1934-05-15

[Stage Direction]
The house resumed from Monday, May 14, consideration of the motion of the Minister of Finance that Mr. Speaker do now leave the chair for the house to resolve itself again into committee of ways and means, and the amendment thereto of Mr. Ralston.
Mr. SPEAKER:: Before the debate is
resumed, I think it would be well to give a ruling on the question of order raised yesterday by the hon. member for Wetaskiwin (Mr. Irvine) as to whether the amendment to the motion is in order. On April 23rd, Mr. Ralston moved as an amendment to the motion of the Minister of Finance that Mr. Speaker do now leave the chair for the house to resolve itself again into committee of ways and means, the following:
This house regrets that the proposals of the Minister of Finance give no indication of the intention of the government to abandon the policies of economic nationalism which have proved so disastrous to Canada's trade. It is of the opinion that the immediate substitution therefor of policies which will promote export trade throughout the world is essential to any permanent improvement of conditions in Canada, and to the successful application of other policies respecting credit and employment designed to effect this end.
On April 30, Mr. Spencer moved a subamendment and on May 7 on a question of order raised by Mr. Mackenzie, of Vancouver Centre, as to the subamendment, I held that the subamendment was not in order as it sought to deal with the question of credit which had been debated on a motion by Mr. Lucas and the matter of credit had been by consent referred to the select standing committee on banking and commerce where it is being considered.
It is now argued that the amendment is not in order and for the same reasons as said subamendment was held to be not in order.
When this amendment was moved, there was on the order paper Bill 51 entitled, "An Act to Improve the Methods and Practices of Marketing of Natural Products in Canada and in Export Trade, and to make further provision in connection therewith." This bill was read a first time March 26 and on April 23, when this amendment was moved, was on the order paper for second reading. The bill provides for export trade and for regulating the export of goods from Canada. See the title; and paragraph (b) of subsection 4; and paragraph (f) of subsection 5 of section 5; also section 12, subsection 2.
."Mr. Duranleau.]
On February 13, Mr. Woodsworth moved the following amendment to the address in reply to the speech from the throne:
That the following be added to the motion:
We respectfully regret that Your Excellency's present advisers have not taken such steps as are necessary to deal adequately with unemployment, to reduce the burden imposed by tire public debt, and to put the agricultural industry on a basis that will ensure the farmer a decent standard of living.
Thereupon, employment was discussed and the amendment was disposed of by the house on a division resulting in 54 yeas and 89 nays.
That amendment dealt with the question of employment generally and the amendment now before the house is to the same effect and so is not in order.
My decision is supported by the following precedents. Bourinot, page 328:
"It is, however, an ancient Tule of parliament that no question or motion can be regularly offered if it is substantially the same with one on which the judgment of the house has already been expressed during the current session." The old rule of parliament reads: "That a question being once made, and carried in the affirmative or negative, cannot be questioned again, but must stand as a judgment of the house."
May, 13th edition, at page 272 says:
A matter already appointed for consideration by the house cannot be anticipated by an amendment, while a notice of motion as long as it remains upon the paper whether for a specified day or not, prevents its subject matter being discussed by means of an amendment to a motion.
Speaker's rulings on the question are reported as follows:
207 II.D. 3 s 500:
Now there is a rule of the house that when a matter has been expressly set down for consideration, no hon. member can anticipate it by raising a discussion on the subject.
308 H.D. 3 s 1755:
I must point out to the hon. member that he has introduced a bill, which is now standing on the paper for the second reading, which contains a distinct reference to the subject matter of the present motion; and, as that bill is to be brought on upon a future day, the hon. member would not be in order in moving his resolution now, as he would be anticipating the discussion upon the bill.
333 H.D. 3 s 851:
The first two amendments on the paper, the first standing in the name of the hon. member for Iloxton, and the second in that of the hon. baronet the member for Coekermouth, are out of order as amendments, inasmuch as they anticipate the discussion, one on three and the other on four bills which the house has appointed for a future day, and one of those bills, I observe, is in the name of the hon. gentleman himself. The amendment, therefore, of the hon. gentleman will be out of order as an amendment to the address.

The Budget-Speaker's Ruling
66 Parliamentary Debates, 4 s page 923:
The subject of the hon. member's amendment to the address is relative to several bills on the order book and he will have an opportunity of submitting his views to the house when one of them comes on. He cannot now anticipate discussion on a bill which is on the order book.
The same practice has always been followed in Canada, see Bourinot, 4th edition, page 320:
An amendment cannot anticipate a notice of motion on the order paper.
In this case the amendment goes further and anticipates a bill No. 51, now being considered in committee dealing with marketing and export trade.
I therefore rule that the amendment moved by the hon. member for Shelburne-Yarmouth (Mr. Ralston) is out of order, as it is substantially the same as one on which the judgment of the house has already been expressed and it deals with matters already before the house.


Mr. RALSTON:: For the reasons given in the house yesterday by the hon. member for Vancouver Centre (Mr. Mackenzie) and others on this side of the house who spoke I respectfully appeal from your ruling, Mr. Speaker.


Mr. BARBER:: I was paired with the
hon. member for Humboldt (Mr. Totzke). Had I voted I would have voted to sustain the Speaker's ruling.


James Layton Ralston: I was paired with the
Minister of Finance (Mr. Rhodes). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. MACKENZIE (Vancouver):: I was
paired with the hon. member for Saskatoon (Mr. MacMillan). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. McINTOSH:: I was paired with the
hon. member for Winnipeg South Centre (Mr. Kennedy). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. SMOKE:: I was paired with the hon.
member for Temiscouata (Mr. Pouliot). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. STEWART (Edmonton):: I was paired with the Minister of the Interior (Mr. Murphy). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. RYERSON:: I was paired with the
hon. member for Norfolk-Elgin (Mr. Taylor). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. VENIOT:: I was paired with the hon.
member for York-Sunbury (Mr. Hanson). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. NICHOLSON:: I was paired with the hon. member for North Timiskaming (Mr. Bradette). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. TUMMON:: I was paired with the
hon. member for Hochelaga (Mr. St-Pere). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. SPENCE:: I was paired with the hon. member for Northumberland, Ont. (Mr. Fraser). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. McKENZIE (Assiniboia):: I was paired with the hon. member for Durham (Mr. Bowen). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. MacLEAN:: I was paired with the
hon. member for Royal (Mr. Jones). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. HOWARD:: I was paired with the
hon. member for Grenville-Dundas (Mr. Casselman). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. BO YES:: I was paired with the hon.
member for West Elgin (Mr. Hepburn). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. DORION (Translation):: I was paired with the hon. member for Lotbiniere (Mr. Verville). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. COTNAM:: I was paired with the hon. member for Nipissing (Mr. Hurtubise). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. GEARY:: I was paired with the hon. member for Laurier-Outremont (Mr. Mer-cier). Had I voted I would have voted to sustain the Speaker's ruling.


Mr. DUBOIS (Translation):: I was paired with the hon. member for St. John-Albert (Mr. Bell). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. RAYMOND (Translation):: I was
paired with the hon. member for St. Antoine (Mr. Bell). Had I voted I would have voted against the Speaker's ruling being sustained.


Mr. ROWE:: I was paired with the hon.
member for Beauce (Mr. Lacroix). Had I voted I would have voted to sustain the Speaker's ruling.
[Mr. Ralston.1


Mr. DUBUC (Translation):: I was paired with the hon. member for Halifax (Mr. Black). Had I voted I would have voted against the Speaker's ruling being sustained.

The Budget-Mr. Manion


Hon. R. J. MANION (Minister of Railways and Canals):: Mr. Speaker, this house met late in January and it is now the middle of May, so for the better part of four months we have been having discussions in the house as to the various measures which have been brought down by the government. During that time we have had a very great deal of fault finding and carping criticism, particularly on the part of the Liberal opposition. Their type of speeches might well be illustrated by the speeches delivered by the right hon. leader of the opposition (Mr. Mackenzie King) on the address, which took some four and a half hours, and the speech of the hon. member for Shelburne-Yarmouth (Mr. Ralston) on the budget, which took the better part of two and a half hours. In other words, those two speeches lasted for some seven hours, yet after a fairly thorough and somewhat painful reading of those speeches I have not been able to find one constructive suggestion advanced with the exception of the proposal by the hon. member for Shelburne-Yarmouth that we should have a refunding operation to cut down the interest rates in our country.
I wish to be entirely fair; the hon. member did make that constructive suggestion, but that proposal has been advanced by many members of this house. I think I have heard at least half a dozen members on this side deal with that matter, and that is something which all fair minded men must consider worthy of deep thought. To-day in Canada we have interest payments, if you include the Canadian National for which we are responsible. totalling $200,000,000 per annum in round figures, a stupendous burden to be placed on the backs of ten million people. The immensity of that burden can be realized even more clearly if it is remembered that it was not until 1910 that the federal revenues of the Dominion of Canada reached 1100,000,000, and at that time we had a population of seven million people. Of course, Mr. Speaker, we usually understand that it is the duty of an opposition to oppose, but at the same time during periods of national crisis in this and other parliaments sometimes it has been the custom of oppositions to rise to greater heights than that. But if you, sir, or anyone else can show me anything, other than the one constructive suggestion I have mentioned, that has been advanced by the present opposition during the four years we have been in power, any suggestion which took into account their country in its hour of trial rather than party politics, I should be very much obliged.
At that, Mr. Speaker, my chief criticism of the opposition at the present time is that whether it is on the address or on the budget, in their severe criticism of us they have entirely ignored world conditions. This country, in common with the rest of the world, has been going through four years of industrial and economic crisis, the worst the world has ever known. I do not give that as a mere figure of speech; I think it is a statement of fact. We have had an unemployment problem in the industrial countries of the world affecting some thirty million people, thirteen million of them in the great, powerful, rich country to the south where, in addition, they have had thousands of banks close their doors to their depositors. Practically all the countries of Europe, and certainly all those which took part in the war, have been unable to pay the interest on their war debts. We have had Fascist dictators spring up in six or eight of the prominent countries of Europe, with a dictatorship of the proletariat in Russia, where communism and starvation have been stalking together throughout the land. Even in South America, where they have no war debts, most of the republics have been unable to pay the interest on their national debts, and away over in the far east we have had threats of war which have endangered the peace of the world. In addition to all this we have had a condition of economic nationalism spring up throughout the world, in the last ten or fifteen years, all of which makes up a chaotic picture which is painful to consider, and of which Canada has been forced to become a part.
Due to world conditions we have had our serious unemployment problem in proportion to the unemployment that has existed throughout the world. In addition we have had a drought condition throughout the prairie provinces which in Saskatchewan alone a year or two ago threw one-third of the entire population upon relief. We find that the world price of wheat dropped to such an extent that the purchasing power of the prairie provinces decreased to an amount something like $450,000,000-a huge amount for that or for any other section of the country. In addition to that they have been unable, because of the world price of wheat, to pay their taxes, and therefore the western provinces-and in this I should add British Columbia-the four western provinces in avoiding default have indeed been dependent for financial assistance upon the Dominion of Canada. Then, added to all that, is the fact, which hon. members opposite ignore on all

The Budget-Mr. Manion

occasions, that the chaotic condition which in a few brief sentences I have described started before they went out of power. In fact, it started nearly a year before they went out of power, because it began after the crash in October of 1929. Yet, in their criticisms of this government, they never refer to world conditions, nor do they even admit that such conditions have existed.
Our record is open for all to read. I think it is a very good one, and in a few brief sentences I am going to cover the work of this government in its term of office, which has extended about four years. In the first place we realized that economies must be put into effect in Canada, and with that in mind we put those economies into effect to an amount of something like $81,000,000 per annum, cutting down the per capita cost of government in this country from $9.60 in the year before the war to $9.03 last year. We spent large sums of money on public works; we assisted the provinces, municipalities and the railways in their work of relieving unemployment, and we gave direct relief running into a large amount of money. We lent money by tens of millions to the western provinces. We saved the savings bank of the province of Manitoba; we gave a wheat bonus to the wheat growers of the western provinces. All of these actions of ours cost the government of Canada and the people of Canada something in the neighbourhood of $180,000,000. But as a result there has been no starvation in Canada, while in the only socialistic country in the world millions starve. We have maintained sound credit not only of the dominion, but of the provinces and the railways. We have saved their credit.
Then, so far as trade is concerned, we have held our own. We took part in two imperial conferences at which, for the first time in our history, we obtained preferences, profitable preferences-profitable to us and profitable to the other portions of the empire. It is true that the hon. member for Shelburne-Yarmouth (Mr. Ralston) and other hon. members, have criticized my right hon. leader for having bargained to get those preferences. So far as I am concerned I am proud of the fact that my right hon. leader bargained, and I am proud of the fact that for the first time in our history we were on the receiving end instead of always being on the giving end.	.
Then, so far as world trade is concerned we must realize that there has been a serious decrease in the trade of all commercial countries of the world. So much is that true that

total world trade decreased from sixty-eight billion dollars in 1929 to twenty-six billion dollars in 1932, or about 60 per cent. Great Britain, one of the great trading nations, has had a decrease in her world trade in 1932 compared with 1929, amounting to five billion dollars, the United States six billion dollars, and Canada something like one and one-third billion dollars. So that Canada's decrease in trade, for which we have been criticized, has been in proportion to the decrease in the trade of all the other countries of the world, and of the world in general. In other words, we held our own, and last year our domestic exports went up $106,000,000 as compared with the year before, and our imports increased by $27,000,000. Yet in his speech sometime ago the hon. member for Shelbume-Yarmouth accused us of having "shackled world trade." He accused us not only once but a number of times. He said that "Canada had begun an economic nationalism." Well, the facts are that economic nationalism and the shackling of world trade began while my right hon. friend the leader of the opposition and his government were in power. As a matter of fact, the main shackling which has taken place, so far as Canada is concerned, was between the years 1925 and 1930, when a Liberal government was in power.
For example, let us take wheat. It has been pointed out many times that until 1929 wheat was allowed free into many European countries, but that in that year, the one before my right hon. friend left office, Italy, France and Germany raised the duty on wheat to 73 cents, 85 cents and 98 cents respectively per bushel. The truth is that the shackling of world trade and the economic nationalism which have taken place are due to war psychology which has existed since the war, particularly in European countries. It is due to the fact that many of those European countries have the fear of future wars, and are desirous of becoming self-sufficient so that in case of war they will be able to maintain themselves without importing from other countries. But the fact remains that so far as Europe is concerned that shackling took place in years of a Liberal administration in Canada. So far as the United States is concerned, anybody who reads political history or follows the affairs of Canada will know that between the years 1921 and 1930, when the Liberal government was in office the United States put up practically prohibitory tariffs against Canadian farm products. So

The Budget-Mr. Manion
much is that true, Mr. Speaker, that while in 1921, the first year of the Liberal regime, the United States imported $160,000,000 worth of Canadian farm products, in the last year in which the Liberal government held office the United States imported only $40,000,000 worth, or exactly one-quarter. And what was the attitude of my hon. friends opposite? What was the attitude of the present leader of the opposition? What was the attitude of that party when it was in power? It was unable to do anything. The leader of the opposition did not wish "to provoke the United States." As a matter of fact nothing was done by the Liberal government to increase the trade with the European countries and with the United States, or to decrease the tariffs which were rapidly being put up against the Dominion of Canada.
The hon. member for Shelburne-Yarmouth also saw fit to belittle the balance of trade about which, I believe, we may justly boast a little. It must be remembered that Canada's external interest payments, including dominion, provincial, municipal and corporate, amount to something more than $200,000,000 yearly. That money has to go from this country every year. That interest can be paid only in goods, or by borrowing money. But borrowing in the last few years has not been very popular or convenient. With interest being payable in goods I should like to ask the hon. member for Shelburne-Yarmouth or in fact any other hon. member, this question: How can any debtor country-meaning a country which must pay to outside countries more than they return in interest or debts-pay its outside debts if it imports more goods than it exports? It is absolutely essential, if we are to pay such debts, that we must export more than we import. Fortunately the balance of trade which when hon. members opposite left office was very markedly against us, in fact to the extent of $103,000,000, has been changed to a balance in our favour. In other words, in 1930, we bought $103,000,000 more of goods from outside countries than those outside countries bought from us. Last year we had a reverse condition, when we sold to the outside world $152,000,000 more than we bought from it, making a total change in trade figures of $255,000,000, plus gold amounting to something like $90,000,000, most of which we also exported.
That, in a very brief way is the record of this government. But in addition to that, at the present session we have placed before the house a marketing bill, a bill establishing a central bank, a mortgage bill protecting the
74726-193J
farmer and a public works program. Those are pieces of legislation which come to my mind at the moment. Therefore, generally speaking I submit that Canada's affairs have been handled better during this time of crisis throughout the world than have the affairs of any other country in the world, and I say that our condition at the present time is at least equal to that of any other country in the world, and in that statement I make no exception.
Does any sane man on the opposition side suggest that had the right hon. gentleman opposite been in power he could have handled the affairs of Canada during this economic hurricane in a better manner than they have been handled by the present government?


