1929-03-14

[Stage Direction]
,	FIRST READINGS
Bill No. 77, respecting the British Colonial Fire Insurance Company and to change its name to British Colonial Assurance.-Mr. Mercier (Laurier-Outremont).

Bill No. 78, respecting a certain patent of Zebulum Colvin Ketchum.-Mr. Jacobs.
Bill No. 79, respecting a certain patent of Jean Baptiste Hurteau.-Mr. Duff.

Mr. J. F. POULIOT (Temiscouata):: Mr. Speaker, may I be permitted to rise to a question of privilege? My attention has been drawn to a paragraph in an article headed "Glimpses of Parliament", in the Ottawa Citizen of March 12, which reads as follows:
For once, Mr. Pouliot, the Liberal member for Temiscouata, laid off Premier Taschereau, his particular bete noire.
May I say, Mr. Speaker, to quote St Augustine, I d'o not desire the death of a sinner but only his conversion. I only wish at times to correct some erroneous statements that come from .the premier of Quebec.
May I say, Mr. 'Speaker, that the correspondent of the Citizen was mistaken, because in the speech that was delivered in this house on March 11, there is the following:
Some years ago at a banquet tendered to Hon. Senator Belaud, a badly informed politician propounded this question: "How is it that in Quebec American potatoes are served on the table?"
May I say, Mr. Speaker, that it is always impolite and very bad manners for a guest to criticize .the menu? But that transgression was made by Mr. Taschereau himself, and as his name was not mentioned, his reference to American potatoes was perhaps lost amongst the millions of hundredweights of Canadian potatoes that were referred to in my speech.



PRIVILEGE-MR. BLATCHFORD

Mr. K. A. BLATCHFORD (Edmonton East):: Mr. Speaker, I would like to draw the attention of hon. members to an advertisement that appeared in last night's Journal in connection with certain mining stock that is being placed on the market. It is signed by a gentleman by the name of Richard A. McClymont, Investment Counsel, whatever that may be. In the advertisement he twice referred to me as recommending this stock to the hon. members of this house, to my friends, and to the general public.
I wish, Mr. Speaker, to point out, that I am not a mining broker, not a stock salesman, nor am I recommending any line of mining stock to any one. I have never met this gentleman up to the present moment. The only recollection I have of Mr. McClymont is when be grew famous overnight through his letters in the press a year ago in connection *with the civil service. I believe a recommend-

Business of the Howe
ation from a man like Mr. MeClymont would black the eye of any mining company, and would absolutely ruin the reputation of any member of this house, and I hope the Ottawa Journal will see its way clear to correct this impression.



REPORTS OF COMMITTEES

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The fifth report of the select standing committee on railways, canals and telegraph lines. -Mr. Cahill.
The third report of the select standing committee on agriculture and colonization.-Mr. Kay.


Right Hon. W. L. MACKENZIE KING (Prime Minister):: This will probably be the
proper time, Mr. Speaker, for me to move the resolution standing in my name, as follows :
That when the house adjourns on Friday, the 22nd of March, instant, it stand adjourned until Tuesday, the 2nd of April, next.
I mentioned yesterday that I would ask the chief whip to see the other whips of the house and ascertain if it was possible to come to some agreement that would suit the convenience of all. That was a pretty large order, but I am told by the chief whip that if this; resolution were amended to read:	That the
house stand adjourned until the 4th of April instead of 2nd of April, he is of the opinion, from the conversations he has had, that the resolution would meet with general acceptance. Having that in mind, I would ask the house to permit me to amend the resolution by changing the date from the 2nd of April to the 4th of April. The resolution would then read:
That when the house adjourns on Friday, the 22nd of March, instant, it stand adjourned until Thursday, the 4th of April, next.


The SPEAKER:: Is it the pleasure of the
house that the right hon. gentleman may have leave to amend his motion?


Hon. R. B. BENNETT (Leader of the Opposition):: Before the motion carries, Mr. Speaker, I desire to observe that it was the consensus of opinion of those who sit to the left of the Speaker that we should have as short an adjournment as possible having regard to the late date at which the house convened, but apparently the chief whip of the government has concluded that what is now suggested best serves the interests of all. I have only to say that if a shorter adjournment were made it would be acceptable to those who sit to the left of the Speaker, but it appears to be important that
the recess should begin on the 22nd, because of certain arrangements which some of the hon. members have made.


[Stage Direction]
Motion agreed to.

William Lyon Mackenzie King: Mr. Speaker, I have a further motion that may help to expedite the business of the house when we return. My hon. fciend will I am sure agree that since the house opened remarkable progress has been made with the work of the session, and I see no reason why when we resume we should not make even better progress after a brief respite. I move:
That on and after Monday, 8th April next and all subsequent Mondays and Wednesdays until the end of the session, government notices of motions and government orders shall have precedence over all other business except questions and notices of motions for the production of papers.
In connection with that resolution I might point out that last year eight days in all were occupied in discussion of private members' motions. This year up to the present time, private members have had eleven days, so that no one will have cause to feel that this motion will deprive anyone of his rights.


Richard Bedford Bennett: Mr. Speaker, I apprehend that
the Prime Minister is content that this should stand as a notice of motion.


William Lyon Mackenzie King: Yes.
Motion stands.



AGRICULTURE AND COLONIZATION

Mr. W. F. KAY (Brome-Missisquoi):: Mr. Speaker, if I may have the unanimous consent of the house I will move, seconded by Mr. Sinclair (Queens):
That the third report of the committee on agriculture and colonization be concurred in.


Richard Bedford Bennett: This might stand as a notice
of motion, Mr. Speaker.


Hewitt Bostock: Stands as a notice of
motion.



QUESTIONS

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(Questions answered orally are indicated by an asterisk.)

Mr. EDWARDS (South Waterloo):: 1.	What was the value of Australian woo! imported into Canada for the fiscal years 1926, 1927 and 1928?
2.	What quantity in pounds was imported during the same years?
Questions


Mr. MALCOLM:: 1. Value of wool	imported into Canada
horn Australia, years	ended March 31, 1926,
927 and 1928:	
	Dollars
1926		
1927		
1928.. ..	
2. Quantity of wool imported into Canada from Australia, years ended March 31, 1926, 1927 and 1928:
Pounds
1926		 728,030
1927		 676,244
1928		 320,324


NOVA SCOTIA-INCREASED SUBSIDY
Mr. CANTLEY:: 1.	How much of the interim lump sum increase of $875,000 recommended to be paid the province of Nova Scotia by the Royal Commission on Maritime Claims has been paid up to December 31, 1928?
2.	On what dates were the several payments made and what amount on each date?
3.	Have any deductions from said payments of $875,000 yearly been made?
4.	If deductions were made, what was the amount of such deductions and when were they so made?
5.	On what authority were any such deductions made from the amounts so recommended to be paid?


Mr. ROBB:: 1.	$1,750,000.
2.	June 30, 1927, $437,500; November 17. 1927, $437,500; July 3, 1928, $437,500; September 20, 1928, $437,500.
3.	4 and 5. It was decided to pay this special grant half-yearly with the regular subsidies on the 1st January and 1st July in each year. The special grant was first paid with the regular subsidy due July 1, 1927, when the two payments were made, less a deduction of $133,116.73, being reimbursement of expenditure for troops sent to Cape Breton on strike duty, under subsection 2 of section 84 of the Militia Act, which reads as follows:
"His Majesty may retain from any annual grant payable by Canada to such province and under the control of the parliament of Canada, any unpaid balance of moneys due to His Majesty by such province under the provisions of this section."
The second instalment of the special grant which was to have been paid on January 1 has, in each year, been paid earlier to accommodate the provincial government.


BLOOD INDIAN RESERVE
Mr. COOTE:: 1.	How much land on the Blood Indian reserve is in possession of the Indians for farming purposes?
2.	How much land is now under cultivation?
3.	How much land will be cropped in the year 1929?
4.	How much seed wheat have the Blood Indians on hand for this purpose?
5.	Is the amount of wheat on hand considered sufficient to sow all the land available in 1929?
6.	Will the department advance seed grain to all Indians who prepared land for crop for the year 1929 ?


Mr. STEWART (Edmonton):: 1.	197,207 acres.
2.	(a) 7,813 acres cropped; (b) 942 acres broken; (c) 4,160 acres summer fallowed.
3.	In addition to spring ploughing department estimates 5,552 acres will be cropped.
4.	9,900 bushels.
5.	Additional 1,200 bushels may be required for spring ploughing.
6.	Yes.


WORSTED YARN IMPORTS-1926-28
Mr. EDWARDS (Waterloo):: 1.	How many pounds of worsted yarn were imported into Canada during each of the years 1926, 1927, and 1928, from Great Britain?
2.	How many pounds of worsted yarn were imported into Canada during the above-mentioned years from other countries, and what amount from each?


Mr. MALCOLM:: 1.	Quantity of woollen and worsted yarns imported into Canada from the United Kingdom, years ended December 31, 1926, 1927 and 1928:
Years	Pounds
1926			 3,235,007
1927			 3,554,224
1928			 4,775,493
2. Quantity of woollen and worsted yarns imported into Canada from other countries, years ended December 31, 1926, 1927 and 1928:
1926	1927	1928Countries	Pounds	Pounds	PoundsBelgium	27,920	23,870	17,071France	108,320	152,078	129,200Germany	362	917	1,211Greece	18	85Netherlands. ..	250	Turkey	169United States..	23,786	28,803	2,648
Note:-Impossible to segregate imports of worsted yams from other woollen yams. During the years ended December 31, 1926 and

Postmaster at Simcoe
1927 the quantity of worsted yarns exported from the United Kingdom to Canada was:
Years	Pounds
1926		 1,667,500
1927		 1,680,985
BEAUHARNOIS I.IGHT, HEAT & POWER CO.


Mr. CHURCH:: Who are the directors, chief officers, shareholders and bond holders of the Beauharnois Light, Heat and Power Company, to whom the Government issued a permit under the Navigable Waters Protection Act?


Mr. ELLIOTT:: No information. Company is under provincial incorporation.


BOUNTY ON COKING COAL
Mr. CANTLEY:: How much money was paid by the Dominion by way of bounty on Canadian coal used in the production of coke in coke ovens situate in Halifax, Montreal, Quebec, Toronto, Hamilton, or in any other Canadian coke oven plants, during the year 1928?


Mr. STEWART (Edmonton):: No payments made during the fiscal year 1928-29.


B.C. LUMBER-SHIPPING SERVICE TO AUSTRALIA
Mr. NEILL:: 1.	Have representations been made to the government on behalf of the lumber interests of British Columbia, urging the necessity of inaugurating or encouraging a steamship service to Australia of boats suitable for carrying lumber, to endeavour to secure a better share of the Australian lumber market than we now possess?
2.	What action is contemplated by the government?


Mr. MALCOLM:: 1.	Yes.
2.	The matter is now receiving the consideration of the government.


SHERBROOKE FARMERS
Mr. HOWARD:: 1.	Has the attention of the government been called to the serious situation of farmers in the county of Sherbrooke, whose herds have just been tested and a large percentage of their animals gone down under the test?
2.	Will anything be done immediately to supply these farmers with money to enable them to purchase new stock rather than abandon their farms?	_
3.	As money for this is not available until after the estimates are voted, can anything be done in the meantime?


Mr. MOTHERWELL:: 1.	Yes, to some extent.
2.	The department regrets it is not in a position to pay any compensation due for cattle condemned under the restricted area policy as its funds for this purpose are exhausted.
3.	No. Nothing but wait patiently.


CANADIAN NATIONAL RAILWAYS-PASSES
Mr. GOTT:: 1.	How many annual or trip passes were issued by the Canadian National Railways and the Department of Railways and Canals to other than employees of the Canadian National Railways, other railways, senators, members of the House of Commons and their families, during the year 1928?
2.	To whom were passes issued?
3.	What was the occupation of those to whom passes were issued?


Mr. GOTT:: Dropped.


POSTMASTER AT SIMCOE
[Stage Direction]
On the orders of the day:
Mr. H. A. STEWART (Leeds):: Mr. Speaker, I should like to draw the attention of the Postmaster General (Mr. Veniot) to the return which was placed on the table recently in connection with the dismissal of Mr. Whittaker, postmaster at Simcoe. This return does not appear to be complete. Will the Postmaster General have any objection to placing the original file on the table?


Hon. P. J. VENIOT (Postmaster General):: I may say, Mr. Speaker, that I gave orders for all the original file of correspondence to be placed on the table. If it is not complete, I will look into the matter.


Hugh Alexander Stewart: I am not saying that all the correspondence is not in the return; but all the relevant documents are not included.


Peter John Veniot: I do not think any official of the department would take off the file any documents that should be laid on the table of the house.


Hugh Alexander Stewart: May I assume that the Postmaster General has no objection to laying the file on the table? That is what I want to know. .


Peter John Veniot: The original file is on the table.


LOWER DETROIT RIVER LIGHTS AND BUOYS
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On the orders of the day:
Eccles James Gott: Mr. Speaker, yesterday I apprised the Minister
Soldier Settlement

of Finance (Mr. Robb) that to-day I proposed to make an inquiry of the Minister of Marine and Fisheries (Mr. Cardin). In his absence I should like to get some information from the acting minister as to the contract for lights and buoys in the lower Detroit river for 1929. Has the contract been made? If not, will the minister instruct that this be done as formerly by calling for tenders?


Hon. J. A. ROBB (Minister of Finance):: Mr. Speaker, on behalf of the Minister of Marine and Fisheries and in his absence, I beg to give the house the following memorandum which I have received from his department:
The contract for the maintenance of the lights and buoys in the lower Detroit river entered into in March, 1926, for a period of three years, expires at the end of March, 1929. The said contract was a renewal of a previous contract concluded in 1923. Having regard to the importance of the service and to the satisfactory manner in which the work has been carried out by the present contractor since 1920. and also to the reasonableness of the price which was established by public tender, the Department of Marine and Fisheries has recommended a renewal of the present contract at the rate established by tender. The contract, however, has not yet been renewed.


POSTMASTER AT KITCHENER
[Stage Direction]
On the orders of the day:
Hon. HUGH GUTH'RIE (South Wellington) :	Mr. Speaker, might I ask the Postmaster General (Mr. Veniot) if he will be good enough to lay on the table all papers in connection with the recent dismissal of the postmaster at the city of Kitchener?
Peter John Veniot: I have no papers, Mr. Speaker, in connection with the dismissal of the postmaster at Kitchener.


Mr. GUTHRIE:: Might I ask if he has
been dismissed?


Peter John Veniot: He has not. His case is
being considered. Perhaps that is enough for the present.	.


BOARD OF GRAIN COMMISSIONERS- HYBRID GRAIN TICKET
[Stage Direction]
On the orders of the day:
Mr. E. J. GARLAND (Bow River):: Mr. Speaker, could the Minister of Trade and Commerce (Mr. Malcolm) give the house any idea when the return asked for on the 20th of last month with regard to correspondence between the board of grain commissioners and his department will be laid on the table?


James Malcolm: I may advise my
hon. friend from Bow River (Mr. Garland) that this correspondence was laid on the table to-day.


Edward Joseph Garland: Thank you.


THE THUNDERER
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On the orders of the day:
Mr. 0. L. BOULANGER (Bellechasse): Mr. Speaker, I desire to ask the Postmaster General if in view of the desirability of preserving a good understanding between people of different religious beliefs in this country, he does not propose to bar from the mails a sheet called The Thunderer, published in the city of Toronto?
Peter John Veniot: My attention has been called to such a sheet, but before coming to any decision as to barring it from the mails, I should like the legal officials of the department to have an opportunity to examine it and see whether it should come under the ban or not. The matter will be looked into.


SOLDIER SETTLEMENT IN BRITISH COLUMBIA
[Stage Direction]
On the orders of the day:
Hon. ROBERT FORKE (Minister of Immigration):: Mr. Speaker, on Monday last
the hon. member for Eraser Valley (Mr. Barber) drew my attention to what he termed a serious state of affairs which appears to exist among the soldier settlers in a certain section of British Columbia. He read an extract from one of the leading Vancouver papers, headed:
Say soldier settlers are starving here.
Instead of repeating the article perhaps it will serve the purpose if I read to the house the following statement. I immediately wired the superintendent at Vancouver in regard1 to this matter and I shall now read his wire in reply:
Reference your wire date extract from newspaper apparently refers question of milk assignments brought up at annual meeting Fraser Vallejo Milk Producers Association held last week (Stop) Some settlers wish set aside assignments and press report indicates committee to be appointed interview board regarding matter (Stop) Interview not yet requested (Stop) Statement that settlers are starving gross exaggeration (Stop) Have always followed policy of refunding monthly milk payments where settlers circumstances appeared demand it (Stop) Agitation originated from few settlers evidently anxious sidestep obligations to board (Stop) Possibly also result of dissatisfaction because some settlers evading

The Budget-Mr. Bothwell
assignments by shipping in wifes name (Stop) Same question raised at meeting of association last year and explanations to president apparently satisfactory as matter dropped.


THE BUDGET
[Stage Direction]
The house resumed from Wednesday, March 13, 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, and the proposed amendment thereto of Hon. Hugh Guthrie.
Mr. C. E. BOTHWELL (Swift Current):: Just before the house closed yesterday evening, two or three questions were asked from the other side, particularly by the bon. member for Skeena (Mr. Brady) and the hon. member for Lincoln (Mr. Chaplin). In reply to the hon. member for Skeena, I wish to inform the house that the statistics I gave yesterday were from the summary of the trade of Canada for January 1929 and for the twelve months ended January, 1928 and January 1929. The question was as to what proportion of our Canadian export trade consisted of wheat. In reply to that question, I may inform the hon. member that the proportion amounts to about 32 per cent. The question was also asked as to whether fish and furs were included or should be included with animals and animal products, and in answer to the hon. member for Lincoln I said that I did not consider these articles as coming under that heading; but even excluding them, the figures I gave still hold good. I want now to inform the hon. member further that from the exports enumerated yesterday we can eliminate not onty fish and furs but also beverages, tobaccos, rubber and rubber goods, fruits and vegetables and still the proportion of the export trade of Canada, made hp of agricultural and vegetable products and animals and animal products, is over 50 per cent. With regard to those items that are excluded, I cannot possibly see how industry in Canada could be benefited by the placing of a duty on fish and furs, for instance, the two items referred to by the hon. member. In that connection it might also be of interest to the house to note, from the preliminary report of the trade of Canada for [DOT]1928, that our percentage of exports of raw material, excluding grains, fresh fruits and vegetables, seed and raw tobacco, has steadily declined. In 1900 the percentage was 28.8 per cent and in 1927 it was only 12.4. Our export of raw material has been steadily going down, whereas in the same report you will find that the American percentage has increased.


Richard Bedford Bennett: Would the hon. gentleman think I was trespassing on his time if I asked a question? Does he realize that in that report we classify as raw material what in other quarters is classified as manufactured material? Take blister copper, for instance; we treat it as an export of manufactured or partly manufactured products, instead of its being classed as raw material.


