1937-03-11

[Stage Direction]
Second report of the standing committee on railways and shipping, owned, operated and controlled by the government-Sir Eugene Fiset.


[Stage Direction]
Bill No. 57, respecting Industrial Loan and Finance Corporation.-Mr. Vien.
Bill No. 58, respecting the Central Finance Corporation and to change its name to Household Finance Corporation.-Mr. Duffus.

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

Mr. ROSS (Moose Jaw):: 1.	What was the amount paid by the Canadian Wheat Board for carrying charges on wheat in country elevators for the 1935 crop?
Questions

2. What are the names of the elevator companies to whom this amount was paid and what
amount was paid to each?


Mr. ROGERS:: 1.	83,497,939.71.
2.	Amount
Alberta Pacific Grain Co	$	188,150 87Alberta Wheat Pool	
371,394	44Alliance Grain	Cjompany..	..	7,739	80Anderson Elevator Company..	2,778	69Bawlf Grain Company	
38,667	11British American Elevator Co.	70,716 98Bishop Milling	Company..	..	55	68Burns & Watson	
166	83Byers Flour Mills	
314	46Canada West Grain Company.	7,233 96Canadian Consolidated Grain Co.	56,918 01Colley, F. T	
97	47Conger Sanborn	Company..	..	2,664	68Darlingford Farmers Elevator..	142 41Ellison Milling	Company..	..	15,980	45Federal Grain	Company..	..	206,202	79Forrester, G. A	
20	59Forsythe & Company	
567	77Fraser, W. 0	
627	47Gillespie Grain Co	
39,280	77Gold Grain Company	
7,525	34Grand Prairie Grain Co..	..	2,660	38Harrison Milling & Elev. Co..	537 31Hess, M. M	
544	28Inter-Ocean Grain Company.. ..	9,894	57Independent Grain Co	
19,783	72KalmacofT & Company	
101	96Kennedy Grain	Company..	..	457	82Krause Milling Company	
878	03Lake of the Woods Milling Co.	36,567 17Little & Little	
931	16Lytle, T. H	
225	09McCabe Bros. Grain Co	
53270	31McCulloch & Company	
2,516	74MacEachern Milling Co	
492	21Manitoba Pool Elevators Ltd..	125,380 98Maple Leaf Milling Company..	639 54Midland & Pacific Grain Corp.	58,187 82Mohler, J. J	
214	10Morden Milling Company.. ..	466	23Mutual Grain Company	
5,643	99National Elevator Company..	97,133	17Nerby Grain Company	
3,808	42Noak Grain Company	
964	93Noble, C. 8	
968	20Northern Elevator Company.. ..	60,634	94Northern Grain	Company..	..	8,550	10North Star Grain Company.. ..	48,187	28Northwest Commission Company.	764 83Ogilvie Flour Mills Co. Ltd..	49,687 20Outlook Flour Mills	
25	01Parent Grain Company	
487	82Parrish & Heimbecker Ltd.. ..	41,821	97N. M. Paterson & Co	
51,770	21Peaker Gibson Grain Company.	2,400 96Pioneer Grain Company..	..	172,836	30Prince Albert Elevator	Co..	..	2,484	62Province Elevator Co	
84,291	15Quaker Oats Company	
11,153	01Red River Grain Company.. ..	1,194 05Richardson & Sons, J.	R..	..	30	27Ritz, Henry	
472	41Robin Hood Mills	
3,081	13Saskatchewan Pool Elevators Ltd.	903,263 01
Scottish Co-op. Wholesale Society
Ltd	
8282	52Searle Grain Company	
199,422	92Standard Elevator Co	
10,628	40Stettler Flour Mills	
104	41Strachan Elevator Ltd1	
295	36Strome Flour Mills	
132	17Swift Current Flour Mills..	..	639	56Thompson & Co. Clara	
212	06United Grain Growers Ltd..	..	242,861	28
Western Canada Flour Mills Co.
Ltd	
32,626	58Western Grain Co	
119,643	62Wiley Low & Co	
434	86

Less carrying charges recovered on sales contracts	 4,319	32


$3,493,620 39 NATIONAL HARBOURS BOARD-FIRE-BOAT &quot;PLUVIUS&quot;
Mr. GREEN:: 1.	Has the national harbours board ceased to operate the fire-boat "Pluvius" in Vancouver harbour?
2.	Was a committee appointed at the request of the national harbours board or otherwise to consider and report on the need for fire protection for the water-front in Vancouver?
3.	If so, when was it appointed, who were the members of the committee, and when did they report?
4.	What steps are being taken by the national harbours board to implement any report or reports of such committee?


Mr. HOWE:: 1.	Yes.
2.	No committee appointed at request of national harbours board.
3.	Answered by No. 2.
4.	Answered by No. 2.


EXPORTS TO UNITED STATES AND UNITED KINGDOM
Mr. MULLINS:: 1.	From January 1, 1935, to January 1, 1936, what was the quantity of the following commodities exported to the United States from Canada, as compared with the period from January 1, 1936, to January 1, 1937, viz: cheese, maple sugar, horses, cows, grain, beef C^ttl6 ?
2.	From January 1, 1935, to January 1, 1936, what quantity of cheese and beef cattle did we export to the United Kingdom from Canada, as compared with the period from January 1, 1936, to January 1, 1937?

The Budget-Mr. Coldwell


Mr. ROGERS:: 1. Exports from Canada to United States, Calendar Years:
1935	1936
Cheese	cwt.	4,749	114,564Maple sugar.. .. Lb.	1,710,850	8,207,523Horses	..No.	5.475	17,358Cows (dairy cattle) No. 6.266	8,194Grain	Bush.	24,952,159	39,260,635Beef cattle	No.	108,557	224,306
2. Exports from Canada to United Kingdom, Calendar Years:
1935	1936
Cheese	Cwt.	527,196	678,017Beef cattle	No.	6,704	38,473


BUSINESS PROFITS WAR TAX ACT, 1916
[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved that the house go into committee at the next sitting to consider the following proposed resolution:
That it is expedient to revive and amend the Business Profits War Tax Act, 1916, to validate any actions which may have been taken since the coming into force of the revised statutes of Canada, 1927, and to provide that the procedure for dealing with appeals from assessments under the said act shall be similar to the procedure for dealing with appeals under the Income War Tax Act.
He said: His Excellency the Governor General, having been made acquainted with the subject matter of .this resolution, recommends it to the favourable consideration of the house.
Motion agreed to.

[Stage Direction]
On the orders of the day:
Right Hon. R. B. BENNETT (Leader of the Opposition):: Mr. Speaker, before the
orders of the day are called I desire to direct attention to a matter of some importance. I regret I was called out of the chamber the other evening when the Minister of Agriculture (Mr. Gardiner) was speaking, but my absence was not a matter of intentional discourtesy to the minister. I have just received a telegram from Mr. John I. McFarland reading as follows:
Newspapers report Hon. Gardiner's statement in Commons in defence of wheat board selling policy wherein he said McFarland estimated crop four hundred millions on June 24. Please insist on my behalf that Mr. Gardiner gives direct authority for that statement. I never informed any newspaper man of my opinion of prospective crop at that or any
other time and no one had authority to make any statement for me. It was obvious before the end of June that all hope for a crop had been destroyed.


Some hon. MEMBERS:: Order.


Richard Bedford Bennett: This is in order; pardon me.


Mr. McLEAN (Melfort):: Reading a telegram from the outside?


Richard Bedford Bennett: Very much so. The Minister of Agriculture made a statement with respect to a citizen of this country and it is in order for me to direct attention to the fact that there must be some mistake with respect to it. I am quite sure the Minister of Agriculture would desire to remedy any mistake in a statement which might have been based upon erroneous information. I am placing this information upon Hansard in order that he may do so at the appropriate time.


Mr. POULIOT:: Was the telegram sent
collect?


Hon. ERNEST LAPOINTE (Minister of Justice):: I am sorry that my colleague, the Minister of Agriculture (Mr. Gardiner), is not in the house at this time. I shall call his attention to the remarks of my right hon. friend.


SOCIvEYE SALMON FISHERIES
[Stage Direction]
On the orders of the day:
Mr. A. W. NEILL (Comox-Albemi):: Might I inquire if the Minister of Justice (Mr. Lapointe) is now in a position to give us some information with respect to the salmon treaty, concerning which the leader of the opposition (Mr. Bennett) and myself spoke a few days ago?


Ernest Lapointe: If my hon. friend will wait I shall be able to give him an answer to-morrow.



THE BUDGET


[Stage Direction]
The house resumed from Wednesday, March 10, consideration of the motion of Hon. Charles A. Dunning (Minister of Finance) that Mr. Speaker do now leave the Chair for the house to go into committee of ways and means.
Mr. M. J. COLDWELL (Rosetown-Biggar):: Mr. Speaker, in the fifteen minutes or so which remain to me, I desire to add to my remarks of yesterday and correct an im-
The Budget-Mr. Coldwell

pression which has grown up in this house that the agitation last fall in western Canada against the action of the government in regard to the wheat board was not a natural result of the situation thus created, but was something fostered by certain individuals or organizations. The wheat board announcement regarding price and operations was made on August 28, and on August 29 the Leader Post contained the following report:
Farmers up in arms over the low minimum price. Those in southwest area called a protest meeting at Mossbank for August 31. J. Gordon Ross, M.P., and Thos. Waddell, M.L.A., are being invited to attend.
The same day the United Farmers of Canada at Saskatoon issued the following statement:
Greatest sell-out in the history of the west.
As I said yesterday, I had left that day for Ottawa by car and so was out of touch with everyone for the next ten days. But I issued the following statement:
As I understand the announcement, it means, in effect, that the wheat board will not function in relation to this year's crop unless the price falls to nearly the minimum announced. Western members of parliament, regardless of party affiliations, will, I believe, resent the government's disregard of western Canada's interests. It is time that we forgot largely meaningless party divisions, quit chasing rainbows and theorizing and tried to act together on behalf of the great agricultural industry upon which the west depends. Meantime, the grain exchange and food speculators have won. Virtually, the wheat board has gone. At least, its going is plainly foreshadowed.
I think the speech of the Minister of Agriculture (Mr. Gardiner) the other evening was somewhat in the nature of an obituary for that particular board. The Minister of Finance referred to something else that I had said. A few days earlier I had been asked what my opinion was regarding a proper minimum price. Based upon what I had seen in three trips through the United States and southern Saskatchewan, I stated that I thought a minimum price of $155 might be justified.
The farmers soon began to show their bitter resentment of the action of the board and the government as was evidenced by numerous newspaper reports. On Aust 31, Mayor W. D. MacKay of Strasbourg, expressed the opinion that a protest meeting should be held in that town against the government's action. At Milestone, J. E. Willoughby complained that the price was far too low. At Weyburn, Doctor J. K. Brimacombe, president of the board of trade, a former mayor and a prominent Liberal, stated that undoubtedly a strongly worded protest would be sent to the government. At Assiniboia, J. E. Johnstone, presi-
[Mr. Coldwell.1
dent of the board of trade, said that there would be a protest meeting. On September 1, the Crane Valley Liberal Association wired protesting vigorously against the setting of a minimum price at 87| cents. Mr. J. B. Smith, the Liberal M.L.A. for Bengough, expressed his dissatisfaction, both wilh the initial payment and with the suspension of the board's action with regard to participation certificates. The same paper reported a protest meeting at Mossbank, at which the Liberal M.L.A. for Gravelbourg, Mr. E. M. Culliton, indulged in strong criticism of the government's action. Milestone's rural municipal council of Caledonia passed a resolution asking for a minimum price of $1.15 and board action. The Leader Post of September 3 reported a strongly worded protest from the United Farmers of Alberta. On September 5 the Saskatoon Young Liberal Association decided to ask for a reconsideration of the government's decision regarding the marketing of wheat. Copies of this letter were sent to the Minister of Agriculture and the hon. member for Saskatoon (Mr. Young). On September 8, Prince Albert district farmers passed a resolution deploring the influence of the private grain trade upon the government and charging the government with violating the laws of democracy by refusing demands for a fair price. The September 10 issue of the Leader Post reported an interview with the government by Mr. L. C. Broullette, president, Saskatchewan pool; Paul F. Bredt, president, Manitoba pool; George Bennett, president. Alberta pool, at which interview the delegation protested the pegged price of wheat. On September 5 the Prairie Messenger of Muenster, Saskatchewan, reported the hon. member for Humboldt (Mr. Fleming), as having wired the wheat pool on August 21 as follows:
I, as one of the western Liberal members, am absolutely opposed to the government setting the price of wheat at 87J cents. I believe the price should be set at $1 owing to the increased cost of production. I also believe that the government should set a minimum price for coarse grains as well.
Mr. W. A. Tucker, M.P., for Rosthern, was present at a farmers' meeting at Saskatoon and he pointed out that, in common with the farmers, he was disappointed that the price had not been left at $1 a bushel. Mr. Charles Agar, M.L.A. for Hanley, read a telegram which he had sent to the hon. member for Saskatoon urging him to continue the fight to get the minimum price raised to $1. At Bethune, Mr. J. Gordon Ross and Mr. J. F. Johnstone defended the government's action, but the farmers passed a resolution expressing dissatisfaction and asking for the immediate establishment of a minimum price of $1.15. The

The Budget-Mr. Coldwell
hon. member for Mackenzie (Mr. MacMillan) addressed a large gathering of farmers, business men and professional men at Elfros on September 5 when he said:
I left Ottawa with the impression that the wheat board's initial payment for this year's crop would not be less than $1 and I am extremely disappointed at the action of the government in establishing this at 874 cents.
Mr. MacMillan added that he was unable to understand the attitude of the government and that he had written to the Prime Minister and the Hon. J. G. Gardiner, registering a strong protest. The meeting went on record unanimously against the government's action.
At North Battleford four hundred farmers, by a standing vote, demanded reinstatement of wheat board operations and a fixed minimum price of $1.15 per bushel, basis No. 1 Northern, Fort William. The meeting was presided over by Mr. W. A. Campbell, a local business man, and among those present were Mr. C. R. McIntosh, M.P., and Mr. J. A. McGregor, Liberal M.L.A. Mr. McIntosh is reported to have stated that he regarded the government's action as a complete reversal of policies for which western agriculture stood. He thought it was the duty of all western members of parliament to take a strong stand in support of the farmers' rights. He read a wire he had sent to the Saskatchewan wheat pool on August 20, expressing dissatisfaction with the suggestion of continuing the 87i cent minimum price and favouring a fixed minimum of $1.10 to $1.15 a bushel. Mr. Gregory, Liberal M.L.A., said the government's wheat marketing policy was reactionary in view of the present tendencies for the control of all industries. At Rosthern, Mr. Tucker again witnessed the criticism of the government's action. At Lang, Saskatchewan, William Peterson, Liberal M.L.A., took part in criticizing the government's action. At Golden Prairie, two hundred persons attended an indignation meeting which was addressed by J. J. Mildenberger, Liberal M.L.A., and C. R. Evans, M.P. The meeting resolved-
That the time is opportune for the Liberal party to implement the dollar wheat as promised by them in the provincial election, and sanctioned by the Hon. J. G. Gardiner, Minister of Agriculture, then a candidate for election and tlie office of provincial premier.
At Birch Hills, at a meeting attended by Malcolm McLean, M.P., and John R. Taylor, Liberal M.L.A., a resolution calling for the immediate operation of the wheat board was passed with only one dissenting vote according to the newspaper. I presume that that was the vote of the hon. member for Melfort (Mr. McLean).


