I am going to read these extracts for the purpose of having them on record. On page 187 of the February issue of the Labour Gazette I find this statement:
The rnost noticeable recessions occurred among Vancouver workmen, 10.7 per cent of whom were idle in November as compared with 14.3 per cent in December, a change of 3.6 per cent, followed by percentage increases m idleness of 2.9 in St. John, 2.7 in both Edmonton and Halifax, 2.4 in Toronto, 2.1 in Winnipeg, 1.7 in Regina, and 1.1 in Montreal, loronto was the only city to record a slight increase in employment over December, 1926, while in all other cities an adverse situation prevailed.
The same Labour Gazette further leports the situation by provinces as follows:
Nova Scotia
During the month of December, 1927, positions offered through employment offices in Nova Scotia were 12 per cent less than in the preceding month and nearly 18 per cent less than during the corresponding month of 1926. Placements declined nearly 10 per cent in comparison with November and 15 per cent when compared with December, 1926.
New Brunswick
There was a decline of over 20 per cent in the number of positions offered through employment offices in New Brunswick during December when compared with the preceding month, and of 25 per cent in comparison with

the corresponding month of 1926. Placements were over 5 per cent less than in November and 16 per cent below December, 1926.
Quebec
The demand for workers as indicated by orders listed at employment offices in the province of Quebec during the month of December declined nearly 50 per cent when compared with the preceding month and nearly 12 per cent in comparison with the corresponding month of 1926. Placements were nearly 41 per cent less than in November and over 8 per cent in excess of December, 1926.
Ontario
During December employment offices in Ontario received orders for nearly 15 per cent less workers than in the preceding month and also in the corresponding month of 1926. There was a decline of nearly 10 per cent in placements when compared with November and over 13 per cent in comparison with December, 1926.
In Manitoba, Saskatchewan, Alberta and British Columbia there are similar reports as to present conditions in connection with unemployment. The Dominion Bureau of Statistics tabulated returns from 6,177 firms showing a decrease in the payrolls from 886,836 persons on December 1, 1927, to 826,736 persons on January 1, 1928, or a decrease of 60,100, or 6.8 per cent. While we are talking about prosperity during the budget debate, this table shows the increase in the number of men unemployed in January of this year as compared with the previous month of December:
More men unemployed in January than in December
Maritime provinces	 1,452
Quebec	 24,672
Ontario	 23,896
Prairie provinces	 3,178
British Columbia	 7,102
As regards the city of Montreal I quote from the Montreal Gazette of February 21, as follows:
Unemployment relief is among the most serious problems which the Financial Federation of the Montreal Council of Social Agencies has to face.	_
At the sixth annual meeting the secretary revealed a deficit of $3,000 for the year 1927 over and above the $6,000 appropriated. In 1928, $6,000 was again appropriated for unemployment relief and after two months have passed, over $4,000 had been expended. The deficit this year will be much greater.
The Minister of Railways and Canals spoke of prosperity and I presume he referred to his own province of Saskatchewan. I read from the Montreal Gazette of March 2, 1928, a portion of a report of the Saskatchewan Farmers' Convention held at Saskatoon on the first of March, as follows:

The Budget-Mr. Bell (St. Antoine)
G-eorge F. Edwards, director of the organization's research department, had this to say: "From statements made by city officials and those that are responsible for distributing relief throughout this province there is no doubt that the rigorous immigration policy engaged in by the Federal government and transportation companies last year has been the cause of a tremendous amount of suffering and hardships to thousands who were brought to Canada through highly-coloured statements and representations."
As regards the unemployment situation in Montreal, let me refer to the Meurling Refuge.
I find that the number of men cared for in that institution in January, 1928, was 17.218 as compared with 9,193 in January, 1927. The Meurling Refuge is a very fine building maintained by the city of Montreal for homeless, destitute men; how homeless and destitute they are can best be gathered when it is realized that these men go in at 6 p.m. and are given two slices of bread and a cup of coffee. They then have to undress and turn in their clothes to be fumigated, after which they line up and pass in to the shower baths. As each man enters, a man ladles out some soft soap which he slaps on the heads of the destitute men and they stay under the shower until the soap has dissolved. They are then handed a towel, after which they are given a night shirt and retire to their beds, from which they are aroused at an early hour, given two more pieces of bread and a cup of coffee and turned out into the streets for another day. The place is well conducted and is considered by many to be the best thing of its kind on the continent, but it will be understood that no man goes there if he can find any possible method of avoiding it.
Nevertheless, an average of 600 men a night made use of the city of Montreal's refuge at a time when the government index figures for employment were the highest on record for the month of January. These figures illustrate better than anything else that the government's fiscal policy is failing to provide for our population. There can be no true prosperity under conditions where over 17,000 free beds for destitute men have to be provided in one place alone.
In another office, on St. James street, Montreal, crowds of ex-soldiers can be seen daily asking for charity provided through a "tag day," and in another, about a stone's throw away, nearly 400 families have received unemployment relief. In Ottawa, right at the door of parliament, the charitable societies are overburdened with the demands upon them for relief by families in distress through unemployment. In Winnipeg the distress
has been so intense that the government has been asked to contribute to relief work, a request which the Prime Minister has refused.
It is not my intention, Mr. Speaker, in speaking of the unemployment situation, in any way to advertise Canada adversely. I think that what is responsible for the number of unemployed at the present time is the policy which this government has persisted in of not allowing Canadian workmen the opportunity to work in Canadian factories, working up Canadian goods, so that Canadian men and Canadian women, wherever they are situated, may buy Canadian goods made by Canadian workmen at home. I hope it will never be the fate of the Conservative party, because it would also be the fate of a great country, to give way to the demands of any party group or of any section and do away with protection. We look across that boundary of 3,000 miles and see over there a country with a population of 120 millions, a country that is applying a quota law in order to prevent immigrants coming in there and enjoying the fruits of prosperity in that country, and yet Canada under the present Liberal government with its low tariff or free trade policy, or whatever you like to call it, cannot induce immigrants to come to this country even from our own British dominions without paying their transportation charges and practically holding out positions for them when they arrive. What is wrong with this government? What is wrong with Canada? There is nothing wrong with Canada. The trouble is with the fiscal policy of this government, and until that has been remedied, conditions in this country will be no better. What is the use of talking about reducing the war debt, or reducing the national debt of this country? This government is accomplishing neither, and at the same time we are losing every day and almost every hour our own stalwart sons and daughters to a foreign land, from which possibly they will never return. Is there any way in which we can remedy these conditions?


An hon. MEMBER:: Change the government.


Mr. BELL (St. Antoine):: Change the government-that seems to be the only way. One would think that the people of the west, whether they belong to the farmers' group or any other group, would realize that until they plant the factory beside the farm there never will be prosperity in this country. I do not know what the farmers want from the Conservative party. The Conservative party have always tried to please the farmers so far
1036	COMMONS
The Budget-Mr. Bell (St. Antoine)
as is humanly possible. Railways have been built under the Conservative regime, although our friends opposite would try to make every one believe that they are the only ones who are building all the railroads in the country. The farmers of the west have got the best wheat lands in the world, and they have rereceived them at the cheapest price. We cannot move the wheat lands closer to the ocean or afford to give them much better transportation facilities, and until there is cooperation between the farmer and the manufacturer, and particularly between the farmer and the labouring men in the factories, there is always going to be trouble in solving the problems of this country.
It amuses me sometimes to hear my hon. friends to my left talk about the consumers and producers in this country. To hear them talk you would think that the farmers were the only consumers. But in what way can the farmer compare as a consumer with the workingman in the factory in our big manufacturing cities? These workingmen are the real consumers. They take the products produced by the farmer, the butter, the cheese, the eggs, and all his other products, and they are willing to pay his price provided they have the money in their pockets with which to buy them. When hon. gentlemen to my left speak of poverty and about the farmers being up against it, let me tell them that I could take them to my own constituency in Montreal and show them conditions which no farmer in western Canada or in eastern Canada has ever experienced. I could show them the condition of families who have not 160 acres of land to live on, who have not their own house over their heads, and worse still, who have not even enough to pay one day's rent. I could show them children and whole families living almost wholly on bread without butter; and yet we hear so much from the Progressives to my left of the conditions under which the farmers of this country are living, as if they were the only ones that legislation should provide for. I am the last to advocate the group system of government but if any class requires remedial legislation the first who should have asked for it and received it is the labouring class, who have not experienced under the Liberal government this prosperity which hon. members opposite are trying to demonstrate. Unfortunately the unemployment situation and the conditions of the workingmen avail them nothing under the present government's policy, and there are no indications that for them, prosperity is here.