Charles Edward Bothwell: TheTe may be something in what the leader of the opposition says. However, on that particular page of the -report, which came to me only this morning-page 15-the export trade of Canada in raw materials is compared with that of the United States. Now, following what I said yesterday, I have lo-oked over th-e trade of Canada, with particular reference to the imports dealt with by the hon. member for Fort William (Mr. Manion), and I find that among the imports into Canada for consumption the largest single item, upon which the opposition apparently believe there should be an inorease in the tariff, is that of iron and its products, amounting to $330,953,152. I took occasion to ascertain what th-e production of Canada was of iron and its products, and I also looked up -the report to see what our exports were. As I say, we import $330,953,152 and export $73,070,054 of the same class of products, leaving a net import of $256,883,098. Our production in Canada, according to the report for -the year 1927, the latest report I -could obtain-and for 1928 I believe it will be considerably higher, judging from the newspaper reports-was $525,921,839, making a total consumption of $782,804,937. The proportion of imports amounts, therefore, to hardly 33 per -cent.


Mr. STEVENS:: Does not the hon. gentleman realize that a substantial portion of these imports, by -the re-manufacturing process, enters into the item given for production? He is counting them twice.


Charles Edward Bothwell: That may be; no doubt a percentage of the -imports goes into that process. Nevertheless the percentage of imports to our total consumption- and we import manufactured goods as well as raw material in that total I gave-is as I have stated. Now that is a pretty fair record for an industry which does not appear to be native to Canada, because we import a considerable amount of raw material. It is true, as the hon. member for Fort William says,
The Budget-Mr. Bothwell

that we have in Canada raw material which might be made use of. At the hearing before the tariff board of the applications made by the manufacturing concerns in respect to iron and steel, a statement was made, as appears in the brief of the Algoma Steel Corporation Limited which was filed in connection with that application. They give a schedule at the back of their brief in regard to the use of Canadian ore, and I wish to read this particular clause from the first column:
There are in Canada reserves of iron ores of excellent metallurgical quality, and large tonnages of the these ores are available and contiguous to the Great Lakes water system, and therefore in a position to be cheaply conveyed to the consuming centres, which are also situated adjacent to the same water system, but all the known deposits of ores located in this district require beneficiation before they can be used in the blast furnace. The cost of beneficiation is in excess of the cost at whicli American lake Superior ores can be laid down at Canadian furnace docks at the present time, and therefore governmental assistance in the way of bounties would be required to firmly establish a Canadian iron ore industry.
Then I read from the evidence taken on that same reference to the Advisory Board on Tariff and Taxation; this is reference No. 2, the resumed hearing held on November 27, 28 and 29, 1928. At page 25 of the printed proceedings I find the following statement:
.... until increased mining costs in the American iron ore fields force the price of ore well beyond present levels, we will be unable to proceed with the development of this important future source of supply.
That was the statement made before the tariff board. If the situation in Canada is such that it is going to cost us considerably more to use our own ore and coal in order to manufacture iron and steel, surely at this time it is good business for us to get our iron and steel from some other place; otherwise we would take the money from the pockets of people who can ill afford to pay it and place it in the pockets of other people who possibly do not need it. If we in Canada are producing about 66 per cent of our own consumption of iron and steel products it does not appear to me that our importations will affect us seriously.
In connection with this same hearing, and after listening to the remarks made in this house from time to time in favour of increased protection, I was somewhat surprised in reading the record of this hearing to find that the representatives of the manufacturers were not agreed among themselves on this question of tariff. The hon. member for West Hamilton (Mr. Bell), who represented Dominion Foundries and Steel Limited said:

We are of the opinion that the removal of tariff from pig iron for steel making and the placing of compensating tariffs on more highly finished steel will increase the production of pig iron in Canada as a part of steel making operations, therefore, no harm results.
Mr. Moffat, of Moffats Limited, in answer to a question put to him by the chairman, said:
.... I do not understand what they mean by making pig iron free. I do not want to see pig iron from the United States free, but free from Great Britain.
Mr. Sherman, of Dominion Foundries and Steel Limited, said:
We also want it free from Great Britain, but we do not want to discriminate in our tariff.
Then I find the following:


The Chairman:: Do you think, Mr. Bell, the
tariff should be free in pig as against the United States?
Mr. Bell:	That is our proposition.


John Frederick Johnston: You remember the proverb
about the ill wind. Am I to understand that there is no objection to free pig iron?
Mr. Bell:	So far as this brief is concerned.
Mr. Long (Dominion Iron and Steel Company) :	Personally I should prefer not to
answer that question offhand.
Mr. Mclnnes (Dominion Iron and Steel Company):	I would say, no.
Mr. J. D. Jones (Algoma Steel Corporation): We are opposed to pig iron coming in free of duty; at any rate we do not believe it should be lowered any more than it is now.
If we have a number of manufacturers coming to the tariff board with no more unanimity than is shown from this evidence as to whether or not there should be an increase in tariff, I think it would be pretty hard for an economic conference such as has been suggested to arrive at anything definite in that respect. If a few of our manufacturers cannot agree among themselves on one particular item, with the varied opinions existing in Canada with respect to tariffs I am afraid an economic conference would not get very far.
Another item which has been stressed very often in this house is fruit and vegetables. I am not going to spend very much time on that subject, but I will say that I was rather interested in the bulletin read the other evening by the hon. member for Yale (Mr. Stirling) during the course of his remarks, the bulletin whose author he refused to name. After reading the speech of the hon. member I do not know whether that bulletin was sent to some dealer in the United States or where it was sent; there is nothing in his speech to indicate that. All I can see is that some fruit and vegetable exporter in the United States seems to have issued a bulletin in connection with some fruit damaged by

94S
The Budget-Mr. Malcolm
hail. However, I do know that so far as the people on the prairies are concerned, the people who constitute the natural market for British Columbia fruit, they cannot afford to pay anything more for fresh fruit than they are paying at present. If it should be the policy of the people of British Columbia or of this government to increase the tariff on fruit coming into Canada it would simply curtail the consumption of fruit on the prairies. Fruit has come to be recognized as one of the necessities of life, and surely we are not going to be compelled to pay more for it or else deprive our families of fruit entirely. Last fall you could not go into any fruit store in western Canada and buy the best British Columbia fruit; I do not know what they do with it unless they export their best and ship to the prairies only the third and fourth grade fruit. A11 we could buy were C grade apples; if we wanted a good apple we had to buy one which came from some place in the United States, because there is very little eastern fruit in that market. Whether or not this is the fault of the marketing board of British Columbia or whose fault it is I do not know, but I do submit that an increase in the tariff certainly will not benefit the people who have to consume British Columbia fruit, and I believe the fruit growers of that province are banking too much on what the government can do for them. When you consider that the consumers on the prairies must put up with low grade crops, with consequent low prices, you can easily realize that the amount of money available for anything which might be classed as a luxury is very limited.
Last fall in western Canada, while we had a big crop it was not a paying crop; in looking over the newspaper reports in connection with the crop last year I found some very interesting figures in a Winnipeg paper of October 23, 1928. That day there were inspected in Winnipeg 2,341 cars of wheat; of that number there were only 29 cars of No. 1 northern, 272 cars of No. 2, 412 cars of No. 3, 468 cars of No. 4, 401 cars of No. 5, 461 cars of No. 6 and 183 of feed. The prices ranged from S1.21J for No. 1 northern to 72J cents; over
1.500	of these cars were sold at prices averaging 86 cents per bushel. Then you have to pay the freight out of that, which meant that the average to the farmer for the
1.500	cars amounted to less than 70 cents per bushel. It is impossible for a farmer producing wheat at seventy cents a bushel to have much money to spend on luxuries, and I submit it would be a crime to compel him to pay more than he now does for the fruit
he wishes to purchase for the benefit of his family. The plea of the British Columbia people in asking for these legislative enactments is very well met by an article in the Financial Post of March 8, 1929. This article quotes Mr. T. H. Kirk, one of Vancouver's ablest business men, a financier of experience, as follows:
Our legislative efforts should be directed toward assisting the producer to find wider outlets for his goods. The orient is an important field. There is every opportunity for reciprocal trade within the empire; but if our producers are hampered by legislation based on entirely wrong principles our cost of production is going to be too high. If, on the other hand, we encourage production by not only assisting to find markets, but by developing by-products to deal with the surplus, we are adopting a constructive attitude toward the entire productive capacity of the people.


James Malcolm: Mr. Sipeaker, it is always with considerable satisfaction that one rises to compliment the Minister of Finance (Mr. Robb). He has on this occasion, as on previous occasions, presented a concise, easily understandable statement of the nation's business. I can also compliment the member for South Wellington (Mr. Guthrie), who gave the official criticism, in that he paid the Minister of Finance the tribute of having supplied statistical information as to the nation's accounting which removed from the field of controversy many subjects which had in previous debates occupied much of the time of the house.
Having had the pleasure of listening to the remarks of the official critic of the opposition, and having taken the time to read his remarks over carefully, I would say that when we eliminate the political thunder his observations and criticism can be boiled down to three statements. First of all, he admits that the country is in a prosperous condition; secondly, he admits that that prosperous condition is due largely to the intervention and assistance of a benign Providence and takes most of the eredit from the government; in the third place, he goes on to show that if the party to which he belongs were in power Providence would not have had to play such a large part, and that there would have been a greater general distribution of the prosperity which he admits.
No one can disagree with the first observation that the country is reasonably prosperous. I think anyone who disagreed with that statement would be placing himself on record as being against every known authority in the Dominion of Canada; he would be placing himself against a unanimity of public opinion such as has never been equalled.
The Budget-Mr. Malcolm

When he comes to the second point, that Providence deserves the credit and this government deserves none, I think he is going beyond the limit of fairness. I do not think I would yield to the hon. member in my respect and thankfulness for the bounties of Providence, but I would like to point out that Providence to-day, as in the past, is very good at helping those who look after themselves. Providence provides opportunities for an industrious man to profit by the bounties provided. Our great agricultural production is the result of scientific research on soil culture, careful working of the land and a certain amount of seeding. Providence provides no harvest of wheat where none is sown. Providence provides the soil which a man may work and from which he may reap the benefit. Providence does not mine, concentrate and refine any ore in our great mining areas.


Mr. MANION:: Does the government?


James Malcolm: Providence provides
opportunities whereby the wealth may be taken out of the soil through the engineering skill of man. Providence does not develop any hydro-electric energy from our streams. Providence provides the means whereby man, through his engineering ability, can take wealth from nature in that way. Providence provides no pulp wood mills in the forest, but provides the opportunity for industrious and intelligent people to profit by that wealth. The credit for the development of Canada's wealth is due to the industry of her people guided by wise leaders in governments, both provincial and federal.
Then we come to the hon. member's third point, that were his government in power things would be so much better. The hon. member said that the policies of this government had caused a decided concentration of the wealth of Canada in the urban centres. The memory of hon. members of the house would indeed be short if they could not recall the speeches which were made in this chamber during the years of 1922, 1923 and 1924. At that time it was said by hon. gentlemen opposite that if the government continued in its policy of legislating only for the basic producers our cities would diminish in size, industry would languish and there would be a greater flow of Canadian labour to American industrial centres. We were told at that time that our whole policy was against the industrial centres, but the wisdom of that policy of helping the basic producers has been shown by better figures in business, in banking and in transportation. The hon. member has said that the government has neglected the interests of the agriculturist and

the worker, and proceeded to say that certain policies in which he believed would work to better advantage in distributing the national wealth. There are certain economic statistics which I do not think indicate any concentration of wealth, but rather a distinct distribution. I would like to place on Hansard one or two of these facts as an illustration of my argument. Statisticians the world over have paid a great deal of attention during the past few years to the records of car loadings as representing the movement of tonnage and the business which is carried on within a nation. Every division of the Canadian Pacific and Canadian National railways shows an increased tonnage. Some parts of Canada show a greater increase than others, but the growth has been general. The hon. member gave great credit to the managements of the Canadian National and Canadian Pacific railways for the very healthy condition of their finances, and I think he was correct. Their healthy condition was brought about by one thing, and one thing alone: They handled a sufficient tonnage to enable them to earn money and thus put themselves in that position. I think it was in 1923 that the railways began to keep a record of their car loadings. The first records show that
2,851,000	cars of freight were moved in the Dominion of Canada during 1923. Five years later, in 1928, the number of cars of freight moved by our two great railway systems had increased to 3,696,000, an increase of 845,000 cars, or 30 per cent. My hon. friend realizes also that the increase was greater than 30 per cent, because during the past five years there has been a tendency to use a very much larger car and I think it can safely be said that during that period the per mile tonnage of the two great railway systems has increased by about 40 per cent. It cannot be otherwise than that this increase in tonnage has helped employment in the transportation systems; there must be a very greatly increased employment by the Canadian National and the Canadian Pacific to have handled this amount of tonnage, and as railway tonnage represents the labours of other people who produce it, there must of necessity have been a corresponding increase in employment to produce the tonnage referred to.
I think the hon. member for South Wellington said that unemployment in Canada stood at six per cent some years ago-I have forgotten the date-and that in February of this year it stood at exactly the same figure. It would seem as though he wished to leave the impression that there is to-day as much unemployment in Canada as there was then. My hon. friend knows quite well, as does

The Budget-Mr. Malcolm
every other thou, member, that one of the great problems of the Dominion is that we will always face a certain degree of seasonal unemployment. The United States of America is said to-day by the statisticians to have somewhere between 10 and 15 per cent of permanent unemployment, and this is a subject of very serious consideration in Washington. There are always 2 or 3 per cent probably wilfully unemployed; there are always in every country in the world men who are registered as unemployed and who are still retaining their jobs hoping to get better ones. We had a great deal of that in Canada right after the war, but the figures of industrial employment as furnished to the bureau by industrialists throughout the Dominion disclose a state of employment which is a credit to the industrialists and to the whole of Canada and it is a figure of employment that corresponds very closely to the figures of car movements by the Canadian railways. Using the 1914 figures as a basis of 100, we have it actually recorded by industrialists that in February, 1927, the index number was 96.6, or 3.4 below the average of 1914. In 1928 it stood at 102 and it now stands at 110, showing an increase of 20 per cent in the number employed in industry as compared with that of three years ago. I do not think one can ask for more conclusive evidence than the corresponding relationship between our car loadings and our record of employment as provided 'by the industrialists themselves.
The industrial and urban life of Canada has undoubtedly prospered by the additional buying power of our people. If the movement of freight were entirely concentrated in Ontario and Quebec, my hon. friend's contention might be well founded, but this is not so. The tonnage of British Columbia and the prairies, the tonniage of the maritime provinces as well as that of Ontario and Quebec have correspondingly increased. Therefore I think it can be shown that with the increase of car movements and of employment, there must have been a general condition of prosperity.
My hon. friend refers to this government as being a financial one; he says that we are interested in the big financial corporations. May I point out to him that much of the phenomenal growth of building in the last few years in all our cities has been due to the necessity of providing homes for our workers who have been receiving better wages and more continuous employment than they did in the past? The building program of the past year has been the highest on record in the Dominion and I do not believe there is any other country in the world where there 78594-60
is a fairer or better relationship between employers and employees. I do not think there is any other country where the average worker is living under better social conditions as regards the type of home he has, and the facilities for education and transportation. What my hon. friend was trying to point out I cannot tell. We find, however, that the people of Canada during the past few years have, in addition to providing better homes for themselves, spent more money on motor cars and other luxuries than ever before. Therefore, if spending money on luxuries indicates any measure of prosperity, I think it can be shown that prosperity is general. It might be contended that if the average Canadian citizen spent so much on luxuries there could not be much left for savings, but during the past few years savings have risen to somewhere about $1,526,000,000, a gain of $144,000,000 in two years. Savings in savings deposit accounts in chartered banks do not constitute the principle form .of saving in which the average person invests. I think more men are to-day investing in life insurance as a form of saving than in any other. We have the illustration of the Dominion having built up the enormous total of $5,609,000,000 worth of life insurance in force from the figure of $2,935,000,000 in 1921, or an increase of almost 100 per cent. If the people of Canada have been able to increase their savings in the past two years by $144,000,000, have in the past five years increased their life insurance in force by about $2,500,000,000 and have been able during that time to give as much business as they have given to Canadian industry for its products, by purchasing motor cars and comforts beyond what were considered comforts in the past, surely my hon. friend oannot be right in his contention that the worker has not prospered under this government's policy.
My hon. friend also contended that in some particular cases the policy of the government was inconsiderate, shall I say?-or at least thoughtless with regard to the agriculturist, and the particular illustration used was the dairy industry. From what my hon. friend said one would imagine that the dairy industry was in anything but a flourishing condition. My hon. friend endeavoured to place the blame on the New Zealand treaty; he said that if it were not for the treaty between Canada and the sister dominions of Australia and New Zealand, all would be well with the dairymen. My hon. friend's contention is not very wise when the matter is dealt with as one of international or empire trade. It is true that in recent years the production of

The Budget-Mr. Malcolm

cream, butter and cheese in Canada has diminished, but this is due to the growth of production in miscellaneous dairy factories. The quantity of condensed milk, evaporated milk and skim milk powder has increased from
59,500,000	pounds in 1922 to 95,400,000 pounds in 1927. The dollar value of those two figures is quite interesting. In 1922 we produced those three commodities to the value of $29,694,000 and we have to-day a production of $44,678,000. The production of dairy butter in Canada was less in 1928 than it was in 1927. But Canada was already an importer of butter in 1927. Our exports of fresh milk and other products of the dairy factories which I have mentioned, the condensed milk group, have proved more profitable to the average farmer in the Dominion, than the manufacture of butter, even though butter has maintained in the export markets a fairly high level of price. I have the prices here. The export price of butter in 1926 was 34.2 cents. In 1927, it rose to 39.6 cents, and in 1928, to 40 cents. The advance of domestic prices shows a correspondingly high return.. The facts are that in spite of the relatively high value of butter our farmers those to sell their butter in other forms, other forms for which they received more money.
I contend, Mr. Speaker, that there is absolutely no loss to the dairying industry because our farmers are milk producers in other forms, exporting to other countries, in forms *for which they get a better return, exporting over $30,000,000 of milk products. May I ask this question, Mr. Speaker? There are certain areas in Canada, such as the Fraser valley of British Columbia, where my 'hon. friends from that province know that they have turned their production very largely into condensed milk. They are shipping a very excellent quality of condensed milk to China. The British army of occupation in China is using condensed milk from the Fraser valley. Many of these producers must find it more convenient to sell their milk in that way than to make butter at home.
But there is another side to this New Zealand butter question which I wish to call to my hon. friend's attention. Our department is looking after the interests of the trade of Canada by building up an export of as highly finished goods as possible. The commonwealth of New Zealand, with its small population of a million and a half, does not offer much opportunity for a protective tariff. As a matter of fact, New Zealand imports practically all of its manufactured goods. The goods which it has to sell, due to the very favourable climate, are largely pastoral products such as wool, frozen meats, butter,

cheese and hides. Our exports to New Zealand were quite substantial. One has, first of all, sir, to consider this question:	Do we
want to trade with New Zealand at all, or not? Do we want to get $15,000,000 worth of manufactured goods into New Zealand? If we do want to trade with New Zealand there is only one thing that New Zealand can sell us. We might just as well be frank as business men, and recognize that fact. I think it can be shown that our exchange of products is very profitable.
Mr. Speaker, our exports to New Zealand cover quite a considerable range of products. We sold New Zealand rubber boots, rubber tires, automobiles and automobile parts. We sold them shoes, farm implements and many other articles. May I ask my hon. friend this question with regard to his criticism of New Zealand trade? The $15,000,000 which came to Canada provided, as I propose to show in a moment, a considerable pay roll for Canadian industry. Does my hon. friend think that the men who produced these manufactured goods for New Zealand did not eat some of the butter imported? Did they not provide some buying power in Canada in producing those goods? Were not they themselves, by virtue of the trade, able to take some of the butter which New Zealand says is all it has to give us in return for manufactured goods? I think my hon. friend will admit the logic of this.
There is another point on which my hon. friend criticized the government, and that is for allowing the cost of living to go up. I do not think my hon. friend said that the cost of living went up; I think he said it had remained stationary.


