1931-06-17

BANKING AND COMMERCE

[Stage Direction]
Fourth report of the select standing committee on banking and commerce.-Mr. Matthews.
Mr. MATTHEWS moved that the report be concurred in.
Motion agreed to.

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

Mr. TETRAULT:: 1.	What number of industries were established in the province of Quebec since August 1, 1930?	6
2.	What are the names of said industries?
3.	Where were they established?
i.	What goods are manufactured by them?
5.	How many people do these new industries employ ?
6.	What is the average salary paid in said industries?


Mr. STEVENS:: 1,	2, 3, and 4. Information not available except for branches and subsidiaries of firms in outside countries. For information available see Hansard June 1, 1931, page 2333.
5 and 6. Information not available.


YUKON AIRWAYS
Mr. MACKENZIE (Vancouver Centre):: 1.	Were there admitted to the Yukon Territory from any portion of the United States an aeroplane or aeroplanes for the use of the Yukon Airways, since August 1, 1930?
2.	If so, what was the assemblage duty on such plane or planes?
3.	Was such duty paid to the Canadian government?


Mr. RYCKMAN:: 1.	Yes. Plane entered at Vancouver.
2.	It is contrary to usage to give such information as it would disclose the business of an individual concern.
3.	Yes.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. RALSTON:: 1.	What are the names of all census enumerators for the province of Nova Scotia (giving counties separately) ?
2.	Which of these appointees are ex-service
men ?	x

Motions jor Papers


CENSUS ENUMERATORS-WEST LAMBTON
Mr. GRAY:: 1.	What are the names of the census enumerators appointed in the constituency of Lambton West?
2.	Who appointed the census enumerators for the constituency of Lambton West?
3.	Upon whose recommendation were they so appointed ?
4.	How many of the appointees are returned soldiers, and: fa) what are their names; (b) how many were out of work at the time of such appointment?
5.	How many of the men appointees were civilians out of work at the time of their appointment? *
6.	How many are married men with dependents and in need of said work?
7.	How many among the women appointed
are widows with dependents, and:	(a) what
are their names; (b) what is the relationship between those dependents and the appointee in each case?
8.	How many are married women whose husbands are living and out of work?


Henry Herbert Stevens: In connection with this
and the previous questions, I will get the returns as quickly as I can.


NIPISSING CENSUS COMMISSIONER
Mr. HURTUBISE:: 1.	Who is the census commissioner for the electoral district of Nipissing?
2.	On whose recommendation was he appointed?
3.	What salary does he receive?
4.	What are the names of the census enumerators appointed for the electoral district of Nipissing?
5.	What is the occupation of each?
6.	How many war veterans were appointed and what are their names?


Henry Herbert Stevens: Order for returns, now
tabled.



MOTIONS FOR PAPERS


Mr. BENNETT:: I think these motions
standing in the name of the hon. member for Charlevoix-Saguenay (Mr. Casgrain) should be disposed of to-day. I have allowed them to stand twice. The list covers motions from 1 to 32 inclusive. It was understood the other day that they might be dropped with a view to having further inquiries made. Is the hon. gentleman not here to-day?


Mr. MACKENZIE KING:: He is somewhere about; I regret he is not in his place.


Richard Bedford Bennett: Let them stand.


Mr. SPEAKER:: Motions 1 to 32 inclusive stand. ,



MONTREAL CUSTOMS AND EXCISE INSPECTOR

Mr. DENIS:: For a copy of all documents in the possession of the Department of National Revenue in connection with the inquiry held by Mr. Lafontaine into the administration of customs and excise district inspector, Mr. J. A. Bernier, at Montreal, during the last three years.


Mr. RYCKMAN:: Stands.


Some hon. MEMBERS:: Why?


Edmond Baird Ryckman: At the request, I understand, or at least with the consent of the hon. member in whose name the motion stands.
Motion stands.



UNOPPOSED MOTIONS FOR PAPERS


Mr. GOULET:: For a copy of all documents, correspondence, memoranda, letters, exchanged between the Minister of Labour at Ottawa, and the Minister of Labour at Quebec, and the municipal council of La Sarre, county of Abitibi, Quebec, or the mayor or any of the officers of the said council, in connection with expenditure under the Unemployment Relief Act in La Sarre.



QUEBEC HARBOUR COMMISSION

Mr. POWER:: For a return showing the names of all employees on the payroll of the Quebec Harbour Commission during the month of June, 1930, and during the month of November, 1930, and the salary paid to each on a weekly, monthly or yearly basis.


Richard Bedford Bennett: The hon. member knows the limitations imposed in the passing of an order such as this.


Charles Gavan Power: I quite understand.


[Stage Direction]
Motion agreed to.

Mr. VENIOT:: For a copy of all paysheets in connection with wrork done on Public Landing wharf, under the foremanship of Titus T. Parker, in the electoral district of Royal, New Brunswick.



TELEPHONE LINES AT MAGDALEN ISLANDS

Mr. BRASSET:: For a copy of all correspondence, telegrams, documents, affidavits, instructions, etc., exchanged between the general superintendent of the telephone lines at Magdalen islands and the local superintendent, or any other person, in connection with the dismissal of Stolin Cormier, of LaVerniere, Magdalen islands, repairer of the telephone line.

The Budget-Mr. M anion



THE BUDGET


[Stage Direction]
The house resumed from Tuesday, June 16, consideration of the motion of the Right Hon. R. B. Bennett (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, the amendment thereto of Mr. Ralston, and the amendment to the amendment of Mr. Spencer.
Hon. R. J. MANION (Minister of Railways and Canals):: Mr. Speaker, at the beginning of my remarks, I should like to pay one compliment to my right hon. friend (Mr. Mackenzie King); I should like to compliment him upon the physical feat which he performed yesterday in talking for four hours to this house. I will not discuss the mental aspect of it, except as I go along, but I gladly offer him a compliment on the physical feat he performed. And since I have only forty minutes at my disposal I am sure he will forgive me if I pay him no other compliment during my remarks.
We all greatly enjoyed the speech of the right hon. gentleman, particularly the last part of it, the last half hour or so, when, during that peroration he worked himself up into a frenzy of righteous indignation because of alleged neglect of the unemployed by the present government. It reminded those of us who are old-timers in the house, those who have been here for quite a number of years, of the days in 1920 when the right hon. gentleman was making the same kind of speeches. Yesterday he even discussed orders in council and the cost of living, and I thought, by an accident perhaps, Senate reform might drop from his lips; I have no doubt that long before the next election he will be a Senate reformer once again as he was before the days of 1920. In other words, Mr. Speaker, he adopted the role of the demagogue which he assumed in the old days of opposition, when he was a defender of the downtrodden and the oppressed of all classes. In opposition my right hon. friend is the most politically virtuous politician in this country. He fairly tore the purple out of the skies when he was condemning the terrible sins of this government, and comparing the multi-millionaires and millionaires of this government with the labouring people.
My right hon. friend has an unfortunate memory; he forgets the early years of his own association with millionaires, when he
was pleasantly-and I may say without offence, profitably-associated with one of the greatest exploiting millionaires this continent has ever produced, a man whose unsavoury reputation in his dealings with labour still sticks to the association which my right hon. friend had with him, and which I fear will stick for a long time.
I was rather glad to see my right hon. friend take the attitude of not accepting the subamendment of the party in the far comer, because during the debate on the address he did accept the subamendment brought forward by that party in a rather humiliating manner, I thought, from the standpoint of his party. He swallowed it; he swallowed his own amendment, hook, line and sinker, but the story goes that some of his own party walked out on him and refused to follow his lead in that vote, so at this time he could not do the same thing.
Then my right hon. friend spent a good deal , of time in dealing with advertising. He seems to forget that the late Jim Robb, who was Minister of Trade and Commerce for some years, and Jim Malcolm, who was also Minister of Trade and Commerce for some years, used to put out the same kind of advertising in the press of this country in the name of the Department of Trade and Commerce, and I heard many protests raised against that practice on the floor of this house. My right lion, friend particularly worked himself up because of that phrase "Canada first." That still sticks in his crop, if I may use that expression. I suppose he prefers the old cry of "Washington first" rather than "Canada first." Well, I will admit quite frankly that probably this government have made some mistakes; no doubt they will commit others, but at the same time they remain a Canada first government and are proud of it.
Referring also to advertising, I felt that the right hon. gentleman was perhaps unfortunate in his references, because recently there has been an airing in the courts of some advertising which his own government took on in London. Apparently his government, according to the press, were not only satisfied to pay the advertising bills, but also a nice fat fee of $5,000 which was to go to one of their political supporters.
Then, Mr. Speaker, he dealt with taxes, and he put up that old argument that taxes were lowered by the late government. How you can lower taxes and at the same time take more taxes from the people always has been a puzzle to this side of the house. I make the statement without fear of contradiction, Mr. Speaker, that the government

The Budget-Mr. Manion
of the right hon. gentleman took more money in taxes from the people of this country, during his years of premiership, than any other government ever took in a similar number of years in Canadian history.
The right hon. gentleman also spoke of the Welland canal, and he made a statement which he should have hesitated to make, because he has made it several times previously and I have tried to correct him. I will say again that the hon. gentleman was mistaken. We did not extend the contracts more than they are extended in the ordinary course of events. We carried on with the same contractors to whom my right hon. friend's government gave the contracts; we carried on at the same prices. These contractors, according to the Department of Justice, had a right to go on with their work, whether we liked it or not, and we had to pay the bill. That is the truth of the Welland canal matter, so I hope we will not hear statements of that kind again.
Then my right hon. friend worked himself up into that astonishing peroration on unemployment. He spoke of prosperity again. Well, Mr. Speaker, I was not far behind him out on his trip through the prairie provinces and British Columbia, and he started out with that talk of prosperity during the campaign. Some of his friends, however, told me they were afraid he would be mobbed before he finished, because there were so many unemployed at that time. The unemployment situation in Canada then was just as severe as it is now, if not more so.


Some hon. MEMBERS:: Oh, oh.


Robert James Manion: Yes, I say it was at least as severe as and probably more severe than is the case at the present time, but then the right hon. gentleman and his ministers were talking about prosperity in this country. Why, the right hon. gentleman stood on the floor of this house and made the statement that there was no unemployment in this country. He made the further statement that he would not give a five cent piece for the relief of unemployment to any province of this country under a Conservative regime, and at that time there were six provinces with Conservative governments. Then he turned, as though he had discovered the villain in the piece, and said, "the Prime Minister laughs." No wonder the Prime Minister laughed; who would not laugh at such an attitude as that taken by the right hon. gentleman? Not only did the Prime Minister laugh; we all laughed when we thought of the attitude of the right hon. gentleman in connection with

unemployment when he had the power to help conditions, as contrasted with the attitude he takes now when he has no power to help.
Then my right hon. friend went on to deal with the railway situation in Canada, and I wish to spend most of my time on that subject because I am somewhat familiar with it. I believe the last person in this country to take a critical attitude towards a Conservative government in regard to railways is the leader of the Liberal party, because from 1900 to 1904, and perhaps again in 1911, there was an opportunity to put this country for all time in an easy position as far as railways were concerned. Yet my right hon friend's predecessor, as leader of the Liberal party at that time, not only permitted one transcontinental railway to be built, but permitted and almost insisted, or at least arranged, that two transcontinental railways should be built, in addition to the Canadian Pacific railway. He it was who went into the Grand Trunk Pacific scheme, with the old Grand Trunk, and arranged to construct the National Transcontinental in association with it, and it was he who, before going out of power in 1911, guaranteed to Mackenzie and Mann another $35,000,000 to extend their line from the great lakes east to Atlantic tidewater. Thus three transcontinental railways, were projected and built, and because of those two extra railways we have had the terribly oppressive condition in regard to railways that this country has been experiencing: We overbuilt in railways, as everyone knows. Had the right hon. leader of the Liberal party of that day had the vision to insist that the Grand Trunk in the east be linked up with the Canadian Northern in the west, we would have had but two transcontinental systems and we would have had no railway problem in this country at all. It was the duplication involved in the second and third transcontinental lines that put this country in- its present position. To-day we find that Great Britain, for example, has eight times as many people per mile of railway as we have in Canada; Germany has seven times as many; France five times as many and the United States over twice as many, and that condition is entirely due to the Liberal government of a quarter of a century ago. The result was that in 1918 and 1919-and of course the war complicated matters-'both these railway projects were left on the doorstep of the government. I will proceed to show that it is largely due to the late government that the difficulties of the national railways are very severe.
To-day, sir, we have the unpopular role of questioning the accounts and expenditures of

The Budget-Mr. Manion
the Canadian National Railways and telling the public the facts in that connection. I shall endeavour to show why that questioning is necessary. Between 1926 and 1928 there were boom conditions throughout the world; there were bounding revenues on the Canadian National. In 1928 the Canadian National Railways had a net operating revenue above all expenditures of $54,000,000, which was more than the interest owing to the public during that year; but in the following year, 1929, the net operating revenue had dropped by $13,000,000 to $41,000,000, which was $9,000,000 below the interest owing to the public during that year. Yet in 1929, the second last year of the late government and a preelection year, that government permitted and I expect encouraged commitments amounting to $270,000,000, and I am going to give the details, which are as follows:
Temporary financing carry-over
from 1928	$ 40,000,000
Ordinary budget requirements	53,000,000
Maritime freight rates and
eastern lines deficit	 9,000,000
Statutory authorizations outstanding	  22,000,000
1929-three-year branch line
program	 30,000,000
Montreal terminal scheme.. .	50,000,000
Acquisition of railways. .	. .	30,000,000
Equipment issues	 18,000,000
Refunding requirements.. ..	18,000,000
Total	$270,000,000
In that year, 1929, there was added to the funded debt of the national railways $145,000,000. In addition there was carried over into 1930 unfunded debt amounting to $32,000,000. If you consider that an amount of $145,000,000 means an annual interest charge against the national railways of $7,000,000, you realize the responsibility which the then government assumed. That amount of $145,000,000 was within ten million dollars of the amount of the total increase of funded debt in the six previous years.
On August 1, 1930, when we came into power, there were commitments amounting to $158,000,000 over which we had no control, and some of which still exist. Yet in 1930, that very year, the gross operating revenue of the Canadian National Railways was down by $3,000,000 as compared with 1923, and the interest to the public was up by $18,000,000 or $19,000,000 also as compared with 1923. Moreover, in 1927 they had made a three year branch line program and it was unfinished, but in 1929, the preelection year, they brought in a 1929-32 program which amounted to S30,000,000 on top of the other unfinished program of the previous three years.
It might be asked: What part of that program was unnecessary? What was done that the then government urged the national railways to do? I am quite certain that I am within my rights in stating that much of the expenditure was pushed on by the government of that day. There were such things as the $2,000,000 Halifax hotel which was just about as much needed as a fifth wheel on a coach; a $4,000,000 hotel in Saskatoon where I am informed by the best authorities that a million dollar hotel would have difficulty in paying; a $9,000,000 hotel in Vancouver. The much maligned "shadow" government of 1926 passed an order in council for the building of the hotel at Vancouver, but it was for a $3,500,000 hotel to satisfy that city in regard to arrangements made by Mackenzie and Mann. That, however, was increased in 1929 to $9,000,000. Then there were the steamers on the Pacific coast. They even had in their estimate a hotel at Prince Rupert amounting to $600,000. These were all brought in by the Canadian National in association with the government of that day in a preelection year.
May I say that if we had a few more years with expenditures like those of 1929, there would be no Canadian National Railways to tell a tale. I am not blaming Sir Henry Thornton and his officials. They were enthusiastic, perhaps over-enthusiastic, as all engineering officials are, in dealing with a big organization. They like to build an organization of that kind into a magnificent institution, and that was the object of Sir Henry Thornton. But the government of that day was the trustee not only of the people of Canada but of the Canadian National Railways, and after a year's survey I can find no evidence that at any time the late government showed any signs of realizing its responsibility as a trustee of the people of Canada and the Canadian National Railways. I wish to add that Sir Henry Thornton and his officials deserve a great deal of credit for the excellent work done by them in consolidating diverse and competing railways, in bringing about a fine esprit de corps amongst the officers and men and in bending their best efforts to build up a great transportation system to compete with the Canadian Pacific. But I do not give any credit to the late government for the fact that they pressed forward scores of millions of dollars of expenditure by the Canadian National Railways that the railways would have been better without.
In regard to the Canadian National Railways so many figures have been put on
The Budget-Mr. Manion

Hansard by various speakers that I am going to give a brief resume of the position, as was done by my right hon. leader (Mr. Bennett) in a straightforward discussion when he presented the budget. I shall show in brief the position and the responsibility that we have in that regard. There are only two items that are important in the balance sheet:
Funded debt unmatured.. $1,168,000,000 Dominion of Canada account 1,330,000,000
Total	$2,498,000,000
Or, in round figures, $2,500,000,000. The amount of $1,168,000,000 is money owing to the public lenders of funds; that is the bonds and debenture stocks that were issued. These consist of securities guaranteed by the government to the extent of some $926,000,000 and unguaranteed securities to the extent of $242,000,000. The interest on the debt to the public amounted in 1930 to $53,000,000, or more than $1,000,000 a week. It was that interest to the public that the Canadian National Railways were short of paying last year by $29,000,000, but they were also short the $32,000,000 of interest owing on government loans. In fact, that has never been and probably never will be paid. The whole national income of Canada in 1900 was only $50,000,000, and when you consider that the interest owing to the public alone by the national railways is now more than $50,000,000, a year you realize the magnitude of that figure.
Let me give a few other figures in explanation of the item of $1,330,000,000.-Dominion of Canada account. This comprises loans amounting to $60-1,000,000, two-thirds of which was spent upon capital and the balance on deficits. But the hon. member for North Waterloo (Mr. Euler), speaking the other day, suggested that that $604,000,000 should be wiped out altogether. I do not know why two-thirds of that amount should be wiped out seeing that it has gone into the property.
Then there is interest amounting to $322,000,000 that has accrued on that amount of $604,000,000 during the years, but unfortunately, not one cent of it has been paid, and I do not think we can hope for repayment in the future. The third item is the appropriations amounting to $403,000,000 covering the cost of the Intercolonial, the Prince Edward Island Railway and the National Transcontinental. Those three items amount to $1,330,000,000, which is the actual cost in money or in loss to the public of the Canadian National Railways. There are some who say that that interest on that $604,000,000 should be wiped
[Mr. Manion.l
out, but is it not a fact that if that money had not been spent on the Canadian National, before and since amalgamation, that money would have been available to lessen the debt of the country? Therefore it has been a straight loss.
But that is not all of the responsibility of Canada. In addition to the $1,330,000,000 made up of loans, $604,000,000, interest, $332,000,000 and appropriations of $403,000,000, there are guarantees amounting to $926,000,000. If you add those together, you get a Canadian government responsibility of $2,256,000,000, and according to the public accounts, the whole war and demobilization cost was $1,695,000,000, or about $500,000,000 or $600,000,000 less than the cost of the national railways to Canada so far including the guarantees. Those are stupendous amounts. I think the Toronto Telegram was right in saying that is Canada's second national debt. What makes it the more serious is the fact that during the present year, 1931, the income of the Canadian National Railway is decreasing. There was published in the press only this morning the decrease for the last week for which the accounting is completed, and compared with the corresponding week last year the decrease in income is over one million dollars. In other w'ords, the revenues of the railways are going down, and the deficit on interest to the public, instead of being $29,000,000 this year, must, unless something miraculous happens, be more than that amount.
Therefore I have laid before the house the official figures because I want this house and the country to realize the great responsibility of the country towards the Canadian National Railway, and the great investment which the country has in that railway. I submit that in view of the magnitude of that investment it is our duty as a government to examine the figures of expenditure and revenue of the Canadian National Railway. It is our duty not only as a government but as loyal Canadians, and as friends of the Canadian National Railway itself, to do that. Our desire is that not only the Canadian National Railway but the Canadian Pacific Railway as well shall be successful. We want them to work together in healthy competition and reasonable cooperation, giving economic management and fair rates to the people of this country. I submit again that the clear-cut statement of facts given by my right hon. leader in his budget statement was a straightforward and necessary statement which the people must have in order to realize the position of the Canadian National Railway as it affects the people of this country, and I say that the statement that is being foolishly

The Budget-Mr. Manion
made by some of the press of my right hon. friend, the leader of the opposition, that we are enemies of the Canadian National Railway, is simply an untruth. Any man who is an enemy of the Canadian National Railways is not a good Canadian, and therefore as I consider this a good Canadian government, and that we are at least good Canadians, we are not the enemies of the Canadian National Railway, but its friends, desirous of looking after its best interests.
The principle of public ownership is not at stake, because we are into public ownership to the extent I have shown by over $2,000,000,000, and we are being asked this very year to guarantee securities of the railway to the amount of over $104,000,000, for public ownership. I say without fear of contradiction by people who think properly that when the national railways have attained to the position where they neither require guarantees nor cash assistance from the people of Canada in vast amounts, then and not till then should their accounts be free from examination by the members of this house. I say further that I have talked this matter over several times with Sir Henry Thornton, and he agrees with every word that I have said so far as the necessity for an examination of the accounts and the need for economy goes. Only yesterday in the railways and shipping committee Sir Henry Thornton explained during a period of one hour and a half the efforts they are making to bring about economies that are absolutely necessary at the present time, and I invite my hon. friend from North Waterloo, who is not in his seat at the moment, but who connected my right hon. leader with another speaker on this side of the house who is not in the government, and who he said made an attack on the Canadian National Railway, to ask Sir Henry Thornton at the meeting of that committee tomorrow-and I will invite Sir Henry Thornton to answer frankly-if he is not perfectly satisfied with the attitude of this government towards the Canadian National Railway in every possible way.


Some hon. MEMBERS:: Oh, oh.