Mr. J. L. BROWN (Lisgar):: I shall not
take time to follow at any length the hon. gentleman who has just sat down (Mr. Bell). His concluding remarks, however, indicate that he is badly in need of information in regard to the condition and position of the farmers of this country. He asks, in what respect does the farmer as a consumer differ from the labouring man? He seems to have no conception of the fact that the farmer who is operating a well equipped farm has spent many thousands of dollars upon equipment and expensive material which the labouring man in the city knows nothing of. *


An hon. MEMBER:: And has not the money to buy.


John Livingstone Brown: In reply to the boa. member, I say that the farmer has spent that money; he has not been able to keep it.
I want to refer to an incident that took place in the house this afternoon. The hon. member for North Simcoe (Mr. Boys) produced a couple of hammers. I do not know why he bought them in the first place, and I do not know why he produced them in the house. Let me say that in my judgment I do not think he got the worth of his money when he bought them, certainly not so far as regards the effect that he produced in this house. It seemed to me it fell rather flat. If the hon. member proved anything he simply proved that Mr. Drury was an honest man, who, when he found that the evidence he had in his hand did not support the contentions he was making, refused to use that evidence any further. But the fact that Mr. Drury did not have the evidence at his command is no reason to suppose that his contention was not correct. It would be quite possible to produce evidence in abundance to support the contention which I believe Mr. Drury was making. Indeed on one occasion I travelled down from the west in company with a commercial traveller who was well versed in the hardware business and well acquainted with the sale of tools on both sides of the line. He gave me very clear evidence of t'he great difference that prevails in regard to the price of tools on different sides of the line. I myself for a number of years lived in close proximity to the border, and if there is one class of goods on which there is a large difference between the price in the United States and that in Canada it is small hardware, a sample of which the hon. member produced this afternoon. If you want evidence of that fact all you have to do is to go to Woolworth's stores in this city and you will find they are called, five, ten and fifteen cent stores. I think I am

The Budget-Mr. Brown
probably correct in saying that there is scarcely an article in their stores that is sold for fifteen cents that is not sold in the Woolworth stores on the other side for ten cents. That may seem to be a small thing in itself, but remember it is a difference of fifty per cent. Perhaps some of us will remember an incident in this house some years ago when an hon. member produced a teapot in a very dramatic manner, and for many years afterwards he was known as " teapot Blain." I imagine that the hon. member for North Simcoe will in the future be known as " hammer Boys."
The hon. member also dealt with binder twine. I do not know in whose behalf he was speaking, but I would suggest that he also is in need of further light upon the subject. We have sometimes heard it stated in this house that the truth has been told, but not the whole truth. I do not propose to question the accuracy of the figures submitted by the hon. member, but I do assert that he' did not tell us the whole truth; for in his analysis of the problem he omitted one of the most important factors. When he undertook to establish certain facts in regard to the prices of binder twine in former years and to-day, he omitted one of the most essential factors- the price of the raw material. Oh, I have heard the argument before. My opponent in the last election used it in my hearing on one occasion, but it does not make much impression in the west. He used the argument that has been advanced here to-day, that at a certain time there were so many binder twine factories in Canada that binder twine was put upon the free list, and now we have fewer factories and we are paying a higher price than we did then. It is the old fallacy we have to combat-post hoc, propter hoc; a certain thing has happened, and then when another thing happens it is the result of the first. We meet that fallacy again and again from the other side of the house, but particularly was it in evidence to-day when the hon. member used it in regard to binder twine. True, the price of binder twine is higher to-day, and has been consistently higher during the last few years, than it was for a period of years before. But I say the hon. member failed to take into account a very important factor-the price of the raw material. If he wants to investigate the matter further he will find what is familiar to everybody who knows enough about the matter to discuss it in public, that the price of the raw material is controlled by a New York syndicate in conjunction with Central American governments, the latter controlling the raw supply. That may not in itself account for the entire
increase in the price of binder twine, although to-day binder twine is very much cheaper than it was a few years ago, but not of course down to the price at which it was twenty years ago, perhaps. But that very factor will account in very large measure for the increase in price. It is true, of course, that the general scale of prices has been raised, and that the price of labour is also very much higher than it used to be, but in itself the control of the raw material accounts very largely for the increase in the price of binder twine. I shall not go into the matter further. The hon. member for Selkirk (Mr. Bancroft) my esteemed deskmate, has made a special study of this question and is in possession of information which will be very valuable to this house and which will refute some of the arguments advanced by the hon. member for North Simcoe.
I am Sony that the hon. member for Fron-tenac-Addington (Mr. Edwards) is not in his seat, because there are three things he hates more than everything else, first, the member for Labelle (Mr. Bourassa), secondly, the Minister of Immigration (Mr. Forke), and, third, the United Grain Growers. Well, I should like to tell him that the United Grain Growers Company is the controlling factor in _the price of binder twine on the prairies to-day. It handles binder twine to the amount of nine million pounds yearly, and I think even the enemies of that company in the west will be willing to give credit to it for controlling the price of that very necessary article.
I do not propose to deal with the budget at any great length, Mr. Speaker. I do, however, want to refer to the income tax It was a matter of great regret to me when I heard it announced that the income tax was to be reduced. I have expressed myself on that matter in no uncertain terms in the past, and I have not seen fit to change my mind. I have never been able to work up any great feeling of indignation in regard to what is spoken of as the double tax. In many cases, perhaps not all, the corporation tax can easily be charged to overhead and passed on to the ultimate consumer, in which event there is no reason why the individual recipient of dividends from thel company should not also be taxed. Nor have I any particular sympathy for the young unmarried man who has an exemption of $1,500, and further exemptions if he has dependents, who is required to pay income tax on the balance of his salary. And I cannot work up any particular sympathy for the married couple who have an exemption of $3,000 to $500 for every child under eighteen-
The Budget-Mr. Brown