Some hon. MEMBERS:: Sure.


Robert James Manion: Some hon. members opposite cheer. I do not know whether they are the sane group or not. At any rate, Mr. Speaker, I should like to ask them this question: Could their leader or their party, had they been in power, have cured the drought in western Canada? Could they have controlled world wheat prices? Could they have stopped ultra-nationalism or economic nationalism which has grown up, and which was growing up during the nine years hon. members held office? Could they have cured unemployment? Could they have changed world conditions so that Canada would have held a better position or would have been in a better position than she has been in the past four years under a Conservative government? All we have to do is to look over the record of the Liberal party when they were in power and since they have been in opposition. In the four years they have been in opposition their whole record has been one of opposition to everything-opposition to the relief acts for weeks at a time, so much so that the western provinces on one or two occasions were unable to get their seed grain in time.


Some hon. MEMBERS:: No.


Robert James Manion: I think that in a last
minute rush they permitted the bill to go through, but the western provinces had a great deal of delay in getting their seed wheat because of the opposition of my hon. friends opposite. They opposed and are still opposing the Marketing Act. They opposed the translation bill. They opposed economies and they opposed expenditures. They opposed everything. They have done nothing but find fault and criticize. They have gloated over conditions in Canada which are really world conditions, and incidentally they have denied,
The Budget-Mr. Manion

their leader at any rate has denied that conditions have improved in this country. They have capitalized discontent at every opportunity. They have done everything in their power even to destroying national optimism, apparently with no other object than to achieve power which they boast they would be able to do should an election be held at the present time.
I suggest, Mr. Speaker, that the tactics of my hon. friends opposite in times of national crisis such as the present are very poor tactics. I suggest as well that their tactics of holding up every piece of legislation, important or unimportant, that comes into this house, as they have done, brings discredit on the whole of our parliamentary institutions, for which my right hon. friend the leader of the opposition is always expressing so much reverence. I throw out this suggestion not only for the present opposition but for future oppositions.


Some hon. MEMBERS:: Oh, oh.


Robert James Manion: My hon. friends laugh,
Mr. Speaker, but it is exactly the same kind of loud laugh that speaks the vacant mind with which they have opposed everything that has been brought down in this house that has been of a constructive nature. I was going to suggest that if we are to protect the interests of the parliamentary institutions in which we believe, then not only at this time but in the future we should endeavour to bring in either closure or some other method of curtailing useless debate of which we have seen so much in the present parliament.
Then, sir, what was the record of the opposition when they were in power? Their record in power was even worse I believe than their record as an opposition. They saw the trading countries of the world barring out our products, and they did nothing to prevent it. They saw the United States by prohibitory tariffs keeping our goods out of that country and they adopted the old attitude of laissez-ifaire, of doing nothing for fear of provoking the United States. When the crash came in 1929 they first denied that there was any unemployment, and they then took the attitude that they would not give a five cent piece for relief even if there was. So far as Beauharnois is concerned, they are still labouring in the valley of humiliation.
In smaller mattere, such as the Montreal bridge, they said it would cost $9,000,000, and it cost $19,000,000. Why did they not when they were in power and conditions were
IMr. Manicm.]
prosperous throughout the world as they were, bring down an unemployment insurance measure which they boast they would support at the present time? Why did they not when they were in power establish a central bank, which now they do not dare to oppose, and which now they say they were always in favour of, but they did not do anything to establish such an institution in the nine years they were in power. They did nothing about farm credits, and nothing about Senate reform, which my right hon. friend the leader of the opposition had clamoured for. They did nothing about free trade. All these things went into the limbo of forgotten things when hon. gentlemen opposite were in power.
So far as the Canadian National Railways are concerned the record of hon. gentlemen opposite in that respect is to my mind the most appalling of all. The hon. member for Shelbume-Yarmouth, in speaking of the Canadian National Railways, used this sentence:
From 1922 to 1930 the average surplus available for payment of interest due to the public was $24,000,000, and the deficits began again in 1931.
That is one of those half truths in which lawyers so frequently indulge. My hon. friend from Hamilton (Mr. Bell) says, not the best lawyers. That is probably true. I do not think he would do it, but my hon. friend from Shelbume-Yarmouth did.
The facts are that between 1921 and 1930 my hon. friends opposite in the handling of the Canadian National Railways had eight years out of ten in which there were deficits so far as the interest to the public was concerned. They had a total deficit in those ten years of $191,000,000, and only in two years, in 1926 and 1928, was there sufficient earned by the railways to pay the interest owing to the public on bonds. In those two years they had surpluses totalling six million dollars. That means that they had a total deficit between 1921 and 1930 of $185,000,000 in the handling of the Canadian National Railways.


James Layton Ralston: That was after paying interest to the public.


Robert James Manion: Of course, but the interest to the public has to be paid, and most of it incidentally was built up by my hon. friends opposite.


James Layton Ralston: Does my hon. friend say that what I said was not correct?

The Budget-Mr. Manion


Robert James Manion: No, but my hon. friend left unsaid what he should have said to make his statement completely correct. My hon. friend is very clever at that sort of thing, and he is trying to do it again now. He has a clever habit of bringing out only one or two phases of the railway question. He did it in South Oxford, and apparently with good effect. He does it everywhere he goes. He does not tell the whole truth but only one-half or one-quarter and lets it go at that. That is about as close as he got in his statement on the railway question a few days ago.
In regard to interest, let me say that when my hon. friends opposite came into power the amount of interest which the bondholders were receiving from the Canadian National Railways was just $20,000,000 less than it was when they went out of power. In other words, by permitting the Canadian National Railways to go into wild extravagances of many kinds they built up increased interest charges of twenty million dollars a year for that railway in addition to this factor, that the interest to the government was increased in the same period by $12,000,000 per annum by loans and cash advances from the government of my hon. friends opposite. To sum up, they increased interest charges to the public and to the government by $32,000,000 a year in the years between 1921 and 1931.


James Layton Ralston: All voted for by my hon. friends.


Robert James Manion: Yes, probably voted for by your hon. friend because my hon. friends opposite had just sat back and permitted the gentleman in charge of the Canadian National Railways at that time to become such a squanderer of the people's money that nobody dared open his mouth for fear of risking his political life. There was no control whatsoever by the government or by the directorate of that day upon the gentleman who later disappeared from the management of the Canadian National Railways, for the good of the railways and the good of this country.
Hon. gentlemen opposite claim to have cut down the debt of this dominion by $257,000,000 when they were in power. That is the figure given by the hon. member for Shel-burne-Yarmouth, and I shall accept it. At the same time they increased the debt of the Canadian National Railways to the public by $161,000,000 so that there was actually an increase in the debt of this country of $204,000,000. Then in the preelection year of 1929 they permitted Canadian National Railway commitments of between $200,000,000 and
$250,000,000 for hotels, terminals, ships and railways, practically none of which was needed by the Canadian National Railways, and which only added to the funded debt of the railway. They encouraged the wildest extravagances. They rolled the Canadian National Railway pork barrel from Halifax, where they built a hotel for my hon. friend from Shelburne-Yarmouth, clear across to Vancouver and back again. They turned the Canadian National into a political machine and a political club of the most severe kind, and they nearly wrecked the Canadian National Railways, and in fact nearly wrecked the country.
That is the Liberal record so far as the Canadian National Railways is concerned during the last nine years in which hon. gentlemen opposite were in power. I say Mr. Speaker, that their record in regard to that great public utility was more appalling than the record of any other government in Canada, federal or provincial, in regard to any public utility this country ever possessed. But now I am happy to say that due to policies of economy, unpopular I admit, and of restriction of expenditure the Canadian National Railways to-day is well and economically managed. It has good officers and men in charge, and it has an efficiency which has been maintained throughout.
Fortunately business for the Canadian National as well as for the Canadian Pacific is increasing at the present time in line with the general increase in business throughout the world. During the months of January, February, March and April of this year the gross revenues of the Canadian National Railways have gone up $9,000,000 as compared with the same four months last year, while the increase in the gross revenues of the Canadian Pacific amounted to $6,000,000. Incidentally, these figures show that the Canadian National is not suffering very much by the treatment of this government. There is another matter which has not been stated before, one of importance and one which I commend particularly to the attention of the hon. member for Kenora-Rainy River (Mr. Heenan). The number of men working on the railways this last month is 15,000 greater than the number employed three or four months ago.
While the Liberals were in power from 1921 to 1930 they merely floated and drifted along on a world boom tide. They finally tumbled over the abyss in 1929. No signs of wisdom came from them in either the operation or the management of the affairs of this country. No preparation was made for the future when in times like that some
The Budget-Mr. Manion

consideration should have been given to the future. Even five thousand years ago in Egypt they prepared themselves during good times for occasional reverses. At the present time the Liberal party is predicting success at the polls but-


Some hon. MEMBERS:: Hear, hear.


Robert James Manion: Hon. members opposite cheer me and perhaps that is the only cheer I will get from them. I should like to point out that the predictions in 1930 were just as emphatic as those being made at the present time and the results probably will be the same in the future as they were in the past. Hon. members are continually harping on the by-elections.


Some hon. MEMBERS:: Hear, hear.


Robert James Manion: They say "hear, hear." They claim that because of the by-elections we should go to the country because the results show that we do not possess the confidence of the country at the present time. What is the story of the by-elections?


Cameron Ross McIntosh: Pretty good.


Robert James Manion: It is pretty bad for my hon. friends. There have been ten byelections. Five of them were politically unchanged; two we won from my hon. friends opposite, one they took from us; and they also took one from the Progressives, while the group in the southeast corner took a seat from us. So far as the Liberal and Conservative parties are concerned, we took two of theirs and they took one of ours, so we are one up on them in by-elections. I do not know what the hon. members for Shelburne-Yarmouth and Vancouver Centre (Mr. Mackenzie) are laughing at because these are the facts.


James Layton Ralston: What about half truths?


Robert James Manion: Those are absolute facts and I challenge my hon. friend to show that they are anything else. In the last one or two by-elections the majorities have not looked very good for this party. I admit that quite frankly but at the same time I contend that with the conditions we have in the world, there is a natural under-current of discontent shown against all governments when they enter by-elections.


Mr. VALLANCE:: The hon. member is not apologizing?


Robert James Manion: My hon. friend should
apologize for the fact that the whole Liberal party in the province of Quebec was opposed to one man in the city of Montreal who beat

them by 53,000 for the mayoralty. The government in England to-day is made up of the best elements of the Conservative, the Liberal and the Labour parties. That country is muddling through to prosperous days yet in spite of the quality of the government- there is no Liberal party left with the exception of Lloyd George-whenever the government goes to the polls in a by-election they are either defeated or their majority is cut down. The reason for this is the same as the reason for the majorities in the last two or three by-elections in this country. But the hard fact remains that as far as by-elections are concerned, we are one up on my hon. friends on the other side.
The hon. member for Shelburne-Yarmouth has pointed out a fact which he claims to be deplorable. I admit that it is unfortunate that including our railway deficit and relief this country has had to face a deficit in the last year amounting to $135,000,000. This is a serious situation, but I would point out that practically all countries in the world of any importance have had deficits of the same kind. Last year France had a deficit of $375,000,000; Germany had one of $400,000,000; Italy one of $350,000,000; and in June, when her financial year is up, the United States expects to have one between $5,000,000,000 and $7,000,000,000. It has been pointed out that Great Britain had a surplus of $150,000,000, but it should not be forgotten that she did not pay last year the interest on her war debt to the United States, amounting to $182,000,000. Incidentally, we have paid our interest on our war debt. I state this in order to keep the record straight. In order that I may not be accused of misquoting facts, I should like to quote from the budget speech of the Chancellor of the Exchequer, Mr. Neville Chamberlain. He said:
Neither last year nor the year before did I make any provision for the payment of the war debt to America nor for the receipt of war debts or reparations by ourselves. In the absence of any future development. I propose to follow precisely the same line this year.
The fact remains that instead of having a surplus, the United Kingdom had a deficit just the same as practically every other country in the world. For the benefit of those who sometimes complain of taxation, it is interesting to note that the United Kingdom is the most heavily taxed country in the world. Their ordinary revenues last year-they expect to have about the same this year-amounted to $3,500,000,000. Based on population of 40,000,000, this works out at $90 per head. Our revenues amounted to $271,000,000, or $27 per head.

The Budget-Mr. Manion


Mr. HANBURY:: What about deficits?


Robert James Manion: The provinces?


Wilfred Hanbury: No, deficits.


Robert James Manion: They also have a deficit.
I was pointing out that our collections are less than one-third the per capita collections in the United Kingdom. I thought my hon. friend was referring to the provinces and I intended to mention them later on as it is only fair that they should be included in our total taxation receipts. I checked up and I find that the receipts of the nine provinces amount to something like $175,000,000. This would make a total dominion and provincial tax collection of about $450,000,000 or $45 per head as against $90 per head in Great Britain. If our revenues had been the same as the per capita revenue in Great Britain, we would have collected last year not $371,000,000 but $900,000,000, We would have had $400,000,000 or S500,000,000 with which we would not know what to do.


Mr. SANDERSON:: Is that a promise?


Robert James Manion: My hon. friends should
remember that while the population of Great Britain is only four times the population of Canada, the revenues of that country are fourteen times the revenues of this country. Even including the revenues obtained by the provinces, their revenues are eight times as large as ours. Until lately England was considered a free trade country, but her customs collections are six times the amount of ours. Her excise is fifteen times the amount of ours and her income tax, thirty times. They collect thirty times as much in spite of the fact that their population is only four times as great. We in this country know nothing about taxation when we consider the heavy methods employed in England. It is perhaps because of that that England is on the upgrade. I say to my hon. friends who criticize us for our tariff:	Is the business improvement in England because of free trade or is it because of the protection which has been afforded in the last couple of years? I am going to take the opportunity of quoting a few sentences of Mr. David Lloyd George, one of the few remaining members of the practically extinct species of free traders in England. The species is practically wiped out in this country except for the hon. member for Wey-burn (Mr. Young) who claims occasionally to be a free trader. I quote from the Montreal Daily Star of April 28 a cable from Mr. Lloyd George:
We were the first to slump. We claim that we are the first to recover. To what extent is this recovery due to our abandonment of free trade?
And again:
Every free trader would admit that, under the conditions in which the duties were imposed, they were '"bound to act as a powerful stimulant to home industries that were predominantly affected by foreign imports.
And again:
When the world crisis came the universal depression forced producers in every land to sell their goods at any price, wherever a purchaser was to be found. A country without a tariff became a favourite dumping ground. Our imports therefore tended to increase when we were offered goods we needed at the prices of bankrupt stock.
Our manufacturing enterprises necessarily suffered from this eruption of cheap articles. High tariffs arrested this process and home production was bound to benefit as long as the world slump lasts-*
These arguments apply to Canada just as well as they do to the United Kingdom; and in the same way it was just as reasonable for Canada to increase the tariffs of this country along certain lines, for the reasons outlined by Mr. Lloyd George, as it was for Great Britain.
To my mind, and I think in the judgment of all fairminded people in this country, this government has nothing to be ashamed of but much to be proud of. This government, sir, has brought Canada safely through an economic hurricane the like of which has never been experienced before, and, I am sure we all trust, will never be experienced again. The government of Canada now in power deserves, and I believe will get, the gratitude of the Canadian people when the time comes. Canada, as well as the world generally, is on the upgrade; all the indices point to this. Railway earnings, which constitute one of the best indices in any country, are on the upgrade in Canada. Employment has improved; farm and security prices have gone up; construction contracts have increased; automobile, steel, newsprint, lumber and power production have improved; clearinghouse records are higher, and export trade is gaining each month. I am of the opinion therefore that before the election in a year or so the people of Canada will reach the sunlit heights of full prosperity again, and when we go to the country my hon. friends opposite will come back to sit on the same side of the house as they did after the last election.


