1930-05-08

[Stage Direction]
On the orders of the day:
Hon. J. C. ELLIOTT (Minister of Public Works):: Mr. Speaker, I desire in answer to
the question asked by the hon. member for Vancouver Centre (Mr. Stevens) of my colleague the Minister of Marine and Fisheries (Mr. Cardin) yesterday, to say that no plans have been prepared by the government with regard to the dam, locks or causeway about which he was inquiring. Plans were prepared and submitted to the government by the Burrard Inlet Causeway Company Limited, in which they proposed to make a structure which would answer the requirements of the case at that particular point, and for which they asked a subsidy of $125,000 a year by way of assistance. That request has not been granted.



RADIO BROADCASTING


[Stage Direction]
On the orders of the day:
Mr. E. J. GARLAND (Bow River):: Mr. Speaker, I trust the government will be able to give the house an assurance that the radio situation will not be further embarrassed by granting to the Canadian Pacific Railway Company a licence for radio broadcasting stations. May we have a statement?
Hon. PIERRE J. A. CARDIN (Minister of Marine and Fisheries): I have just taken my seat. I will read the question in Hansard and answsr it to-morrow.



RUSSIAN ANTHRACITE COAL

Hon. R. B. BENNETT (Leader of the Opposition):: Mr. Speaker, in view of the
question asked the day before yesterday by the hon. member for North Perth (Mr. Hay) of the hon Minister of National Revenue (Mr. Euler), I am sure it will not be regarded as anything other than proper that I should direct the minister's attention to this morning's despatch in the local papers as to the importation of Russian coal. It is as follows:
Russian coal will penetrate farther into the Canadian market than heretofore with the transhipment from the Voluntas, first vessel of this season with this product, of a part of its cargo of Russian fuel to Fort William. The Voluntas arrived to-day from Mariupol. The steamer Belvoir will take 2,500 tons to Fort William and the steamer Londonderry will take 1.800 tons of the same cargo to Brock-ville, Ont.
In view of the telegrams I have received indicating an unparallelled situation in Fernie in connection with unemployment in the collieries, I would ask whether or not steps will be taken to ensure, so far as may be reasonably possible, the prevention of Russian coal supplanting the Canadian product in western Canada and other parts of the Dominion during the coming season. It may be unfair to ask the minister to answer the question at the moment, and I regret that I did not have this matter before me in sufficient time to advise him in advance, but I should like to have a statement if possible.


Hon. W. D. EULER (Minister of National Revenue):: In reply to my hon. friend, I may say that some weeks ago, following complaints with regard to the importation of Russian coal, investigations were ordered to be made in Russia as to the prices at which the coal was being sold there and other matters surrounding its production. No report has yet been received.



IMPORTATION OF LUMBER

[Stage Direction]
On the orders of the day:
Mr. PETER McGIBBON (Muskoka-Ontario):: Will the Minister of National
Revenue be good enough to give me an answer to the question I asked yesterday?


William Daum Euler: According to my recollection the
question was as to whether the department had knowledge of the dumping into Canada of maple flooring from the United States?
The Budget-Mr. Stevens


Peter McGibbon: Yes.


William Daum Euler: I would say to my hon. friend that investigation is being made, and if the facts are as reported, certainly the dumping clause will be applied in the usual way.


Peter McGibbon: Might I ask the Minister if his department was not made aware of this some weeks ago? It is the second or third time that I have referred to it in the house.


William Daum Euler: I made inquiries after I
spoke to my hon. friend a few minutes ago before the opening of the house. I had no knowledge of it myself, but a letter of protest did come into the department. The investigation then ordered has not yet been completed, but action will follow along the lines I have stated, if such action is justified.



THE BUDGET


[Stage Direction]
The house resumed from Wednesday, May 7, consideration of the motion of Hon. Charles A. Dunning that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Bennett.
Hon. H. H. STEVENS (Vancouver Centre):: Mr. Speaker, the motion before the house is the annual and historic motion that the house do now go into committee of ways and means to consider provisions as to the ways and means for the forthcoming year. On this particular occasion the Minister of Finance (Mr. Dunning) is asking the house to supply over $400,000,000 for expenditure during the coming year. Throughout the whole of his statement he failed to give one syllable or a single intimation of how he proposes to raise this vast sum of money. True, in a general way we know the sources from which it will come, but it has been customary, and indeed the main theme of a budget is to indicate to the house precisely how the government expects to raise the money for which they ask. This particular feature the minister has wholly ignored. There is however before parliament a demand for $400,000,000, and he gives to the house what purports to be a budget speech in which he indicates very extensive changes in the tariff, but he does not indicate whether there will be an increase or a lowering of revenue, or what effect these changes will have upon the taxation and revenue of the country. He simply says to this house and to the country, Figure it out for yourselves. We 
have a right to ask, and we purpose asking the minister, to indicate to the house in a very full and detailed manner the effect of these changes.
Apart from this major oversight on the part of the minister there are three main features to the budget speech-imperial preference, countervailing duties and the growth of foreign trade. I think these may be claimed to be the chief points of the budget speech and I intend briefly to examine them. I shall deal first with imperial preference.
I am sorry that neither the Prime Minister (Mr. Mackenzie King) nor the Minister of Finance is in his seat. In years gone by I think it has been the custom for the Minister of Finance to remain in his seat-


Some hon. MEMBERS:: Hear, hear.


Henry Herbert Stevens: -and listen to any criticism which may be offered so that he may give the proper consideration to such criticism. I can remember one occasion in the year 1922 when the late Mr. Fielding, who sat throughout the budget debate, changed his budget and brought in a second one as a result of the debate and suggestions from this side of the house. The present Minister of Finance however not only utterly fails to give to the house any suggestion as to how he purposes to raise the $400,000,000 but he will not even sit in the house and listen to the discussion of the meagre budget for which he is responsible. I might 'point out further that he was not in his place yesterday; in fact there were only one or two ministers in their seats yesterday.


An hon. MEMBER:: Pretty cheap.


Henry Herbert Stevens: My hon. friend says,
"pretty cheap"; I think it is pretty cheap, and it is a practice unprecedented in the history of this parliament.


An hon. MEMBER:: There might be a reason.


Henry Herbert Stevens: country to grant to the overseas dominions some preferences in those markets. The time has come when we should make it perfectly clear to the mother country that if this imperial preference is to continue it must be a two-way preference.
Now I will briefly run over what the various dominions already have done, and I am going to give only the rough percentages because to go into detail would be wearisome. These are the rough percentages of what the overseas dominions have accorded to the mother country in the way of preferences: Australia, 10 per cent and in some cases as high as 20 per cent; New Zealand, 10 per cent to 20 per cent; Irish Free State, one third of the duty on motor cars, 30 per cent to 50 per cent on imported wines and a reduction of one sixth of the general tariff; Rhodesia, 10 per cent to 12 per cent; Union of South Africa, generally speaking about 5 per cent; on motor cycles and electrical appliances, 15 per cent; India allows a preference of 17 per cent on iron and steel goods. Then there is a long list of small dependencies and colonies where the preference runs from 5 per cent to 20 per cent. In Canada the general advantage to Great Britain, as compared with the general tariff, is 10 per cent to 12 per cent, without taking into account the changes of to-day.
There are other features in connection with the imperial preference which might well be studied by parliament and by the government. These are privileges which have been extended to us by the mother country, and we might very well consider if there are any such privileges which we could extend to them. The Trustee Securities Act of 1893 provided that securities for trust funds, including stocks of empire concerns, would be included in the classes of trustees' securities, in this way facilitating the borrowing of money in the old country. Then there is the Empire Marketing Board, to which the British government grants $5,000,000 a year. This is an excellent gesture and serves a very good purpose. There is the Merchandise Marks Act of 1926, which calls for the marking of goods with the place of origin. There is also the Films Act of 1927, calling for an increase in the proportion of films made by British companies or by companies within the British Empire, and we must remember also that government purchases are restricted to United Kingdom and empire goods. At the recent Imperial conference the McKenna duties of 1915 on motor cars, musical instruments, gloves, watches, films, cocoa, coffee, dried and preserved fruits, sugar, tobacco and so on were revived, and in

1925 Mr. Churchill also gave certain other preferences on sparkling and ordinary wines and other articles. I will not go into full details.


Mr. ADSHEAD:: Does my hon. friend
expect that the mother country will give a preference to Canadian agricultural products such as wheat and so on against the Argentine?


Henry Herbert Stevens: I will answer that question in a moment; I am coming to that very point now. Now I want briefly to run over a few items in which Canada is very much interested and with regard to which I think we have reason to ask for some preferential treatment in the British market. I want to make it clearly understood that I am not suggesting for one moment that the list which I shall give is comprehensive at all.
Let us consider minerals, for instance; take copper first. Great Britain imports about
160,000	tons of pure, refined copper per year; she is one of the largest importers of copper in the world. Of that amount only 14,000 tons comes from within the empire; the balance comes from the United States, Spain and other places. I think we have a perfect right and I believe it would be a sound principle to say to the mother country, " Here, we are a big producer of copper; we desire to supply some of your requirements." Most of our copper for the past thirty years has gone to the United States; 82 per cent of our production goes to that country in the form of ores or in concentrates, not even smelted, and in addition a large quantity is in blister copper which goes to that country for refin-The city of Tacoma on the Pacific coast, in the state of Washington, has virtually as its chief industry a big smelter which depends entirely on the ores from Howe Sound, just north of Vancouver. Daily thousands of tons of concentrates go past our doors at Vancouver to maintain this huge industry in the city of Tacoma. I have not the figures for the last year or two, but some time ago I went into this question with great care and found that 82 per cent of the copper produced in Canada went to the United States in the form of ores or concentrates. They smelted, refined and merchandised those ores, and where did they sell them? Of the purchases made by Great Britain, 64 per cent came from the United States, consisting largely or in part at least of the copper which we produced, and from which we only got the cost of digging it out of the ground. In that respect I say we have a right to tell the mother country, " Here is an article upon which we can come to some understanding," and I

The Budget-Mr. Stevens
believe the result would be that the Britisher could get his copper cheaper and we could get more for it, because in the merchandising of copper or any other article, that is in the trading between merchants, there is a profit as well as in the smelting and refining.
Then let us consider lead, of which 40 per cent of Great Britain's requirements come from other than the empire. Great Britain is a big importer of lead. Consider the question of silver, and just here let me say a word or two about silver. I could take an hour to discuss this question but I am just going to say this: I believe at the. next Imperial conference Canada particularly- because we are vitally interested-ought to bring to the attention of the empire the great question of silver, silver coinage and the remonetizing of silver. I am not going into the intricate and complex question of the remonetizing of silver, but its history is a tragedy. There is no doubt of this in my mind. In 1873 one billion people in the orient, in China, in India, in the Malay states and in Mexico, were deprived of two-thirds of their purchasing power by the action of the nations of that day. That is one reason for the agricultural and commercial depression which exists to-day all over the world. One half of the human race is living below the margin of decent living. In fact, millions upon millions in China, during this present year, have died largely because of the inadequacy of their purchasing power. To my mind, Mr. Speaker, this matter of silver is the biggest subject before the people of the world today. I call attention to it merely because we are a big producer of silver. Great Britain is a large importer, having imported during 1927 55,000,000 ounces of silver. During the same period, India imported 116,000,000 ounces, and nothing would help Canada, Mexico and the United States so much as the solution of this complex silver problem.
Great Britain in 1927, imported 150,000 tons of zinc, principally from Belgium, Germany and the United States. To-day our zinc is selling, I think, for 3 cents a pound.
A moment ago I pointed out that in 1819 Great Britain gave this country a preference in the British market for timber, and that was the basis of the great timber business carried on in Ontario and Quebec. I can recall from my earliest days in Canada-there are others who can go back much farther-seeing rafts of timber going down the St. Lawrence river to the historic city of Quebec, which was at that time the centre of the timber trade of Upper and Lower Canada. What are the facts to-day? Great Britain imports 550,000,000
cubic feet of lumber-I am not giving the board measure, but it can be obtained by multiplying by 12-of which 521,000,000 cubic feet, or 94 per cent, comes from sources other than the British Empire. Canada should be able to secure a larger share of this market. We were told by the British economic commission which sat a year or two ago, presided over, I believe, by Lord Lovat, that at the present rate of consumption the soft woods of the world would be exhausted within 30 years. I cannot say whether or not that estimate is correct, but that statement is contained in the official report. We all know that our great forests are being denuded at an alarming rate. Canada has great forests, and there should be a reasonable conservation of these great resources, but we are entitled to a greater share of the British market. During the past two or three years the exporting of lumber from Canada has been an unprofitable business because it has been necessary to carry it on as close to the margin of profit as is possible. I was told by one of the largest exporters in Canada that although to-day he is exporting three times the amount of lumber that he did some two or three years ago, he has made a smaller profit. This small margin of profit is caused by competition from Russia, Finland, the Baltic states, and so forth.
I now take up the question asked a moment ago by my hon. friend-that of wheat. Slightly more than one-half of the wheat products imported into the United Kingdom during 1927, were imported from foreign sources. I will repeat in part what I said before the right hon. the Prime Minister (Mr. Mackenzie King) took his seat, that I have no hesitancy in saying to the mother country that if this great doctrine of imperial preference and interimperial trade is to prevail, if it is to mean anything, it must be reciprocal. There must be two parties to the bargain. That is one of the things which must be asked of the mother country, not with the idea of taxing food but rather of a preference to be granted on Canadian wheat. The question may be asked: how are we going to do that except by taxing food? I will grant that, but it also involves a complete change in the fiscal policy of the mother country. It is not our business to tell the mother country what her fiscal policy should be, but it is our business to tell her that if this empire is to be sustained, econonimic laws, as well as sentiment, must apply. They will have to sit around the table with us and determine what preference we are going to have in their markets. The mother
The Budget-Mr. Stevens

country has been purchasing the subsidized wheat of Germany, and the overplus of France; she has been combing the world for wheat.
I am not here to apologize for or defend the Canadian pool, because I know very little about its internal workings. There is a very acute problem facing Canada in so far as the marketing of her wheat is concerned. Responsibility rests upon the shoulders of the government to face a national problem of this kind. I will tell the Prime Minister that it will not do to say that that is the business of the cooperative societies handling these things. There comes a time when private enterprise cannot function in the face of great national difficulties, and that time has arrived in connection with wheat. One of the solutions for this problem is the securing of a permanent and larger share of the British market.
I do not propose to go any farther into this imperial preference except to say that the extension of this preference should be mutual and should be based upon an intelligent appreciation of the internal interests of both parties; otherwise it can be only mischievous.