James Alexander Robb: Twenty-one this year.


John Livingstone Brown: -under twenty-one if they also have to pay income tax on their additional income. Even in the case of men who are most easily reached, the salaried men-and we admit they are the most easily reached-I cannot think they are subjected to any particular hardship. If they have no children and are wasting their time on poodle dogs, there is no particular reason to regard them as objects of sympathy when they have an exemption of S3,000.
I am going to make a statement, Mr Speaker, that I think will probably put me in the class of heretics. We hear a great deal said about tax reduction. Honestly I do not think we can properly look forward to tax reduction, certainly not in the volume of taxation. I know our hon. friends across the way do not seem at times to be able to distinguish between volume and rate of taxation; at least they persistently confuse the two. I think it quite possible that the rate of taxation may be reduced in some cases with -advantage to the revenue, but I do not think this country will ever be able to get along with any less revenue than it has today. I believe we shall require more and more revenue as the years go by. When the committee that is now discussing the pensions of returned men makes its report I am satisfied we shall realize we have only begun to touch the pensions problem. I am quite prepared to believe that as the years go by the amount required for soldiers' pensions will increase by very large proportions. I served on that committee the first session I was in parliament in 1922. It was an amazement to me to find that officers of the pension board, medical men, took the view they sometimes expressed in regard to attributability to service. It seems so perfectly evident to a layman that a man who endured the great stress of war must of necessity have suffered to some extent disability for life that I could not understand the position taken even by medical men. I believe there is a change in point of view; I believe it is coming to be recognized that many of these men, men who perhaps were not wounded, are largely to be classed as among the wastage of war. I have in mind one young man who, when I first knew him, was! strong and vigorous, and who when he came back gave every appearance of being a physical wreck; yet he never had a scratch. In my opinion there are many men in the same condition. It seems to me, therefore, that when we come to consider the question of revenue in relation to pensions we shall find that this reduction of taxation 
is nothing more than a pious wish which we should like to have realized but which we shall find among the impossibilities.
I want now to refer to a suggestion which was made by the hon. member for Peace River (Mr. Kennedy) as to the possibility of forming an alliance with the Conservative party. Such things have not been unknown, Mr. Speaker, when two extreme bodies come together and remain together for a time. Yes, Mr. Speaker, from the time when the Herodians and the Pharisees conspired to destroy the founder of Christianity down to the present time we can find illustrations of extremists coming together to overcome the moderate-minded men. They unite for purposes of destruction, but I wonder whether it would be possible for them to unite for purposes of construction. Let me tell my hon. friends over there that nothing would give the Conservative party greater pleasure than to seduce them into taking the position enunciated by the hon. member for Peace River. It is the one thing I have persistently and consistently tried to warn our farmers against -the temptation to fall for the principle of protection. By and large, the farmer cannot be benefited by a protective tariff. The American farmers have found that out. They succumbed to the temptation to seek higher tariffs and they were under that delusion for years; but they have now begun to find out that it was a delusion-a snare and a delusion. They are therefore seeking relief in such uneconomic measures as the McNary-Haugen bill. I say, nothing would give the Conservative party greater satisfaction than that they should be able to seduce hon. members in the opposite corner into taking the course indicated. I have no doubt that some of them are willing to go. As the hon. member for Marquette (Mr. 'Glen) pointed out this afternoon, there were four of them who in the session of 1926, in the first vote cast in that parliament, gave evidence of a preference for the Conservative party. How many more of them may yet follow I do not know. But what about the lady? Surely they will not forsake the lady member. Her plebeian soul could not stand to be associated with the "snobbish" Conservatives. Surely they cannot forsake her; that would never do. I want Hansard to put that word "snobbish" in quotation marks; otherwise it might give offence to some good Conservatives back home v/ho are my personal friends.
I want now to refer to another item in the tariff, an item upon which some hon. members in the southeast comer have made remarks; I refer to item 267b. Is it not a strange situation to see the hon, member for Rose-