Robert James Manion: Well, I do not think Sir
Henry Thornton has ever been afraid to express himself frankly. He gets very good support throughout the country and I do not think he would hesitate to -express himself quite frankly. If he did, it is certainly not my fault. Proof that the management themselves realize the need for economy is found in the fact that they have within the last
few days organized a finance committee, made up of the president, the deputy minister, Mr. Smart, who represents the government in my absence, and Mr. Gerard Ruel, one of the vice-presidents, the duty of which committee will be to investigate every expenditure of the railway. Further proof is found in the fact that the Canadian National and the Canadian Pacific, at the request of my right hon. leader, have for some months been endeavouring to cut out unnecessary duplications and unnecessary competition, and they have done so to the extent that they have made a saving, they claim, of something like one million dollars a year each by cutting out unnecessary duplication and unnecessary services.
I admit that our lot is not a very pleasant one in regard to checking up the expenditures, but it is a very necessary one. I submit that the motto of the Canadian National Railway should be: Care, caution and proper economy. When you realize that from 1923 to 1930 the cash and guarantees to the Canadian National Railway amounted to something over $490,000,000, and when you realize that the actual net debt of Canada on March 31, 1914, amounted to $336,000,000, or, in other words, the cash and guarantees to the railway have been 50 per cent greater than our whole national debt before the war, you will realize why these investigations are advisable.
It might be asked, how a government can interfere with a railway in any way without interfering with maintenance and efficiency? I say that it can interfere as the government of my right hon. friend had the opportunity to interfere in regard to some of the capital expenditures I have mentioned earlier in my remarks. I read recently in one of the outstanding papers of Canada, the statement that these expensive hotels were necessary because they added indirectly to the passenger train revenues. I wondered if that was correct, and so I had an investigation made by the officers, and the report of the officers to me was that the passenger revenue loss in 1926 was $4,000,000, and the passenger loss in 1930 was $20,000,000. These great expenditures on passenger service, therefore, are not giving the return they should give.
There is another question on which I wish to touch in regard to the Canadian National, and that is the question of refinancing. I see many statements by editorial writers, and receive many letters, to the effect that there should be a refinancing of the Canadian National. I read in one of the Toronto papers only last evening that if a proper refinancing
The Budget-Mr. Manion

was made of the Canadian National Railway, the road would be able to pay its way. Now the only way you could put the road in a position to pay its own way would be to wipe off the $1,330,000,000 which it owes to the government and a part of the $1,168,000,000 which it owes to the public. The only scheme of refinancing which was put up by the Canadian National itself was put up to Mr. Dunning when he was Minister of Railways in 1928. The scheme then was to write off some $800,000,000 of the capital structure, which was made up of capital stocks adjudged valueless, deficits, and interest, amounting to a little over $800,000,000. Adding those stocks to which I have not paid any attention in the figures which I have given, but which form a considerable part of the capital liabilities to the $1,330,000,000, you have government account of $1,600,000,000. If you wipe out $800,000,000 from $1,600,000,000, you still have left $800,000,000 on which interest would accrue, and as not a cent of interest has ever been paid to the government I say that the refinancing could not possibly be of any use at this time, because the $29,000,000 that was short last year was not on government account, but on the $1,168,000,000 owing to the investing public. Therefore, any refinancing scheme that has thus far been proposed could not possibly put the Canadian National Railway in a position to carry itself. I have discussed this question many times with Sir Henry Thornton, and I have in my desk a letter from him stating that he does not consider that at the present time it would be of any use to propose any refinancing scheme to the government and to parliament.
There is one other matter that I wish to mention, and that is the public demands not only upon the Canadian National but upon the Canadian Pacific as well. We get demands from all over Canada for rate reductions and capital investments. I have requests before me to-day for capital investments in stations, hotels, branch lines, bridges, and so forth, for the Canadian National Railway, amounting to $200,000,000. The people of Canada cannot have it both ways. They cannot have rate reductions on all possible occasions, and capital expansion in every direction, and at the same time have the Canadian National Railway and the Canadian Pacific Railway remain in a sound economic position. In addition to the demands for rate reductions, the railways during the last few years have had to meet severe motor bus and motor truck competition, which has been without regulation. It is not fair, I say here to-day, to either of these two great transcontinental

systems, with their expensive roadbed, their high priced equipment and heavy taxes, that they should have to meet the competition of motor bus and motor truck lines running on public highways that have been built partly out of the tax-es on the railways themselves. These bus and truck lines come under no regulation, and I believe that in this country as in other parts of the world we shall be compelled to put into effect some method of control.
I might be asked, what is the outlook for the Canadian National Railway. After a fairly thorough study of the question I would say this:	My feeling is that there is no occasion for panic if wise and prudent direction and control are exercised. Provided that certain conditions obtain which I shall hereinafter mention, I think that within five years we will have a much more cheerful story to tell for the Canadian National Railways than we have to-day. The world is going forward, and I consider the present depression will pass as other depressions have passed, although my right hon. friend the leader of the opposition last night looked at the depression through very blue goggles. Since he has become leader of the opposition he is very much more pessimistic than when he was in power. Of course I will agree that that is an effect of being in opposition. I have no doubt my right hon. friend opposite feels there is a gentleman who can handle the affairs of this country very much more satisfactorily than can my right hon. leader, although probably the right hon. gentleman opposite is much too modest to mention the name of that gentleman.
The following are the conditions:	If the
depression passes, if unwise capital expenditures are not indulged in, if costly advertising stunts are eliminated, if proper economic management is brought into play and if the people of this country are reasonable in their demands as to freight rates and capital expenditures, I think within five years from now there will be a very much more hopeful and cheerful picture in connection with both the great railways of Canada than there is at the present time.
May I say in closing that the real friends of the national railways are those who believe in care, caution and economy in the policies of the road. The real enemies of the road are those who, consciously or unconsciously, advocate extravagant or unnecessary expenditures in connection with the operation of the road. The course of this government and of hon. members on this side of the house, is the only loyal course the people of

The Budget-Mr. Mackenzie (Vancouver)
Canada can adopt, so far as the Canadian National Railways are concerned, not only towards the road but towards the people of Canada themselves.
Sir, I have spoken much more hurriedly than I otherwise would have done because I had a great deal of ground to cover. I have however placed a great many facts before the house, and I submit again that my right hon. friend should be the last man to say that the present government is not acting fairly towards the railway company. I would ask my right hon. friend opposite to remember that it was his government that permitted, if it did not actually encourage, those immense capital expenditures the interest upon which is to-day a very heavy load upon the national railways.


Hon. IAN MACKENZIE (Vancouver Centre):: Mr. Speaker, my first observation would be one of congratulation to the administration upon their rapid exit from this chamber. My second observation would be one of congratulation to the right hon. Minister of Finance (Mr. Bennett) upon the laborious and comprehensive character of the financial presentation he made to this house and country. Although the hon. member for Shelburne-Yarmouth (Mr. Ralston) is absent I should like to congratulate him upon one of the most splendid cool-headed, knowledgeable, rigid and relentless analyses of the Canadian financial situation ever presented to the Canadian parliament. Concerning the brilliant address delivered yesterday afternoon by my right hon. leader (Mr. Mackenzie King) I can say only this, that during his very brilliant career in my opinion his speech of yesterday was the crowning effort of his parliamentary life.
An hon. MEMBER, Oh, oh.


Ian Alistair Mackenzie: I hope, Mr. Speaker, you will be kind enough to allow for the time taken in the interruptions of my hon. friend from New Brunswick.
May I say to my hon. friend the Minister of Railways and Canals (Mr. Manion) who has just resumed his seat that if he had omitted the first portion of his remarks and as a minister of the crown had placed before the Canadian people only that very comprehensive analysis of the Canadian National Railways situation he would have added to his own reputation, instead of endangering and hurting it this afternoon. I desire to say to my hon. friend that it ill behooves and ill becomes him to cast aspersions upon a wonderful humanitarian organization such as the Rockefeller foundation, when in fact his own
leader in parliament (Mr. Bennett) was until 1927 a director of the Imperial Oil Company, a subsidiary of the Standard Oil Company of America. As has been proven by hon. members on this side of the house during the present session, the result of the tariff legislation of last September has permitted that same subsidiary of the Standard Oil Company of America to tax the Canadian people to the extent of '$24,000,000. Therefore I say to my hon. friend that he had better keep quiet about associations with millionaires.


Some hon. MEMBERS:: Oh, oh.


Ian Alistair Mackenzie: May I, quietly and humbly, present to this house a quotation from Hansard of May 13, 1930:
There is in medicine an unscientific type of practitioner who when he does not know how to diagnose a case takes ten or a dozen drugs, jumbles them together in a prescription and offers it to the patient, hoping that if one therapeutic bullet does not hit the disease, another may. That is what is sarcastically called a "gun-shot" prescription. This budget is a "gun-shot" budget, the government hoping that if one political bullet does not bring down what I may call the prey, another bullet may do so.
The author of that wonderful paragraph was the hon. Minister of Railways and Canals (Mr. Manion). And to show the delightful consistency of the minister may I quote from his address as delivered in the city of Vancouver during the last election campaign. He said this:
One of the policies of our party is that we don't want any more immigrants till we can look after our own people.
Hear, hear! Now, let us read what the hon. member said in this parliament, as it is reported in Hansard of May 22, 1929, at page 2746, when the hon. member supported that dramatic and exorbitant scheme of his confrere, General McRae, the chief opposition whip:
We have one of the greatest countries in the world and if it were properly handled it should be the mecca for all the desirable peoples in all the overcrowded portions of the earth.
Yes, China, Japan and even Russia! My hon. friend was then inviting them all. Further he stated:
My complaint is not so much that the number of British immigrants is not larger, as that our immigration of all classes is much too small. The question is often asked how many can we absorb in this country?
And once again:
I submit that we can take many more immigrants of all kinds.
And again:
I submit that we have a need for people of all classes.
2720	COMMONS
The Budget-Mr. Mackenzie (Vancouver)
And again:
If our country is as prosperous as the right hon. the Prime Minister and some of his followers claim it is, we should he able to absorb hundreds of thousands of all classes of immigrants from all countries.
Exhibit 3, Mr. Speaker-Manion on the sales tax. To-day my hon. friend, the Minister of Railways and Canals, is favourable to an increase in sales tax from one to 4 per cent. What did he say on May 8, 1929, while on this side of the house, and speaking for the official opposition:
We think the sales tax should be wiped out altogether.
Exhibit 4, Mr. Speaker-Manion on trade, during the regime of the wicked Liberal administration. We find on March 8, 1929, at page 791 of Hansard, the following statements of the present Minister of Railways and Canals in his address on the budget:
For example, the Argentine buys from us nearly twice as much as we buy from them; Belgium two and a half times as much; Brazil over three times as much; Chile nearly seven times as much; China over six times as much; Denmark twenty-five times as much; Germany two and a half times as much; Japan three and a half times as much; the Netherlands over five times as much; Portugal eight times as much. But the United States buys from us only one-half of the amount she sells to us.
What a wonderful tribute by the hon. Minister of Railways to the trade policies of the Liberal party in 1929! Now let me give the last of these exhibits in regard to the delightful consistency of my hon. and consistent friend. Speaking in this house on April 2, 1930, he is reported in Hansard at page 1201 as follows:
I submit to the Prime Minister that the people of this country are anxious for frank and candid statements from the government at the present time on all matters of public policy.
The hon. gentleman was speaking in regard to unemployment. All this session we have been pressing the Prime Minister and his colleagues for a declaration of policy on behalf of unemployment, and all the satisfaction we have got so far is the long distance interview with the absentee Minister of Labour (Senator Robertson) in my province of British Columbia.
But the inconsistency of my hon. friend belongs not only to the past; it belongs to the immediate present. He began his tremendous indictment of the late Liberal administration this afternoon with respect to the Canadian National Railways by saying that in 1904 the then Liberal government was responsible for certain things. I believe that my hon. friend

was of age in 1904, I believe that he was then a strong supporter of the Liberal administration.


Robert James Manion: May I ask my hon. friend not to taunt me with the errors of my youth?


Ian Alistair Mackenzie: Mr. Speaker, the hon. minister said this afternoon that Sir Henry Thornton was able to speak for himself, and he condemned the recent Liberal administration for what he called their extravagant excesses in regard to capital expenditures on account of the Canadian National Railways. Let me tell my hon. friend that the discovery that Sir Henry Thornton is a great executive was first made by my right hon. leader who sits immediately in front of me; and let me add that the first political interference that Sir Henry Thornton ever had since he assumed control of the Canadian National Railways came the other afternoon from the hon. member for Stanstead (Mr. Hackett) who made a vicious attack upon the capital expenditures of that system. Then what happened? Seventy-five per cent of hon. members opposite pounded their desks and absolutely supported his remarks. But terror swept into the ranks of the ministers as they eat mute.


An hon. MEMBER:: The Liberal members applauded too.


Ian Alistair Mackenzie: Then we had the Minister of Fisheries (Mr. Rhodes) rise in his seat a week later and make a belated statement on behalf of the government that they are not antagonistic to the principle of public ownership, and we have the Minister of Railways this afternoon trying to do the same thing. But my hon. friends opposite cannot applaud the remarks of the hon. member for Stanstead and also applaud the remarks of the Minister of Fisheries and the Minister of Railways. And by the way, the inspired Conservative press contained the other day an announcement that my solemn friend the Minister of Justice (Mr. Guthrie) was going to the supreme court and that hi3 successor in the cabinet would be the foe of public ownership-the hon. member for Stanstead.


An hon. MEMBER:: That is newspaper
talk.


Ian Alistair Mackenzie: There is a strange silence in the Conservative press from shore to shore of this dominion in regard to the contents of the Bennett budget. Let me contrast that, sir, with the reception accorded the Dunning budget of May 1, 1930.

The Budget-Mr. Mackenzie (Vancouver)


Mr. GOTT:: It received a wonderful en-dorsation at the hands of the Canadian people on July 28, 1930.


Ian Alistair Mackenzie: My hon. friend from South Essex (Mr. Gott) reminds me of a quotation from Shakespeare's King Henry IV:
He was but as the cuckoo is in June, Heard, not regarded.


Eccles James Gott: Mr. Speaker, I desire to remind my hon. friend-


Some hon. MEMBERS:: Sit down.


Ian Alistair Mackenzie: Mr. Speaker, if the quotation is out of order, my hon. friend had better blame William Shakespeare.


Eccles James Gott: I should like to remind my hon. friend that the poets of the last parliament went down in the slide of July 28, 1930. Poets don't live long in parliament.


Some hon. MEMBERS:: Sit down.


Ian Alistair Mackenzie: I shall
never forget the reception accorded the Dunning budget by the press of London; Conservative, Liberal and Labour papers were a solid chorus in their commendation. The diehard Conservative Morning Post stated:
The Dominion of Canada has taken another step along the line of their traditional policy of giving preference to imperial trade, and since changes in tariff cannot fail to benefit the mother country, our first impulse is to express the gratitude which we are certain the British public feels.
The Daily Express, Conservative, said:
The Dunning budget constitutes the greatest advance in imperial relations we have seen since the war.
The London Times, Conservative, said:
The advantages offered by Canada to British industry are offered without any bargaining or corresponding concessions and the spirit which prompted them will be appreciated as much as their actual economic effect in helping British trade at a time when help is badly needed.
Mr. J. L. Garvin, in the London Observer, expressed this opinion:
The Canadian budget is one of those rare strokes of policy which illuminate the realities of empire.
The Times Trade Supplement contained the following:
There can be no doubt that Mr. Dunning's budget in the Canadian parliament is the most important preparatory step that has been taken by any government since the Imperial conference of 1926 towards the ideal of closer imperial economic cooperation.
The Congress of Federal Chambers of Commerce passed this resolution:
The council of the empire reiterates its belief that the wide extension of imperial preference is the most effective means of bringing about a greater measure of imperial economic cohesion.
The Hon. Neville Chamberlain, at Birmingham, said:
We shall have a chance of showing what we can do to supply goods Canada cannot supply herself.


Some hon. MEMBERS:: Oh, oh.


Ian Alistair Mackenzie: I know
this hurts my hon. friends opposite. Let me contrast that reception by the old country press of the Dunning budget of May, 1930, with the reception it accorded the Bennett budget. The first day of May, 1930, was a great day in Empire history?


An hon. MEMBER:: What about July 28?


Ian Alistair Mackenzie: I am
coming to that. I repeat the first day of May, 1930, was a glorious day in Empire history. But I predict that the first day of June, 1931, will become known as the "gloomy first of June," when the worst budget in Canadian history was presented to the people. Then we had the general election of 1930. What happened?


Some hon. MEMBERS:: Oh, oh.


Ian Alistair Mackenzie: Yes, I
am coming to it, I will face the issue. What, happened? The issues of the Imperial preference were obscured first of all by the issue of unemployment, and in the second place, by a plethora of promises unprecedented in the annals of Canadian election campaigns. From shore to shore the present Prime Minister, then leader of the opposition, scattered his promises with a wanton and lavish hand, and, as my right hon. leader said last night, the promises so made in 1930 are the taxes and burdens of 1931 upon the Canadian people. My hon. friends opposite raised the issue of New Zealand butter, and many of them on the evening of July 28 emerged triumphant politically with their hands dripping with New Zealand butter fat.


Some hon. MEMBERS:: Oh, oh.


Ian Alistair Mackenzie: The increase in the tariff of from four to eight cents a pound has destroyed our preference in the New Zealand market, and instead of "blasting" your way into the markets of the world, you are blasting the market of New Zealand away from Canadian products. What does

2722	COMMONS
The Budget-Mr. Mackenzie (Vancouver)
the president of the National Dairy Council say in this regard? Listen to the man whose views as quoted last evening were acclaimed 'by my hon. friends opposite. Speaking at the twelfth annual meeting of the National Dairy Council, held at the Royal Alexandra hotel, Winnipeg, on March 18 and If) of this year, he said:
At the last meeting, an appeal to the tariff board was decided upon. The hearings were held in January, 1930, and several months later the government announced an increase in the butter tariff of precisely the amount we asked for. At this point I wish to remind you very definitely that we took the view that a tariff of four cents per pound against the southern dominions, where the imported butter all came from, was about as high a tariff as the industry could obtain any permanent benefit from. We used the argument that a tariff higher than four cents would damage the cheese industry and would introduce very wide and unmanageable fluctuations of price into the butter market if we were to alternate from an import to an export basis and back again, as we have done many times in the past forty years. We told the government that four cents was enough for the reason that it was all that could be permanently advantageous. . . . Our conclusion was that the amount of the present protection would prove to be excessive in the long run and would have to be modified, so that the untoward events of the future cannot be laid at the door of this council. I wanted to make that abundantly clear and I think I did.
That was the president of the National Dairy Council of Canada.


An hon. MEMBER:: Read the resolution
passed by the National Dairy Council.


Ian Alistair Mackenzie: I shall
read exactly what I choose and the hon. gentleman can read the rest if he likes. Now let me remind my hon. friends opposite of that portion of the address of the Hon, Mr. Dunning in presenting the budget to the house last year:
With respect to New Zealand, as already intimated to parliament, the government of Canada has proposed to the government of that dominion that a direct trade agreement be negotiated to supersede the present arrangement.	_
We hope to be able to arrange for meetings of representatives of both countries in the near future in order to endeavour to reach a mutually satisfactory agreement. In any eyent, the present arrangement will cease on October twelfth next. Following that date, Canada will extend her full British preference to New Zealand, pending the completion of a direct agreement.
My province is particularly hurt by the abandonment of the preference. From 1922 to 1930, imports from New Zealand increased from $2,000,000 to $16,000,000, while exports increased from $4,000,000 to $19,000,000. In
fMr T Mackcnz'p/l
our trade wdth Austi'alia our imports in 1929 amounted to $3,500,000 and our exports to $19,500,000.
I remember hearing the Minister of Trade and Commerce condemning the Australian treaty because apparently the balance of trade was too favourable to Canada, and at the same time condemning the French treaty because the balance of trade was unfavourable to this country. By the way, I trust that the government will take steps immediately to negotiate with France with a view to removing the increase in their tariff against British Columbia salmon going into that country.
Let me now refer briefly to the remarks of the Minister of Trade and Commerce (Mr. Stevens) as reported at page 2309 of Hansard. The minister said:
Now I want to refer to farm exports just for a moment. Farm exports have fallen off. But let me give my hon. friend opposite a very unpleasant reminder. During the years that they held office-and mark you, we are now discussing that portion of my hon. friend's remarks in which he dealt with the fiscal policy of this country injuring exports; I want that to be borne in mind-during their term of office from 1921 to 1930, farm exports to the United States dropped from $162,880,000 to $40,841,000, or a falling off in nine years of no less than 75 per cent.
That statement is entirely misleading. Those are not the figures for nine years. They were taken from page 794 of the Commercial Intelligence Journal and they deal only with the ten-month period ended April 31, 1930, and that is a decrease of 75 per cent spread over a period of nine years. If the Minister of Trade and Commerce had pursued the figures down to April, 1931, he would have found that there was a reduction from $40,000,000 to $20,000,000, or 50 per cent in one year as against 75 per cent in nine years. That is my reply to the remarks of the hon. member.
Now I wish to deal briefly with the budget as it affects British Columbia and especially in relation to the coal industry. My hon. friend from Comox-Alberni (Mr. Neill) dealt ably with this matter the other day, as did my hon. friend from New Westminster (Mr. Reid). Let me give some figures with reference to coal production. According to the records Nova Scotia's production is 6,250,000 tons; New Brunswick's, 209,000 tons; or a total for the maritime provinces of 6,459,000. The coal output of Saskatchewan is 578,000 tons; that of Alberta, 5,704,000, and that of the Crowsnest 738,000, or a total of 7,020,000 tons. Vancouver island's output amounts to 1,107,000 tons.
After making the estimate as generous as possible, the only benefit Vancouver island

The Budget-Mr. Mackenzie (Vancouver)
will derive is the paltry sum of $20,000, whereas we estimate that, on a total output of 1,000,000 tons, we are entitled proportionately to $163,000.
I desire to quote from the Tory newspaper of the city of Nanaimo, the Nanaimo Herald, a paper which my hon. friend representing that constituency (Mr. Dickie) will recognize :
If Premier Bennett had gone into office with the one object of ruining the coal industry of Vancouver island, he could not have taken any surer means than are included in his budget proposals. . . . He has not even made an attempt to formulate a national fuel policy. He has begged the whole question, and so far as Nanaimo is concerned, and the people who have made their homes here, he has, like Pontius Pilate, washed his hands of the whole business.
Let me give another brief quotation from this journal:
Bennett was elected in Canada as the high priest of the gospel of protection. He went to London shortly after being elected, and came back to Canada, publicly accused by the British Minister of Labour as a master of humbug. So far as his budget proposals affect the island coal industry, he is the prince of humbugs, and the people of Nanaimo can write a curse across his memory.
Such are the compliments paid the right hon. gentleman by the Tory journal of Nanaimo. A few minutes ago I quoted from the remarks of the Minister of Trade and Commerce in regard to trade matters. I desire now to quote him with reference to unemployment. At page 2313 of Hansard he is reported as follows:
My hon. friend deplores that there is nothing in the budget referring to unemployment. I would submit to him and to hon. gentlemen opposite that this is scarcely the time, just in the spring of the year, for us to be making proposals to the house to deal with unemployment which may be anticipated next autumn. For the good of the country at large, would it be wise to do that?
I find that on March 31, 1930, my hon. friend from North Winnipeg (Mr. Heaps) moved a resolution to the effect that in the opinion of this house the government should take immediate action to deal with the question of unemployment. At that time the Minister of Trade and Commerce thought sufficiently of that resolution to support it, whereas in midsummer of 1931, when conditions are a hundred times worse, he thinks we might defer action on the unemployment situation until the return of Senator Robertson from British Columbia. Now, Mr. Speaker-


An hon. MEMBER:: Come back to Shakespeare.
22110-173J


Ian Alistair Mackenzie: I do not care to come back to something my hon. friend would not understand. The amendment to the amendment, moved by my hon. friends to my left, deals with the question of currency. I hope I shall not be out of order in this respect if I'disagree with my right hon. leader. In my opinion-and it is only my personal opinion-the question of currency is at the present time far more vital to the solution of our economic problems than any dispute about the tariff situation in Canada. I disagree entirely with the nature of the subamendment in dealing with the currency situation. I do not believe that depreciation of currency is the solution of this question. If my hon. friends had been somewhat more temperate in their amendment, if they had advocated the abandonment of gold as the single monetary standard of the world, without going so far as to propose an unlimited increase of paper currency, which is practically the consequence of their subamendment, I should have felt like giving them a measure of support.
I do believe, Mr. Speaker, that to-day there are some very distinguished economists in the world-I do not pretend to be one-who are emphasizing the doctrine that because of the disparity between the price of gold and the price of commodities, instead of a monometallic system there should be a duo-metallic system, or at least a standardization of the relative currency values of one or the other metal. If my hon. friends had only gone as far as that I should have been glad to support their amendment. In passing I should like to congratulate the Prime Minister upon the conference he had with Mr. J. P. Darling a short time ago.