Herbert Bealey Adshead: How can we obtain that English market for our wheat?


Henry Herbert Stevens: I have no desire to repeat myself, but I told my hon. friend a moment ago that it is not our business to dictate to the British authorities what they shall do. Surely two intelligent groups could sit down together and decide these things. One advantage which they want is access to our markets; this government is pretending to give them that access. In turn for that, we have the right to say: Give us a preferential access to your market for some of our vital products.
V hen the hon. leader of the opposition (Mr. Bennett) was emphasizing the other day the need of looking after Canadian interests, the Prime Minister interjected the remark: What of the empire? I ask the Prime Minister:	What of the empire for the last five
years? The figures which I will now give show that this condition has been chronic for the last thirty years, and has been accelerating during the last six or eight years. The average figures for the last five years show that we imported $746,000,000 worth of goods from the United States and exported $482,000,000. During the year 1930 the imports amounted to $847,000,000 and the exports $514,000,000. The average figures for five years for the United Kingdom show imports of only $180,000,000 and exports of $411,000,000. Let us look these figures squarely in the face. This thing has been going on for some thirty years. Why
FMr. Stevens.]
the anxiety just now? Is it simply because there is surcharging the atmosphere the suggestion of interimperial trade? Why is it that the Prime Minister has not in any one of the seven years since 1923 when he was a party to passing that resolution at the Imperial conference, acted, although he said at the time that the matter was urgent. Why is it that in the year 1930, just before an election, it now becomes important? Why is it he says t.o my honoured leader: What about the empire to-day? What about the empire last year, or the year before, or the year before that?
Let us examine further this imperial policy and budget. In nearly 50 per cent of the items I find there has not been any change whatever. Why, the Minister of Finance stood in his place the other day and assumed an air of tragic importance when he said: This involves changing some 500 items in the tariff. He endeavoured to impress upon us the magnitude of the change and that was headlined throughout the country. This was to be a great general revision of the tariff. I counted the items and I think there are 420 instead of 500, but of those there are at least 178 in regard to which there is not an atom of change in duty, the only change being that they are arranged in a different order. In eighty-five others affecting the British preference the change is so slight that it will never be noticed. Let me give one instance:
Malt flour containing less than 50 per centum in weight of malt.
And so forth. This is to be a great concession to the British producer of malt, but the change is one-tenth of one per cent down. In other words, if you paid $10 in duty before the budget was passed, you would pay $9.90 after it was passed, and there are eighty-five articles very little better than that, so that we whittle the matter down to a pretty narrow compass. That is not all. There are other changes which are merely annoying without being of any advantage to the mother country. Let me give an illustration. We have built up in Canada a very fine electrical appliance manufacturing business to manufacture electric lights, switches, wiring and so forth. In Ontario, for instance, there are several large industries built up on that basis. There has been a reduction in the duty on the items: Electric light fixtures and appliances.
Electric head, side and tail light; electric torches or flashlights.
Electric arc lamps and incandescent electric lamps.
And so forth. I cite these merely as an illustration. The change is from 20 to 15 per

The Budget-Mr. Stevens
cent and it is simply a trifling, annoying change. It is a question whether anybody will derive any advantage except that it may open the market a little so as to lessen the purchases from Canadian firms and, I venture to say, without changing one iota the price to the consumer. If the government were going to put these things on the free list; if they were going to transfer the business to Great Britain as, under their scheme of inter-imperial trade, they pretend they are going to do, why did they not put them on the free list and put these firms out of their misery? On the other hand, if they have some consideration for Canadian industry, why do they not allow a reasonable, protective tariff to remain on an industry that has been up over a period of thirty-five years? I remember well thirty-five or thirty-six years ago when the first sod was turned in the city of Peterborough for the Canadian General Electric, that huge firm which has gradually grown up and established one of the greatest industries of the country. It is concerns like this that are giving our people a livelihood, an opportunity to make their way in Canada. Why jeopardize them? Why annoy them? If the government are going to have a policy which will put industry out of business, let them say so. If, on the other hand, we are going to have a policy that will give Canadian manufacturers a chance at the Canadian market, then let us retain the duties as they are.


Mr. EVANS:: Is that an infant industry?


Henry Herbert Stevens: I never said it was. Let me tell my hon. free trade friend, this Ishmael-ite on free trade, that he has never heard me discuss protection on a basis of infant industries.


John Evans: If it has been well established, why does it need protection?


Henry Herbert Stevens: I have not time at present to discuss that, but some day I will take an hour off and enlighten my hon. friend. Let me refer now to washing machines. Just why were they put on the free list? Was any consideration given to the question? There is one industry that I know of with a production of more than 86,000,000 per annum, with 650 employees in a comparatively speaking, small Ontario town, one of those happy communities which, if you like, are models for the world.


Mr. HOCKEN:: Like Kitchener.


Henry Herbert Stevens: Yes; one of those splendid little Ontario towns and one of those industries that are the backbone of eastern Canada. Why should we jeopardize the life of that industry? What is this going to amount to in the great problem of inter-imperial trade?


Mr. CHAPLIN:: Let us have the minister treat it as furniture.


Henry Herbert Stevens: It might be so treated.


Mr. SANDERSON:: As regards the washing machine industry I have in my room a letter from one of the largest manufacturers in the Dominion and he is well pleased with the change in the tariff.


Henry Herbert Stevens: I am glad to hear that. I have my own views on these matters and I am presenting them. If my hon. friend knows of any manufacturers who are pleased with the changes, let him bring them along; the government will be glad to receive them.
Let me say a word or two in regard to countervailing duties. This is a feeble response to a nation-wide wave of indignation against this United States economic penetration. Will the Prime Minister do me the honour of recalling an occasion just about five years ago when we were concluding the budget debate of that session, when I said to him words to this effect, that if his policies were persisted in, the inevitable result would be the economic absorption of Canada by the United States? I think I was laughed at on that occasion, but yesterday we had it from the lips of one of his bright young followers that the reason for what we have before us now is that the United States has, during recent years, so penetrated Canada in an unfair competition that the government has at last been driven to take this action. The Prime Minister and his government come before parliament and in effect say this: We are conscious that throughout Canada there is a wave of indignation against the economic penetration of Canada by the United States under most unfair conditions. So they say: We have imposed countervailing duties. That is the government's answer. Let us examine these countervailing duties. They cover some eighteen items out of some twelve or fifteen hundred in the tariff. That is no answer. It will answer only if it is not discussed, only if the Prime Minister can get over to the public the idea of a countervailing duty against the United States without going into the details and an exposition of just what the application is. It is no answer at all; it is simply the answer of a small boy looking around the corner at the town bully and sticking his tongue out at him. If this thing is serious, if these countervailing duties are to become
The Budget-Mr. Stevens

the doctrine and policy of Canada, apply them to the tariff as a whole. Apply them on a broad basis.
Let us look at some of these eighteen articles to which the countervailing duties are to be applied. First, animals. I suppose that these duties will apply to goats, sheep, baby chicks and a few things like that. They also apply to live hogs, canned meats and other meats, tallow, beeswax, eggs. I will admit this, that with respect to eggs, so long as the United States duty is eight cents a dozen, a countervailing duty will be partly effective, but should Uncle Sam just in a playful mood decide to lower his duty to four cents, the protection would be gone overnight.
Take fruit and vegetables. On fruit and vegetables the countervailing duties will apply during the winter months when they are not very much required, but when the period of glut comes when the orchards of Wenatchee are able to unload their surplus fruit on a salvage basis, or when there is a glut of vegetables coming in from the southern states at the time when our own fresh vegetables are coming on the market, at that time your countervailing duties will not be worth a snap of your finger. The government repealed the only protection we had against that sort of thing, namely, the dumping clause, and they have refused to listen to the appeals for a seasonal tariff. This answer of the government, Mr. Speaker, is not an answer. These countervailing duties will not do the job. Furthermore, limited as they are to eighteen articles, it is the mere gesture of a schoolboy as compared with what it should be, and that is a frank notice to the United States that we are not going to tolerate longer the condition that exists in this regard.
I must hasten on. I wish to refer briefly to foreign trade. This has been heralded by hon. gentlemen opposite, and particularly by my hon. friend from Winnipeg South Centre (Mr. Thorson), who said yesterday:
Canada has made greater progress in foreign trade than any other country in the world.
He also declared in the same speech that he wanted British export trade to prosper. That is all right. I want British export trade to prosper in the interests of Britain. But I want Canadian trade also to prosper. I want my hon. friend, who is a student and intelligent, to follow me in a very brief argument if I can get time to put it across to him.
He will admit this, that the United Kingdom has an excess of imports and is a loaning country. I do not think those two facts will be disputed. Her imports are paid for in three ways:	(1) By exports; (2) by services,
such as shipping and so forth; and (3) by 
interest on investments. Canada, on the other hand, is a borrowing country, having borrowed six billions of dollars or more upon which she must pay interest abroad every year, which at five per cent amounts to $300,000,000 annually. So Canada is under the necessity of exporting $300,000,000 worth of goods to pay for that item alone. Canada imported last year $1,265,000,000, and she has to pay for that with exports, adopting the free trade doctrine that exports pay for imports. In addition, Canada has little carrying business of her own; she pays British and foreign shipping for her carrying. She will pay out annually about $150,000,000 in carrying charges, and she must pay for that with exports. So you have the sum of $1,715,000,000 that she must pay for with exports, and her exports amount to $1,388,000,000, leaving a deficit of $327,000,000. How do we cover that deficit? By borrowing abroad and gradually mortgaging the Dominion more and more year by year.


Mr. M. F. HEPBURN (West Elgin):: Mr. Speaker, it is always pleasant to listen to a speech such as was delivered by the hon. gentleman who has just taken his seat (Mr. Stevens). One cannot but admire his fine flow of language, and to some extent one can almost follow his logic. It seems regrettable that one of the ablest debaters on the opposition side should have announced his retirement from public life, but even yqt let us hope that the report of his retirement, like the report of Mark Twain's death, is greatly exaggerated. I shall not attempt to follow his argument in detail. Rather I shall direct myself to the general policy of criticism that was enunciated the other day by the hon. leader of the opposition (Mr. Bennett) himself.
The leader of the opposition was somewhat at sea with regard to a definition of the budget. As we all know, each year the government meets and listens to the representations made by the various members representing the constituencies throughout Canada. We all know how diversified the interests of our country are, and after listening to all these representations the government brings down a policy which sums up and crystallizes into legislation the general needs of the people of Canada as a whole. I think in this respect the government has done exceptionally well in the budget. In fact, I do not think ever before has any budget met with such general unanimity of endorsement as the budget that has just been presented by the Minister of Finance (Mr. Dunning). It would be foolish to say that all members on this side of the house agree with the budget in every detail.

The Budget-Mr. Hepburn
One could not expect that. One could not expect the leader of the opposition to bring down a budget which would meet in detail with the approval of every member of his party. I would like to ask, for instance, how he would reconcile the conflicting interests of his friends from the maritimes, who are seeking a higher rate of duty on coal, with the interests of the Conservatives from British Columbia who would be very glad to see a reduction in the duty on coal. So we have to look at the matter in its broad aspects.
I think that this budget has so confused the leader of the opposition that after his three hour speech on Tuesday he had demonstrated only two things-one that he was completely in the woods and had not yet seen his way out, and the other that it had apparently developed in him a sort of vindictive spirit which probably prompted him to introduce his motion of want of confidence in the words he used, charging the government with insincerity and with having lost the confidence of the country.
I do not know any member who should hesitate more to charge the government with insincerity than the hon. leader of the opposition himself. What was his stand on the liquor export bill? He said that during the session of 1926, when the Conservatives were in power, or thought that they were in power, they adopted a motion to the effect that liquor clearances should be stopped, and so he says, " I am the father of this political child." Then he went on and dramatically rose to great heights, waggling his finger across the floor at the Liberals and censuring them for not having brought down the legislation before, and he said that it was because Liberals were participating in what he called a "rat fund." The hon. member for Lisgar (Mr. Brown) pointed out that in the report of that same commission, a gentleman from Vancouver-I shall call him a gentleman- admitted that he was the financial agent for the Conservative party, and that he had accepted funds for that party from that source. That took the wind completely out of the sails of the hon. leader of the opposition. His speech on that occasion only went to show that he could use a great volume of words, use a machine gun to slay a mosquito and could make a mountain out of a mole hill. He stated in reply that he had not read the whole report of the commission which he tried to use for the purpose of criticising the Liberal party. Now, as parliamentarians, we must accept the word of the hon. gentleman, but I venture to say that when he came to the
part which told of his party participating in the campaign funds from the liquor interests he must have stuck his tongue in his cheek and closed one eye. Not only has he claimed parentage to the liquor clearance bill, but he also states that all the good children in the budget belong to him, and all the bad ones to the Liberal party. Further, he claimed paternity of the proposed imperial conference. I think the hon. gentleman is so politically prolific that instead of being known as the leader of the Conservative party he might well be called George Washington, the father of all good ideas in our country.
He assailed some hon. gentlemen on the front benches of the Liberal party rather vigorously, particularly the Minister of Finance and the Minister of Railways and Canals (Mr. Crerar). Well, I do not think he detracted very much from the high esteem in which those gentlemen are held by the people of Canada. He went further, he also attacked the present chairman of the tariff board, Mr. Moore. He attacked him because of the fact that Mr. Moore was at one time connected with the Mackenzie and Mann interests. Evidently attacking men formerly with these people is an obsession on the part of the hon. gentleman; for I remember that at one time he attacked even Mr. Meighen and dubbed him the megaphone of the Mackenzie and Mann interests, although afterwards he was content to be a loyal follower of Mr. Meighen. While he was bringing under his condemnation former associates of the Mackenzie and Mann interests, I thought he might very well have gone down the front ranks of his own party. Had he done so he would have found that the hon. member for North Vancouver (Mr. McRae) was-so I am informed-a leading agent for the same interests, a gentleman who now guards the war chest of the Conservative party. If he did not profit by his connection with the Mackenzie and Mann interests, I think it was only his own fault. He surely missed an opportunity.
The hon. gentleman seems to think that disintegration is taking place on the government side. He might have applied to himself Burns' couplet:
O wad some power the giftie gie us,
To see oursels as others see us!
I cast my eye across the floor and observe the hon. member for Vancouver Burrard (Mr. Clark), one of the senior members of the Conservative party, who has announced his retirement from the party; as has also the hon. member for North Simcoe (Mr. Boys), one of the ablest debaters on the opposition benches; there is also the hon. gentleman who



The Budget-Mr. Hepburn
has just taken his seat (Mr. Stevens), a former Minister of Customs in a Conservative administration. Glancing down the front opposition bench, I see missing the genial member from British Columbia, Doctor Tolmie, who even after he left the house had a disagreement with the leader of the Conservative party. Another hon. gentleman missing from the front benches opposite is Sir Henry Drayton, who is now gracing the liquor control board of Ontario as its chairman. There may be some extenuating circumstances in that respect, because anyone found drunk in Ontario might claim a certain degree of respectability from the fact of having purchased his liquor from an organization headed by a belted knight drawing a salary of $25,000 a year. Further down the front benches opposite we have two former Laurier Liberals, who certainly when they speak of the insincerity and deception of the Liberal party should be able to express themselves very feelingly on the subject. I am wondering what attitude my hon. friend the genial doctor from Fort William (Mr. Manion) will take following the introduction of this budget. Will he get up as he did last year, and dramatically with blood in his eye, talk about red-blooded Cana-dianism and be ready to stay here all summer hoping to take the Yankees out into the front yard and spank them?