Malcolm McLean: Mr. Speaker, on a question of privilege, I want to say that the hon. member for Rosetown-Biggar (Mr. Cold-well) has no foundation on which to make that remark. There is not the slightest particle of truth in it, and there is no evidence in the report of any truth in it. The resolution was voted on and carried by a very small percentage of the people who were present in that hall, in spite of the fact that a director of a certain organization who was not invited to be present came in and made a speech.


Some hon. MEMBERS:: Order.


Major James William Coldwell: Mr. Speaker, usually I am very courteous to hon. members opposite who rise for the purpose of making a correction. But if the hon. member wants to make a speech I think he should take time to do so after I get through. Yesterday I had fourteen interruptions.


Malcolm McLean: Mr. Speaker, on a question of privilege-


An hon. MEMBER:: Order.


Mr. SPEAKER:: The hon. member has risen to a question of privilege.


Malcolm McLean: Mr. Speaker, on a question of privilege, I have said that there is not the slightest truth in the assertion. The hon. member has referred to his courtesy. On this matter no hon. member of the house needs the courtesy of the hon. gentleman, because it is a matter of right. Withdraw.


Some hon. MEMBERS:: Withdraw.


Major James William Coldwell: Mr. Speaker, I am not withdrawing the statement which I read-


Malcolm McLean: The hon. member must accept my statement.


Major James William Coldwell: -which I read in the public press. My authority was The Western Producer, published at Saskatoon, Saskatchewan. If the hon. member says that that is not correct, let him correct it through the newspaper.


Malcolm McLean: Surely the hon. member knows better-that on a question of privilege, on a matter within my knowledge, he must withdraw his published presumption. I was one who talked on that occasion. I did not vote; I addressed the meeting by invitation.


Walter Edward Foster: If the hon. member says he did not attend the meeting or that he did not vote, his statement must be accepted and the suggestion withdrawn.


Major James William Coldwell: I made the statement on the authority of the newspaper.
The Budget-Mr. Coldwell


Malcolm McLean: The "statement'!


Mr. DUNNING:: The hon. member for Rosetown-Biggar must take the responsibility for it.


Major James William Coldwell: I was quoting from a newspaper. However, I accept the statement of the hon. member.


Malcolm McLean: On a question of privilege, the hon. member for Rosetown-Biggar read a statement which was in the paper and which was absolutely correct, and then he added of his own volition these words, " I presume that was the vote of the member for Melfort "-who did not vote on that occasion. What I am asking him to do is to withdraw his presumption; that is all.


Major James William Coldwell: That is different. The statement I read from the paper, then, is correct. I assume therefore that the gentleman remained silent, and silence gives consent. Therefore in effect he voted for the resolution.


Malcolm McLean: Entirely presumption. That is all.


Major James William Coldwell: On September 31 a meeting was held at Saskatoon to which the Hon. J. G. Gardiner and other western members were invited. This was the only meeting which I attended. I arrived in Saskatoon from the east on September 21, and I went to the meeting at the invitation of the citizens' committee which organized it. I might say that I went because the Minister of Agriculture was to be there. He had other engagements and was not able to attend.


Mr. GARDINER:: Mr. Speaker, as a matter of privilege may I call the attention of the hon. member to something that he must have known if he was at that meeting-that I sent a wire to the organizers of that meeting before it was actually called-


Mr. HEAPS:: That is not a matter of privilege.


James Garfield Gardiner: indicating to them that I could not be there.


Major James William Coldwell: I was not aware of that.


James Garfield Gardiner: The message was read to the meeting.


Major James William Coldwell: I had to address a meeting 100 miles away the same evening, and I attended for a short time only. May I ask, what of the statement of the hon. member for Melville (Mr. Motherwell)? The hon. member for Lake Centre (Mr. Johnston) may remember the statements made at the meeting at Semans. Also the hon. member for Swift Current (Mr. Bothwell) was at the Cabri

meeting, which was attended by a large number of persons and the town band. He agreed that the board should be continued and heard the resolution condemnatory of the government. At this point may I say that the resolutions, as my files testify, were quite evidently drawn by a very large number of different people. There are differences in the phraseology and in the terms; sometimes even slightly different things are asked for; but they all criticize the government on two grounds, first, the discontinuance of the wheat board method of marketing grain, and second, the setting of a minimum price which they regarded as being too low.


Walter Edward Foster: Order.


An hon. MEMBER:: Sit down.


Major James William Coldwell: May I be permitted to conclude?


Walter Edward Foster: With the unanimous consent of the house.


An hon. MEMBER:: Go ahead.


Charles Avery Dunning: Give the hon. member five minutes.


Major James William Coldwell: I thank the house for that courtesy. What I want to ask is this: where now are all these protesters? If these protests are to be made effective, this is the place to do it.


Mr. MacNICOL:: They are all under the woodpile now.


Major James William Coldwell: The accuracy of no single newspaper report which I have quoted has been denied. Last August and September hon. members sitting on the opposite side were loud in their condemnation of the government's action. Where are they now? The hon. member for Kootenay East (Mr. Stevens) stated yesterday that he was astonished that members had not risen in their places to offer some criticism of the government's policies; and he proceeded to give reasons, which he thought were the true reasons, for that silence. I hope that the reasons which he gave are not correct. I should like to hear western members, particularly those on the Liberal side of the house, discuss this problem from the point of view from which they discussed it in the fall of last year. Are they going to allow what the people of western Canada believe to be a great betrayal of their interests to pass unchallenged by themselves in this parliament?
One last thing. It has been said on occasion that I am acting for some one else. Last year the chairman of the wheat board re-

The Budget*-Mr. Gladstone
ferred to me at least once as "Mr. McFarland's friend." I have never met Mr. McFarland, have never seen him, have never communicated with him by letter, telegram, or by proxy, and I would not know him if I met him on the street. Further, it has been said that I am acting on behalf of the wheat pools. May I say that I have had no communication with the wheat pools except when I have met officials casually, and the only letter I have had in months from them was the letter which probably other hon. members also received, giving information of a public nature. I am merely endeavouring to express on behalf of the people who sent me here the deep resentment they feel at the discontinuance of the wheat board method of marketing.


Mr. ROSS (Moose Jaw):: The hon. gentleman read a list of different members from western Canada and said that they had protested against the action of the government. In the list there was more than one member whose name I heard read and who did not protest, although they went to these meetings. Surely the hon. member should be fair enough to point that out.


Mr. COLD WELL:: That is perfectly correct, and if a member did not protest I did not say so. I read the protests of those who did protest.


Mr. R. W. GLADSTONE (Wellington South):: It will be my purpose, Mr. Speaker, to deal in a constructive way with the broader aspects of Canadian economy. To do so I have decided to direct my remarks along two lines-first, the budget from the point of view of an Ontario city; and second, the consideration of constructive efforts to create and stabilize prosperity in Canada.
The latter I propose to divide under three headings: (a) elimination of over-government;
(b)	economy and efficiency in administration;
(c)	the creation of new wealth. Expressed otherwise my two main headings might be: (1) What we are doing, being the story of the budget and its interpretation; (2) What we might do, being the suggestions of a member who has been a rather silent observer in parliament.
The Minister of Finance (Mr. Dunning) delivered the budget two weeks ago to-day. The ground has been well covered in the debates during the intervening period. Newspaper comments express the opinion that many industries were not affected by the budget changes, but in my opinion it is doubtful whether there are many industries that have not been or will not be affected, and affected favourably, by the Canada-United States agreement of 1936 and the Canada-United 31111-106
Kingdom agreement of 1937. The point is that these agreements have been designed to give enlarged markets, three-way markets, local. British and United States, for our natural resources.
Prosperity on the farm is the best assurance of prosperity in industry. Increased purchasing power with the farmers in Wellington county will be reflected in a demand for the goods produced in the factories in the city of Guelph and in other towns and cities. It is the expectation, then, that more people will be employed both on the farms and in the factories as a result of these two agreements.
I do not propose to take time to discuss my next heading, namely, elimination as far as possible of over-government, since the Prime Minister (Mr. Mackenzie King) has announced recently that a royal commission will be named to study taxation and the division of financial powers and responsibilities. The scope of this commission, federally and provincially, was suggested recently quite comprehensively by the Canadian Chamber of Commerce to include the following purposes:	(1) to clarify the interrelation of financing and taxing powers; (2) to survey duplication of public services; (3) to redefine legislative policies; (4) to establish administrative responsibilities. We can only await the recommendations of the royal commission and thereafter hope that the counsels of wise statesmanship, rising above petty politics, will prevail to establish relationships whereby duplication of services will be eliminated.
Economy and efficiency in administration: I realize I may here be treading on dangerous ground. This is a topic that will not be popular in a narrow political sense; I mean it will be unpopular in the sense of the remarks of the leader of the opposition (Mr. Bennett) on February 8. at page 683 of Hansard. The right hon. gentleman said:
There is not a general disposition on the part of all of us to see our friends, as distinct from somebody else's friends, deprived of the employment by which they earn their livelihood. We are all perfectly willing that somebody else's friend should leave his position, but none of us is prepared to think our own friend should.
It all depends upon whose ox is being gored.
The very nature of a consideration of the subject of economy in government carries with it definite personal risks and makes it necessary that I say at the outset that I am dealing with a system and not with individual cases. Should it be found that departments are overstaffed such circumstances can be corrected. I have reason to believe they

COMMON?
The Budget-Mr. Gladstone
are being corrected, through the effluxion of time, by transference and1 by marriage and death. I say, therefore, there is no need for anxiety on the part of faithful civil servants because of anything I may say. Rather, I suggest that the prospect for the promotion of capable people will be enhanced through improved efficiency of administration, And further, I am not critical of any cabinet minister, past or present, except in his capacity as a member of parliament. Responsibility in general must come home to private members who frequently, on the urging of electors, exert pressure for the expenditure of 850,000 when the purpose would be served adequately by the expenditure of 825,000.
I wish here to express the highest confidence in and admiration of our cabinet ministers of to-day, and likewise former cabinet ministers in this house, except, of course, as regards our differences in policies.
The object of my treatment of the subject is to bring about a better form of presentation to parliament of the estimates of money required for the ensuing year and to discover means of saving public money. I have been giving this matter consideration for many weeks and at one time thought of placing on the order paper for discussion a resolution in the following form:
Whereas, accumulated debt in Canada now constitutes a crushing burden upon the people and there is widespread criticism of the cost of government: and.
Whereas the estimates of proposed expenditures are submitted to parliament without adequate details; and,
Whereas the burdens of their respective departments and responsibilities of government in general impose a full time load upon the minister of each department; and,
Whereas there is very little opportunity between sessions of parliament whereby private members may in any organized way seek to discover wastages of money;
Therefore be it resolved that in the opinion of this house the government should establish a ministry of economy, with the object of saving money, of promoting efficiency, and, between sessions especially, of consulting with the ejected representatives of the people to further these objects.
It is suggested that this department should be organized on an economy basis, without ieputy minister or private secretary and looking to its discontinuance when it has served its purpose. It seemed best, however, that I should continue my study of the subject for a time in order to feel assurance of a more convincing, or perhaps invincible, argument, carrying with it some hope for definite action this session. I have discussed this subject with the Minister of Finance who will welcome any effort, soundly based, towards the discovery of means of promoting economy and efficiency
[Mr. Gladstone.}
in the service. I have found also in my visits to the Department of Public Works, the Department of National Revenue and the Post Office Department a recognition of need for greater cooperation and for an improved system, probably such as a rental charge for space used, to keep the space requirements within reasonable bounds commensurate with businesslike provision for the expectancy of expansion.
Search of the pages of Hansard over previous years reveals a long-time recognition of the fact that estimates have not been presented in a form to be understandable. Quoting from Hansard of June 9, 1928, at page 4,039, on the motion of Hon. J. A. Robb, Minister of Finance, that the house go into committee of ways and means, an amendment was moved by the then leader of the opposition (Mr. Bennett) to strike out all the words after the word "that" and to substitute therefor:
This house is of opinion that the expenditures for the year ending March 31, 1928, and the proposed expenditures for the year ending March 31, 1929, are excessive and extravagant and that the country has not received, and cannot expect to receive, any adequate returns therefrom.
This amendment was debated at some length and finally negatived, after a statement by the Prime Minister (Mr. Mackenzie King) concluding in these words:
Speaking for the government I would say that we would welcome a change in the present method, a change which would not only afford fuller opportunity for discussion but which would carry with it an obligation on the part of the heads of different branches of the public service to appear before a committee of the house and explain fully the reasons which have occasioned the recommendations which find their place in the estimates submitted to the house.
Having said this I would like to supplement my remarks further by saying that if we are not voted out of office as a result of this blanket amendment and if when another session comes around we still retain the confidence of the House of Commons, one of the first matters to which we will ask the house to give its attention and consideration will be the one mentioned by my hon. friend, namely that of arranging some method by which the estimates may to a greater or less extent be considered by a special committee or by the standing committees of the house.
The assurances of the Prime Minister of June 9. 1928, were carried out the next session as recorded in Hansard of February 14, at page 147 on a motion of the Prime Minister to consider the advisability of amending the standing orders so that certain estimates might be referred to a committee. This motion was referred to a special committee, and when the findings of the committee were reported to the house I find on page 461 the following interest-