Mr. CAMPBELL:: Might I be permitted
to interject, Mr. Speaker, that the subamendment does not advocate the unlimited use of paper .currency?


Ian Alistair Mackenzie: I am
very glad indeed to hear that from my hon. friend, but I think a fair interpretation of the meaning of the subamendment is that it does advocate the depreciation of currency and possibly the unlimited printing of paper currency.


Mr. COOTE:: It was not done during the war and would not be done now.


Ian Alistair Mackenzie: In this
connection, Mr. Speaker, perhaps I might be permitted to quote the final paragraph from a wonderful treatise upon this gold question; I refer to Doctor C. A. Curtis's article, "Canada and the Gold Standard":
2724	COMMONS
The Budget-Mr. Mackenzie (Vancouver)
To some it may seem a matter of little importance whether or not Canada maintains the gold standard.
In conclusion Doctor Curtis says:
From the point of view of the local interests of the citizens of Canada, the most satisfactory policy and the one which in the end will give the best return to Canadians is to allow the gold standard to operate freely in accordance with its designs and purposes.
As against that view you have very eminent world economists like Sir Henry Deterding, who absolutely advocates the remonetization of silver.
During the election, Mr. Speaker, we had a promise from hon. members opposite that Canada would return to prosperity immediately if they came into power. What has happened during the last fifteen or sixteen months? International Nickel has dropped from $999,000,000 to $148,000,000; International Petroleum has fallen from $472,750,000 to $128,000,000; Imperial Oil 'has crumbled from $1,092,700,000 to $128,000,000; Brazilian has crashed from $518,200,000 to $87,400,000; Consolidated Mining and Smelters has tumbled	from	$293,300,000	to	$38,300,000;Ford of Canada was swept from $111,200,000 to $23,000,000; Canadian Pacific Railway has slipped from $221,100,000 to $88,000,000; British American Oil has fallen from $95,900,000 to $23,000,000; Shawinigan has dropped	from	$241,800,000	to	$85,000,000;Montreal	Power has shrunk	from	$183,800,000to $90,900,000;	and Power	Corporation has
dropped from $62,300,000 to $19,400,000. That is an indication of the serious condition of affairs in Canada to-day, and shows the wonderful results of the efforts of the Tory party to restore prosperity. Now, Mr. Speaker, I come to the final problem, that of unemployment.


Pierre Édouard Blondin: Order; the hon. member has spoken for forty minutes.


Some hon. MEMBERS:: No.


Mr. RINFRET:: I submit, Mr. Speaker,
that the Minister of Railways terminated his speech at exactly five minutes to four.


Pierre Édouard Blondin: I am sorry. The hon.
member has ten minutes more.


Ian Alistair Mackenzie: I desire
to refer to the very important problem of unemployment, Mr. Speaker, and I shall conclude in probably five minutes. In amplification of the concluding portion of the remarks of my right bon. leader last evening in regard to a conference on unemployment, I wish to remind this house that item 426 of the supplementary estimates of the session of 1930 read as follows:
(Mr. I. Mackenzie.]
To provide for a conference of representatives of dominion and provincial governments, municipalities, transportation companies and industrial and labour organizations to consider methods of cooperation in furthering continuous employment throughout Canada during the winter months.
So the declaration of policy made by my right hon. leader yesterday afternoon is only an amplification of his pronouncement of policy made in this house last year, for which money was voted.
Now, Mr. Speaker, I wish to stress, as other members have done, the tremendous national character of the unemployment situation. I have had telegrams from the city of Vancouver pointing out that the situation there is exceedingly serious, and I desire to inform hon. gentlemen opposite that if ever in the history of Canada cooperation and national leadership were required, they are required at the present time. As far as I am personally concerned, if the administration announces to this house a policy in regard to unemployment which will look after the starving people and provide for them food, clothing and shelter during the winter of 1931, I shall be prepared to cooperate during the rest of this session as much as possible in regard to legislation before the house.
On the other hand, Mr. Speaker, I submit that it is the distinct duty of the government to proclaim to this parliament gathered together, as soon as they possibly can, what is to be their policy in regard to next winter. I wish to speak not at all in a partisan way in regard to this tremendous national crisis when I warn the administration seriously and solemnly that there are ominous murmurings to-day throughout Canada. Unless adequate preparation is made in good time by this administration it will be not only this government which will be endangered; it will be the system of government we have in Canada to-day. Sir, my contribution to this study of the unemployment situation would be along the lines of that famous utterance of that great Canadian patriot, Wiliam Lyon Mackenzie :
Well may I love the poor; greatly may I esteem the humble and the lowly, for poverty and adversity were my nurses, and in youth were want and misery my familiar friends.
I should like now to recommend to this house consideration of the concluding words of a great book written by the grandson of William Lyon Mackenzie:
Is it too much to believe that having witnessed humanity pass through its Geth-semane, having seen its agony in its garden of fears, having beheld its crucifixion upon the ci'oss of militarism, labour and capital will yet

The Budget-Mr. Geary
bring to a disconsolate and broken-hearted *world the one hope that is theirs alone to bring, and that in the acceptance of the principles which hold deliverance from the scourges that beset mankind they will roll back the stone from the door of the world's sepulchre to-day and give to humanity the promise of its resurrection to a more abundant life.
In conclusion, Mr. Speaker, I wish to assure the government once more that if they will bring down measures to protect our unemployed, perhaps by way of a great national loan in order to look after the problems of unemployment during the next year and a half and to protect men who are being forced out of business by foreclosure proceedings instituted by our financial institutions; if the government are prepared to issue a great national loan and bring down their policy on the floor of this house, I for one am prepared to remain silent with regard to any other discussions which may arise, and to support them in providing for our comrades throughout the length and breadth of this great dominion of ours.


Mr. G. R. GEARY (South Toronto):: Mr. Speaker, that the remarks of my hon. and gallant friend from Vancouver Centre (Mr. Mackenzie) were not displeasing to this side of the house is, I think, made sufficiently plain by the fact that we protested against his speech being cut off. I shall not follow my hon. friend through the course of his remarks, but in the vehemence of an early excitement he indulged in attacks upon my hon. friend the Minister of Railways (Mr. Manion). These attacks will be met easily, if they are worth meeting, by my hon. friend the Minister of Railways, and I shall not attempt to take his part. Suffice it to say that the hon. member rather upbraided the minister for the early part of his speech, in which he accused the minister of descending to personalities, but my hon. friend did not hesitate to do that very thing.
The speech of the right hon. Prime Minister was long; it bespoke an endurance upon which I congratulate him, and more than that, it established a record for the right hon. gentleman of remaining longest in the air.


William Lyon Mackenzie King: Is my hon.
friend referring to the leader of the opposition or to the Prime Minister?


George Reginald Geary: I refer to my right hon.
friend the leader of the opposition; I mentioned that the person to whom I referred had been longest in the air. The delight one might have in listening to the right hon. gentleman was somewhat marred for those of us who have been in the house during previous sessions by the fact that we have had
it all before. The right hon. gentleman loves to tell the old, old story, and the tales of the prosperity that attended his regime are very familiar to all of us. He ascribes to himself and to Providence, in the order named, the prosperity that he claims to have existed during the last eight years, but when we come to that bad period of his last year in office, he withdraws himself from the partnership and leaves poor Providence to bear all the onus of the disturbance. He is not quite fair; indeed, he has never been quite fair in his reference to the condition of affairs that existed at the time he came into power. He has always refused to admit that the grants to railways during the preceding years had any bearing whatever upon the financial condition as it existed. What my right hon. friend well knows, as Mr. Fielding said in 1922, is that during the period of the war the country had been very heavily taxed. Money was being given on all hands; people were cheerfully paying taxes and making contributions in the country's cause, and it was not within the power of any government which might have then been in power to exact more in taxes from the people than did the government of the war period. So necessarily, and I think largely with the consent of the house, advances were made to the different railways, amounting in the end to some $500,000,000. That went into the capital debt, but my right hon. friend has always insisted that that sum of $500,000,000 should have been raised by additional taxation during the period of the war. I do not think there is any foundation for any such statement, and if in the light of what I have said one reviews the financial condition of 1921, one will find-I have not under my hand the figures for more than six years, although I had them at one time-that during the six years prior to my right hon. friend's advent to power, the average annual surplus of the preceding government was $2,000,000 in excess of the surplus which accrued to the government during the first six years of the regime of my right hon. friend. There was something added to the debt, but very much less than would have been added if government had put the whole of the war expenditure into capital. The financing of that period, the carrying on of the vast undertakings of the war has been a creditable page in Canada's history, and my right hon. friend's criticism of it is entirely misleading in that he leaves out that very large amount of capital expenditure which should have been taken into account.
I come now to the speech delivered by the Prime Minister (Mr. Bennett) in intro-
The Budget-Mr. Geary

during the budget proposals which are now before the house. In my humble opinion that speech, masterpiece as it was, will stand as a model for budget speeches for many years to come. Not only did the Prime Minister give an exhaustive study and a searching analysis into the conditions, financial and otherwise, of the country, but he enabled us who heard his speech and who had an opportunity of reading it, to understand something of the causes, financially, which have produoed the situation in which we find ourselves to-day. It was an integral part of his presentation; it was the very basis and foundation upon which he built up the case of the country for the increases in taxation which were set out later in the proposals of the same speech.
Former ministers of finance have for many years contented themselves with a recapitulation of the operations of the preceding year, and added to it a statement of their proposals for raising money in addition to certain changes which they proposed to make in the tariff items. It did not occur to them that one of the main features of a budget is the prognostication of the income for the following year, so that when taxes are imposed and changes in the tariff made, there should be presented to the house at the same time a fair estimate of what those changes will bring in, in order that hon. members, in discussing the budget, will have before them an anticipatory result and will know whether they are budgeting simply to cover operating expenses or for an amount which may be used in the reduction of debt. Such a course has not before this year, in my experience, been followed. The result always has been that the minister of finance, although he knew he was budgeting for a surplus, was able to say when the next year came: Here is a pleasant surprise; I have a great surplus and I am reducing the public debt. Similarly in 1930, the then minister of finance, in introducing his budget, must have known quite well that it would result at the end of the year in a substantial deficit. That must have been in his mind, but the election was coming on; the party was going to the country on the basis of that budget, and that budget was designed to omit showing what he well knew must occur, namely, that at the end of the year there would be a substantial deficit.
When the government of the present Prime Minister (Mr. Bennett) came into office, they found themselves faced with this huge deficit which was left as a legacy, no matter how one may play upon the word, by the false budgeting of the preceding administration. 
Moreover, the Prime Minister was face to face with the inescapable fact that with existing revenues he would have to have a deficit in the year yet to come. Did he adopt the method of his predecessors? Did he take the easy course-bring down in his proposals, omit to say what his taxation proposals would realize, and then trust to luck at the end of the year, saying probably: We had a deficit; times were hard?. The Prime Minister took the courageous and the only sound business course of determining then and there that the budget of the coming year should balance; that as far as possible there should be sufficient revenue to overcome the expenses which could not be avoided. That resolve met with the commendation of the sound business sense of the country. We have no right at the present moment deliberately to proceed with the coming year's operations in the expectation that at some future time we are going to surmount an enormous deficit. Having arrived at that stage, which I am sure commends itself to the country, my right hon. leader undertook as Minister of Finance to levy the taxation which would be required for the purpose. Long before the house came into session, there was widespread discussion in the country as to what the new taxes would be. It was taken as a foregone conclusion that much more money must be raised. It was realized that the main source from which the additional revenue would come would be some sort of tax on transactions. This took the form of a discussion between an addition to the sales tax and, on the other hand, the imposition of what is known as a turnover tax. I am glad to see the Minister of Finance has adopted the former course and decided to increase to some extent the sales tax which was already upon the statute books. It was a well known tax and its operation was understood. The turnover tax was one which was unfamiliar to all classes of the community. I say that the probability of a deficit was known beforehand by the people and its effect was discounted. For that reason, when the budget came down, that fact being known, the budget, in its proposals, in its review of financial conditions and in all the matters which it contains-I know of none which can be an exception-has met with the approval of all classes of the community. I think that there can be no doubt about that in any way. I have not heard yet, with the exception of a few tariff items, an attack on one single point of the budget that is worthy of the name. The keynote was struck perhaps by the hon. member for Shelburne-Yarmouth (Mr. Ralston), but it was a faint'

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hearted and weak attack in every respect. I think the hon. gentleman knew very well that he had no ground for his attack, and no better example of it could be found than in the gingerly way in which he touched upon the imposition of the coal duties and entirely omitted, as far as I could see, to make any reference to the steel duties. This was like a red hot poker to him because he comes from a coal and steel country. Anybody who listened to his remarks must, I am sure, have gathered the impression that in truth he is in full accord with the coal taxes as we find them in the budget.
As to the various tariff items, Mr. Speaker, we shall have every opportunity to discuss them when the resolutions are in committee. In this regard the hon. member for Shelburne-Yarmouth largely contented himself with the quoting of some academic remarks from speeches of gentlemen who have lately been meeting in Washington. I do not think it is necessary to discuss that. Whatever general tariff conditions throughout the world may be, they are not of our making. We are met here with a condition and not a theory. We lie next to a country highly developed in industry, protected effectively, and ready to dump its surplus products into this country and destroy our industries. I cannot think that the people of this country for one moment would tolerate any government which will submit this country to a greater degree than it is liable already to the inrush of competition from the United States, let alone of other countries whose markets are not equally open to ours.
The hon. member for Shelburne-Yarmouth spent most of his time attacking the stand of the Prime Minister in regard to the Canadian National Railways. The hon. member is not present; I wish he were. I would submit to him that he went far out of bis way in a deliberate attempt, or if not deliberate, in a very thinly-disguised attempt, to spread abroad the impression, for party political purposes, that this government is opposed to the Canadian National Railways. I make that statement deliberately. He seemed to base his attack upon a very slim foundation. It was to the effect that in dealing with the sum of $604,000,000, which appears in the accounts as loans from the government, the Prime Minister had conveyed the impression, and as the hon. member for Shelburne-Yarmouth warmed to his work he conveyed the impression that the Prime Minister had deliberately led the house to believe, that this $604,000,000 had all been advanced during the eight years that the Liberal government was in power. Of course that is arrant nonsense. No one was
misled or deceived in that regard. The hon. gentleman said that he himself derived that impression from listening to the speech of the right hon. Minister of Finance. Well, if he did, he knew the facts, and if he were so anxious for a fair presentation of the case of the Canadian National Railways to the public, why did he not by one simple question set the Prime Minister right in that regard, if he were wrong. But he preferred to wait for four days, and gather together a collection of extracts from speeches, brief them and put them into a form where he could argue as an advocate in all the fine ways in which he is trained, in order to deduce the proposition that he was seeking to advance.
I was sorry to see that the hon. member for North Waterloo (Mr. Euler) departed so far from his usual common sense moderation as to join to some extent in the hunt, but I do not think his heart was in it. I do not think for one moment that he would wittingly lend himself to a deliberate attempt on the part of the opposition to convey to the people of Canada the impression that this government was hostile to public ownership and to the Canadian National Railways. Is there anyone in his senses who can find fault with the statement of the Prime Minister in that regard in his budget speech? I am sure that the hon. member for North Waterloo, himself a business man, as a director of one of his companies, would take the very same stand. I would be very much surprised if the Canadian Pacific Railway, which has been drawn into this discussion, does not through its president and directors at the present moment give the closest care and scrutiny to the expenditures and resources of that road. If we could peep behind the scenes I imagine that these gentlemen, who are just as directly confronted with difficulties as we are, would take no other step and no other attitude than that indicated by the Prime Minister in his budget speech as that which this government should take in regard to our own railway.
Outside of that there was a great deal in the speech of the hon. member for North Waterloo with which I agree. This country is committed to public ownership, and it has no regrets on that score. I can speak for my own province from personal knowledge. In Ontario we have embarked on public ownership of different enterprises in many directions, and we have had the greatest satisfaction. There is no body of opinion in Ontario which is opposed to public ownership. I understand that in the city of Montreal the view is not quite the same, and it was not surprising, therefore, to hear the hon. member for Stan-
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stead (Mr. Hackett) giving voice in this chamber not long ago to a view opposed to public ownership. It will serve no useful purpose here and now to enter into a discussion of the relative merits of the two systems. I think it is idle to say that public ownership cannot bring to the management of its enterprises as much skill as can be found by private ownership. The path of private ownership is strewn with financial wrecks. No such casualties as far as I know have occurred in the march of public owrership. I am perfectly satisfied to take my stand, which I believe is that of the rank and file of this party, that public ownership of the national railways is a thing which we do not regret on any score, but is something we are proud of and intend to maintain, and a thing out of which I think this government can make a decided success. Private ownership, of course, is always subjected to the temptation to make returns. That is by no manner of means a condemnation of private ownership. There are great concerns in this country which have been built up on the private ownership principle, and which have devoted themselves to the production of a product at a price that will be fair to the consumers and to the shareholders. Others there are which have not pursued that course. We know to-day of great concerns in this country which have come to grief just because of the greed of those who promoted rather than really owned. The Canadian Pacific Railway, of course, I exempt from any such charge as that. It has been built up on a sure and a proper foundation, and I think we must pay tribute to its management for the skill and business sense, yes, and patriotism, which has characterized its operations. I do not pay that tribute simply to the giants of the past who laid the foundations of and built up that enterprise, but equally to those splendid Canadians, who to-day are in control, particularly its president.
In this country we are bound to have a system of public ownership of railways. There is no regulatory power that can be exercised completely in regard to the rates of railway companies. I think that no board of railway commissioners, however constituted, could effect that result. The only proper regulation of a privately owned railway or of a series of privately owned railways is through a publicly owned enterprise. Competition alone can regulate the rates, and I venture to say that both the Canadian National Railways and the Canadian Pacific Railway benefit very largely to-day from the incitement of the competition that exists between them. So, Mr. Speaker, I think I am quite safe in say-
ing, and I say it without offence, to my hon. friend from Stanstead, who has a right to his own view, that he is decidedly on the wrong track, and in uttering that view he represents only himself in this house and perhaps a member here and there. Certainly he does not represent in any sense the rank and file of the Conservative party nor, as we heard from the Minister of Fisheries, does he represent in any sense the feeling of the ministry in regard to the Canadian National Railways.
I pass for a moment, Mr. Speaker, to the subamendment moved by the very thoughtful and serious minded member for Battle River (Mr. Spencer). And may I say that amid all the welter of fault finding and recrimination which we have heard from the opposite side of the house I can look only to certain of the hon. members in the far corner for constructive criticism of any sort. Those hon. members have some desire, as is evidenced by their speeches, to cooperate in the governing of the country. The subamendment does seek a way out, and I welcome it, although I think it is premature and with many parts of it I cannot agree. As a whole I do not think it can be substantiated. I shall refer to only one part of the subamendment, namely, the proposal that Canada should abandon the gold standard. One of the reasons given is that under the circumstances which existed in 1914, which are said to be parallel to those existing at the present time, Canada abandoned the gold standard. If, however, circumstances are parallel in any 'particular they are not parallel in the one particular that at that time all gold countries were going off the gold standard; Canada did likewise. At the present time, however, all countries are striving to maintain that standard. The proposal is characteristic of all soft money campaigns. It is a measure of inflation which is designed to produce more currency and credits than are required by the physical needs of industry and trade.


Mr. SPENCER:: If my hon. friend will
allow me to make a statement, the intention is to allow us to have enough currency to take care of industry and trade. At the present time we have not sufficient.


George Reginald Geary: Supposing we allow a depreciation in currency to the extent of 20 per cent, what is the result? The wheat farmer sells in Great Britain and obtains the currency of that country to the value of SI ,000. That money is returned to Canada and is translated into Canadian dollars. So translated it would bring to the pocket of the farmer $1,250. The inflation that is caused by

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the very act of depreciating our currency designed to raise prices has, in effect, raised prices. So that when we come to the point of spending that $1,250 at the stabilized price level we get for that $1,250 at the higher price level just as many articles as we would have received for the $1,000 at the previous level. That seems to be perfectly sound reasoning.