Mr. BELL (St. Antoine):: May I ask the hon. member a question?


Mitchell Frederick Hepburn: Certainly.


Leslie Gordon Bell: Are you discussing the washing machine item on the budget?


Mitchell Frederick Hepburn: I think I am washing you fellows pretty well, and I don't need any washing machine to do it.


Mr. DUFF:: You need a wringing machine.


Mitchell Frederick Hepburn: 

The Budget-Mr. Hepburn
Hon. gentlemen across the way say that there is nothing in the British preference; that it means nothing; that this new avenue of trade we are trying to open up is not capable of development. We know differently. I am not going to take. the time to read any of the comments of the British press, but I may [DOT]summarize by saying that the British press recognizes that this is not only a gesture of good will but a method by which the British industrialists can open up new avenues of trade for their produce and marketable goods and can in turn take care of the ever-increasing food production in Canada. We heard a great laugh from our Conservative friends when mention was made of placing fruits and vegetables upon the free list under the British preference. The laugh was on the other side of their faces however when the Minister of Finance announced that trade arrangements with the West Indies would permit the importation of a great quantity of fruits and vegetables. I listened intently and with great respect to the remarks of the leader of the opposition when he attempted to minimize the importance of our present trade arrangement with the West Indies. In this connection I wish to place on Hansard a statement issued by Mr. M. J. Hunter, president of the Toronto Fruit Protective Association:
When domestic fruits and vegetables are out of season it will tend to increase business with the West Indies. Until last year the Indies have not kept pace with the times in the marketing of fruit. They shipped it in containers such as their ancestors used seventy-five or one hundred years ago. Often the growers brought it down to the wharfs three or four days before the date of sailing. Then it was loaded on ships which had no refrigerator systems. They knew nothing about packing lettuce in ice, for example, as the California growers do. All the new Canadian National steamships have refrigerating systems to carry fruit, and representatives of the West Indian growers spent last year in Canada studying marketing methods and requirements.
He said iu conclusion:
At the same time any increase in the amount of fruit and vegetables brought in from the West Indies will not be a detriment to Canadian producers since they will only come in during the season when Canadian-grown fresh fruits are off the market.
On top of that we have a statement which appeared in The Ottawa Citizen a short time ago to the effect that a boatload of vegetables had arrived at the port of Montreal from Bermuda. It was announced that the whole cargo was sold out and many Ottawa merchants went to Montreal for the purpose of inspecting it. That would seem to be an indication as to the possibility of developing trade with the West Indies with respect to fruit and

vegetables. The fortunate part of it is that these fruits and vegetables can be imported from the West Indies during the season when Canadian-grown produce is off the market, and in return we can sell many of our marketable products to them. My hon. friend the leader of the opposition made some statement in regard to economics. His remarks may have been prompted by political motives, but I wish to say that I am always interested in getting the opinions of the leading economists. I have in my hand the opinion of two outstanding economists, one a Britisher and the other a Canadian. I shall refer first to the statement of Sir Benjamin Morgan, who was for ten years chairman of the British Empire producers, organization and is now vice-chairman of the Empire Economic Union:
These proposals will stimulate as nothing else could the desire throughout Britain to reciprocate by increased purchases of Canadian goods and will help to crystallize a policy that will make for the consolidation of the empire into one economic unit.
He goes on to state:
It is a great example to the empire and if we could embody the Canadian proposals in a commercial agreement with the mother country together with maximum reciprocities on the part of Great Britain, we should stabilize for a number of years the outlook for industries in both countries. Voluntary preferences in the past have suffered from being subject to revision or alteration in each succeeding budget, and the time has come when it would be to the advantage of the empire countries to replace voluntary preferences by a negotiated reciprocal commercial agreement. I hope this may be crystallized at the forthcoming imperial economic conference.
When an economist such as the one I have just quoted holds an opinion diametrically opposed to the opinion of the leader of the opposition, I am very much inclined to take the views of the economist, who points out that Canadians will find an increased market for their produce and at the same time the Canadian farmer will be guaranteed against the increased cost of production by this new trade which will develop with the British Empire.
I have before me the statement of another economist, Professor K. W. Taylor, the authority on public finance with the economics department of McMaster university. He is reported as having said among other things, the following:
Overseas trade has been built up by the government by the extension of the work of the Department of Trade and Commerce with the establishment of Canadian trade commissioners in foreign countries. The development of export trade must be done by the individual business man. All the banks and the government can do

The Budget-Mr. Hepburn
is to point the way. The reduction of tariffs to Great Britain will certainly build our overseas trade.
I was very glad to see that Mr. Dunning deprecated the tariff wars. The past 100 years has proved the futility of tariff wars.
In regard to British preference I wish to point out that while under our revised schedule some may say this is a high tariff budget, I would say on the contrary that it is very well balanced. If hon. members would study the schedule they would find that the rates have been greatly changed. In the general tariff 54 items have been increased and 46 have been decreased. Under the intermediate tariff 35 items have been increased and 98 have been decreased. Under the British preferential tariff the rate has been increased on 11 items and decreased on 270 items. When the revision is complete the tariff schedule will consist of 1,118 items, and of these 559 will be free under the British preference. I think it is futile and useless for our friends across the floor to argue that these changes will not stimulate trade and are not in keeping with the principle of trade extension advocated by the Liberal party.
I do not know just what is left for my hon. friends across the floor to talk about. It may be that they will bring forward the idea of the unfavourable trade balance, which seems to give them quite a handle as long as they can becloud the real truth of the matter. We must admit that this year we have an unfavourable visible trade balance of about $113,000,000, but we know very well, and any child should know, that if the marketable wheat had been sold out of this country we would have added about $225,000,000 to our sale of goods abroad, or perhaps more, and that shatters their argument with regard to the unfavourable trade balance. In the ordinary business of the year we are still ahead; in that respect I would say we have a favourable trade balance of about $112,000,000, and we have not taken into consideration the invisible trade balance of this country.
Coming as I do from the southern peninsula of Ontario I am in a good position to closely observe the American tourist traffic. It was estimated last year from reliable sources that our United States friends spent about $300,000,000 in this country in that period. Personally I believe that to be a conservative estimate; nevertheless we will accept it. That estimate was made by the president of the Royal Bank of Canada, by the Wall Street Journal and by various motor leagues throughout the country; and all these authorities go on to point out that it is possible for us in Canada to develop this business to a billion dollars annually. If we do that,
to a certain exent it will take away from our exportable surplus and, under the logic advanced by hon. gentlemen opposite, it will be possible further to confuse the people of Canada. However, I do not believe they will be able to confuse the people of southern Ontario, because those people know very well what is going on. In the summer time they see that about every other car on the highway is from the United States, and they realize that at least fifty per cent of the business done by the retail merchants of southern Ontario is carried on with American tourists.
It would be folly for this country to carry into effect the idea enunciated by my hon. friend who preceded me in this debate. He spoke of a general upheaval of the tariff. Supposing we carried out that policy in its entirety and increased the cost of all our goods in Canada. Then we would be in such a position that we could not offer these goods at attractive prices to our American friends. If the American government goes on increasing the tariff of that country, as it proposes to do, thus increasing the cost of all the articles the people of that country must buy, we will be able to offer them an extremely attractive proposition in the way of cheaper goods. I do not doubt that if we maintain this policy which is now before us, within the next five or six years ait least we shall be selling to tourists from the United States fully a billion dollars' worth of goods in our own country.
Then there is one other question, that of unemployment, to which my hon. friend the leader of the opposition made some reference. Well, the explanation of unemployment is very simple. We are living in a new era, an age of mechanization both of the farms and of the industries of Canada, and we realize that situation, which is very obvious to us when we see the displacemenlt of labour by machinery. As a farmer I see how this works out in carrying on my own business; I can do it with less labour than my grandfather needed. Now we have tractors; we have electrical equipment as well as all the other modern labour-saving devices on the farms, and we must buy and use these devices in order to be on a competitive basis. In the western provinces we have seen the introduction of the combine harvester, and we know the amount of labour being displaced in that way; we know that there may not be any more of the old time harvester excursions to the west. We see that sort of thing all along the line. We see the displacement of labour by machinery in industry as well. I am not going to attempt to place on Hansard any of the official figures in this regard, but
The Budget-Mr. Hepburn


Mr. THORSON:: How about the Progressives asking for protection?


Mr. FANSHER (Last Mountain):: There
were no Progressives from the province of Saskatchewan asking for protection. If the hon. member is implying that any others asked for protection, I cannot contribute to that analogy. You have one interpretation and I have another.
I would like to deal with one phase of the budget which to my mind transcends all others -the British preference. A few days ago there was blazed across Canada in bold headlines the statement that the King government had increased the British preference and that they had gone a long way in making it possible for British Goods to have freer access to Canada. There are very few items in the schedule which can be said to have a freer flow to Canada, because we have a preponder-ence ourselves of most of the items, and in some cases we are even exporting. It seems ridiculous to consider that hay and straw and similar products have been placed on the free list.
Any items mentioned in the present budget are subject to that clause brought down by the late minister, the Hon. Mr. Robb. His words appear on page 543 of Unrevised Hansard of 1928, as follows:
At present Canada requires 25 per cent to be empire labour and materials. It is proposed to double this percentage.
That resolution passed, and the percentage of British Empire labour and material was lifted from 25 per cent to 50 per cent. That
1888	COMMONS
The Budget-Mr. Fansher (Last Mountain)
affected seriously two commodities, the chief one of which was cottons. Each year we import a large amount of cotton textiles from the British Isles, and we have been importing also considerable copper. Those two items were placed beyond the pale of the British preference and were put into the general tariff because of that clause. It is my desire to show how that particular clause has affected the marketing of Canadian wheat products. More than anything else, it has brought about the condition we have now to face.


Mr. McLEAN (Melfort):: Do I understand the hon. gentleman is stating that cottons do not come under the British preference on account of the 50 per cent clause?


William Russell Fansher: If my hon. friend will pay attention to my remarks he will receive his answer.


Malcolm McLean: A plain yes or
no would do it. I understand the hon. member said that, and I would like to know whether or not I am correct in my understanding.


William Russell Fansher: In
answering that question yes or no, it would be like answering the question:	Have you
stopped beating your wife.


Malcolm McLean: That is an old
chestnut.


William Russell Fansher: 
Malcolm McLean: No. I was asking the hon. member if he would say that cotton goods have been or are now being excluded under the 50 per cent British clause- not what a newspaper might say about it before the law went into effect. It is for information that I am asking. I would like to know.


William Russell Fansher: 
Mr. W. S. MURPHY (Lanark):: Mr. Speaker, in rising to take part in the debate on the budget I am willing to admit that I do so with considerable trepidation. The subject is of such vast importance and can be approached from so many angles that one finds it difficult to decide just what questions to discuss.
Having been accustomed in the routine of daily life to devote my attention to the problems of health and disease, to seek the causes and effects of certain conditions that affect the health of my patients, I am forced to pursue a somewhat similar attitude in this debate. To-day I am to deal with a new patient-Canada-and try to ascertain whether or not the body politic is in a really healthy condition. Generally speaking, no one will deny that Canada has been enjoying a great measure of prosperity. The ship of state has been sailing on a kindly sea under very favourable trade winds, but of late certain conditions have arisen which portend a less favourable voyage. There are breakers ahead, and these breakers are to be found in our unfavourable trade balance for the past year, to the extent of some one hundred million dollars, in the general and widespread depression of business throughout the country, in the great amount of unemployment of our labouring classes, and in the slow and progressive atrophy of our basic industry, agriculture.
I have the honour, Mr. Speaker, to represent the good old county of Lanark, a county of vast and fertile acres, a county whose people are descendants of those early Scotch, Irish and English pioneers who inhabited the land

The Budget

Mr. Murphy
when it was a vast forest and hewed out homes for themselves under very trying conditions. This is a county that has endeavoured through years of toil and struggle to establish within its bounds important manufacturing industries, and last but not least a county which has given many of its sons and daughters to work for the general welfare of this great Dominion. I might remind you, sir, that our present capable and esteemed Minister of Agriculture (Mr. Motherwell) is a native son of that county.
At the outset I mentioned that Canada had been enjoying a fair degree of prosperity. I ask in all fairness, can that prosperity be due in any great degree to the policy of the present government? Can they take unto themselves credit for the bounteous crops with which Providence has blessed us? Can they assume the credit for having placed in that great precambrian shield those vast and untold mineral resources that are to-day undergoing such extensive development? Can they regard our great forest wealth as something of their production? And so I might proceed asking questions about the basis of our national wealth, and having done so I am
forced to the conclusion that none of these things can be accredited to any act of this government. Wherein, then, does the function of government apply, so that this great heritage which has been handed down to us may ibe developed for the benefit of us Canadians? In answering this question we must analyse the various policies of the government in so far as they may assist in promoting or retarding the development of our natural resources and our industries. It is my intention to deal first of all with agriculture.
Agriculture has been called our great basic industry. In fact, for a great many years it was the chief source of our national wealth. iHowever, during the past few years, and .especially since the great world war, it has failed to keep pace with the march of our industrial development. Agriculture has apparently reached its peak and at the present .time is on the decline in many of its branches I desire to quote the following figures to show what the real condition of this industry is and has been during the past few years. ,1 have in my hand a tabulation which I shall ask to have placed on Hansard:

Canada's Production, Exportation and Importation of Raw Materials of Farm Origin
Description
Field Crops
Wheat	bush
Oats	 "
Barley	 "
Rye	'. "
Peas	 "
Beans	'.. '	"
Buckwheat	]. "
Corn	 "
Potatoes	 cwt.
Turnips, etc	 "
Hay (including clover and
alfalfa)	 ton
Sugar beets	 "
Apples, green	 brl.
Seeds-
Clover-Alsike	 lb.
"	- Alfalfa	 "
" -Red	 "
Flaxseed	bush.
Tobacco	 lb.
Animal Products
Butter	 lb.
Cheese	
Condensed milk and milk powder	
Beef	
Pork	|
Mutton and lamb	
wool	;;;;
Eggs	 doz.
Produced in Canada
407.136.000
383.416.000 99,987,100 12,178,900
2.635.000 1,159,500 9,882,300
7.813.000
46.937.000
34.235.000
16,119,300
525,000
2,954,370
9.080.000
8.160.000 1,138,500 5,994,700
28,824,000
272,209,287
171,731,631
95,255,252
361,831,070
111,396,786
24,387,083
17,959,896
237,080,399

479,665,000
439.712,700
96.938.000
14.950.600 2,794,900 1,037,300
10.890.000 4,262,000
46.458.000
37.248.000
19,527,300
391,000
2.810.600
9.500.000
1.900.000
1.250.000 4,884,600
43,916,700
271,978,947
138,556,708
106,117,067
711,035,535
847,025,882
58,134,880
18,672,766
278,277,227
566.726.000
452.153.000 136,391,400
14,617,700
2,588,300
1.170,500
10,899,300
5,241,000
50.195.000
43.623.000
18,524,500
433,000
3,235,970
10,018,000
610,000
1.500.000
3.614.000 41,976,375
260,352,955
143,689,794
103,988,445
694,879,130
834,986,838
61,232,280
19,611,430
268,456,053
299.520.000
282.838.300
102.313.300 13,160,500
1,979,800
1,491,300
10,470,100
5,183,000
39.930.000
36.228.000
17.668.000 364,000
3,702,370
2,060,400
29,786,100
Canada's Domestic Exports Calendar Years
704,243,320
816,096,436
66,774,280
21,234,000
272,030,484
250,116,400
18,571,600
34,727,400
6,137,580
210.300 38,200
367.300 5,700
4,901,400
925,500
428,100
61,750
1,192,700
8.164.100 4,525,600
484,300
2,653,400
5.050.100
9.814.000 134,656,600
41,249,500
27,233,800
109,983,400
1.274.000 4,388,500 1,776,600
Canada's Imports Calendar Years
(a) Production Crop Years ended July 31.	(b) Importation and Exportation-Calendar Years. 'Clover seed. tOther clover seed.
1927	1928	1929	1926	1927	1928	1929255,062,200 6,269,900 32,180,700 9.950.200 173,800 13,600 403,400 7,200 4.612.200 1.074.200	365,428,600 .16,037,000 36,773,900 9.937.600 106.900 146,800 388.900 23,400 3,785,400 1.460.600	210,945,600 7,681,500 16,987,700 1,938,300 57,900 154,100 248,600 10,100 4,287,100 1,365,800	130,400 1,794,000 16,100 4,600 40,200 403,500 1,900 12,715,900 279,900	155,800 2,571,000 24.400 62.400 44,735 635.500 12,000 16,204,800 302,300	110.900 3,028,700 2,200 103,300 54,100 301,400 13.900 13,968,300 424,700	1,792,400 3,419,800 154.900 25,500 189,400 220.900 21,100 15,511,600 713,500192,400 54,000	139,200 43,800	143,900 42,800	5,600	7,100	6,900	4,500967,500	992,300	1,554,900	181,800	210,300	211,200	146,8009.415.400 3.663.400 169.300 2,184,900 5,867,479	9,752,600 250,600 32,900 2,950,000 6,199,900	9,241,200 112,800 45,100 850,500 7.244,000	| *2,173,700 J 809,900 16,100,300	[DOT]2,307,500 354,300 18,678,700	*2,122,000 299,700 17,943,100	1522,600 316,500 1,298.000 1.374,300 17,717,6002,696,000 110,533,000	1,994,800 114,152,500	1,400,400 92,946,100	9,151,900 1,218,600	11,208,800 1,720,800	16,801,600 1.778,800	35,928,200 2,103,70040,209,100 56.741.800 82,581,700 1,889,200 11.356.800 448,200	32,006,800 47,136,700 52,354,100 1.127.800 8.350.800 988,500	31,982,300 31,230,800 38,957,400 573,300 6,089,800 1,147,829	151,800 325,027 16,062,301 1,672,900 15,362,900 3,560,400	125,100 249,900 10.706.600 1,946,000 14.353,800 3.226.600	137,300 2,519,100 13,975,100 2,332,571 14,271,200 996,900	178,900 5,235,400 21,506,300 4,401,300 12,086,000 713,300
g
g



The Budget-Mr. Murphy

The Budget-Mr. Murphy
In studying these figures we can readily see that there has been a general decline in production not only in field crops but in animal products. In so far as field crops are concerned we cannot lay the blame on the government. Undoubtedly climatic conditions accounted mostly for the decline, and unfortunately for Canada and the farmer in particular the decline has been costly. The total value of field crops in 1927 was $1,173,133,600; in 1928, $1,125,003,000; in 1929, $979,750,400, or a decline of $193,383,200 in 1929 as compared with 1927. But it is in analyzing the figures of exports and imports, especially in animal products, that we find reason for alarm. Our exports of cheese have fallen in the four years from 134,000,000 pounds to 92,000,000 pounds and our imports have increased from 1,218,600 pounds to 2,103,700 pounds. Our exports of butter have fallen from 9,814,000 pounds to 1,400,400 pounds; and our imports have increased from 9,151,900 pounds to 35,928,200 pounds, a very alarming increase indeed. Surely something must have caused this tremendous slump in our great dairy industry, and upon investigation we find the cause to be the order in council by which New Zealand was permitted to export butter into Canada at one cent a pound duty. It has been argued that the people of Canada are eating more butter per capita. The figures on which this argument is based are mostly estimates, as there are no definite figures for dairy butter production. However, we know for a fact that in a great many counties there is also a marked decrease in the production of dairy butter. The bare fact remains that Canada, since the inception of the New Zealand order in council, has ceased to be a large exporter of butter, has not been able to supply her own requirements and has become an importing country. In view of this analysis, we must lay blame on the government. The present administration by that one act has adversely affected and retarded the great dairy industry of Canada. Our exports of condensed milk and milk powder have declined from 41,249,500 pounds in 1926 to 31,982,300-a decrease of almost 10,000,000 pounds. Worst of all, however, these declines are associated with and dependent upon a decrease in the source of supply, the milch cows, to an extent of over
100.000.	Surely no further proof is necessary to show that so far as Canada is concerned the dairy industry is in an unhealthy condition.
Coming next to beef, we find in the matter of export a decline of 25,000,000 pounds in 1929 as compared with 1927; a decline of
16.000.	000 pounds as compared with 1928, and
at the same time an increase in our imports of 5,000,000 pounds in 1929 over 1927 and
2,250,000	pounds over 1928.
In the matter of pork exports, we find also very large declines in 1929 as compared with the years 1926, 1927 and 1928; we find a decline of 71,000,000 pounds in 1929 as compared with 1926, a decline of 44,000,000 pounds as compared with 1927 and a decline of
14,000,000 pounds as compared with 1928. Surely the exports of pork in these years have been on the toboggan and going down at a rapid rate. These declines are serious enough in themselves but when we find that our imports have risen to 21,000,000 pounds in 1929, an increase of 8,000,000 over 1928, we surely must be forced again to conclude that our pork industry is in a very unhealthy condition.
Taking all in all, these increases of imports and decreases of exports mean the loss to Canada, and to agriculture in particular, of many millions of dollars. It will be argued by members of the government that the home market has been consuming much more of all these products, and they will base their arguments upon the figures of production as given by the Bureau of Statistics, but again I question the accuracy of these estimated figures. The population of Canada has not increased sufficiently during the period under review to account for such great differences in the exports of these agricultural products. Are we to believe that the Canadian people have become so gluttonous that they are consuming the quantities that would be indicated by the above argument?
I for one cannot believe that we have become a nation of gluttons; I prefer to believe that the estimated figures of production are far too high, and I must conclude, Mr. Speaker, that our great basic industry, agriculture, is on the decline and in a very unhealthy condition. This conclusion apparently is shared to some extent by the Department of Agriculture, because at the present time frantic efforts are being made to bring about an increase in the production of agricultural products. At the Royal Winter Fair held in Toronto a few months ago the Minister of Agriculture urged upon the provincial ministers the necessity of bringing about an increase in all agricultural products. Basing my conclusions in so far as agriculture are concerned upon the facts elicited in the foregoing review, I again assert that our great basic industry has reached its peak and is assuming a condition of premature senile decay.
1S96
The Budget-Mr. Murphy

Just here I might refer to our National Research Council, which during the past few years has been making considerable advances. What is the use of that department continuing to pursue its researches if at the same time the government negotiates trade treaties with countries throughout the world which have a tendency to ruin and destroy these industries? That has been the case during the past three or four years.
Referring now, Mr. Speaker, to the budget presented by the Minister of Finance, we are glad to note that he h&s seen fit to adjust the duty on butter, and that he intends to negotiate a new treaty with New Zealand. He has harkened to the protestations of the dairy industry and of the opposition and has admitted that for the past four years the government, through its trade agreements, has been sacrificing the interests of the farmers, and particularly of the dairymen, upon the altar of inadequate protection. Suddenly he has been converted. Whether that conversion has been due to the protests of the Conservative party or whether it has come about because he wished to appease the wrath of the great dairying industry with a view to securing the support of those engaged in this work when the government appeals to the people, is a question which remains to be answered. At any rate the minister has been converted and, Mr. Speaker, what a conversion it has been! The annals of history will record it as comparable to that of Saul of Tarsus. What agony of mind and soul there must have been on that occasion; cold beads of perspiration must have stood forth on his brow as he heard those challenging words, Repent; repent ye, for the judgment is at hand. Truly, Mr. Speaker, it is a deathbed repentance, but one that will not deceive the thousands of farmers throughout this country who for the past four years have suffered from unfair competition for which this government alone is responsible.
I congratulate the minister on at last having seen the light, but I cannot say that my prayers will go with him on the day of judgment.
I should like to refer to the agricultural implement industry, but I have not time to deal with that question more than to make a passing reference. In the budget brought down by the minister it is provided that agricultural implements from the United Kingdom are to be on the free list. This is just one more attempt to deceive the public minid. The importation of agricultural implements from the United Kingdom during 1929 amounted to only about $142,000, while the

total importation of agricultural implements into Canada from the United States amounted to over $40,000,000. This is simply another of those very fine gestures made by the Minister of Finance in order to deceive the people of this country and particularly the farmers of the western provinces.
_ Yesterday I had the opportunity of consulting with one of the manufacturers of agricultural implements, and I asked him what effect this budget would have upon the industry in this country. He said that as far as the change in duty was concerned it would have absolutely no effect, because in the United Kingdom they do not manufacture implements which are required by the farmers of this country. I am sorry I cannot go into this matter more fully, but I just mention this one point in passing.
Now I wish to deal with the woollen industry. In going over the tariff schedules brought down by the Minister of Finance I notice, there is not one reference to any textile item, which seems rather strange after the tariff board went to the trouble of holding a hearing in this connection lasting two weeks, the proceedings of which have been printed in two very large volumes. Representatives of the different industries presented their case and, I think presented it very fairly. Just here I should like to refer to a statement made by the Minister of Finance in delivering his budget address. He said:
Might I submit that were the capacity of our productive units greater than the normal non-speculative demand for our products, there would be cause for alarm, but such is not the case.
This is the test which is submitted by the minister, and during the course of my argument I will show that this applies very forcibly to this great textile industry. Our home consumption is supplied by our Canadian production to the extent of only from 23 to 30 per cent, while the mills in this country are capable of supplying from 50 per cent to 100 per cent of our home consumption, so I think the test submitted by the minister is met fairly well. The woollen manufacturing industry was one of the earliest of the industrial occupations to be established in Canada and developed as an essential and basic form of production. It has passed through many stages of development from the small carding and fulling mills to the fully equipped manufacturing plants of to-day. By the year 1885 there were 107 complete cloth manufacturing