The Budget-Mr. Brown
town (Mr. Evans) and the hon. member for Peace River associated with the Imperial Oil Company in opposition to this particular item? Yet such is the case. But perhaps on second thought it is not so strange; perhaps this is the first step in the direction of that alliance which has been suggested. Who knows? I wish to quote in this connection the hon. member for Rosetown:
Again, under item 167b I find a most amazing thing, the full import of which is not readily discerned. As far as I can see, the government has given notice to all small oil refining companies, and to those contemplating entering the business, to get out and stay out.
I will not quote the hon. member for Peace River in this regard; his remarks were made a day or two ago and they are somewhat lengthy. What he said was part of the general argument in relation to finished products and raw materials. But his position is there stated. Now what is the reason for this change? I have taken some trouble to look into the matter. I find that an application was made to the tariff board by a representative of one of the small oil companies to bring about the change. The situation, as I understand it, is something like this-I will try to give a picture of it. The large oil companies, with their expensive equipment and a good market for the by-products, are able to use the absolutely crude petroleum, while the smaller companies, without that equipment and with a more limited market for their by-products, cannot use such petroleum to advantage. The base of their operations lies in a product which has already passed through one process in refining, the technical term for which I believe is oil tops This particular product has been coming in under a duty of three-tenths of one cent per gallon under the British preference, fourth-tenths	of	one cent	under	the	intermediatetariff, and a half cent under the general. I am informed that in the actual application of the Customs Act they have been paying the same duty as on the finished product, so that instead of this being what the hon. member has depicted it, a notice to the small oil companies	to	"get out	and stay	out." It isabsolutely the reverse. Again, let me express the keen	regret I feel at	seeing the hon.
member for Rosetown associated with the Imperial Oil Company, which I understand has put in a protest recently against this item.


Richard Bedford Bennett: Not against the item but against the wording.


John Livingstone Brown: It is only an indication of the need for more complete information in regard	to	the many	items	in	this budget,
which information we shall no doubt receive
when we are in committee. I am told that the analysis made by the hon. member for Peace River of some of the other items is no more accurate than in the case of this particular one, 267b.
Now just a word in regard to group government or the balance of power theory. These two terms may be synonymous or they may be antagonistic to each other; I do not pretend to know. However, I will discuss the question under the head of the balance of power theory. I am willing to pursue inquiry into the question how far independent members may be given freedom of expression as to when a government should consider itself defeated and when not. This theory of that balance of power seems illogical to me because it cannot be universally applied. It may be very well for one or two to occupy that position and sit on the fence, but everyone cannot do it; some people must assume responsibility. The theory is absurd; and I do not use that term in an offensive way b.ut rather as Euclid used it. when, in pursuing certain lines of reasoning, he arrived at a conclusion which did violence to the axioms he laid down. In such cases the conclusion was absurd, and I use the same term with reference to this particular theory. It is absurd because, in order to make it effective at all, it pre-supposes the existence of two major parties both of which are abhorrent to these who have adopted the theory. I do not want to use any such rough term as bludgeoning, but it does seem to me absurd to think this could be adopted as a permanent principle under which to carry on government, although it might meet a temporary situation. I call to mind a little rhyme we used to say when we were children, which went something like this:
The lion and the unicorn,
Fighting for the crown;
Up jumped a little dog
And knocked them all down.
Who represents the lion and who the unicorn I do not presume to say, but I do know who wishes to take the part of the little dog.
Our friends tell us that the session of 1926 was an ideal session, just what they wanted. Well, Mr. Speaker, I am not usually averse to a scrap, but I do not think either this house or the country would consider the session of 1926 to be ideal. It was not ideal to see hon. members opposite at that time; I can scarcely describe their condition. A lioness robbed of her whelps is not to be compared with the attitude of mind exhibited by hon. gentlemen opposite, and I even believe the hon. members with whom I was more intimately associated at that time will not say that the
The Budget-Mr. Brown