Mr. WILLIAM IRVINE (Wetaskiwin):: May I first of all extend my sympathies, with those of other members of the house, to the Minister of Finance (Mr. Rhodes) in the sad bereavement which he has experienced.
I have just listened to a very fiery and fighting speech by the Minister of Railways (Mr. Manion) but I am afraid I cannot enter
The Budget-Mr. Irvine

into his enthusiasm, at least to the extent that he did, in the defence of any administration of the present system or of^any attempt to make it operative. For a long time in this country, even up to the present moment, fiscal policy has been regarded by both parties as the secret of economic advantage or prosperity; that is to say, one party held that we could bring prosperity to Canada by raising tariffs, while the other party contended that we could bring prosperity by reducing them. We have now in office the party that believes in increasing tariffs, and they have been increased; and I am quite willing to admit with the minister who has just taken his seat that in the administration of affairs under a high tariff policy Canada is just as well off as any other country in the world. I do not think there is any question about that, but I add that there is no country in the world that is very well off at the present time. I would even go this far and say that so far as I am personally concerned, it seems to me that so long as we are going to continue with capitalism in Canada I would just as soon see the administration carried on by the present government as by any other government you could pick in the dominion. But I do say that I am opposed to carrying on the present system, and I do not believe that it is possible for any government to administer that system to the satisfaction of the common people.
The next point I want to bring forward is this. We have never had any experience with a low tariff in Canada. We have had low tariff parties but have never had any low tariff practice, so that we are left to guess at what would happen were we treated to low tariffs.
The main contentions of the opposition during this session have centered on two points, first on trade, involving of course the question of tariffs. The contention has been that trade means economic salvation; that tariffs when .they are high prevent trade; that if the Liberal party came into power tariffs would be lowered and we should get more trade, and therefore we should have economic salvation. The next point in their contention has been that the practices of this parliament and of this government have challenged the principle of representative government. These are the two main criticisms that have been advanced this session.
I would suggest that the abolition or the reduction of tariffs in Canada would not necessarily mean a healthy increase in trade. I have pointed out that we have had low

tariff parties and they have never put a low tariff into effect, so that I must deal with the speculative side of the argument, having no practical examples to follow. It may be readily admitted that the tariff is a barrier, but I contend that it is not the only barrier, nor is it the most important barrier. There is in the world to-day in every country what we may call a capitalistic surplus of goods; that is to say, there is a surplus of goods in every industrialized country of the world, over and above that which can be sold or bought at a profit price, and each one of these countries, not being able to consume at home the surplus of goods which machine production has made possible, enters into competition with every other country for the so-called world market, which has been diminishing all through the last century, and has . almost reached now the complete vanishing point.
The time has come when we must insist that the Liberal party, which in its campaign for power holds out promises to the people that it will bring prosperity through tariff reductions, should tell us just exactly how much it is going to reduce the tariff if and when it does come into power. We want to know not only how much the Liberal party intends to reduce the tariff, but on what goods, or whether it intends to reduce the tariff on all classes of goods, or intends to wipe out the tariff entirely. Then we want to know in which countries such proposed tariff reductions will secure for us a market, and for what sort of goods that market will be available. Further, we want to know to what extent that market will be open to us.
These are very practical questions and if insisted on all over Canada they may force the Liberal party, for once at least, to depart from the usual practice of generalizing and making vacuous statements which may be interpreted this way or that but are always interpreted in some other way than the way expected when the pinch comes.
Another point that I want to bring to the attention of the house is that when a nation is in debt, as Canada is, that nation cannot accept the responsibility of meeting its foreign obligations and at the same time ignore the tariff situation in the world as it is. The hon. Minister of Trade and Commerce (Mr. Stevens) dealt very ably with that point a few days ago. He argued

and I have not heard anyone who has challenged him on that-that a debtor nation must export more than she imports or she will have to default. Some have argued that we can be in debt

The Budget-Mr. Irvine
say to the United States, and export more to Great Britain, and eventually get a favourable balance in the United States indirectly through the clearing house system. But as things are to-day that cannot be done, because all nations have a surplus of goods for export, and nearly all nations are indebted to the United States and trying to do the same thing we are trying to do. I think we may readily concede this point to the contentions of the Liberal party, that goods shipped out of Canada in exchange for goods shipped in should not be subject to a tariff, these things may be, however, better arranged than by tariff policies of the old type. The C.C.F. proposes to arrange that in a scientific way through the appointment of a government board which will handle the export and import trade so that we shall ship goods out only to nations that are in a position to take our goods and give us goods in return or take our goods to apply on debts which we may owe them.
But there is a third point in connection with this contention that a policy of lower tariffs would bring economic prosperity to Canada, that is that, unfortunately for itself, the Liberal party has a record in regard to tariffs which does not inspire confidence. If that party can again prevail on the Canadian people to return it to power once more on the promise to reduce tariffs, after its long years of office in which no attention was paid to that question, then, of course, there is not much hope for democracy.
The next complaint urged against the present administration relates to the preservation of the principle of representative government. I think those who have urged that complaint, particularly with reference to some of the legislation advanced by the administration, have unfortunately mistaken the issue. I venture to say that financial monopoly has been and is a greater danger to representative government in this country than any act which was ever passed by this or any other government. But when the Liberal party was in power it had nothing to say against that financial monopoly, and even at this session of parliament not a word has been uttered that would indicate that they are in any way opposed to the financial monopoly which is in power in all countries. I would say that even the cat with the proverbial nine lives would have been dead long ago if it had been slain as often as the Liberal party affirms that responsible government has been slain in this house. I do not think that there is any reason at all to assume that the present Prime Minister and his cabinet are impairing the principle of
responsible government any more or any less than the government which preceded them.
Let me invite the attention of the opposition to the real challenge to representative government. I have already mentioned the dominating influence of finance, which is not peculiar to Canada but exists in all countries.
I want next to mention the action of the Liberal party itself, which is more dangerous to representative government in my opinion than any legislative proposal. While our people are in debt, while they are unemployed and discouraged, while we have many people in want, the opposition raises hair-splitting points about governmental and constitutional questions. I think that practice has done much to discourage the people of Canada in their belief in representative government, and that the more of that which goes on the less respect will be shown by the people for this house and its deliberations. Take the discussion on the marketing bill which has gone on for the past two weeks, let anyone read that discussion and then ask them how much respect they have for representative government. That is the sort of thing that is doing more harm to representative government than any marketing bill or any act which this or any other government has so far proposed in this house. The Liberal party has failed entirely to present an alternative and constructive program as a substitute for the program that is being carried out by the government in office. This government, however inefficient or ineffective it may have been in dealing with the depression, has at least at this session of parliament given an intelligent response to the situation.


Miss MACPHAIL:: They took a long time to do it.


William Irvine: As the hon. member says,
they took a long time, but at last they have made an intelligent response. I am not satisfied with that response, I think they should have gone very much further. Neither do I think, as I said at the outset, that this or any other government can under the present economic order prevent unemployment or poverty or debt. I do not believe that can be done by any group of men. I am quite satisfied that the solution cannot be found in any alteration of administration or any change of party or of government; the remedy lies deeper than that, in economic reconstruction on a basis which so far neither the government nor the opposition has seriously considered.
Let me point to a few major facts which concern us in Canada to-day and which should be the basis of our political and

The Budget-Mr. Irvine
economic policy in the near future. The first is the fact of abundance. That has been pointed out from this section of the house many times during the past decade. We have in Canada an abundance of goods and we can produce more. We have potential wealth and real wealth far beyond the ability of the people to purchase. In other words, although we have abundance, that abundance is not distributed. That leads us to the next fact, that devising measures to assure distribution of these goods is the first task of any administration. The third point is that financial reform is the first step to be taken in securing distribution of that abundance. We submit these considerations as the basis of a policy different from that now being pursued by the administration or hinted at in the campaign of the official opposition.
I beg, sir, in resuming my seat, to move, seconded by the hon. member for Red Deer (Mr. Speakman):
That all the words after "that" be struck out and the following be substituted therefore:
"This house, while appreciating the unusually difficult task of the government in attempting to administer the present system, regrets the undue delay in taking necessary steps leading to the distribution of our present abundance amongst the Canadian people."


Mr. J. C. MOORE (Chateauguay-Hunting-don):: 
Mr. J. S. STEWART (Lethbridge):: Mr. Speaker, the financial critic of the opposition, the hon. member for Shelburne-Yarmouth (Mr. Ralston) moved an amendment to the motion of the Minister of Finance (Mr. Rhodes) that the Speaker do now leave the chair and the house resolve itself into committee of ways and means. This afternoon I desire to direct attention to the first paragraph of that amendment. The amendment has been ruled out of order by Your Honour but there is no doubt that it expresses the fiscal policy of the Liberal party and is a public pronouncement made on behalf of that party. The first paragraph reads:
This house regrets that the proposals of the Minister of Finance give no indication of the intention of the government to abandon the policies of economic nationalism which have proved so disastrous to Canada's trade.


Pierre Édouard Blondin: I would remind the hon. member that the amendment was ruled out of order and therefore is not now before the house for discussion.


John Smith Stewart: Might it not be regarded as a pronouncement with respect to the Liberal party's fiscal policy? It is a public pronouncement made by one of the leaders of the party and I think it gives the people a correct idea of just how the Liberal party itself views the problems of the day. If that is right, then the Liberal party claims the policies of this government have affected the trade of Canada; and if we grant that premise, then it must be only fair and just to arrive at the conclusion that the fiscal or trade policies of the former government affected the trade and the markets of Canada. If, during the term of office of the Liberal party, of which government the hon. member for Shelburne-Yarmouth was a member, our
country lost markets for our agricultural products, then it is but fair to conclude that we were deprived of these markets through the policies of the then Liberal government. The former government must be responsible for any decline in Canada's trade as well as for the loss of markets during their term of office. Therefore I should like to direct the attention of the house and of the country to the lack of policy of the King government, to the lack of effort put forward by the Liberal government from 1921 to 1930 to hold for our farmers an export market for the staple product of the west, namely, wheat. If today we lack a market for our wheat, if any government be involved in the present wheat situation it is the government that held office from 1921 to 1930. The treatment of the wheat market problem by the former administration is a story of the lack of possession of knowledge of wheat market conditions by the members of the then government, or it is a story of the complete ignoring of those conditions, or it is a story of neglect of public duty. I think it is high time the people were told to what extent the King government is involved in our wheat problem, and of its method of dealing with this problem, which it dared not face. It is time we were told that the Liberal government did not perceive the problem and had no policy to offer for the situation. It is time we were told of a government that was weighed in the balance and found wanting in many respects, not the least of which was its attitude towards the wheat situation in 1930 which, as I say, it dared not face but left as one of the many questions to be passed on to the Bennett government for solution.
Our present wheat market situation can be explained only by reference to what transpired before 1930, and particularly by reference to the years between 1925 and 1930. From 1919 to 1925 the countries of Europe, which had been engaged in the war, strove to regain their pre-war production of food products, and by 1925 these countries were then working on a fairly normal basis. European agriculture was therfore fairly well established in 1925, and that continent presented a market picture much different from what was presented to the people, chiefly the exporters, a few years previously.
Canada being an exporter of agricultural products was vitally interested in and would be affected by any policies which might be initiated in Europe. But the King government did not appear to realize the significance
3066	COMMONS
The Budget-Mr. Stewart (Lethbridge)
of the policies initiated in the European countries, and certainly they made no attempt to warn the farmers of the wheat marketing problem which was bound to follow as the results of the policies initiated in 1925 in continental Europe.
Wheat, which is the staple product of western farmers, has for some years been Canada's greatest export commodity, and market trends in wheat have a profound influence on business conditions in this country. When we have good wheat prices business is good in Canada. The transportation of wheat has a direct influence on Canadian business, and the sale of wheat is the largest factor in our export trade. Any policies which might be put into operation which would affect wheat would be of vital interest to the people of western Canada.
From 1921 to 1930, eighty-five per cent of the world surplus of wheat was marketed in the importing countries of Europe but the outlook for that wheat market was greatly changed owing to the agricultural policies which were pursued by those countries in the first post-war years. I think the clearest picture of all can be presented through the trends in wheat acreages in Europe from 1921 to 1930, as will be seen in the following table:
Wheat Acreage-Europe (excluding Russia)
a pppo
1930	 72,000,000
1921	 63,000,000
Increase 1921-30	 9,000,000
These figures show that during the ten years of Liberal administration in Canada, from 1921 to 1930, there was an increase in wheat acreage in continental Europe of
9.000.	000 acres, or an average of nearly
1.000.	000 acreage per year; and to that one might add this fact, that in continental Europe they secure a substantially heavier yield of wheat per acre than is obtained in Canada and other exporting countries. Russia also had embarked on the first of her five-year plans and had announced to the world that she had adopted a policy to intensify her agricultural production through collective farming. The following table gives a report of Russia's activity in wheat:
Wheat Acreage-Russia
acres
1930	 80,000,000
1921	 50,000,000
..	30,000,000
In so far as world trade in this commodity is concerned, one can readily see that as a result of these acreage increases in wheat there would be dislocation of wheat trade channels. The following table shows the increase in European acreage, including Russia:
Total European Wheat Acreage (including Russia)
acres
1930	 152,000,000
1921	 113,000,000
Increase 1921-30	 39,000,000
This increase of 39,000,000 acres means an increase of more than one and a half times the present wheat acreage of Canada. This increase in acreage was highly significant, and a change in Canadian agricultural policy should have been put into operation to meet the changes in our wheat market which necessarily would follow. In our country the farmers were never advised what was going on in Europe. For this the Liberal government of that day must be held responsible. Canada's adjustment to the increase of European wheat acreage was to increase her own wheat acreage from 20-7 million acres in 1925 to 26-25 million acres in 1930.
Along with this great increase in wheat acreage in Europe there was another significant warning given to the Liberal government of the day in the price trend from 1925 to 1930. In the following table you will find the changes which took place in the average of wholesale prices and the average price for No. 1 northern wheat at Winnipeg for the years 19:25 to 1930:	"
Index of
Wholesale No. 1 Northern prices	wheat
1925	
102.6	109.81926	
100.0	100.01927	
97.7	99.01928	
96.4	90.21929	
95.6	89.81930	
86.6	63.0
The foregoing table shows the definite reaction of Canadian wheat prices as a result of increased European acreage. But the Liberal government paid no attention to those distress signals.
Concerning agricultural policies in Europe, in 1925 Germany and Italy announced the inauguration of a new agricultural policy which was definitely related to the increase in their wheat production. France followed with her announcement in 1927. The purpose of these
Increase 1921-30 