16S1
The Budget-Mr. Gladstone
mg comment by the hon. member for Comox-Alberni (Mr. Neill):
. . . there is evidence of a tendency to divest this house of a certain portion of its responsibilities and to hand them over to other bodies, sometimes to the cabinet, sometimes to boards, and sometimes, as in this case, to committees.
The gist of the argument of the hon. member at that time was a protest against taking from parliament in any way the full right of discussion respecting the expenditure of money. Doubtless the same objection would be taken to-day, and quite properly so. to a committee on estimates, so that it behooves us to work out some other method by which economy' in the expenditure of money will be practised in parliament as it is in ordinary private and corporate enterprises.
In view of the criticism right across Canada of the cost of government I would urge that supplementary to the royal commission on federal and provincial relations, a definite start be made this year looking to the getting of something more nearly approaching one hundred cents in value for each dollar expended. We have opportunities every day to vote money to be expended; may we not be given an opportunity at this session to vote a modest sum to be devoted to a systematic effort to save money? Each session has witnessed a considerable amount of questioning by the opposition of the day to get at the facts. Apparently the procedure has been to give as little information as possible, and unless the opposition is alert the good henchmen of whatever government is in power sweep through without discussion votes for millions with their "carried, carried, carried." We accept the recommendation of the minister of the department; the minister himself must rely largely on the advice of his staff. With all deference to ministers, present or of the long past, as far as it is humanly possible for them to supervise personally, I am inclined to agree with the observation of one faithful and capable civil servant to whom I talked, that paid servants and not members of parliament to quite a degree control the purse.
The main estimates as submitted to parliament this session, asking for money, occupy in all ninety-five printed pages, including much white space. The Auditor General's report of the expenditures for the previous year occupies upwards of 1.200 pages, for the most part closely printed. Only those hon. members who have behind them a considerable background of parliamentary service and accumulated information can possibly know what it is all about, as millions are being voted. The system is inadequate and unbusinesslike.
I believe I have emphasized sufficiently not only the need but also the desire on the part
of parliament for many years for a better method of presenting and considering estimates. The question is how this can be brought about. The best suggestion I have had from any departmental head is for parliament to tear into some particular phase, and then the officials will endeavour to make corrections; the next year some other phase, and so on-a piecemeal sort of method. I am glad to note in the budget speech that the Minister of Finance has been giving some thought to this matter. I quote Hansard of February 25, page 1227:
The form of our estimates and appropriations, and the method of classifying accounts make it impossible to achieve precise accuracy in such calculations as those I am now placing on Hansard, and I hope that by another year we may be able to introduce such changes in our procedure regarding estimates and accounts as will make it possible to determine more accurately the real costs of the various important services of government. I think members of the house have long recognized the need for the change I suggest.
Speaking as a new and humble member of this house I venture to suggest that this whole matter goes far beyond what may be contemplated at present by the Minister of Finance. If it were only a matter of accountancy and the purely clerical routine of tihe assemblage of data and the tabulation of figures, I have no doubt we have in the departments now many who are competent for such work. But it goes far deeper, to the origin and justification of the proposed expenditure. It is a matter for instance, of enlisting the cooperation of all members in a plan for reasonable economy. All honour and praise is due the hon. member for Hal-ton (Mr. Cleaver) who, promptly after he was elected, cut almost in half certain proposed expenditures in his own riding. But if we fail to follow his example we will leave him looking foolish in the eyes of his electors for missing an opportunity to get Halton more deeply into the public trough. I have discovered a number of instances where the Minister of Public Works (Mr. Cardin) has cut costs, but I also know the pressure he has to resist both from members and in the way of extravagant specifications by departments.
Our economy, Mr. Speaker, is not a matter to be worked out by civil servants. It is a matter that requires much study by this parliament, and non-political cooperation. I find in other parts of the empire confirmation of the importance of detail in estimates. In Hansard of January 19, at page 100, I note the comment of the right hon. leader of the opposition, who said:

The Budget-Mr. Gladstone
paid dividends all through the depression perhaps they can afford to. Indirectly however I believe such a loss would more than be recouped in extra business transacted. I am sure the government would not lose on interest more than would be offset by sales taxes collected on increased business. I will admit that through speculative hazards of mining we would lose, but the loss brought about by many failures would easily be offset by the returns from one paying mine. It would be much better to lose in an effort to give work than to pour money down the sink-hole of relief.
Permit me now, sir, to summarize the suggestions I have been endeavouring to advance. The motor car manufacturers change models annually, but the record of efforts to improve the estimates confirms the suggestion that apparently politics is a handicap to the adoption of anything new. In parliament and out of it we hear much talk of future depressions, and almost a resignation to cycles as something inevitable. I would say that cycles only leave stranded the people in the cities, and wipe out their savings. We must make an adjustment whereby we may be able to achieve more nearly a level by taking from the peaks and filling in the valleys. This surely means reducing the sales tax before reducing the income tax. Overhead is too high in many places other than in government. We must get more nearly to a pay-as-you-go basis. Not only must we balance our budget, but we must reduce our national debt. I have confidence in the leadership of the Prime Minister and his cabinet. They stand for the promotion of trade with all nations, and I believe that therein lies the road to enduring peace.
Internally we need more speedy development of resources, and especially of our minerals. In conclusion may I emphasize that point. Even with some risks, pioneering is the way to progress. The first aeroplane flew only a few feet above ground, and for a very short distance. There is carved on the peace tower these words: "Where there is no vision the people perish." This is our challenge. Let us grasp the vision of greater possibilities and give to youth and to all who by birth or adoption claim Canada as their homeland, the opportunities that should be theirs, where ten million people possess a continental expanse of almost inexhaustible resources.


Mr. A. M. EDWARDS (Waterloo South):: 
An hon. MEMBER:: There must be a reason.


Alexander McKay Edwards: It is an obsession, not a reason. I admit at once that there are certain branches of the textile business that will have to do some explaining on the ground of overcapitalization and .so on, in the light of what has been brought out, but I do not agree that the textile business as a whole should be entirely condemned. There are certain branches of it that do need correcting, but the woollen and worsted business has never been found to be in that position.


Mr. MACDONALD (Brantford):: The
report is not yet out condemning it.


Alexander McKay Edwards: I am not paying attention to that report. The price spreads commission investigated the textile business thoroughly from end to end; every branch was under examination. What was the result? A clear sheet for the woollen and worsted business. Not only that, but after the 1932 agreements were signed-I believe it was a year later or perhaps two years, but one year at any rate-[DOT] when the representatives of the United Kingdom woollen industry came to Canada they put their case before the tariff board and argued that the duties imposed by the treaty were too high. Again, what was the result? The result was that they admitted that the duty on woollen and worsted yarns was only sufficient to equate cost of production as between the two countries, and that the duty on woollen and worsted cloth was inadequate to bring about this equation. That is the situation, and it makes no difference what we say about it. When we think of this branch of the industry and what it means to the different localities in which the mills are located, I suggest that a little more care should be taken in cricitizing the business. I seldom disagree with the hon. member for Selkirk (Mr. Thorson), but I do disagree with his suggestion that the textile business should be sacrificed in order to sell more wheat abroad.


Mr. THORSON:: I never made such a statement.


Alexander McKay Edwards: That is the inference from what the hon. gentleman said.


Joseph Thorarinn Thorson: It is not a proper inference.


Alexander McKay Edwards: I take the hon. member's word for it, but that is what I gathered from what he said. I do not know how you can reduce the manufacture of woollen cloth in Canada, through the importation of such goods, and still expect a man to buy a suit of clothes from the old country or anywhere else and another suit from cloth made in Canada. I cannot figure that out. As has been said many times in this house, and more
The Budget-Mr, Edwards

recently by the hon. member for Lanark (Mr. Thompson), the woollen industry is located in small centres of population and its success must be assured if those who are engaged in it are to survive. There are 500 mills of all sorts throughout Canada located, roughly speaking, I believe, in 150 different cities, towns and villages. In the district of South Waterloo, which I have the honour to represent, there are a number of large industries -quite large-one employing over 800 hands, another 600, another 300 or 400. and so on, and I want to pay this tribute to the textile business and as well to the government that imposed the tariff at the short session of 1930. During the depression years, when in 1933 twenty-six out of every hundred men were unemployed, the textile business saved the situation as far as our part of the country was concerned. In many cases where the girls and women of the household were working in the textile mills supporting the home the father or the sons were out of work. And that happened not in a few eases, but in hundreds of cases that I know of, and in more that I have been told about. Prior to 1930 these mills were working on short time, and in fact in many mills the yarn department was completely closed down. In 1930 the industry was given a break by the tariff imposed by the Bennett government. Prices on cloth-I wish hon. members would get this-[DOT] were in many instances definitely lowered, and the mills were busy because they were able to obtain between 75 and 80 per cent of the home market. The industry did not take advantage of the protective tariff to raise prices but actually lowered them by reason of the fact that they were able to produce more, thereby reducing operating cost per unit.
Canada is a country in which woollen garments are worn during a great part of the year. Our position is such that we require woollen clothing. Surely hon. members will admit that where the people wear woollen clothing six or seven months of the year it can be truthfully said that the woollen industry is indigenous to Canada. I have heard it said so often in this house that goods should come from the place where they can be produced cheapest; for example that woollen goods should be brought from the United Kingdom. But will anyone say that the rubber industry, for example, is indigenous to the United States? Yet look at the tremendous business they have built up in that line. Or can it be said that the cotton industry is indigenous to the United Kingdom? Yet look at the enormous development of that industry which has taken place there. If our manufacturers are to be deprived of the busi-

ness I have mentioned it is going to be just too bad for the 63,000 workers at present engaged in it, together with their dependents. I have not a great deal to complain of in regard to the tariff reductions made and the renewal of the empire trade agreements, so long as our mills are able to secure something upward of sixty per cent of the business. I do not think there is any particular danger so long as that protection is given them. But if we get below sixty per cent of the home market there is very great danger. Surely the manufacturers and workers of this country are entitled to sixty per cent of the home market.
Much has been said about the cost of clothing having been high on account of the tariff. This is definitely not true. If the yarn is brought in to be manufactured into cloth at the 121 per cent duty on the yarn-and it is still lower now with the specific duty off-it will not affect the consumer. I think hon. members will be surprised to learn that the duty on the yarn used in a finished suit of clothes valued at say. $40. is less than 80 cents. Who will say that the 80 cents imposed by the tariff makes any appreciable difference in the cost of the $40 suit? If the cloth is brought in, in the form of worsted, 3i yards to a suit, the duty is not more than $1.75, figuring 16 ounces to the yard of cloth. Would any hon. member say that the $1.75 imposed by the tariff gets to the consumer? Never; it is taken up in the manufacture and in profit to the retailer. The cost of clothing is not in the price of the cloth to any large extent. In a $40 suit of clothes the cloth represents somewhere between $10 and $12; the difference is made up by labour, overhead and the clothing manufacturer's profit. If this protection is taken away it means throwing all these thousands of people out of work, with no benefit whatever to the consumer.
Prior to 1930 sufficient cloth was brought into this country to make a suit of clothes for every adult male in Canada per year. Would anyone say that that was giving the home manufacturer too much of his home market? What was left, when sufficient cloth was brought into Canada prior to 1930 to make a suit for every adult male in the country? When the higher duties were imposed in the short session of 1930 a lot of that was shut off. and jobs provided for thousands of people. May I give the figures of employment in the textile industry from 1930 to 1936?
1930-	50.2G3 on part time.
1931-	50,931 on part time.
1932-	51.030 on part time.
1933-	52.753 on full time.
And so on up to 1936 when there were 63,800 textile workers working full time. That

The Budget-Mr. Edwards
was at a time when out of every 100 industrial employees 26 were unemployed. I repeat, the textile industry did a real national service for Canada.
Perhaps at this stage a comparison of wages paid in the United Kingdom with those paid in Canada, as brought out by the Turgeon textile commission, would be useful:
Cents per hour Canada Great Britain
Woollen industry.	..	30-19	16-90Cotton industry..	..	26-64	16-58Carpet industry..	..	36-28	18-98
The textile industry continues as an integral and valuable part of the industrial fabric of Canada, in the wages it disburses, and taxes it pays, and the amount it expends for freight and other services. It maintains a substantial part of the population of this dominion. So much for the textile business.
I regret, along with other hon. members, that it was necessary for the finance minister to retain taxation on the high level that it is. The sales tax and the excise tax have been fully retained; other taxes, particularly corporation taxes, act as a severe handicap on business.


John Alexander (1874-1948) Macdonald: You do not want the excise tax taken off, do you?


Alexander McKay Edwards: No, but if the hon. member will wait a minute I will give him a solution. This high taxation is indirectly responsible for a lot of the business worries of industrial concerns to-day, and directly and adversely affects the employment situation. I realize, of course, that these taxes must be imposed under present conditions; there is no doubt about that. But I make a suggestion, for whatever it is worth. I suggest to the minister that prior t-o bringing down the next budget, careful consideration be given to the idea of putting into force the turnover tax as a substitute for many of the nuisance taxes which we have to-day. I realize that this suggestion will require considerable study, but I leave it with the minister, after quoting part of a speech made some years ago by Sir Edmund Walker, addressing the annual meeting of the Canadian Bank of Commerce. He said:
"A small tax on the sales of commodities and real property in Canada would hurt so little, would be so fair, would be so easily collected, and would produce such a very large sum that to fail to levy it seems excusable only if it can be shown to be impracticable."
I leave this quotation with the finance minister to ponder. It is not anything new, but I think it is worthy of consideration.
I should also like to suggest to the government, in view of the recent decisions given
by the privy council, that during the recess a real honeslt-to-goodness attempt be made by this government and the provincial governments to get together and devise some plan under which social legislation may be made workable on a national scale. I refer particularly to the minimum wage act, unemployment insurance, and old age pensions. Although of course it has been decided that these are provincial matters, I do not see how they can be successfully handled in any disjointed way, and I suggest that every effort be made to place them on a uniform national basis.
The home improvement act is to be commended. I commend the Minister of Labour for that; I think it is beginning to show good results in the building trades. It has been stated that 83 per cent of the cost of building is labour, so that it means a great deal for the working men and mechanics of this country-and not only those actually engaged in the building trades; it goes much further back. The hon. member for Brantford I think will back me up when I say that it goes back to the machine shops; there it is very noticeable. I suggest, however, that the interest rate on these small loans should be reduced to the minimum.
The suggestion has been brought forward by several hon. members that a duty or quota or both should be imposed on vegetable oils coming into Canada, and as a result I have received many communications from farmer constituents asking what will be done. From what I can gather, the importation of vegetable oils from foreign countries is an ever-increasing menace to the butter fat producers of Canada. This question is now before the tariff board, and careful consideration should be given the findings of that board. If the threat to our dairying interests is as great as it is reported to be, I suggest that action should be swift and sure.
Last session I protested against the reduction in the duty on furniture coming into Canada from the United States under the agreement. I want to tell the house to-day that the fear I then expressed has been abundantly justified. The furniture industry in Canada is in very bad shape. I do not say this is entirely because of our imports from the United States, but that has been a major contributing cause to the troubles of the furniture industry. I was informed lately, and I believe the information to be correct, that either the government of the United States or the governments of individual states, I do not know which, have subsidized factories that had been closed in large centres in the United States of America. These factories
The Budget-Mr. Edioards

have been reopened and a good deal of the output is coming to Canada. To quote statistics again, imports of wood furniture for 1935 amounted to $286,746. In 1936, following this agreement with the United States, they amounted to $663,634; in other words they were about three times as great. For January of this year, the last month for which complete figures are available, wood furniture valued at $84,001 entered Canada from the United States, and this at a time when the industry here is struggling for existence.
I am surprised that many other hon. members of this house have not brought this serious situation to the attention of the government. There are very few Conservative members representing ridings in which furniture is made, but many Liberal members represent constituencies in which there are large furniture factories. All these members need do is go and inquire as to the facts, as I have done in several cases. Let them go into these factories; let them find out what the situation really is; let them see the reason for the low wages that have been paid and the strikes that have occurred. If they do that I believe they will have something to say to the government which they support, if they do their duty by their constituents.