conditions within our own ranks were so absolutely ideal that we would have liked to have them remain that way.


Agnes Campbell Macphail: They are now.


John Livingstone Brown: And so are ours, for that
matter. Now they tell us we had a splendid program of legislation that year. Did we? It is true that we had a perfectly honourable arrangement with regard to a legislative program, an arrangement that was well known to the country, and we advanced that legislation to certain stages but we did not get it through. What was the reason? Well, Mr. Speaker, it is well known that when we all voted with the government there was a majority of twelve; when the five members who expressed a Conservative preference in the first vote opposed the government that majority was reduced to two. In addition to that there were always one or two on the ragged edge, so when the test vote came on the amendment moved by the hon. member for Winnipeg North Centre (Mr. Woodsworth) to the amendment of the hon. member for Vancouver Centre (Mr. Stevens) to the customs report, what was the position? We lost two more votes.
I have no criticism to offer as against the hon. gentlemen who saw fit to take that position. They may have been right or wrong; I am willing to admit that it was a question in which great moral issues were involved, and I am willing to concede that it was a question on which men governed by a high standard of morality might have taken one or the other of two positions. I am quite willing to concede all that, but the fact remains that because these members took that postion we did not get the legislation we desired. But our friends say we got the legislation in 1927. That is true, but we had to run the gauntlet of a general election first, and you are never sure what the result of an election may be. If it had not been for the absolutely stupid tactics of our friends opposite from the time that session opened until it closed they might have been occupying seats on this side of the house and then what would have become of the legislation? I think it hardly safe to count on their following along the same lines. Of course hon. gentlemen opposite may be able to learn; they have reorganized their board of strategy and they may do better than they did before, but it is not a safe thing to bank on. So I say we did not get the legislation in that particular session, and I want to say also that if this much-reviled little group had taken the same position on the budget last year we would not have had the legislation yet; last session would have been as barren as the previous one.

Now, I am told that my time is going very rapidly.


An hon. MEMBER:: Go on.


John Livingstone Brown: That would be all very
well, if I only could. However, I want to suggest to our friends that perhaps they have not looked into this problem in all its aspects. I know they have given a great deal of consideration. to government in its legislative aspects, but I have never yet heard a single suggestion from those advocating group government as to how an executive is to be formed. Mr. Henry Wood has not told us, and from none of his followers have I heard how they propose to form an executive to carry on the functions of government. If they 'have any ideas on this phase of the question the general public have not been given the benefit of their deliberations. To quote the Ottawa Citizen, however, while the Liberal-Progressive may not be "the last word in political intelligence", at least they have given some thought to this problem. I came across a little book in the library the other day, from which I propose to read a few extracts. I do not say that I agree with this in every respect but it will at least be interesting to hon. members opposite. This little book is one of a series of Chronicles, of Canada, dealing with the winning of popular government in Canada. It deals with the few years immediately following the rebellion of 1837, after Lord Durham had made out his report and Mr. Poulett Thomson, afterwards Lord Sydenham, was sent out to Canada to try to put into effect the principles which Lord Durham had recommended. He speaks of his visit to Lower Canada, where he found no government at all, and then he proceeded to Upper Canada, and at this point I quote:
At Toronto Thomson found a totally different set of conditions. Here was a constitution functioning and a legislature in session; but what a legislature! Split into half a dozen little cliques and factions, it was trying to work with no cabinet, no opposition, no party system-an ideal state of things to which some critics of present conditions would like to return.
In the same connection I read another extract; an election was held, and the result was as follows:
The results were known early in April. They were as follows: For the government, twenty-four members; French, twenty; Moderate Reformers, twenty; Ultra-Reformers, five; Compact party, five; doubtful, seven. The curse of petty faction was not lifted, nor the machinery of two-party government really installed, for it was quite possible for several of these groups to combine in voting down government measures without having sufficient cohesion among themselves to form a ministry and assume control.