The Budget-Mr. Stewart (Lethbridge)
policies in these countries, which countries had imported a large amount of our wheat each year, could not be mistaken or misunderstood.
Germany in August 1925, revised her tariff in an effort to increase the intensity of German agriculture, and the exemption from duty of the most important agricultural products was abolished. Heavy duties were placed on imported live stock, and a duty of 32 cents per bushel was placed against imported wheat.
In Italy Mussolini in 1925 commenced his famous "battle of wheat," and inaugurated his new policy by placing a duty of 58 cents per bushel against imported wheat.
The 1925 policies of Germany and Italy were followed by France in 1927. In September of that year the duty on wheat entering that country was increased from 20 cents to 37^ cents a bushel.
These three countries, large importers of our wheat, adopted as early as 1925 policies which were designed, (1) to maintain domestic prices, (2) increase domestic production, and (3) limit imports from foreign countries. These policies which were put into operation in 1925 brought results in 1929. Through the increase of wheat acreage and through increased production brought about by the use of fertilizers and better methods of cultivation large crops were secured. In 1929 nature cooperated with Europe and they had a tremendous wheat yield. During the year 1929 and the first half of 1930 these three countries greatly increased their import duties on foreign wheat, as will be seen by the following table.
France-Increases
May,	1929-from	37c.	to	53c.	per	bushelJune,	1930-from	53e.	to	85c.	per	bushel
Italy-Increases
May,	1929-from	58c.	to	73Jc. per	bushelJune,	1930-from	73>}c.	to	86c.	per	bushel
Germany-Increases
Dec.,	1929-from	42c.	to	49c.	per	bushelJan.,	1930-from	49c.	to	62c.	per	bushelApr.,	1930-from	62c.	to	97e.	per	bushelThese increases in tariffs were supplemented by other restrictions, such as milling quotas. In December 1929, France established a milling quota providing that millers should use 97 per cent domestic wheat in their grist. In July 1929, Germany introduced a milling quota whereby millers were required to use 30 per cent domestic wheat. Italy followed with a similar policy. These mixing regulations have been changed from time	to time	to meet
conditions of supply and price levels.
The immediate effect of the import wheat duties levied by Germany and Italy in 1925 and by France in 1927 was to increase the domestic price levels in those countries, and we find that domestic prices were substantially higher than world prices. The following table shows a comparison of the prices paid for domestic wheat in Germany, Italy and France, with the price for imported wheat on the world market at Liverpool:
United Kingdom
imported wheat	Germany	Italy	France1925-26. .	.. 1.58	1.61	2.07	1.451926-27. .	.. 1.57	1.77	2.08	1.821027-28. .	.. 1.37	1.62	1.91	1.661928-29. .	.. 1.27	1.41	1.90	1.671929-30..	.. 1.20	1.65	1.90	1.47
The extent to which the domestic producer in these three countries was subsidized during these five years in raising wheat is seen in the following table:
	Germany	Italy	France
	cents	per bushel	
1925-26..	.. .. +03	+ 49	- 131926-27..	.. .. +20	+ 51	+ 251927-28..	.. .. +25	+ 54	+ 291928-29..	.. .. +14	+ 63	+ 401929-30..	.. .. +35	+ 70	+ 27
It will thus be seen that the domestic producer in Germany received a bonus as high as 35 cents a bushel, the domestic producer in Italy as high as 70 cents a bushel, and in France as high as 40 cents a bushel. The result of these high prices in these countries from 1925 to 1930 was a great stimulation of wheat production, with the result that by the end of the year 1929-30 the imports of wheat into those countries were definitely reduced. We as an exporting country have been and now are suffering from the results of policies which were initiated eight years ago. This is brought home to us by the fact that the major part of the decline in the world trade in wheat in recent years has been due to the reduced purchases of foreign wheat by these three countries. The curtailment of imports of wheat into France, Germany and Italy is the very heart of our wheat problem. Our average wheat export, including flour, over the ten years from 1923-4 to 1932-3 was
281.000.	000 bushels. Our average wheat export for the five year period from 1924-5 to 1928-9 was 310,000,000 bushels. Last year,
1932-3, our total exports amounted to
261.000.	000 bushels, including flour, made up as follows:

3068	COMMONS
The Budget-Mr. Stewart (Lethbridge)
Destination
1.	United Kingdom	
2.	Orient	
3 Other countries-
United States, B.W.I., 4. Continental Europe	
Canadian Exports-1932-33
Amount
bushels
	 103,000,000
	 12,000,000
etc	 10,000,000
	 115,000,000
Remarks
Largest in history-about 50% Normal
Normal
240.000,000
Flour exports	 24,000,000
Grand total	 264,000,000
With our flour exports it makes a total of 264,000,000. About fifty per cent of the total importation of wheat into the United Kingdom was secured by Canada in that year. But in 1927 France, Germany and Italy imported 225,000,000 bushels of wheat, whereas in 1932-3 their imports amounted to only 90,000,000 bushels. There was a decline of 135,000,000 bushels in the imports into those three countries between those years. Therefore had Canada but supplied her fair share of that decline, or about forty per cent of the 135,000,000 bushels, our exports would have been equal to our ten year average.
I desire to place on record now two tables, the first showing the duties imposed against our wheat when the King government came into office and the second showing the duties imposed when the King government was voted out of power:
Wheat Duties when King Government took office (per bushel)
Year	France Germany Italy
1921	 20c.	free	free
Wheat Duties when King Government left office
1930	 85c.	97c.	86c.
In addition, milling quotas were applied in 1929, which greatly restricted our wheat exports to these countries. The present government has been criticized for not being able to dispose of our surplus wheat, but the country should know that our wheat carry over commenced as far back as 1925 and gradually increased each year. The figures are as follows:
bushels
1925		 27,000,000
1926		 36,000,000
1927		 48,000,000
1928		 78,000,000
1929		 104,000,000
1930		 111.000,000

Canada will greatly reduce her carry over at the end of this crop year, and we would not have a carry over to worry about but for the legacy of unsold wheat bequeathed us in 1930 when this government took office. In
1929-30 the United Kingdom purchased large quantities of wheat from the Argentine, and in that year Canada only supplied thirty per cent of the United Kingdom wheat requirements, as compared with a normal importation of from forty to forty-five per cent from our country. But the story of Canada's exports of live stock products to the United Kingdom presents an even more tragic picture. I have here a table showing the cattle and bacon exported from 1925 to 1930, as follows:
Cattle	Bacon
(Numbers) (cwt. of 112 lbs.)
1925	
110,155	1,266,8611926	
79,083	863,4931927	
7,669	503,0841928	
405	306,7951929	
199,4661930	
5,193	99,298
During the ten years from 1921 to 1930, while the Liberal government held office, Canada lost another market for her agricultural products; that is, the United States. The loss of this market was due to tariffs imposed against our exports by that country. First we had the emergency tariff of May 27, 1921; then the Fordney-McCumber tariff of September 21, 1932, and finally the Hawley-Smocvt tariff of June 18, 1930. In 1921 we exported to the United States $190,000,000 of agricultural products; in 1930, the last year of the Liberal regime, those exports amounted to $92,000,000. So during the administration of the King government we lost a market in the United States for $100,000,000 worth of agricultural products, and the Hawley-Smoot tariff which was put into operation six weeks before this government took office completely shut out our exports to that country,

The Budget-Mr. Stewart (Lethbridge)
so that last year they amounted to only $6,900,000.
During the years 1921 to 1930 it has been shown that Canada lost a market for from fifty to sixty million bushels of wheat, in Europe and a market for agricultural products in the United States worth $100,000,000 annually, but the amazing thing about this debate lies in the fact that hon. gentlemen opposite say this government is responsible for the loss of our markets because of the policies we have pursued. If anyone is responsible for the loss of these markets surely it must be the gentlemen who were administering the affairs of this country when the tariffs were placed against us.
I should like to summarize the points I have	endeavoured	to bring	forward by statingthat	when the	Bennett	government	tookoffice	in August,	1930, it	was brought	face
to face with a serious condition in regard to our export markets for agricultural products.
1.	During the King regime Europe and
Russia had increased their wheat acreage by some	thirty-nine	million.
2.	High import duties and milling restrictions had been placed against our wheat by France, Germany, Italy and other countries.
3.	Wheat production in the countries I have named was heavily subsidized, so that our exports of wheat were sharply reduced.
4.	Under the Liberal government the wheat carry-overs increased from 27,000,000 bushels in 1925 to 111,000,000 bushels in 1930.
5.	In 1929-30 the United Kingdom, instead of purchasing our wheat in the usual quantities, bought Argentine and Danubian wheat.
6.	Our domestic wheat market was demoralized by the piling up of surpluses as the result of the undermining of Canadian export markets during 1925 to 1930.
7.	The market for farm products in the United States was closed, the last tariff changes being put into effect six weeks before the Bennett government took office.
What action was taken or what policy was pursued by the King government to meet this emergency in 1930? The Prime Minister of the day, in the speech from the throne delivered on February 20, 1930, said:
The dominion is already recovering from the seasonal slackness evident at the end of the year, and it is not to be forgotten that the bulk of the 1929 wheat crop still remains in Canadian hands for final disposition.
Evidently the right hon. gentleman felt that it was a great asset to have in storage 74726-194J
in Canada wheat for which we had no market and which we could not sell. Then on March 14, 1929, the Liberal Minister of Trade and Commerce said this to the country:
The Department of Trade and Commerce is not exercised over the sale of such commodities as wheat because those commodities find their own market; but we are interested in assisting the sale of manufactured products.
But listen to this: The then Minister of Railways and Canals, Hon. T. A. Crerar, at his nomination convention in Brandon, held on June 13, 1930, is reported as follows:
Mr. Crerar said the greatest factor in the present unemployment situation in Canada was the fact that in 1929 western Canada produced a smaller crop than in 1928. A normal crop of 500,000,000 bushels this year with other crops corresponding would end unemployment practically within six months.
I must acknowledge that a spokesman of the then government who attended the League of Nations meeting at Geneva did make a statement either in 1924 or 1926 that the government of Canada was one of the few governments in the world which had kept to lower tariffs at a time when other countries were raising tariffs against her. But when markets are falling away prompt action certainly is necessary. If the action they did take made it so that other countries increased their tariffs against us, then I say that on the face of it that action must certainly condemn them. This country has learned how easy it was under a Liberal government to lose markets, and the present government is finding out how hard it is to regain the markets previously lost.
What policies did the Bennett government adopt to meet these problems that had been left on its doorstep by the King administration? It might have followed the Liberal policy and done nothing but that would bring disaster to Canada in so far as her export markets were concerned. The other alternative, which was adopted by this government, was to face the situation fairly and see what could be done to help the Canadian people in this emergency. What was that policy?
First, an effort was made, and that policy is being followed at the present time, to restore confidence and stability to the domestic wheat market in Canada. The collective credit of Canada has assisted in maintaining an open and continuous market for Canadian wheat, and that in spite of a world surplus, and a Canadian carry-over. The farmer has been able to sell and get cash for every bushel of wheat he has hauled to market. Further,
3070	COMMONS
The Budget-Mr. Stewart (Lethbridge)
an aggressive policy to assist the selling of our wheat abroad was at once initiated, and with beneficial results. The following table shows
Year-
1929-	30	
1930-	31	
1931-	32	
1932-	33
1933-	34 (estimate)
the exports of wheat for the year 1929-30, the last year of the King administration, and the years which have followed:
Per cent
Canadian exports	Canadian export of
(million bushels)	total trade
1S6	30
259	33
207	27
264	43
200	36
We have sold each year more wheat than did our exporters during the last year of the King regime. Further than that, in 1932-33 Canada's shipments of wheat were 43 per cent of the total world trade, one of the largest percentages Canada has ever had, and a percentage which was surpassed only three times in the ten years when we were supposed to have free markets for our wheat throughout the world. Secondly, the domestic markets were secured for Canadian producers. Foreign produce was more or less shut out, and today we find that the prices received for agricultural products in Canada are away beyond the prices paid for the same products in the United States and in other countries. Then, in the third place, through the efforts of the right hon. leader of the government the Canadian farmer has been able to secure a market in the largest and most stable market in the world, namely in the United Kingdom. This has been secured for the farmers through the provisions of the Ottawa agreements, and through these agreements there has been an increase in the price of hogs and in bacon exports. To the principle of these agreements and the principle involved in the second reading of the measures to promote trade within the empire the Liberal party were opposed. I say that the results obtained through the operations of the agreements provide sufficient reasons why the public should refuse to repose confidence in the policies of the Liberal party. The people will continue to confide in and to repose confidence in the right hon. gentleman who now leads the Conservative party in this House of Commons, the gentleman who during the last four years and in the most troublesome times has presided over the destinies of Canada, a leader who stands among the greatest Canada has yet produced.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Mr. B. F. SMITH (Victoria-Carleton):: Mr. Speaker, the task of speaking in a budget debate is not easy under any circumstances, and when one finds himself compelled to follow so many notable addresses which have already been delivered in this debate and finds that so many phases of the budget have been exhaustively dealt with, it becomes increasingly difficult. It is not without some degree of hesitancy, therefore, that I rise to give utterance to some few thoughts that I have in mind in connection with this budget.
The task of preparing the budget is not an easy one under ordinary conditions, and under the abnormal circumstances in which we find ourselves in this country to-day it is much more difficult. I have often wondered as I have sat and listened during this debate whether it would be possible for any finance minister to prepare a budget which would be acceptable to everyone. Scripture tells us that the day shall come when the laws shall no longer 'be written in tables of stone, but in the tables of men's hearts. I fear that that day will not come until the millennium is with us, and the millennium will have to come before any finance minister in this country will be able to prepare a budget that is acceptable to all. When that time does come, Mr. Speaker, I hope that many hon. gentlemen whose faces I now see opposite will be permitted to remain in occupation of the opposition benches.
I think this much may be said of the present budget speech, that it is a complete statistical picture of conditions as they exist. In most budgets to which I have listened there seems to have been an inclination on the part of the one who prepared it to deal only with the more pleasant features, leaving aside those which were distasteful; but in this particular case I am forced to the conclusion that the

The Budget-Mr. Smith (Victoria)
finance minister has made an honest effort to give to the people a true picture of the country's affairs. The man in the street who can add and subtract can take this budget speech and determine for himself pretty nearly where this country stands.
The duty of any government in my judgment is first to gather in the revenues of the country honestly and to maintain the public services, and to make judicious expenditures that are necessary and in the interests of the well-being of its people. At the present time it becomes necessary for the finance minister in preparing his budget to keep his eye upon the labouring man, who is always worthy of his hire; upon the fisherman, who in his weeks and months of unceasing toil and hardship finds himself on many a day and night labouring and catching nothing; upon the miner, who igoes out to explore unknown territory in the hope of finding untold wealth; upon the farmer, who works early and late in order that he may receive some remuneration from his efforts and have some chance of giving an education and the necessaries of life to the family which he is bringing up. Nor should we forget those who are working in industry. We cannot pay too much regard to these people; for it is necessary and essential that the administration of affairs in this country be so conducted as to provide for the safe investment of wealth so that capital and labour can go forward hand in hand and bring happiness and prosperity and contentment to our people. With the wonderful natural resources that we possess I have no hesitation in saying that if these instrumentalities are bonded together, working in harmony and cooperation, there is no just reason why the people of Canada should not be made a happy and industrious and contented people.
At this particular time we require a government of great courage and determination. I think the very strongest opponent of the present Prime Minister of Canada (Mr. Bennett) will have to admit at least that he and his colleagues have displayed since their advent to power a quality of courage which is essential in the momentous and depressing period through which we have been passing. It does not take much of a man to propel a craft when the stream is smooth and he is running with the tide, but in the hour of danger when the tempest arises you need a man of courage, and fortunately for the people of this country during the past three
years we have had such a man at the head of affairs.
Do not let us forget, as so many are apt to forget, that this old world in the last few years has been in cruel agony. We have been pierced with such pains as never before. We have been pierced with social pains, with economic pains, and even with religious pains, and I submit, Mr. Speaker, that we in this chamber, the tried and trusted representatives of the people should try to set aside the prejudices that are so common to politics and by uniting on one platform endeavour to bring about a betterment of conditions in this country which we all love so much.
I said a moment ago that in dealing with his budget the Minister of Finance had been called upon to think of the labourer. I do not believe there is an hon. member in this house who is not sympathetic towards the man who starts out in the morning with a dinner pail on his arm to try to make an honest day's wage in order that he may educate his family, shelter them and give them the ordinary comforts of life. No doubt such a man fills a common position in life, yet after all in many instances the common positions in life are just as hard to fill as are the higher offices for which we sometimes find it very difficult to get men. I said that capital and labour should go hand in hand, and I cannot for the life of me understand a man who is anxious to accumulate wealth while all around him he sees nothing but poverty. I cannot understand a man who can be happy under such circumstances.
Then I speak of the fishermen along the Atlantic seaboard, the gulf of St. Lawrence and the western Pacific. This is a class which endures real hardship and danger. They toil long hours and in many instances for small remuneration. The constituency which I have represented either in the legislature of Neiw Brunswick or in some other capacity for the last thirty years is essentially a farming and lumbering constituency. It will be seen that I started my political career when I was rather young, as I am only a youngster yet.
I should like to submit another matter to this house, if I may be permitted to refer again to myself. A great deal has been said about by-elections and what they indicate as to what might happen in the future. The hon. member for Gloucester (Mr. Veniot) will remember that in 1927 a by-election was held in my constituency in which a Liberal was elected by acclamation. Two years later the people asked leave to test the constituency and the result was that I was returned to this

The Budget-Mr. Smith (Victoria)
house with the largest majority ever accorded a Conservative candidate. It might be said that by-elections are not a fair index of what the people have in their minds, and I think the hon. member for Restigouche-Madawaska (Mr. Michaud) will bear me out in that statement. The victory attained by the hon. member who is now sitting in this chamber was not one to be wondered at. That constituency has always been Liberal. If hon. members will look up the records they will see that for the last ten or fifteen years the Liberal candidate in the county of Mada-waska has received almost three votes to every one received by the Conservative candidate.