Richard Bedford Bennett: A trifling increase.


James Malcolm: In any event, he criticized the government in that respect. Now, Mr. Speaker, I contend that my hon. friend is not very consistent. He says: Keep New Zealand butter out of Canada. He also says, Give the farmer a high price for his butter, but keep the cost of living down. I do not see that my hon. friend can think anything else but that his is a very inconsistent argument. After all, however, it is only in line with other arguments used. My hon. friend said: You are injuring the job of the worker in the Dominion of Canada by importing $39,000,000 worth of agricultural implements. Quite so. It is a large amount of farm implements to import, and he led this house to believe that if the methods which he would adopt were followed this thing would not be. But I have before me, Mr. Speaker, a list of the imports of agricultural implements. It is

The Budget-Mr. Malcolm
an interesting list. My hon. friend remembers that when he was in the house a few years ago, and the party to which he 'belonged was in power, his government removed every single per cent of protection on tractors coming into this country from the United States. They did not leave one per cent of protection for tractors. I am not blaming my hon. friend; it was done in the interest of the farmer, but he cannot argue both sides of the question at the same time. He was in a government that put tractors absolutely on the free list, and of this enormous list of $39,895,000 worth of implements now coming in, I find that $21,000,000, or more than half of the whole, consists of tractors and their parts. I have nothing to say as to the advisability of the action of my hon. friend in doing this, but I do not think my hon. friend is so unfair that he will say to this government: You alone are responsible for doing this thing, and you are injuring the workers, when his government did the very same thing that this government did in considering the interests of the farmers in lowering the duty on implements of production.
I want to mention the speech of my hon. friend in one more respect. He presumed to criticize the extravagance of this government, and he made a rather unfortunate selection in criticizing the expenditures of the Minister of Public Works (Mr. Elliott) when he referred to the historical riding of North Bruce which I have the honour to represent in this house. My hon. friend showed the same lack of knowledge of Bruce that he did of the Scriptures when he substituted Macedonia for Damascus. I would like to point out to the house, Mr. Speaker, that the hon. gentleman failed to mention two of the largest industrial towns in the riding, the towns of Southampton and Wiarton, a district which incidentally at the moment is of such importance to the Hydro-Electric Power Commission of Ontario that a very strenuous battle is being waged as to who shall have the sale of power in that district. My hon. friend said that only seventeen boats cleared from ports in Bruce. The seventeen clearances referred to are self-unloading coal vessels that unload about thirty thousand tons of coal at Kincardine, much of which is used by the Canadian National Railways. My hon. friend is an Ontario man, and he knows that although the great lakes constitute the greatest inland avenue of water-borne traffic in the world, and have double the tonnage of the Panama or Suez canals, the people around the north end of lake Huron and surrounding Georgian bay have not asked this parliament for a single dollar by way of subsidy. There 785C4-60.J
is not one subsidized steamship service. All around the district represented by my hon. friend from Parry Sound (Mr. Arthurs), all around the north of my constituency, the fishermen and farmers have only one outlet for their products. All the steamship services are run privately, and have not asked this government for any subsidies. All that these people ask are grants towards the maintenance of their harbours. Referring to Tobermory, I may say that this is the finest natural harbour on the great lakes. My hon. friend from South Wellington is on sound ground in stating that Canada might well provide life-saving facilities at this point for the great lakes shipping. But it would be useless to attempt it on a small scale, and it would cost millions to provide it on an adequate scale. Tobermory is the base for wireless operations, and accordingly messages are brought there in time of disaster. The harbour will accommodate any size ship; there is no need of dredging. All this government spent was to provide a small public dock for the accommodation of the ships that anchor there. Reference has been made to an expenditure of seventeen thousand dollars at Lion's Head. From this village the products of the farm and fisheries are shipped by steamers. I do not know what the trade there amounts to, but I do know that sixty thousands dollars' worth of fish is shipped from Tobermory. To Lion's Head a regular line of boats sails weekly from Owen Sound and Wiarton and thence via Tobermory to the south shore of Manitoulin island, carrying fishing and farming products. The harbour had to be dredged and the dock repaired. Really seventeen thousand dollars is a very small contribution for the Dominion to make to assist this trade in fishing and farm produce. Apparently my hon. friend does not realize that the premier of Ontario views the district in an entirely different light. The province is spending tens of thousands of dollars every year to provide good roads in the district. I believe it is money well spent, for it will allow transportation through a district where it would not be profitable to build a railway. I do not think my hon. friend would care to be quoted as saying that if he were in power he would cut off public expenditures in these outlying ridings; certainly I would not like to be so quoted. He inferred that such expenditure was a big price to pay for my presence in this house. But let me tell him that the people of Bruce do not elect their representatives on the strength of what those representatives may be able to do for the riding by way of securing public works.
The Budget-Mr. Malcolm

However, they have the habit of electing representatives who do get public works where the works are required. So far as I am concerned, I know that the expenditures which have been made in my riding are fully justified.
Now, Mr. Speaker, may I mention a subject witih which Providence has not much to do; nor do I wish to give all the credit to the government. I refer to the export trade of Canada. I do not believe there is a man in this house who is not in absolute agreement with me-that the more highly finished the state in which we can export our products the more profitable will be the results to the country. The Department of Trade and Commerce is not exercised over the sale of such commodities as wheat, because those commodities find their own. markets'; but we are interested in assisting the sale of manufactured products. My hon. friend the leader of the opposition is quite correct in saying it is a difficult matter to draw an arbitrary line between what are manufactured and what are semi-manufactured goods, but our exports of manufactured and semi-manufactured goods last year represented a total of $648,000,000. Very few people can visualize the immensity of this volume of Canadian trade. Last year the United States-with a population of 120,-000,000-shipped $4,768,000,000 worth of goods; the United Kingdom $3,451,000,000; Germany $2,432,000,000; France $2,164,000,000. Canada stands twenty-seventh in population among the nations of the world, yet she stood fifth exporting to other countries $1,216,000,000 worth of goods, of which $648,000,000 was either in semi- or fully manufactured form, that is had been through some degree of processing.
An article may be manufactured in so far as the industry that produces it is concerned, but it may be the raw material for some other industry. Copper blister, mentioned by the leader of the opposition, is a good illustration of 'this. We import from the Argentine large-size hides. I think the hon. member for South Wellington referred to this importation. These hides are tanned in Canada, and shipped to Chicago to the harness-making plants. The large 'hides are purchased in order to give better cuts. That is a manufactured commodity export so far as Canada is concerned; it is a raw material import so far as the United States is concerned because it is bought as raw material for harness-making.
I wish to point out the value of our export of manufactured goods. The ratio of labour to the value of the goods going out of the factories of Canada is shown to be 43.8 per

cent. Hon. gentlemen who know something about industry are aware that overhead represents largely labour, expenses of sales force, advertising, bookkeeping, and so forth. All the raw material originating in Canada which goes into the factory as raw material is a finished product to the industry that produces it; therefore it represents labour. A very careful estimate-and I think it is extremely conservative-shows that for every dollars' worth of manufactured products exported from this country fifty cents is spent in the Dominion on labour in some form or other. On this basis our total of manufactured exports represents an expenditure on Canadian labour of over $300,000,000. Allowing $1,500 as the average return for the Canadian worker, it means that 200,000 workers of this Dominion are employed by virtue of our export trade in semi- or fully manufactured products. Accepting the ratio of one gainfully employed in every four, it means that the manufactured exports of this country provide employment for ten per cent of our total population.
Therefore, sir, I submit that nothing this Dominion can do is of greater importance than to assist her industrialists to find outlets for their commodities in the markets of the world; this brings employment to our working men, it brings money to our shores, and it provides markets for the raw material of the Dominion, whether wheat turned into flour, or lumber turned into sash and doors.
Without unduly flattering the officers of my department, I believe we have representing the Dominion throughout the world as intelligent and aggressive a group of trade commissioners as any country could wish to possess. It would take too much time for me to read the numerous letters of testimony which have been received. The writers voluntarily have complimented our men in the field for what they have done to gather business for Canada.
But there is another service of great importance. Some years ago we inaugurated a steamship service between the Dominion and South Africa. This service has developed a trade which has put Canada to the forefront as an exporter to South Africa. Last June we subsidized a steamship service to the east coast of South America. WTe are baying $100,000 a year for six trips from Montreal in the summer, and four trips from the maritime .provinces in the winter. We are now running four ships of eight thousand tons each to Brazil, Uruguay and the Argentine republic. We have increased the exports to these countries-substantially to Argentine

to $19,000,000. To the Argentine we sell farm

The Budget-Mr. Edwards (Frontenac)
implements to the extent of $3,000,000; rubber tires and footwear, $4,500,000; paper, $3,000,000; sewing machines, $4,200,000; automobiles, $2,000,000; dried and salted fish, $500,000.
The Canada-Australia service was started in 1892 with an annual subsidy of $100,000. The return subsidy paid by New Zealand is another $100,000, while the Fiji islands contribute $25,000. So that the service receives $225,000. There is a motor ship, the Aorangi, of 17,500 tons, and the Niagara, of 13,400. These services provide for the carrying of Canada's mail-a service which is said to be worth about $68,000. But the .point worth noting is that, when that service was instituted in 1892 Canada's trade with Australia was $293,000; to-day that trade has grown to $16,000,000. In 1911 our trade with New Zealand was $1,000,000; to-day it is over $15.000,000-that is, our trade one way. I wish to point out the value of these steamship services. I should like to refer to the service to 'South Africa.


Hewitt Bostock: Time.


Some hon. MEMBERS:: Go on.


Hewitt Bostock: By unanimous leave.


James Malcolm: I want to put on Hansard what we are doing, and it will take only two or three minutes. In addition to the servioes I have already indicated, the Canadian Government Merchant Marine have thirteen boats, with 100,000 tons gross capacity, sailing between Canada and New Zealand. From Vancouver to the British West Indies we have subsidized a service to the extent of $3,000 per trip monthly, the vessels calling at Trinidad and intermediate ports. This service was established in 1926 and as a result of it last year 86,000 tons of freight of various kinds went from British Columbia to the West Indies. Of that tonnage, 1,700 tons were transshipped to some of the other British possessions at which the steamers did not call. Valuable business was secured in Douglas fir by virtue of that service. In the development of the Maracaibo oil fields in Venezuela we managed to obtain orders for British Columbia fir, and through the service a substantial business will be retained for this Canadian product.
The service to South Africa was established in 1902 and am average subsidy of $125,000 has been paid, by means of which we have built up with South Africa a trade which has increased from about $4,000,000 to about $11,000,000.
Mr. Speaker, the house has been very indulgent in allowing me to complete the statement and I beg to be allowed to conclude in a word. I contend that Canada, in view of her export trade in manufactured goods, rendered possible by these services, can well afford where necessary to subsidize transportation to every country in the world when the results are as I have indicated. To obtain a volume of business which supports 8 or 10 per cent of our population, and this with the expenditure of less than half a million dollars, is, I believe, an accomplishment of which as Canadians we have a right to be proud. I do not believe that there is any form of government assistance which will be shown in the future to be of such importance to this Dominion as the assistance which we are giving to those who employ labour in this country, to find markets for their products in foreign fields.


Hon. J. W. EDWARDS (Frontenac Addington) :: I have listened with a great deal of sympathy to the hon. gentleman who has just taken his seat (Mr. Malcolm), because I realize that his health has not been quite good of late owing to a cold. May I express the hope that when the hon. gentleman's health improves-as I trust it will-his reasoning will improve proportionately. The hon. gentleman started by saying that there was unanimity of opinion in the Dominion regarding the prosperity of Canada. I challenge that statement at the outset, and I shall endeavour to show him that there are in Canada certain classes of people who are not enjoying the prosperity of which he boasts. The hon. gentleman referred to the part that Providence plays in our prosperity, such as it is, but in so far as the manufacture of our raw materials is concerned Providence gets no credit at all; any credit along that line must be given entirely to the government. The minister reasoned that, of course, it was advisable, it was better for Canada to have raw materials fully manufactured in this country since it gave employment to more people-that the more fully manufactured the goods which we exported from this country the more people there would be engaged in the production of those goods. Very well. Now let us measure the government by that standard and what do we find? I find that our exports of fully manufactured goods are decreasing; they are getting less from year to year. The minister shakes his head. Well, I have nothing better to go by than the report which is issued by authority of the minister himself. I appreciate the fact that, according to the judgment of the minister, in speeches made throughout Canada, and according to the statement of the Minister of Finance (Mr. 950	COMMONS
The Budget-Mr. Edwards (Frontenac)
Robb) the other day, we are not to put very much reliance upon these reports; because both the Minister of Finance and the Minister of Trade and Commerce have repudiated their own reports. The Minister of Finance repudiated them in an endeavour to bolster up or to lend colour to the treaty with France. He tried to show that a large percentage of the goods shipped was in some way diverted as it crossed the ocean. Ife said that France buys more from Canada than our records show.


An hon. MEMBER:: Hear, hear.


Mr. EDWARDS (Frontenac):: An hon. gentleman says "hear, hear." Well, I suppose that was as true before the French treaty was arranged as after. But may I point out that the United States records show that they export to this country over 8100,000,000 a year more than our records show that we import.


James Malcolm: Does the hon. gentleman want an explanation? It covers wheat going through Montreal-$91,000,000.


Alexander McKay Edwards: How do they know that some of the American wheat shipped by way of Montreal is not credited to Canada instead of to France? The whole point is this: the government have made some very foolish trade arrangements; in fact, they have never yet made a wise one, and they are endeavouring now by repudiation of their own records to bolster up these treaties and to make them appear better than they are. I would direct the attention of the minister to this fact-and it is a fact-that it is a part of the policy of the United States, and has been for years, to encourage the importation into that country of raw material and to work up that raw material into the finished article, thereby giving employment to their own people. In pursuance of that policy over half of the imports of the United States are in raw form and 53 per cent of all they export is in jhe manufactured state. Exactly the reverse is true so far as Canada is concerned. According to this record I have here, be it worth what it may, 26.6 of our total imports is now in the raw state as compared with 28.9 in 1922, and we are importing 64.9 per cent of fully manufactured goods as compared with 61.5 per cent in 1922. So that, measured by the standard the minister himself suggests, we are fully manufacturing less goods now than we did some years ago when this government came into power. Consequently there are fewer people engaged in our industrial enterprises and there is less employment. It is a fact that we do export 73 per cent of our wood and wood

products in the raw state, and we import 64 per cent of such products finished outside of Canada. Canada exports 87 per cent of her metals raw and imports 87 per cent of metal products more or less finished.
In order to present the matter as it impresses me I would like to refer to one particular article; I refer to asbestos, which we export in the raw state to the value of $10,000,000. Those exports go to some ten or twelve different countries, mainly to the United States but also to France, Japan, Austria and so on. The value of the raw rock exported to the United States is about $7,000,000; that is finished in the United States, after which it is worth some $36,000,000. There are 49 factories in the United States engaged in working up that raw material, giving employment to 6,129 people and having a payroll of $7,692,000. On this side of the house our contention is that the government have been indifferent and lax in encouraging the manufacture of our raw materials in Canada to the extent to which we believe they could be fully manufactured here.
Now I wish to refer to New Zealand for a moment; the hon. gentleman said, " Oh, we export goods to the value of some $15,000,000 to New Zealand," and he charged that hon. members on this side would scrap those exports because of our imports of butter from that country. That is not stating the case fairly; we are just as anxious to deal with other countries as are hon. gentlemen opposite, but we hope we never will be guilty of the mistakes they have made in their trade arrangements with other countries. May I remind my hon. friend that previous to the negotiation of this trade arrangement with New Zealand our exports to that country were about $1,500,000 more than they 'were last year. With respect to the dairy industry, the hon. gentleman laboured very hard indeed to bring forth an excuse which would be acceptable to his own side of the house and which might be swallowed by the country at large. He said, " Oh, it is true that we export less cheese and butter, but our milk is being made up in other forms." Very well; again we will take the hon. gentleman at his word and I will refer to another publication issued under his authority, which shows that our total milk production in 1927 was less by nearly 500,000,000 pounds than it was in 1926. I will give the figures; approximately 13,000,000,000 pounds of milk in 1927 and about 13,407,000,000 in 1926, and according to the same authority our production of milk in 1928 was even less. If the Prime Minister were here I would like to

The Budget-Mr. Edwards (Frontenac)
ask him if he believes that the New Zealand arrangement has worked an injury to the farmers; if you like we will admit that the Australian treaty has some advantageous points to it, but in the absence of the Prime Minister I would ask the hon. gentleman who has just taken his seat if he will not agree with me when I say that the New Zealand arrangement has worked an injury to the farmers of this country. Will he admit that?


James Malcolm: I have just made a
speech on it; I think it is a good trade arrangement.


Alexander McKay Edwards: Then	my
hon. friend does not admit the injury to the farmers?


James Malcolm: My hon. friend can
take any inference he pleases from my speech; it will be in Hansard to-morrow.


Alexander McKay Edwards: Then	will
the Minister of Finance venture to say whether or not the farmers of this country have been injured because of the arrangement with New Zealand? He is busy at present so perhaps he will think it over. The reason I have asked these questions is because on September 21, 1925, the Prime Minister made a speech in the town of Woodstock; referring to [DOT] this Australian treaty, which was to take effect on October 1 following, he said:
There is one condition of that treaty which says that we are free to alter or to abrogate it altogether on six months notice. I say to the farmers of Oxford that if the Australian treaty does any injury to your industry I will undertake to say on behalf of the government that I will give that six months notice on short order.


An hon. MEMBER:: Who said that?