Henry Elvins Spencer: Absolutely not.


George Reginald Geary: My hon. friend will of course disagree; that is his privilege.


Milton Neil Campbell: I would like to remind the hon. member that outside the value of commodities there is the very important factor of the increase in our .public and private debts to an abnormal extent by the recent drastic deflation.


George Reginald Geary: That is a branch of the subject I had not mentioned. My hon. friend has in mind the fallacy that in regard to debt reduction the inflation of currency would help. That is attacking however by an unsound financial method a problem of an entirely different sort, and it does not seem to me that the two can be intermingled. To admit, as I think we are bound, that this depreciation is an unsound method of finance, and then say that it may apply to some other conditions, I think is quite beside the point. The statement is made that Australia has benefited by a withdrawal from the gold standard. I have seen no evidence to show that Australia has benefited in any degree whatsoever. The Australian farmer may receive three shillings whereas the Canadian farmer will receive only fifty cents. If however the farmer in Australia receives three shillings, under the price levels existing in Australia to-day that three shillings will not buy him as much of the commodities he desires to have as will the fifty cents of the Canadian farmer. May I throw out the suggestion that the Canadian farmer is not concerned with the price of a bushel of wheat, but with the exchange value. I can see that the exchange value would not be increased in the slightest degree by a deliberate inflation or depreciation of our currency. I do not suggest that my argument disposes entirely of the proposal. I do say however that there are considerations which certainly should be examined with great care. I hardly think my hon. friend would expect his proposal to gain the support of all hon. members in the house, but his suggestion offers a matter for discussion. I know my hon. friend will give quotations from the works of eminent economists in support of his proposal. I am equally aware of the fact however that just as many, and manv more, economists can be found who
will say that the proposal of my hon. friend is not sound.
May I however in passing tell the hon. member for Battle River to be of good cheer. His subamendment is not yet lost. Remember the days of the subamendment to the debate on the address. My right hon. friend the leader of the opposition may well find that the exigencies of the occasion justify him and his followers-at least those of his followers who will follow him-to vote for my hon. friend's amendment to the amendment. My right hon. friend may find, as he found once before, that the good blue pencil is the best weapon after all. He may find that after striking out all the words after "whereas" in the amendment he will be just as ready to vote for it as for the amendment, if by that action he may get the support of the hon. members in the corner of the house. Although my right hon friend may be a bit censorious, as I indicated, he may have the desire once more to effect a juncture in the voting power of the two groups opposite me in the chamber. As I look back on the debate on the address the et tu Brute of my right hon. friend rings in my ears. My right hon. friend who used to refer to the hon. members in the corner of the house as "Liberals in a hurry" had lost their support, but apparently at the time of the debate on the address he desired a rapprochement. As I say, after the vote on the address he turned upon them in a censorious manner and, as he believed, set my hon. friends in the far corner exactly in their places. However, the two opposing groups are together in some particulars; they both indulge somewhat in counsels of despair. We have been told by the hon. ex-Minister of Justice (Mr. Lapointe) that we are prophets, major and minor. He is right; we are if you like, prophets, major and minor. So far as Canada is concerned we are prophets of faith, hope and courage. We do not follow the counsels of despair we hear from other parts of the house. We know that there is distress in all parts of Canada, but we do not purpose to lie down and do nothing. We are going to assume the burden. To use another simile we are going to take the labouring oar and fight the matter out. We do not assume the attitude of our hon. friends opposite who send a greeting from the one to the other across the abyss of interrupted friendship which might be expressed in the words:
Welcome kindred gloom
Congenial horrors hail.
We, on this side of the house will fight it out and find the remedy.
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My hon. friends opposite seem to be very much concerned about the attitude of this government in regard to unemployment. All that can be done in regard to unemployment will be done. The example given in the past by this government has shown that it can do, and is prepared to do and will do, more than any other previous government has tried to do.
Its record shows that it can do, and will dlo more than any other government has ever tried to do on behalf of the unemployed. Contrast this attitude towards unemployment with the attitude of my hon. friends opposite just a year ago, when they put up their Minister of Trade and Commerce (Mr. Malcolm) to declare that whatever unemployment existed had to do only with seasonal occupations, and when in fact they derided the existence of unemployment, and took no measures to relieve it. But, to-day they admit there is unemployment, and they demand that this government, whose members then recognized there was unemployment and today are doing their very best to afford relief, should not be entrusted to take such measures to deal with the problem as may from time to time be necessary. That there is no declaration in the budget of any policy in regard to unemployment is no indication that the government will do nothing. On the contrary, their record so far is an assurance that they will do their utmost to solve the problem, and indeed we have the statement of a member of the cabinet that the matter is occupying their attention day by day, that they are giving it most sympathetic and careful attention, aware of the distress and determined to see to its relief. I think we can trust this government, as we could not trust a government composed of hon. members opposite, to effect a solution of this difficulty.
The hon. member for Sherbrooke (Mr. Howard) looks to be a successful and prosperous businessman, as I believe he is, but to my great surprise he advanced the proposition that we should not impose taxes to balance our national accounts; on the contrary, that we should let them become a capital charge; and to my greater surprise still, many hon. members on the other side of the house applauded that sentiment, with the notable exception of the right hon. leader of the opposition and the former hon. Minister of Justice (Mr. Lapointe); they sat silent as the tomb. I think they must have writhed inwardly when they heard that suggestion. They must haye thought of the many occasions on which they have boasted

of the action of their Minister of Finance, Mr. Fielding, in 1922. Boasted of what? Of the fact that to meet the deficit which was sure to come he imposed new taxation, for he declared that the first requisite of sound financial administration was to balance the budget. Is it any wonder that my right hon. friend opposite could not applaud the statement of the hon. member for Sherbrooke? To-day history repeats itself. Then the vast effort of this country in the war, the providing of pensions, and the expenditures necessary for railway rehabilitation required a large addition to the public debt, and also to the amount of money to meet the annual outgo. To-day this government finds itself heir to an enormous deficit left by its evicted predecessors. In those days Mr. Fielding refused to accept responsibility in regard to revenues and expenditures for a year during only part of which he had been in office; to-day we find the same situation. Then the government of the day decided to balance the budget; to-day the same course is being taken. Then it became necessary to impose new taxation; to-day we find ourselves under the same impelling necessity. The taxes, strangely enough, that were imposed by the government of the right hon. leader of the opposition-which I hope he will remember-were, in essence, the same sort of taxes that are being imposed to-day. Then there was a sales tax. Mr. Fielding in 1922 raised that by one-half, and next year he raised it to six per cent. We are raising it from one to four per cent-not nearly to the point he raised it.
We have been chidden to some extent by hon. members opposite for our motions of the last two or three sessions to abolish the sales tax. We were perfectly right; the sales tax should have been abolished when we moved those resolutions. It was retained long after the necessity for it had passed. When the government of the day was amassing large surpluses and there was no further need of a sales tax, that tax was continued for the purpose of swelling the revenues and enabling the finance minister of the day to boast a surplus. At that time he also increased the "nuisance" taxes. Beyond the tariff increases I know of nothing we are doing to-day that they were not doing at that time. Perhaps that is the reason there has been no attack of any consequence made upon the proposals.
In conclusion, Mr. Speaker, may I say what I am afraid is merely a repetition, that the people have got some sense, they are not ignorant of the conditions that confront the government. They know that we fell heir to

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this legacy of debt, they know that proper business principles impel us to wipe off all that debt, and they are not of opinion that it should be wiped off by charging the deficit to capital account. And because we have taken a bold and courageous course, not letting things ride, to use a .colloquialism, for another year, but facing the situation and fighting it out, for the very reason that the people admire a fighting man they are behind the Prime Minister in his efforts in that regard. Whatever one may say of the tariff proposals -and they are proper matters for discussion- I think we can close this debate resting perfectly assured that although the people do not like to pay taxes, they have enough sense to know, and do know, that this government is imposing taxes in the proper and only way in which under the -circumstances they should be imposed.


Mr. WILLIAM IRVINE (Wetaskiwin):: Mr. Speaker, I have forty minutes in which to deal with the budget, the amendment to the budget, and the amendment to the amendment. Everyone knows that that is an impossibility. I must therefore confine myself to particular phases of the motion and the two amendments. First I shall deal with the subamendment and endeavour to answer the arguments put forth by those who have found it necessary to disagree with us in that regard.
With respect to the subamendment, may I say in the first place that it affords us an opportunity to protest against certain items in the budget to which we take exception. There is no other provision under the party system foy which we can make an intelligent protest against anything that we might disagree with in the budget. Later I shall refer specifically to some of those matters on which we disagree with the government. In the preamble of our amendment we have indicated our conviction that there must of necessity take place fundamental changes in the economic system before we can expect to be relieved of the depression and human suffering with which we are surrounded at the present. We indicate, further, the course to be pursued and the goal of our reform, namely, cooperation for the highest human values, rather than competition for profit. Recognizing that to remodel the entire economic system of the nation will require a great deal of thought, a great deal of planning, and a great deal of time, we have put forward a specific proposal which we thought would bring some immediate relief to the people. That specific proposal, as everyone knows, is the proposal to suspend the redemption of dominion notes in gold-not necessarily to suspend such redemption forever, although I would very
gladly do that; we suggest nothing more at the present time than a temporary suspension of that redemption.
Now, to deal with these three things separately. Let me say before I take them up in detail that there may be some question as to our tactics in moving an amendment at this time. Indeed, the leader of the opposition (Mr. Mackenzie King) did take exception to our tactics and charged us with playing party politics. I am afraid I shall have to agree to a considerable extent with my right hon. friend in that regard; not that we designedly played party politics, but that being in a party institution it is just as difficult to stay here without playing politics as it would be to fall into the sea and come out without getting wet. I agree with him to this extent, that in moving the amendment to the budget we have adopted heretofore the party psychology. I frankly tell the house that I personally am opposed t-o the party psychology. Let me read the motion which is before the house. It is: that Mr. Speaker do now leave the chair for the house to resolve itself into committee of ways and means. That is the motion.
I suggest that in future all independent members who are dissociated from the major parties of the house should adopt a different policy entirely in dealing with the budget. We should vote for the motion to go into committee, as the motion proposes, and if there be anything in the budget with which we do agree, when the resolutions reach the committee stage we should take the opportunity of moving an amendment to every specific item from which we dissent. By taking that course we should escape from the party entanglements which always lie in wait for an independent member in connection with the budget vote, and at the same time we should be able to vote on specific issues, disentangling them from the tremendous mass of issues of which every budget is composed. .
Let me give to the house an example of the absurdity with which I am personally faced at the moment. And I shall take only one example out of a hundred. I am asked by one vote to decide whether or not I want the five cents a bushel bonus on wheat; and on the other hand I am asked to decide whether or not I am in favour of the reduction in income tax on higher incomes. Now, frankly, I am in favour of the five cent bonus on wheat, and I should like to vote for it. But I am decidedly opposed to the reduction of the income tax on higher incomes and I want to vote against it. But I have only one vote. I am asked to vote yes or no; I want
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to vote yes and no. I hope that the independent groups in parliament will from this time take such a course as will free their own minds from this absurdity and give us an opportunity to vote on issues on their merits.
Let me come now to the various parts of our amendment which I enumerated a few moments ago. I shall deal first with our conviction that the economic system requires some modifications. Let me point out, what perhaps it is scarcely necessary to indicate to this assembly, that events are demonstrating more and more clearly each day the necessity for some fundamental changes in our economic system. Let me present to this house the actual condition with which we are faced, having regard also to the amendment which we have moved.
The more we produce the less we consume in relation to the output. The more goods that are produced and unconsumed, the more unemployment; the more unemployment the greater distress and depression; and the more distress and depression the greater and more imminent is the danger to society. Now let us follow out the reasoning of these propositions.
Production under the capitalistic system is undertaken only for profit. To make a profit goods must be sold for more money than was expended in their production; otherwise there can be no profit. Now let us take the national output or the output of the world. Some of my hon. friends like to talk about the world. Very well; let us take the world or the nation, whichever you choose. The national or world output of goods, it is obvious, cannot all be sold for more than was expended in their production. Therefore under a profit system they cannot all be sold. There must remain a surplus, to buy which there is no money in circulation. That surplus forms the basis of unemployment, and unemployment is measured by that surplus in every country of the world. Briefly, then, this is the reason why the present policies of both major parties in this house must inevitably fail in the ultimate.
The party opposite, now in office, stands for more production, more factories-a splendid ambition if we were in a position to reap the benefit of this increased production. But since the people cannot buy what is already produced, it will not help them to know that there is still more produced which they cannot buy. There is no comfort in that. Since unemployment is caused by the surplus which cannot be sold, more production which cannot be sold will cause still more unemployment.

Then turn to the other party. It argues that if trade between nations were freer we should be able to trade ourselves out of unemployment and into prosperity-rather a novel conception. This I regard as a doubleheaded fallacy, because every other nation is as helpless and as hopeless to buy goods as we are, and for precisely the same reason. Moreover, there is in almost every civilized country of the world, a surplus of the very goods of which we have a surplus. That is not absolutely true in detail, but I say that in the main, and in respect of civilized countries, it is true. There are no foreign markets, and if there were foreign markets, foreign markets would not increase purchasing power of the countries concerned. Foreign trade properly considered is only fair exchange, purchasing power remaining the same in both the bargaining countries.
Now, it was with a view to increasing temporarily the purchasing power of the country, thus relieving the pressure in Canada, that we proposed to suspend the redemption of dominion notes in gold. The hon. member for Macleod (Mr. Coote) argued very ably and very clearly this whole subject. I can only touch upon it, there being so many other matters to which I must refer. I have argued this subject many times in this house. The very first speech I ever made on this floor was on this subject. At that time I warned the then government that they should not be tempted to go back on the gold basis, pointing out to them that to do so at that time would very materially increase the debts, both personal and public. I showed that it would place agriculture in particular under a burden from which it would be very doubtful whether it would ever emerge. I can remember the scoffs which came from the government benches on that occasion.
I am glad to note that ten years later the right hon. leader of the opposition, then the Prime Minister, thinks enough of our proposals to take a little time to argue against them. That marks at least some advance. In his speech of great length and breadth, which necessarily yielded some of its depth to the other two dimensions, the right hon. leader of the opposition gave some attention to the subamendment. He spoke favourably, if vaguely, with regard to international cooperation. That is all very well, but we want cooperation in Canada. I would stand for cooperation in Canada if there were not another nation in the world wanting cooperation. If it should take all the nations of the world all time to become cooperatives, I do not want Canada to wait that long. It is all

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very well to talk about international cooperation when there does not exist one international body in the world possessed either of the idea of cooperation or the authority to take the first step in that direction. We have no power, either, to bring the other nations of the world into cooperative action, and therefore I say for the right hon. leader of the opposition to place the seal of his endorsation upon international cooperation is merely to make an appeal to the empty sky.
I ask, then, for cooperation in Canada. Russia used to think that her communism could not be established unless it were done by international revolution, and I venture to say she spent a good many months and years trying to incite the other nations of the world to revolt, and thus to carry out her program. Eventually she discovered that if she were to have communism she would have to have it in Russia and leave the rest of the world to mind its own business. I do not argue that we should ignore the rest of the world, but I do say that our best contribution to international cooperation can be made only by building up cooperation In Canada. I want cooperation in Canada in the production of goods; I want cooperation in the distribution of goods; I want cooperation in farming; I want cooperation in finance; I want cooperation between the working people of this country and the bankers and financiers. If we cannot get that kind of cooperation then the principle of cooperation must be thrown overboard. I refuse, however, to wait for that cooperation until it is established internationally. We must begin at home.
The leader of the opposition apparently was unable to see any benefit in our next proposal, which was to renounce the gold standard. I agree with him, however, in his criticism that the advantage which might be gained by a country going off the gold basis is very largely lost-though not entirely, as he claimed-when other countries take the same action. I agree with that part of his criticism, but he forgets that we are now suffering from a disadvantage because our competitors in the world's markets have already gone off the gold basis. Thus the only possible way we can have even a fair chance with them is to have our monetary system at least upon a basis comparable to theirs. So the primary objeot in moving the amendment in this connection is, in short, that we may be placed on a fair basis with other countries competing with us.
Let me put it in another way: we want to abandon the gold basis for a reason similar to that which made the Liberal party continue a protectionist policy through a long regime
in office; that is, in order to adjust ourselves to our competitors. That is not all that would result from such a proposal, however. It would decidedly reduce debt. Just as debt was increased in Canada when we went on the gold basis, so debt would be reduced in exactly the same way by getting off the gold basis. I say to this parliament that this government and members of this house owe it to justice and to the people of Canada to inflate now to the same extent that deflation took place under the previous government after the war. When, as I have often said in this house, the debt of every farmer, and the national debt, was more than doubled. That occurred in this way, that it took two bushels of wheat, two hours of labour or two units of any other sort to do what one unit could have done prior to the deflation. That is how it increased our debt.
In substance, the right hon. leader of the opposition argued.that if there had been any intention to go off the gold basis, provision should have been made for that action before refinancing took place. I think the inference is that it would be unfair to bondholders for us to go off the gold basis now, after they have reinvested and have been reassured of the gilt-edged character of their investments. It was very unfortunate for the people of Canada that my right hon. friend did not see that point when he was in power; he deliberately went on to the gold basis, thus placing a burden upon the people of Canada which would be in part placed upon the bondholders if we were to do the reverse now. The unfairness on that occasion was directed against the general public, and the unfairness on this occasion would be against the bondholders, but since the bondholders already have reaped their advantage by deflation, the general public should have a chance to get squared by an equal measure of inflation.
To abandon the gold basis is, of course, frankly admitted to be against the interests of bondholders. To return to the gold basis was against the interests of the masses of the people. My right hon. friend betrayed his millionaire psychology through his own eloquence. Is it not amusing that in the same speech in which he so properly, and with such deep emotion, condemned the government for having reduced the income tax on the higher incomes, he should have rushed to the defence of the bondholders with breast bared to the enemy? Yes, the abandonment of the gold basis would reduce the incomes of bondholders, and so the right hon. leader of the opposition rushes to defend them. What law of justice or of economics; what rule of ethics permits the right hon. gentleman to arrive at the conclusion that it is a good policy to
The Budget-Mr. Irvine

defend the interests of the bondholders as against the very life of the Canadian people, the wage earners, the farmers and the merchants of this country? The price of wheat may decrease to the vanishing point; the debt of the farmers, by deflation, may be heaped up to twice its original size; the wage earner, through deflation, may go on short time and thus reduce his income, or eventually he may be thrown out of employment and have no income at all; the bread winners of Canada may not be able to provide for their families and there may be hungry children in this country, but that did not seem to arouse the sympathies of the right hon. leader of the opposition when he was in power. Now, however, he is aroused by the mere suggestion that we should reduce the interest and consequently the profit on bonds. Should not the wage eaner, the farmer, the hungry children of Canada, have a status in this parliament equal to that of. the bondholders? I venture to suggest to the right hon. leader of the opposition and to the bondholders that the time has come when bondholders must bear their share of the burden of depression and distress which our false financial system has placed upon the country. No longer is it possible to defend a situation which thrusts all the suffering resulting from a faulty economic system upon the masses of the people-people such as walked up the front steps of this building yesterday demanding work or the hundreds who sleep on the dumps of the cities or the hundreds of thousands throughout the Dominion of Canada who must have charity or starve. If we are passing through a world depression for which no individual is responsible, then all classes in Canada must be prepared to bear their share of that burden.
I come now to the amendment which contains a lot of "whereases," a lot of regrets and a number of platitudes. Those are the three divisions of the amendment. I shall not deal with the "whereases," although some of them are inaccurate. I shall not trouble with the regrets, because regrets produce no results. I shall comment on the platitudes, because sometimes platitudes do a great deal more harm than good. Under the division of platitudes, the amendment reads:
That the existing economic depression can only be overcome by policies which are of a character,
(a)	to relieve unemployment,
(b)	to restore to a condition of parity the relation between the purchasing powers of all classes,
(c)	to bring about more equitable distribution of the burdens of taxation.,
(d)	to encourage the expansion of the external trade of the country.