Mr. DUPUIS:: They are intelligent people.


Benjamin Franklin Smith: Even
though there may be a sort of buoyant hope in the minds of hon. gentlemen opposite; even though they may find it necessary to capitalize on this period of depression through which we are passing in order to try to gain the good will of the electorate, I question very much when the time comes for the people to sit down and think seriously on the question whether they will place their confidence in a party which has no policy to submit to them. I shall touch upon this feature later in my remarks,
I stated a moment ago that my constituency was a farming constituency. It runs for a distance of about 150 miles along the international boundary. The principal cash product grown in the constituency is potatoes. Under normal conditions the potato crop of the maritime provinces is valued at about 114,000,000, or twenty-five per cent of the total crop produced in Canada. The former markets for our table stock were the island of Cuba, the United States and the provinces of Quebec and Ontario. These provinces bought freely from us because of the superior quality of the product grown in Prince Edward Island and New Brunswick. But these markets were closed during the years hon. members were in power. The market in Cuba was closed to us by reason of the high and abnormal duties placed against this product in 1928 or 1929, shortly after a treaty agreement was made with the British West Indies by the former Liberal government. That treaty precluded the possibility of any arrangement being made with Cuba under which we could enter into reciprocal trade relations which would absorb the surplus potatoes grown in Prince Edward Island and New Brunswick. There are those who say that the present government is mak-
[Mr. B. F. Smith.1
ing no serious attempt to gain access to the Cuban market but if these people knew the facts as they should, they would realize that it is impossible to negotiate with Cuba while the treaty exists between Canada and the British West Indies. I do not say that that treaty was wrong, nor am I stating that the government of that day did wrong in negotiating such a treaty; I say that it was the means of shutting the door absolutely and making it impossible for us to trade or negotiate with a country which had been buying a large part of the surplus table stock of Prince Edward Island and New Brunswick.
I am rather surprised at the attitude taken b>' the Liberal members in this house with regard to the farmers. I think it can safely be stated that ever since I came to this house in 1930 the Liberal party has opposed most strenuously every bit of legislation which was brought forward in this chamber to open wider markets for the agriculturists in this country. I mention first the Ottawa agreements. Those agreements were consummated after very careful thought on the part of representatives of all the countries of the British Empire who gathered here and sat around a table for days and weeks; men who were sent here, supposedly because they possessed that degree of intelligence which would qualify them for the duty they had undertaken; men who had a thorough understanding of the conditions prevailing in the different parts of the British Empire which they represented. After most careful thought and deliberation and, as well, in a spirit of cooperation they entered into certain agreements which they believed would enure to the benefit of the British commonwealth of nations.
Now what did we find on that occasion? The liberal party in this house most strenuously opposed those agreements. In spite of the fact that they had been passed in the British House of Commons in a very short time, the Liberal party in this country opposed the agreements, led by the present leader of the opposition (Mr. Mackenzie King). I say this with all due respect to the right hon. gentleman-and I do respect him, I must say. I respect him because of the position which he has held as Prime Minister of this country and because of the position which he holds to-day as leader of the opposition, which is one of great responsibility and not an easy one to fill. But I do say that he and his party had very little vision when they attacked the Ottawa agreements, which were entered into, after very careful deliberation with the

The Budget-Mr. Smith (Victoria)
object of benefiting the farmers, of benefiting the lumbermen, the fishermen, the fruit growers and other producers all down the line. One could go on enumerating the different avenues of trade which these agreements were intended to assist. Yet the Liberal party strenuously opposed the agreements, and the leader of the opposition has gone so far as to say on different occasions that if the time ever should come-and heaven knows that I for one hope it never will come-when he is returned to power he will destroy the agreements. In view of the great benefits which we have derived from them in the short time that they have been in force, and what they have meant to the different industries of this country, I challenge hon. gentlemen opposite to take that ground and maintain it when the time for an election comes.
Let me give you some of the words uttered by hon. gentlemen, for I have copied them from Hansard. The leader of the opposition said on one occasion that the agreements constituted a tariff wall around the empire. It was a "Tory conspiracy"; it was undeserving of any support from any quarter. Now what will be the attitude of the right hon. gentleman when it comes to a general election? Let me tell him that he can no longer go into British Columbia and preach one doctrine, into Ontario and preach another, into the maritimes and preach still another. The day has come when men can be heard everywhere over the radio; thank God for that. From one end of the country to the other we can hear the policies they are enunciating in any part of Canada and for which they are asking the support of the people. Well, the leader of the opposition claimed that the treaties were undeserving of any support. But while he was making this declaration, what did the ex-Minister of Agriculture (Mr. Motherwell) say about them? He declared, as you will find if you will look at Hansard, page 352 of the session 1932-33, that we on this side of the house had "swiped the Liberal policies in broad daylight," to use his own words-and this although the leader of the opposition had just said that the policies embodied in the trade treaties were a "Tory conspiracy." When the vote was taken the ex-Minister of Agriculture voted against the treaties notwithstanding that he had uttered the words I have just mentioned. And the hon. member for Yorkton (Mr. McPhee), who gave us such a wonderful dissertation on the budget a few nights ago-


Mr. BROWN:: Wonderful is right.


Benjamin Franklin Smith: Yes,
"wonderful" is right. Perhaps the thing he dwelt upon most was the red blood that came
in free of duty. He did not refer to the tariffs placed against Canada by Italy, Germany and France while his government was in power. He did not refer to the duties imposed against potatoes going into the island of Cuba. He did not refer to the Hawley-Smoot tariff, which practically amounts to an embargo against potatoes going from Canada into the United States. He did not refer to these matters of major importance, but he did discuss a few trivial things that might possibly catch the ear of the house and of the electors of his own constituency.


Vincent Dupuis: He did not refer to fifteen
cents a bag potatoes either.


Benjamin Franklin Smith: The
hon. member for South Perth (Mr. Sanderson), speaking of the agreements, said that there was nothing in the treaties to give any consolation to the*people of Canada. That was very mild for that hon. gentleman- "nothing in the treaties to give consolation to the people of Canada." But let me go on. The genial doctor who sits in the back seat representing Wellington (Mr. Blair) said that now that he had seen the schedule farms would be for sale because there was nothing in the treaties to help the farmer; and the equally genial member for Vancouver Centre (Mr. Mackenzie) declared that the concessions given were vague and illusory. Let me say to my hon. friend that even though the concessions granted might be vague and illusory, it is interesting to look at what has resulted from them. Let me tell him what the result has been. We have had, during the eleven months from April 1, 1933, to February 28, 1934, as compared with the same eleven months in the previous years, an increase in exports to the British Empire of 21 per cent. To the United Kingdom the increase was 20 per cent; to Australia 54 per cent; to British South Africa 61 per cent; to British India 44 per cent. Along with these increases go large increases in exports to foreign countries.
It will be recalled that during the discussion of these treaties it was said that they would make it absolutely impossible for us to mainr-tain our export trade with foreign countries; yet I find that there is a considerable increase in exports to foreign countries, because they are fifty-one per cent higher than they were a year ago. This establishes that the claim of the Liberal party that the treaties would prevent trade with other countries is also wrong.
I think the time has come when every good Canadian is anxious to buy more from the British people and to sell more to them, and

The Budget-Mr. Smith (Victoria)
our import trade is also growing. Compare the imports for February 1934 with those of the corresponding period in 1933. What is the result? Even from foreign countries there is an increase of 41 per cent. From the United States there is an increase of 43 per cent; from China an increase of 31 per cent; from Japan an increase of 39 per cent; from Germany 51 per cent, from the British Empire 45 per cent, from the United Kingdom 41 per cent, from British India 114 per cent, from Australia 182 per cent., and from New Zealand 102 per cent. Thus it will be seen that not only have our exports increased but our imports have increased as well under the trade agreements entered into in Ottawa two years ago.
I think it may safely be said that an honest attempt has been made by the present administration to solve the problem of wider markets. Yet we have had opposition to the marketing act, which I trust will soon become the law of this country. From the very day that bill was introduced it has been met with opposition of the most flagrant kind. Let me say as one who has been engaged in exporting produce on a large scale for the last thirty years, one who has been associated with the shippers of New Brunswick and the New Brunswick Potato Exchange, that many times during that period have we felt the urgent necessity of legislation of this kind to make it possible to carry the products that the farmer was raising and ensure orderly marketing of those products. What are the objections tq this act? In the first place it is urged that it involves compulsion. Well, if the compulsory features were taken out of this bill I would not give a five cent piece for it. Then it is said that these things should be submitted to the House of Commons. We have had the House of Commons here ever since confederation, we have had opportunity to submit to the house questions affecting the farmers, and how far have we got? Hon. members have talked about agriculture being the backbone of this country, but how far have they gone towards assisting agriculture? We assist the railways; we do all we can for the insurance companies and all the rest, but I charge that we have left the agriculturist alone; the attention we have given him on most occasions has been mostly lip service. Now this government have grasped the situation; they have brought down a bill, and placed it before the members representing the farming constituencies. I ask hon. gentlemen opposite how many letters they have received from their con-[Mr. B. F. Smith.!
stituents taking them to task because of the opposition they have offered to this measure; it would be really refreshing to know. It may be that they will have to face the farmers. Let me say that I shall be proud to face my constituents if the time ever comes again, and show them what this government have done and are doing in an honest effort to relieve the distressed condition in which the farmers have found themselves in recent years. We hear a great deal about the distress of the farmers; let me tell you that the farmers in my constituency have been fighting with their backs to the wall for the last few years. They have had a hard time to keep their farms, pay the interest on their mortgages, pay their store bills and keep their families alive. They have not complained very much; they have not asked for bonuses. As far as bonuses are concerned I am opposed to the principle from first to last. I do not believe it should ever have been adopted in this house. Most of the provinces are opposed to that system. The lowering of freight rates to assist the farmers is all right, but when it comes to bonusing any article or commodity of which there is already a surplus it simply stimulates production and the condition is aggravated rather than helped. 1 trust that the time is past when governments will resort to bonusing any article of production, at least any of which we have a surplus.
Yes, our farmers have been fighting with their backs to the wall. We have in my constituency a good many farms that are mortgaged, and the men on those farms find it difficult to pay the interest on the mortgages. Some have borrowed money from the Canadian Farm Loan Board. The Canadian Farm Loan Board was instituted in 1929. The government made available to them 85,000,000 to lend to farmers, and laid down the terms on which loans should be made. I have in my files a list of the loans that have been made by that board since its inception. It is a striking thing that during the last year the loans number just about half as many as in the year before. I have only the statistics to March 31, 1933. I should like to place these on record so that my constituents at least will have an opportunity of seeing what has been done through the Canadian Farm Loan Board. The figures are as follows:
	Total number
	of loans
1930			 1.965
1931			 ] .458
1932			 1,049
1933			 536

The Budget-Mr. Smith (Victoria)
I know that it is a difficult matter to lend money on farms, with due safeguards. The utmost care should be exercised in making these investments. But there are provincial boards; every province passed enabling legislation to work in conjunction with the Canadian Farm Loan Board. These provincial boards appoint a superintendent or an inspector, and when an application is made by a farmer an inspection is made and a report sent to the provincial board, which in turn sends its report to the dominion board. I regret to say that during the last year or two, when the farmers of my constituency were really crying for assistance at a time when it meant to them holding their farms rather than losing them, and when they were prepared to offer satisfactory assurance that loans would be paid, the security being more than one hundred per cent, really three times the amount of loan they asked

notwithstanding all this, loans were not available. Let me give an illustration. I know one man who asked for a loan of S600 on a property that under the worst conditions would bring S2,000, and he could not obtain it. I know several instances, which I shall not take the time of the house to cite, in which the Canadian Farm Loan Board has turned down applications for loans from New Brunswick and from my constituency. I am glad to know that the government is bringing down legislation of some kind to help along this line, which shows that this administration is fully alive to the necessity of doing something tangible to assist the farmers, being the first administration to do so in the history of this country. What the farmers want is not money at seven or eight per cent interest; they want to be able to borrow money at reasonable rates, and if the banks can get money from the people at 2 or 2i per cent they ought to be willing to lend that money at one hundred per cent profit at the most. The farmers are the people who should get the benefit of that cheap money, and until they do get that benefit I am satisfied that we shall continue to have deficits on our railways, relief bills and all these other things that would be adjusted if the agriculturists were given a fair chance to obtain that which is their due for the products they produce.
I do not want to refer at length to the tariff, but I- should like to say a word in that regard. Just a few nights ago in this house the hon. member for Prince (Mr. MacLean) and the hon. member for Weyburn (Mr. Young) took the government to task because they had not relieved the farmers by removing the duty of ten per cent on fertilizer.
Let me tell those gentlemen what that ten per cent means to the provinces of New Brunswick and Prince Edward Island. We have one plant in East Saint John, operated by the International Fertilizers Company, which covers nearly four acres of ground. Six weeks ago they had a million dollars' worth of chemicals in that building, twenty-seven thousand tons of fertilizer ready to go out to the farmers of Carleton and Victoria counties and even of the state of Maine. Yet these gentlemen would have us remove that ten per cent duty and have that fertilizer mixed in Baltimore, where it was prepared before the ten per cent duty was imposed. The plant to which I have referred gives employment to a large number of men in Saint John; it is one of the most up to date plants in the world, and obtains its chemicals from many different countries. They go to Germany and France for their potash; to Chile for their nitrate of soda; to the United States and the Netherlands for their phosphate, and their sulphate of ammonia is secured in Europe as well. So you see that this is a cosmopolitan establishment. Steamers come there from time to time bringing these ingredients which enter into the manufacture of our fertilizer; the railways are given freight, and we supply not only the people adjacent to that plant but also many people in the state of Maine. If the ten per cent duty were taken off, you would find that the fertilizer would be mixed in the United States, where it was mixed before that duty was imposed.
Let me say further that when the mixed fertilizer came in from the United States it was very difficult for the farmer to know the exact value of that fertilizer, and whether it was composed of the ingredients indicated upon the bag. Now we bring in the chemicals; we mix them there by an up to date mixing process, by which they are thoroughly blended. The fertilizer is dried and put into bags, and shipped out to different parts of the country as well as to the United States. They also have a plant in Prince Edward Island, and this industry means a great deal to the farmers of that province. In the first place they know exactly what they are buying, and they do not pay $75 or $90 a ton for it, as they did originally. The ingredients are brought to Saint John and compounded there; the farmers have an absolute guarantee as to what they are getting, and they buy that fertilizer for $25 a ton.
In conclusion, Mr. Speaker, may I say that a great deal of fault is found with this government by hon. gentlemen opposite.


Some hon. MEMBERS:: Hear, hear.
The Budget-Mr. Harris


Benjamin Franklin Smith: A great deal of fault is found with the Prime Minister.


Some hon. MEMBERS:: Hear, hear.


Benjamin Franklin Smith: His opponents say he is an autocrat and a dictator.


Some hon. MEMBERS:: Hear, hear.


Benjamin Franklin Smith: But I will say this, and I wonder if they will say "hear, hear". He is also a man of courage, and when the time comes I believe the thoughtful people of this country will say that he has not tried to do that which is expedient but rather that which is right. He is a real Canadian, a true hearted imperialist, and no better, nobler tribute could be paid to any living Canadian.