Mr. DEPUTY SPEAKER:: Order. I must tell the hon. gentleman that his time has expired.


Some hon. MEMBERS:: Go on.


Alexander McKay Edwards: We hear a great deal about the high protectionist policy of the Conservative party, but right here I say, with no fear of successful contradiction, that this is an absolute myth, that it is not true. As I understand it. the tariff policy which I support is one that asks a tariff simply sufficient to equate costs as between Canada and the country that is competing with us in order to give our manufacturers a fair break. That is all.


Joseph Thorarinn Thorson: Since when?


Alexander McKay Edwards: That has always been our policy; that has always been the attitude of the Conservative party, but the high tariff bogey always has been used by the Liberal party as a peg on which to hang the argument that ours is a high protectionist policy.
In closing, Mr. Speaker, may I again suggest that the government give greater consideration to the balancing of business instead of paying so much attention to the exportation of any particular commodity. Only by adopting this principle may we expect to relieve the treasury of the terrific burden caused by the unemployment situation.


Mr. WILFRID GARIEPY (Three Rivers):: Mr. Speaker, as a Liberal of independent leanings representing a riding with a strong labour complexion I wish at the outset to congratulate the government upon having appointed the textile investigating commission. It has been a blessing to the country. We have been very fortunate in having as chairman of that commission a gentleman of high culture, integrity and energy, assisted by counsel, Mr. McRuer, a leader of the Canadian bar, well equipped to bring out the facts, and ably supported by a leading member of the Montreal bar, Mr. Beauregard. While the report of the commission has not yet been presented, sufficient evidence has been adduced to enable us to draw some conclusions. In the first place, the real capital invested in these factories has never been properly disclosed. Second, in many cases the profits were hidden.


Mr. CAHAN:: Mr. Speaker, on a point of order; I would ask for your ruling whether it is open to members of the house at this time to discuss a subject now under investigation by a royal commission with respect to which no report has as yet been received or laid before the house. It is unprecedented that such a matter should be discussed prior to a report being made by the commissioner.


Ernest Lapointe: I quite agree with my hon. friend, Mr. Speaker, but I am sorry he did not raise the point when the investigation was being criticised by members on his side of the house.


Charles Hazlitt Cahan: I was not here; I heard no such criticism.


Ernest Lapointe: My hon. friend is correct in his point of order, I think, but the commission was criticised by many speakers on the opposite side of the house.


Charles Hazlitt Cahan: If there has been any backwardness on the part of members to raise objection, I now raise it distinctly, and I ask for a ruling. Otherwise we open the door to a discussion that may last not weeks but months.


Ernest Lapointe: I agree with my hon. friend, but I do not congratulate him on his impartiality.


Charles Hazlitt Cahan: I would ask for the Speaker's ruling.


Frederick George Sanderson: I shall take the point of order raised by the hon. member for St. Lawrence-St. George (Mr. Cahan) under consideration, and give my ruling later.


Wilfrid Gariépy: It follows clearly. Mr. Speaker, that the high tariff which has been in

The Budget-Mr. Gariepy
existence for the protection of the textile industry had not its raison d'etre, was not a real need, and that the arguments presented to this house and the country were without any real foundation. Conditions of labour warranted the complaints that were being made throughout Canada, and it seems to me it was a step in the right direction when last session the attention of the house was directed to the strike of employees of the Wabasso Cotton Company in Three Rivers. In my view the complaint invited some remedy. No doubt cognizance of the circumstances has been taken in the preparation of the budget, which on the whole I would say is well balanced. It includes provisions which are compatible with real progress, and the budget presentation was on a par with budget speeches made in the past by such leading statesmen as Mr. Fielding and Mr. Robb.
The present Minister of Finance (Mr. Dunning) has a knowledge of both western and eastern conditions. I knew him before he became a member of the legislature of Saskatchewan and I believe he may well take credit, with the means at his disposal, for rising through sheer ability and force of character to the important position he now occupies in the government.
I listened with keen interest to the observations yesterday of the hon. member for Ontario (Mr. Moore). He knows his subject, and many of the statements he made will not suffer contradiction. But this is not an idealistic world; we must face facts and conditions. If external trade is to be developed, agreements are essential, and the government is to be commended upon what it has done in that direction. It has effected agreements with the United States and with the mother country. I would go a step farther and say that before long I hope that similar agreements will be made with Belgium and with France. By the way, one does not hear much about Canada's representative m France. Our present representative the Hon. Philippe Roy, is an old friend of mine, but his physical disability, I think, deserves the attention of the government. Though diplomats should not always be listening, they must be able to hear. I suggest the time has come when improved representation of Canada in France should be made. I do not say this by way of criticism, but with all due respect I suggest that the members of the government are broadminded enough to expect hon. members addressing the house to speak their minds.
One matter which I think requires attention is with respect to answers given to questions placed on the order paper. Owing to pressure
of business, ministers must leave to their departmental officials the duty of answering these questions. Perhaps the officials do not understand the mentality or sufficiently consider the atmosphere of the house. A few daj's ago the hon. member for Quebec-Mont-morency (Mr. Lacroix) asked what steps were being taken against communism in Canada. The answer given was: "Such means as are proper for the preservation of peace and order." I say that does not go far enough; it is not satisfactory. If the government had said, "For reasons of state we cannot disclose the situation," that would have been understood, but when same answer is attempted to be given we should be told in all frankness whether or not something is being done. I have it on good authority that in the city of Montreal there are at least two hundred communist clubs with active memberships, initiations, recruiting organizations and all the various means of propaganda. After visiting my home constituency of Three Rivers last Saturday, I can vouch that in that part of the province in season and out tons of communist literature are being distributed. I am not an alarmist, nor do I mean to suggest that this alone will bring about revolution in a, month or a day; but the point is that we in parliament should keep our eyes open. The matter should be investigated more than it seems to have been, if we may judge by reports received in the house.


Ernest Lapointe: Does the hon. member know that if seditious literature is distributed or propagated anywhere, it is for the provincial authorities to put the law in motion? There is a law against it.


Mr. MICHAUD:: I understand that is the constituency represented by the Attorney General for Quebec.


Ernest Lapointe: Exactly.


Wilfrid Gariépy: The point I make is that the two powers should work in conjunction. I do not think in a matter of such importance the ball should be thrown from one to the other. I am not criticizing or complaining, but I do say we should attend to this thing before it has gone too far. If it is a matter for direct provincial intervention, then no doubt something should be done from that end. At the same time I submit the federal government should follow what is taking place, and see to it that proper remedies are applied.
Again referring to answers to questions, may I say that on three occasions I have asked the names of employees engaged in government work on the St. Lawrence river, a matter under the control of the Minister
The Budget-Mr. Gariepy

of Transport (Mr. Howe), who is not now in his seat, but to this date I have not received the information. Last session the hon. member for Nicolet-Yamaska (Mr. Dubois) sponsored a resolution requesting that the government consider the advisability of appointing experts to look into the building of a bridge over the St. Lawrence river at a point opposite Three Rivers. Later the same hon. member again asked what had been done and the answer from the Minister of Public Works (Mr. Cardin) was nothing-no word of explanation, and no report of any kind. I say, Mr. Speaker, that the instructions of the house are not being followed, and that an answer of that kind is not satisfactory. In the province of Quebec we have unemployment, just as in other parts of Canada, no more and no less. I am not blaming the government for not doing more than it has done, but at the same time conditions in my section of the country warrant taking all means at our disposal to improve labour conditions. If construction of this bridge I mentioned a moment ago were thought advisable, it would certainly afford work to many people. It would seem that money can be found to finance the construction. If hon. members look at the map they will find that the bridge would be in the very centre of the province and would serve almost a million people. It would be the last link for a direct connection between the north shore of the St. Lawrence and the United States boundary.
This is work which would not prove very costly. Votes have been passed for armaments and for other things. The province of Quebec has joined with other provinces in contributing to direct relief, and it seems to me that some of the money might have been used in Quebec for useful projects such as the one I have mentioned.
A moment ago I mentioned that we are a confederation of component parts which decided to unite; but still retaining their original identity. Prior to 1867 Lower Canada was a self-governing body, so far as it could then exist. It did not give away any of its essential powers when it entered confederation. The majority of the population of the province of Quebec are French-speaking, but this is not the essential point in my argument. If complaints are made by my province, they should be considered in the same way that complaints received from Upper Canada were considered in the days of William Lyon Mackenzie, and from Nova Scotia in the days of Joseph Howe.
I come now to a delicate matter, but one to which serious consideration should be given.

I think we have reached a point where it must be said that the civil service commission is nothing less than a menace to this country. I could give many instances which have occurred throughout the whole province of Quebec, but I shall illustrate what I have in mind by referring to certain incidents in the city of Three Rivers.
A year ago the Wabasso Cotton Company had a strike, and a delegation of its employees was sent to meet the Department of Labour at Ottawa. There were eight French-speaking employees who met Mr. Dickson, the deputy minister of Labour, and certain members of his staff. I was along also, and for hours the discussion was carried on through myself as interpreter. There was no French-speaking employee available in the department to listen to the views of these employees.
In the city of Three Rivers the mounted police is headed by Mr. Chamberlain, an English-speaking official. I have nothing to say against his ability, but he is being retained there in spite of protests. These protests are not being made because of his inability to perform his duties, but because Three Rivers is more French than any other city not only in Quebec or in Canada but in the whole world.
I could go on and give many other instances. Last summer a wharf was being built opposite my city. An engineer from the Department of Transport would come down for a few days each week to inspect the work. This gentleman was very able, but he could not speak one word of French, yet all those with whom he had to deal were Frenchspeaking.
Just a few days ago an audit of the books of the Three Rivers harbour board was ordered by the government. This audit was conducted by two well educated gentlemen, both graduates of . good schools, but neither of them could speak French. They were there for two weeks checking books in an office where nothing but French is spoken. I am not blaming the government or any minister of the government; I am blaming the system. There must be interference of some kind. Just picture an auditor not able to speak a word of English being sent to audit books in the city represented by the hon. member for Broadview (Mr. Church). He would not last two hours; he would sooft find himself in the waters of lake Ontario. We, too, have water in the St. Lawrence, and, Mr. Speaker, it is deep.
I do not want to appear to be harsh about these things, but I must tell the house what

The Budget-Mr. Gariepy
has happened. Much has been said about the dissatisfaction existing in the province of Quebec. We have even had the younger element speaking of secession, but I am not of that school. If this is not a matter of dollars and cents, if it is not a matter of a share of the patronage, it is at least a matter of self-respect and dignity. The two million people of our province must receive some consideration, and I raise this question in the hope that some means may be found to do justice to the population I represent. I am not speaking for this or that individual; I am speaking for a group, and I want results. Something must be done to give satisfaction and to improve the service.
I have just one more remark to make in this connection. Last session we properly voted $10,000,000 to close the relief camps and provide work on the railroads throughout the country. This vote was criticized by the hon. member for Kootenay East (Mr. Stevens), but apart from him I think we were all of one mind as to the propriety of making that move. Mr. Humphrey Mitchell, a good friend of mine, a man with great ability and a former member of this house, was put in charge of the expenditure of that $10,000,000. I will admit he did not do too badly for us in the province of Quebec, but the fact remains that he was not able to speak French. He could not talk to the men who came to him to get work; he could not make the right contact with our population. Here is a case where the expenditure of a few paltry dollars would have provided a bilingual assistant.
I wish to call attention to a remark made yesterday by the hon. member for Kootenay East (Mr. Stevens). He was emphasizing the importance of doing away with the party spirit as we have it in this country, but the example he chose was a bad one. for he said that fifteen Liberal members had stood in their places and denounced the government's defence policy and then like sheep voted for the very policy they had denounced. For mv part I wish to protest against that statement. The hon. member did not live up to his reputation; he is usually more fortunate in expressing himself. He should remember that it takes more courage to dissent than to be a "yes-man." In that particular situation the position was clear, although it may not have been clear to the hon. member and others. Speaking for myself, I am not against a policy of expenditures for the defence of this country, but to my mind the amount that was proposed, the increase intended to be made, was not justifiable; it was too large. That is where I drew the line. With the
general policy of the government I was in perfect accord, but in regard to this increase I raised a protest, and under the rules the only way to do it effectively was by voting on the amendment to reduce that amount, which was done in committee of the whole house. No other course could be followed. Besides, in spite of what has been said, another aspect of the situation has appeared in the newspapers without any contradiction, and I mention this as a reason for hesitating before we follow our leaders. The following statement appears in Saturday Night of February 27, at page 4:
The 1937 program now before parliament is simply the 1933 program resubmitted. .	.	.
The memorandum with which the general staff submitted it to the government stated specifically that the purpose . . . was to enable Canada to contribute and maintain an efficient contingent in the event of trouble for the empire.


Frederick George Sanderson: Order. I think the hon. member is out of order, because he is referring to a former debate which is closed. I will ask him to confine his remarks to the budget debate.


Wilfrid Gariépy: I had completed my
remarks on this score, but I wanted the hon. member for Kootenay East to be informed as to the stand I took on this matter.


Ernest Lapointe: While on this point, may I ask my hon. friend whether he prefers to take the word of Saturday Night to that of my right hon. leader and myself?