Alexander McKay Edwards: The Prime
Minister said that on September 21, 1925. Now I would like to direct the attention of the house to a further fact; the Australian treaty came before this house and the representatives of the people in parliament were given an opportunity to express their opinions for or against it, but it was only after dissolution that the cabinet, consisting of some sixteen or seventeen gentlemen, sat around a table here and by order in council made the treaty arrangement with New Zealand without any previous negotiation and without our receiving anything in return. That is what I find fault with.
Just here I want to say that I believe a wrong impression is going about that the advantages of this treaty had to be extended to New Zealand, and in that connection I quote a section from the act itself:
.... subject to the customs tariff, 1907, the governor in council may, by order in council, extend the said advantages to gpods the produce or manufacture of any British country.
It was on the strength of that section that the cabinet extended these advantages to New Zealand, and that action was taken just five days after the Prime Minister made his speech in Woodstock. Was the Prime Minister dealing fairly with the farmers of Oxford county when he spoke to them on September 21 with regard to Australia and said nothing about an arrangement with New Zealand, or are we to infer that on that date the government had no intention of extending this treaty to New Zealand and that that was the reason the Prime Minister made no mention of it? This is just one of those autocratic acts which have characterized this government ever since it came into office.
With regard to this arrangement with New Zealand I would like to direct the attention of the Minister of Trade and Commerce to one or two figures showing the results of this unprofitable bargain and the effect which it has had on the dairy industry and the farmers of this country. In 1926 our imports of butter from New Zealand amounted to 3,193,382 pounds; in 1927 they had increased to 8,714,985 pounds; in 1928 this increased to 16,124,641 pounds, and the trade commissioner for New Zealand estimates that in 1929 New Zealand will send to Canada double the quantity sent in 1928. Then I would like to direct the attention of the Minister of Trade and Commerce to the fact that last year we imported 16,801,656 pounds of butter, and taking the figures given by his own department as to the milk production of the average cow, that importation would equal the production of
84.000	cows; allowing 10 cows to a farm that would give a good start to 8,400 farms, and allowing 5 people to a farm it would mean something to 42,000 people. I would add to that this further fact: Since this arrangement was entered into we exported last year 35,000,000 pounds of cheese less than we did before this arrangement was made. That would represent the production of 83,000 cows on 8,300 farms and would affect 41,500 people. Add these two together, and the result of the improvident bargain which was made would be equal to the production of
167.000	cows on 16,700 farms affecting 83,500 people. It is a significant fact that while the number of milch cows in Canada has decreased 101,000, according to the minister's own report, and the number of swine has decreased 197,422 in the last year, the dairy herds of New Zealand have increased during the last twelve months by 57,000 cows, and
952	COMMONS
The Budget-Mr. Edwards (Frontenac)
the number of swine by 66,755. We used 347,000,000 pounds less of milk in the production of butter in 1926 than we did in 1927; we used 377,000,000 pounds less in the production of cheese, but although a little more was used in other ways our total production of milk was less than it was before this arrangement was entered into.
I would draw this further fact to the attention of the minister to show him that the prosperity he speaks of is not general throughout the Dominion of Canada. I call his attention to the exports of certain farm products, such as pork, bacon and hams, lard, cheese, butter, milk and cream, milk-condensed, evaporated or as milk powder. When he studies the figures relative to the export of the surpluses of those articles, closely identified with this trade arrangement, he will find that for the last calendar year our exports of pork were $900,000 less than before this arrangement was made; our exports of bacon and hams $20,000,000 less; cheese, $8,250,000 less; butter, $8,000,000 less; milk and cream, $1,400,000 less; and milk-condensed, evaporated or as milk powder-$1,400,000 less. Previous to our entering into this arrangement the exporting of the surpluses of these products brought into the pockets of the farmers of the Dominion of Canada the tidy sum of $88,115,725. The figures for last year, two years after we entered into this arrangment,. show that, the farmers received only $47,179,797. That is to say, the action of this government has decreased the revenue of our farmers by over $40,000,000. I do not expect the Minister of Trade and Commerce to be very much affected by those figures, because I note that he is reported in the Goderich Signal, a Liberal paper, of August 16, 1923, as saying:
[DOT] ^jlic farmers are the most dissatisfied men m the Dominion of Canada.
He said the farmer's occupation was essentially a labouring job. That is true, it is a labouring job and it is not receiving very much encouragement under this administration. The article continues:
. The fact of the matter is that the farmer is spending more to-day than 100 acres will ever yield.
He deprecated the 'tendency to take more from a job than the job would earn and declared that the farmer should live on the money he actually earned. He said a mechanic could only have a mechanic's living at the best. He advocated' the importation of raw labour for the carrying on of our public works, and called attention to the fact that in years gone by the Irish came here and did
LMr. J. \V. Edwards.]
this work. They were unfitted to do anything else, and that is the reason they did this labouring work.


Henry Herbert Stevens: Who said that?


John Wesley Edwards: The Minister of Trade and Commerce. He then went on to say that the Italians came over and took the place of the Irish, and now the Slavs were the pick-and-shovel men of North America. All of this would seem to be indicative of the heartfelt sympathy the Minister of Trade and Commerce has for those who labour. The article continues:
Mr. Malcolm contended that Canada should continue to import raw labour which will live humbly and which will do a day's work for a reasonable fate of pay. Canada's development depends upon plenty of cheap labour.
And so his colleague, the Minister of Immigration (Mr. Forke), has brought into this country during the last two years, according to the statement of his deputy minister, over
100,000	men from central and southeastern Europe and has dumped them into the cities to rob good Canadians of their jobs and force them to leave this country and go to the other side of the line.
I am sure that every member of the house was very pleased when the honour came to the Minister of Agriculture (Mr. Motherwell) of being created a doctor of laws (by one of the universities. It is said that universities occasionally confer that honoured degree upon men of wealth with the object of having them make a large donation to an endowment fund, but in the case of the Minister of Agriculture I do not think anyone will say that it was done for that purpose. Undoubtedly this degree was conferred upon the Minister of Agriculture because of his outstanding merit and because of certain distinctive qualities which he possesses in a very high degree. I am glad to see the Minister of Public Works (Mr. Elliott) applauding so heartily, and I hope the same honour will come to him some day. What were the distinctive qualities which caused this university to confer the LL.D. upon the Minister of Agriculture? It seems to me that the one thing in which he excels, above all others, is in the vast number of new words and phrases which he has added to the English language, and the dignity he has given to slang and to political buffoonery. The minister took a trip over to Europe and he took along his car and chauffeur. Before he left he had emblazoned on the door of his oar the coat of arms of Canada, and it was the duty of the chauffeur to explain to the people who gathered round to see this wonderful automobile that the insignia on the door

The Budget-Mr. Edwards (Frontenac)
of the automobile represented the coat of arms of Canada and that it was one of the things with which the Postmaster General (Mr. Veniot) had not up to date interfered. What did the Minister of Agriculture do over there? He says that he visited Holland Denmark, Sweden, and Ireland. And for what? I use his own words: "I went over there and I examined the live hogs of all of our competitors." While he was examining hogs-and I hope he fared better than did the prodigal son of ancient times-his chauffeur was explaining the coat-of-arms. As he passed through the country in a blaze of glory, it looked to the people of France as though Napoleon had come to life again, and as he went through Germany the little children shouted " Hoch der Kaiser 1" The minister says that he has used certain yardsticks and that by all the yardsticks which indicate prosperity this is a prosperous country.


John Campbell Elliott: Yes.


Alexander McKay Edwards: The Minister of Public Works says yes. Let me direct this question to him:	Is it not true that in
his constituency any man can go out and buy hundreds of farms for the price of the buildings with the land thrown in? He knows that is a fact.


John Campbell Elliott: I might say to my hon.
friend, if he will permit me-


Alexander McKay Edwards: I will not
permit him to take up my time.


John Campbell Elliott: My hon. friend has asked
me a question. There is no port of Canada where an intending purchaser of a beautiful farm can do better than in the county of Middlesex.


Alexander McKay Edwards: I get my
confirmation from the minister himself, although he did not intend his remark in that way. He says that an intending purchaser can come into his county and buy a beautiful farm cheaper than in any other part of the country and he wants that understood. But what about the man who is selling the farm? Is it a yardstick of prosperity that hundreds of thousands of Canadians are leaving this country and going to the other side of the line in order to get jobs? Is it not true that millions of dollars are being spent in bringing hundreds of thousands of aliens into Canada to take the place of Canadians who have been deprived of jobs in this country? Is it an evidence of prosperity that we tear down whole city blocks in Ottawa and the Minister of Agriculture 'intimated that the intention was, in the course of time, to rip out all the
buildings along Wellington street and make it all a park? I suppose that will include the post office also. The Minister of Agriculture very properly held that a minister should be informed. Yes, of course, he should be informed. I presume it is just as well, when he goes trotting around Europe in a high-priced car, to take his chauffeur along with him so that he can be informed too and pick up some crumbs of information that the minister might otherwise miss.
I should like to direct attention to the importance of our home market. The home market for Canadian farm products based on the average of the last four years and indicating the percentage of the total production consumed in Canada, works out as follows:
Article
Cheese	
Milk, condensed or evaporated
or as milk powder	
Butter	
ZU per
51 per cent 95 per cent
Last year the amount of butter consumed in Canada was 99 per cent of what we produced. Let me direct attention to a statement which the Minister of Finance (Mr. Robb) will remember having made in 1925. He said that the policy of the government was to encourage *the bringing into Canada of butter, eggs and so forth from New Zealand, and that we would sell ours in the United Kingdom. May I remind the hon. gentleman that in 1926 we bad a market in England for more than 18,000,000 pounds of butter, and that last year we bad a market for 47,000 pounds. Instead of our finding a market in England for our surplus butter, last year England shipped to Canada 1,300,000 pounds of butter.


James Alexander Robb: Because the price was three
and a half to four cents a pound higher.


Alexander McKay Edwards: 
Mr. J. S. WOODSWORTH (Winnipeg North Centre):: Mr. Speaker, no westerner can be
very enthusiastic over the budget. Even the member for Lisgar (Mr. Brown) admitted that it did not contain much meat, but he seemed to find some solace in the fact that he could discover no poison.
I am inclined to think a good many of us are becoming rather weary of this negative goodness, in fact, I do not know whether we can even call it goodness. It is simply a stand-pat attitude. It is quite true that there is no further reduction in the income tax, and for that we are duly thankful. But there are practically no concessions to the western farmers, and, as far as labour is concerned, I am afraid that we are not particularly interested in the items of the budget. I recall an ancient condemnation of the Laodiceans, "I know thy works, that thou are neither cold nor hot; I would thou wert cold or hot. So because thou art lukewarm, and neither hot nor cold, I will spew thee out of my mouth." Some of the hon. members are inclined to say of the budget:	Because you are neither too
cold nor too hot, I think I can swallow you.
The amendment suggests that there is no provision for reasonably safeguarding and protecting the interests of those engaged in agricultural pursuits or in industrial employment in Canada. Perhaps it is hoped by the Conservatives that by taking such a position they may be able to attract the votes of those who are here specially representing the farmer or industrial groups. I am afraid, however, this amendment is altogether too general in its terms, and, as interpreted by the speeches, it simply means the old time-wom doctrine of protection.
May I point out, Mr. Speaker, without developing the subject, that protection of in-

The Budget-Mr. Woodsworth
dustry has never meant the protection of workers in industry. If it did, it might be some temptation to some of us to vote protection. But never yet, as far as I have been able to study the situation either in Canada or elsewhere has protection of industry meant protection of the workers. There was a very good suggestion contained in the report of the committee in Sydney which investigated the conditions among the steel workers. I referred to this report in my speech on the address in reply to the speech from the throne. The report to the ministerial association called attention to the fact that for the continuous operations in the steel works, that is, consisting of the coke ovens, blast furnaces and open hearth departments, approximately one thousand men a day are involved. The day shift is eleven hours and the night, thirteen, throughout a seven-day week. That is, the men in those departments work on an average of eighty-four hours every week, sixty-six during the week on day duty and one hundred and two for the week on night duty. Nothing whatever is being done for those men, and the federal government tells us that it has no jurisdiction. The report says, and I think very pertinently:
We recommend that representations be made immediately to the federal Department of Labour and to the Prime Minister of Canada, urging that if and when the steel companies of Canada are allowed a protective tariff, provision be made for the men receiving the standard hours of labour adopted by the parliament of Canada, namely, the eight-hour day.
I would urge upon the government that if protection is to be accorded to this industry -and it already has received much at the hands of various governments of Canada-the least that could be done would be to insist that the workers be safeguarded, at least, to the extent of reasonable conditions of labour.
The member for Wetaskiwin (Mr. Irvine) called attention to the unsatisfactory practice that at present prevails of the government bringing down a budget containing a great many different items and saying to the house: Take it or reject it. There is no alternative. In connection with a recent debate on another question, a sharp distinction was drawn by speakers on the government side between the respective functions of the administration and parliament, and we were told that the administration must assume the responsibilities for whatever course might be taken. Now, I know that has been the practice, but I would submit that there is no reason why it should forever continue to be the practice. In some respects the Prime Minister and the present government are more Tory than the Tory

administration in Great Britain. In this connection I would venture to call the attention of hon. members to a very interesting report presented to the British house by the Secretary of State for the Colonies, Mr. Amery. It deals with a suggested constitution for the island of Ceylon, and is the result of the work of a special commission presided over by the Right Hon. the Earl of Donoughmore. The report contains one or two paragraphs that I think might very well be taken to heart by this house. For instance, it is suggested that at the present time there is:
Uncertainty among those best informed as to the future form of parliamentary practice in Great Britain.
And:
Within political parties in Great Britain inquiries are constantly being undertaken to ascertain whether the machinery of parliament cannot be reformed so as to make it more responsive to public opinion.
Then will the house kindly listen to this- and it is from Conservative members of parliament in Great Britain:
We propose to take full advantage of the opportunities which we have enjoyed of gauging the deficiencies of current parliamentary practice and the direction in which the forces of constitutional evolution are now impelling us, and to frame our recommendations with the object of providing for Ceylon a form of government, modern, practical and democratic, *which will combine with the best elements of the parliamentary system, features designed to escape its ascertained and acknowledged weaknesses.
That is a remarkable statement coming from Lord Donoughmore and presented to the British house by the Conservative Secretary of State for the Colonies. The report goes on:
It is a scheme which is calculated to divert attention from the academic discussion of political theory to the practical consideration of the pressing administrative problems of the day.
How that would transform the discussions in this house 1
It is a scheme which, while giving responsibility as well as power, guarantees that political progress shall go hand in hand with administrative knowledge.
And further:
We have framed our proposals in some relation to the system obtaining in the most modern deliberative bodies of power and influence, such as the League of Nations. Here the representatives of the world powers, with all their varieties of races and outlook, have though fit to organize themselves on a basis of standing committees as the most convenient method of disposing of the program of administrative and detailed work which habitually

The Budget-Mr. Woodworth
confronts them, of facilitating practical achievement, of acquiring and distributing an exact knowledge of those problems which await solution, and of inspiring all members with that mutual confidence so essential to effective cooperation in the common interest.
The report proceeds to suggest a constitution under which the conduct of the business of the house will be divided into various committees, the members electing the chairmen of these committees, and the chairmen then becoming what we would call departmental ministers. I think such a modification might well merit the attention of this house. We cannot but think of its advantages as we are asked to say "yes" or "no" to the budget.
A great deal has been said pro and con in regard to our national prosperity. I have often wished I was in the happy position apparently enjoyed by some members of being able with a good conscience to say that all the people of Canada are happy and prosperous. Let me suggest that the various social and economic movements which are taking place do not altogether corroborate the idea of general prosperity. We can maintain our population only by importing the poverty-stricken people of Great Britain and the continent of Europe. During the period from 1921 to November, 1928, we expended on immigration no less than $16,242,219.03. Sixteen million dollars to beg people from Great Britain, Europe and the United States to come to this country I


Miss MACPHAIL:: And we cannot even keep them.


James Shaver Woodsworth: No, as my hon. friend suggests, we cannot even keep them. I suggest that if we spent one-quarter of that sixteen million dollars in making conditions a little more tolerable in this country the results would be better for the nation. From 1881 to 1928 we received no less than 5,599,250 immigrants. Yet notwithstanding that addition we have hardly kept the population that we would have had we been able to retain our own native-born. That does not seem to reflect any very great and general prosperity throughout the Dominion. I am not blaming this particular government. In my judgment the doings of this or that government do not matter very much in regard to these great economic problems, but I do say it is absolutely absurd for the government in the face of such movements to suggest that the great mass of the people are prosperous.
Then again there is the general shift from the country to the city, so that now over half of our population lives in urban centres. I am not one of those who believe it is possible to retain a great majority of the people in the country. I think machinery has been introduced to such an extent that we can hardly hope for that condition. But undoubtedly it is because the agriculturists of this country, and indeed the agriculturists of the United States, have been placed in such an adverse position that there has come this very swift shift from country to city. Further than that, there has come a very decided shifting of employment from the truly productive to what might be called the merely luxury occupations. As far back as 1917 Mr. W. J. Hanna, the food controller, put this very well:
That there have long been too many city people and too few farmers in ^ this Dominion is common knowledge, but it is not so well known that among our city people there are too many mere distributors, too many shippers, packers, carriers, wholesalers, retailers, advertisers, printers, salesmen, brokers, sub-brokers, deputy brokers, assistant-sub-deputy brokers and the whole army of people in the services and professions that wait upon the middleman.
I do not say that the functions of these nonproducers could be done away with, but I do say that there were and there are too many for each function-too much duplication of effort and equipment. . . . This inflated staff of non-producers, not only in Toronto but in every Canadian city and town, was and still is, dependent for its wages upon the movement of farm goods to the city and city goods to the farm, and all the over-specialized, overelaborated processes which a luxurious civilization imagines are necessary to its happiness.
We have to face that situation at the present time.
Futhermore, I suggest that the diminution in the birth rate is not altogether satisfactory. In 1921 the birth rate was 26-4, and from 1921 to 1926 it had fallen to 22. In eight provinces of Canada, Quebec excepted, there was a loss of 4-4; while Quebec dropped from 37-6 in 1921 to 32-1 in 1926, showing a loss of 5-5 points. In other words, there is a greater drop for the province of Quebec than for the other provinces of the Dominion. Or take the figures as given us in the census returns of families according to numbers. The number without children is 30-6 per cent; the number of families with one child, 20'9 per cent-that is to say, half of all the families in Canada have either no children or only one child; the number with two children is 16-7; the number with three children, 11-6; the number with four children, 8-0; the number with five children, 5-3; and the number with six and up, 8 * 7. I venture to suggest that the reason for the decrease in the size of families, while in part doubtless due to higher standards and even to the desire for certain luxuries, is also due to the fact that in the middle and wage-earning classes it

The Budget-Mr. W oodsworth
has become simply impossible for people to attempt to rear families of even a moderate size. They cannot afford to have families.
The unemployment and misery existing in some of our eastern cities was very well depicted a day or two ago by the hon. member for West Hamilton (Mr. Bell). In this connection may I direct attention to a very suggestive editorial in this morning's Citizen, from which I quote the last paragraph:
Well informed members like Mr. Bell must know enough of history to realize that only the most exceptional conditions under the present economic system can produce a situation where there are no employed, and hence no extreme poverty. They must know that a reserve of unemployed is one of the most helpful factors in the successful functioning of our present industrial order.
I wonder whether we all accept that. I* does not come from some radical journal, but from the Ottawa Citizen.


Henry Herbert Stevens: Pretty radical.


James Shaver Woodsworth: It is radical; that is why I quote it. I am one of those who believe that our present economic system is fundamentally inadequate to meet the needs of present day civilization, and it is such facts as these that drive me to that conclusion. But let me quote that last sentence again:
_ They must know that a reserve of unemployed is one of the most helpful factors in the successful functioning of our present industrial order. They must know too that the great weakness in the system is that while it produces magnificently it fails to be so impressive as a distributor-hence over-production and under-consumption; and finally they must know that any remedy they have so far put forward or ever contemplated, cannot materially change conditions which are inherent in the economic system.
The Labour members believe that the present economic system must be replaced by a different one; hence in discussing these matters we are very much under a handicap, because it is generally assumed in this house that the present system is functioning fairly well. Under these circumstances we can do little more than to show the weaknesses of the existing order. But I would point out , that even under the existing system we might expect to have have some alleviation offered by the government in power. The government, however, is offering practically no alleviation. Thus we are confirmed in our belief that there is something inherently wrong in the system. A friend beside me suggests that the opposition may believe the system is not perfect. I am glad to have the support of the opposition, and I fancy that if we were permitted to sit side by side in this

house many years longer we might make the Conservative opposition into very good socialists.


Mr. BELL (Hamilton):: My hon. friend
is not a socialist, I hope.


James Shaver Woodsworth: A socialist? That is why I am here. It all depends upon your definition of socialism.