Mr. J. H. HARRIS (Toronto-Scarborough):: 
Mr. SPENCER:: Would the hon. member
state what commodity was sent to Great Britain?
The Budget-Mr. Harris


Joseph Henry Harris: Yes. The commodity was the leather scrap which is trimmed from hides when the hides are tanned and used for leather of all kinds. There is the pate, the snout, the lip, the ear, the dew claws, the shank pieces and the sinews. I could go into more detail if I were in another place. These commodities are used in the manufacture of photographic film, and that is what I had in mind in the remarks I made. The production in Canada of these raw materials amounts to nineteen million pounds a year, the consumption in Canada about thirteen million pounds a year, and the waste which is now being burned as fuel under boilers or being thrown on garbage dumps, and so on, approximates seven million pounds a year, to my knowledge. That is in answer to the hon. gentleman's question.
I was saying that the physical volume of trade is increasing in Canada. We are also pleased to note that the unemployment figures are getting less and less. I should like to put on record the figures of the international labour office showing that Canada has had a gain in employment of 21 per cent, Japan 11 per cent, South Africa 11 per cent, Sweden 2 per cent, France and Switzerland a decrease each of 1 per cent, Great Britain an increase of 7 per cent. In the United States they have had an increase of 26 per cent. I am very glad to see that increase in employment in the United States. Like others I am very anxious to see that great country prosper and go ahead even with their experimental policies such as the N.R.A.. the A.A.A. and their various codes. It is vital to Canada that the United States should prosper, because we are a population of ten millions living alongside a population of 120 millions. No matter what happens over there we realize that it must have its reaction over here. But, Mr. Speaker, I like the Canadian way of going about the reconstruction of our economic system. We could not afford to carry on the experiments that they have been trying. We have been relying on our experience. We have not shaken the traditions of our people or tried to remould them into	some new form in order	that	we mightlive	and work	out our economic	salvation.You	might say	that we have	just	let thingsdrift. Whether	we did or did	not,	it was far
safer for Canada to travel along the line of experience in the last few years than to launch into a system of experiments such as are being tried on the other side of the line. I am not criticizing the N.R.A., but I have seen the trend of Canada's business shut off from the markets of the United States by the tariffs 
of which my hon. friend spoke. I shall not enumerate them now. But I have seen Canada, a people of ten millions, cut off from a market which they had been supplying to the tune of many millions of dollars, and yet we have survived.
We have been criticized for negotiating a treaty with the motherland. Before I am through I am going to try to convince the house that that treaty was really worth while. I started out to say that we have stuck to the old lines of experience and tradition in the conduct of our affairs. We have avoided launching on such gigantic experiments as are being made on the other side of the line, and what has been the result? While they have their six hour day and their codes and all that sort of thing, the figures up to date show that they have not met their unemployment problem to any greater extent than has Canada. The physical volume of our trade has improved much faster than that of the United States in proportion. We have much less distress in industry in Canada than they have in the United States. Above all, the one factor which has made it possible for Canada to come through this time of stress and strain has been the imperial preference pacts.
The government in power to-day is the poorest group of advertisers that I have seen in this house since I came here twelve years ago. They do not seem to have any idea how to tell the people of Canada what they have really done for this country. They are very poor advertisers, and I say to them now that it is their duty and that of the Conservative party, as I see it, to tell the people of Canada what they have really done during the last three years.
This government has not only maintained the price level but raised it, and it has stayed away from inflation. It has raised the price level by 13-4 per cent in one year, and may I sound a note of warning at this point. In England the price level has been raised by 9-2 per cent; in Canada by 13-4 per cent, and I think that is fast enough.
One satisfactory feature of the rise in wholesale commodity prices in the last twelve months has been that the most of it has taken place in agricultural products. The average rise in agricultural products has been 35 per cent. One product in particular has been spoken about very much in this house; I shall therefore say just a word or two about it. I refer to the hog industry. For the last twenty years there has come to my office

The Budget-Mr. Harris
every morning a full report of what is happening in the Chicago market. Day after day during the last two years I have observed the slaughter of sows and little pigs that are not desirable for edible purposes, until the time was reached when sixteen million were slaughtered and thrown, you might say, into the ash heap. Yet in spite of that, each morning when I picked up the Chicago market reports I see that hogs are selling on the Chicago market and on the twelve western markets at from $3.40 to $3.70, $4, $4.10 and $1.30 per hundredweight, while in Canada the price of hogs has risen in one year from four cents a pound to eight cents.
I wonder if the hon. member for Yorkton (Mr. McPhee) is somewhere around the house. Perhaps someone will send a page after him because I am going to say something in a few minutes that he will not think is very kind of me. I will say it now. When that hon. gentleman in a speech in this paper says that not a farmer in Canada has got a copper out of the imperial trade agreements, surely he is stretching the point a little. If the farmers on this side of the border are getting eight cents a pound for select bacon hogs while farmers on the other side of the line are getting only four cents, surely those extra coppers are .going to the Canadian farmer. That shows that the trade agreement has been worth while, and surely my hon. friend from Yorkton is far from the mark when he says that not a farmer in Canada has got a copper out of the imperial trade agreements. I am going to touch further on these trade agreements when he gets down to the chamber if somebody will send for him.
In the meantime, Mr. Speaker, I want to say something about expenditure. Ten years ago, speaking from the other side of the house, I made some suggestions with regard to the .cost of running this country. At that time I thought that we had too much government in this country. I feel the same way about it now. We have too many members in our municipal councils. We remedied that in Toronto during the last year by reducing our city council by nine. We have too many members in our county councils, We have too many members in our provincial legislatures. We remedied that in Ontario by reducing the numbers by some twenty odd. Ten years ago, in 1924, at page 204 of Hansard, I made the observation that I had the pleasure at that time of representing
110,000	constituents. To-day I represent only
80,000. The constituency was cut in half and later increased to 80,000 constituents. I made the suggestion that I was quite willing to endeavour to represent 100,000 constituents in this house. The civil service has been cut by 12,000, in addition to the salary deductions, and if we cut the representation in this house by half we would still be able to govern the country fairly well. When the British North America Act was passed we did not have the radio and there were no automobiles. To-day we can travel ten times as fast and reach a hundred times as many people with the same effort. A number of hon. members could do twice the amount of work they are now doing while a number are doing twice the amount they ought to do. If hon. members would cut out half the drivel they send out of this building and stop half the agitation that is being raised in the minds of their constituents; if they would work full time and serve twice the number of people, we would not be stirring up the people half as much. I am quite serious in this. We are far away from the old days of confederation, and I think there is a great possibility of cutting down the cost of government. We should try to get the people to stop leaning so much on the government. A good deal of the correspondence which goes out of this building is caused by our constituents thinking that the government can do something for them. Individual enterprise and a little sand and backbone will do more for a man than can any government. If I may be pardoned for repeating, with our motor cars and our radios and so on, with the possibility of contact with our constituents, I think each hon. member could represent twice the number of people he is now representing. We would not be bothered with the amount of correspondence with which we now have to deal and the people would not be leaning so heavily on the government.
I think we are all pleased with the trend taken by our trade balances. This balance was unfavourable by $100,000,000 in 1930 while in 1934 it is favourable by $150,000,000. I do not intend to reiterate what the hon. member said just now with regard to the increase in our trade with Great Britain, but inasmuch as the hon. member, for Yorkton (Mr. McPhee) is not yet in his seat, I intend to answer his remarks and he can read it in Hansard to-morrow. He said that not a farmer in Canada has got a copper out of the imperial trade agreements. There are a little more than 10,000,000 people on this side of the water while there are 45,000,000 in Great Britain and 300,000,000 in India. Our trade
The Budget-Mr. Harris

last year increased to the tune of $50,000,000. What was that trade in? Do the farmers of this country know that Canada stands first in the British market with wheat, wheat flour and raw apples? Are these farm products? She stood first in hewn hardwood, zinc, patent leather and rubber boots and shoes. She stood second in oats, hams, live cattle, cheese and manufactured tobacco. Are these farm products? She stood second in sawn hardwood, copper and lead and writing and printing paper. She stood third and fourth and fifth in bacon, canned salmon, hewn softwood, sawn softwood, undressed leather, barley and wrapping paper. My hon. friend has said "not a copper," but I am going to try to illustrate how the imperial preference worked out for Canada last year. He does not seem to understand this matter of dollars and cents so I shall try to illustrate it in another way. The hon. member for West Lambton (Mr. Gray) had something similar to say in this connection. In case he does not understand it, I will try to tell it to him in another way. Before I do so, I should like to read a letter I received from Mr. Coats, the dominion statistician. This is dated May 10, 1934, and reads:
In reply to your letter of May 9, the lumber exports which you quote are correct, as are also your deductions.
Here are my deductions. With the excess of lumber shipments last year over the year before to Great Britain you could build a twenty foot board fence reaching from Halifax to Vancouver. If the same excess were used in constructing a wooden sidewalk made of two inch planks, ten feet wide, it would reach from the Atlantic to the Pacific. I ask the hon. member for Yorkton if he can understand that. The shipments of apples under the imperial preference increased from 1,530,640 barrels to 2,983,143 barrels, an excess of 1,452,503 barrels. If a raft were constructed of barrels five in a row and placed on the Ottawa river, it would reach from Ottawa to Montreal. Perhaps the hon. member for Yorkton knows what a raft looks like when it is five barrels wide and reaches from Ottawa to Montreal. That is what the imperial preference did. A steer is anywhere from seven to nine feet long from head to tail, depending upon whether the tail is down or straight out. Shipments of steers to England have increased from five to twenty to fifty-five thousand per year with the help of the imperial preference. If the excess of steers shipped last year over two years before were tied head to tail they would reach from Ottawa to Mont-
[Mr. Harris. 1
real. If the excess shipments of eggs shipped last year over the year before to the United Kingdom were laid side by side they would reach from Ottawa to Halifax. My hon. friend does not understand what a copper is but perhaps he can gain some idea of the magnitude of this shipment of eggs. We have about 22,000,000 laying hens in Canada. If they were placed on this ten foot sidewalk, they would reach from Atlantic to the Pacific. If a gun were fired and they all got the notion and laid an egg at the same time, we would have the number of eggs shipped last year to Great Britain in excess of the number shipped the year before. I see the hon. member for Yorkton has not come in yet. I am trying to talk in his language, because being a lawyer he does not seem to understand what dollars and cents mean. If the cans of fruit and vegetables shipped last year in excess of the year before were placed end to end they would reach from Winnipeg to Halifax. If the copper shipped last year in excess of the year before were made into ordinary No. 14 Browne and Sharpe gauge wire, the ordinary commercial copper wire, it would make 2,074,848,000 feet of wire. It is
25,000	miles around the earth, and this wire would go around fifteen and a half times. Bacon moved from twenty, to fifty, to eighty-three million pounds. Now, if you took all the hogs which it would require to produce that bacon and put them into one corral our friends on the opposite side of the house could not possibly, during the next ten years, make as much noise as they could. If you took that same bacon in the form of breakfast bacon you would have a ribbon of rashers that would go around this world five times. Perhaps my hon. friend from Yorkton does not know anything about coppers, dollars and cents, but at least he will have some idea of the magnitude of this imperial preference, in view of what I have said.
Fifty years hence when some of you young chaps are still here-and I hope the lady member will still be here-you will read in history that in a country called Canada there had been some great achievements. You will read that an act of confederation was passed in 1867 and that later on a national policy was instituted. Still later in a great war Canada did some great things for her mother country, and a little later on in the years 1931, 1932 and 1933 certain trade agreements were initiated with that country. These will be the high spots, and there will be recorded the names of a few men. There will be Macdonald and Cartier, and probably there will

The Budget-Mr. Euler
be mention of the name of Laurier, the man who perpetuated the national policy. History will also record the fact that some speeches were made by some hon. gentlemen opposite who called themselves Laurier Liberals-not Hepburn Liberals or McQuibban Liberals or even King Liberals. It will also be recorded that other people made speeches-people who liked to call themselves Bennett Conservatives. And along with these achievements history will record the names of certain statesmen, among which there will be, in a bright and high spot, the name of the Right Hon. R. B. Bennett.


Hon. W. D. EULER (North Waterloo):: I am sure my hon. friend from Toronto-Scar-borough (Mr. Harris) will forgive me if I do not reply to his original arguments so picturesquely expressed. I had no intention whatsoever of participating in the budget debate, and I speak only now because of a certain sense of duty that someone in this house should make a protest at the persistent and continual attacks that are being made not only upon the late government, but also upon the memory of a man who has passed away, with regard to the national railways.


Cameron Ross McIntosh: Let the dead past bury its dead.


An hon. MEMBER:: You would like to bury it all right.


Cameron Ross McIntosh: It will bury you.


William Daum Euler: As a believer in the public ownership of the national railways I have always felt that they should be kept out of politics. My good friend the Minister of Railways (Mr. Manion)-I say that sincerely and I think he will take it so-and others, both in this house and in previous meetings of the parliamentary committee on railways, have persistently made charges of extravagance with regard to the railways not only against the King government but against the late Sir Henry Thornton. These statements at the time were perhaps not refuted by some of us as strongly as they should have been. We had a motive in that. For my part I always felt that the attacks that were being made on the railways were made by some at least to discredit public ownership and by others for reasons which I need not give here.
As I say, I have always felt that the railways ought to be kept out of politics if they were to be made a success, and if apparently I trench upon politics the fight is not of my making, because politics was introduced into the debate this afternoon by my friend the Minister of Railways.


Robert James Manion: No; it was introduced by a number of others who preceded me, the hon. member for Shelburne-Yarmouth (Mr. Ralston) among them.


William Daum Euler: I should like the house to bear in mind that, after all, the constituent parts of the Canadian National Railways as they are now, were taken over by a Conservative government, and the heavy liabilities which we are now carrying, and the heavy interest charges which we find it almost impossible to pay, are the direct result of that action of a Conservative government in taking over the railways some years ago.


Mr. BELL (Hamilton) :: You were nine years in power; why didn't you stop it?


Cameron Ross McIntosh: That is a part of history; you cannot deny it.


William Daum Euler: I would point to a statement I made in the house, quoting from Hansard of a good many years ago, when the railways were first taken over, when the right hon. gentleman who is now Prime Minister (Mr. Bennett) said that at the time the Canadian Northern was taken over by the government it should have been allowed to go into the hands of a receiver and taken over at a fair price. Perhaps he was right, but apparently his party did not agree with him. But if this had been done, then probably two or three or four hundred million dollars of obligations on which we are now paying interest would not be a burden on the people.
What did we acquire in these railways? We acquired a conglomeration of four so-called railway systems-the Canadian Northern, the Grand Trunk Pacific, the Grand Trunk Railway and the Intercolonial Railway, which we had already had. I call it a conglomeration of railway systems. Then just as they had been taken over the Liberal party came into power, and they chose Sir Henry Thornton for the great task of welding these railway systems into one great system capable of competing with the Canadian Pacific Railway. I leave it to every member of this house and to the people of this country whether the work he undertook was not a colossal task. He had the duty of coordinating these different railways into one great system. He had to buy a great deal of rolling stock, because on most of the roads the rolling stock was quite insufficient. He had to buy heavier motive power, larger locomotives; bridges had to be rebuilt; and heavier rails had to be laid. And the cost was very considerable. It took hundreds of millions of dollars-regarding which there has been so much criticism-money properly spent.
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Mr. Euler

to put the system into that condition in which it could compete with the Canadian Pacific Railway.
Sometimes I am almost convinced that the reason why there is so much criticism of the Canadian National Railways is that they were made capable of competing with the great Canadian Pacific Railway. Hundreds of millions of dollars were voted by this house for the purposes of the Canadian National Railways. As has been said before, our friends who are now sitting on the other side of the house and who at that time were on the opposition benches voted for these grants, and without any opposition; and I was surprised this afternoon to hear the Minister of Railways say, when he was challenged on that point, that he had never made objections to voting these large sums of money. Perhaps I am not using his exact words, but this is the sense of what he said. He said it was as much as a member's life was worth to do anything that was in opposition to the wishes of Sir Henry Thornton.


Robert James Manion: Political life, I said.


William Daum Euler: All right; does it mean my
hon. friend places political life above the interests of this country?


Robert James Manion: Apparently my hon. friend did when he was a member of the government that permitted the extravagance that went on.


William Daum Euler: I never admitted they were
extravagances. My hon. friend said they were, yet he countenanced them.


Robert James Manion: $200,000,000 worth.


William Daum Euler: I would like to ask in perfect good nature whether that is an example af the red-blooded Canadianism of which he loves to speak.


Robert James Manion: I do not need to learn
Canadianism from you.


Ira Delbert Cotnam: Millions of ties the year
before election.