The Budget-Mr. Murphy
establishments in operation in, Canada, distributed among the provinces as follows:
Ontario	 76
Quebec	 18
New Brunswick	 1
Nova Scotia	 10
Prince Edward Island	 2
The industry was established in over 100 towns and villages in eastern Canada, and reached the peak of its development about 1900. It must be admitted that some of the mills were small and uneconomic producers, but on the other hand about 100 of the mills in operation at that time were equal to the average mill in England or elsewhere. The fact remains that since that date Idle industry has failed to expand and develop with the general development of Canada. As a matter of fact it has declined, the estimated drop in the production of cloth being 50 per cent, with the accompanying loss of wages and slowing up of the economic growth of Canada.
The cloth industry was sacrificed by the enactment of the British preferential tariff in 1898, and subsequent revisions. Many mills were forced to close entirely, so that in 1910 there were only 78 woollen and worsted mills in the dominion with 224 sets of cards. By 1926 there were in operation 116 plants, of which 54 manufactured cloth, 17 manufactured yarns, 17 manufactured carpets and rugs, and 28 manufactured miscellaneous woollen goods. In 1901, when the population of Canada was about 5,000,000, the Canadian mills consumed
18,100,000	pounds of raw wool; in 1926, when the population was approximately 9,000,000, they consumed 22,300,000 pounds. In 1929 there was retained in Canada 27,230,245 pounds, a considerable quantity of which is still in store. The figures of production, exports and imports of raw wool are given by the Dominion Bureau of Statistics for the years 1927, 1928 and 1929. They are as follows:
Production-[DOT]	Pounds	Value1927	.. 18,672,766	$4,108,0001928	.. 19,611,430	5,099,0001929	.. 21,234,000	4,247,000Imports-1	1927	. . 14,353,784	4,942.8071928	.. 14,271,154	5,797,5331929	. . 12,086,070	5,126,915Exports-	1927	.. 11,356.848	3,133,0951928	.. 8,350,855	2,973,4331929	.. 6,089,825	1,670,576
From these figures it would seem that for the past three years the number of sheep in Canada has increased with a corresponding increase in the quantity of wool produced, but the figures for the year 1920 show that the
wool clip amounted to 24,000,000 pounds valued at $5,280,000. Requests have recently been made by certain sections of the wool grow'ing industry for assistance in preserving the home market through the restoration of the duties or worsted yarns which were removed two years ago. There is a diversity of opinion as to the suitability of our home grown wools for the manufacture of fine yarns. Undoubtedly Canada can produce practically any breed of sheep, and the Department of Agriculture might serve a very useful purpose in this respect. Wool grading has been inaugurated by that department, and in 1928, 3.452,761 pounds of wool were graded. The department reports that the clip was of particularly fine quality and that it attracted the attention not only of Canadian buyers but of buyers from the United States and continental countries.
From this it would appear that Canada can produce wool of the finest quality. What must be done if this government is desirous of stimulating and supporting the sheep raising and wool industry of Canada? What is the government going to do for the farmer who raises sheep in the hope of finding a market in Canada? Is the sheep farmer to be sacrificed along with the dairy farmer upon the altar of free trade and a non-protective tariff? If the government is to assist the wool producer it is quite evident that more of the woollen goods now used arid imported into this country must be manufactured at home. It is estimated that 70,000,000 pounds of wool would be required to supply the yarns for all the woollen goods consumed in Canada, and yet, with a production of only some 20,000,000 pounds per year, the wool producer finds that his home market has been destroyed by the tariff policy of this government. The time has come-in fact it is long since past-for a revision of the tariff policy with respect to the woollen industry. More protection must be afforded if this once great and basic industry is to survive and prosper. Such a revision would aid the farmer and the sheep rancher; it would stimulate immediately the woollen manufacturing industry, and would furnish employment for thousands of male and female labourers who have been thrown out of work and forced to seek employment in the great republic to the south. It would make the machinery hum in mills which are now idle, and would restore the life blood to many small towns and cities which were once the homes of prosperous industries.
In considering the cloth industry, it is necessary to distinguish between those factories which manufacture woollen goods, such as

The Budget-Mr. Murphy

tweeds, overcoatings, blankets and yarns, from those manufacturing worsted goods. The cloth industry has suffered most from importations. In 1925 the total consumption of cloth in Canada amounted to $36,014,287, of which $11,653,477 or 32 per cent was of Canadian manufacture. In 1927 the total consumption amounted to $39,659,338, of which $11,504,654 or 28 per cent was of Canadian manufacture. These figures show that the Canadian mills supplied in 1925 only 32 per cent of the needs of the Canadian market, and in 1927, only 28 per cent. This indicates a very serious condition, especially when it is considered that these mills are capable of supplying about nineteen to twenty million dollars' worth of goods, working eight hours a day for 304 days in the year. In other words, if they supplied only one half the needs of the Canadian market their employees would have received full time employment. It will be asked why the Canadian mills were not able to supply that quantity which would give their employees full time employment. The answer is that the laid-down cost of imported cloths is somewhat less than the price at which similar goods can be produced in Canada and sold under present market conditions. This difference is due to the lower costs of production of the imported cloths, and not because our Canadian mills are not properly equipped and operated.
The difference in costs of manufacturing in Canada and the United Kingdom is made up as follows:
1.	Difference of rates of wages in direct labour, indirect labour and fixed charges; the latter due to: (a) lower wages paid in manufacturing mill supplies, doing mill and machinery repairs, erecting mill buildings and operating rail transport; (b) better construction of buildings in Canada to stand the climate-heating, et cetera; (c) duty paid in Canada on machinery and repair parts when imported, and sales tax paid on duty paid value; (d) sales tax paid in Canada on building materials.
2.	Present conditions prevent the standardization of product which prevails in England and Scotland.
The wages paid in Canada to mill employees are about two to two and a half times as much as the wages paid in the United Kingdom, and about six times as much as the wages paid in Japan. A deplorable condition exists in this great basic Canadian industry. Does the government desire to help or is it its intention to retard and ultimately destroy the woollen cloth industry? Is this industry to be forced to reduce its wage scale to that paid in the United Kingdom in order to re-

main in business? Such a reduction would be impossible in Ontario as far as female labour is concerned on account of the minimum wage laws. Surely this government does not desire to reduce the standard of living of mill employees.
In 1885 this industry had 107 mills in operation, while in 1926 there were only 41 mills still in production. Those 41 mills had a capital investment of $17,548,074; they employed 3,843 people and paid out in wages a total of $3,395,827. What is to be done? What are the mills asking for in order that they may survive? They have not asked for the abolition of the British preferential tariff, but they ask that the rates be so revised that they may obtain a more reasonable share of the Canadian trade.
At the outset I said that we must distinguish between woollen and worsted cloths. Because of the abolition of the duties on worsted yarns, the worsted cloth industry has been benefited temporarily, whereas the woollen cloth industry is left to bear the burden of increasing importations. Woollen cloth mills have not benefited by reason of the revision because of the difficulty in securing the adequate and satisfactory supply of woollen spun yarns necessary for cloth weaving purposes. There is nothing like the degree of standardization in either yarns or fabrics in the woollen cloth industry that there is in the worsted industry. In fact, it is practically impossible for a woollen cloth mill to operate successfully without its own preparatory carding and spinning equipment, which constitutes about 60 per cent of the investment in the mill.
Conditions in 1925 and 1926 were bad enough, but they are even worse to-day. Many mills have been forced to close down, while others are operating on part time with a decreased number of employees. The increased importation of low grade shoddy woollens from the United Kingdom and Europe is slowly but surely strangling the industry. If our woollen mills are to survive, something must be done to prevent these heavy importations.
Both the woollen and worsted cloth industries require yarns made from the raw product-wool. While the worsted cloth industry may temporarily benefit from the free importation of worsted yarns, it tends to destroy the demand in this country for raw wool, thereby striking a serious blow at the sheep growing industry. Surely this deserves consideration at the hands of this or any other government. As I have said before, the woollen cloth mills must manufacture their own yarns if they are to produce the various kind of woollen cloths.

The Budget-Mr. Murphy
Now let us consider what is happening in the yarn branch of the industry. The Canadian consumption of yarns in 1925 amounted to 15,812,501, of which the Canadian production was $2,500,000. In 1926 the total Canadian market for yarns was $7,043,325, of which the Canadian mills produced $3,505,077 worth. This is divided as follows:
Canadian
production Imports
Dry spun	 $837,678	$2,250,000
Or only 23 per cent was of Canadian production.
Oil spun	 2,667,399	1,288,248
It will be observed that Canadian mills produced only 23 per cent of the total consumption in Canada of dry spun yarns. Why is this? It is because these yarns have a duty of only one-tenth of one per cent on account of the drawback of 99 per cent.
When one considers that the estimated capacity of the Canadian mills was 80 per cent greater than their production during that period, it is readily appreciated that they were operating under very adverse conditions. Those conditions grew worse in 1927, 1928 and 1929. The importation of yarns in the last two of those years is as follows:
Importation
Fiscal year-	of yarns
1927- 28	 $4,356,000
1928- 29	 5,790,000
I therefore submit that if the wool growing branch of agriculture is to survive the small market for it, it must receive protection through yarn producing and cloth producing industries. The Canadian Woollen and Knit Goods Manufacturers' Association have asked that the drawback of 99 per cent be removed.
I would like to refer shortly to the manufacture of woollen blankets. The figures are as follows:
Canadian Production
1925	(Dec.)	
$1,281,9221927	(March)	
1,492,774
Imports
1925	(Dec.)	
611,7091927	(March)	
631,154
The bulk of Canadian production is made up of grey and fancy colour all-wool blankets. In 1927, Canadian mills manufactured about $275,000 worth, or about 33 per cent, of the Canadian consumption of white blankets, a staple commodity. The great bulk of the imports is in the staple white wool blankets. They are imported chiefly by wholesale, mail order and departmental stores and constitute the great bulk of this business at prices below 2419-1201
those which the Canadian mills can quote, in most instances below the cost of production in Canada, without any difference in quality. The grey and coloured business is comparatively small on separate lines and is very competitive between Canadian firms. Why, it may be asked, can the Canadian mills not get the white blanket business? Simply because the costs of production are higher in Canada on account of higher wages, et cetera, and therefore Canadian mills are entitled to more protection if this industry is to survive against foreign competition.
I have arguments to show that by increasing the tariff protection on these various lines we would not increase the price to the consumer. That has been the experience in Australia where the preferential duties were raised in order to protect their own industry, and in fact the price to the consumer was lower in a majority of instances. Unfortunately, however, I have not time to go into this.
Tn my constituency the woollen industry was once in a thriving condition, but owing to the tariff tinkering of the present administration some of the mills have been forced to close down, while others are working only part time. Many female and male employees have been thrown out of employment. Houses that were once the homes of contented and happy families have been deserted and are now unoccupied. This basic industry is on the decline and it will continue to decline unless the government revises its tariff policy. Therefore I appeal to the government so to revise the tariff schedules of the woollen industry that these mills may once again become the abode of a prosperous and healthy industry.
Prosperity is in the pay envelope. The pay envelope contains both demand and consumption. The wealth of a nation will depend upon the extent to which it can provide productive employment for its own people. The creation of wealth or prosperity in its broader sense is the application of labour to raw material. In Canada we possess great natural resources, the development of which is but in its infancy. To turn these into national wealth we must make use of the following classes of labour:
(a)	Men engaged in industry.
(b)	Women engaged in industry.
(c)	Men engaged in agriculture.
The whole economic and fiscal policy of the government should be directed toward the employment of as many as possible in these three groups. How can we do this in so far
The Budget-Mr. Murphy

adult. He may be courageous; be may be brave; he may be imbued with noble and lofty sentiments, but not having maturity and strength he must fail in the contest. And thus, Mr. Speaker, young Canada must fail unless assistance is provided to make the contest equal. Our growing industrial fabric requires support and assistance to overcome that inequality of conditions brought about by lower foreign standards, and that assistance can only be rendered in so far as the government is concerned in a sympathetic and protective fiscal policy. That does not necessarily mean that the tariff should be raised so high as to eliminate fair and equal competition, but it should be sufficient to counterbalance the differences that exist as a result of those lower standards. I have no fear for Canadians when they engage in a fair contest. The history of our country will furnish sufficient evidence on that count. Let us then be fair to Canada. Let us have a policy that gives Canadian workmen and Canadian industry an equal chance in this great world struggle. Let us, where there is any doubt, give Canada the benefit of the doubt and establish once and for all time that confidence so necessary for the progress and development of our country.
. At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Mr. LIGUORI LACOMBE (Laval-Two Mountains) (Translation):: Mr. Speaker, I
flatly deny the right of the hon. member for Vancouver Centre (Mr. Stevens), to teach a lesson in administration to whomsoever it may be, and particularly to the present government. The hon. member would have been better advised to have kept his eye on the administration of a certain company which, thanks to a memorable bankruptcy, lost thousands of dollars of the Canadian people's savings. The effects of the bankruptcy of this company, of which the hon. member was the financial sponsor, was felt as far as the county of Laval-Two Mountains. I well know that this wretched infant, dressed in all its finery and displaying its seductive charms, won over the heart of one of my constituents. I also recall that this person after having had golden dreams, awoke one morning facing the sad reality: he had lost everything. I shall not say anything further with reference to. the hon. member for Vancouver Centre, but quote to him the proverb always true: "Doctor heal thyself."
"It is a great satisfaction for any Canadian" wrote Mr. Beatty in "L'lllustration economique

et financiere" "to be able to record that Canada after 10 years of peace, has assumed a new and greatly strengthened position in the world of finance."
Indeed, we have but to glance over the budget as brought down on May 1, by the hon. Minister of Finance (Mr. Dunning) to find out the whole truth of this statement. A decrease, within five years, of $257,800,000 in the national debt; a reduction in taxation of nearly $100,000,000 for the years 1926, 1927, 1928 and 1929, alone; a diminution of the sales tax equal to $22,000,000 in the savings of the Canadian ratepayer, for the present fiscal year; a favourable balance of $44,507,000 and a reduction of $80,000,000 in Canada's debt this year.
These sir, are the great outlines of the excellent work of this government.
Was it not Sir Thomas White, ex-Minister of Finance in a Conservative government who, a few days ago, put this country in the seventh place among the nations of the world? Was it not the same, well-informed financier who, in a generous display of sincerity, acknowledged openly his admiration for the present administration? I how wonder what Sir Thomas White will think of the speech delivered by the hon. leader of the opposition? I also wonder what will be the effect of the speech of the leader of the opposition on the ultra imperialists, and they are numerous in the party led by my hon. friend. Answering a question put by the right hon. Prime Minister (Mr. Mackenzie King), the leader of the opposition said: "I am for the British Empire next to Canada." Will my hon. friend repeat these words, in all circumstances, at all times and everywhere in Canada?
I well recall his last touring of the province of Quebec. I also remember that the hon. leader of the opposition, during the summer of 1928, succeeded in gathering the fabulous number of 1,500 people about ten miles from Montreal, at Laprairie, in the riding of my hon. friend, the member for Laprairie Napierville (Mr. Dupuis); but I especially recall the words uttered at Waterloo by the hon. leader of the opposition, when he said: French Canadians who hear me, remember that back of your threatened liberties, back of your minority rights, rises this mighty power which we call the British Empire.
Either the leader of the opposition was sincere or he uttered what he did not wish to say. If he is sincere, it is a case of bringing out the old proverb: "How you have changed Agnel." If he was the victim of a "lapsus linguae" he should ask that corrections be made or else retract. Otherwise, I well know