Supposing a doctor said to a patient suffering from insomnia: The way to cure insomnia is to accept treatment which will restore natural sleep to you, my man; or if he should say to another: The way to relieve the hungry from the pangs of hunger is to give them food -everybody knows that. That is analogous to the platitudinous attempt of the opposition to make the people think they have made a fruitful proposal. They have made no proposals; they have said what everybody would say and nobody would disagree with, and it does not matter whether it is said or not. There is not a word in the amendment as to how all these good things are to be accomplished. Of course it is intended that the house and the country should presume that the policies of the Liberal party will supply all these things, but there is a long record of deeds to nullify the presumption. If the last ten budgets brought down by the former Liberal government had contained policies such as "to relieve unemployment," "to restore parity of purchasing power," to "equalize taxation," and to "expand foreign trade," there obviously would have been no need for this amendment at this time. But unfortunately for Canada, and perhaps for the Liberal party, they brought down all these budgets without including any policies of such a character as would produce those results. So we are led to reflect upon what might have been. That recalls to mind these lines:
For of all sad words of tongue or pen,
The saddest are these: "It might have been!"
In further criticism the leader of the opposition proceeded to deal with what I would call the Liberal theory of relativity of trade. I have no time to expose in detail what I regard as the fallacies of that position, but I want to answer it in a manner which I think will be sufficient for my present purpose. All the house remembers what the leader of the opposition contended with regard to the relativity of the natural conditions in a country producing the same kind of goods, so that a jack-knife produced in the Argentine traded for a jack-knife produced in Canada, is the proper way to trade, and we ought to welcome it. That is, of course, my characterization of his position. But let me follow that up. Let me assume the absence of all tariff barriers in Canada. Let me assume the internationalism about which my right hon. friend speaks. In short, let me. assume "the federation of the world and the parliament of man," and the leader of the opposition as prime minister. I should like to ask him whether, under those conditions, we would not still have unemployment. He would then add the unemploy-

ment of Europe to the unemployment of Canada and the unemployment of the north American continent to that of the orient, and he would have exactly the same problem now under a prime minister of the world as we have in Canada under a national prime minister, because merely extending the boundary does not at all increase the purchasing power. Unfortunately, however, I must leave the consideration of that in order to deal with the budget itself.
The high compliments which have been paid to the Prime Minister and Minister of Finance (Mr. Bennett) for the comprehensiveness of the budget and for the lucidity of his presentation of the business affairs of the country have been well merited. I should like very briefly to point out in respect to the budget the few things with which I agree and to conclude with the things with which I do not agree. First I wish to commend the government for having provided a five cent a bushel bonus on wheat. It is not enough, we say, but five cents a bushel will be a little increase to the purchasing power of the farmers of western Canada in particular, and everybody who knows anything about the situation, realizes that that will be of great value. But of even greater value than that is the implication that from now on, if tariff policies are to be persisted with, there must be compensation for agriculture for the extra burden which the tariff imposes. The leader of the opposition called this bonus a sop. Let me remind him that for many years he maintained a very high tariff and never even gave a sop. In this matter I declare my view that the government is to be commended on giving this. I am going to tell the government later why it should not be commended for not doing other things. Next I say that the government did well when it imposed a tax upon income from foreign capital. That was another very good thing to do. It did good work also when it increased the income tax in a certain division, shall I say? I shall deal with the other divisions later. But from, I think $3,500 to $130,000 or so there has been an increase in the income tax which will bring a greater revenue to the country than previously. For these things especially I feel that the government ought properly to be commended.
But let me now turn to the other phases of the budget with which I do not agree, and I think the outstanding one is the reduction in the income tax on the higher income. I agree entirely with the leader of the opposition on this point; I think his forceful criticism in this respect was well taken. Let me say in all friendliness to the government:	I
The Budget-Mr. Irvine
do not think you can afford to do it. It really does not make very much difference to the income after all. There may not be many people who will be affected by this alteration, but if there be one or, as the leader of the opposition says, even if there is not one, the very fact of the willingness on the part of the government to make this alteration is an unfortunate psychological condition. In view also of the fact that there are in the ranks of the governing party men who may have a little bit more money than I have,-this may be doubtful, but some may have a little more-do not give the public a chance to say that you are trying to protect your own necks by this petty reduction. Put this item back on the old schedule. I hope the government will do this. In fact, I noted when the Minister of Finance was making his speech, if I recall it aright, he said he had taken this item exactly as it was presented to him by the officials of the department. That statement may be regarded as leaving the back door open, and I sincerely hope that before the budget is passed he and his government will go out of that back door, taking the reduction objected to along with them.
I want next to oppose the change in the stamp tax on cheques. The ten dollar limit has been removed. Let me point out to the government that this tax falls very heavily indeed upon the farmers, who deal in small milk cheques, egg cheques and butter cheques. Many of these cheques amount to only sixty cents apiece, and on that sixty cents they must pay two cents. I know that the government will argue that the purchaser of the farmers' goods will pay the stamp tax. Yes, but ultimately he charges that back in reduced prices to the farmers who sell the goods. Whether he does so or not, let me tell you that the farmers believe that he does. For all the extra money that this change in the tax will bring, I think there ought to be modification. At least limit it to cheques over five dollars. Let me suggest another change. Charge four cents on every cheque over thirty dollars, and in that way you will perhaps get more money than you will lose by exempting cheques up to five dollars.
I come to the last point of disagreement, and that is with respect to unemployment. I think all members so far have regretted that there has been no definite policy announced by the government in respect to unemployment relief. I am not entirely convinced, Mr. Speaker, that the budget is the proper place to bring forward a program of relief for unemployment. I think that it is not
2736	COMMONS
The Budget-Mr. Irvine
if for no other reason than this, that no one knows just how many millions of dollars are going to be required to take eare of unemployment during the next year. But when I say that, I say this also, that I do not think this parliament should prorogue until the government has clearly announced what its policy in this respect will be and the necessary legislation has been provided to enable it to carry that policy into effect. I am in hopes that the government has no other intention than to do that, and so I am not going to criticize it for not doing what 1 cannot believe it will not do.
In respect to the relief of unemployment let me emphasize one or two constructive suggestions, whether they are so regarded or not. I would lay it down as the first principle of relief that every man, woman and child in Canada who is in want through unemployment must receive adequate food, clothing and shelter. That is the first principle for us to lay down, and this government must accept the responsibility therefor.
Next I would suggest that in order to provide these necessities we should organize in all the larger centres of Canada, bureaus for the distribution for free food and free clothing to all registered unemployed, and that such food and clothing shall be purchased in Canada, that food such as butter, eggs, and bread shall be purchased from the farmers of this country, and the clothing and boots shall be bought from our Canadian factories, and that in accepting that responsibility we shall see to it that our people receive at least a bare living from the industries of the country. Less than that we cannot do.
I would suggest also that the committee or board suggested by the right hon. leader of the opposition might be a very good means of carrying into effect the proposals which I have just made.
As to the solution for unemployment, that is a very different .question. I never have thought that any modification of the tariff would cure unemployment. That is one reason why we do not mention the tariff in our amendment. We know perfectly well that it will hot effect a cure either for unemployment or for the economic difficulties of agriculture. Let me give an example of the problem which unemployment involves. According to an article in MacLean's Magazine last summer, at the end of 1931 there will be released in Canada sufficient horse-power from the development of hydro-electrical energy alone to do the work of 50,000,000 men. That is only one single .phase of the industrial system. It must be clear that by substituting solar

energy and mechanical appliances for the muscular power of men we have very, very materially increased our powers of production, and thus reduced the necessity for man power. There is the crux of the problem. But the problem cannot be solved by maintaining the same system. There is no hope of finding an outlet- for our products in other countries, as the leader of the opposition suggested. There was a time in the history of capitalism when a large portion of the world was unexploited, and when to seek markets in other countries had some meaning, but aft this stage of capitalism, when the entire world has been exploited, there is no possibility of finding relief through foreign markets for our surplus production. So I say that, in order to meet the problem which I have just tried! to illustrate by that one statement of fact, we must take a course cooperative in nature which will make the industries of Canada keep the people of Canada, instead of the people of Canada keeping the industries of Canada. We shall discover from year to year as we go along accepting responsibility for unemployment, that the only source from which we can draw to carry out that obligation is our industries, and ultimately we shall have to take over our industries or put them on a cooperative basis in order to secure the necessary supplies.
In conclusion, Mr. Speaker, let me say that I believe that the evidences of the age in which we 'live, and the great events with which w7e are faced, clearly demonstrate that we are passing out of the old competitive capitalistic system into a new. But the great problem is, how shall it be accomplished? What method shall be followed? One class of people says: We will do it by revolution. Another class says: We will do it by evolution. Another class says: We do not require to do it at all because this old system, praise God, is eternal. Those are the three conditions of mind of the people of Canada alt the present time. Revolution, to my mind, is the way of distress and ignorance, but it is inevitable if we are going to have a class of people who will persist in maintaining that there is no need of any modifications. If we are going to effect the change from the competitive system to the cooperative system by evolutionary process, it is necessary that we recognize responsibility in the evolutionary process. Responsibility for the evolutionary process cannot be exercised or discharged simply by sitting quietly and doing nothing. We must plan for evolution. If we would escape the disaster that hangs over the world at the present time we must first come to the conviction that modifications of the present

The Budget-Mr. Veniot
system are inevitable, and then we must plan how to make those modifications with the least possible dislocation and the least possible human suffering. I hope that the cooperation which has been suggested by the hon. gentleman who preceded me (Mr. Geary) and by other hon. members of this house will ultimately take possession of this parliament. Who knows how to fix up this unemployed question? Not one of us. Why should we try to make political capital out of our economic blundering with its unavoidable suffering?
I would characterize the amendment of my right hon. friend to my night as a drag net cast into the sea of our discontent in the hope of gathering therefrom party advantage. This is not a time when we can dare to tamper with a situation of this kind. I plead with the government and with the parties in the house, I plead with the moneyed men of this country, the bondholders, the bankers, and the employers, that we are sitting on a volcano and nothing but cooperative intelligence will save the situation.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Peter John Veniot: Mr. Speaker, in rising to contribute my quota to the debate on the budget, I wish first to extend my congratulations to my right hon. leader (Mr. Mackenzie King) for the very able, interesting, eloquent and forceful enunciation of Liberal principles made by him last night. I have been a Liberal all my life; in the thirty-five years that I have been in active public service I have never seen any reason why I should be otherwise. I have been proud of being a Liberal, but never was I so proud as last night when I heard my right hon. leader enunciate the principles of the Liberal party.
Before I undertake to discuss the budget, I wish for a short time to pay my respects to the hon. member for Northumberland (Mr. McDade). I may say that I was amused and somewhat surprised to hear my hon. friend in his maiden speech express the good feelings he had towards your humble servant in one breath and in the next breath make a personal attack against me. I hope that my young friend will come to learn that tactics of that kind are better left aside, especially when we are dealing with the important questions that are before the house 22110-174
and the country to-day. I am sure, sir, that on sober second thought he will realize how far such an exaggerated sense of ego as has characterized his speeches lately may, if not restrained, lead him into the realm of absurdity. In his personal attack on me the hon. gentleman referred to the reduction of the usual majority which for a long number of years I obtained in the county I have the honour to represent in this house, and he said that the handwriting was on the wall. Let me say to my hon. and juvenile friend from the county of Northumberland that at the next election there will be no "handwriting on the wall" so far as he is concerned, but the rattling of the bones of the political skeleton will remind him of the violated pledges made by himself and by his leader during the campaign last July.
Instead of taking up the time of the house to deal with election matters in the county of Gloucester, it would have been far better for my hon. friend had he undertaken to explain to the people in his county why he is supporting such a high tax on gasoline. If there is one county in the province of New Brunswick where gasoline is used to a very, very large extent it is the county that my hon. friend has the honour of representing in this house. And the fishermen of Northumberland are certainly not regarding with any great favour the imposition of this tax upon the gasoline which they are using in so many ways in carrying on their business and earning their daily bread.
It would have better suited the people of Northumberland county if my young friend had taken up the time of this house to discuss the question of the extra duty on tin plate. In the county of Northumberland and the other northern sections of New Brunswick, including the county of Westmorland, tin plate is used very extensively in the canning of fish. There reside in the county of my hon. friend two of the largest fish packers in the maritime provinces. Yet he had not one word of protest to make in this house against the imposition of the higher tax on tin plate. Why, if he thought of tin plate at all, did he not enter a protest not only against the imposition of that tax, but against the discrimination made in freight rates on tin plate from the Ojibway factory,-a factory established in the interests of the United States Steel Corporation-in favour of those centres in Ontario where fruit and vegetables are canned? The discrimination is against the maritime provinces. We are called upon today to pay 20 per cent more for the transportation of tin plate from Ojibway to the

273S
The Budget-Mr. Veniot

maritime provinces than for the transportation of the same article from Pittsburgh. Yet my hon. friend preferred to take up the time of this house in making his attack upon the member for Gloucester rather than demonstrate to the right hon. Minister of Finance (Mr. Bennett) the injustice that has been done to the people of the county that he represents and to the people of the county that I represent.


Mr. HANSON (York-Sunbury):: Would
the hon. member be good enough to tell us how long that condition has obtained?


Peter John Veniot: Within the last ten days.


Richard Burpee Hanson: He had
better go to the railway commission.


Peter John Veniot: It was not my place to go to the railway commission and attempt to influence them. I am now laying the matter before the house, and I would ask the right hon. Minister of Finance to take it up with the railway commission and see that this discrimination against the maritime provinces is discontinued.
There is another question that the hon. gentleman might have dealt with which is of immediate importance to the people of his county, and that is the sales tax on rope for fishing nets and lobsters traps. These articles were exempt in the past. To-day under this budget they no longer enjoy that exemption, yet the hon. member for Northumberland never raised his voice in protest. Before the introduction of the budget the sales tax on our fish goods was only one half per cent. Today salmon, sardines and other canned fish are subject to a sales tax of four per cent. Yet in this case too, the hon. gentleman coming from a county where a lot of this foodstuff is canned has not deigned to raise his voice in protest or to ask the government to look into the matter.
During his speech, in a voice filled with emotion, the hon. member asked this question: What has the Liberal government ever done for the maritime provinces? I regret, Mr. Speaker, that in his first speech in this house the hon. gentleman has displayed such a want of knowledge of the political history of his own province and of the maritimes generally. For his information, and for the information of other maritime members, permit me to place on Hansard a list of what the Liberal government has done for the maritime provinces.
It was under a Liberal government that the maritime provinces were given a 20 per

cent reduction in freight rates, which put into the pockets of the people no less a sum than about $3,000,000 a year.
It was under Liberal rule that the maritimes received two increases in provincial subsidy, one in 1907-and for the province of New Brunswick this meant $130,000 a year-and the other in 1928, the latter amounting, for the three maritime provinces, to about $1,500,000.
It was under Liberal rule that Prince Edward Island obtained additional transportation facilities, which have so greatly aided in the development of the resources of that island. And it was under Liberal rule that the present Minister of Railways (Mr. Manion) was enabled to enjoy a trip to Levis a few weeks ago to inspect the new ferry boat which the Liberal government put under construction to aid the people of Prince Edward Island.


Mr. SHORT:: Were not all these recommendations of the Duncan commission?


Peter John Veniot: No matter what they were, we gave them to the people of the maritime provinces. And let me observe that the hon gentleman opposed the Duncan commission when it was first proposed.
It was under Liberal rule that Nova Scotia and New Brunswick received for the first time a subvention to extend their coal trade further west; and this was in addition to the 20 per cent general reduction in freight rates already referred to.


Richard Burpee Hanson: Everything done under pressure.


Peter John Veniot: No, but in spite of the
opposition of hon. gentlemen opposite, who expressed the view that the appointment of the Duncan commission was a farce.


Harry Bernard Short: Because we knew what the
country wanted.


Peter John Veniot: Take your medicine. My
hon. friends do not like this. It was under Liberal rule that these things were accomplished. May I suggest, before I proceed, that if these hon. gentlemen cannot bear to hear these truths they are at liberty to go out.
It was under Liberal rule that the Nova Scotia coal industry received a bonus of 49 cents a ton on coal manufactured into coke for metallurgical purposes, which placed the Sydney steel industry on an equal footing with the Algoma steel works and the Canada Steel Corporation, who were receiving a drawback of 99 per cent on American coal which they were using for the same purposes. And

The Budget-Mr. Veniot
it was because of that subvention that certain members from the maritime provinces, notably from the Sydneys, voted against their own party and in favour of the Liberal policy in 1930.


An hon. MEMBER:: They were returned
in July.


Peter John Veniot: I know the shoe is pinching; hon. gentlemen cannot stand it. It was under Liberal rule-


Richard Burpee Hanson: Don't you worry.	[DOT]


Peter John Veniot: I am not worrying.


Harry Bernard Short: You seem to be; you are
labouring.


Peter John Veniot: I am not labouring; I am
stating facts and they do not appear to please hon. gentlemen. It was under Liberal rule that an additional 10 per cent preference was given on all British goods imported through Canadian ports, which action greatly aided the development of trade through the ports of St. John and Halifax, and practically shut out imports through Portland. Let me add that prior to the granting of this 10 per cent for the purpose of assisting maritime ports, large quantities of goods were imported from Great Britain into Canada through American ports, and within a year of the granting of that 10 per cent preference 991 per cent of all British goods came through the maritime ports and through the port of Montreal.
It was under Liberal rule that the harbours of Halifax and St. John were put under commission.
It was under Liberal rule that there was adopted a plan involving the expenditure of $11,000,000 to improve the port of St. John, and also a plan for the expenditure of large sums for improvements in the port of Halifax.
It was under Liberal rule that the great railway works were established in Moncton and the attempt was frustrated to have Moncton side tracked.
It was under Liberal rule that a line of steamships was established between the maritime provinces and the British West Indies, which has been so successful in increasing the business of the ports of St. John and Halifax.


Harry Bernard Short: Has it been a success financially?


Peter John Veniot: It will be if you give it
time. It was under Liberal rule that the Valley railroad was taken over and the province of New Brunswick relieved of a bonded indebtedness of $6,000,000.
It was under Liberal rule that the Kent Northern, the Albert Southern and the St. Martins railways were taken over by the Canadian National Railways in those sections, and the province given better service.
The Liberal government was the first to give special reduced freight rates on potatoes from the east to the west to open up a larger market for the potato growers of the maritime provinces. It was under Liberal rule that the subsidy was granted for the construction of coke plants to encourage the manufacture of coke from Canadian coal. A subvention or subsidy, whatever you choose to call it, was given of 4 per cent on the cost price of the plants wherever established in Canada. Besides that, in order to encourage further the manufacture of coke in the maritime provinces, the Liberal government gave a subvention of 5 per cent of the cost of any plants that might be erected by any municipality or city in the maritime provinces.
The hon. member for Northumberland also referred to the regulations recently adopted by the Department of Fisheries in connection with salmon fishing, and he intimated that I had attempted to take credit for any change made in these regulations. No man has ever heard my voice raised in this house or out of it at any time to take credit for anything I may have accomplished in that line. I was the first and only member from the province of New Brunswick to take the matter up in the house. I called the attention of the Minister of Fisheries (Mr. Rhodes) to what I knew was, and what my people represented to me to be, a grave injustice in the adoption of these new regulations. The minister was kind enough to say that a man would be sent to the province of New Brunswick to look further into the matter. It is true the deputy minister did go to the province, and he was accompanied, I understand, by the hon. member for Northumberland. While I am free to admit that the deputy minister would not in any way attempt to make politics out of the matter, I am convinced that the hon. member for Northumberland accompanied him with no other object in view than to make political capital and try to show the people he was doing something for them.


Richard Burpee Hanson: Of course you would not do anything like that.


Peter John Veniot: I should have to live in
York-Sunbury, represented by my hon. friend, to learn how to do that. He knows the trick so well that it is proverbial with all politicians in the county of York.
The Budget-Mr. Veniot

Now let me say that upon the return of the deputy minister I was notified that certain changes had been made in the regulations against which I had protested on the floor of this house, but what did the hon. member for Northumberland accomplish? He accompanied the deputy minister, though whether he went beyond his own county I do not know. The deputy minister held meetings in Restigouche county, where the people of Gloucester, whom I have the honour to represent, went to meet him. He also had a meeting in Chatham and another in St. John. When the deputy minister came back he recommended new regulations, and what do we find? While most of the vicious regulations were cancelled and the old regulations put back in force, we find as I showed the house later on, that one of the changes wa^ worse than the regulation complained of; in other words, the remedy was worse than the disease. My hon. friend from Northumberland, if he is to claim credit for having accomplished this change, has my pity when he undertakes to explain to the people of the county which he represents this fisheries regulation to which I now refer.
Now, Mr. Speaker, having finished paying my compliments to the hon. member for Northumberland I wish to pay my compliments to the Minister of Fisheries before proceeding to discuss the budget. In order to be quite correct in what I am about to say I am going to quote from the speech of my hon. friend the minister as it appears in Hansard. He was referring to the tariff of 40 cents per ton on anthracite coal, and in his anxiety to placate the users of anthracite coal in Quebec and Ontario he made the following astounding statement:
I submit that that tax, which was held up as a burden placed upon the people of Ontario and Quebec, need not bg paid at all by the people of those provinces. In the first place, even if they buy anthracite coal, the treasury gets the benefit of the tax. It remains to be seen, however, how much of that tax will be paid by the producer. I venture to say, owing to the highly competitive nature of the business. that the larger portion, if not the -whole of that tax. will be paid by the producer in the United States.
I do not hear any applause from the other side of the house.


Some hon. MEMBERS:: Is that not correct?


Peter John Veniot: That is just what I wanted; I set the trap and I caught my hon. friends. If the American producers are to absorb the duty on anthracite coal, where is the protection for the producers in Nova Scotia? Will my hon. friends answer that? Where is the protection for the coal miners in the
fMr. Veniot.]
province of Nova Scotia? On the other hand what do we find? We have the hon. member for Pictou (Mr. Cantley) standing up almost immediately after the Minister of Fisheries concluded and saying to this house-


Mr. CANTLEY:: You can depend upon what he said.


Peter John Veniot: His statement now is not consistent with his statement last year on the floor of this house. Last year he claimed that there should be a duty of at least SI .50 per ton on coal imported into Canada; he insisted upon that in season and out of season, whenever he spoke in this house. He blamed the Liberals because they would not put on a duty of SI AO against coal imported into Canada, yet now he comes to this house and says he is not quite satisfied with the budget in relation to coal, and warns the people that a larger increase must be given later on. I wonder why the hon. gentleman is willing to accept a slight increase to-day when, in the time of Liberal rule, he was demanding $1.50 per ton and saying that if this protection were not given the whole industry in Nova Scotia would be ruined. That is the inconsistency on the part of the hon. gentleman to which I wish to refer. He said further, "I want to warn the people of Ontario and Quebec that we are not satisfied with that 40 cents per ton on anthracite coal." Let my hon. friend take the minister from his province aside and whisper into his ear; let my hon. friend consult with the minister from his province and then perhaps we will be in a position to choose between the two. Who is right, the hon. member for Pictou, who says the duty must be $1.50 per ton, or the Minister of Fisheries, who says the 40 cents per ton will be absorbed by the American producers and therefore will be of no protective benefit to the miners of the province of Nova Scotia? That is the sort of thing we hear from hon. gentlemen opposite. They cried aloud for high protection on coal when the Liberals were in power, but to-day when their own party is in power they are satisfied with a small minimum increase in protection. It all depends, Mr. Speaker, upon whose ox is gored.
One of the other things to which I should like to direct the attention of the house is the statement, made by the Prime Minister during the session last September, that the additional duty then imposed would not mean an increase in price to the consumer. I hold in my hand evidence that that statement is not founded on fact. If the Prime Minister was given such a guarantee, then those who gave it did not carry out their engagement.

The Budget-Mr. Veniot
In order to prove what I say, I will give an illustration. I hold in my hand an invoice from a firm manufacturing rubber stamps and other rubber goods in the city of Toronto, Charles W. Mack. Written across the face of this invoice, in fact printed across the face, are these words:
Increase in price due to change in tariff.
Does anyone need further positive evidence?


Mr. SPENCE:: They only make rubber stamps and nothing else.


Peter John Veniot: That is what you should have placed over you. I am sorry the onion member, or rather I should say the representative of onions in the province of Ontario, is not in the house. This would be interesting to him.