William Daum Euler: I will say something about
ties in a moment. Then came the depression. Everyone in the country felt the depression, the railways as all other businesses. Industrial firms had expanded at that time beyond all reason. We all thought-I think I may say that-almost every citizen of Canada, in private life, in business life, in parliamentary life, thought that we had entered upon an era that would be prosperous forever after, and we were all going to be . rich and happy. And then we had the awakening, and the railways did not escape. Every

industry suffered heavy losses: the railways suffered heavy losses. The railways naturally felt the depression in their revenues. They were exposed to greater difficulties than the average business was, for the simple reason that just at that time there became effective the most strenuous competition by trucks and automobiles. My hon. friend said this afternoon, and perhaps quite fairly, that the government should not be blamed so particularly for the difficulties which this country had experienced, because we had been passing through a great world depression. If he claims that justice for the government why does he not do justice in the same way to the railways? The railways suffered through the depression, and it is utterly unfair to blame the railways alone for extravagance in expansion when such blame is just as applicable to every other business carried on in Canada. The great competitor of the Canadian National felt the depression almost as much as the Canadian National itself. That of course was very largely the result of competition. I am not going to weary the house again with my opinions regarding railway competition. As I have said before, competition between the two railways of Canada is not the life of the railways but rather their death.
I want to make just one more reference to the address of the Minister of Railways this afternoon. He referred to political interference with the road while the King government was in power. He made the statement, I think, that the Liberals rolled the pork barrel from one ocean to the other and back again, and that the Canadian National had become a political club. I resent that statement. I happened to be a member of the King government in the last four years of its existence. I cannot recall a single instance while I was a member of that government when any political pressure was suggested in any respect whatsoever with regard to the running of the Canadian National Railways. I knew the late Sir Henry Thornton pretty well. On more than one occasion I asked him whether there was any political pressure brought to bear upon him, and he told me that from the then Prime Minister down he never was subjected to any political pressure by anyone in regard to the running of the Canadian National Railways. I said a moment ago I was not going to indulge in recrimination, and I do not desire to do so, but when the Minister of Railways makes the statement that the late government was exercising political pressure, patronage if you like to use the expression;

The Budget-Speaker's Ruling
that a political club was made of the Canadian National, and that the pork barrel principle was being applied, I should like to say to him and to the house that these words come ill from the mouth of the man who said in the committee two years ago that out of twenty-eight tie contracts, twenty-seven were switched by him to Conservatives.


Robert James Manion: I did not say any such thing.


William Daum Euler: It is on the record. Now I have nothing more to say. I have tried in my feeble way to defend the memory of a man who is gone, a man who, I believe, did a great service for this country. He had the defects that great men often have. But I should like to close by suggesting that if we must fight partisan battles with regard to the condition of the Canadian National, let us at least allow to rest in peace a man who while here never was properly able to defend himself, and now is not able to defend himself at all.


Robert James Manion: Mr. Speaker-


Some hon. MEMBERS:: Order.


Mr. BENNETT:: He has a right to speak.


Robert James Manion: Yes, an amendment was moved after I spoke this afternoon, so I have a right to say a few words. I am going to say only a few words.


Ian Alistair Mackenzie: Mr. Speaker, I rise to a point of order.


Leslie Gordon Bell: Don't you know about the amendment?


Ian Alistair Mackenzie: My point of order is that the amendment moved this afternoon by the hon. member for Wetaski-win (Mr. Irvine) is not in order.


Leslie Gordon Bell: Why didn't you raise that point earlier?


Ian Alistair Mackenzie: A resolution was moved on the 5th of February, 1934, and adopted by the present government, the last words of which are as follows:
-in order that they may absorb the goods produced, thereby creating a more equitable distribution of our wealth production.
The government officially accepted the details of that resolution, and it was unanimously adopted by this house. I submit with great respect that the words in the amendment now moved referring to the distribution of our present abundance are merely a repetition of the resolution adopted by the house on February 5, 1934.


Pierre Édouard Blondin: The amendment moved by the hon. member for Wetaskiwin (Mr. Irvine), seconded by the hon. member for Red Deer (Mr. Speakman), reads as follows:
This house, while appreciating the unusually difficult task of the government in attempting to administer the present system, regrets the undue delay in taking necessary steps leading to the distribution of our present abundance amongst the Canadian people.
It is now alleged by the hon. member for Vancouver Centre (Mr. Mackenzie) that the amendment is out of order on the ground that the matter therein dealt with was disposed of by a motion made by the hon. member for North Winnipeg (Mr. Heaps) on February 5, which motion reads as follows:
Whereas there still exists in Canada an acute unemployment problem, and
Whereas it is desirable that as many as possible of these unemployed should be absorbed into the industrial life of the nation;
Therefore be it resolved, that, in the opinion of this house, the government should take into immediate consideration the necessity of reducing the hours of labour of those engaged in industry, and also increase the purchasing power of the masses of our people in order that they may absorb the goods produced, thereby creating a more equitable distribution of our wealth production.
That motion was agreed to. The principle thereby enunciated was adopted by the house. The amendment now before the house does not propose a policy or advocate the adoption of a principle; it merely regrets the undue delay in taking necessary steps leading to the distribution of our present abundance amongst the Canadian people. It is merely a statement of regret that the principle adopted in the resolution of Mr. Heaps of February 5 is delayed in its execution. I therefore hold that this amendment is in order.


Robert James Manion: Mr. Speaker, I do not intend to delay the vote in the house, and I should not have risen except for the language of my hon. friend (Mr. Euler) in accusing me of attacking the memory of a man who is dead.


William Daum Euler: So you did.


Robert James Manion: I deny that I attacked the memory of any man who is dead; I did not mention Sir Henry Thornton's name this afternoon in any shape or form. I criticized the late government and I criticize them now for their absolute neglect of public duty in permitting the management of the Canadian National Railways to spend the huge sums that they spent on useless appurtenances to that railway, such as hotels, scattered from the Atlantic to the Pacific-


William Daum Euler: Did you ever make a
protest?

The Budget-Mr. Manion


Robert James Manion: I do not know that I did;
I probably was not well enough posted. I was not a minister as my hon. friend was, and was not familiar with the amounts. My hon. friend who in this house and throughout the country boasts that he is such a great supporter of public ownership has been one of the deadliest enemies of public ownership in this country. He sat in a government that not only permitted but, I repeat, encouraged the expenditure of hundreds of millions of dollars by the Canadian National Railways that never should have been expended. He sat as member of a government which permitted hotels to be built at Halifax, at Saskatoon and at Vancouver; that permitted railway lines to be purchased! all over the east and to some extent in the we6t; that authorized the expenditure of $50,000,000 for the Montreal terminals and of $40,000,000 to $50,000,000 for the construction of branch lines, perhaps half of which were needed, in the west. He was a member of the government which permitted ships costing $8,000,000 to be built on the Pacific coast which were never used and which are rotting at the docks to-day.
I had a right to say that the pork barrel was rolled from the Atlantic to the Pacific, I have no doubt under the direction of the government of which my hon. friend was a member. So we had the Canadian National spending these huge sums of money. There was the hotel at Halifax, which was not required at all since the Canadian National had agreed to go in with the Canadian Pacific for the construction of a hotel. That hotel was built, but a second hotel was built also, costing $2,500,000. There was a hotel built in Saskatoon costing $4,000,000, when the best that could have been expected was a million dollar hotel; that was the largest hotel that possibly could have been expected to pay its way. Then they spent $11,000,000 on the hotel in Vancouver, where no hotel was needed at all. That city is over-hoteled to-day, without that Canadian National hotel ever being opened.


William Daum Euler: My hon. friend knows that hotel was the result of an agreement which was made before Sir Henry Thornton came in.


Robert James Manion: Not that hotel.


William Daum Euler: Not for a hotel, but for something else.


Robert James Manion: The so-called shadow government concluded that agreement with the city of Vancouver and agreed to build a hotel costing $3,500,000. My hon. friend and his government increased that sum until it

reached $11,000,000, and the contracts were let before we came into power. They purchased railway lines all over the east, not one of which ever paid operating expenses. They built ships costing over $8,000,000 to compete with the Canadian Pacific ships, when the Canadian Pacific were not making any money. These ships which cost $8,000,000 now are rotting away because there is no work for them. In all, in these items I have mentioned, they spent at least $150,000,000 that was absolutely wasted, not one cent of which was justified, but which was merely added to the capital expenditures of the Canadian National Railways. They added probably something like $8,000,000 or $9,000,000 a year to the bonded indebtedness of that railway.
But that was not all, Mr. Speaker. That was in a preelection year. My hon. friend suggests, in that high minded manner which he adopts here and in other parts of this country, that he was too honourable to permit any money to be spent on politics by the Canadian National. I say that entire amount of $150,000,000 was spent on politics. I believe I am justified in saying that the Liberal party permitted the pork 'barrel to roll from the Atlantic to the Pacific and back again for that purpose. Incidentally, Mr. Speaker, there was an amount of $600,000 placed in the estimates of 1929 for a hotel in Prince Rupert, a little place of fifty-five hundred people, where you could not build a $25,000 hotel and make it pay. That $600,000 hotel was provided for in the estimates of 1929, and we had to stop it.
That is only part of it; all through the Canadian National Railways, when we came into power, there were ridiculously high salaries. Just let me quote some of the salaries that were being paid. Mr. Gaston was receiving $62,000 a year, and my hon. friend was a minister in the government that paid that amount out of the taxes of the people of this country. That man was receiving $62,000 a year for doing nothing that was useful to the country or to the people. Those who came to me asking that we should get rid of Mr. Gaston were the officers of the railways themselves, not Sir Henry Thornton. The officers of the railways pointed out to me that Mr. Gaston was lording it over the rest of the men, without doing a cent's worth of work for his $62,000 a year. There were other men getting from $45,000 a year down; ninety-six of them were paid over $10,000 a year. Imagine that, Mr. Speaker; there were ninety-six employees of the Canadian National 'Railways receiving

The Budget-Mr. Manion
over $10,000 annually when the Canadian Pacific had only fifty-three employees receiving more than that amount.
Then let me say a word with regard to specifications. My hon. friend put himself out to taunt me because at one time I spoke of red-blooded Canadianism. Well, Mr. Speaker, I do not think I need learn anything about Canadianism from the hon. gentleman, at any rate. Laying that aside for the moment, however, the hon. gentleman was a member of the government which permitted the late management of the Canadian National Railways to specify that forty per cent of all the material supplied for the Saskatoon hotel, the Halifax hotel, the Montreal terminals-that $50,000,000 extravagance which was absolutely unnecessary-should come from the United States. He was a member of the government which permitted the Canadian National Railways to spend $100,000 a year on club dues, which now have been cut to something between $5,000 and $10,000 a year. He was a member of the government which permitted the Canadian National Railways to spend $2,000,000 a year on entertainment account, which now has been cut to something like $400,000 a year or less. He was a member of the government which permitted the Canadian National Railways to switch accounts. They would pass millions of dollars for the construction of such useless appurtenances as the Saskatoon hotel, for example, or the Vancouver hotel; then, at the whim of some individual in the Canadian National, they would switch those amounts. They did that in 1930 to the extent of $8,000,000. He was a member of the government which permitted the Canadian National Railways not only to spend money in this country but to go down to Jamaica and start to build a hotel there, which was estimated to cost half a million dollars but which actually cost a million dollars. This hotel cost the people of Canada $270,000, and today it is nothing but a bone of contention between the people of Jamaica and the people of this country; it has been of absolutely no use to the Canadian National or to the people of this country, yet it cost us $270,000. My hon. friend was a member of the government which hired Sir Henry Thornton at a salary of $75,000 a year and legitimate expenses, which were estimated at about $25,000 annually. Yet he was a member of the government which permitted Sir Henry Thornton to draw $150,000 year after year, and at least $50,000 or $60,000 of that amount had no real basis. My hon. friend was a member of the government which permitted Sir Henry Thornton, in addition, to take over the house in which he was living, a house for which he paid $5,000 or $6,000 a year, but which, after it was taken over by the management of the railways, cost the Dominion of Canada $20,000 a year.
I have a whole list of items of extravagance here; I could go right on down the list. There is the radio, for example, which cost over $250,000 a year, but which was of no use to the Canadian National Railways. Yet my hon. friend says he was not acquainted with any reason why he should have interfered, or something to that effect.


William Daum Euler: I never said that.


Robert James Manion: My hon. friend says he knew of no unfair extravagance, or political interference. There should have been political interference, if there was not; there should have been some interference to get the Canadian National back to where it is now, under economical management, which is fair to the country and to the railway itself.


William Daum Euler: Is there any political interference now?


Robert James Manion: To the extent of keeping them on an economic and decent basis, yes; there is political interference to that extent, and God knows it was needed, when we came into power. All one has to do is look at the Duff report, extracts from which I have before me. Speaking of the Canadian National under the regime of my hon. friends the Duff report says:
Running through its administrative practices, however, has been the red thread of extravagance.
I could go on and quote statement after statement of that kind from the Duff report, which was brought in by men who were fair judges, business men who had no axes to grind and no political favours to give, men who looked over the whole Canadian National system and gave a fair-minded report. They condemn most severely the attitude of the Canadian National, and without putting it into so many words, though in some places they get very close to it, they condemn my hon. friend and his government for permitting the Canadian National to carry on these wild extravagances to the extent I have indicated.
So far as Sir Henry Thornton is concerned, I merely wish to close1 on this note: I have never attacked Sir Henry Thornton personally; I have attacked the extravagances of the Canadian National Railways and I think rightly so, as any man in this house has a per-

The Budget-Mr. McGibbon
feet right to attack such extravagances, feeling that 'he has a duty to perform towards this country. If I never perform another duty for Canada I think I have performed a good one in cleaning up the mess that my hon. friend and the government of which he was a member left so far as the Canadian National Railways were concerned, and with which I had to deal after they went out of power.


Some hon. MEMBERS:: Question.


Mr. PETER McGIBBON (Muskoka-Om-tario):: Mr. Speaker, after serving seventeen years in this House of Commons I am not to be silenced by a demonstration of this kind.
I think I may leave it to the judgment of the house whether I have spoken very often during this or any other session. I rise now not because the Minister of Railways (Mr. Manion) needs any defence, but to protest against the speech of the hon. member for North Waterloo (Mr. Euler).
As most hon. members know, a few years ago I had something to do with exposing the extravagances, and I believe I am discreet in my language when I say that I helped to expose the graft, which were found at that time in the Canadian National Railways. Ever since, in this house and on the public platforms, I have refrained from exposing the knowledge which came to me from investigations I was called upon to make during that time. I have been content-yes, I have been willing in the interests of this great nationally owned enterprise, to let bygones be bygones, and to devote all the talents and the ability I possess to the building up of the fortifications of public ownership behind this great enterprise. But when year after year I hear charges made that we are out to destroy the national railways, and when I heard the hon. member for North Waterloo speak to-night, as he has spoken in the country in weeks gone by, and when I noted the tone in which he spoke, I believed it my duty to rise and to protest. I want to tell him and to tell this House of Commons that if hon. members want me to expose what I know and that which up to the present I have not exposed, namely the graft that was carried on in the national railways, I am willing to take the people of this country into my confidence, and to tell them what I found out.
The hon. member who has just spoken was appointed, with myself, to go to Montreal and to investigate the railway accounts. Did he go? No, he refused to go. Every member on the Liberal side of the house refused to go. In fact, only one hon. member, namely the hon. member for Saskatoon (Mr. MacMillan),

had the courage to go down there and to investigate the accounts of the national railways. I want to say here and now without fear of successful contradiction that what we found there was a disgrace to the executive of any great corporation. I have not said so before, but I am prepared to say so now either in this house or in the country.


Mr. JACOBS:: Would the hon. member permit a question?


Peter McGibbon: Yes.


Samuel William Jacobs: Does not the hon. member think that as a member of parliament it was his duty to expose graft, no matter where he saw it?


Peter McGibbon: If it is my duty it is equally the duty of hon. members sitting opposite, but they failed to do it. You would not do it, not one of you.


Samuel William Jacobs: They are not detectives.