The Budget-Mr. Brown
Then we have another sentence further:
Mankind has a pathetic faith in the efficacy of political machinery, remade or remodelled, to grind out happiness and bring in the age of gold.
But in order to show that I hold the balance evenly, I am going to give another extract to which perhaps those charged with the responsibilities of government might give heed:
Parliamentary procedure, as they have it in England, was a new thing in Canada. In Great Britain the government does not always resign when defeated on a vote, nor does the opposition defeat the government when it has no power to form an alternative government.
One more quotation. I give this for the benefit of the hon. member for Vegreville (Mr. Luchkovich)-I am sorry he is not in his place. He delivered an address the other day which was well worth listening to. It is true it had the character or quality of an essay, but seeing that the hon. member's native tongue is not English, he is to be congratulated upon his facility of expression in the English language. The passage I am going to read is not pertinent to the subject under discussion, but I will read it for one reason:
Complete freedom to manage its own affairs should, if logic were strictly followed, separate the colony from the mother country; but the British genius for compromise has met the difficulty in a thoroughly British way by avoiding any precise and rigid definition of the relations existing between the mother country and the daughter state.
This is a little apart from the subject, but I have always felt that our greatest danger lies in attempts at too exact definition. I want to refer to what is spoken of here as "the British genius for compromise". The hon. member for Vegreville read us a lecture on compromise. There should be a distinction between compromise on moral grounds and compromise on questions which are, after all, matters of expediency. When moral issues are involved a man must say: Here I take my stand, I take none else. But the great majority of the questions that we have to consider do not come within that category. They are matters on which there may very well be an honest difference of opinion between men equally anxious to reach a solution of our problems. I have no hesitation in saying that the essence of democratic government is compromise. If there is no willingness to compromise then we find ourselves between autocracy on the one hand and anarchy on the other. If we are going to carry on democratic government there must be a willingness to compromise. That does not mean the renunciation of any great moral principles to which a man commits himself.
There are other things I should like to have said but I find I shall have to refrain from doing so on the present occasion. I wish, however, to conclude with a reference to our position in this parliament. The hon. member for Marquette used words that I heartily endorse, that we should be moved neither by taunts nor by recrimination. We are charged with having forsaken our principles. Hon. members will remember that there is a difference between principles and methods that are employed to give effect to these principles. We may honestly admit that at one time we had in view the formation of a great party that would express our views. But when we talked of that, we got no help whatever from the members representing the United Farmers of Alberta, and absolutely none from the hon. member for Southeast Grey (Miss Macphail). I am simply stating facts. They may have been right, we may have been wrong, but I am simply stating the facts. There was another breach in the third session of the last parliament when the "Ginger" group broke away and did not come to our meetings. When I got home, I was told: We sent you fellows down there to work together. I never was reproached for not joining the ginger group, but it was charged against me that we were not able to preserve unity.
I said, Mr. Speaker, that there should be a distinction between principles and the methods that are employed to give effect to these principles. We have taken our position here. W7e are each one of us responsible to our constituents. I have no indication up to the present that I have not been expressing the will of the men who sent me here. I believe the hon. members associated with me are, like myself, anxious to express not only their own views but are anxious to do what their people would like them to do. Happily so far we have been able to make these two duties coincide. Again I say, Mr. Speaker, that though there may have been a choice of different means, there is no forsaking of principles.
I am going to close with a somewhat homely illustration. Just before I came away from home I had to sell some pigs. I had them in a pen sixteen feet square. It was not arranged so that I could run them through a chute into my sleigh, so I had to take another method. I got a rope and my method was to try to get a noose round the head of the pig and then a half-hitch round the body. When you have got a pig hitched that way you have got a real hitch. I had a man helping me who was not as experienced as I was, and when I got the noose over the

1042	COMMONS
C.N.R.-Railways and Shipping Committee
head of the pig he began to pull. The result was that the pig got the rope off his head, but by a little' judicious manoeuvring and scratching the pig I managed to get the rope round his body. Mr. Speaker, we are scratching the pig. There may be one or two stubborn ones that we may have to knock down with a club, but I think we have the majority off them pretty well under control.
On motion of Mr. Barber the debate was adjourned.
On motion of Mr. Lapointe the house adjourned at 10.40 p.m.
Tuesday, March 6, 1928