Wilfrid Gariépy: Mr. Speaker, since you have decided that this matter is out of order I shall not enlarge upon it. but I think I could give a reply to the question of the minister which would not reflect on his integrity, honesty of purpose or ability. He knows well the esteem, regard and consideration that I have for him. I have followed his career for years. I know from where he started, and to-day in this house he enjoys the respect of one and all. He is an authority in matters of government. But he, like othe* ministers, must take advice from those surrounding him, from members of his staff. He must read reports. He must appreciate them, each one uses his own judgment. In the past the people of this country have been misled, not intentionally, quite without bad intention on the part of any of those concerned. In the minds of those who gave the advice there were no doubt good reasons at the time the people were invited to endorse and follow a certain course, but afterwards it was found out that through lack of proper information some mistakes had been made. In this case, which was so important, I decided after consultation and study to take the stand

The Budget-Mr. Gariepy
that I have mentioned. I did so with all due respect to my leaders, who should not forget that the same kind of debate arose in 1922 over the same principle, over figures of the same kind, and-


Frederick George Sanderson: Order. The hon. member is out of order.


Ernest Lapointe: And that is not an answer to my question.


Mr. GARIEP  Y@: Mr. Speaker, I bow to your decision. I did not intend at all to transgress. I want to respect your decision, and if I erred it was because I wanted to deal justly and adequately with the remark that was made by the minister who asked the question. I desired to show my good faith. I have no personal object to serve in this matter; it is a question of doing my duty to the public, of being fair to those who have elected us.
I have spent a considerable time in the west. I served for some years as a minister of the crown, and on every occasion I have manifested my respect for British institutions, and I have never said anything disparaging of the great flag under which we live. My stand is written in black and white in all the books in which my observations while I was a member of the legislature have been recorded.
The budget which we are now discussing has been accepted with great enthusiasm throughout the country. Much has been said of the needs of western Canada. With those views I do not disagree; on the contrary I intend to support every expenditure for the provinces of Manitoba, Saskatchewan and Alberta which, as we all know, are so hard hit at the present time. But it should not be forgotten that if we are able to do something for these younger sister provinces it is because the older provinces have developed themselves, have maintained relatively a sufficient prosperity, and have contributed substantially to the credit of the country as a whole. I think the time has come to state t3iat the old provinces of Ontario and Quebec should also receive from the public treasury some measure of consideration. I may be told that this is a matter of provincial politics, and it is to some extent. But I have been satisfied for some time that the agricultural parts of the province of Quebec are suffering from a lack of proper production and proper marketing. We have there the oldest farming lands in the country, splendid stretches that have been occupied for ages by farmers of no mean ability. But, though I am not a specialist in that line, I am convinced that the efforts of these toilers could be better directed so that their

products would be of better quality and more varied; and then these products should be marketed to better advantage. There is lack of organization and coordination. I wonder whether one of these commissions created by the government could not give some time and attention to this problem.
I am not going to weary the house with details but I have no doubt that some man like Doctor Tory, who was at one time the head of the National Research Council, could if so instructed get to the root of the trouble and suggest ways and means whereby some improvement could be brought about.


Joseph Enoil Michaud: Is my hon. friend aware that the privy council has recently told us that it is not our business to deal with these matters?


Wilfrid Gariépy: I will not enter into' a legal argument. I prefaced my remarks with the statement that it was essentially a provincial matter. At the same time, here we are dealing with matters almost of the same kind in other provinces. It may be said that the marketing of wheat is something related to commerce and trade and is therefore a dominion subject. Well, it might be made a matter for the dominion to deal with if we wished to improve marketing conditions for the farmers of Quebec and to secure better markets for their eggs, butter, cheese and all the other products of the farm.


Joseph Enoil Michaud: For export?


Wilfrid Gariépy: Quite so. I am sure an investigation would show that not enough has been done to help the farmers of the province I come from. I will not say that they are in a very bad way, but they are not as prosperous as their toil and the natural resources at itheir disposal should make them. Their organization, I repeat, can be improved upon and I trust that the government will look into this phase of the economic situation in the province of Quebec.
As I said at the beginning, with slight changes, this budget is on the whole satisfactory to me and (for that reason I am going to support it. I support it with confidence; I support it with enthusiasm; I support it, satisfied that ithe members of the government are fair-minded enough, in this favourable year, to take into consideration the remarks I have made, especially with regard to the public service and the work that is done throughout my province. There is a grievance there, a serious grievance; but I am not making an appeal for sympathy. I leave it to the judgment and the business sense of everyone here. Peace-loving as the

The Budget-Mr. Taylor (Nanaimo)
electors of my riding may be, when it comes to dealing with the government of the country they want to meet people who can understand them and get at the substance of their ideas, people with whom they can really fraternize. This can be done, and there is no reason why we should not satisfy the people of Quebec in this regard. I trust that at the next session when I speak again I shall have the pleasure of congratulating the ministers and of acknowledging that a step has been taken in the right direction and some real improvement brought about.


Mr. J. S. TAYLOR (Nanaimo):: The final accomplishment of any worthy task constitutes its greatest merit, and it is a great thing for humanity that that merit first falls to the performer of the task. For that reason, therefore, I congratulate the Minister of Finance (Mr. Dunning) on having brought to final accomplishment a very arduous task well and truly performed. But when I say that, what is that task? What does the budget teach us? To me. unfortunately, it is a tale twice told, as flowing water dammed again.
It is true the minister draws attention to the fact that we are entering upon better conditions and that happy days are near again. But I am reminded of a saw in common parlance in the British West Indies, appropriate to the days of horse-drawn vehicles. It runs: Up the hill hurry me not; down the hill worry me not; on the level spare me not. And so because the minister conceives that Canada is now running on the level road he still spares not the tax-ridden, war-worn and depression-wearied citizen. But, unfortunately, Canada is not running along the level road, and all too soon that fact must become apparent even to the minister himself, whose historically orthodox approach to all the problems of finance places him in a niche almost entirely by himself, admired it is true by the monitors of big finance, but almost too far removed from the flow of our world's affairs to be of real fundamental value to this country. I am saying this very deliberately. I said it last year. I accused the minister of having produced a banker budget, conceived and worked out by an orthodox banker mind.
This budget of 1937 is last year's brother, and it carries the generic weaknesses of the family. I want this statement to be a condemnation of the minister and the government in so far as they are responsible, because in spite of their real honesty of intent, which I am daily coming more and more to recognize and respect, there is nevertheless an underlying sense of sophistication which tends to render them oblivious of the changing times and conditions in which we are now
living, and causes them to inhibit the practical connotations of the archaic efforts to which they commit themselves. It is for these reasons that the first budget was conceived in a desperate and uncompromising attempt to balance the accounts of the nation, malgre the wails of the homeless and the curses of the frustrated. The younger brother of to-day is only slightly less unyielding, save in the matter of national defence, which has been very much contested, and with some sops here and there to the wailing. Let me say again, some sops here and there to the wailing. But why does the minister soak the sops in vinegar? I received a telegram from Vancouver dated March 8, which I shall read to the house:
Blind people in British Columbia beg your aid in house protesting unnatural inhuman marriage clause blind pensions bill wherein blind persons marrying are penalized by losing half pension. This would only prevent civil marriages and encourage irregular situations. British Columbia with 650 blind persons has had only seven both blind marriages, all in Vancouver, with only one child to each of two couples. We estimate total both blind marriages in Canada about 70 therefore problem not serious. We regard as unfair to deserving citizens the twenty year residential qualification. The calamity of blindness may strike worthy citizens any time and we suggest ten years' residence. Recommend no limit be placed on permissible earnings over pension by blind. Protest meeting held in Vancouver to-night.
Canadian Federation of the Blind, Mrs. E. Scott, secretary, and John Munro, president.
So the government, in giving, gives with one hand and snatches away with the other. Still the have-nots are plundered and the haves scarcely feel the drain; still to-day the working man hangs nailed to the cross, pouring forth his life blood for the salvation of the rich. I am not for one moment losing sight of the levies paid by the industrialist and the primary producer, but in our economy today we live with the idle rich and the idle poor, and in effect the worker has to keep them both. These two idle groups, the contributory and the non-contributory, those living with their hands in the pot, and those scarcely existing on hand-outs from the pot, are the reasons annexed to the economic difficulties of our position. The one cannot be considered apart from the other. The necessary flow of our economic affairs is already developing a delta in the river of production, and the arm called national revenue is broken into one large branch which one might call the interest reach, diverting 30 per cent of the flow, while another large branch is digging its way tortuously through the deltr growing year by year, and in 1936 it absoroed and diverted another 30 per cent of the flow.

1698	COMMONC
The Budget-Mr. Taylor (Nanaimo)
I refer to the relief channel. It attained that percentage by adding war relief figures to the ordinary relief problem. This represents 60 per cent of the effluent, and is a truly staggering proportion.
Let us figure this out. The available national financial capital of the country, symbolized by the idle rich-I say symbolized- and the available human capital of the country, symbolized by the idle poor, together demand 60 per cent of the nation's revenue, and return nothing to the country but the continued existence of the obligations. The two arms I have spoken of are steadily growing and will unquestionably come together unless the government in general and the Minister of Finance in particular will make a speedy and earnest effort to realize and act upon some of the profound truths in economic heterodoxy. It is suicidal to the country and to us all to refuse to change. If the present safety of the country depends on concessions to orthodoxy, then I assure the house that the future safety of this country will be assured only by facing facts obvious even to the man in the street, and by preparing entering wedges born of sound understanding which will, for instance, prepare interest for its proper place in our economy. I say, prepare interest for its proper place in our economy. This is a big subject, and I do not propose to discuss it fully this evening, but I want to cast one thought into the pool.
We are recording constantly the failure of housing. Housing demands loans; loans demand interest. The potential householder hesitates to build because he sees all around him houses forfeited to the mortgagees and lost because of tax imposts. There is no reason I can discover why interest should be a first call on repayment. The government might do well to consider, and if possible enact, that all repayments shall be at least in part repayments of principal, and that the principal outstanding shall be the only basis on which interest is charged; and once the principal is repaid, there remains still the repayment of deferred interest and interest due.
Another entering wedge which might easily be prepared is one which will assure to every citizen in the country not merely a starvation existence or all-but-withheld dole, but an existence determined by the productive capacity of the country, subject only to its natural resources.
Another entering wedge should be prepared in view of the fact that the unemployed in the country are largely unemployable in nor-

mal avenues of production, and while no man or woman or child in Canada should at any time go without food, clothing or shelter, the assurance of these cachets to existence carries with it the responsibility of service to the country; therefore an amazing increase of social service by its people should be discovered, invented and devised to take the place of self-destroying idleness and frustration. Has the government grasped the significance of that statement: self-destroying idleness and frustration? To-day in Canada the young suffer with the old. Is youth developed in frustration? Is it right that youth should be frustrated? Go into the forest and look about you. There you will see trees which in the early days of their growth were frustrated; stunted in growth, gnarled and twisted and ugly, they point a lesson which we dare not neglect. As with the tree, so with the man. Let us in Canada beware. Until every citizen of Canada is freed from his present distress; until every citizen can face the future with the assurance of suitable and adequate food, clothing and shelter, no government, no minister of finance, and no minister of labour can be considered to have earnestly and effectively grappled with the necessity for economic adjustment which is compellingly evident, or even to be worthy of the full approval of the citizens.
To do all this demands a premise different from that presented by the Minister of Finance (Mr. Dunning) when he said in his budget speech, at page 1213 of Hansard:
Profits are the mainspring of economic activity in the system under which we operate. Increasing profits are therefore the best augury for increasing employment, the best indication of the approach of the day when private industry will be able to release governmental bodies from the enormous burden which they have had to bear in recent years.
Let us face this: It will be at least two years from this date, as presaged by the Minister of Finance, before the budget can be balanced. Then must come an expansion of expenditure due to the needs of the country which were neglected during the years of deficits. Grant, however, that Canada is facing a lengthy era of prosperity; for the next sixty years give her an average surplus of $25,000,000 per year. What do we find? Two generations still to come will have succeeded in wiping out nearly half the present national debt, and they will hand on to their children and grandchildren an obligation contracted by forebears whom they scarcely knew, and whom they cannot respect as worthy citizens of a country which we hope will still be in that day a worthy country in which to

The Budget-Mr. Taylor (Nanaimo)
live. I suggest, Mr. Speaker, that instead of attaching himself to such a premise the minister should endeavour to discover and appreciate the value of this better metaphor: The needs of a people are the mainspring of its economic activities, and the profits from these activities are the hairsprings operating the escapement, and so governing those activities.
Is there anything wrong with that idea? Is it not more true to actual facts? In crude form the post office and the postal system are developing along these lines. Is it not possible to bring the same sensible formula to the development of our natural resources and public utilities? We must come to it; why not face the facts and prepare for it? The minister must surely see that in this form of national activity is presented the truest form of thrift-and I use the word in its true etymological sense-and of progress. Let me read what the minister has said with regard to thrift, at page 167 of Hansard, and repeated at page 1392:
Moreover, sir, I still believe in the virtue of thrift, I still believe that a man in the full flush of his manhood has not merely the right but the duty to himself and to those who depend upon him to set aside in any manner which seems good to him a portion of the proceeds of his labour to-day in order that he and those dependent upon him may not later be dependent upon the state.
If it were possible to ensure the success of every investment of the frugal and saving youth who so loves his country that he does not wish to become a charge upon it, and therefore withholds from his present dependents and from himself, in order that he may give the fruits of the fruits of his labours to his future failing self and his future failing dependents; if it were possible to ensure that these investments would give satisfactory returns to this intrepid youth, there might be something in what the minister has said. In effect, however, the youth is exhorted to withhold from his present fullness in order to cast it into the whirlpool of investment, the major force of which is purely speculative, and the vortex of which is very largely disorder and- loss.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


James Samuel Taylor: Mr. Speaker, when the house rose at six o'clock I was in process of questioning the minister's 31111-107J
exhortation to thrift, and I did question that word thrift as being scarcely applicable in its true etymological sense. I think it was rather intended to convey the idea which in its tenor from comparative to superlative runs through savings, frugality, parsimoniousness, penuriousness, niggardliness, miserliness and sordidness.


Charles Avery Dunning: I didn't mean that.