The Budget-Mr. Lacombe
that the honourable members for Wellington South (Mr. Guthrie), for Fort William (Mr. Manion) and the whole advanced guard of the proud Sicambrian will exclaim: "bow down, worship what you have burned and burn what you have worshipped!"
"To me," writes the president of the Canadian Pacific Railway, "it is unthinkable that Canada should ever be anything but an integral part of the British Empire.
Many years ago, the late Cecil Rhodes of South Africa, whose vision was indisputable, ran an eloquent finger across a map on which was shown Great Britain and its dominions, with South Africa at one base of the arch and Australia and New Zealand at the other, and he pointed to Canada as the keystone of that arch. That, gentleman, is a position which some Canadians, possessing more than ordinary vision, conceive to be its position in the future, a position of economic and political prominence among the nations which form the British Empire. I could not, indeed, speak eloquently of our national policy even if it were advisable to do so, however, I must confess that there is something in the picture of a strong interdependent British Empire, with its traditional standards in public life, in finance and in commerce; with its regard for justice, for law and order, that carries a certainty of increasing power and influence.
Permit me, sir, to set side by side the masterful statement of this eminent business man and financier, with the magnificent stand taken by the hon. Minister of Finance. Through his budget, he has eloquently proclaimed our proud trade position throughout the world. Can we do otherwise than keep up our excellent economic relations with the countries which are sympathetic to us? Have we any other attitude to take than to treat in a friendly way the nations which are well disposed towards Canada?
What did the Conservative government do from 1911 to 1921, in order to improve the lot of the farming class? Did it ever amend the tariff so as to protect this basic industry? No, never. It does not behoove them now to complain. We have seen them at work. The Canadian people were the victims of their squandering policy. Prolific in election promises, doctrinaire in matters of tariff; lavish, extravagant, diligent in emptying the public treasury; past masters in taunts, while remaining sycophants of the masses; demolishers of the splendid national spirit which Sir Wilfrid Laurier and his government had set up; parasites trying to disparage-to their advantage-the favourable comments which have
given rise, from the Atlantic to the Pacific, the first budget of the Hon. Charles Dunning; craving for power and changing their attitude from day to day on economic questions of the utmost importance; time servers, propagandists of electioneering literature where too often the facts and truth are defaced, they desire but, one thing: live again in abundance to their hearts content, thus bringing joy to their favourites, but misfortune to the Canadian people.
The right hon. Prime Minister has just announced an appeal will be made to the people. We have known for a long time the tactics of our opponents. We are aware of the kind of struggle we shall have to face. We have no fear, knowing that the Canadian people will judge the government and its supporters, in the light of facts, healthy development and wonderful progress in trade, finance and thriftiness for which the King government is responsible. We have no fear, fully knowing that the budget of May 1, 1930, will meet the exigencies of all classes in the community. Furthermore, when our fiscal policy is dealt with and revised it will turn out to the advantage of the Canadian ratepayer.
Following up my remarks, I wish to draw the attention of the house to the tariff which deals with fruits and vegetables. On behalf of the truck gardeners of the riding of Laval-TwO Mountains, I want to warmly congratulate the Minister of Finance for having so generously responded to the just claims of our good truck gardeners. From the very outset of my career in the parliament of Canada, I drew the attention of the government on this all important problem. I put forth the complaints which reached me.
In January, 1929, I had the privilege of meeting the truck-gardeners of the province of Quebec at a congress held in Montreal. They exposed to me their needs. At the beginning of the 1929 session, I moved a resolution asking this hon. house to enact a seasonable tariff. In taking this stand, I conformed with the views of the truck-gardeners. This seasonable tariff was to be applied only during certain months of the year. On the suggestion of the late Hon. James Robb the tariff commission inquired into the claims of fruit and vegetable growers. The distinguished economists who are on this commission declared the claims of the truck-gardeners to be well founded. They gave proof of an admirable spirit of fairness. So much so that the government through its finance minister grants not only what we had requested but further gives the truck-gardeners the greatest possible assistance, fairplay and

The Budget-Mr. Lacombe
protection. A countervailing tariff on all American vegetables coming into this country; combined tariff, ad valorem and specific, on the same products. To avoid any controversy on the subject, I shall quote verbatim that part of the budget which deals with the tariff on fruits and vegetables:
In revising the customs tariff on fruits and vegetables^ the government has given serious consideration of the representations of growers and consumers, as presented on several occasions before the Tariff Advisory Board. The irregular nature of the severe competition which Canadian producers frequently face from the earlier-maturing crops of other countries has been weighed in the light of various suggested remedies, most of which were found to have inherent defects, a fact long since recognized by the growers themselves. Seasonal tariffs, for instance, are not applicable to a country such as Canada, with its extremes of distance, latitude and climate.
After careful study of the situation from all angles, we have decided to apply to fruits and vegetables a combination of specific and ad valorem duties; this combination will, it is believed, meet the urgent need of the growers during those periods when they suffer from acute instability of prices and, at the same time, guarantee to consumers, at all seasons of the year, supplies of these products at reasonable prices.
The ad valorem rate on fresh vegetables is retained at thirty per cent under the general tariff and specific minimum duties will be effective, under the general tariff, on all except green peas and green beans.
All fresh vegetables of domestic character are made free of duty under the British preferential tariff.
I am glad my hon. friends approve. In taking this action, we have had in mind the growing' ability of Bermuda and the West Indies to supply the Canadian market during the Canadian off-season, a possibility which is rendered more feasible than before, now that Canada has her own direct steamship connection with these islands, employing vessels which are specially built for efficient transportation of perishable commodities.
For electioneering purposes, our opponents already seek to incite certain associations to protest against the new tariff on fruits and vegetables. The Eastern Canada Fruits and Vegetable Jobbers Association contend that the house-keeper will have to pay for a cauliflower 40 cents instead of 25 cents, and celery will sell at 25 cents and never again at 15 cents; tomatoes at 21 cents instead of 15 cents.
Furthermore the Western Fruit Jobbers Association, also protest because, they say a tariff of 1 cent per pound will be levied on cabbages, rhubarb, cucumbers, spinach, and a tariff of 2 cents on cauliflowers, tomatoes and celery.
Let these associations be without fear! The government states the Minister of Finance, has provided for this by granting greater facili-
ties to stock the Canadian market, during the slack season, from Bermuda and the West Indies.
I am highly pleased to note that the government has remembered, as it always does, our farmers who provide us with milk, butter and cheese. Our dairy industry plays a leading part in the prosperity of the nation. Our farmers have rejoiced over the duties to be levied on butter imported from New Zealand and the bill providing for the cancellation of the treaty between Canada and that country. This sound policy will give rise to great hopes and generous emulation among the farmers of our rural districts. Through agriculture we will promote our prosperity and insure our survival as a nation. Thanks to a remarkable development of agriculture, the consumer and city worker will find on his table products grown on Canadian soil and at reasonable prices. Both the toilers of the land and city workers, in perfect harmony, will endeavour to build up a Canada constantly gaining in happiness, prosperity and greatness.
In closing my remarks, Mr. Speaker, you will, I trust, pardon my indiscretion if I state that an incomparable inspiration of patriotism has prompted the beautiful pages which you wrote on the anniversary of the fourth century of the discovery of Canada. You have been presiding for nearly ten years over the proceedings of this house. You have been occupying a seat in this parliament for the last thirty-four years. You have watched over the economic, agricultural and industrial development of our young and vast country. Our political evolution hides no secrets from you.	When a few moments ago I was
glancing over the admirable lines whose author you are, I was thinking of the immense advantages that Canada would derive from the realization of your ideals. "Memorial to the Discoverer" ("Le monument du Souvenir").	What a noble and1 generous
inspiration! To gaze on a past denoting strength and filled with heroic deeds, sailing with spread canvas in the royal wake of future, such must be the inspiration of all true Canadians.
In a masterly description which will do honour to your compatriots, the House of Commons and the " Institut de France " of which you are one of the distinguished members, you take us with you across your beloved Gaspe peninsula, the cradle of civilization and the gospel in New France. Then, foreseeing the splendour of the great manifestations and the unbounded joy of a nation deeply moved and thrilled, " already "-you say-I see the crowds moving towards the Gaspe peninsula.

The Budget-Mr. Edwards (Waterloo)
It is the beautiful month of July, the third or fourth day (tiers jour ou le quart) as Jacques Cartier so delightfully puts it. Automobiles form lines basking in the glorious sunshine of the coast. The bluish tinted capes stretch far out to sea; the pleasing mounts display their rounded crowns. Ships, aeroplanes gather from everywhere, swiftly splitting the rocking waves. Trains rolling in the dust from one coquettish village to another. And innumerable pilgrims, pilgrims of the memorial and pilgrims of the faith, halt over there, at Gaspe, close to the secure harbour (hable soeur) along the basin, between graceful hills. Piously, they move across the threshold of the cathedral whose cross is erected on the point (poinct), on the very spot where, four centuries ago, in the primitive forest, Jacques Cartier erected his wooden cross thirty feet high (haulte de trente-pieds) in the midst of his mariners (mariniers), the humble toilers (laboureux) of the sea, and the naive and astonished Indians.
In this beautiful literary work, you have mingled the zest of the distant past to the progress of the present. Canada, an autonomous unit in the British Empire, deems it its duty to continue under the jEgis of our new prerogatives, in peace and harmony, its ascending march towards prosperity.
Notwithstanding the despondent cries of braggers and vilifiers of their own country; notwithstanding the sharp steel of the bombastic voice of the hon. leader of the opposition! It crumbles as it strikes the granite of the present budget. We are witnessing the spectacle of a defeated army, disarmed and disabled opposition, which awaits an impending and inevitable defeat.


Mr. A. M. EDWARDS (South Waterloo):: Mr. Speaker, I regret very much that I was not able to follow the arguments of the previous speaker (Mr. Lacombe). That, of course, is my misfortune. But judging by the applause which greeted his remarks from that side of the house, I presume they were very much to the liking of his colleagues.
In rising to speak in this debate I do so not so much to deal with what is contained in the budget as with what is omitted from it. The activities of this government seem for some years to have been devoted to assisting almost every country in the world but Canada. Agriculture has been embarrassed by treaties which in every instance have reacted against the Canadian farmer. Manufacturing industry has been embarrassed by a continual tinkering with the tariff. This brought about uncertainty in all lines of business, for no one knew
just where the next blow would fall. Then in turn capital became alarmed; in fact it has been withdrawn in many cases, and certainly it is not available at the present time to take its part in the improvement of industry. Each year some industry has been crippled. For three or four years I have in my speeches in this house dealt with the textile business. I predicted in 1928, when the 12i per cent duty was taken off worsted yarn, that the worsted cloth business of this country would be very seriously embarrassed if not badly crippled, and it is with the object of putting the position of that industry before this house and before the people that I have risen to speak on the budget.
By the budget items, so searchingly reviewed by the hon. member for Vancouver Centre (Mr. Stevens) this afternoon, the secondary industries in iron and steel have been seriously affected; for instance, such an industry as that making vitreous enamelware, and the washing machine industry. In the case of the industry building children's wagons and sleds, whose business is almost slaughtered by importations from the United States, the government have seen fit to reduce by an additional five per cent the tariff on these goods coming in from the United States. The difference between five per cent or seven and a half per cent, I am assured, is pretty nearly the difference in this industry between success and failure. In many cases, according to our manufacturers, toy wagons in the United States have been coming into this country undervalued. The Minister of National Revenue (Mr. Euler), has assured the house that with respect to furniture coming into this country undervalued for duty purposes, the fair market value in the country of origin will not be taken as the fair market value in Canada owing to the different conditions prevailing in the country of origin. That being the case, if he has the power which he says he has to raise the valuation for duty on furniture, I trust he will give that relief not only to furniture which is so largely manufactured in the northern portion of the county which he has the honour to represent in this house, but also to other industries which are suffering from similar unfair competition, as makers of wagons and sleds for children and many other lines.
Articles such as enamelled kitchenware, which this budget reduces from a 20 per cent to a 10 per cent British tariff, will flood this country. That is all well and good; no one wishes to bar English whiteware enamel from this country, nor do we want to bar the white-ware from any other country. However, where the importation of this product interferes with
1906	COMMONS
The Budget-Mr. Edwards (Waterloo)
the product of the Canadian factories, deprives Canadian workmen of their means of livelihood and floods this country with ware that is manufactured under different conditions of labour, we have first to attend to the interests of the Canadian people. As I understand it, we are not here to legislate for any other country; we are here to look after the interests of the Canadian people. As I understand my mission in this house it is not to help pit one class of industry in this country against another; I am not here to pit the manufacturer against the agricultural worker. Our purpose must be to give every industry a fair show. Where there are such conditions as obtain in mid-European countries, and in England, where wages are very much lower than they are here, and in many midEuropean countries where the standards of living are very much lower, to my mind it is not a case where the tariff or the fiscal policy should be changed to allow the articles from these countries to enter Canada in unfair competition with Canadian made goods. Anybody who has had anything to do with employing labour knows that it is very difficult at the present time to keep this labour employed. Personally I do not understand how a great number of the labouring people are getting along. Wages are not excessively high by any means; on the contrary, they are excessively low when we consider the Canadian standard of living and the money it takes to educate a family in this country in a decent manner. So much for that part of the budget.
In the southern portion of the county of W aterloo, which I have the honour to represent in this house, we have a highly industrialised section, and one that might be regarded as almost perfectly balanced. We have an extensive rural community largely composed of prosperous farmers, and ninety-five per cent of the produce of the farms in that county and in the surrounding counties is consumed in the counties themselves. To my mind that is an ideal situation and one which the Minister of Finance might well have kept in mind when he was framing his budget; the ideal situation would seem to be where there is, as nearly as possible, a balanced community of consumers and producers.
I wish to say a word or two about the dairying industry. A much belated attempt has been made in this budget to right a very grievous wrong done to this industry, which has been very largely destroyed by the huge importations of butter from New Zealand. If this budget is not too late in its attempt 
to revive the dairying industry I trust that dairying will be put back on a proper foundation. I have many letters from farmers in South Waterloo complaining about the very unfair competition of New Zealand butter making what was a very lucrative part of their business only a shadow of its former self. Perhaps I might illustrate the condition of the dairying industry in that section of the country by giving to the house the prices of churning cream, which controls the price of butter. I shall give the price per pound of No. 1 churning cream for the first four months of 1930 as compared with the first four months of 1929:
January. February March.. April.. .
Price ] 1929
46J cents 48 cents 48 cents 48 cents
pound
40J cents 39| cents 39 cents 35 cents
I wish to point out that in the month of June, 1929, when the grass season was at its peak, the price of churning cream was 49J cents. In April of 1930, when cattle had to be fed, housed and cared for, the price of churning cream was 35 cents. That comparison will give the house a very fair idea of what the producer of butter has to contend with. So long as this vacillating policy continues of not knowing just exactly what is going to happen next and what industry is to be affected next, just that much longer will it take for this dairy industry to be put back on its feet. I trust that the present government have had sufficient experience with this New Zealand agreement during the past four years never again to interfere with the dairying industry in this country.
During tne last three or four years I have on several occasions referred to the textile industry, and more particularly that part of the industry relating to woollens and worsted cloths. In the constituency from which I come there are two very large industries of this nature and several smaller ones. One of the large industries which formerly employed between 800 and 900 people is now employing four or five hundred people, who are working only on short time. I may say this is almost entirely due to the fact that in 1928, this government took off the 12J per cent protection on worsted yarns, and in an industry of this kind, where wool was washed, combed, carded and spun into yarn, with the heavy work being done by the heads of families and the work at the looms more or less handled by female help, one can understand the serious situation which was created in