James Houston Spence: May I ask what is the amount of that invoice? I suppose it is about $2.50.


Peter John Veniot: Since my hon. friend has guessed at it we will leave it at that, though he is far astray. I have here a circular from the Ontario Onion Growers' Cooperative, dated October 10, 1930, addressed to the trade. This is onion bulletin No. 5, in which they say:
In the belief that Ontario was 'possibly affected more by the present industrial depression than the other provinces, we voluntarily reduced our prices on October 2nd, from 10 cents to 25 cents per bag.
Any applause?
I say voluntarily because, on October 1st, the^ anti-dumping act became effective on onions, giving us a protection against imported onions greater than our f.o.b. quotation. Internally we have no competition.
No wonder.
British Columbia market is firm at a higher f.o.b. price than ours, and it looks as if we have to supply part of the prairie market. Enough said.
Then the circular proceeds:
Don't complain a couple of weeks from now that you couldn't see any possibility of higher prices for onions.
Let me inform the house that onions increased in price from that date. They predicted it; their prediction was borne out, because in November, 1930, onions were selling at $2 per 100 pounds, while in May, 1931, they were selling at $2.36 per 100 pounds.
Let me now deal with the matter of corsets, a subject which is interesting to the ladies of whom I see a number in the gallery. This circular which I hold in my hand reads
In view of the recent upward revisions of the tariff announced by the dominion government, we think that it is only right and proper
that we should remind you that our prices are "subject to change without notice," and as these revisions will undoubtedly increase the manufacturing costs of many lines, it is highly probable that advanced prices may have to be announced in the near future.
This letter is not written with the intention of crying "wolf, wolf," but we feel that it is only fair that our customers should know just what has been happening. Practically all lines of textiles and other supplies used in the manufacture of corsets have been affected by the increases in duty just announced, and this must in time be reflected in increased prices of manufactured goods.
This is from the Woolnough Corsetiers of Toronto.


Harry Bernard Short: Who prepared that statement for the hon. member?


Peter John Veniot: Nobody prepared it for me. This is the original circular signed by the firm itself, per F. M. Kay. And I want to say to the hon. gentleman that if he would take as great care in the preparation of his speech as I do in regard to mine, he would get along better.
I wish now to call the attention of the Prime Minister, who is also acting as Minister of Finance, to what I consider an injustice to the fishermen of the maritime provinces in connection with the changes in the tariff. Some years ago, in order to encourage the putting up of kippered herring in the maritime provinces, the then government imposed a specific duty in addition to the ad valorem duty on this commodity. If the present government believe it is necessary to have protection to encourage our industries, how is it that they have removed the specific duty on kippered herring put up in the maritime provinces? After the additional protection was afforded some three or four years ago, large sums of money were expended in preparation for putting up this foodstuff, but to-day that specific duty is removed and foreign countries are permitted to offer keen competition in the market that we have for kippered herring.
The Prime Minister, in his budget speech, referred to a large number, eighty-seven in all, of new industries established in the Dominion of Canada. Among that number he mentioned two in the province of New Brunswick. One of those to which he referred is established in the city of St. John, A. W. Higgins Company, a United States company manufacturing fertilizers. This company does not manufacture fertilizers; it imports the ingredients and mixes them. This company was established in 1928 in the city of St. John, and although established in that year in competition with the cooperative farmers who import the ingredients and mix them themselves, it employs only three or four men
The Budget-Mr. Veniot

during the summer time, and about fifteen or twenty during the winter season. According to the Prime Minister the other company is the Summers Fertilizer Company, Incorporated, which is established at St. Stephen, New Brunswick. At the present moment they are employing only four men. In the winter time they employ fifteen or twenty. They do not manufacture; they merely mix fertilizers. These are some of the great factories that have been established.


Richard Burpee Hanson: I suppose the hon. gentleman knows that his government closed up a plant at St. Stephen?


Peter John Veniot: 
Mr. W. W. KENNEDY (Winnipeg South Centre):: To traverse the budget debate at this late stage in my opinion can avail but little, and it is not my intention to do it. I tjhink this is clear to us all, that the subamendment as proposed by the independent group in this house will receive their unanimous support. It is equally true that the amendment as proposed by the official opposition will be supported by them; we can also assume that the main motion introduced by the government will receive the support of government supporters in this house, and that it will be adopted. That being so, I wish to pass on to three matters which to my mind are of special interest.
The first is a matter of immediate and acute concern. I refer to a matter which already on many occasions has been the subject of discussion in the house, namely, unemployment as existing in Canada to-day and the measures

The Budget-Mr. Kennedy (Winnipeg)
or means by which some remedy may be furnished. I represent, sir, in this house the riding of Winnipeg South Centre, a constituency which is in the heart of that great western city, the third city of Canada, a city in which the problem of unemployment is at present, a matter of immediate and outstanding concern. I wish to approach this question not in any disputatious way, because I think no good can be served by that. I should like first to clear the ground a little.
First I say this question of unemployment is a matter of national concern. That will not be disputed. It is a matter that the people of Canada expect this government to deal with. It is a matter that the people of Canada have a right to expect this government to deal with, and I believe that this government will not disappoint the people of Canada in that regard.
Much has been said, and many words have been bandied across this floor as to just what the present administration during the last campaign promised to do. Many statements have been made, some correct, some partly correct, some greatly exaggerated and unfair. But this stands out. Just about one year ago the Conservative party recognized that the question of unemployment was then one of national concern. It recognizes that it is still a matter of national concern, and it was to the Conservative party on July 28th last that the people of Canada, rightly or wrongly, turned in this their hour of need. The party then, and the government now, has a trust to the Canadian people which I think they will recognize.
What is the situation? I am not going to go into statistics. Many are available, some correct, some incorrect, but this fact remains, that there is unemployment in this country to-day to an extent which calls for the attention of all governments, federal, provincial and municipal. As to whether unemployment is greater in the west now than it was a year ago I am not prepared to say. In some parts of the country certainly it has diminished; in other parts undoubtedly it is greater.
Who are these unemployed? You have witnessed, sir, as I did on May day last, parades of the unemployed. Who are they? I grant that among them there are some professional agitators and demagogues who serve no useful purpose to themselves or to this country. But, sir, there were also extremists watching them from the tall buildings as they paraded by. The number of those two classes of extremists, thank God, is relatively small. The rank and file, the great majority of those people are honest, decent Canadians, seeking what? Not coins in their hats, but
work. To afford those people that chance should be Canada's chief concern. Who will shoulder the burden? I shall not enter into any argument as to where the line should be drawn as between the federal, provincial and municipal authorities respecting jurisdiction in the matter of unemployment relief. Surely it is a job for them all. The principle has been recognized by both parties that once unemployment has reached the stage that it becomes a matter of national concern, there is imposed upon the federal government the duty of stepping in; and that is right. Take any centre you like. Take the city of Winnipeg, with the unemployed there last winter, as they are now, and as they will be, it is apprehended, this fall, and call the roll. Not by any means all citizens of Winnipeg, in the real sense of the word, but residents of Canada, who, in the very nature of things, drift into a large city where they think there is the greatest hope of relief. Already many of the municipalities which have been least able financially to stand the burden have reached their limit. The city of Winnipeg, I am informed,-I should like to be corrected if I am wrong-expended of its own money in the past year, for this purpose, nearly three-quarters of a million dollars. It behooves us then to consider the matter thoroughly and arrive at some basis upon which the difficulties which we will meet during the coming winter may be taken care of. The criticism may be offered, and in fact has been frequently made, that to declare such difficulties is not good advertising for any part of the country. But surely the way to solve a problem is first to face the facts. I do not wish to be quoted as indicating that I am unduly apprehensive or that the people of Winnipeg have become panicky, because that is not the fact. They have carried through this period of depression and they will continue to do so. I wish however to draw the attention of the house to the fact that people in centres such as Winnipeg and Vancouver expect that this matter will be dealt with. And I have no doubt whatever that it will be dealt with; I have every assurance in that respect.
Now, Mr. Speaker, what has been done? The right hon. leader of the opposition, at the conclusion of the marathon speech he delivered yesterday, referring to unemployment, made the following statement:
The ministry have done nothing to meet the present situation.
When a member who has sat as long in the
house as my right hon. friend, particularly one who occupies a position as import-
2744	COMMONS
The Budget-Mr. Kennedy (Winnipeg)
ant as that occupied by the leader of the opposition, makes a statement of that sort, I ask to what extent he is contributing to the solution of the difficulties to which he refers. Nothing at all. The right hon. gentleman talks about harmony, cooperation and unity. If ever in the history of Canada we needed unity and harmony and cooperation to solve our problems, now is the time. I might speak in stronger terms, but I shall have to be content by saying that exaggerated statements such as that made to the house yesterday by the leader of the opposition contribute nothing to the solution of a question as vital as the one now before us.
Hon. members will recall that among the pledges made during the campaign there was one to shut off immigration until our own workless weTe employed. Has that not been done? I am indebted to the hon. member for Dauphin (Mr. Bowman) for placing on Hansard the other night certain figures. Comparing the figures for the year 1930-31 with those for the year 1929-30 we see substantial decreases in immigration. For the information of hon. members I shall repeat the figures given to the house by the hon. member for Dauphin:
	Decrease
Months	per cent
September		.... 47
October		.... 50
November		.... 55
December		.. .. 58
January		.... 56
February		.... 64
March		.... 83
April		.... 83


Robert James Manion: Those are decreases as
compared with corresponding months in the previous year?


Mr. KENNEDY (Winnipeg):: Yes. To
the end of last month, the month of May, approval had been given to expenditures amounting to $70,660,250 for works to relieve unemployment. Those contracts were undertaken through the special measure introduced into this house by the present government at the special session held in September last Since the introduction of the Unemployment Relief Act, 291,735 men have been given employment under its provisions on works financed by the dominion, provincial and municipal governments. In addition direct relief has been provided in many cases. The distribution of the expenditures made is set out in a Canadian press despatch dated at Ottawa, June 14. However as my time is limited I shall ask the indulgence of the house to have this newspaper despatch placed on Hansard.


Some hon. MEMBERS:: No, no.
iMr. W. W. Kennedv.]


Pierre Édouard Blondin: Unless the hon. member
chooses to read the document before him it cannot, without unanimous consent, be inserted in Hansard. As I hear objections, the hon. member will have to read the article if he wishes to have it appear on Hansard.


Donald MacBeth Kennedy: Very well,
I shall read it. It is as follows:
Up to June 10, Hon. G. D. Robertson, Minister of Labour, had approved of expenditures totalling $70,660,250 for unemployment relief works to be carried out under the joint scheme. Details of the distribution of the works follow:
Then follows the distribution in dollars and cents for the different provinces, and the despatch continues:
The provinces, railway companies and departments of the government cooperating under the Unemployment Relief Act of 1930, have fur-nised statistics showing the following actual volume of employment given to individuals, and number of man-days' work given up to May 31, 1931.
Then follow the figures. The right hon. leader of the opposition derides this relief and says nothing has been done. I ask hon. members to compare what the present government has actually done with what the right hon. leader of the opposition was willing to do less than one year ago. What he was willing to do needs no repetition by me; his actions are known to this house and to the electors of Canada. Yesterday the right hon. gentleman asked: "Where is Senator Robertson, the Minister of Labour? Why is he not here?'' Let me suggest that the Minister of Labour in going through the western country, visiting the principal centres of employment, interviewing chief civic officials, getting in touch with labour and municipal organizations, carrying out a survey such as that throughout Canada, is rendering a service immeasurably more valuable than if he had listened to the four-hour speech of my right hon. friend. I make this statement without any disrespect whatever for the right hon. gentleman.
The right hon. leader of the opposition has referred to conferences. This house and the people of Canada expect deeds, not mere words. If there is any outstanding characteristic of the present government it is that it acts rather than talks. What is to be gained by such criticism as that lodged yesterday by the leader of the opposition? As a new member I found myself wondering why, after so many years of parliamentary experience, an hon. member would spend four hours flailing threshed straw. What purpose could be served? I may be wrong, but the thought occurred to me that the right hon. leader of

The Budget-Mr. Kennedy (Winnipeg)
the opposition is so completely obsessed with the idea that he was born to rule that he is unhappy every minute he finds himself sitting on the opposite side of the house. For over three hours the right hon. gentleman criticized. I do not wish to be disrespectful, but for the want of a word which may be somewhat more parliamentary I would describe his criticism as three hours of "pooh-bah." He seems to forget that most of the matters with which he was dealing are of the past. This is the present; to-morrow is dawning; it is tomorrow with which we should be dealing.
In closing my discussion of unemployment, I make the following suggestions, Mr. Speaker. First, I suggest that there be made a complete survey-this I believe is being done already and has proceeded a considerable way-of the actual conditions as to unemployment existing in this country to-day and, as is apprehended, will exist when the winter approaches. Knowing those conditions, then adequate steps can be taken to deal with them. The right hon. leader of the opposition suggested a conference-not an unreasonable suggestion. Certainly conferences are being held now by the Minister of Labour with those who are in direct contact with unemployment conditions in various parts of the country. If in addition to that it be essential, as it probably will be, to meet with the provinces to work out the basis of a solution, then it is fitting that such a conference should be held in ample time to take action before the winter season is on us. What will be done is not for me to say, as I do not know; but it does seem to me that something should be done along the lines on which the government has already proceeded, namely, the initiation of a vigorous policy of construction of public works, such as highways, public buildings, and other federal undertakings at present needed. And it is not too much to expect that to create employment we shall have to anticipate to some extent the needs of the future. For that purpose it is obvious that revenues will not meet such a program, and I suggest that a federal loan be floated. I have no doubt that the people of Canada would subscribe enthusiastically to such a loan. The moneys thus raised could be expended not by way of doles, but in the construction of needed public works. This would not be wasteful expenditure, but a wise investment. It would enable us to tide over this period of unemployment until better times come, and we all hope that they are fast approaching. Such a proposal, Mr. Speaker, is not unfair. We of to-day are
carrying the burdens of yesterday. Is it too much to ask that the generation of to-morrow lend a helping hand?


Some hon. MEMBERS:: No.


Donald MacBeth Kennedy: May I make one personal reference? I understand that my hon. friend from Winnipeg North Centre (Mr. Woodsworth) is to follow me. During the July campaign in the city of Winnipeg there was displayed on one of the windows of my committee room this slogan: "Kill the spectre of unemployment!" Now, my opponent spent a good deal of time talking about that slogan. I understand that my hon. friend from Winnipeg North Centre (Mr. Woodsworth) also took a crack at it, speaking over the radio at Brandon. I did not mind that a)t all, but the argument pursued by them was that unemployment is a world wide condition; so how could any party in Canada hope to cure it- how could Canada do anything to kill the spectre of unemployment? By way of reply just let me use one illustration. Our concern is " Canada first." I know it is very fine to look upon the world as a brotherhood and to say that we must not raise the tariff here because if it builds up Canadian industry it will throw brother workmen out of employment in Japan, Russia or somewhere else. But I am not unselfish to that extent. I conceive it my duty as representing a Canadian constituency to work for Canada first, to build up industry here; if it gives employment to Canadian workmen at the expense of workmen in Japan or Russia or elsewhere, still my duty is to Canada. Now if the policy which this government is pursuing as to building up industry in this country, as to working up our raw material in Canadian factories by Canadian workmen, creates additional employment, as we have ample evidence it does, then I say this: Every head of a Canadian family who is out of employment and in destitution, is downhearted and depressed and hopeless, when he gets a job in one of these factories and at the end of the first week comes home with his pay envelope, as he gathers around the table that night with his little family of six or seven, assured of steady work-I say that in each such case you drive out of the eyes of that family the look of depression and despair, and place there instead the light of hope. In a word, for them you banish the spectre of unemployment, that is something worth while. Multiply that case a hundredfold or a thousandfold, and surely it is something worth trying to do, surely it is
2746	COMMONS
The Budget-Mr. Kennedy (Winnipeg)
something that deserves better than the gibe3 and jeers of those who claim they are the sole representatives of labour in this country.
In the few minutes left at my disposal I wish to refer very briefly to two matters, the first of which is pensions. I was indeed pleased to see that the budget provides for implementing the engagement relative to old age pensions as a national obligation by increasing the federal grant from 50 to 75 per cent. But hon. members opposite say, "You promised to make it 100 per cent." Well, this government has been in power only ten months, and already it is performing 50 per cent of that obligation. That is moving along in the right direction, that is a good example. I was further delighted to hear the hon. Minister of Fisheries (Mr. Rhodes) state last Monday that he looked forward in the very near future to the promise being implemented to the full 100 per cent.
In connection with the federal scheme for old age pensions I wish to urge another matter. I know it is not touched on in the budget, but I think now is the proper time to bring it to the attention of the house. Distributed throughout this country there are approximately 8,000 sightless people. The matter of pensions for the blind has long been discussed. I know that it may be urged that we are overburdened with pensions, but once you establish the principle of age disability, it needs no stretch of the imagination to bring under the same principle those who suffer through the disability of blindness.


Some hon. MEMBERS:: Hear, hear.


Donald MacBeth Kennedy: 
Mr. J. S. WOODSWORTH (Winnipeg North Centre):: As a resident in and an elector of the constituency of the hon. member who has just spoken, my bon. friend from Winnipeg South Centre (Mr. Kennedy), I may be permitted to compliment him on the speech which he has delivered. Indeed, I feel thankful that he has made such an earnest presentation of a number of the problems Which we in Winnipeg are feeling very keenly, perhaps especially that of unemployment. I should also like to associate myself with him in his plea for the blind people; possibly they may be included under the new old age pensions scheme. I agree also that in some way or another the machinery which is administering the pension legislation of Canada should be speeded up or replaced by better machinery in order that relief may be given mo-re promptly.
There was a reference made by the last speaker to the gibes and jeers of those who claim that they are the sole representatives of labour. I presume that statement referred to the members in this corner of the house, though I have never claimed, nor has any one of -us, that we were the sole representatives of labour. We simply state that we are representing labour; that labour is to-day a distinct political group, and that we were definitely elected on the nomination of the labour party. It seems to me the reference was a little gratuitous.
However, I am not going into that to-night. I was very glad the last speaker recognized the seriousness of the unemployment situation. He suggested that there should be a careful survey, and also that conferences should be held in ample time. I wonder whether he saw the despatch from Victoria which came
The Budget-Mr. Woodsworth

to us two days ago, stating that Senator Robertson had declared that a dominion-provincial summer conference was not advisable. That seems bo me a most deplorable statement. Those of us who come from the west at least, who for the last year have been feeling the full pressure of unemployment, had hoped that there would be a conference between the dominion and the provinces in order that arrangements could be made in the very near future. I am greatly disappointed that there should have come an announcement of this kind, and I hope the government will reconsider the decision. Only a few days ago since another despatch brought word to us that troops actually had been sent to Edmonton in order to be on hand in case of riots which were threatened. It is also true, as we all know, that unemployment is very severe right across the country.
Only a few days ago the Minister of Immigration (Mr. Gordon), in response to a question by the hon. member for Comox-Alberni (Mr. Neill), made this statement:
Mr. Speaker, the situation referred to by the hon. member for Comox-Alberni (Mr. Neill) is, as no doubt the house understands, purely a provincial matter. If it is found that the municipal and provincial authorities cannot relieve the situation, there is no doubt that proper steps will be taken, and taken without delay, by this government to assist.
Those are almost the exact words used again and again by the Prime Minister of the last administration.
M.r. KENNEDY (Winnipeg): Except that he did not do anything.


James Shaver Woodsworth: That may be tTue, but the fact is that although we give the present administration full credit for having called a special session of parliament; although we gave them that credit at the time and have done so since, still we have serious unemployment. In view of the acute situation it seems to me that immediate action ought to be taken. I do not want to refer to the past too much, but after all the government is the responsible body. Just a year ago the Prime Minister, speaking in Calgary, was reported in the Calgary Herald of June 13 as having said:
This is a new country and there is no excuse for unemployment in Canada if a government does its duty.
That is all I want to say; there is no excuse for unemployment in Canada if a government does its duty. The Prime Minister went on:
I am convinced this unemployment has now ceased to be local and provincial and has
[Mr. Woodsworth.1
become national in its importance. It has reached far beyond the narrow confines of Calgary or Alberta and is stretching into the broad confines of our dominion.
I think the hon. member for Winnipeg South Centre will quite agree with that statement, as I myself agree with it, but I find that the Acting Minister of Labour attempts to get out of the responsibility for existing unemployment by saying it is primarily a municipal matter. Again, speaking at Woodstock on June 26 of last year, the present Prime Minister, as reported by the Toronto Mail and Empire, said:
We must pass laws at the special session that will anticipate work for our people on national highways, on great canals that we must make for our waterways to the sea, in great undertakings such as branch lines and matters of that kind in order that we may give employment to our people.
All I want is action. But, Mr. Speaker, there is one thing to which I must refer tonight, and that is the demoralizing effect upon the unemployed of these long periods when they have to subsist largely through charity. Only a few days ago I had a letter from a friend of mine, a lady now resident in Ontario, who wrote with regard to an immigrant boy. I will read a paragraph, since though this refers to a special case it is typical of a great many cases:
Late last fall a neighbour of my sister's picked up a boy who had no work nor any money, so he took him home, paid him for some farm work and then, winter setting in, told him he could keep him for the winter but with no pay. This was to be his second winter of farm labour with no pay. During the winter he came to my sister's house-as she had an immigrant boy-together they built birdhouses in the evening and the family here played games with them. My sister says a nicer boy would have been hard to find. In February he left with another immigrant boy to find work. Nothing more was heard from the lad until about a month ago-ha came back. In the meantime he has travelled on the freight trains back and forth twice to Halifax hoping to get back home.
That is to the old country.
During this time he has been sleeping in jails, eating in soup kitchens and been chased from town to town by the police. It would not be hard to know the result of all this- he is here with my sister. She has taken him on for a month, but feels she can't do more than this. But what of the boy as a result of his two years in Canada? He has lost his selfrespect, changed from a dapper lad to a tramp in appearance. He has lost his respect for everything sacred, entirely embittered and discouraged, the makings I would say of a criminal if allowed to drift back into the tramp life again.
She makes a plea that he might be deported, and that if possible more boys

The Budget-Mr. Woodsworth
be prevented from emigrating to this country. I would call upon the members of this house, who are not without human sympathy, to think over the serious demoralization which is taking place in the cases of so many thousands of our people, which inevitably will drive them into crime.
The amendment to the amendment, in urging immediate action, refers to the crisis in 1914. At that time the government of Canada passed a law that bank notes no longer should need to be redeemed in gold. They took that action at that time in the interests of the banks, lest there should be a run on the banks. The amendment asks that something of this character should be done now in the interests of the people at large. That is the meaning of the anti-deflation proposal. I for one-and possibly I may differ from some other members of this group never have believed that money reform was a cure-all, but I would urge that it would at least temporarily help the producers. Further than that-and this appeals to me-it would relieve the burden of unjust debts.
An economist, a friend of mine, wrote me the other day with regard to this proposal as follows:
A higher internal price level would lower the real burden of all payments of interest, and other contractual payments made in Canadian dollars, whether they were interest on the national debt, on railroad or industrial bonds or stocks, or on bank loans, mortgages, or rents, royalties, or taxes.
It may be objected that while such a change benefits debtors, it is at the expense of creditors.
This is true.
But it simply involves putting creditors back to their position in the years prior to 1929, when the relations of debtors and creditors were considered satisfactory, and permitted an unprecedented prosperity for most producers. There is no reason to believe that the mishap of the recent deflation brings with it any natural justice, any more than the mishap of an epidemic does. A return to the price level of 1922-29 would be a restoration of justice, not a departure from it.