James Samuel Taylor: But if that is the meaning of thrift in its mild form, which the minister implied, then I want to draw attention to some facts. The minister still believes in the virtue of thrift, and I want him to understand that I am not in any sense unkindly or cynical in the sense in which Mark Antony was, when I say that the minister is an honourable man, and so are they all, all members of the government, all honourable men.
But still believing in the virtue of thrift let me read what thrift did to a man in Vancouver. This is a letter I received shortly after the date it was written:
2930 Granville street,
Vancouver, B.C., Jan. 4, 1937.
Mr. J. S. Taylor, M.P.
House of Commons,
Ottawa.
Old Age Pensions
Dear Sir:
Knowing that you are especially interested in the general welfare of old age pensioners, I am taking the liberty of calling the attention of parliament, through your representation, to one or two weaknesses, or injustices, of the Old Age Pensions Act, and also of asking the question why it is our Canadian government penalizes thrift.
To state my own case briefly, and there must be many others in a similar position, I am in my seventy-second year and have been receiving a small old age pension during the past fifteen months. I worked at my trade, lithography, in Scotland and in Canada dose on fifty-five years. On January 27, 1931, while still employed, my wife and I purchased a Canadian government annuity, policy number 13078. which cost $2,980.80, and which brought us in the sum of $20 monthly, which sums were immediately transferred to the savings bank, as they came to hand. On August 16, 1933, being now permanently unemployed, my wife and I withdrew from the bank the $620 received in cheques from the above mentioned Canadian government annuity, and added to that sum the balance of our savings, $2,827, making the sum of $3,447, and purchased another Canadian government annuity, policy number 17354 value for the sum of $25 monthly which, the two policies combined, bring us in a total of $45, or $22.50 each per month.
On attaining the age of seventy on October 1, 1935, I made application for old age pension and discovered that, because my wife and I for fifty years (just passed our golden wedding
1698	COMMON'S
The Budget-Mr. Taylor (Nanaimo)
anniversary) had been thrifty and saved wherever we could, and then handed all ($6,427.80) back to the Canadian government, this same government in return penalizes me to the extent of $12.18 per month or in other words, I am awarded an old age pension of $7.82 per month instead of the recognized $20 per month. The British government does not penalize good citizenship and thrift!
In conclusion, I may say that our income and expenses per month are as follows:
Income-
Canadian	government	annuities.. .. $45	00Canadian	old age	pension	
7	82
Expenses-
Kent	
$20	00Gas, light, etc	
2	82
Income	$52 82
Rent, etc	 22 82
Divided by two people. .	30 00
$15 00 each, or 50 cents a day.
Fifty cents per day each for food, clothing, incidentals. What a glorious achievement for fifty years of self sacrifice, plus a sum of nearly $6,500.
I am,
Yours sincerely,
Henry Jas. Rhodes.
Let me earnestly ask the minister if he considers that Henry James Rhodes and his wife, who have metaphorically toiled all night and caught nothing, should be satisfied with the sacrifice they made for their country to save it the expense of $12.18 per month-$20 less $7.82, for the absolutely unpredictable life of this worthy citizen now already seventy-two years of age.
Is it not realized that Mr. and Mrs. Rhodes would have been far better off if they had spent their savings in a leisurely trip all round the world for nearly two years-let me say two years less One day, in order to put them within the provisions of the act-returning to the shelter of the unworthily called old age pension, for the evening of their days? What benefits could they not have conferred upon those they were destined to meet if they could have related all their experiences, and said that their country honoured them for their long service, their honesty of effort, their sterling citizenship and those qualities which reflect the highest worth of its people? To-day, every month they receive another painful reminder of the ashes of effort which too often render miserable the worthiest people. And the government of this country can enter a

*wedge which will change all that. Is it too much earnestly to implore them to consider it and do it-and do it quickly?
Many points remain to be spoken about in connection with the budget speech, but I want now to refer to one which appears at page 1216 of Hansard. Having partially explained the obvious failure of employment to keep pace with the striking gains in business activity previously reported, the minister (Mr. Dunning) goes on to say:
For the rest, the explanation rests upon the progress of invention and the improvement in technical and managerial processes. To this extent it is a phenomenon which is usually met with in the early stages of recovery from depression. As it indicates an increased efficiency in the productive mechanism, its results are not to be deplored. Its ill effects are temporary: in the long run it increases employment by cheapening production and expanding consumer purchasing power. As recovery gathers momentum, increases in employment will tend to conform more closely to expansion in business activity.
With all due respect to the minister, I fail entirely to understand how he can make that statement without fear of being accused of terminological inexactitude. Invention and discovery grow like snowballs rolling down a mountain slope. Machines become more effective and more labour-displacing. Our present economy indicates no possible way by which the wage earners can avail themselves of the products which increase the complexity of our already too complex lives. I quote again briefly from page 1223 of Hansard:
The sales tax is now the largest single source of governmental revenues.
This tax meets with strong abuse and opposition. It is for that reason that it gains a certain amount of consideration from me, because nothing induces me to study a thing more than the realization that it is opposed. I am disposed to believe that it will be many years before we can get rid of the sales tax. Having considered the matter carefully, I have come to the conclusion that if we must have this tax, I doubt if there is a better tax, provided it is properly levied. It is by all odds the easiest and the simplest tax to levy, and the easiest and the simplest tax to collect. It is a tax placed directly at the point of consumption, and thus is prevented that woeful pyramiding which lies between the importer of dutiable goods and the ultimate price to the consumer, where importer, jobber, manufacturer, wholesaler and retailer all exact percentages of profit on the moneys they spend for duty as well as on the money they spend for goods. This is not

The Budget-Mr. Taylor (Nanaimo)
pure taxation, and .some method should be devised by which all charges should be assessed for payment at the point of purchase for ultimate consumption. I confess that the question bristles with difficulties, but I want to draw the attention of the house to the facts as they exist.
The minister has told us that approximately 380,000,000 is received in customs duties. I dare say that an undefined and probably undefinable amount less than $80,000.000 could be recovered if the minister could devise a method by which it could be levied at the point of ultimate consumption. It is quite possible that at least $20,000,000. and probably up to $50,000,000, could be secured if machinery could be devised to handle it. Unquestionably it would represent an increase in the amount of duty, but it could be tried out in connection with certain commodities which could be easily traced by the government, such as motor cars or other large and costly items.
However, the sales tax itself is very effective and is relatively complete, but I suggest to the minister that if he must continue this tax, he should preserve this ideal and remove all present tendencies in any other direction. I further suggest that whole or at least partial relief from sales tax should be grantedi on those commodities which are the necessary subsistence items of the poor. The crumbs that fall from the rich man's table should neither be grudged nor minished, nor should they be made difficult to gather. That, sir, is the least kindly way of expressing a very real idea.
The next point I noticed in the budget is one to which I draw attention with considerable pleasure. It is a welcome innovation and. constitutes an almost epochmaking provision. Its advantages should be demonstrated to every minister of finance who will follow the present minister. I refer to the issuance of perpetual bonds in the field of the nation's debt. The minister states at page 1231:
The issue of perpetual bonds in the Canadian market represented a new departure in dominion financing. It was intended as the initial step in a program which is designed to provide for the consolidation and simplification of our public debt structure.
All efforts of big business to prevent the encouragement of these Canadian consol issues should be strenuously resisted, for the minister will find that they mark the peak of security and acceptability, with low interest, ruling in our dominion. However, I desire to say that I do not agree with the minister when he says that he wishes to set up a general sinking fund for amortization. As a general principle I do not favour sinking funds.
If a security is not good at the end of its term, it is really not good at the beginning. Too frequently the investment of sinking funds is made in securities which have proved to be very insecure, such as many of the bonds of defaulting municipalities in British Columbia and elsewhere. The best security can admit of no better, and consols need no support from a sinking fund lying sleeping in a less secure resting place. Therefore, I suggest to the minister a policy of repurchase in the open market when the price of the bonds falls below a predetermined figure. This would be easy of accomplishment through the ordinary operations of the Bank of Canada and would establish the reliability of the investment for long term investors, and ensure its relative translatable utility when in the nature of things it must find its way to the market.


Charles Avery Dunning: I think the hon. member has mistaken the meaning of my remarks regarding a sinking fund. The object was not so much to enhance the value of the investment in the hands of the investors as it was to have a definite plan for the gradual reduction of our debt, somewhat along the lines the hon. member has indicated.


James Samuel Taylor: In any case I think the point is well taken. Another move in the right direction is the sealing down to Canada of a call and short term money market. Congratulations to the minister. The enlarged field of operations of the Central Bank of Canada should very early show its worth in this aim and bring the whole financial situation of the country into more favourable acceptance throughout the world.
And so I pass along to the pleasure with which the minister reviews the rising credits abroad. This in moderation is an excellent sign but taken in excess, like salt it nauseates and poisons, and at this period of our country's growth we do well not to encourage foreign credits to the point where we are compelled to invest abroad. The days when such a condition was a compelling advantage are gone. We live to-day in a world where even a negro in central Africa can become an expert aeroplane mechanic, and the successful exploitation of any country is particularly well attended to by its own nationals.
I will finish on one note prompted by the rising note of cheer and challenge with which the minister closed his speech. Let us truly see to it, as he said, that we qualify as a people in continued endeavour, individual, corporate and national integrity, to a keener sense of trusteeship in carrying out our every day business and civic responsibilities; but,

The Budget-Speaker's Ruling
here I say, let us not lose sight of the fact that in doing all these things our paramount duty is to do them first in Canada, first for Canada, and first by and with the amazing resources of Canada and the no less amazing resourcesfulness of the Canadian people.
And so, Mr. Speaker, I end, having both praised and blamed. I do not want the minister to feel like that excellent old character, Dick Fennell, in Pinero's Sweet Lavender, when he said, "Blame, blame, blame-oh yes; but praise-oh dear no." I want the minister to feel that there are many things in his budget which we have good reason to accept and be satisfied with, but the eternal concession to the orthodox in economic situations worries me so that I cannot understand why it is that he so slavishly follows it. However, taking it all by and large, I shall have very much pleasure in voting for the motion.


Mr. MARSHALL:: Mr. Speaker-


Walter Edward Foster: Before the hon. member proceeds with his speech I should like to draw the attention of the members of the house to the point, of order which was raised by the hon. member for St. Lawrence-St. George (Mr. Cahan) before six o'clock with reference to a statement mad'd by the hon. member for Three Rivers (Mr. Gariepy) in the course of his speech. The hon. member for St. Lawrence-St. George said this:
Mr. Speaker, on a point of order; I would ask for your ruling whether it is open to members of the house at this time to discuss a subject now under investigation by a royal commission with respect to which no report has as yet been received or laid before the house.
I should like to ask whether any hon. member wishes to speak to the point of order? Then I will proceed to render my decision.
I refer to standing order No. 41. We find under this standing order that paragraph 293 states as follows:
Besides the prohibitions contained in this standing order, it has been sanctioned by usage both in England and in Canada, that a member, while speaking, must not:	,
(m) discuss messages or reports which are not regularly before the house.
And reference is made to Bourinot, at pages 358 and 474, and to May, at page 292.
By reference also to the order in council which was adopted in the year 1936, a copy of which will be found at page 84 of Hansard, February 11, 1936, it appears that the commission known as the Turgeon commission was appointed under chapter 99 of the revised statutes of Canada, 1927, and in the last part of the order in council it is stated:
The minister further recommends that the commissioner be instructed to make his report as speedily as possible.
[Mr. J. S. Taylor.J
As no report appears as yet to have been made by the commissioner the house cannot very well discuss the matter now. I think therefore, that the point of order raised by the hon. member for St. Lawrence-St. George was well taken, and that it was not competent for the hon. member for Three Rivers to proceed to discuss the matter.


James Alexander Marshall: Budgets may come and budgets may go, but the problems of the returned soldier, of railways, of interest and debt, and of unemployment seemingly go on for ever. It is an old Canadian custom when hon. members are speaking to the budget, to extend to the Minister of Finance (Mr. Dunning) congratulations upon his presentation. This, with certain reservations, I do. I believe that we should reserve most of our congratulations for the taxpayers of this country who have striven valiantly through the medium of taxation to assist the Minister of Finance to balance his budget this year. They have taken upon themselves increased burdens, and they have done it with a smile. I say to the minister and to the party in office that no budget can be balanced unless the taxpayer takes out of his pockets the wherewithal to balance it.


Charles Avery Dunning: That goes without saying.


James Alexander Marshall: What long-suffering
patient mortals the taxpayers are! They are patient almost to a fault. It is necessary that they give the shirts off their backs almost to uphold the sanctity of interest contracts. The interest burden now resting upon the Canadian people is one under which they are going to crack one of these days, and the responsibility for such a situation will fall upon us in this parliament. I fear the time is not far distant when we shall have a revolution on our hands. Of course, we shall blame it upon the communists and the fascists, but we shall not be right in so doing. That revolution is coming, just as surely as night follows day, unless we awaken to our responsibility. Apparently we are not yet awake; I hope we shall awaken before it is too late.
I was interested in a statement which the minister made some little time ago when the bill covering home improvement loans was up for discussion. He stated at page 750 of Hansard:
I am just coming to the joker. The main reason why people who have $500, and who could get a home of that kind of which they would be proud, are not going into the scheme, is not because of any interest factor . . . but because the local taxes are what they are, and again I say that is within provincial and municipal jurisdiction.

The Budget-Mr. Marshall
I ask the minister: Are the municipalities and provinces alone in this matter of high taxation? I suggest to him that the reason for the high taxation is that a large portion of our tax dollar goes to pay interest. You cannot divorce taxation from interest or interest from taxation, no matter how you try. At least 25 cents of every dollar that the minister raises under the terms of his present budget go to pay interest charges. It was said the other day that over 40 cents goes to this one item, so I think I am safe in saying 25 cents. Interest is indeed an important and alarming factor in our whole business life to-day. It faces us at every step from the cradle to the grave. It has assumed such large and serious proportions that even governments all over the world, whether municipal, provincial or national, recognize that before we can hope to cope with any national problem we must tackle interest.
* May I now give a few moments to the question of unemployment. I realize, of course, that the amendment covered this point; but we cannot discuss the railway problem, or the problems of the returned soldiers or any other problem without bringing in the problem of unemployment and poverty, so closely are they connected. It is not only a national problem; it is international in its scope. It is not a disease, but a symptom of a disease.


Ernest Lapointe: I do not wish to interrupt my hon. friend, but this house has discussed unemployment on an amendment which has been disposed of, and I do not think he has the right to discuss it now.


James Alexander Marshall: I submit, Mr. Speaker, that the question is embodied in the budget, and for that reason I think I have a right to continue to discuss unemployment. It is closely allied to all these other problems, and I wish to show the connecting link between it and some of the other problems we have been discussing to-day.


Ernest Lapointe: The rules of the house say otherwise.


James Alexander Marshall: As one hon. member said a few days ago, unemployment is a sign of progress.