The Budget-Mr. Edwards (Waterloo)
towns with a population of from 2,500 to
3,000.	That is only one instance. In another factory in another town, where 270 people were employed in making woollen cloths, as distinguished from the worsted mill, since last November they have been working four days a week, and they do not know just where they are heading at the present time. Certainly they are losing a great deal of money. Hon. gentlemen can readily understand that in small towns where they have one or two of these industries this is a very serious matter, and if any words of mine are taken by the government to indicate the gravity of the situation. I shall be well content.
The condition of the woollen industry in Canada continues to be such as to give the greatest concern to those who have a sincere interest in the future of this industry. The attempts made by the present government during recent years cannot be described as other than futile and complete failures instead of being helpful measures for this important industry, as no doubt they were intended to be. Undoubtedly Canada has vast potentialities for greater and more comprehensive development in every line of industry and this woollen industry, which is fundamentally next to the great agricultural industry, is very important to the country at large. Now the situation is that one of the most flourishing of our great industries for years has been almost hopelessly struggling to avoid being completely submerged by the unfair competition to which it has been exposed. The importance of this industry was vividly impressed upon the people of this country during the stress of the war period, when the need for native sources of supply to meet the actual clothing requirements of our civil as well as our military population was emphatically brought home to all who were old enough to be impressed with this matter.
On former occasions I have alluded to the inadequacy of the attempts which have been made by the government to enable this branch of Canadian industry to make progress. It is clear to me, as it is clear to others who are located in communities where woollen and worsted manufacturing plants have been struggling bo continue in operation against great odds, that the warnings issued by those who were qualified to know what would be the effect of various changes introduced by the government did not receive from the government and its advisers the consideration which they deserved. From any action which has been taken by the government, these warnings from qualified, sincere and responsible men, to which it was frequently compelled to listen,
might as well have been the cries of immature and irresponsible children. No constructive action has been taken by the government up to this moment; such palliative measures as have been introduced have turned out to be anything but constructive in the final analysis. As a matter of fact they have been destructive to the well-being of the industry and to the welfare of the many citizens of this country who had a right to look to this industry for their livelihood.
Just here I should like to refer to the meetings which were held between the representatives of the textile industry and the tariff board. These representatives appeared on several occasions, and each time presented their case to what was thought to be a sympathetic board. In fact one prominent member of that board, to my certain knowledge, said he realized that the textile industry in this country had not been fairly treated, but no measures have been adopted looking to the relief of that situation.
Just what is the condition to which we have been brought by these ill-advised and badly conceived measures? If the government is cognizant of the effects of its past attitude on .the woollen and textile industry in this country, with its vast potentialities, the government must know that these warnings to .which it has listened from time to time were worthy of greater attention than they received. I have absolute knowledge of the situation in my own constituency as well as in other parts of the country, and I know I am not misstating the facts when I say that to-day there is not a single wool combing plant in operation in Canada. Wool combing machinery which was installed in various worsted mills at a cost of millions of dollars and which, in the .past, combed millions of pounds of wool from Canada and other parts of the British Empire, at present is not being worked to 5 per cent of its capacity, and the numerous employees of these combing plants have been obliged to seek employment in other lines of industry which, as everyone knows, is not easily found with conditions as they exist to-day. Visit any of the combing plants in Hespeler, in Sherbrooke, in Campbellford, in Guelph or at any other point, not to mention that other large plant in Trenton which within the past year or two has been completely dismantled, with the machinery shipped to the United States; seek confirmation of this statement, if you will, and you will find the fact to be as I have stated. There is not one of these plants at present consuming five per cent of the wool which it
1908	COMMONS
The Budget-Mr. Edwards (Waterloo)
could consume if this industry received proper consideration from the government. They are all practically closed down.
Not only has the wool combing industry of this country been given the quietus, but the worsted spinning plants of the whole Dominion are rapidly going into the discard and millions of dollars invested capital are being rendered unproductive. Hundreds of the employees of these spinning mills are only working a few days a week if, indeed, they are fortunate enough to have any employment at all in this industry for which they have been trained. I feel absolutely warranted in stating that the spinning equipment for woollen worsted yarns in Canada is not being employed at present to one half its normal day work capacity, and now I am speaking only of those mills which are fortunate enough to be working at all. A number of these well equipped spinning mills with the latest machinery are completely closed down, with not a wheel turning. The Orillia worsted spinning mill, with its 5,000 spindles, is a case in point. The worsted spinning plant at Milton is also completely closed, and scores of people in these places have left the industry altogether; 110 or 115 hands in Orillia have been forced out of employment. With all the spinning plants in the Ontario mills thus suffering from want of work, we have the same reports from the industry in British Columbia and in the eastern provinces.
Hon. members should bear in mind that this condition has not been brought about because we have an over-supply of such factories or equipment in Canada. We have not enough spinning machinery in Canada to take care of our normal requirements. The fact is that while our present mills are standing idle the importation of woollen yarns, already spun abroad in mills where the wages paid are much lower than those in Canada, is continuing to the extent of millions of pounds
Combed wools and noils	
Woollen and	worsted	yarns	 lbs.
Carpets and rugs	
Woven fabrics to be	dyed and finished in
Canada	 sq. yds.
Tweeds	 yds.
Worsted and	coatings	 yds.
Wearing apparel	
In other words, sufficient cloth was imported last year into Canada to make more than one suit of clothes for every adult male in the country. Most of us are not able to purchase more than one suit of clothes per year, so what is left for the Canadian mills?

annually, creating a competition which it is absolutely impossible for our mills in this country to meet if they are to continue to pay living wages to their employees and meet the obligations imposed by Canadian standards. Not only are yarns worth millions of dollars coming to Canada free of duty for weaving purposes, but in addition yarns for further manufacturers of wool cloth still flood the market, coming not only from Great Britain but from mid-European countries as well, to the detriment of Canadian industry and in many cases to the detriment of the ultimate purchaser of the goods owing to the inferior quality of the imported product, which in many oases is made of wool substitutes and which has no wearing qualities when made up into garments.
The 12J per cent duty which was taken off wool and worsted yarn figures amounts to less than 80 cents per suit of clothes manufactured. That amount is being taken away from the Canadian workman and given to the man who manufactures the clothes. Will any lion, member in this house say that the saving of 80 cents per suit of clothes is passed on to the consumer? I do not think that anyone will make such a statement, because it would be absolutely false. Nothing is being received in return for the putting out of business of this great industry. The statistics which I propose to submit will verify the serious condition which exists in the woollen industry. There is also the further underlying fact of an additional loss to Canada of the ultimate consumption of raw wool which the vast areas suitable to the production of wool and mutton are capable of producing. No student of the situation can overlook this feature.
I would like to give the house some official statistics with reference to the importations of woollen and worsted goods for the twelve months ending with February, 1929, and February, 1930. The figures are as follows:
1929-	-Value	1930-	-V alue
	$ 5,869,404		$ 4,012,720
5,103,875	5,714,542	5,820,504	5.895,431
	3,429,000		3,285,652
4,273,684	1,765,582	3,273,913	1,308,9624,261,898	4,155,176	3,169,898	2,909,84710,597,822	13,966,096	8,307,560	10.994.3425,301,816	5,076.423
The official figures show that the value of combed wools imported into Canada for spinning in the worsted yam mills was $4,012,720 for the twelve months ending February, 1930, as against $5,869,404 for the twelve months ending February, 1929. The weight of

The Budget-
-Mr. Edwards
(W aterloo)
combed wools is not given in the returns. These figures show a marked drop in the business of the spinning mills of Canada, and the opening months of 1930 indicate a further decline. The fact that the importations for the last period of twelve months have dropped about 4,000,000 pounds does not signify that there has been increased production in Canadian weaving. Business conditions have been such that while imports have decreased the production of cloth in Canadian mills has shown no appreciable increase. The figures I gave for woollen and worsted yarns include weaving yarns, which are free of duty; knitting yarns, with a duty of 124 per cent, and other yarns with a duty of from 124 per cenlt to 20 per cent.
With the permission of the house, I will put on Hansard some figures showing the importations of woollen and worsted goods into Canada for the months of December, 1929, and January, February and March in 1930, these being the last months for which figures are available. This statement is as follows:
This summary from Department of Trade and Commerce Reports of Canada includes woollen blankets, woollen and worsted yarns for all purposes; woollen and worsted woven fabrics such as flannels, overcoatings, tweeds, serges, coatings, fancy worsted suiting and plushes.
This does not include knitted goods nor ready to wear garments of woven or knitted materials.
Figures as to quantities denote pounds in the case of yarns and yards in the case of woven goods. It is assumed that the average weight of woven woollens and worsteds would be about one pound per yard, so that the quantity figures herein will approximately represent the weight of all yarns and woven woollens, exclusive of knitted goods or ready to wear garments of wool.
Quantity in	Value
yards or pounds in dollars in Imports in four months in four months four months
Great Britain. . .
France	
G ermany	
United States. . .
Italy	
Belgium	
Netherlands. . . . Czechoslovakia. . . Switzerland. . .	.
Poland	
Japan	
British India. . . Austria and Hungary
Sweden	
Irish Free State. .
7,040,414	$7,568,257
1,103,807	987,972
322,314	390,768
233,747	313,855
136,618	70,646
110,191	58,318
37,923	72.961
26.847	36,239
11,891	13,651
1,637	1,930
2,923	1,040
1.656	2,972
1,124	3,547
6.026	6.788
2,110	4,096
Total	 9,039,228	$9,533,040
A kindred and interlocking industry with the woollen and worsted industry is the wool producing industry. This branch of agriculture is at a very low ebb, largely due to the fact that huge quantities of yarn are being allowed
into Canada on the free list, thus throwing hundreds of spinners and combers out of employment. The makers of worsted clothing can bring in yarn from Great Britain at a lower cost than it can be produced in Canada. This is possible due to the lower wages paid in English and European mills. The following is a comparison of wages paid in Yorkshire and Canada:
Yorkshire Canada
Binders	$ 5 92	$13 to $15	Twisters	6 34	13 to	15Spinners	5 77	13 to	15Reelers	6 52	17 to	20Doffers	5 22	13 to	15Overlookers	17 03	35 to	60W areliousemen	12 06	18 to	20Blenders. carbonizers	and labourers. . .	12 06	18 to	20Male help in grey-rooms, stockroom,	packing department. Firemen	12	30 13	89	19 to 30	22
I do not think that anyone will argue that wages in Canada are too high. Surely $13, $15 and $17 per week are not living wages. When our workers are forced into competition with labour at $5, $6 and $7 per week, how can they possibly maintain a decent standard of living and raise a family? It simply cannot be done. These facts which have been put before the government year after year, not only from this side of the house but by the Tariff Advisory Board, should have been given more consideration than apparently they have received. Thirty odd years ago there were in this country many cloth factories making just such fabrics as in the manufacture of which Canadian wool can be most advantageously used, fabrics of a kind specially favoured by farmers and others who desire first and foremost good wearing qualities in their apparel. But on account of insufficient tariff protection and in particular the inequitable manner in which the British preference has been found, by experience, to operate, large numbers of these mills have been forced to the wall. In spite of the unquestionable worth and durability of their products, they have been unable to hold their own in the domestic market, the market of the country to which they were indigenous; against the veritable flood of importations with which they have toad to contend. As a result, Canadian wool that a few years ago sold at from seventeen to twenty-five cents per pound is to-day being offered by the farmers in my constituency at eight cents per pound, with no buyers. It was the custom of many farmers in my constituency who raised sheep, to depend upon the wool clip to pay such items as taxes and insurance. I am told