Mr. PECK:: The hon. member did not
mention the gentleman's name.


James Shaver Woodsworth: No; it was a friend of mine.


Edward Armour Peck: Will the hon. member be kind enough to give the name?


James Shaver Woodsworth: No, but I shall be glad to give that of another one-whose authority will not be questioned. What I have given was written by a friend of mine, an economist, who summarized very capably the position.


Edward Armour Peck: I should like to know the
name.


James Shaver Woodsworth: I am not giving
the name. I am giving his statement merely as a summary, not as an authority. The other day, only on June 13, Sir Basil Blackett, who is well known as a director of the Bank of England, apparently, according to a press dispatch, comes to the support of this amendment, because he insists that there must be drastic reorganization of the world's currency system. In his view the way to keep currency sound is to ensure that at all times its volume be neither too great nor too small for the world's needs, but regulated so as to keep prices stable.
Not only is this director of the Bank of England thinking along this line, but I might call attention to a well known monthly letter published by the Royal Bank of Canada. Let me quote a paragraph or so from the June number. This follows a careful study of the volume of production:
This relationship between volume of production and trade and volume of credit is one of the most important discoveries which has ever been made by the statistician. It implies that there is a mathematical relationship between volume of production and credit on the one hand, and the price level on the other. In fact, by dividing each given volume of credit by the corresponding volume of production, the level of prices at any particular moment is approximated.
Again:
The accuracy with which the line showing the theoretical price level corresponds to the actual price level is, in itself, a remarkable verification of the quantity theory of money.
Again:
When volume of credit is increased more rapidly than production, prices rise; when production increases more rapidly than volume of credit, prices fall.
This is his conclusion:
What is the inference to be drawn from the facts which we have outlined? Can it be that had the growth of credit paralleled the increase in volume of production and trade there would have been no substantial changes in the general price level, no major business cycles, no booms, no severe depression? This is indeed a startling concept, affording hope that the social injustices inherent in all major changes in the general price level might be avoided by proper control of credit. This is surely a counsel of perfection not fully attainable in human affairs, but it is clearly within the power of the great central banks, through appropriate interest rates and open market policies, to control within reasonable limits too rapid increase in the volume of credit and also to prevent contraction of the normal growth of credit, which is the basis of the present world tragedy.
It seems to me when eminent authorities are thinking along these lines, it is well that we in
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this house should give greater attention to the matter, so I have no hesitation in voting for the subamendment which suggests a certain measure of inflation. I like to think of it as anti-deflation. It is but putting us back where we were when most of our debts were contracted. I wonder if I might read a little rhymed prose, as he calls it, which was recently published by Sir Thomas White, originally in the Morning Post. It refers particularly to conditions in the United States, although it is becoming true very rapidly of the class that in Canada to-day controls wealth:
Gold, gold, gold, gold!
Here I sit with wealth untold;
Gold in hand and gold in store,
Vaults and coffers flowing o'er;
Gold in coin and gold in bar,
Gold from near and gold from far,
Gained in peace and gained in war,
Gold, gold, gold, gold.
Here I sit with wealth untold.
They bought our goods, we have their gold, But though I sit with wealth untold,
I am unhappy, for behold-
My people suffer sore distress,
Hunger and want and wretchedness,
And languish in their idleness.
Their hands no longer train the vine,
They cannot sell their corn and wine,
The merchants buy from us no more,
For we have all their golden store,
Their gold, gold, gold, gold!
And here I sit with wealth untold.
There is another stanza, but I shall not read more. That was written by Sir Thomas White simply, as he says, to emphasize the situation in which the United States finds itself to-day and which exists to a very considerable extent for certain classes in Canada who imagine they can continue to pile up dividends at a time when the people cannot buy what has already been produced.
The subamendment goes further than this concrete suggestion, and I am particularly interested in the wider statements of the subamendment. Our amendment goes so far as to advocate a new economic system based on cooperative principles, not on competition, involving the mobilization of our natural resources, technical equipment and financial machinery to provide for the needs of the people. I know this seems heretical to many hon. members. We have been accustomed to deride socialism so that when a socialistic amendment of this kind is put forward, people look askance at it. Yet I would point out that various important bodies are coming very near to the lines of the subamendment. The other night I referred in passing to the pope's encyclical recently published. What does it say? As the hon. member for Labelle (Mr. Bourassa) pointed out the other night, certain 
parts are being emphasized; others are not being stressed so much. The encyclical, as summarized by the Toronto Star of June 12, states:
The present economic life is hard, cruel and relentless in ghastly measure. Two evils arise from modern industrialism: one is an economic abasement of the workman; the other is moral degradation of both employers and employees.
Free competition permits the survival only of those who are strongest, which often means those who fight most relentlessly, who pay the least heed to the dictates of conscience.
There are vast differences between the few who hold excessive wealth and the many who live in destitution. Every effort, therefore, must be made that a just share only of the fruits of production be permitted to accumulate in the hands of the wealthy and that an ample sufficiency be supplied to the workingman.
Unemployment is a dreadful scourge. Social justice demands that reforms be introduced without delay which will guarantee every adult working man a sufficient wage.
That is what we have been asking for in this house for years, and yet that is a condition which seems to be yet far off in the future. Recently there have been held conferences of the United church, which I understand is one of the largest Protestant bodies in this country. The other day the Toronto conference passed this resolution:
That this conference is convinced that the present distressful and obstinately threatening economic situation calls for an even more comprehensive organization of the human and economic resources of the dominion than was imperative in the war.
Almost the very words that we are using in our amendment, pointing out as we do that we have a crisis to-day as severe as that which existed in 1914. The resolution goes on:
We therefore urge that the federal government at the very earliest hour availing itself by commission or otherwise of the ablest and most experienced representatives of agriculture, industry, labour and finance, and of acknowledged experts in economic sciences, should devise a national plan which would direct and organize the total man power and the money power of the dominion, which will find work for the workless, kindle hope in the despondent and bitter, and guide our country into a closer union than we have ever known.
Again, almost the words that are used in our amendment when we urge that there should be a central plan in order that we may more fully and efficiently mobilize the forces of production and distribution in this country.
Perhaps the most radical of all the resolutions passed by the United church was that passed by the Alberta conference. I wish the Prime Minister were present, because I

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think he is in very close touch with the Alberta conference of the United church. I read a few sentences:
We should proceed as rapidly as possible to the creation of an order based on cooperation and service which would displace the present competitive acquisitive social order.	[DOT]
Again:
Up to the present the central feature of the economic situation is profit.
Again:
The present system has now been under trial for a sufficient period to lend itself to fair criticism and the present unhappy conditions of over-producton, unemployment and attendant uncertainties is its condemnation.
Here we have this church body definitely condemning the present economic system under which we are living. The resolution goes on:
We believe that society should regard forced unemployment as an intolerable menace producing an unemployable class, with slum conditions, wastage of human energy and personality and threatening war or revolution. Governments should grapple with this problem with energy similar to that which would be used in a national emergency.
I have taken the time to read these resolutions in order that the house may become aware that there is a large body of thoughtful opinion outside this house which is very much dissatisfied with the existing economic system and is looking forward to some very radical changes.
Socialism, which is the word most commonly used to describe a new system of which many dream, has often been misunderstood and misinterpreted. May I take a few minutes to show the viewpoint of those who hold this doctrine of socialism which distinguishes some of us alike from the older parties, the Conservatives and the Liberals.
In the earlier days, prior to 150 years ago, each individual workman produced with his own hands a few simple things which he needed for himself, or which he exchanged with others about him. Then came the introduction of power machinery, and on top of that the organization of industry. This process has gone on and on and on until we have to-day the present highly organized system of production and distribution which has spread throughout the world. When the machine came into existence, if the workers themselves could have owned the machine, if the machine itself could have been used in the interests of the community, I think we would have been saved all these difficulties which we now face. But unfortunately the machine became the property of an individual
or of a few individuals; and as these machines have multiplied, as the organization has gone on, we have found that a few individuals or a few great corporations practically control the major part of the productive and distributional machinery that we require today to supply our needs. That development has been accompanied by an entire lack of any social responsibility on the part of those in control. The people who control the machine, and the people who control the organization, the people who control the banks, the railways and the big factories, think that they are justified in running these things in their own interests, without any immediate responsibility to their employees or to the public at large. That, it seems to me, is where the weakness of the present system manifests itself, and some of us would claim that under these circumstances we must so change the system that this great organization will in some way come under collective control, will in some way come under the administration of the people themselves, and will be used not merely to pile up profits for a few but used rather in the interests of the great majority of the people. That is what we call socialism. Socialism, so understood, is not such a very long way from what is adumbrated in the application of the principles enunciated in the pope's encyclical- even though the pope may denounce "socialism." I take it that that is exactly what is meant by those who put forward those resolutions of the United church, even though those who did so may not be followed by the great body of the people of the United church.
One trouble with the present system is that there has been an extension of the idea of private property to cover corporate property. Private property is something that I own for myself, something personal. That was the original idea of the word "proprius"-something of my 'own, a personal thing, but we have extended the meaning until great corporations now claim as their own vast banks and other institutions, and claim them without any responsibility to the public. I submit that this extended idea of property must be challenged, and changed in the interests of those who want to have a tiny bit of property for themselves.
As my hon. friend from Wetaskiwin (Mr. Irvine) said this af-ternon, tihe great question which is under discussion in labour circles is this: Will this change in the system be brought in by evolution, by a gradual process, or by a revolution? In Russia it was brought in by
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revolution following the disasters consequent upon the war. What is going to happen in this country? A good many of us have dreamed that tihese changes could be brought in by gradual steps, but one begins to doubt this. An editor in the west remarked the other day that an explosion does not come gradually. If we allow distress to go on unrelieved, if we allow resentment bo be pent up in the minds of large numbers of people, then sooner or later in this country as in other countries we shall have an explosion. As my hon. friend from Labelle pointed out so clearly the other night, that has been the result throughout history. It is for us to decide by which means we are to bring about the necessary changes.
I have always urged that we use our brains instead of leaving matters until riots force us to take action. I still think there is a possibility of using our brains and yet, as I have watched the action of those in authority this year, not merely the government but those who stand behind the government, the great manufacturing bodies, the banks and the like, those who are really in control, I have wondered whether it is indeed possible that these changes may come gradually. When we propose even a comparatively small change, for instance the lessening of the rate of interest,-to say nothing about sweeping away interest-immediately the whole of the financial fraternity is up in arms. When we propose the lessening of taxes on the necessities of life used by the ordinary people, again we find decided opposition. If as was done at a United church conference the other day, we in this house proposed a moratorium in order that working people would not lose their homes, and that farmers would not be forced to abandon their farms, I know that in this house to-night there would be steady opposition. Indeed hon. members on the government side of the house would be up on their feet in a moment and protest that I was alarming the investors of the country and thus doing irreparable damage. As soon as we make these suggestions involving small changes we meet with opposition. How then can we hope that these gentlemen will consent to the establishment of a new social order?
In the amendment to the amendment there is a suggestion that there should be a scaling down of debts. When I referred to that particular question in my speech on the address in reply I framed my suggestion in that way. My hon. friend from Macleod (Mr. Coote) offered the same suggestion in more exact terms when he outlined the measure of inflation. The proposal is that the people who

to-day are holding bonds and mortgages of various kinds should receive interest and final repayment on the basis of the value of the dollar at the time those debts were contracted. To my mind that is not at all unreasonable. Immediately however there is the cry of confiscation. Even the right hon. leader of the opposition, from whom we might have expected some support, told us that to experiment along those lines at a time like this is very, very serious. I suggest that if we cannot secure these minor reforms such as help for the farmer by a reduction of freight rates, even though that reduction involves an additional burden upon the rest of the community-if we cannot secure help for the unemployed, even though we have to tax the rest of the people more heavily in order to keep those unemployed; if we cannot obtain some relief for the debtor class in the form of deflation or scaling down of debts or whatever form such relief may take without immediate protest, 1 say to those in authority that they are simply piling up trouble for themselves in days to come. I do not believe the people in this country are going to stand very much more. I do not think they are going to stand very much more-


An hon. MEMBER:: Right.


James Shaver Woodsworth: My hon. friends sitting across the way who think they are supporting the government sneer at the suggestions I am making.
Those of us, however, who are living at all close to the people and who probably kpow a little bit more about conditions than some other hon. members, realize that the situation is serious. I repeat, the situation is serious.
In the few moments I have still at my disposal I want to make one more plea for the unemployed, because they seem to have so few people to plead for them. The other night my colleague referred to the fact that the city of Ottawa had driven the unemployed off the dump heap and that when they left there they had no place to go. I ask you, Mr. Speaker, what is there for men in that position to do? In the old days they had an outlet on the farms, but that outlet is closed. In the old days there was an outlet in the bush, but that outlet is closed. For two generations we had an outlet in western Canada, but that outlet is not only closed but the people are drifting back to the east from that country. In the old days we could send people from the cities to the country, If they went out to-day they would meet another army of unemployed coming back from the country to the city; that outlet is closed.

The Budget-Mr. Larue
What can these people do? They have been driven from our parks; they have been driven from our streets; they have been driven from our buildings, and in this city they actually took refuge on the garbage heaps.


An hon. MEMBER:: Go on.


James Shaver Woodsworth: Yes, seventy were driven off the garbage heap the other night.


Ian Alistair Mackenzie: Quite
right.


James Shaver Woodsworth: Yes, those are facts. There may have been some reasons of a sanitary nature for driving those men from the dump heaps, but my point is that this city has made no provision for these men, and the only alternatives left them /are starvation, begging, suicide or crime. Those, so far as I can see, are the only alternatives open to them, and I am not at all sure that we could hold them very guilty if they do not starve. That is the situation with which we are now confronted. I am not loading the whole responsibility upon this government, but I urge we have a right to look to the government to outline some plan. I disagree entirely with some hon. members who take the ground that we ought to allow this budget to pass or even let this session go by without taking decisive action. I should hope that the members of this parliament would not pass the budget until some definite statement is made by the government as to what they purpose to do in the present emergency.


Mr. HENRI LARUE (Matane) (Translation) :: Mr. Speaker, in addressing the house for the first time, may I congratulate you on your election to the speakership of the House of Commons, and on the dignity, impartiality and courtesy with which you discharge the duties of your high office. Imbued with the principles which guided the Fathers of Confederation in framing the Canadian constitution, making your own that thought expressed by Sir John A. Macdonald, that there is in this country no conquering race, no vanquished race, but two great races which, in harmony, bonne entente and on an equal footing, must work together in building the Canadian nation, with deference for the two official languages of the country, you had no hesitation in undertaking the arduous task of learning French and expressing yourself in that language in the discharge of the duties incumbent on you as Speaker of this house.
Permit me, sir, to congratulate the hon. member for Toronto Northeast (Mr. Baker) for the courtesy shown towards the French
Canadian race in expressing himself in our Mother tongue. Let me assure him of the gratitude of all my compartiots.
Why is it that at a time when the leading Canadian statesmen are working together to promote feelings of bonne entente between English and French speaking Canadians, why is it, sir, that the Anderson government has launched an unjust attack against the most sacred and cherished rights of French speaking Canadians, against the free teaching of French and religion in the schools of Saskatchewan? I deem it my duty to strongly protest on behalf of myself and constituents against the campaign of national disruption which is carried on in Saskatchewan, against the anti-national legislation put into force by the coalition government of Saskatchewan. The province of Quebec entered into a contract when she associated herself with the other provinces in order to form the Canadian Confederation, and with pride I can loudly proclaim that my province has never made any attempt against the rights of the minorities which she undertook to protect and maintain. Our legislators did not endeavour to seek law texts, and discover in conventions motives to attack the rights of minorities which they had agreed to respect. This question which refers .to the rights of French speaking Canadians should not be discussed on political platforms during an election. I think that public men of all political shades should unite on this most important question and rise above political prejudice in order to foster bonne entente and harmony between the two great races which united to form the Canadian nation.
Allow me, sir, to compliment the distinguished members of the Press Gallery;
I know that they are all proud of their fine profession, that they have the serious duty to enlighten the people on the legislation and questions which are discussed and solved in this house. I trust they will be indulgent for one who speaks for the first time in this chamber rendered so illustrious by many famous debaters.
I deem it a duty and pleasure to again offer my sincere thanks to the people of the beautiful county of Matane for the honour they have bestowed upon me by electing me to this house. They may rest assured that I shall do my utmost to promote the true interests of my county and country.
The county of Matane comprises two constituencies, each having its representative in the Quebec legislature: that of Matane and Matapedia. The provincial constituency of Matane includes the parishes located for

The Budget-Mr. Larue

the most part along or close by the shores of the St. Lawrence river, and its population is made up of farmers, workmen and fishermen.
The improvement of water transportation is a problem which interests in the highest degree the people of my county. The parishes of Metis and Capucins have immediate need of wharfs. The Baie-des-Sables wharf, to be of any use should be extended at least 400 feet. The wharfs of Riviere-Blanche, St-Felecite, de Grosses-Roches and Mechins also need many improvements. The main harbour of the district is that of Matane situated at the opening of the river bearing that name. The completion of the work, begun some years ago, is necessary not only in the interest of the town of Matane but in that of all the neighbouring parishes. At the extreme end of the two breakwater wharfs built on each side of the river, at its opening, sand accumulates during the winter which in the spring partly obstructs the entrance to the harbour.
Each year, dredging must be carried on. This nuisance would entirely disappear if the breakwater wharfs were extended a few hundred feelt. If this work was carried out, boats of an average tonnage, such as those which ply betwen Quebec, the north coast and Newfoundland, could easily enter the harbour of Matane. This would promote, to the great advantage of Matane and the adjacent parishes, a trade intercourse between the south and north shores. The farm products of the county of Matane would benefit by having a market easy of access.
There is another question of vital importance to the Matane district, namely the aid which must be given to the fishermen. We are dealing with excellent people, honest and laborious who need assistance to provide themselves with the necessities of life. Grants must be extended to the fishermen in order to carry out the work of removing dangerous rocks which lie at the bottom of rivers. This would permit small fishing crafts to enter and leave their shelter.
The county of Matane is partly served by the Canada Gulf and Terminal Railway from Mont-Joli to Matane. The freight rates are high and the service is far from being perfect. This railway line shauld be extended to the wharfs of the Matane Harbour so as to cut down the freight cost on goods which are shipped from that harbour. In order to improve the service, in the interest of this district, this railway line should be purchased by the National Railways. Objections might be made that the cost would be prohibitive, however. I think that it is more important for a

state railway system to give a good service to the country than to purchase luxurious hotels abroad.
I now come to the constituency of Matapedia, whose population is made up for the most part of farmers, settlers and workmen. In this constituency which is located in the interior, the main line of communication and transportation is that of the Canadian National Railway.
I may say that the service, on the whole, is not very good in that section. The principal passenger trains running from Montreal to Halifax and vice versa, pass during the night when there are practically no railway agents at the stations. This means that the service is far from being satisfactory, that people cannot obtain railway tickets nor any information as to train arrivals and must at times perform the duties of baggage master. This section is one of predilection for the Canadian National Railway officials when they wish to economize. Two stations are to be soon deprived of their agents. We are wondering if the Canadian National Railway intend soon to have the trains run without their conductors, brakesmen and even without locomotives. No such service would be tolerated in any other district, and I strongly protest against this high handed way of treating the Matapedia valley.
Matapedia county comprises a number of large villages, and public buildings are needed in many localities. For a number of years past there has been question of constructing a railway line which would penetrate to the interior of the Gaspe peninsula. The preliminary survey has been done and plans have been prepared by engineers previous to every election, at the request of the preceding administration. The construction of this railway is necessary to the development of settlements in that section of the country, it would greatly help the parishes which have been opened to settlers and would serve at least .thirty parishes in the Gaspe peninsula.
Mr. Esdras Minville, a Montreal professor, published last autumn, in the newspaper "Le Devoir" very extensive, interesting and instructive articles on this subject. I am aware that, in the present circumstances, with a deficit inherited from the former administration, it is difficult for this government to grant all the requests we make; however, under the able leadership of the Right Hon. R. B. Bennett, I feel confident that before long the country will find an era of prosperity which can rightly be expected with the leader that presides over its destinies, and then the people of the county of Matane-comprising the

The Budget-Mr. Seguin
constituencies of Matane and Matapedia-will have the service to which it is entitled. I earnestly request the hon. Minister of Public Works (Mr. Stewart) not to ignore my county like his predecessors on the other side of the house did, I beg of him to remember that the county of Matane is located in Canada and thereby is entitled to its fair quota of the public funds voted by the house for public utilities.