Walter Edward Foster: The point of order raised by the Minister of Justice (Mr. Lapointe) is well taken. The question of unemployment was discussed on an amendment which has been submitted to the house and disposed of, and the hon. member is not in order now in discussing it.


Mr. MacINNIS:: On the point of order, Mr. Speaker, I submit that any subject matter of the budget is a matter of debate on this motion. The Minister of Finance dealt with the question of unemployment in his budget speech.


Mr. YIEN:: The ruling of the chair has been given; it is not now in order to speak to a point of order.


Richard Bedford Bennett: The point taken by the Minister of Justice (Mr. Lapointe) would undoubtedly be sound if this were other than the budget; but though the motion with respect to the attitude of the government towards employment has been negatived there still remains the right of a member of the house to allude, by way of illustration or analogy, to conditions respecting unemployment, though he cannot make that the subject matter of his address. I fancy that is what the minister meant when he pointed to the rule of the house. It would be a serious curtailment of the right of speakers if it were to be said that the use of illustrations or analogies in reference to the problem of unemployment was not available to them.


Ernest Lapointe: My right hon. friend was not listening to the hon. member. The hon. gentleman did not say that he was referring to unemployment or drawing an inference; he said that he was going to speak on the subject.


Richard Bedford Bennett: What the minister said with respect to that is undoubtedly true, but I thought that the hon. member said in effect: I now propose to deal with unemployment, not as the subject matter of my speech, but for the purpose of showing it to be one cause of the many evils from which the country is suffering. I did not understand that he was making unemployment the subject matter of his address but rather that he was touching upon it by way of analogy or illustration. I would not venture to discuss the matter, but I do think that to narrow the debate by precluding such references to the question of unemployment would be going farther than the rules have thus far gone. I wholly agree, however, that the amendment having been disposed of, the right of a member is restricted with respect to the question of unemployment, so that he cannot make it the subject matter of his address. I thought that the hon. gentleman was making the question merely incidental to the discussion of an evil which he was suggesting should be remedied.

The Budget-Point oj Order


James Alexander Marshall: If I have your permission to proceed, Mr. Speaker, unemployment, as one speaker said a few days ago, is a sign of progress, and that means that man is rapidly escaping from the era of slavery and bondage into one of leisure, brought about to a large degree by the mechanization of industry. I know that many do not agree with the Social Credit party in that regard, and that is why it is difficult for us to solve some of these other problems that arise out of it. I am indeed disappointed that the National Employment Commission has done so little. Some members try to insult our intelligence by saying that it has done a great deal, but I, for one, cannot accept this conclusion. It has done nothing, and so far as I can see it will do very little in the future. Someone from the depths of his wisdom has said that you get what you pay for, meaning, of course, that a good article will command a better price than a poor one. I think there is a lot of truth in that statement. The chairman of the National Employment Commission is Mr. Purvis. For his work as chairman of that commission he receives nothing, according to the returns which have been brought down. Up to the present we have had practically nothing from that commission. We have got what we paid for. Of course, I realize that the expenses of the commission have totalled somewhere in the neighbourhood of !SS5,000-


Ernest Lapointe: Mr. Speaker, I think this point must be decided. I claim that the amendment on the subject of unemployment having been discussed and voted down, the hon. member has no right now to discuss unemployment as the main subject of his address. I refer to paragraph 491 of Beauchesne, dealing with the situation where an amendment has been negatived on the motion to go into committee of supply or ways and means:
If that amendment is negatived, a discussion on other questions may be raised but no other motion can be proposed.
"A discussion on other questions." Surely my hon. friend cannot discuss the amendment again after it has been disposed of.


Mr. FAIR:: When the amendment to this motion was being discussed we had a wide open debate, and the deputy speaker at that time ruled in favour of a wide open debate. We discussed almost everything and anything we wanted to on that amendment, and I do not see any reason why we should not be allowed to discuss unemployment on the budget. This is just one more way of putting this question under the table.


Some hon. MEMBERS:: Order.


Ernest Lapointe: That also is absolutely out of order, and unfair.


Mr. STEVENS:: There is nothing out of order there. You cannot put a gag on everybody in the house.


Richard Bedford Bennett: I think we agree that with respect to discussions on the budget the rules are framed so as to give the widest possible latitude. The general rule that when an amendment has been negatived the discussion shall not centre about it is a perfectly sound one, because otherwise there would be no termination to discussion at all. On the other hand during the progress of the discussion on the amendment, much of the debate was not referable to that point at all, and the deputy speaker indicated that in his judgment the budget debate had generally been regarded as the opportunity, shall I say, for hon. members to indicate their reasons for believing that all was not well in the state, and that the government had not done all that might be done. That I think is putting it correctly.
I wholly agree with the minister that a speech on unemployment at this time would not be within the rules, but surely freedom of speech in this house is so important that any hon. member who desires to do so may amplify and illustrate his point, and by analogy press it on the attention of the house in any way he pleases. The hon. member, I think, started out with the statement that he was dissatisfied with conditions, and he said: If you examine all these conditions you will find that ultimately they are traceable to a cause. And he gave that cause as unemployment. Now if he continued to discuss unemployment only, I would wholly agree with the minister, but when he is discussing the whole situation and mentions unemployment only for the purpose of indicating a failure on the part of the government to grapple successfully with other problems because this is the root problem, I am inclined to think that freedom of speech must permit of that being done. I say it with deference to the Speaker, but if we are going to apply a rule of order narrowly it should have been done some days ago.


Ernest Lapointe: This
afternoon.


Richard Bedford Bennett: Quite so. On the other hand, to narrow it too much would destroy the whole purpose of the budget debate, namely, the right of the subject, through his member, to make known his grievances to the throne; that is to the government in this case. I am inclined to think that on recon-

The Budget-Speaker's Ruling
sideration the minister will agree that so long as a member is dealing with the whole subject matter he may amplify and illustrate his remarks in any manner he thinks desirable.


Ernest Lapointe: As far as freedom of speech is concerned, I do not think I am one who could ever be accused of desiring to curtail it, and I very seldom raise a point of order, even though at times there might be occasion to do so. In this matter my right hon. friend is perfectly right in saying -that if the hon. member was simply alluding to unemployment and drawing some analogy nobody would think of raising a point of order against him. I also agree that in the budget debate one may refer to almost anything and everything. But when there has been an amendment on a special subject, moved to the motion, and full discussion has taken place on that special subject, and the amendment has then been disposed of, no hon. member has -the right to revive entirely the debate on the amendment and make a new speech on it. That is the whole point.


Angus MacInnis: With all due deference to the Minister of Justice (Mr. Lapointe) I do not think he read the rule applicable in this case. He should have read paragraph 490 instead of 491. Paragraph 490 reads:
When an amendment for the Speaker's leaving the chair has been negatived, as it has been decided that the words proposed to be left out shall stand part of the question no further amendment can be moved thereto; though general debate on the main question can be maintained by those members who have not exhausted their right to speak to that question.
This does not rule out a general debate on the subject matter of the budget. I maintain that the hon. member is quite in order in making his remarks on unemployment part of his general comment on the budget.


Alan Webster Neill: With a view to promoting harmony and letting us get on, I suggest that the hon. member for C-amrose (Mr. Marshall), might exercise a little diplomacy and save the situation. I recall in years gone by the hon. member for one of the Battlefo-rds had a resolution on t'he order paper in connection with a Canadian flag, and the hon. member for Huron North, I think at that time Mr. Spotton, insisted on making a stump speech on the tariff, on the motion. A point of order was naturally taken, and the Speaker ruled that he would have to keep his speech strictly in line with the resolution concerning the flag. The hon. member went on making his stump speech on the tariff, and whenever he saw the Speaker or some member rising
to protest he hurriedly said, "All in connection with the flag, Mr. Speaker," and that saved the situation. He made a regular stump speech on the tariff under that resolution. Of course, he carried it to an absurd and unreasonable extent, but he got away with it. So if the hon. member for Cam-rose would modify his statement by occasionally interjecting -that he is dealing with unemployment only in a general way, he would probably save a lot of the time of the house.


Mr. HARTIGAN:: I think an hon. member is perfectly entitled to discuss any item in a budget debate, even though he has spoken on an amendment to the motion which probably covered a vast range of subjects. All last week in the budget debate there was scacely any item that could be debated that was not debated. I take it that the member who was speaking was discussing unemployment from the point of view of departmental expenditures, and any member of this house is perfectly at liberty to discuss that matter. Right is right and wrong is wrong. I think if we put too many inhibitions and restrictions on the members of this house we will have good cause to worry as to what is to become of our parliamentary institutions.


Mr. QUELCH:: I should like to point out, Mr. Speaker, that the hon. member for Cam-rose (Mr. Marshall) had desired to speak on the amendment, but in order to expedite matters he agreed to wait until the main motion was called. He refrained from speaking previously in order to assist the house in getting on with its business.


Walter Edward Foster: I must say that the point raised by the hon. member for Quebec East (Mr. Lapointe) is well taken. There is merit also in the point raised by the right hon. leader of the opposition (Mr. Bennett), and perhaps even more in the suggestion of the hon. member for Comox-Alberni (Mr. Neill). I think perhaps the latter suggestion is about the best, and now that the hon. member for Camrose (Mr. Marshall) has commenced to make a speech on the budget perhaps he would try as best he can. not to speak about unemployment.


James Alexander Marshall: I wish to thank you, Mr. Speaker, for your very kindly suggestion. I do not wish to transgress any rules either of propriety or of this house; I simply want to make a few general remarks, and I wonder if I would be in order if I used the word "employment" instead of "unemploy-
COMMON?
The Budget-Mr. Marshall
ment." It just happened that I was coming to something that really would touch upon the point that has been under discussion.
In his speech the other day one member of the Liberal party pleaded eloquently for cooperation. I should like to ask that hon. gentleman what kind of cooperation he would like to have from the Social Credit party. From time to time we have made suggestions, some of which have been met with ribald laughter, and others with scorn and derision. In my opinion such conduct will not promote cooperation. To-day the Liberal party holds the reins of office in most of the provinces of the dominion, and they have 170 seats out of a total of 245 in this house. They have control of the central bank, and by this time they should have had control of currency and credit. The government have had at their beck and call innumerable commissions, yet they plead for cooperation from a few of us on this side of the house. It seems to me that instead of crying out for cooperation they should get on with the job entrusted to them-the solution of the employment problem. We are most anxious to assist, but I am afraid the cry for cooperation is nothing more than idle talk.
I have a suggestion to offer to the Liberal party to-night. I suppose it will be relegated like many others to the waste paper basket, but still I am going to make it. Last Sunday I was privileged to listen to a broadcast entitled " What Is Behind the News "?- sponsored, I think, by the life underwriters' association. In discussing some of the matters relevant to the situation prevailing at present the speaker was very definite in some of his conclusions. I have listened to him on many occasions, and apparently he has an excellent grasp of some of our problems. As he concluded his talk I wondered if it would not be possible for us to get that gentleman to give us the benefit of his knowledge. Then I thought of another individual who a short time ago went out to the province of Alberta, stayed a week or so, then came back and became an expert on conditions out there. This gentleman held the chair of economics at one of our leading universities, but lately he has been able to do a little better by writing humorous stories. Sometimes I wonder if he does not think that his teaching of economics is a joke. But could we not get hold of him and have him help us deal with this problem? Then I thought of a lady who has been writing very excellent articles in the Financial Post,

and who now holds a position in the employment commission, and I wondered why we could not get her to help us solve our problems.
It occurs to me, Mr. Speaker, that we should be able to form a commission to end all commissions, and I would suggest that this commission consist of the leading business men of the country. Why not try to solve these business problems in a businesslike way by the use of business methods? Why not form a committee consisting of economists like the governor of the Bank of Canada, the president of the Bank of Montreal, the president of the Royal Bank, two or three representatives of the mortgage companies and three or four representatives of business, and entrust to that committee the problem of unemployment? You can go on appointing commissions from now to doomsday without result, unless you provide penalties for their failure to carry through what may be given them to do. Why can we not run our government as a man runs his business, in a businesslike way? I venture to suggest that if we actually commanded these people to come to Ottawa and form a committee, and made them responsible and attached penalties for any failure to find a solution of this problem, we would solve it-and it seems to me that is the only way we will ever solve it.
I am talking from the standpoint of orthodox economics, not from the standpoint of the new economics. I would solve it in a different way if I were speaking on the problem from the standpoint of the new economics. I venture to say that if we adopted such a suggestion as I made we would solve the problem in a very short space of time. It would be the representatives of business against the forces of poverty and everything else that goes to degrade civilization. If those men and women did not solve the problem, they would admit they were unable to solve it, and would stand condemned in the eyes of all the people of Canada. In my opinion that is the way the problem can be tackled and solved.
Let me make a few observations on the railway problem. I ask the government this question: Why have almost two sessions been permitted to pass without tackling the railway problem? Are we afraid of it? If so, of what are we afraid? Is it not time that we did something about the problem? I say that if we appoint a committee of business men charged with the responsibility of solving this problem, with penalties attached, they will solve it.

The Budget-Mr. Turner
I was interested in a statement made last year by the hon. member for New Westminster (Mr. Reid). I want hon. members of the Liberal party to listen carefully, because I really believe he touched the core of the problem. The hon. member is reported as follows, at page 3377 of Hansard for 1936:
Every member of parliament is aware of the heavy load which the country is carrying and the heavy interest charges which have to be met each year on the Canadian National railways, and in all our deliberations with a view to finding a solution of the problem, no one seems to have put his finger on the one spot which, if properly taken care of, might lead to a betterment of conditions and the bringing of our railways up to date. I speak of the labour element. Every attempt that has been made by either of the railways to amalgamate services has brought numerous telegrams and representations from every labour organization in the country, and rightly so, because they fear, the dismissal of the rail\vayiiieu. If more serious note were taken of this labour aspect of the question, and an investigation made into it as was done in the United States, where there is provision in all their railway mergers for compensating by way of pension the employees dismissed, if we similarly made provision or set up a commission to take care of the men dismissed-
There is the point.
If we . . . set up a commission to take care of the men dismissed in any amalgamation or merger of the railways, I believe we might find a solution of this great railway problem. But that aspect of the situation has never been touched. It is true the financial aspect looms largest in the minds of most hon. members. Nevertheless, every time we approach this problem we are met with the question: What shall we do with the men who are dismissed? I am strongly of the opinion that if we set up a commission to look into the possibility of taking care of the men so displaced, we might bring about a solution of our railway situation. I know that this question has been gone into in the United States and some such plan is afoot there.
Is not that the reason why we are afraid to tackle the railway problem at the present time? The suggestion I made in connection with the employment situation I make again in connection with the railways-that we appoint a commission charged with solving the problem, a commission not of those attached to any political party but rather one composed of business men, and attach penalties for their failure to solve the problem. Do that and we will get somewhere. If the appointed head of a business concern is not successful, he is removed without hesitation. But to-day when we appoint a commission they go on and on indefinitely, without any solution.
In closing may I say that these questions are of paramount importance to the people of Canada. They are not being solved. To use
an ordinary, common term the Liberal party to-day is passing the buck, and in the very near future will have to answer for its actions.
I hope and sincerely trust they will do something before it is too late.
From day to day I have heard nothing but talk about high and low tariffs. May I leave a thought with those hon. members who still consider that tariffs are the important factor in the solution of our problems? I would refer them to a sentence written by Abraham Lincoln, who said " I know very little about the tariffs, but this I do know, that if we buy rails from Europe, then Europe has our money; but if we buy rails in the United States, then we have the rails and we have the money, too." That is a fact I should like some hon. members to ponder over carefully. I earnestly beseech the Liberal party to get busy and solve these very important problems now confronting us.