An hon. MEMBER:: Give us a definition.


James Shaver Woodsworth: In a word, I would say this: we believe that the concentration of capital has gone on to such an extent under the existing system that it has got into comparatively few hands. We believe that a very small group of people have managed to gain control over this great system of production and distribution. We do not believe we can go back to the earlier system of individual production, and under these circumstances it is our opinion that there ought to be some sort of democratic control over the existing system-a control exercised for the advantage of the many and not for the profit of the few.
I should like to back up the appeal made by the hon. member for West Hamilton by giving a group of statistics which are closely related, one set to the other. The Department of Labour has given an estimate of family budgets at various levels. They take what they call the average family of five- for it is supposed that it is necessary that a married couple should have at least three children in order that, allowing for sickness and death, the race may be perpetuated. Taking the average family of five, the department says that the comfort level is $2,356.82; the health and decency level requires $1,719.23; while the minimum subsistence level is estimated at $1,396.92. They also give figures for what they denominate the poverty level. This they fix at $900, and the people receiving that income are on the ragged edge, apt to fall lower at any time. As a matter of fact, even where relief is well distributed, our relief agencies are frequently forced to give to families in the vicinity of $900 in order that anything like respectable conditions may be maintained in the homes under relief.
Now let us take the wages in Canada, and here we are not dealing with what it may be charged are the exceptional cases to which the hon. member for West Hamilton referred. A very extensive survey was made in 1921; let us consider the case of a skilled tradesman such as a carpenter. In Montreal the average earnings of an ordinary carpenter were $1,109.63; in Toronto $1,187.83 and in Winni-

The Budget-Mr. Woodsworth
peg $1,224.56. Then consider the labourer; in Montreal the average earnings of a labourer were $881.41, in Toronto $965.48 and in Winnipeg $980.37. In other words, unskilled workers in Canada are down at the poverty level, either slightly aibove or slightly below it, whereas such skilled tradesmen as carpenters receive a little less than what the Department of Labour has established as the minimum for decent subsistence; they are below the level of health and decency.
We had figures given us by a gentleman representing the cotton factories of Cornwall who came before the committee on industrial relations several years ago; he told us that in certain factories workmen were receiving only $15 per week. Under the Minimum Wage Act the girls in these factories were receiving $10 per week, not too large an amount to keep them in decency, but the men most of whom according to the evidence were married, were receiving only $15.


Leslie Gordon Bell: There are scores
of workmen in Hamilton getting no more than that right now.
Mr. WOODiSWORTH: Can any hon. member of this house say that is a decent wage? Can anyone say that fathers and mothers attempting to rear families can maintain them on a wage of that kind? It is all very well for the Minister of Finance, in looking over the bank clearances, the volume of trade and so on, to say that we are wonderfully prosperous, but surely when the great mass of the people are receiving wages such as I have indicated-and these statistics are furnished by our own bureau-it is impossible to say any longer that there is general prosperity among our people That is the situation we must face. Only the other day, before one of the committees of the house, a manufacturer said with regard to his own men:
I do not see how they can live, especially at this time. We are working from eight to four and not on Saturdays. They have to pay their expenses working about thirty-five hours a week.
Even civil servants in the employ of this government in many instances are receiving only $80 a month; they are down at the level of the poverty line. Now let me quote another set of statistics which seem to bear directly upon this question; let me give the average number of weeks of employment by workers of all ages in cities of 30,000 population and more, according to figures furnished in 1921. I select a few occupations and cities that are fairly representative:
Construction
Montreal	 42.69
Toronto	 41.34
Winnipeg	 40.67
Labourers
Montreal	 42.26
Toronto	 41.72
Winnipeg	 42.04
Therefore these people are working only forty or forty-two weeks in the year, and the wages received during that time must keep them for the entire year. If they have a period of illness; if any accident happens or there is any other calamity in the family il throws them back for years and forces then: to spend all their time paying debts. Some one may say that a number of these people have not large families. That is true, and I have here another set of statistics giving the average number of persons per family supported by heads of families of wage earners in cities of 30,000 and over, according to the figures of 1921:
Montreal		4.00
Toronto		3.41
Winnipeg	 3.61
That simply means that at a very early age the children must go out to work in order to supplement the wages of the father, and in this way we are mortgaging the future of the coming generation.
Now I should like to speak for a few minutes on some matters more directly related to the budget. After all, the government is a vast collecting agency; the estimated expenditure for 1928-29 is $385,160,000, an average of $40 per head, or $200 for a family of five. I submit that no family in Canada can be really uninterested in the way the people's money is spent when each family contributes an average of $200 per year.
How is this vast sum raised? The total revenue from taxation is $391,050,000; of that amount $58,500,000 comes from the income tax, leaving a total of $332,550,000 raised by indirect taxation, or an average of approximately $35 per head. The greater part of our revenue comes from the common people, and the larger the family the more they have to pay in taxation. On the other hand, how are these huge revenues spent? According to the Minister of Finance the principal expenditures attributable to the Great war, total 42.30 per cent. I submit, as I have done in previous years, that if to this total is added the amount made necessary in the collection of the much larger revenues and other large items of expenditure of that character, the expenditure attributable to the war will be in excess of 50 per cent. Howe-*"- we will

The Budget-Mr. Woodsworth
take the figure given by the minister, 42.30 per cent. Contrast that with other expenditures. I look at the estimates which have been placed before us and I note a few of the items and the relation they bear to the total expenditure, as follows:
Per cent
Scientific institutions	29
Health	23
Old age pensions	21
Labour	
1.09
On these four large and important departments of our public life we spend only one per cent of our revenues, while according to the figures given by the minister 42.30 per cent is spent on the last war. I think perhaps that very well illustrates one of the reasons why some of us connected with the labour movement are not tremendously interested in the budget. The common people of the country are getting very little out of it; the people who are receiving the greatest benefits under the budget are the people who hold a mortgage on Canada, many of whom obtained that mortgage by profiteering either during or since the war. Notwithstanding our protests of previous years the government have made absolutely no effort in the direction of a capital levy in order to extinguish our great war debt.
With regard to old age pensions, the Prime Minister said the other day:
I believe that everyone who has given any attention to public finance will agree that it is a thoroughly vicious system to have one body raise taxes and another body expend the money thus secured.
I think it was the member for Vancouver South (Mr. Ladner) who then asked: What about old age pensions? The Prime Minister then continued:
I think it is, yes: I have come to the conclusion that it is a thoroughly vicious principle.


Mr. ADSHEAD:: Who said that?


James Shaver Woodsworth: The Prime Minister. Let me compare that with what the Prime Minister said on March 26, 1926, when he was advocating the government taking part in such a scheme. He said:
As between the different provinces I fail to see where there is a distinction to be drawn between the money voted by this parliament say for the purposes of immigration which may go to place a man or woman in any one of the provinces, and money voted for preserving the individual no matter in what part of the Dominion he may be found. ...	1 am proud
to be able to stand here to-night and to join with others in giving permanent expression in the legislation of our country to the views and purposes that are therein expressed.

That is what the Prime Minister said in 1926 regarding the old age pension legislation, but he now tells us that it is a vicious system. I do not want to take the time of the house in discussing this question of the relative authority of the Dominion and the provinces.


Mr. SANDERSON:: I think the hon. member is mistaken when he says the Prime Minister was referring to the old age pensions when he used that phrase.


James Shaver Woodsworth: If the hon. member will refer to page 316 of Hansard he will find that the member for South Vancouver (Mr. Ladner) interjected the question, "What about old age pensions?" And the Prime Minister in answer to that question said, "I have come to the conclusion that it is a thoroughly vicious system."


Some hon. MEMBERS:: Order.


John Frederick Johnston: I would point out to the hon. member that in referring to a previous debate in the present session he is not in order.


James Shaver Woodsworth: My statement was in answer to a question.


Frederick George Sanderson: The hon. member is wrong: the Prime Minister was not referring to old age pensions.


James Shaver Woodsworth: If the Prime Minister's contention is correct, what about the administration of justice? Surely the Dominion collects certain revenues and turns them over to the provinces. What about the subsidies to the provinces? The Dominion collects and turns them over. What about the grants to the Canadian National railway system? The Dominion collects and turns them over to another corporation. What about the loans to harbour boards? The Dominion collects and turns them over as loans to various corporations over which it has no direct control. If it is a principle accepted by this house and by the government that this kind of thing may be done-it is done in other countries; it is done in Great Britain-that we may make grants for certain specific purposes, it does seem to me an extraordinary thing that the Prime Minister should make such a statement as I have quoted, even before all the provinces have adopted the old age pension scheme. I hope he will explain this statement for the benefit of the hon. members opposite.


Frederick George Sanderson: He did not make the statement the hon. member says he did.


Henry Herbert Stevens: Certainly he did.

The Budget-Mr. Lapierre


James Shaver Woodsworth: We should soon face this question of Dominion and provincial jurisdiction. Take the question of the eight-hour day. We are told by the government that that is a provincial matter entirely and that the Dominion cannot handle the situation, and this notwithstanding the fact that Canada solemnly signed a treaty in which she undertook to carry out that principle. We bring up the matter of a minimum wage and are told that that is a matter under provincial jurisdiction, yet here again we undertook to see that the provision of the Versailles treaty and the Washington convention were carried out. In regard to a great variety of matters of this kind we are told that the Dominion has no jurisdiction. It is quite true the Labour department is very busy preparing reports and statements with regard to all these matters; it is quite true the government permits us to have set up a committee of industrial relations and to have referred to that committee various motions dealing with matters of this kind, but we sit there week after week and give our best attention to the different questions and when we are ready to bring in a report we are told by the Department of Justice that the Dominion government has no jurisdiction over such matters. I think it is nearly time that this situation should be clearly placed before the country. If the Dominion government has no real jurisdiction with regard to these matters, let that fact be broadcast from the housetops so that we shall not come to Ottawa expecting that something will be done. The government should then be unable to play with this house and pretend that it is possible to do something when they know all the time that nothing actually will eventuate. I think that is not too much to demand from the government.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Mr. E. A. LAPIERRE (Nipissing):: Mr. Speaker, notwithstanding the discursive criticism we have heard from the opposite side of the house, the Minister of Finance (Mr. Robb) should feel highly gratified at the reception accorded his budget by the press and people of Canada. His successive budgets have indicated more stability, lower taxation and a rapid advance towards a greater state of prosperity than Canada has ever before enjoyed. Time was when a budget was awaited with anxiety, but our Robb budgets 78594-61
have inspired confidence and are now showing annually that Canada has turned the corner and is rapidly becoming one of the most enviable nations of the world.
Another cause for gratification on the part of the minister is the fact that during the present year the prosperity of Canada was nation-wide, all the provinces having benefited equally by the policy of the government. The maritime provinces, which have been slow in recovering from the aftermath of the war, have, by the implementing of the Duncan report, taken their place along with the other provinces. During the last few years British Columbia has enjoyed the greatest prosperity since confederation. Agriculture, mining, fishing, industrial progress and the development of its ocean ports have placed it in one of the most enviable positions in the Dominion. The situation in regard to the three prairie provinces I shall leave to the Hon. Mr. Crerar who, in an address delivered in Montreal on February 17, made the following statement:
Western Canada's growth was described as one of the most remarkable developments in the world by Hon. T. A. Crerar, of Winnipeg, at the Thistle Curling Club's weekly luncheon to-day. As an example he stated that prior to 1908 the record for wheat production in the prairie provinces had been 100,000,000 bushels, while last year it had been 540,000,000. Last year's crop he estimated would net the farmers of western Canada $450,000,000. Profit on live stock production would net $57,000,000, and on dairy products, $56,000,000. Each year, he pointed out, the grain belt was reaching further north and in Alberta it now reached to 600 miles north of the international border, the Peace river country, in his opinion, was destined to become one of the greatest grain producing areas known.
Europe and Asia provided great markets for Canada's surplus volume of grain, Mr. Crerar continued. Canada was one-third the distance to Europe or Australia, while the rapidly increasing population of the United States -was eliminating that country as a wheat-exporting area. Russia also was pacing as a country of potential exporting possibilities and Canada was the logical country to fill the void.
The prosperity of the two older provinces of Ontario and Quebec is reflected in their budgets for the last fiscal year. Both those provinces have enjoyed the most prosperous year in their histories and they find themselves with ample surpluses that can now be used for the betterment of their people. But of all the industries which have contributed to the prosperity which has come to Canada there are three which- deserve special mention, namely, pulp and paper, water-power and mining. These three combined have perhaps contributed more to Canada's progress than any others. The pulp and paper industry, the development of which dates back less than

The Budget-Mr. Lapierre

a decade, has been developed without any governmental assistance and has placed Canada in the proud position of being the greatest producer of newsprint in the world. The capital invested in our pulpwood industry amounts to $580,000,000. At the end of 1927, one hundred and thirteen mills were operating, employing 32,876 men, disbursing in salaries and wages $46,674,293. In 1928 Canada's newsprint production increased fourteen per cent, while during the same period America's newsprint production increased five per cent. In 1913 there were produced in Canada 350,000 tons of newsprint. In 1927 there were produced 3,000,000 tons, a gain of 570 per cent in fourteen years. In 1927 Canada produced newsprint valued at $132,286,729, making Canada, as I said before, the greatest producer of newsprint in the world. When we consider, Air. Speaker, that less than fifteen years ago newsprint had taken but a very small place in our industrial life, this growth, as I have intimated, has contributed very largely to the prosperity of Canada.
Another industry to which I wish to refer, Mr. Speaker, is that of our water-powers. In these years of keen competition our water-powers are one of our greatest sources of wealth, and will in the course of time be the prime factor in making Canada one of the leading industrial nations of the world. No possession which Canada has is more envied by other nations than our almost unlimited water-powers. Those of us who were in the north country less than twenty-five years ago have lived to see that great area transformed from a wilderness into great industrial centres, of which newsprint is the basic industry, all due to the presence of a large amount of water-power.
The potential water-power of Canada that we know to be available amounts to 33,000,000 horse-power. We have at the present time a capital investment of over one billion dollars in developed water-powers. Of that 33,000,000 horse-power, in 1900 we had developed 170,000 horse-power. In 1928 we had developed 5,100,000 horse-power, an increase of 2,900 per cent in that period. As every thousand horse-power developed in connection with industry creates employment for 385 men, when we have reached the point of total development we will employ, directly or indirectly, 15,000,000 men, which means that Canada will have sixty millions of a population when all her water-power is developed. Our water-powers have been developed as follows: in the province of British Columbia there are now developed 9-2 per cent; in Alberta, 0-3 per cent; in Manitoba, 4'75 per cent; in Ontario. 26 per cent; in Quebec,

15-8 per cent; in New Brunswick, 50 per cent; in Nova Scotia, 21 per cent, and in the Yukon, 5 per cent. Possessing such an enormous quantity of horse-power, these sections of our country which have available so much of this white coal will, I have no doubt within the lives of those who are here to-day, rank amongst the largest industrial centres in the world.
Another industry, Mr. Speaker, which has come to the forefront very rapidly during the last twenty-five years is the mining industry. For many years those who were first interested in this industry found it very difficult to convince the average citizen of the tremendous potential value of our mining area. We have heard a great deal about agriculture, but it may surprise hon. members when I say that less than fifteen per cent of our great country is suitable for profitable agriculture, and that the other eighty-five per cent of our great heritage comprises the largest mining area known to science, an area that contains all the best and most valuable metals known to geology. This vast precambrian formation, which is as yet only barely scratched, has perhaps the largest potential wealth of any of our natural resources. Our mining industry, which produced $273,000,000 during last year, is but in its infancy, and the amount of its production during that period is no indication of what the near future has in store for us. Some of the recent discoveries made in Quebec, Ontario, Manitoba and Alberta indicate greater possibilities than in any other of our natural resources. Mining will also contribute very largely to the solution of our transportation problem. We are informed by economists in the United States that sixty per cent of the tonnage of American railways originates in the products of her mines. And it does not take much imagination to visualize what will happen in this country when these vast areas are fully developed. At the present moment we are producing 85 per cent of the world's nickel, 90 per cent of the world's asbestos, and we will soon rank amongst the largest copper producers in the world. Gold, silver, nickel, platinum and zinc are now being found in large deposits, and as only a small area of this vast formation has been explored, its future possibilities are beyond calculation. The mineral production in Canada for the year 1928 was $273,000,000, a gain of 140 per cent in sixteen years. In 1910 Ontario produced $42,637 in gold, and in 1927, $33,627,040. In nickel and copper, in 1928 Ontario produced $30,000,000. The gold, silver, nickel and copper mining industry gave employment to over five thousand men, and