Peter McGibbon: You might, then have given some assistance to those who were willing in the interests of the people of Canada to play the part of detectives.
I want to go back to the beginning of the national railways question. Where did it begin? I repudiate the suggestion that it was begun by the Conservative party. I say it began first when the bonds of the Canadian National Railways from Fort William to the east were guaranteed, and again at the beginning of the building of the Transcontinental railway from Winnipeg to Moncton. After those two things had been done by a Liberal government, the national railways became a question for the parliament of Canada, and for no other body. You cannot get away from it. I was a member of the house when, in 1919, the railways were taken over. What did we find? It is quite true that some of the railways threw up their hands and said, "We are through." But that did not relieve the parliament of Canada from its obligations. Read the railway history of that time and see what you find. The parliament of Canada at that time had obligations amounting to $331,000,000 to which they had put their name and which they would have to pay. In addition to that the provinces had guaranteed $96,000,000 worth of bonds. 'In addition to that we had another $400,000,000 invested in railways like the Intercolonial. In other words, something over $800,000,000 which Canada then had at stake 'would have been lost if we had let the railways go into bankruptcy. It is all very

The Budget-Mr. McGibbon
well after the fact to say, "You should have done so and so," but at that time the Dominion of Canada and the provinces would have lost practically $800,000,000, had we done so.
What happened? We took over the railways. What did they cost the people of Canada? They cost about another $800,000,000, and in that we had the whole Transcontinental system, we had the terminals, we had the gathering lines and everything that is essential to a railway system. When we went out of power what happened? What happened between the day we went out of power in 1921 and when we came back in 1930? Read the Duff report, and you will find that during that period $922,000,000 of debt was placed upon the railways, through the instrumentality of the King government; $922,000,000 more was added to the debt. That is the condition with which this government was faced when it came into office. You want to know why? Well, just look at some of the railways which were taken over. Take, for example, the Gaspe railway. I am told that the year before last it cost a million dollars to take the snow off that line. What about the Quebec, Montreal and Southern railway? Read the reports prevalent about that deal, where the vendors sold for $6,000,000, and only $5,000,000 reached the owners. Read those reports. Then, read the reports of the extravagances exposed in the committee which sat in this building; read about the deals in New York, the offices in that city and, as the minister suggested, the extravagant salaries. Consider the commissions on everything bought for the national railways, and the extravagance in connection with the building of branch lines. Compare the expenditures on the Canadian National Railways with those of the Canadian Pacific Railway, and you will understand how through extravagance the cost mounted up year by year. Consider the hotel competition, and the fact that the hotel in Saskatoon cost $16,000 per room. Is it any wonder it has never been opened? I placed on the committee records an agreement drawn by the late Doctor Reid, then Minister of Railways, indicating that the government of the day was exempt from all obligations in connection with the building of a hotel at Vancouver. At one time there were obligations, but through negotiations he exempted the government of the day from those obligations. Yet the building of the hotel was proceeded with, and the railways, through the government of the day, authorized a building
costing $11,000,000. Is it any wonder that the national railways got into the mess in which we found them when we took office?
I want to tell the hon. member for North Waterloo that the government of which he was a member has damned public ownership through the instrumentality of the national railways for all time to come in the Dominion of Canada. I say without fear of successful contradiction that the national railways cannot be made to pay, and when I say that I am wiping off the $1,300,000,000 of Canadian government obligations. I take into consideration only the $1,253,000,000 of bonds that were put out to the public and on which we have to pay something like $58,000,000 of interest a year. In my opinion the day will never come when the national railways can break even and pay their debt to the public. It cannot be done, and I would ask the Prime Minister (Mr. Bennett), I would ask parliament and the people of Canada this question: Is it not time that we faced this situation as we ought to face it, as a business proposition? If we cannot do anything better let us say to the people of Canada that in our judgment these two railways should be united. I said that a year ago on the floor of this house, and I was glad to read in the press only the other day that Mr. E. W. Beatty recently made practically the same speech to his directors that I made a year ago on the floor of this house. If we can save $75,000,000 a year, as the president of the Canadian Pacific Railway says we can, as the hon. member for North Waterloo says we can, and as the late president of the Canadian National Railways said we could, why not do it? Why continue to ask the people to put their hands in their pockets year after year to raise fifty or sixty or seventy million dollars, -for what purpose? To finish paying for the national railways? No. The people do not own the national railways, and it is only a fallacy to think they do.
I remember the hon. member for East Algoma (Mr. Nicholson) asking the late Sir Henry Thornton what value he would put on the national railways as a going concern, and he replied about sixty thousand dollars per mile. If you figure that out it means just the amount of money that we owe the public. That is all they are worth, and all we are doing is holding the bag. Are we going to continue to ask the people of this country to put their hands in their pockets year after year and pull out fifty or sixty million dollars? And remember, that does not take into
The Budget-Mr. McGibbon

account any depreciation; it allows nothing for improvements, extensions or betterments.
As I have said before, if we are going on with these roads as they are to-day, they will cost this country $75,000,000 a year for many years to come, and what do we get in return? Surely with the competition there is to-day from buses; with the competition which is in sight from the air, and with the control which the board of railway commissioners exercises, this country is sufficiently protected against a railway monopoly. Surely we do not have to spend sixty or seventy million dollars a year simply to protect this country against a railway monopoly. I say without fear of contradiction that taxation will have to be lifted from the back of the individual and from the back of business before this country can regain that degree of prosperity which we are all hoping for.


William Daum Euler: May I ask my hon. friend a question?


Mr. McQIBBON:: If you do not make it too hard.


William Daum Euler: My hon. friend is suggesting amalgamation, as I have done before. Would he have amalgamation under private or public, ownership?


Peter McGibbon: I am glad my hon.
friend has asked that question. I was going to say that the Prime Minister should let the people decide that question by referendum. Let them say whether they want these roads run under public or private ownership. I have no hesitation in saying that I would choose private ownership, but the people have such a huge investment in these roads that they have a right to be consulted. I would say to the Prime Minister:	Work out a scheme
of amalgamation. I mean more in the line of what I suggested a year ago, namely, that the government retain ownership of its own lines and the Canadian Pacific Railway retain ownership of its lines, but put them under joint operation and let the people decide whether they be under public ownership or private ownership. But for goodness' sake let us relieve the people of the heavy financial responsibility they are carrying to-day and which they must continue to carry unless something is done.
I was dreadfully disappointed when I read the other day Mr. Beatty's statement that only one million dollars' worth of savings had been effected through cooperation in one year, and presumably the greatest savings have already taken place. Now when we are faced with a deficit of $65,000,000 or $70,000,-

000	a year on account of the national railways
1	ask this parliament what right have we to inflict that taxation on the people when there is a remedy for the situation? I ask the Prime Minister and I ask this house to submit this question to the people of Canada in an unbiased way with the idea of consummating amalgamation of these two roads so far as operation is concerned, and let the people say whether they want it done under public ownership or private ownership.


Mr. MULLINS:: I was paired with the hon. member for St. Boniface (Mr. Howden). Had I voted, I would have voted against the amendment.


Mr. GOLDING:: I was paired with the hon. member for North Perth (Mr. Wright). Had I voted, I would have voted against the amendment.


Hon. J. C. ELLIOTT (West Middlesex):: Mr. Speaker, I should like to make a few remarks before the main motion is put, I think we have witnessed something which is typically characteristic of the previous and the present governments. I refer to the sane, logical and reasonable remarks of the hon. member for North Waterloo (Mr. Euler) as compared with the utterly partisan, bombastic and venomous remarks of the Minister of Railways and Canals (Mr. Manion). The minister referred to the extravagance of the previous government, but I do not think there was ever anything so extravagant in connection with any government in this country as the remarks he made. It is not my intention
to occupy the time of the house at any length as we are all hoping to get to a vote on the main question, but in view of the fact that the amendment moved by the hon. member for Shelburne-Yarmouth (Mr. Ralston) has been ruled out of order, I desire to move an amendment which I submit expresses in a very few words the views which have been expressed wherever an opportunity of expression has been afforded in recent months in any riding in this country. I submit that this amendment represents the general feeling of the people of Canada at the present time. I beg leave to move, seconded by the hon. member for Gloucester (Mr. Veniot):
That all the words after "that" to the end of the question be omitted and the following be added instead thereof:
In the opinion of this house the present administration no longer enjoys the confidence of the country.


Hon. HUGH GUTHRIE (Minister of Justice) :: Mr. Speaker, my understanding of the rules of this house is that only one amendment and one subamendment can be moved to the main motion that Mr. Speaker do now leave the chair. During the present debate an amendment was moved and declared out of order. Subsequently a subamendment was moved and also declared out of order. Another amendment was moved and has been voted upon but no subamendment was moved. I submit that under rule 49 no further amendment is permissible. If it were otherwise we might be met with amendment after amendment as votes are taken, and Your Honour would never be permitted to leave the chair. There are other reasons why this amendment is out of order, but at the moment this is my principal reason for objecting.


Pierre Édouard Blondin: Standing order 49 reads:
Only one amendment and one subamendment may be made to a motion for Mr. Speaker to leave the chair for the house to go into committee of supply or ways and means.
That would seem to prevent the present amendment being in order, and I rule it to be out of order.
Main motion (Mr. Rhodes) agreed to on division and the house went into committee of ways and means, Mr. Sullivan in the chair.



WAYS AND MEANS


[Stage Direction]
Resolved, that it is expedient to amend the Income War Tax Act and to provide:
1.	That income shall include rents, royalties, reservations and other like considerations which fluctuate according to the production from or the use of the property leased or sold.
[Stage Direction]
Foreign Insurance Companies
Richard Bedford Bennett: This is to provide for cases in which royalties are paid and have sometimes escaped taxation. This removes any possible doubt with respect to that and provides that royalties that may be payable to individuals under subleases of properties, oil and others, on which royalties have been paid, shall be taxable as income. This is sufficient for to-night, I will move that the committee rise and report progress, passing that one resolution.


Mr. MACKENZIE KING:: The resolution has eight parts.


Richard Bedford Bennett: That is right; this is the first clause. I move that the committee rise and report progress and ask leave to sit again.
Progress reported.


FOREIGN INSURANCE COMPANIES
Richard Bedford Bennett: If the house would give consent I would move the second reading of Bill No. 50 and Bill No. 72 in order that they might be printed and circulated for the information of the house. Bill No. 50 has been passed by the Senate. It is an act to amend the Foreign Insurance Companies Act of 1932. It is a technical statute, and any explanation I might give would be wholly ineffectual unless the bill were before hon. members. I suggest that it would serve every useful purpose if I now moved that the bill be read a second time in order that it be printed.


William Lyon Mackenzie King: Is it intended to discuss the bill in committee of the whole house?


Richard Bedford Bennett: Yes. In view of the discussion that had taken place in the Senate I thought that this house was more or less familiar with what had transpired and that it would serve the purpose if the bill were considered in committee of the whole house.


Mr. WOODSWORTH:: Are we agreeing
to the principle of the bill before we know what is involved?


Richard Bedford Bennett: We are dealing with
foreign insurance companies. The method is somewhat technical. It arises out of legislation that has been passed on previous occasions, and it is well known that great conflict of opinion has taken place as to the legislative jurisdiction of the provincial legislatures on the one hand and the parliament of Canada on the other. Certain decisions

have been arrived at in the privy council since 1916 to' date, and it is believed that this legislation will clarify to some extent the difficulties that have been experienced. I can say frankly that there is no great national principle at stake; rather is it an effort to pass legislation which beyond question will be within our legislative competence and to deal with the matters in the manner in which we believe they should be dealt with. It is complementary to a bill that follows on the order paper. There seems to be no doubt as to our right to deal with foreign companies, and the manner in which we deal with them will be prescribed in the act. Our right to deal with our own companies is conceded.


Ian Alistair Mackenzie: Does this bill refer to foreign insurance companies or to British and Canadian insurance companies?


Richard Bedford Bennett: The point as to our jurisdiction to deal with foreign companies is not seriously questioned; it is only the method by which that jurisdiction is to be asserted.


James Shaver Woodsworth: Does this refer to companies asking for special privileges?


Richard Bedford Bennett: That comes in one of the statutes, the second bill dealing with Lloyds.


William Daum Euler: That is not the one which the Prime Minister is discussing now?


Richard Bedford Bennett: No; that is Bill No. 72.


Mr. COOTE:: Is it necessary to have the second reading of the bill before it can be printed?


Richard Bedford Bennett: The bill has been printed and is ready for circulation, but it is not in the hands of hon. members until after the second reading has been given. That is why I suggest that it be given the second reading, so that members will be in a position to study the bill. It might be that after the house had considered the matter they might think it desirable that the bill should go to one of the committees of the house, but I do not think that will be necessary.


James Layton Ralston: If the house gives second reading, I am sure the Prime Minister will agree that it is on the understanding that we may discuss in committee everything which we might discuss on the second reading.


Richard Bedford Bennett: I judged that that was what the right hon. the leader of the opposition intended by his question; I construed it

Foreign Insurance Companies
as such. If the house gives the second reading,
I do not propose that it should limit its right to discuss every feature of the bill, even though that might involve some question of principle.


Pierre Édouard Blondin: Mr. Bennett, for the
Minister of Finance (Mr. Rhodes), moves that Bill No. 50, entitled an act to amend the Foreign Insurance Companies Act, 1932, be now read the second time.


Mr. LAPOINTE:: What is the advantage in that? My right hon. friend says that it is for the purpose of having the bill circulated. Surely the bill may ibe circulated before the second reading. Bills are always printed and distributed before the second reading. Why the change in this instance?


Richard Bedford Bennett: The former Minister of Justice (Mr. Lapointe) is entirely correct. The bill has to be printed in English and French before it is given the second reading. I should have said, more properly, that the official presentation of the bill for the consideration of -members arises by reason of its being given second reading, and the house is then in a position either to discuss the details of the bill in committee of the whole house or to send the bill to another committee. I intended to move the bill one step forward to-night. Perhaps the language I used with respect to the necessity of its being printed was too wide.


James Shaver Woodsworth: I fail utterly to
comprehend why this bill should be given special treatment, different from that accorded other bills. Apparently it is not because it should be printed, because there is nothing to prevent its being printed and circulated before the second reading, and we have not been given any details with regard to the principle underlying it. I do not like advancing the bill at this -time, making in this way an exception of it.


Richard Bedford Bennett: The rules of the house do provide that on the second reading of a bill it is not proper to deal with the several sections. This bill is one which amends the existing sections of a statute, and the extent of the amendments is indicated in the bill. The reason it has to be printed in English and French before it is read -the second time, as the hon-. gentleman has said, is that members may at least see it. The principle of the bill is merely to amend and make more perfect existing legislation which was passed at a previous session and with respect only-so far as this bill is concerned-to foreign insurance companies, with respect to which the
legislative jurisdiction of this parliament is unquestioned. If this were a new measure and I were asked to unfold to the chamber the principles involved in it, I would do so, but where it involves merely amendments, according to the rules it is not sound parliamentary practice to take the bill section by section and indicate at this time what is involved. If I say that the principle of the bill is to make more perfect the administration of this statute I have said all that is involved with respect to it, as any one can see by taking a casual look at it.


Mr. POULIOT:: I submit that all this discussion has been completely out of order, because, sir, you were reading the motion for the second reading of the bill, and I understand that on the second reading a member can speak only once. The Prime Minister spoke several times, and other members also. I submit, sir, that this discussion is irrelevant and out of order.
Now, speaking on the second reading I have just one word to say. Lloyds will be very much surprised when they see this legislation and learn for the first time after centuries that they are called an insurance company. For the benefit of the government may I tell them that if they will glance at the Encyclopaedia Britannica in the library they will see that Lloyds is not an insurance company; it is just a club.


Hugh Guthrie: Will the hon. member permit me? He is confounding this bill with the one which immediately follows it. This bill deals only with foreign insurance companies. The next bill deals with British and Canadian companies.


Jean-François Pouliot: I thank the minister for his explanation. I am glad to hear that this bill does not refer to Lloyds as an insurance company; and what the Minister of Justice has just said confirms what I said before.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Sullivan in the chair.
On section 1.
Richard Bedford Bennett: It will be observed that the only change is that in the original preamble the words were "soliciting and securing." It is proposed to change it to "are soliciting applications for and issuing," so as to conform to the facts, namely that they are soliciting applications for and issuing life insurance policies. That is the only change in that section.


[Stage Direction]
Section agreed to.
Questions
[Stage Direction]
On section 2.
Richard Bedford Bennett: This is changing one word only, as to the extent of the insurance at risk, it having been stated as "three and a quarter billions of dollars" when the other statute was passed, and now being "four and a quarter billions" or thereabouts.


[Stage Direction]
Section agreed to.
Progress reported.
On motion of Mr. Bennett the house adjourned at 10.50 p.m.
Wednesday, May 16, 1934