The Budget-Mr. Edwards (Waterloo)
by reliable farmers that to-day they have two years' clip stored in their barns and they are unable to sell it. Their market was the mill to which I referred before and which had to close down its spinning plant. They are unable to sell their clip and as a consequence they have had to seek other means of raising this money.
I wish to give the statistics as received from the Department of Trade and Commerce with regard to the imports of raw wool from different sources, also the wool retained in Canada for the years 1927, 1928 and 1929. When we stop to contemplate the fact that at the time of confederation, sixty years ago, with a population of 3,000,000 we had a sheep census of nearly 3,500,000 and to-day, with a population of 10,000,000, we have less than 3,-X)0,000 sheep where we should have at least
20,000,000 to supply the local needs of Canada, some idea may be gained as to the condition of this industry. Everything is favourable for its enlargement with a country consuming more wool per capita than any other country in the world and with climatic and other conditions made to order. There is therefore only one conclusion to come to, and that is that we have with regard to sheep and wool products the most stupid policy that could be devised by any modern civilized nation.
The statistics which I wish to give are Canada's imports of raw wool from Australia as follows:
Australian imports
Calendar year	Pounds
1927		 510,461
1928		 215,832
1929		 416,728
From New Zealand the figures are as follows :
New Zealand imports Calendar year	Pounds
1927		 3,809,544
1928		 2,567,014
1929		 2,951,902
Figures which are more important are those showing the quantity of foreign wools retained in Canada. It must be noted that these figures do not necessarily mean that the wools have actually passed into consumption in Canada, but may represent large stocks of wool stored in Canada for eventual shipment to other countries including the United States of America. Surely it is a paradox when you think of us in this country importing huge quantities of wool from foreign countries and shipping our Canadian wool to the United States of America. Gilbert and Sullivan in their palmy days could never have written anything to fit this case. Foreign wools are 
to quite an extent stored in Canada in bond so as to be available f'or shipment to the United States as definite orders from that source are received by Canadian branches of foreign wool houses, of which there are now a large number located in Toronto and other Canadian centres. The statistics are as follows:
Foreign wools
_ ,	,	retained in Canada
Calendar year	Pounds
1927		   14,035,168
1928		 14,214,902
1929		 12,040,540
Canadian wools retained in Canada
Calendar year	Pounds
1927		 7,315,966
1928		 11,260,630
1929		 15,144,200
That is, two years after this nefarious budget was brought down in 1928, when the government took the 12J per cenlt off worsted yams, we find stored in Canada 15,144,200 pounds of Canadian wool. This does not indicate that the increased quantity of domestic wool has actually been consumed in Canada in the year 1929. Canadian dealers are holding vast quantities and the wool growers themselves in many cases have their wool for the past two seasons still unsold. This explains the vast stocks shown as retained in Canada in the past two years.
I hope I have put the case of the woollen and textile people before the house in an intelligent manner. I have tried to do so to the best of my ability. Every figure that I have given is taken from the official records and I can assure the house that unless some relief is afforded to the textile industry of this country in the very' near future, many more mills will go out of business. It is not fair to select any two or three or four industries and cripple them as the government is doing to-day. Huge sums of money are invested in these industries. I have photographs of the interior of one mill and it is fully equipped with the very finest machinery that can be purchased in the world. I can assure the house that these people to-day are driven nearly to distraction to find work lor their employees. At the same time we are bringing into this country tremendous quantities of cloth, finished goods, thus giving work to people in other countries and depriving our own people of it.
The Minister of Finance may talk about the British preference as he will. It is only a prate; it is only something thrown out to the people prior to an election. What difference does it make to a Canadian workman out of a job whether the business is built up

The Budget-Mr. Campbell
in the United States or in Great Britain? Not one particle, and I believe every workman in this country, in fact, every member of the house, would like to see our Canadian people employed. But the methods and the policy are wrong and will be until such time as the government are willing to adopt the entire policy of the party to which I have the honour to belong, as they have adopted that part which constitutes the only beneficial portion of the present budget.


Mr. M. N. CAMPBELL (Mackenzie):: I
wish to congratulate the Minister of Finance (Mr. Dunning) on this the occasion of his first budget. I recall the time twenty-one years ago when I had the honour of presiding as chairman at a meeting addressed by the present Minister of Finance and I remember that at that time he struck me forcibly as being no ordinary man. I expressed my opinion later to the audience that he was a man well worth -while keeping in one's eye and that he would make his mark. I am glad to see that he has fulfilled my prediction. At that time the minister did not have the air of self-confidence that he has to-day. He was then a very young farmer who was active in voicing the wrongs of his class and in putting forward suggestions for a remedy. Needless to say, sir, the remedies that he suggested at that time are not in the budget that is before us to-day.
There are many provisions in this budget that are satisfactory to me and will be satisfactory to my constituents. There are very many that are unsatisfactory. One of the unfortunate things about these budgets is that no matter whether a member votes for or against the budget he always finds himself voting against some things that he wants and for some things that he does not want. However, we must take the budget items in the aggregate and vote either for or against the budget.
In making a general analysis of the budget, I find that there are 270 items announced by the Minister of Finance as having the duty lowered. These are articles mostly imported from Great Britain. Of that number I find that 96 items apply exclusively to manufacturing. I am not complaining of the fact that reductions are made to manufacturers, but I draw attention to that fact because I am anticipating that statements will be made throughout the country boasting of the great benefit these reductions will be to the consumer, and I think it is well to point out this fact because with respect to these particular items there are no provisions for extending the benefit of the reduction to the consumer.
Of the other items there are at least 100 in respect to which there are no imports, and therefore for all practical purposes they can be wiped off the list of reductions. Among them are wheat, barley, buckwheat, tallow, hay and straw, live hogs, beeswax, eggs, oatmeal, cornmeal, potatoes, sugar beets, cider and sewing machines. These articles, previously dutiable, are now put on the free list when imported from Great Britain. But there are no importations of these goods and likely never will be, and the list of reductions is reduced accordingly.
A great many of the fruit items that are put on the free list when imported from the British Empire are fruits of a class that do not under any circumstances come in from Great Britain, the West Indies or any other part of the empire. Of the balance, I find that under ten items we imported less than $100 worth of goods under each; that under 15 other items we imported less than $1,000 under each; and that of 10 other items we imported less than $2,500 under each. I do not, of course, suggest that the importations will not be greater under the reduced rates. My point is that unless there is a certain amount of trade moving in a certain channel there is very little chance of a moderate reduction of "duty forcing that trade to move in that channel. The reductions are not made upon commodities of which we import large quantities.
With respect to other items, I find that certain changes are made in the application which may nullify the reductions. Take, for instance, item 409e-spraying and dusting machines, and so forth. There is a new phrase inserted in that item, "for farm purposes only." That phrase was not in the old item. The same phrase is included in item 409f- hay loaders, hay tedders, potato planters, potato diggers, and so forth. Both these items were previously dutiable under the British preference and are now put on the free list, but there is a possibility that with the addition of this phrase "for farm purposes only" they may be deprived of the benefit of being put on the free list.
May I refer to item 448 in the old tariff, under which a certain class of farm machinery had the duty raised from 10 to 30 per cent by the application of a provision of that kind? This item covers a certain class of farm implements for farm purposes. Some time ago the present Minister of National Revenue (Mr. Euler) instructed, I understand, the collectors that in order for these

Further on he said:
As a great exporting nation our course must be the contrary one of facilitating trade with those who facilitate trade with us.
It seems to me that if the minister had taken his own words seriously the first thing he would have done would be to do away with or modify this 50 per cent regulation. This regulation was introduced in the 1928 budget. The Minister of Finance at that time announced that the object was to foster inter-imperial trade. Well, I am objecting to this just as much on moral grounds as economic grounds. If there had been a reason for giving our manufacturers increased protection, then the government should have come out in the open and said so and not have resorted to this subterfuge. That is one of the objections I have. At the time it was pointed out to the then Minister of Finance by members from these benches that the effect would be to increase the tariff, not to reduce it. On one occasion the present Minister of Finance gave us an assurance- and he said he was speaking on the authority of the then Minister of Finance-that the regulation would not be allowed to have that effect. Later the Prime Minister definitely

The Budget

Mr. Campbell
export of Lancashire textiles is made unusually difficult by Canadian tariff barriers? We shall welcome shipload after shipload of Canadian wheat at Liverpool, or any other English port, so long as we know that those ships will load up with English products-coal, steel, machinery, textiles, hosiery, glass and china ware, and so on-for the return trip to Canada.
Mr. Thomas must take a firm stand here. He need have no fears on the matter, for the whole nation is solid on the subject. His job is to find work and wages for the people of Great Britain. They can only secure that work and those wages if there are markets for the goods they manufacture.
During the last two or three campaigns in the prairies, Mr. Speaker, one of the principle slogans of the Liberal party has been "Don't split the low tariff vote." We have heard that on the hustings all the way from the great lakes to the Rockies; indeed I believe the slogan was coined by the present Minister of Finance, and I give him credit for originating a good political slogan, because it did have a powerful effect. I think that slogan, and the way it was presented to the people in the province of Manitoba, succeeded in destroying the Progressive organization in that province, and it did us a great deal of harm in the province of Saskatchewan. The people were told that if they organized to elect a progressive they would be splitting the low tariff vote and would let in a Tory. Some of us tried to convince them that even if they did let in a Tory they would not be any worse off as far as the tariff was concerned, because the Liberals maintained a tariff just as high as the Conservative tariff, but with newspaper propaganda and a well-organized political machine behind them, they did make that slogan very effective. It seems to me, in view of the highly protectionist features of this budget and in view of the imposition and continued enforcement of this regulation, from now on we should hear no more of the slogan "Don't split the low tariff vote."


John Evans: 
Mr. EDOUARD LACROIX (Beauce) (Translation):: Mr. Speaker, my comments
will be brief. I shall confine my remarks to a few items of the budget which was brought down in the house on May 1.
First, I wish to thank the right hon. Prime Minister (Mr. Mackenzie King) for having fulfilled his promise to revise the tariff.
I also wish to heartily congratulate the hon. Minister of Finance (Mr. Dunning) for the splendid budget he brought down last week and which will remain a memorable event in the public records of this country. I want to state that I approve entirely of this budget.
All classes in this Dominion will benefit by this budget, however, since the riding I represent is made up almost entirely of farmers, I shall especially mention the excellent results which the farmers will derive from it, and the clauses intended to protect them.
The reduction in the sales tax of 50 per cent must first be mentioned. This affects both those who make large and small purchases. This tax increases greatly the cost of living. Let us hope that in a near future the government will find it possible to abolish it completely.
The customs duty on farming implements has been reduced; that on tea is now abolished. If we consider the large consumption of tea in Canada, we can realize how important it is for the consumer to have this article on the free list.
The abolition of these duties together with the decreasing of the sales tax will have the effect of lowering considerably the cost of living.
There is, sir, a certain clause in the budget upon which I wish to especially draw the attention of the house; the one which gives Canadian farmers protection by imposing a customs duty of 4 cents per pound on butter imported from British countries, notably from Australia and New Zealand, and 14 cents for butter imported from countries which have a prohibitive tariff against us, such as the United States. The tariff on potatoes is most important. According to the present budget, should the neighbouring republic impose a duty of 90 cents per bushel on Canadian potatoes we demand the same customs duty on American potatoes, this protects us entirely against file importation of this product at all seasons. The same principle also applies to live animals. This will greatly help the farmers and will prevent the importation of animals from countries having a prohibitive tariff against our exports. Fresh and pickled meats, eggs, wheat, wheat flour, oatmeal, are many products of the farm which will equally be protected in the future. iMr. Evans.]
The products of the maple tree, which are of the utmost importance in my district, deserve also consideration by the house. It is urgent to assist as much as possible the producer of this national industry. The maple sugar industry needs new markets since the neighbouring republic, by a prohibitive tariff, has suppressed almost entirely the importations of these products. I am glad to note that a measure has been introduced by the government with a view to protecting the products of the maple tree, the measure will come into force about July 1, next. One-seventh of the total production of the maple industry in Canada comes from the county of Beauce. In 1928, Beauce produced about $580,000 worth of maple sugar and syrup. If we take into consideration the fact that this crop is collected in less than a month, we can gauge its real value to the farmer, especially when we know that this crop is collected after the winter work is done, and previous to the spring sowing, at a time when the farmer is not very busy. From 1900 to 1924, this industry was not protected and was, so to speak, at the mercy of the speculator. There was, in certain years, a great demand for this product, other years the purchases were controlled almost entirely by one buyer and the whole crop was sold at ridiculous prices. The new measure, when in force, will provide for the grading of this product and thereby prevent its imitation.
What are we to think of the abuses which have contributed to destroy almost entirely the value of this industry? What are we to think of this merchant or manufacturer who, in the capital of the province where we are at present living, bought each year four or five cars of this product in order to later on sell 25 or 30 cars of the same product adulterated.
The maple sugar producers of my district and those of the province of Quebec have formed a cooperative society, built sugar-houses and installed modern machinery, and their products are at present of a much superior quality. It is therefore absolutely necessary that this new measure be put into force without delay in order that the producer may be amply protected.
We also have, sir, in the county of Beauce another industry that needs assistance, its market is limited. I mean the industry of pulpwood as carried on by the farmer who finds it necessary to do a little lumbering of his own yearly and sell where he can find a profitable market. I see on the orders of the day a resolution, its purport is to help the paper industry in the province of Quebec and it states: that the time has come to prohibit

Calgary and Femie Railway
the exportation of pulpwood to the United States. I wish to emphatically state that I am entirely opposed to this resolution. Allow me to review the present situation and draw my own conclusions. Why are our farmers forced to export their pulpwood to the United States, when there are so many paper mills in the province of Quebec and throughout Canada? It is because Canadian companies are not desirous of purchasing pulpwood from the farmer. For the last 20 years, I have seen with my own eyes farmers obliged to pass, while drawing their wood to the railway station, through the yards of one of our principal paper mills. For twenty years, the farmers have been drawing their wood in winter and passing through the yards of this mill to reach the railway station in order to find a purchaser for their pulpwood. This state of things should not exist in Canada. The owners of paper mills should be sufficiently interested in the farmer's product to purchase at least what passes through their own yards. These same farmers must moreover pay the freight rate of $8 per cord to ship their wood to the United States. The Canadian mills could have purchased their pulpwood for a number of years past, at the rate of $10 per cord delivered. However, instead of purchasing it, they allow it to reach the American mill owners who pay $18 per cord delivered. This state of things could not exist if our Canadian mill owners had at least their future interest as well as that of Canada.
Could not the various provinces of Canada oblige our Canadian mills to take but 80 per cent of their yearly cut on the limits conceded under government licence and oblige them to purchase the other 20 per cent from the farmers, thus enabling them to sell their pulpwood on the Canadian market. Such a regulation would make it possible to absorb our own raw material and further utilize it in this country to the benefit of the whole population. If the Canadian mills were only allowed to take but 80 per cent of their yearly cut on limits under licence, they would be forced to purchase the entire cut of the farmers.
Statistics tell us that Canadian farmers cut about 1,500,000 cords of pulpwood yearly, and furthermore that the Canadian mills absorb over 7,500,000 cords yearly. We therefore know that 20 per cent out of a total of 10 to 12 million cords would more than suffice to absorb the entire output of our farmers. It would therefore be an easy matter for our Canadian mills to create a market for the farmers' needs. Thus would we prevent competition by our neighbours in the paper industry and also retain our raw material, without any disadvantage to our farmers, for should the Canadian mills find it impossible to absorb the farmers' entire output, there would still remain for the latter the foreign markets.
Briefly, I think it urgent to put into force as soon as possible the act relating to the maple sugar industry and I state that I am opposed to any resolution aiming at restricting the farmers from selling their pulpwood wherever they please.
On motion of Mr. Prevost the debate was adj owned.
On motion of Mr. Lapointe the house adjourned at 10.47 p.m.
Friday, May 9, 1930.