The Budget-Mr. Lapiene
distributed in wages $9,520,939. To the end of 1927 Sudbury nickel and copper Cobalt silver, Porcupine-Kirkland gold had produced over one billion dollars. In dividends Sudbury nickel and copper had distributed over one hundred million dollars, Cobalt silver a like amount, and Porcupine-Kirkland gold seventy million dollars.
Time does not permit my going into further details of the wonderful development of our mining industry. Recent discoveries in the constituency which I have the honour to represent are such as to attract the attention of mining men throughout the world. As was stated by the thon. member for Vancouver-Burrard (Mr. Clark), there is a mine- in my district which in three years has increased in value from one hundred million dollars to one thousand million. These figures may sound fantastic, but they are known to the mining men of the world to-day. I may say [DOT] that from present indications other mines now being developed may also become great producers. In the Sudbury area we are producing all the -base and precious metals, and I have no hesitation in saying that we have in a small area of forty by twenty miles what at an an early date is going to become the largest mineral-producing area known to the civilized world. This is but one of the several mining camps which are rapidly becoming producers, and which in a few short years will be contributing largely to our national wealth.
British Columbia is fast coming to the fore as a producer of copper, and in northern Quebec there is a co-pper mine of great potentialities. In fact within the next few years we are going to 'become an important factor at a time when there may be a world shortage of this metal. During the visit to this country of the British Empire Mining and Metallurgical Association grave fears were expressed of such a shortage in the near future. Well, should that contingency arise, these recent discoveries of rich copper deposits will enable us practically to dominate the situation.
The rapid development of our great mining resources is reflected in our trade and commerce. The figures show a very satisfactory expansion, and this is most gratifying to those of us who have always had confidence in the wise policies of the government, policies which have tended to build up our overseas trade to its present impressive volume. We are now competing in the markets of the world with our manufactured products. The following figures of exports per head of population show that we lead the w-orld:
United States	$ 77 per head
Great Britain	 190 per head
Canada	 241 per head
This demonstrates the very satisfactory development of our foreign trade, and is ample proof that the tariff policy advocated and put into effect by the government is the policy best suited to our economic needs.
During the debate, Mr. Speaker, there have been frequent references to our trade relations with the United States, based on President Hoover's inaugural address. In my view those references are most -inopportune, for I 'believe that the wise policy of the administration has manoeuvered Canada into such a favourable position that she will be able to obtain from the United States a satisfactory trade arrangement without any resultant loss to our agriculturists. As a result of the investigation before the ways and means committee in Washington, the people of th-e United States are beginning to realize that their high protective tariff policy is responsible for problems of such gravity as have not confronted any president during the last quarter of a century. That investigation has disclosed that after a period that has been, perhaps, the moit prosperous in the history of the United States, President Hoover and his administration are face to face with several grave questions, such as the rapid concentration of wealth in a few hands, surplus production, chain stores, mail order houses, the agriculturists' demand for relief, and unemployment. Those of us who have followed the economic development of the United States realize that, being highly industrialized, their manufacturers must look to foreign markets for the disposal of their surplus production, but that their high cost of production will be an almost insurmountable -obstacle to their competing successfully in the markets of the world. This means that the Republican administration cannot afford to put into effect any tariff policy which will shut out from their market their best customer-Canada. Moreover, there is a rapidly growing sentiment in the United 'States that a high tariff policy is no longer applicable. The solidarity of opinion in regard to tariff which until recently characterized a large portion of the industrial population of 'the United States is rapidly diminishing, and before the ways and means committee at Washington a large nu-mber of industrialists demanded a lower tariff and in some cases free entry -of raw material. Some of the leading financial newspapers in the United States are to-day sounding a note of warning. I have here an article from the Journal of Commerce in which the following appears:
According to reports which have been sent to various newspapers in this city by trust-
The Budget-Mr. Lapierre

worthy correspondents in that country, the inhabitants of Canada from west to east are feeling a good deal of worry at the proposal that has been made to adopt tariff duties at Washington which are quite manifestly intended to discriminate against them. Among these are the very high rates on farm products of various classes. True, they do not specifically discriminate against Canada, because they are technically applicable to goods from all parts of the world, but since Canada is the only quarter from which we are likely to get these goods in very large volume, they do, as a matter of fact, operate as a severe handicap upon Canadian trade with the United States. There are many other phases of the situation that appear to figure largely, but this one may be taken as a sample of all.
It ought not to be necessary to enlarge upon the various reasons why a friendly and considerate policy ought to be pursued by this country toward Canada. There are many such, and most of them are based upon the highest grounds of international good feeling. For the immediate purpose however, it is necessary only to refer to an obvious, but essential consideration -it would be bad business for us to do anything that could alienate the good feeling of the conservative men in Canada, or that could afford a reason to those who are alwiays seeking to find some cause of offence in our conduct for attacking our trade and subjecting it to hardships.
The Journal of Commerce has on former occasions called attention to the fact that our export trade is a home industry which is greatly in need of attention.
The Boston News Bureau on the same date gives out the following:
It may not be true, except as a matter of business policy, that "the customer is always right." But two great neighbours who are a geographical unit would gain more from an approach to economic unity than from a tariff war. Far better the greatest possible interchange of goods than an unconsidered increase of duties that would affect adversely a fifth of our entire export trade.
In connection with the findings of the ways and means committee at Washington during the months of January and February, I would quote the following:
But industry and finance speak with divided minds. There are some great enterprises in this country that require foreign markets. Such industries as the automotive, secure in their dominance of the domestic field, are more interested in cheapening costs of production to improve their competitive position abroad than in the tariff. Other manufacturers want cheaper materials from abroad, like dyestuffs, to enter the country. Merchandisers, naturally, seek cheap supplies of finished goods. International bankers are becoming so heavily committed in other countries that there has developed in that quarter a more liberal view- toward opening the American market to products of specific foreign industries or countries.
The foregoing quotations indicate that the tariff policy of the United States has created there a condition which has become quite

acute; and to-day, owing to the far-seeing policy of this government, we find ourselves in a position where we can await with complacency any action taken by the congress of the United States, feeling that in our present industrial situation we can fully cope with any contingency that may arise. It would be a great calamity if, after more than one hundred years of peaceful relations between Canada and the United States, and at the present juncture, when the relations between that country and Great Britain demand that we become more or less the liaison nation between them, we should enter upon a policy of retaliation in respect of the United States. I say to my hon. friends opposite, therefore, that, in my opinion at any rate, our position in that respect at the present moment is far better than it would have been had we adopted their policy of "no truck or trade [DOT] with the Yankees" or their high tariff policy of "brick for brick" with the United States. We have lived peacefully with our neighbours, and under the existing conditions we have grown to prosper. If, therefore, we continue on the lines along which this nation has prospered, we are bound in the very near future to take our place amongst the leading nations of the world.
Mr. H'. E SPENCER (Battle River):	In
rising to take part in this debate I wish first of all to congratulate the Minister of Finance (Mr. Robb) on the very fine presentation he made to the house in submitting his budget. I wish also to congratulate him upon being able at the present time, with the trade of Canada as it is, to announce a surplus of some $69,782,000. To this extent the national debt has been reduced.
The budget has been praised by all members to the right of the Speaker, quite naturally, and criticized by those members who call themselves the official opposition. This is natural under the party system; but as one who does not believe in the party system I will neither praise entirely nor blame entirely the matter contained in the budget. I shall not stint in my praise of those things in it which I think deserve praise, nor shall I hesitate to criticize where criticism is due.
During his speech the Minister of Finance referred a good deal to the prosperity of the country. I am glad to say that to a certain extent there is prosperity, if you take bank clearings, car loadings and so forth. But can we say that we have prosperity throughout this country if the standard of living among the masses of the people is not as high as we might prefer it to be? I would say that 80 per cent of the people of Canada are more

The Budget-Mr. Spencer
worried over making both ends meet than over spending any surplus income which they might have. If twenty people have an aggregate income of $50,000 yearly and one of the twenty happens to receive $40,000 of that total, there is not very much left for the other nineteen.
When all is said and done, what is prosperity? According to aggregate statistics the people of the United States have it in abundance, yet James J. Davis, the United States Secretary of Labour, as recently quoted by the Calgary Albertan, states that 86 per cent of the Americans are poor. Figures compiled by the Federal Trade Commission at Washington show that one per cent of the people own 59 per cent of the wealth of the country; 13 per cent of the people own 90 per cent of the wealth; 87 per cent of the people own only 10 per cent of the national wealth, and of the total national income 50 per cent goes to capital. The United States is enjoying great prosperity; so is Canada, to a certain extent, but if Canada is similar to the United States in the figures I have given,-and I think we are very much like that country in this respect, can we say that we have general prosperity?
We find that our national debt is still very large, totalling $2,227,068,000. A certain amount of that debt is being written off this year, but I claim that we should have a more systematic way of dealing with this debt than by chance surpluses shown in the budget. A few nights ago the hon. member for Wetaski-win (Mr. Irvine), speaking on the budget, made some reference to the need of care being exercised by the Minister of Finance in either paying debts or issuing bonds. At the time the Minister of Railways (Mr. Dunning), was rather critical of the statements made by the hon. member, but I claim that my hon. friend from Wetaslciwin was treating a serious subject in a very able way, and it would be well for this house if more hon. members made a study of the problem my hon. friend was trying to place before us. In my opinion care should be taken by any Minister of Finance not only in issuing bonds but also when he is paying off debts, because if instead of taking advantage of the Finance Act and the treasury board we raise money by issuing bonds or treasury bills, it is a fact that as the hon. member for Wetaskiwin said-in the paying of a government debt we simply create a private debt. To meet the payment of a bond coming due, the Minister of Finance must obtain money through taxation, either directly or through tariff taxes, but in any event the taxes are drawn from the people.
They are paid to the minister, and he pays them out to meet the bonds ot treasury bills. That money is again released, but it is released only to investors, and while the taxpayers are many the investors are few. If the Minister of Finance tries to pay off large debts in dull times he reduces the purchasing power of the people and drags down prices, making times so much harder; on the other hand it is essential that we should try to raise as much money by way of taxes as the people will stand in prosperous times, when the effect of paying off amounts owed by the government will not be nearly so harmful. There is no doubt in my mind that in Canada we have not taken advantage of times of inflation to pay off our debts. The greatest mistake of all was made during the time of the war, when we did not tax the people who were making large incomes to meet a part of the war debt which was being created.
Referring again to the necessity of watching not only the issuing of bonds, but also the paying of debts by the government, I would remind the house that with a given amount of money and a given quantity of goods, if you put more money into circulation and do not increase the quantity of goods, you will enhance prices, assuming that the velocity of money in unchanged. On the other hand, if you reduce the amount of money by taxing the people heavily, and do not alter the quantity of goods available, you will change the basis of the purchasing power by lowering prices; and therefore it is the business of any Minister of Finance to watch both the payment of bonds coming due, and the issuing of new ones, so that he can act according to the necessities of an inflation or deflation period.
Looking for a moment to the revenue of the country I find that in customs import duties we raised no less than $185,000,000, or 41.11 per cent of our total revenue. According to the Liberal Party handbook of 1919, it is claimed that for every dollar raised by customs duties at least three dollars go into the pockets of protected interests. If this is true -and we will take them at their word- in raising this $185,000,000 for the exchequer $555,000,000 has gone into the pockets of protected interests; if we add the two amounts together we find that this year the people have been taxed to the extent of $740,000,000. Does this look very much as though the party in power have gone very fair in redeeming their promises of lower tariff, or have travelled very far toward the ultimate goal of free trade? From excise taxes, the stamp tax and the sales tax we received $81,500.000 or
The Budget-Mr. Spencer

IS. 11 per cent oif the total; through the income tax we received $58,500,000, or 13 per cent of the total, and by means of excise duties $63,500,000 or 14.9 per cent of the total. I notice that the income tax stands fourth in the amount of taxes produced, and I want to congratulate the Minister of Finance and those who assisted him in drawing up the budget in that they have not seen fit to reduce the income tax as a certain minority throughout this Dominion have requested during the last few years. During this period of so-called prosperity-and I will admit that it is a prosperous time for the few if not for the many-I will say that we might have gone further and increased the income tax on a sliding scale in order to obtain a little more revenue to pay off a little more of our national debt.
The following are a few items of expenditure :
Penitentiaries	$ 1.800,000
Health	 900,000
National	defence	
18,000,000Scientific	institutions	
1,100,000Agriculture.. .;	
7,390,000
It is rather a blighting criticism to make when one can say that we are spending twice as much on our penitentiaries, in this law-abiding country of Canada, as we spend on health; that we are spending on scientific institutions only about half of what we spend on our penitentiaries; that we are spending $18,000,000 on national defence, just after having signed a peace pact to outlaw war, and not quite half that amount on the basic industry of this country which employs 54 per cent of the population. I think those figures will be worth looking into, and I am sure that certain adjustments could be made with profit.
In looking over the budget speech of the Minister of Finance, I notice that we are paying annually for the cost of the last war no less than $162,911,000, or 42.3 per cent of our total expenditure. We know very well that the last var was an absolute failure, both to victors ind vanquished. What are we doing in a public way to eradicate the roots of war and eliminate the possibility of another such conflagration? We know that wars are no longer caused by religious controversies or national animosity, and very rarely by the need of land for national expansion. But we do know that there is an economic war going on all the time which, if we do not find ways and means to stop it, will lead to military warfare. It is rather interesting when you consider the fact that in olden times the victors in any war always took goods away from the vanquished. 1 o-day all that is changed. When we have
fMr. Spencer.]
half the world at war with the other half today, what do the victors do? We know what they did under the treaty of Versailles: they tried so to arrange things that the victors could force their goods on the vanquished- just the reverse of what was the custom in dajrs gone by. Why is this? Through the aid of science and machinery we have brought about a condition where we have to face the problem of consumption and not of production. Science is rapidly transferring the work from the shoulders of men to that of machinery, and it will only be a few years before we will see individual factories in industrial countries-and most of the countries are becoming industrialized-operated by a dozen men only. Under such conditions we have to recognize that unemployment is a sign of social development. We cannot consider unemployment as a passing event or something that will happen only now and not next year, because the countries are turning out goods so much more rapidly than in the past they feel they are forced to look for markets abroad. Most countries are also putting up tariff barriers of one kind or another in an effort to prevent goods from coming in from the outside. If we do not put a stop to this economic warfare it can only lead' ultimately to military warfare.
I congratulate the government on the various treaties they have negotiated in an endeavour to get away from this condition, but I cannot agree with their Australian treaty. I think that was a one-sided proposition, because they penalized agriculture for the benefit of industries which were better able to look after themselves. I criticized it and I voted against it when it was before this house. I did so because I believed it worked a hardship on the public of this country in the matter of a very necessary food-raisins. A three cent duty was put on raisins in anticipation of obtaining most of this commodity from Australia. The latest figures I have been able to obtain on this question show that although we consume annually some 37,000,000 pounds, Australia has only supplied us with 824,000 pounds.
I appreciated the minister's budget speech very much, but I would have liked him to go into the problem of how we are to meet this situation of economic warfare and obtained his suggestions how to prevent it from going on and turning into something worse.
The minister claimed that he had a trade balance of $154,100,000, and he tried to make the house believe that that was something to the advantage of Canada; that it was something we could put aside to our credit and

The Budget-Mr. Spencer
use another year. I think it would have been only fair had he reminded the house that this balance should be put against certain invisible items which are now figured against us, such as freight payments and receipts, tourists' expenditures, interest payments and receipts, immigrants' remittances, expenditures of government, charitable and missionary contributions, insurance transactions, advertising, motion picture royalties, and capital of emigrants and immigrants. When all such items are taken into consideration any difference shown would represent capital movement into or out of the country.
Much criticism has been made during the course of this debate, particularly by hon. members directly to the left of the speaker, with regard to the large amount of goods which the United States send to Canada, compared with the goods Canada forwards to that country. The hon. member for Fort William (Mr. Manion) stated the other day that although the United States send so much more to us than we do to them, on the other hand several other countries treat us much better. He referred to the following countries, and said:
The Argentine buys from us nearly twice as much as we buy from them; Belgium two and a half times as much; Brazil over three times as much; Chile nearly seven times as much; China over six times as much; Denmark twenty-five times as much; Germany two and a half times as much; Japan three and a half times as much; the Netherlands over five times as much; Portugal eight times as much.
I ask the hon. member this question: if it is not fair for the United States to send more goods to us than we send to them; if he is advocating that we trade fifty-fifty with the United States, surely he must be logical and suggest that we should cut down our exports to the different countries I have named until we are on a par with what they are exporting to us. Trade is a natural development and no goods will come into a country unless they are required.
The minister states that about one-third of our total exports is grain. I should like to remind him that if we consider the tremendous percentage of our exports that giain constitutes, we should be placed in a position to secure our farm machinery just as cheaply as possible. We have no opportunity of taking advantage of the tariff schedules, and therefore I advocate most strongly what the hon. member for Last Mountain (Mr. Fansher) asked for a few nights ago, namely, that the Minister of Finance reduce the tariff on combine harvesters from where it is at 10 per cent to 6 per cent. It is, I think, intended to come under the 6 per cent schedule,
and it is only fair that in a business like agriculture where we are producing so much of Canada's exports, and where we cannot take advantage of a protective tariff, we should have consideration in this respect.
I notice the hon. member for South Wellington (Mr. Guthrie) gave the price of the Massey-Harris binder, eight-foot, at $288. That might be so in eastern Canada, but in the west we pay $325 for the same machine. To give the house an idea how prices have risen in western Canada, I might point out that the same type of machine could be bought seventeen years ago for $165 to $170, whereas to-day we are paying $325 for it.
While I am making reference to grain I should like to say a few words regarding some trouble we have been having lately with the Board of Grain Commissioners. Hon. members know full well that some little time ago an amendment was passed to the Grain Act known as the "Campbell" amendment, the purport of which was to enable the farmer to consign his grain in carload lots to a terminal elevator of his own choice. If this amendment had been carried out in the spirit in which it was passed, the pool elevatot terminals would have received in a normal way more than 50 per cent of the grain oi the country; but owing to outside grain interests bringing out what we usually term a "hybrid" ticket, and this being permitted by the grain commission, a very large quantity of grain has been diverted from its proper and intended channel to other terminal elevators. It has been suggested that amendments might be made to the Canada Grain Act, but what is the use of making more amendments to the act unless we enforce the act as it stands at present? We need amendments, but if whatever amendments we pass are not enforced better than the present Grain Act is, it is useless passing them. I would therefore request that the government at the earliest possible moment see that the Grain Act is carried out as it was intended; otherwise they should find a new board to look after it.
I should like to say a word with regard to this last year's crop in western Canada. There seems to be very little known in eastern Canada of the unfortunate set-back we had in the west during 1928 owing to the effect of frost and some hail. It was very unfortunate that a good deal of idle boasting was done by misinformed people-not by people on the land. This misinformation had the effect of lowering the price of grain. Canada as a whole will suffer through the partial failure of the crop, and there is no doubt that in twelve months, business throughout Canada will feel it.
The Budget-Mr. Spencer

I notice that the Minister of Finance, during his budget speech, made this statement:
Our dollar is no longer at a depreciated value.
I should like to remind him that a slightly depreciated currency is sometimes a good thing; that exports can always be sent more readily from a country with a slightly depreciated currency. Moreover, if the money is too dear, it is all the easier for goods from outside to enter. We are in a peculiar situation with regard to Germany, a country that was our main enemy during the war and was defeated. One would think she would be on her knees, but we find through her manipulation of her currency-and I am not supporting that manipulation-the situation to-day is that Germany has a per capita debt of $8.67 as against Canada's per capita debt of $246.64.
I well remember a few sessions ago the consideration being given in the house to the building of several ships for our West Indian tmde, and it was found out at the time, that if Ihose boats had been built in Germany instead of in Canada, we could have secured them at half the price. This alone shows that we should pay more attention to how to handle our own credit, and that it is not always safe to consider you are in the very best position possible just because your dollar happens to be at par.
Another statement made by the Minister of Finance was as follows:
As the years go by an increase in quantity of our domestic production must necessarily be marketed abroad.
What does he mean by this? Does he mean that as the years go by we must have more and more of our goods sent to other countries and not receive anything in return? On the other hand, does he mean that if we export more and more, as I hope we shall, we shall naturally have to receive more and more goods and services in return? That is the only way in which we can trade. If he does not mean that; if he means we are going to send something away and not get anything in return, I am afraid his argument will not hold water. I claim that all countries must consume the money value of their total production, allowing, of course, for all natural exchange of goods and services. If we are not doing that, there is certainly something wrong with our economics.
I am glad to see the slight reduction in the tariff and the benefit that will accrue to the mining and fishing industries. I should like to have seen more attention paid to agriculture, and to the rank and file of the people in the way of cutting down the tariffs on not only 
boots and shoes, but woollen underwear, something that is so essential in this country.
I know the Minister of Finance wants to get the feeling of the people across the Dominion of Canada, and therefore I am going to read a short resolution passed by the United Farmers of Alberta at their convention this year:
Whereas the farmers of Alberta have to sell their produce in a world market and at the export price, and whereas their purchases are made in a restricted and protected market, therefore be it resolved that this convention go on record in favour of the principle of world free trade, and in the meantime, support the general policy of substantial reduction in the tariff.
I want to say that I appreciate the abolition of the nuisance taxes. It is true that, directly, the poor man will not benefit very much, but I am against the system of nuisance taxes because they interfere with business. I would much rather have the income tax increased-and would of course pay it myself when I had an income to call for it-than to be bothered with a lot of small nuisance taxes.
I am also glad of the altered tax on sales and transfer of shares, and hope to see this idea developed.
A further statement from the Minister of Finance is "that the administration will refuse to support any extravagance in the spending of the taxpayers' money." That, of course, I heard with a good deal of amusement, Mr. Speaker, considering some of the items that passed through this house last year. I might mention, for instance, the item in the estimates-which was ultimately cut down, I think, from $300,000 to $100,000-for dredging at the island of Anticosti. I would also refer to an item of $231,178 for equipping and furnishing of the citadel at Quebec, a vote which was challenged in this house and was carried by a majority of only eight votes. I would also point to what I consider the unwarrantable expenditures last year at the harbour of Quebec.
I wish to say a few words, Mr. Speaker, in support of the tariff advisory board. The principle of the tariff advisory board is, I think, perfectly sound. It has been criticized as being simply a buffer between those who want protection and the Finance minister. But even if it is nothing more than a buffer I should be in favour of it, because I do not think we have a right to expect any finance minister, whether of the Conservative party, the Liberal party, or the Progressive party, to stand the tremendous pressure that must have been put upon finance ministers

The Budget-Mr. Lawson
in past years, before the budgets were brought down, by those wishing special favours under a protective tariff. But to-day we have something better; we have hearings before a public commission so that those who are opposed to requests made by different corporations have a perfect right to appear and submit their arguments in support of their claims.
Now, Mr. Speaker, I come to the last phase of my address. We have heard a great deal during this discussion with regard to the possibility of interference with our trade by what the American congress might do. Some hon. members have advocated, particularly those directly to the left of the Speaker, that we should have a special session or give power to the government to raise our tariff in case the tariff is raised by the United States against us. The government, on the other hand, has taken a position of watchful waiting. I am going to suggest, Mr. Speaker, a third way. I think it would be foolishness itself to attempt to carry on an economic warfare with the United States. We are just as liable to be as unevenly matched as though. we tried to meet them on military grounds. But we have other means. We have to recognize, and they must recognize, that we are one of their best customers. If they do not want us to trade with them, we do not have to trade with them. We can turn our attention in other directions, and I am going to point to two directions only, although there are many. I am going to point, first of all, to Russia, a country of immense potential markets; a country, I might say, to which a delegation of British industries is going, to investigate for themselves conditions there, with the one idea of creating a greater trade between Great Britain and that country. I have not yet seen a real reason why the Dominion government broke off negotiations with Russia when they did, and I only hope that when the Prime Minister speaks in this debate he will state to the house that so far as the government are concerned they are again prepared to recognize that country.
The other channel in which I think we might develop tremendous trade is that of Great Britain. I strongly urge the view that if we are turned off from a market in one direction we can open markets in the other, by enlarging the British preferential tariff. Great Britain takes enormous quantities of our exports, so why not give them an opportunity of sending us their goods in return?
As my time is coming to a close, Mr. Speaker, and not wishing to break the rules of the house, in support of my belief that we
should enlarge our preference for trade with Great Britain, I beg to move a subamendment, seconded by Mr. Heaps:
That the amendment be amended by striking out all the words after "house" and substituting therefor the following:
"urges upon the government the consideration of an immediate and substantial increase of the British preference as a step towards freer trade relations between Canada and other nations."