Mr. P. A. SEGUIN (L'Assomption-Mont-calm) (Translation):: I deem it my duty to
express on behalf of the people of l'Assomp-tion-Montcalm, which I have the honour of representing in the house, their appreciation of the budget presented by the right hon. Prime Minister (Mr. Bennett), equally Minister of Finance.
I twice carefully read the speech of the right hon. Prime Minister and I endeavoured, by all possible means, to find in what way this budget can relieve unemployment at present prevailing in this country, and especially, how the provisions mentioned in his speech can help that so indispensable part of our population, namely, the farming class;
I was unable to discover anything which can inspire the least hope of relief to either of them. I know that I reecho the feelings of the great majority of the people of Canada and especially those of my section in stating, openly, that the present government being unable to announce, through the mouthpiece of its Prime Minister, any measure in keeping with the numerous pledges made to the people at the last election, deserves to be highly censured for its administration of the affairs of this country. It is no secret that even among the most earnest followers of the government, in the house and throughout the country, there is a large number of them who do not conceal their utter condemnation of the government's policy.
I have not the least doubt, sir, that at present, the right hon. Prime Minister is fully aware that it is much easier to promise the moon than to deliver it.
Where are these great reformers, these great savers of the people who, in 1930, were to bring back prosperity by relieving unemployment and obtaining for the farmers better prices for their products, and more especially for their butter? All will recall the unkept pledges made by the leader of the government and his candidates in the course of the last election. Prosperity was to knock at every door in Canada.
An emergency session was to definitely settle the question of unemployment, and butter, especially, was to command a much 22110-1751
better price the moment they took the matter in hand.
Three months, six months passed, and now the government have been nine months in office and what insignificant results have we witnessed! We can well say that the mountain in labour has brought forth a mouse.
Who has forgotten the alluring and exaggerated appeals made on the political platforms during the election campaign of June and July, 1930?
As the economic crisis, which was spreading throughout the world, had begun to be per-oeptibly felt, it was an easy matter for these gentlemen to frighten the people and gain their sympathies by means of pledges easy to make but hard to fulfil. Is it not a fact, sir, that, at the time, the existing depression was blamed entirely on the government and the King administration was charged of being responsible for this economic crisis.
If the government of that day is to be held responsible-according to the leader of the present administration-is it not a fact that, depression having become more acute, unemployment having increased fivefold, our farmers finding no sale for their products, even at ridiculously low prices, we must conclude that the panacea proclaimed by Mr. Bennett and his followers was but a decoy to the discredit of this government.
And if to-morrow, one year after the July election, the Canadian people were called to again register their vote, there is not the shadow of a doubt that this government would be overwhelmingly defeated; however as it has a five year mandate, the people must be patient and prepare to have their turn while praying Divine Providence to save them from starvation. May I ask, sir, whether that so boasted protective policy which the government have inaugurated brought back prosperity? Has it provided more work, and thereby, brought more comfort in the Canadian homes?
As an outcome of tariff changes carried out at the emergency session, the farmers have to pay dearer for what they purchase, while what they sell does not even give them a fair return for their labour.
I have had sir, the occasion of stating, and I have not the slightest hesitation of repeating it, though I am a Liberal, that I request the utmost protection for all that pertains to agriculture either directly or indirectly. I am in favour of any measure of protection which will result in raising the price of butter, grain, vegetables, in brief all farm products. With reference, especially, to tobacco, it seems that it would be an easy matter for

The Budget-Mr. Seguin
the government to increase the price since it would only need slight changes in the excise taxes and customs duties.
Is it not a fact and a very deplorable one to note that butter-which was used by our opponents as a great battle cry in 1930, when it sold at 34 and 35 cent per pound-retails to-day at 20 and 22 cents; that cheese which sold last year from 15 to 19 cents per pound, sells to-day from 10 to 13 cents; that eggs which sold from 35 to 40 cents per dozen last year, sell to-day 19 to 20 cents? What are we to think of meat which sells at ridiculous prices, prices unheard of for 30 years? Vegetables, among others, potatoes, were practically given away last spring for 15 and 20 cents a bushel, and in a number of cases found no purchaser.
I hear our opponents saying: What is ^ the use of all this recrimination since the crisis is a world-wide one and that the government is not quite responsible for it?
But, sir, if in 1930 the government of the day was held responsible for being the cause of this crisis, according to our opponents who then strongly appealed to the people to cast their votes in their favour in order to wipe out all these ills, are we not justified to-day in telling them that they deliberately deceived the people and after having stolen their mandate they give proof of the worse helplessness?
With reference, sir, to a question which greatly interests a number of people in my district, allow me to refer to the subject of tobacco. I must state, to the credit of the Liberal party, that this industry became a paying proposition when the Liberal government specially took up the matter. In 189i, at the suggestion of the Hon. Mr. Brodeur, then Minister of Inland Revenue, the government of Sir Wilfrid Laurier put a duty of 10 cents a pound on imported tobacco; afterwards, and gradually, the Liberal administration increased this duty to 40 and 42 cents. This progressive increase of customs duties levied on imported tobacco developed in Canada and more especially in my county an industry which spread almost everywhere.^
At present, it is found that this protection of 40 cents is insufficient and it would be necessary that the excise tax and customs duty be again increased to insure to the tobacco growers better prices for the fruit of their labours.
An important delegation of my section of the country, thinking they would be welcomed recently addressed themselves to my colleague the hon. member for Berthier (Mr. Barrette) so as to be introduced to the
* TMr. Seguin.]
government. To my great surprise and notwithstanding the zeal which my colleague (Mr. Barrette) must have displayed, neither the Prime Minister nor the Minister of Agriculture, who are more especially interested in the matter, took the trouble of coming to listen to the just claims of the tobacco growers of the district of Joliette. They had to entrust the hon. Postmaster General and the Solicitor General with the task of presenting their claims to the Minister of Finance and the cabinet so as to obtain the protection which, in their opinion, is the only way to insure the tobacco growers the reward to which they are entitled. This delegation of tobacco growers received the assurance of the Postmaster General and Solicitor General that their just claims would certainly be looked after, seeing that they had now to deal with a protectionist government. One of the ministers even stated that they could not understand why there had been so much delay in giving their claims due recognition. Reassured by these new promises made wilth the authority of cabinet ministers, our friends, the tobacco growers returned home satisfied that at last they could expect a reasonable reward for their strenuous labours.
Not finding, sir, in the budget speech any sign that the right hon. Minister of Finance took any notice of the request made by the tobacco growers of my district, I must con-elude-as I would not be so unfair as to think that the hon. Postmaster General and the hon. Solicitor General did not lay the claims of the tobacco growers before the Minister of Finance and the cabinet-I must conclude, I say, that their influence was not of sufficient weight or that the right hon. Prime Minister, too busy in looking after the interests of his friends, the manufacturers and high financiers, entirely forgot to consider the claims of our friends, the tobacco growers.
May I, sir, since it is not too late, insist that the government, in order to increase the revenue of Canada, raise the customs duty by at least 50 cents per pound on foreign tobacco with stems, and at least 75 cents per pound on stripped tobacco, as was requested by the memorandum submitted by the delegation which I mentioned. In order to foster the marketing of tobacco, the government should agree to another suggestion of the tobacco growers of my district, namely reducing the excise tax on cigars selling from $1 to $3 per thousand and on manufactured tobacco from twenty to five cents per pound with an additional tax as follows: (a) Five cents per pound on tobacco selling more than sixty cents and not over

The Budget-Mr. Seguin
ninety cents; (b) ten cents per pound on tobacco selling ninety cents and not over SI.20 per pound; (c) fifteen cents per pound on tobacco selling over $120.
Is it not disgraceful to find that the tobacco grower, at present, receives for his labour only eight to ten cents per pound when the government receives an excise tax of twenty cents for the same product manufactured?
Is it not shameful to find that the poor farmer who labours from 7 a.m. and often from 5 a.m. to 7 or 8 p.m. receives for his labour only eight to ten cents per pound while the treasury pockets twenty cents per pound for this tobacco when manufactured?
It is an urgent matter that the government should assist the tobacco grower, first by having enacted the suggested changes to the excise and customs tariff, secondly by endeavouring to find new markets.
With further reference to tobacco, I wish, sir, to draw the attention of the Minister of Agriculture who I regret is not in his seat,- however I trust his colleagues will remind him,-to a grant made by his predecessor, the Hon. Mr. Motherwell, to the Co-operative Association of Tobacco Growers of the district of Joliette, a grant that the department did not renew after the change of government. It is a matter of $6,666 which was included in the estimates of the Department of Agriculture. I would respectfully urge the Minister of Agriculture to authorize the payment of this grant, on which this Co-operative Association depends and which would be of great help to them. I shall further add and assure the minister that if he will redeem the pledges made by my opponents during the last election, and moreover increase this grant to $10,000, I shall thank him and publicly give him all the credit for this act.
There is another industry, sir, which greatly interests quite a number of the farming class of this country and that is the maple sugar industry.
It would be an easy matter to create a dependable income for the maple sugar and syrup producers, if our protectionist government gave this product the protection which it requires and favoured those who need protection.
The United States government, after having placed a duty of 8 cents per pound on our maple sugar, was compelled to reduce this duty to 4 cents, to meet the wishes of the American people who want our maple sugar and syrup; this duty however is still prohibitive, and I think that in order to promote the sugar and syrup industry in this country it behooves the government to grant a rebate
of 5 cents per pound on maple sugar or 50 cents a gallon on maple syrup, when exported.
This would promote the exportation of this product abroad; once it was known it would highly be appreciated and better prices could be obtained, owing to the great demand which would result.
May I, sir, draw the attention of the government to the Bankruptcy Act. I wish to state that this act, so far as it concerns the Canadian fanner and more particularly the farmer of the province of Quebec, is a grievance which should be righted immediately. This act, which is a necessity for trades people, is at present the main cause of the loss of credit suffered by the farming class.
Our farmers find it impossible now to borrow on the security of their farms, because the lender has had to suffer such losses owing to the enforcement of the Bankruptcy Act which permits an unscrupulous assignee to pile up the cost of the liquidation; this often makes the lender lose part of his loan on a first mortgage, notwithstanding the fact that the lender took precautions not to make a loan greater than half of the value of the property mortgaged.
This question is of the utmost importance and I particularly draw the attention of the government to it, requesting them to look into the matter and take the necessary steps to prevent, before it is too late, this Act causing greater havoc in our rural sections.
I also wish, sir, to take the opportunity of inquiring what attitude the government intends to take in connection with the aggressive measures resorted to by the Anderson government against the Roman Catholics and French Canadians of Saskatchewan.
Already, certain ministers of the crown, as well as members on the other side, such as the hon. member for Matane (Mr. Larue) have expressed their views on this question and stated that they greatly sympathized with the minority, which is being deprived of education in the French language, and to which very little religious teaching is given in schools.
It is all very fine, sir, to express sympathy, as did the hon. Solicitor General (Mr. Dupre), the hon. member for Montmagny (Mr. LaVergne) and the hon. member for Matane (Mr. Larue). This, however, does not alter the situation; what I wish to know is what measures the government intends taking to give justice to the French Canadians and Catholics of the province of Saskatchewan.
All, in the house, know how generously the English and Protestant minority are dealt with in Quebec. Strong evidence of this ha*
275S
The Budget-Mr. Seguin

often been given by our English speaking fellow-citizens from Quebec and by men from other parts who do not speak the language or practise the religion of the great majority of the people of Quebec.
Why, sir, should our people who are so broadminded in Quebec, see their compatriots ostracized and suffer injustice under the rule of a Tory government in Saskatchewan?
What would be the verdict, if the Quebec government, applying the same measure of justice, or rather injustice, inflicted on the English speaking people and on those who are not Roman Catholics in our province, the same treatment which is meted out to the Roman Catholics and French Canadians of Saskatchewan. What an outcry would be raised here in the house and in both the Catholic and Protestant press throughout the country. Yet, this treatment is meted out to the French speaking and Catholic minority of Saskatchewan. Here and there a weak voice, on the government side, is heard protesting; however, the leader himself and the government have not yet expressed their views in this respect; it is, however, high time that this house and the country should know what sentiments they harbour on the subject.
Confederation placed us on an equal footing, as Sir John A. Macdonald stated, and it is high time that we should know whether we were deceived and too credulous.
Before resuming my seat, I wish to glance once more over the budget presented by the right hon. Prime Minister, as Minister of Finance, and again strongly protest against the lack of provision which the budget shows in order to relieve the farmers and the working classes of this country.
Where is the immediate prosperity promised to us at the last election? What has been done and what relief is being afforded to the innumerable army of the unemployed to whom work should be given.
The government instead of fulfilling its pledges to the people, seem to take delight in burdening them by levying new taxes, especially on the middle class and on the one which has the least resources.
Is it not an injustice for instance, to exact a tax of two cents on a cheque of $1, and the same tax on a cheque of $100 or $1,000 or even $100,000? It is evident that the person who has to issue the most cheques for small amounts is the one who has but a small balance to his credit in the bank, and, consequently he should be spared the most. I could apply the same argument to the increase in postage rates and also to the sales tax; however, my time is too limited.
[Mr. Seguin.1
Could not the government have found means to tax the high financial interests, the
large corporations and wealthy companies instead of taking from the pockets of the less fortunate people, what is needed to make up the deficit due to its carelessness?
Mr. Speaker, I shall close my remarks by asking the government to accept my remarks in the spirit in which they are offered and to realize that they were made in the best interests of the farming class, which is without gainsay, the one which is most deserving of the greatest protection on the part of our government.


Mr. SAMUEL GOBEIL (Compton):: As I have but a few minutes at my disposal, I shall confine myself to one matter, namely, the chief argument that has been advanced in this house by hon. gentlemen opposite, that the budget which we are now considering is a rich man's budget. In this regard I should like to refer particularly to the remarks of the hon. member for Beauce (Mr. Lacroix), who really started the ball rolling. The hon. member for Beauce stated, according to the translation of his speech as it appears on page 2321 of Hansard of June 4:
It is the budget of a man who personally must be immensely wealthy and seeks thereby to protect only the privileged class-


Some hon. MEMBERS:: Hear, hear.


Samuel Gobeil: Wait before you applaud. -namely, those who are rich, forgetting entirely that the majority of the people of this country, not to say 99 per cent, is made up of workers who can barely provide for their families.
Later on, the hon. gentleman added these words:
There is also a group of about 25 citizens who are taxed on a revenue of $1,000,000 or more, yearly. The latter have been specially favoured, as my statement will show.
I wish to observe the rules of this house, Mr. Speaker, but I confess I am at a loss to find appropriate words to qualify such a statement. If the hon. gentleman had suggested that there were only 24, or 20, or even 15 persons with such an income, I might qualify his statement as incorrect. But it has been proved, and the hon. gentleman knows it as well as the rest of us, that there is no single person in this dominion with such an income.


Mr. LACROIX:: Who has proved it?


Samuel Gobeil: The hon. member for
Dauphin (Mr. Bowman) has proved it-


Édouard Lacroix: The man with such an income might have avoided the tax.

The Budget-Mr. Gobeil


Samuel Gobeil: The tax has not been avoided. The fact is that there is not, and there has not been in the last five or ten years a single citizen of Canada with such an income


Édouard Lacroix: Who told you?


Samuel Gobeil: Who told me? I got the information where any other hon. gentleman can get it. If my hon. friends will go to the proper source they will get the information. This statement is false, and the hon. gentleman knows it. The hon. gentleman also stated that the poor were paying more taxes than under the Liberal regime. Is it not a fact that 26,000 of those who were paying income tax under the former administration will now be exempt? Is it not true that 25,000 persons, who paid income tax on the basis of an exemption of $3,000 will now be relieved of taxation, with the additional exemption of $500? None of them will pay a tax. They are not the rich, and they are not the poorest class in the country; there are hundreds of thousands of people who do not pay income tax, but these are the poorest of those who pay income taxes. There is also another class of people in connection with whom the tax has been reduced; those are the people paying on an income of from $3,500 to $6,000. Those people also have seen their taxes reduced by this budget. They are also among the poorer classes of those who pay income tax.
Let us go a step further and see what was the position when the Liberal government took office in 1921. At this point let me remind the house that until this session Canadians never heard from this party the argument that the Liberals were bringing in a rich man's budget. When the Conservatives went out of office in 1921 the rate of income tax applicable to persons other than corporations were as follows: there was a normal tax of four per cent on incomes up to $6,000 and of eight per cent on incomes in excess of $6,000. There was a supertax of one per cent on incomes over $5,000, increasing to 64 per cent on incomes of $1,000,000. In addition there was a five per cent tax computed on the sum of the normal tax and the supertax. This meant a tax of $696,349.50 on an income of $1,000,000. What did the Liberals do when they came into power? By chapter 10, sections 16 and 17, George V, the King administration repealed the old rates, abolished the normal, the supertax and the five per cent additional tax, and introduced the graduated scale which began at two per cent and increased to 50 per cent on incomes in excess of $500,000. Those rates were reduced further in 1927 by chapter 31, section 17, George V, under which an additional 10 per cent discount was given, leaving the highest rate 45 per cent. Did anyone hear the Conservatives at that time say this was a rich man's budget?
Mr. ST-PERE: They were taxing the new rich.


Samuel Gobeil: I did not catch the remark; if I understood it I think I could reply. A further cut was made in 1928 by chapter 12, sections 18 and 19, George V, the discount being increased from 10 per cent to 20 per cent, which reduced the maximum rate to 40 per cent. After these three decreases the tax on an income of $1,000,000 was reduced from $696,349.50 to $362,928, a difference of 8333,421.50.
On an income of $500,000 the tax under the Conservative government was $318,349.50. This was reduced by the first change under the Liberal government to $203,690. The next reduction made it $183,321, and the last reduction brought the tax on an income of $500,000 to $162,952, or a total reduction of $155,397.50. I want to point out again that in all those years not one member of the Conservative party, then in opposition, accused the Liberal administration of being the party of the rich men or the multi-millionnaires. I am not surprised at that, because it is not the practice of the Conservative party to raise cries of prejudice as between one class and another.
Now I should like to say a few words, if I have time, with regard to the bonus on wheat.


An hon. MEMBER:: What about butter?


Samuel Gobeil: We will talk about butter also. Again hon. gentlemen opposite are trying to prejudice one part of the country against another. I say, Mr. Speaker, that if this confederation is to continue and to be a success; if this Canada of ours is to become a great country, every section of this dominion must be prepared to give and take. I am free to admit that hon. members from the west and bon. members from the east lose no opportunity to further the cause of their particular districts, and 1 might add that at times I believe they are not altogether quite fair. As I have said before, however, if we are to have a great country we must be prepared to give and take. There are different forms of bonuses. It is quite true that the provinces of Quebec and Ontario will share the cost of that bonus to the west, but is it not true also that the central part of Canada derives some benefit from the policies pursued by the different governments of Canada?
We had a good illustration of this fact a couple of days ago in the agriculture com-
The Budget-Mr. Gobeil

mittee. Every hon. member knows that this year the price of eggs has been very low, and the farmers of Ontario and Quebec are getting only from 15 to 20 cents per dozen for their eggs. Hon. members representing western constituencies proved to the satisfaction of the committee that, because of transportation costs and other factors, the farmers in the western provinces were getting only from five to eight cents per dozen. Under the constructive policy of this government we have had established in this country over eighty new industries since we came into power, and of that number over seventy-five were established in the provinces of Ontario and Quebec. Therefore if the people of the west have to pay even a little more for the goods which they are buying from the east- and while I do not think they are paying very much more, I do not deny that in some instances they might pay a little more-I think the majority are paying it quite willingly.
Is it not true that we in the eastern provinces have the benefit of a local market at our doors? While the western farmers are getting eight cents a dozen for their eggs, we are getting twenty cents. Is it not true, as the hon. member for Long Lake (Mr. Cowan) said the other night, that we in the eastern provinces are dependent every year on the millions of dollars that constitute the outcome of the western crop? Let us just take the Marine department. Is it not true that the eastern provinces are every year receiving millions of dollars of which the western provinces must pay their Share? Some hon. members might say that these millions are going for the good of the west as well as of the east. That is true to a certain extent, but at the same time it is also true that every year the citizens of the eastern provinces are benefiting by those millions of dollars that are spent here, our labourers are receiving wages and our farmers are having a local market for their products. When I use the word "citizen," I mean it to include all classes, not excepting the farmers. That is where I claim hon. gentlemen opposite are quite mistaken. The way they talk, it seems to me they regard the farmers of Quebec and Ontario as men almost ready for an asylum. But far from that, the farmers of Quebec and Ontario are intelligent people, and they realize what they are receiving from this government. The other night the hon. member for Beauce (Mr. Lacroix) and some other members from Quebec said that members on this side from the province of Quebec would not like to have to go back and face our 
electors. Let me tell hon. gentlemen opposite that any time they want to come to Compton and face the electors there, I am willing they should come.


Édouard Lacroix: My offer is to go anywhere and at any time.


Samuel Gobeil: What we said during the
election campaign was that if the Conservatives came into power, they would see to it, that the farmers of Quebec and Ontario would get the market of the Canadian people for their products. Although it is quite true that the price of butter and cheese is lower than it was last year, I would not be afraid to return to Compton county. I know the farmers of Quebec are satisfied to get their own market for themselves.


Some hon. MEMBERS:: Oh, oh!


Samuel Gobeil: I take it for granted that
I am speaking to intelligent people, and when I say the farmers of Quebec are satisfied, it does not mean they would be as well satisfied to get twenty cents as thirty cents a pound for their butter. But we have fulfilled our pledges, and the farmers of Quebec, when they have their own market to themselves, are satisfied to compete with the rest of the world in the butter and cheese industry.


Mr. RHEAUME:: Let us make a bargain: I will resign my seat and you resign yours.


Samuel Gobeil: My hon. friend need not
be so ready to resign his seat. There is no necessity for his resigning his seat or for my resigning mine, but I invite the hon. gentleman to come to Compton county at any time he cares, and I shall meet him on the platform. I can understand why the hon. gentleman would not like to go there. If he were resigning his seat and I mine, I know what we would see in the province of Quebec: we would see what we have seen in the past, campaigns into which race cries and prejudice enter.


Pierre Auguste Martial Rhéaume: Not in my county. Resign your seat and you will be defeated.


Samuel Gobeil: The time for such campaigns is gone and from now on, when the Liberals of Quebec come before the electorate, they will have to talk politics, something which they have not done in the past.
On motion of Mr. McIntosh the debate was
adjourned.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.

Questions
Thursday, June 18, 1931.