Mr. J. E. LAWSON (West York):: Mr. Speaker, as I was so fortunate as to be elected a member of this House of Commons by acclamation, I shall not regale the ministry with recriminations as to election pledges. They, in their collective wisdom, deemed it advisable not to create the necessity of mak mg promises in the constituency of Wes York.
In this, my first utterance in this chambei, I desire to advance a plea on behalf of the vegetable growers, of West York in particular and of the Dominion of Canada in general. I am inspired to that subject by the hope that the government will justify, by action, the policy enunciated on its behalf by the Minister of Finance (Mr. Robb) in his budget address to this house when he said, referring to the government:
Its policy is to encourage production at home and the marketing of our excess of production abroad.
Under normal conditions the vegetable growers of Canada require no assistance from the government, but when there is a surplus of production in the country to the south then some protection is required for our home market. Climatic conditions do not respect international boundaries, and it must be borne in mind that we are on the northern fringe of the. vegetable-growing belt of the North American continent. The normal movement of the vegetable products is from south to north. In the most southerly states the crop-let me take, for example, tomatoes-ripens about the middle of April, and the vegetable growers obtain for the first tomatoes they put upon the market, we will say, eight dollars a bushe^ a little later on seven dollars a bushel, and a little later still six dollars a bushel, until such time as they have obtained a return which covers the cost of production plus a reasonable profit. In years of plenty they still have several hundred bushels of tomatoes in thei' fields, on which, if they can realize the cost of picking and shipping, plus the freight rate, they are that much better off. So they pick this crop and start it "rolling" as it is termed in the trade. They have not found a market
The Budget-Mr. Lawson

for it, they have not even arranged a sale. The crop is started rolling north, and the commission agents along the line are wired to dispose of the commodity at whatever price they can obtain to cover the freight rate and the other costs. So just at the time when the vegetable growers of Ontario have their product ready for the market it is glutted with the surplus crop from the south. Hence the home market is destroyed, and in some cases our tomatoes are left to rot in the field.
Year after year since this government has been in power nothing has been done to preserve the home market, and yet its avowed policy is "to encourage production at home and the marketing of our excess of production abroad." I know some hon. gentlemen will say that if a certain amount of protection is given to the home market you prevent the public from profiting by the bargain prices which sometimes prevail. If the allegation is that this is a temporary condition, I wili not attempt to deny it. But what do we find? When our market is glutted with an excess of American production our vegetable growers decrease their plantings the next year. The result is that in time the home market is lost, and just as soon as that happens those who advocate the doctrine that I have referred to will find that no longer will the surplus from the south be started "rolling"; it will be sold in Canada at a fixed price, and our consumers will not in any way benefit.
Let me take the alternative suggestion: Assuming that our market is adequately protected, what will happen? If our vegetable growers find that this year they have a good home market, then next year they increase their plantings, and by virtue of that their cost of production is reduced, the ratio of profit which they require can be spread over a much larger field, and in the long run the consumer in Canada, although at times he will lose a bargain price, will get lower maximum prices at other seasons of the year. In that way a safe, sound and stable home market will be preserved for our home grown products.
It seems to me, Mr. Speaker, that we have a selfish as well as a public interest in maintaining such a market. I find surrounding all the large centres of population in this country great numbers of returned soldiers who have settled upon the land. In appreciation of the services which they rendered Canada we placed legislation upon the statute books to assist their reestablishment in civil life. I find that in the province of Ontario alone the Soldier Settlement Board has for this purpose advanced $9,367,062, thousands of dollars of which are loaned right in the constituency of

West York, which is contiguous to the city of Toronto. Those loans bear interest at five per cent, amortized and repayable in twenty-five years. Surely as business men charged with the administration of the public affairs and the public funds, we axe desirous of creating and preserving a home market for our vegetable growers, so that those men may be provided with the wherewithal to repay their loans.
Our present tariff is wholly inadequate for this purpose. With one exception, I think potatoes, we have an ad valorem tariff varying in percentage, but-to continue my illustration -the rate on tomatoes is fixed at 30 per cent. May I ask hon. gentlemen what is the advantage of an ad' valorem duty of 30 per cent, when that duty is imposed at the point of shipment and not at the point of entry, and when the tomatoes to which I have referred may be selling at fifty cents a bushel in the far southern states from which they have been started rolling? Such an ad valorem duty will not preserve our home market, and yet the policy of the government, as enunciated by the Minister of Finance, is to encourage production at home and the marketing of our excess of production abroad.
Now, sir, I would feel that I had been remiss if I did not suggest a remedy. The remedy required to preserve the home market for our vegetable growers is a seasonal specific duty of so many cents per unit of any particular commodity. This suggestion is not original; I believe some thirteen countries of the world have such a seasonal specific duty in force to-day. The Advisory Tariff Board, to which the hon. gentleman who preceded me (Mr. Spencer) referred, had a hearing of the vegetable growers and horticulturists of Ontario on December 16 and 17, 1926; they had a second hearing on February 22, 1927, and a third hearing on December 8 of the same year. I find on referring to the estimates that this tariff board costs us $120,000 a year for maintenance; it pays $71,000 a year for advisers, a total of $191,000, in order that, having been advised by their advisers, they may in turn advise -the Minister of Finance, and yet they have allowed fifteen months to elapse without rendering any such advice following those hearings. Or if they have rendered any advice to the minister then he has failed to advise the market gardeners of this country what they may expect in the way of protection for their home market in the year to come. And yet the policy of this government is "to encourage production at home and the marketing of our excess of production abroad." I wonder if, while there

The Budget-Mr. Letellier de St. Just
is yet time, the government will justify by action that policy which the Minister of Finance enunciates, or leave it merely as a euphonious phrase for the consumption of those who, apparently in the opinion of this government, are the gullible electorate of Canada.
Mr. J. E. LETELLIER DE ST. JUST (Com.pbon): It is a great pleasure to me Mr. Speaker, to rise at this time to express my views on the present budget, and I wish to extend my heartiest congratulations to the Minister of Finance (Mir. Robb), on his ability in .the success obtained on realizing such, an important result. The people of Canada welcomed Last year's 'budget, which caused great ioy and brought about the largest sale of certain classes of goods resulting in great benefit to the people of this country. The expectation of the people, this year, was for a further reduction of the sales tax. Surely they have not been deceived when we contemplate a reduction of the net debt in 1928-29 of $69,782,000. From the beginning .of the fiscal year 1923-24 to the end of the present fiscal year, the net debt has annually decreased, the total reduction in the six-year period amounting to about $226,708,000, or a yearly average reduction of some $37,700,000.
It is evident that the people of Canada are not all satisfied with the budget, but it seems fair to say that the great majority of Canadians know very well that, with the conditions that the King government had to face during the past years, it would have been impossible for any finance minister to satisfy everybody. I am more than delighted to concur with the minister and to give him all my approbation when I realize the influential support he receives from the most important business associations and boards of trade of Canada. These associations comprise a large membership. I do not believe I am mistaken in saying that there are more than 100,000 merchants who are distributing over $4,000,000,000 worth of goods each year, or an average of approximately $421 per capita; and they are satisfied to proclaim that there is great prosperity in the country, in that the distribution of goods in the year 1900 as compared with the present would be about as 3 is to 5. This will be nearly enough a correct calculation, without considering the increased needs of the public. The value of the goods distributed in 1900 would have been only $2,400,000,000 if we had our present population, but as we had then over 5,000,000 people as compared with 9,500,000 to-day, we have to reduce the amount of goods consumed by the relative proportion of population. On that basis the
value of the goods distributed in 1900, amounted to approximately $1,400,000,000 as compared with $4,000,000,000 to-day. This shows the growth of distribution with the progress of other development in Canada during the past twenty^five years, and yet there are people who criticize the government, proclaiming that there is no such prosperity existing in Canada. The widely prevalent belief, Mr. Speaker, that Canada is entirely dependent upon capital from outside sources to finance her development is rudely dissipated by the disclosure that the Dominion is exporting more capital than she is importing, and has been doing so for the past four years. Canada has always had considerable investments abroad in the form of banking .balances in London and New York, railway lines in the United States, and investments in foreign securities by banks and insurance companies as well as by private individual who require well diversified lists of securities. A rising Canadian prosperity, however, with a greater volume of funds seeking investment outlet, has resulted in a situation where the capital to leave the country exceeds by a substantial marign that coming in.
In 1925 the figures of Canada's capital exports over capital imports in round millions were $150,000,000; in 1926, $90,000,000; in 1927, $30,000,000; and in 1928, $25,000,000. The decline in these figures for the last two years is explained by a growing Canadian interest in domestic securities. An increasing absorption of Canada's part of her own bond issues has been a feature of the past few years. In both 1927 and 1928 the Dominion accounted for roughly 50 per cent of the total bond sales, in the former year exceeding the purchases of these issues by the United States. In 1925 Canada had even an export balance in capital with the United States, and in each of the last three years Canadian capital account with the republic has practically balanced.
After careful compilations Canadian investment abroad in 1928 is placed by the Financial Post at $177,000,000, as compared with $207,000,000 in the previous year. Of the 1928 total $112,000,000 went to the United States, $63,000,000 to other foreign countries, and $2,000,000 to the United Kingdom. Taking into account the decreases in government and bank balances due to the expansion of business at home a net new investment of $157,500,000 is left as against a net of $184,000,000 in 1927, and after deducting $11,000,000 from this account and $35,000,000 from other countries, we have a net increase .of $59,500,000. A deduction of $5,000,000 in government and bank balances from the total goinig to the United Kingdom results in a
972	COMMONS
The Budget-Mr. Letellier de St. Just
net loss of $3,000,000 in new Canadian investment in that country. Based on figures issued by the Dominion Bureau of Statistics as of January 1, 1927, careful estimates made upon information from most reliable sources by the same authority give the total of Canadian investments abroad on January 1, 1928, at $1,514,500,000 and on January 1, 1929, at $1,672,000,000. Of this total at the opening of the present year Canada had $939,000,000 invested in the United States, $112,500,000 in the United Kingdom, and $620,500,000 in other countries.
This survey furnishes further proof of Canada's advance among the creditor countries of the world as a factor in international finance, with capital furthering industrial developments of many kinds in many distant parts. Investments by Canadian insurance companies in diversified foreign securities continue to increase rapidly with the development of both their domestic and foreign business. Direct Canadian investments in branch plants in the United States commercial field and elsewhere are growing steadily. Canadian holdings of New York stocks and of European and South American government bonds have increased enormously, and altogether the record testifies most eloquently to Canadian prosperity and world progress:
Canadian Investments Abroad
1927	1928
British	$118,479,000	$112,500,000United States	723,328,000	939,000,000Other countries.. ..	488,779,000	620,500,000Total	$1,330,586,000 $1,672,000,000
Now, Mr. Speaker, I pass to the agricultural industry, and with great pleasure and true spirit I say that since the beginning of the year 1922, when the present administration assumed office, many new policies have beep introduced and developed by the federal Department of Agriculture with a view tc increasing agricultural production, and many of these policies have had no small part in bringing about the present prosperity which Canadian -agriculture enjoys. These new policies have naturally involved greater expenditure on agriculture on the part of the federal government and the employment of a greater number of agricultural workers, but this expenditure has been more -than justified by the increase of out agricultural wealth and in our agricultural revenue which can be traced, directly or indirectly, to those new agricultural -activities. In dealing with these new activities probably it will be well to follow the organization of the department and discuss it very briefly, branch by branch.
[Mr. Letellier de St. Just.l
As the Dominion experimental farms provide the basis for the working out and the demonstration of problems dealing with Canadian agriculture in all its -phases, new activities on these farms naturally must have a most important effect over a wide area. During the seven-year period under -consideration this organization has grown in size, volume of agricultural research and -practical aid to the farmer to a degree greater than any previous fifteen-year -period in its history. I wish to take the opportunity of expressing my appreciation to the Lennoxville experimental farm, by which the farmers of the eastern townships district, have acquired considerable knowledge through the activities of the active superintendent, Mr. McClary. Many contests have been held there; many old and young farmers have received most important lessons in judging milch -cows, and greater interest has been fostered by the establishment of this policy. I have been personally taking a great interest in this special work of helping boys' and girls' clubs in their work in connection with cattle, sheep and swine in my constituency, and I am more than -pleased to mention to the members of this house that I was greatly honoured during the course of the year 1927-28 through the members of the young breeders' clubs of the following places obtaining the best classification with their milch herds at the great eastern township exhibition held at Sherbrooke lu 1927 and 1928: Compton, Waterville, Bury, Bulwer, Sawyervil-le, St. Hermenegilde, St. Hedwidge, East Hereford, St. Malo. The hon. member for Sherbrooke, (Mr. Howard) has taken a great interest in the farmers, and he was a witness of this event. Great progress has been noticed since the federal department stated its -calf club work in 1923. The encouragement given to the younger generation and the interest fostered among them by these club activities has been reflected in the marked improvement in live stock production in the districts in which clubs have been organized. I hope the department will continue to give assistance to these organized clubs and develop new efforts through their agronomist in urging new -clubs to cooperate with the provincial government.
I desire also to voice my appreciation of the dairy and cold storage branch. The two main lines of endeavour inaugurated by this branch since 1922 have been that of dairy *produce grading and the inception of dairy research work. The dairy produce grading has resulted in a great improvement in quality, while thp -publicity given to that quality through the grading records has brought about a new attitude on the part of

The Budget-Mr. Letellier de St. Just
producers and manufacturers. The grading has facilitated the trade in dairy produce and increased the good will shown toward Canadian dairy produce in the markets of the world; the increased premium which Canadian cheese now receives on the British market is due very largely to this grading system. Not only on the export markets, but also on the domestic markets has the improvement in the quality of our butter and cheese been marked. The Canadian housewife can now be more reasonably sure of the quality of the dairy products which she purchases. The investigations of the dairy research division have enabled the butter makers and cheese makers to correct some serious defects in the quality of their butter and cheese. Through the elimination of losses considerable profit has been added to the proceeds received from this industry.
The estimated value of the cheese and butter produced in the province of Quebec during 1928 is $30,098,541. This represents a total production of 1,452 factories in the province, as per the reports made by the inspectors at those provinces. This number is made up of 678 butter factories, 537 cheese factories and 238 combined factories, and constitutes an increase of three factories as compared with the number operating in 1927. The production of 721,924 cows was used in these factories. The production of a number of cows was used to produce butter for consumption in a few cities. The number of cows producing for these factories in 1927 was 679,119, so the 1928 figure shows an increase of 42,175 cows. The number of pounds of butter manufactured was 54,904,046 pounds as compared with 55,098,768 pounds during the preceding year, a decrease of 194,722 pounds. The total output of cheese was 44,326,885 pounds as compared with 37,510,737 pounds during the preceding year, an increase of 6,816,148. The minimum price per pound received for butter during 1928 was 37.9 cents, and the price received for cheese was 20.9 cents. This represents an increase of 12 cents per pound for butter and 28 cents per pound for cheese, as compared with the prices received during the previous year. The sale value of the butter produced by the factories in 1928 was $20,832,898 as compared with $21,216,505 during the preceding year, an increase in value of $616,393. The sale value of cheese produced amounted to $9,265,643, as compared with $6,805,658 in 1927, or an increase of S2,459,985. These figures were submitted by the inspectors and were sent directly to the provincial agriculture department, and therefore might be subject to some revision.
The work of bovine tuberculosis eradication through the restricted areas has been and is of incalculable advantage to Canada's stockmen and to Canadian citizens generally. It means more profitable herds and healthier people. There are now about 1,000.000 cattle under this system, and the related policies of accredited herds and municipal testing. The most effective method for the control of bovine tuberculosis so far is that of eradication by slaughter of reactors. This work is carried out in definite areas under the restricted area policy put into operation in 1922. Since that time over 700,000 cattle have been, tested in the nine areas already established or in process of establishment.
I should like to mention a few details about the sheep industry, which is one of the most important industries in Canada. During 1928 Canada added 153,082 sheep to her flocks, the increases over the previous year being 4-6 per cent. Every province, without exception, added to its sheep holdings. Ontario, in which approximately 53 per cent of the sheep of the Dominion are to be found, increased its sheep population by 57,839, or more than 6 per cent, while British Columbia added 40,064, or nearly 33 per cent. Other increments ranged from 5,000 in Alberta to 13,060 in Saskatchewan. The relative standing of the various provinces in the middle of the year was as follows:
Province
Ontario	
Quebec	
Alberta	
Nova Scotia	
Saskatchewan	
British Columbia.. .. New Brunswick.. ..
Manitoba	
Prince Edward Island
Number of sheep ..	1,014,106
..	863,757
..	515,000
..	270,461
..	183,098
..	169,057
. .	160,514
..	144,713
..	97,082
The related wool clip of 1928 discloses a pleasing progress in this industry. An increase of more than 5 per cent is shown in the volume of the Dominion clip, in which increment every province without exception shared. The total Canadian clip is estimated
at 19,611,430 pounds, worth $5,099,000, as compared with 18,672,766 pounds worth $4,108,000 in 1927. The following are the figures for the various provinces in order of importance for
1928 and 1927:
	1928	1927
Province	Pounds	PoundsOntario	5,677,088	5,326,651Quebec	4.969,126	4.956,418Alberta	3,116,609	3,033,181Nova Scotia	1,535,462	1,480,541Saskatchewan	1,064,608	987,458British. Columbia ..	973,400	717,892New Brunswick	916,007	873,724Manitoba	801,468	765,609Prince Edward Island.	549,675	513,882Indian reserves.. ..	17,987	17,410974	COMMONS
The Budget-Mr. Letellier de St. Just
A large number of my farmer constituents are greatly interested in the development of their flocks.
Another important factor which has contributed to the progress and development of poultry breeding is the effort made by the Department of Agriculture in organizing the holding of the World's Poultry Congress in Ottawa in 1927, which undoubtedly had a tremendous effect in stimulating the Canadian poultry industry, and at which Canada, and especially Ontario and Quebec, held first rank among the many countries which exhibited.
In conclusion, I should like to direct the attention of the government to the many colonization lots which are available in my constituency. The soil of these lots is of the most fertile nature, and I wish to impress upon the Prime Minister (Mr. Mackenzie King), the Minister of Immigration and Colonization (Mr. Forke) and their colleagues the other members of the cabinet, the importance of giving consideration to colonization bill No. 16, which was introduced in 1926 but which, on account of the dissolution of parliament at that time, did not become law. I believe this bill could be redrafted so as to help a certain class of labourers who are actually working in mills and factories, but many of whom have been brought up on farms and with a little help of this nature would be willing to take up some of those lots and make them profitable for themselves and the country. I have also received requests from parents having as many as four young men in the family who are just at the proper age to do splendid work on farms and who, if they were protected by such a law, would be willing to purchase some of these lots. If this legislation were passed it would promote great interest amongst labourers who have children of age to help them while they were getting established on the land, and later on these children could establish themselves on farms of their own where I should think they could do splendidly. At the same time it would prevent emigration and induce many Canadians to return to farming, a consummation which would be of the greatest benefit to our national life.


Mr. F. W. GERSHAW (Medicine Hat):: Mr. Speaker, in rising to make a few observations on the budget, I must first of all say that I believe the financial statement of the Minister of Finance (Mr. Robb) has been well received from coast to coast. In this house, however, it has met with two amendments. The acting leader of the opposition (Mr. Guthrie) presented an amendment for the party to your left, Mr. Speaker. True 
to form, they regret that the financial proposals of the government make no provision for reasonably safeguarding and protecting the interests of those engaged in agricultural pursuits and in industrial employment in Canada. Then we have to-night an amendment by the hon. member for Battle River (Mr. Spencer), which calls for an increase of the British preference.
It would thus seem, Mr. Speaker, that the government is faced with two votes of want of confidence, first, because they have not more adequately protected the interests of Canada, and secondly, because they have not extended the preference more widely throughout the British Empire. Of course, we must have a tariff against non-preferred countries or we cannot extend a preference, and it seems to me, Mr. Speaker, that this government has fairly steadily and consistently been making trade treaties to increase our trade throughout the empire. Trade treaties have been made with the United Kingdom, with Australia, New Zealand, South Africa and the West Indies, and I hardly see that they are open to a vote of censure because they have not acted energetically enough in that regard.
Now, Mr. Speaker, owing to the widespread circulation of the press, and the news which is broadcast by radio, the people to-day are well informed, and I believe that the people of the rural districts are particularly well informed as to the conditions confronting the country at the present time. They have heard -and they have been watching with some anxiety-the news that is coming across the border from the United States. Hon. members here argue that we have nothing to fear from this source. I can hardly agree with that. Our markets suffered some years ago when the Fordney tariff was placed against our cattle going into that country, and already the rumour of a further increase in that particular duty has done much damage to the cattle industry in the west. I believe that definite and considered action will have to be taken, by negotiation and by dealings with countries who will deal with us, but I believe that the real thinking people of Canada wilt deprecate any attempt to work up an unfriendly feeling with our great neighbour to the south.
The first police barracks, Mr. Speaker, of the royal northwest mounted police were located in the Cypress hills south of Medicine Hat. From there, these pioneers of police forces in Canada, and from other bases, policed the country during the early days. They overcame great difficulties, and they were undaunted by the dangers which beset

The Budget-Mr. Gershau)
them on every hand. Many of those pioneers have, through sickness and old age, been retired, and the pensions which they are receiving at the present time are altogether inadequate to compensate them for the services which they have rendered. I have in mind one brilliant police officer who rose from the ranks to be a superintendent of the police. He died and left a widow and two minor children. The pension she receives brings her below the poverty level, amounting to only S45 or $48 per month, and that, Mr. Speaker, you will agree, is altogether inadequate when we take into consideration the cost of living to-day. The pensioners of the Great war have fared fairly well in Canada. Canada has perhaps done more for her returned soldiers, and her disabled soldiers, than any other country engaged in the Great war. It is true that some are breaking down now, and some deserving cases do not come under the provisions of the act. But on the whole they have fared fairly well. The amount spent by Canada in pensions comes to $42,000,000 a year. As time goes on, more and more will require to be spent, but at this time, Mr. Speaker, I would like to urge the Minister of Justice (Mr. Lapointe) to reconsider the pensions which the veterans of the royal northwest mounted police force are receiving.
Now, Mr. Speaker, there has been much debate as to the capital debt of Canada. We find, however, that the leaders are fairly well agreed that the capital debt is about two and a quarter billion dollars. Mr. R. A. Daly, president of the Investment Bankers' Association, at the eleventh annual convention, proposed that the debt could be retired in forty years if $23,447,000 were taken off it each year, if this amount per annum, said Mr. Daly, would represent the minimum amount to be retired each year. And, as this amount is no bigger than the average amount of debt that has been retired in each of the last four years, it is apparent the plan is perfectly feasible, especially when we consider that we are now running into a much more prosperous period. Perhaps it will not always be possible, Mr. Speaker, to reduce the debt by the same amount. When revenues are high, such as they have been during the past year, a larger amount of debt might be paid off, and if bad years should come, a smaller amount could be paid off.
There has been a good deal of discussion in this house, Mr. Speaker, as to what prosperity is, and I have a clipping here from a western farm journal, The U.F.A., dealing with that:
What is prosperity? The people of the United States have it in abundance, according
to aggregate statistics, yet James J. Davis, United States Secretary of Labour states that eighty-six per cent of Americans are poor. Figures compiled by the federal trade commissioner at Washington show that one per cent of the people own fifty-nine per cent of the country's wealth; thirteen per cent own ninety per cent of the country's wealth, while eighty-seven per cent of the population own ten per cent. Startling inequalities of this character are not confined to the United States. British statistics are also very impressive. And in Canada there is exactly the same tendency at work as elsewhere. We are certainly not in a position to give thanks that "we are not as these others". We have no just grounds for national self-complacency, even though inequality may not have reached such extremes in this country as yet as in some of the older commercial regions of the world.
And then I would like to add, Mr. Speaker, that Adam Smith recognized the principles that citizens paying into the public treasury should be taxed according to their ability to bear taxation; and surely in a civilization where the gulf between the average citizen and that of the comparative few who amass large fortunes is constantly widening, the larger fortunes should bear the larger portion of the taxation. I think this is particularly fitting to have on Hansard just at this time when the Finance minister has not reduced the income tax. This year $58,000,000 was derived from the income tax, and the people of Canada will not object to the minister retaining this tax. Those who are paying it are gaining most by the present good times. There are grounds for objecting to the double taxation, but it must be remembered that any incomes doubly taxed are derived from investments; incomes from salary are not so taxed. The present exemptions are so generous that the tax does not bear heavily on the wage-earner with a family.
I believe, Mr. Speaker, that the greatest dissatisfaction in the west at the present time is in connection with the grain grading system. The producer feels that he is not getting the full value for his crop. One inspector may grade a sample No. 3, another inspector may grade it No. 4, and the same inspector may grade the same sample differently at different times, with the result that the man whose grain just misses getting into No. 4 has to take a discount of 17 cents in grade. I am very glad that the whole matter has been referred to the agriculture committee, and I hope some workable scheme will be developed so that this injustice will be discontinued.
Harvesting and threshing combines are being more and more used throughout the west, and if the Minister of Finance could see his way clear, as urged by the hon. member for Last Mountain (Mr. Fansher) to
The Budget-Mr. Gershaw

classify swathers and combines so that they will come in under the six per cent rather than under the ten per cent duty, his action would be very much appreciated.
May I, sir, draw the attention of the house to some of the conditions that exist in the so-called dry belt? In times gone by the settlers there suffered great distress, and many of them had to move out of the district. But experience and better methods of farming have made it possible for nearly all the remaining settlers to make a good living. There are, however, certain difficulties in the way of progress, and I hope this parliament will be able to correct some of them. Last session legislation was passed making it possible for a man to file on a second homestead. In the district called A, south of township 16, in the provinces of Alberta and Saskatchewan, no outsider was allowed to file on a homestead. This turned out to be a wise provision, for if a number of inexperienced homesteaders came in, and there was a return of the dry years, we would have a repetition of all the suffering and poverty and privation that prevailed in the past. At the same time provision was made to encourage those who had remained in the district to obtain more land, and from the handbook issued by tire Dominion government I desire to quote the following with respect to area A:
Lands south of the south boundary of township 16, in the provinces of Satkatchewan and Alberta, are open only for entry to a person who submits evidence satisfactory to the Minister of the Interior that he or she is in permanent residence and conducting farming operations upon a farm of not less than eighty acres and not more than nine miles distant from the proposed homestead.
This second homestead could be taken up by such a person or by his father, mother, son, daughter, brother or sister. The act has been extended to include some other relatives. Unfortunately when the farmer's son or some other close relative applied for one of these available homesteads he found many difficulties. First of all. he had to assume responsibility for all relief seed grain liens, improvements, or other debts contracted and standing against the land in the books at Edmonton or at Ottawa. These debts were contracted by the first settler who had abandoned the homestead, but the relative of the resident who took over the holding must assume all those liabilities. True, he may pay off the indebtedness by instalments, but the interest compounded at seven per cent is mounting up all the time. The joint board of representatives of the Dominion and provincial governments may make a reduction,

but the prospective settler has no assurance that this wifi be done. Some of these homesteads have three, four, or five hundred dollars against them, and in certain cases the indebtedness runs as high as a thousand dollars. This is most discouraging to the youth born in the district who wishes to make his home close to his relatives. The case in regard to preemptions is evbn worse, as the interest piles up to such an extent during the bad years that many deserving men and women find it impossible to retain holdings that they need so badly. Why should the department charge se'ven per cent interest when they borrow the money at five per cent or less? Let me give the house a few examples of how burdensome this interest becomes. The original price of one quarter section was $456, interest $361, making the present price $817; in another case the same condition obtains, while in a third case the original price of $477 is swollen by interest charges of $284. The farmer under such circumstances finds it impossible to finance his undertaking. The government and parliament of 1910 to 1913 encouraged the people to settle in that district. Those who did so were lacking in the experience necessary to make the venture a success. They made their homes there without warning or advice from qualified persons, and without any supervision. Therefore I submit that parliament should do something to remedy these unfair conditions. Debts due to the crown cannot be reduced by the minister or by any member of his department, nor even by the governor in council. This relief can be effected only by an act of parliament, and I hope that if in the near future the minister sees his way clear to introduce legislation to remedy the evil, every hon. member will support it! If even the accumulated interest could be cancelled or reduced it would bring great hope and encouragement to the people of that large district, and the development which would follow would help also the urban centres. The progress of any town or city depends to a great extent on the prosperity of the surrounding country, and when one large district, namely, the Tilley East area, is virtually not developing at all, and another large district, area A, in that southern country is struggling under suoh a handicap, city progress must necessarily be slow.


Mr. BRADY:: Mr. Speaker, I beg to move the adjournment of the debate.


Some hon. MEMBERS:: No, no.
97?

The Budget-Mr. McKenzie


Mr. ROBERT McKENZIE (Assiniboia):: It is my intention to take up but a few minutes of the time of the house to make a few observations with regard to the budget. In the first place I would congratulate the Minister of Finance (Mr. Robb) on again bringing to the house a satisfactory budget, the sixth that he has brought down, showing a surplus and a reduction in the national debt as well as a reduction in taxation. The national debt has again been very substantially reduced, and there is also a reduction in the taxes which are oollected from the people. Yet in spite of this, we have an amendment moved by the hon. member for South Wellington (Mr. Guthrie) to the effect that:
This house regrets that the financial proposals of the government make no provision for reasonably safeguarding and protecting the interests of those "engaged in agricultural pursuits or in industrial" employment in Canada.
We who come from the farming areas know quite well that it is impossible for any government to impose tariffs which will in any way safeguard the agricultural interests. We know that up to the present time there has been no purely farmers' organization which has put itself on record as being in favour of increased tariffs on their products. The United States has been pointed out to us as an example, but our farmers are wise enough to regard the United States rather as a warning than as an example to be followed. I do not think this government would be well advised to take any notice of the talk about retaliation because of anything which the United States may possibly do.
We have heard from the hon. member for South Wellington something about the increase in expenditures being out of proportion to the increase in the business of the country. In this connection I would suggest that the business of this country is run, after all, on the same principle as and only on a larger scale than is the business of any of the smaller organizations, such as the provinces, our municipal institutions and so forth. We know that during the later years of the war and the few years following we were not spending a great deal of money in keeping our buildings and other property fully up to their usual state of repair. Hon. members here who own property know that in spite of all they were able to do their property depreciated in value owing to the fact that they were not in a position to maintain repairs. Now the Dominion of Canada, when the Prime Minister (Mr. Mackenzie King) took charge in 1921, was in the same demoralized stale, and since the year 1921 it has been necessary in some cases to increase expenditures in order to re-78534-62	[DOT]
store public property to a proper state of repair, just as was the case in private businesses.
We have heard a good deal from the opposition in regard to the loss of population; we are told that our people have gone in great numbers to the United States. This, we know, is a fact. I was reading a few days ago in a magazine, an article giving statistics in connection with the United States which went on to show that two-thirds of the citizens of that country who have permanently left the United States are living in Canada, and while it is true that they are getting many of our citizens, it is also true that we are getting a great many people from the United States. After all, is it not only natural that two countries side by side should have a large interchange of citizens? This has always been so. There has always been an exodus from one country to the other, but there has also been the reverse movement. I would point out, however, that the greatest exodus that has been known, in my time at any rate, began when our hon. friends opposite were in power, around the years 1919, 1920 and 1921; and it took considerable time to overcome that.


Mr. ROWE:: You have not overcome it
yet.


Robert McKenzie: Yes; read the statistics and you will find that it has been overcome.
It is not my intention to dwell at any length on the budget; anything I might say would be but a repetition of what has already been said. I desire, however, to take just a little time to mention one item in particular and to point out the effect which a reduction in the tariff will have in the constituency I represent. At page 595 of Hansard, March 1, the Minister of Finance in his speech stated:
The resolutions now submitted provide for a revision of certain tariff items of particular interest to the mining industry. In accordance with the traditional policy of assisting the development of our basic industries, the rates of duty on certain machinery and equipment used in the mining industry have been reduced.
We had the pleasure of hearing a very fine address from the hon. member for Nipissing (Mr. Lapierre) with regard to the metal mining industry. The only mining industry about which I am concerned, so far as the constituency I represent is concerned, is the coal industry, and we leam that it is an industry of considerable proportions in Canada. I find that in the year 1927 there was a production of some 17,400.000 tons odd of coal in Canada, being one-tenth of the production of the world that year. Canada too, we are told.

The Budget-Mr. McKenzie

has the second largest coal resources of any country in the world. The constituency I have the honour to represent has a considerable coal mining area, and for the information of the house I wish to make a statement in connection with that industry.
I am sure that the people engaged in that industry will be very thankful indeed that the Minister of Finance at this time has made a reduction in the tariff in this regard. The coal producing area in the districts of Estevan and Bienfait, in the constituency of Assiniboia, which I represent in this house, has recently arrived at a long sought goal, in the progress of converting their lignite coal, of which there are enormous quantities, into high class fuel by the actual production of briquettes from this soft coal. In this area there is an immense quantity of soft coal, and for a long time the finest scientific minds have been engaged with the problem of marketing this fuel. They have attacked the problem from different angles with a view to utilizing this fuel in the most feasible and profitable manner, and now it is thought that this ambition has been realized through the establishment of a carbonizing plant near the town of Bienfait. In this connection I might say that some years ago a lignite utilization board was formed and after investigation they found that by carbonizing this lignite a coal or charcoal was obtained which briquetted quite readily and without reference to the byproducts, such as oils, coke, and so on. The result of this carbonizing process was to turn two tons of inferior fuel into one ton of briquettes, which had approximately the same value as anthracite coal and about the same heating value in the furnace as two tons of the lignite coal from which it was made. At present this process is being carried on at the rate of about one hundred tons of briquettes per day, with the possibility of this output being increased to two hundred tons when the plant is fully in operation.
For the information of the house I might say that some ten or eleven years ago the federal government, in conjunction with the governments of Manitoba and Saskatchewan, spent approximately $1,000,000 in the erection of a plant near Bienfait for the purpose of converting this coal into briquettes. The plant was intended to have a capacity of
30,000	tons of briquettes per year, but this venture was not a success because of the unsuitability of some machinery which had been installed. The venture was temporarily abandoned and the plant closed for four or five years. During this period the government of Saskatchewan, after the federal gov-[Mr. McKenzie.?
ernment and the government of Manitoba withdrew from any further connection with the enterprise, became trustees of the property, and in 1927 they announced that they had been successful in interesting certain people in reestablishing the plant. Through their efforts British capital was forthcoming for this purpose and in the spring of 1928 the reconstruction of the plant was commenced. There was an understanding between the government of Saskatchewan and the interests concerned with the reestablishment of the plant that when $600,000 had been expended in remodeling the plant it would be turned over to this company for a nominal fee. The plant was rebuilt during the summer of 1928 and up-to-date machinery installed at a cost of $600,000. This included a Lurgi carbonizing machine the only machine of its kind in Canada. Then the plant was turned over to the company by the government and since then the work of briquetting this soft coal has been going on at the rate of about one hundred tons per day. In addition, in order to encourage the industry and to further the investment of British capital, the government guaranteed to find a market for the output of the plant for one year. This coal will be burned in the public buildings of Saskatchewan for one year at least, or until the plant is properly established.
I may say that this coal is very soft and is readily affected when exposed to the air. This makes the available market very limited, because it cannot stand to be shipped over long distances, and it was for this primary reason that the briquetting process was first introduced by the governments concerned. People who reside in that part of the country look upon this as the nucleus of a great industry which no doubt will be established in that part of the country; very ambitious plans are being outlined and British capital is said to be ready to finance much greater expansion in this field. In that connection I would say that with cheap fuel available in such large quantities; with the possibilities of utilizing the by-products from the carbonizing of this coal, together with the advantages of power and light at a resonable rate, we believe this field well worth investigation by people looking for locations for industries.
On motion of Mr. Brady the debate was adjourned.
On motion of Mr. Robb the house adjourned at 10.52 pm.

Private Members' Days
Friday, March 15, 1929