Mr. J. M. TURNER (Springfield):: Mr. Speaker, I rise for the first time in this house, and wish at the outset to congratulate the Minister of Finance (Mr. Dunning) on his able and early presentation of the budget. I have been told and believe that old wines improve with age. I understand that in that respect they are similar to the budgets brought down each year, because they too improve with age; each year they become better.
The constituency I have the honour to represent is one of the largest in Canada, and covers almost all of eastern Manitoba. At the north end of the constituency of Springfield is the central Manitoba mining area, a great gold producer. South of that are the large paper mills situated at Pine Falls. The company at that point has this year contracted to' take out nearly 100,000 cords of pulpwood from the surrounding dis- * trict, an enterprise which will be helpful to the farmers and settlers.
Continuing in a southerly direction we find five of the largest power plants in the province, all situated on the Winnipeg river, and supplying all the electric power for greater Winnipeg and other points in Manitoba. Continuing farther we come to the five municipalities of Lac du Bonnet, Whitemouth, Broken-head, Springfield and St. Clements, where a total crop failure has never been known. This area is noted for mixed farming, truck farming, and for its numerous beaches and tourist parks. Next we come to Beausejour, the largest town in my constituency, and the county seat, situated on the trans-Canada highway, where the farmers hold a semimonthly market. Here every two weeks one may see from 1,000 to 2,000 farmers trading and selling their produce.
The Budget-Mr. Turner

Next we come to the towns of Garson and Tyndall, where the famous Tyndall stone quarries are situated. This stone needs no introduction here, for the interior of this beautiful building is built of it. Just in passing, I may say that it makes very good tombstones, but I am not soliciting any orders at the moment. Lastly, we have East Kildonan, a suburb of Winnipeg. This is usually a great labour centre, but at the present time there are many unemployed in that municipality.
What we need to help solve the unemployment problem in Springfield is more mining roads and a greater development of our mining areas. I want to take this opportunity of thanking the Minister of Mines and Resources (Mr. Crerar) for the help he gave to this district last year. We need better rural roads to help our farmers and to increase the very important tourist trade. We need industries, such as sugar beet factories, to absorb our surplus man power as well as our surplus electrical power. I might mention that the provincial government of Manitoba has gone on record as being willing to guarantee the bonds of a sugar beet company to the extent of $600,000. We need the extension of our power lines to all important points in Springfield, for the two reasons I have just mentioned. We *want the federal government to specify Tyndall stone for all future buildings. This should be done on account of its well known qualities.


Mr. L. A. MUTCH (Winnipeg South):: Mr. Speaker, when I first decided to take part in this debate I had thought perhaps that I would be speaking shortly after the amendment, and I had intended to draw attention then to some of the things at which I was much surprised during the debate on the amendment. A stranger dropping into the gallery at that time might well have asked, " Where and when is the election "? Now that that thunder no longer shakes the edifice of government, perhaps a whisper from within may be heard for a few moments.
It is perhaps presumption on the part of one so new in politics to compliment the Minister of Finance (Mr. Dunning) upon the splendid budget he has presented, but I do want to take this opportunity of saying that in spite of the fact that the paeans of praise that went across the country have died down, there is still in the hearts of most of the people, not only in my constituency but throughout Canada, appreciation for a job well done.
I do not propose to recount again the virtues of this government. All that they have done-and much has been accomplished

-is only what the people of Canada expected of them. It is not, then, of things they have done that I would speak at this time. In the few minutes allotted to me I would speak of the fights not fought, and of the campaigns as yet uncharted. Last summer I had the opportunity of travelling from Montreal to British Columbia. I made that journey in a leisurely way; I walked and talked with many of those who sent us here, and I brought back with me a picture which I would like to give to the house to-night. It is a picture which I hope we might all carry clearly in our minds during our deliberations.
The endless struggle to keep on an even keel while the world around us is reeling is taking its toll of our people. Young men are greying at thirty-five years of age or younger, and perhaps I am ungallant in mentioning that their women folk for the first time in two decades are showing their age. Even the great war failed to place its impress so clearly upon the faces of our people as has this depression. It has been said that anxiety is the architect of new lines on the faces of humanity. Anxiety and fear and want ride with us in these days and it is our task to find relief from their soul-destroying blight. War terrifies; but it also exalts. I would not. minimize the anxious horror of those who sent their dear ones into battle, but there was a veil of glamour about it which relieved even the starkest tragedy. For the combatant there is always the thrill of uncertainty and the chance af a sudden end. Add to that the exuberance }f perfect physical condition, and the singing soldier is no mystery.
But in the grim, relentless and' unrelieved struggle of depression there are no non-combatants, or at best very few. No glamour veils, even thinly, the raw stuff of failure, misery, want and hopelessness. No cheering muffles the sobs of women or the cries of children. No poet sings the praises of the worker who wages a losing fight with poverty. His failing hand holds no torch to fling to those he leaves behind. For him no cenotaph is raised. He will be known, if he is remembered at all, as a futile thing-a man who failed. Not daring, these men, with nothing to dare, are simply hopeless, struggling creatures just plodding along, their only motive spark the dim embers of their former enthusiasm for life.
Dare we in our deliberations put from our minds for an instant the real problem of these our fellow Canadians? No one realizes better than I do that appeals to fellow Canadians have been traded upon in this house, and yet I can frame no better phrase to describe them. We are most of us of a generation under whose

The Budget-Mr. Mutch
leadership the fruits of folly matured, a generation which, cannot even yet realize that the depression is the result of a combination, if you like, of those mistaken policies inherited and nurtured1

a generation which still believes that the depression settled upon us unheraldted, like the visitation of locusts in the Egypt of biblical times.
Having failed to see and heed the warning signs, having been content just to wait and wait, serene in the belief that the storm would pass, people now at last fearful of a condition which they yet fail to comprehend turn like fear-stricken sheep to mass objectives and try to find in various "isms" collective courage and collective authority for change. They seek in collectivism the means to stem the tide of the affairs of men. I am persuaded that most of the "isms" of the world are bunk. They miss the vital truth that the actors in this world drama are men and women. We can never really face up to the problems of society until we learn to think and speak and calculate in terms of men and women. The weakness of every "ism"- I exclude Liberalism-is that it puts emphasis on the system and its machinery, and disregards the human factor. We must ask and answer this question: Are we men or are we puppets? If w.e are men, then it is we who matter and not the system.
We have sought too long a magic formula by the application of which we hope to restore society to the good old days that never existed. The world has given position and, power to men who promised, not a fuller life but a life which in retrospect seems all good. It gives ear to such men now. When will we learn to turn to ourselves, to forsake false counsel, to know what it is that we seek, and to seek it in the one place where it is to be found

in ourselves?
To the government front benchers I would say this: The opportunity for leadership is in this house. The qualities of leadership are not lacking. The courage of leadership will give to the men who exercise it opportunity and reward unparalleled in history. Moses the lawgiver has been remembered in brass and stone, but Moses the man who led his people out of captivity is enshrined as a living model in the heart of every man who would be free.
And now, Mr. Speaker, to be more specific -now that we are resolved to examine ourselves, first, in relation to our problems- where shall we begin? It seems to me that one great problem overshadows all others, and sir, I hasten to say it is not the problem of a balanced budget, although it is related to that. To me there is no problem
of a balanced budget. The determination of the hon. gentleman who presides over the treasury will balance the budget. There is no doubt of that, but at what cost remains to be seen. But we shall see, and the people will judge, and I for one, am hopeful that the result will not be a worse horror than an unbalanced budget. Most of the people by whose grace I am here have unbalanced personal budgets, and most of them are worried about it. But there is a great and ever-growing number of people who feel the hopelessness of their situation and, realizing that they cannot cope with the arithmetic of their misfortune, are entirely indifferent to the arithmetic of the Minister of Finance. But let that pass. The greatest problem is the problem of the economic emancipation of the individual. As always, misfortune begins at the bottom, and restoration begins at the top.
There are those who view this situation and cry out that socialism is the answer, that we should begin restoration by levelling down the top to the standard of the lower strata. I have said that to me the collectivism of socialism is nonsense. To many, debt adjustment seems to be the answer. Obviously a measure of debt adjustment was and still is essential to a program of recovery. But to me it is a means, not an end. It is much easier for me to go along with the Minister of Finance when he states that the real and abiding recovery comes from an increase in the national income. The government has realized in this matter that the critical thing is the problem of the reality of recovery. The immediate need can be, has to be, and will be, met.
We in Canada have been much concerned with the problem of keeping the farmer producers on the land. The Farmers' Creditors Arrangement Act was drafted and is being administered to that end. While the act is far from perfect in its application, it has served, despite abuses, to effect some real relief.
So far no government has recognized by any action the plight of that great taxpaying body, our urban and suburban home owner. No other section of the Canadian public bears anything remotely approaching the tax burden borne by these people. They pay the biggest percentage of the property tax; they contribute generously to the income tax; in almost every centre in Canada t'heir school taxes are extremely high. As salaried men and wage earners they were the first to absorb the shock of the depression; as such they are likely to be the last to gain by any improvement. They are for the most part unorganized
The Budget-Mr. Evans

for their own defence; indeed they cannot hope to be otherwise. We have, on the one hand, capital, comparatively small in numbers, organized, compact, served efficiently by the ablest of advisers; on the other hand, organized labour, with a tradition of unity, the machinery of cooperation, and compact units based on mutual interest and mutual objectives. Contrast with this the great mass of urban and suburban workers in professional and clerical occupations; add to them the men and women on the farms, on small holdings, and in the villages. They are not, nor can they ever be a compact unit, socially or economically. If we in this house do not raise our voices in their behalf, they are voiceless, and it is our duty to see that these people, the same people who sent so many of us here, are not forgotten while the battle cages between those who would strengthen the present social order and those who would tear it down.


Mr. C. R. EVANS (Maple Creek):: As one of the new members from western Canada, and having listened to the debate on both the amendment and the budget, I shall try for the few minutes of time that I occupy to keep as nearly as possible within the rules of the house.
First I congratulate the Minister of Finance (Mr. Dunning) upon his presentation of the budget and his comprehensive survey of Canada's improved condition in world trade and in our economic and financial relations. While all these improvements may not be due to government policies, in a large measure they are so. The government has taken the lead in promoting world trade. Shortly after it assumed office in 1935 the Canada-United States trade agreement was consummated, and from that time on our government has extended the hand of friendship to all the nations of the world and has been successful in promoting and increasing empire and international trade. It has come to be widely recognized that the Ottawa trade agreement of 1932 was not sufficiently favourable to Great Britain, and that the lowering of certain duties might tend to expand trade currents not only in one direction but in both. The general effect of the new trade agreement should be to render more effective the policy of this government-to canalize more trade in inter-imperial channels.
The constituency which I have the honour to represent is entirely rural. Being primary producers we are naturally free traders. Therefore tariff policies mean dollars and cents to us. We are pleased with the reductions of

tariff put into effect by the present government, but look forward with the present tendency to freer trade to greater reductions in the future. Being primary producers we have to sell our products in open markets, while everything we purchase is bought in a highly protected market. That is a condition that cannot continue if farmers are to stay in business. Unless there is a levelling of the spread in prices of the articles we have to sell in relation to those we purchase, it will be difficult for the farmers of western Canada to carry on.
It is true that in the past six or seven years we have met with disastrous crop failures through drought and other causes beyond our control, but the fortitude and courage of our people through the period of drought and depression have been wonderful. Picture a farmer putting seed in the ground year after year, without ever reaping a harvest, while each year he sees his assets dwindle until he is finally forced to come to governments and other agencies for assistance, and then you may realize in a small measure the problems with which we in the drought area of the west are faced. It is encouraging to know that the federal government now recognizes the gravity of our problems and is taking steps under the Prairie Farm Rehabilitation Act to combat the ravages of drought and bring these vast areas back into production.
The Maple Creek constituency produces great numbers of cattle, sheep and horses. In the year 1936 we shipped out of this constituency 36,000 head of cattle of all classes. In passing, I would mention that the feeder policy of the government increased by about
10.000	head the shipments of feeder cattle out of our district. We also shipped around
22.000	sheep and lambs, and about 2,700 head of horses.
I desire to draw to the attention of the Minister of Agriculture (Mr. Gardiner) the importance of stimulating in some way the horse industry in the south west country. For the information of the house and the people of Canada generally. I would point out that the Maple Creek and Willow Bunch constituencies produce perhaps more horses than any other district in the dominion.
It is encouraging to note the increase in the exports of cattle in 1933 over 1935. The total exports to the United Kingdom in 1938 were approximately 39,000 head, as compared with about 7.000 head in 1935, while to the United States in 1936 we shipped approximately 225,000 head, as compared with about
106.000	in 1935. Exports for the twelve

The Budget-Mr. Hay hurst
months of 1936 showed the heaviest volume in many years, reaching a total of 264,000 head, as compared with 116,000 in 1935.
The other day, in the course of the debate, the hon. member for Lanark (Mr. Thompson) made references to the vast amount of new wealth which had been created in western Canada in the past fifty years, and he -went on to say that had it been properly handled that wealth would have been sufficient to tide the western provinces over any ordinary difficulty. At page 1453 of Hansard he is reported as follows:
Ontario and Quebec, where the great majority of these protected industries are located, pay seventy-five per cent of the taxes collected in Canada. I ask this house:	How long are
Ontario and Quebec going to remain a pair of placid milch cows to be stripped dry to pay the bills of provincial governments over whose expenditure they have no control? ... In all fairness I say it is high time that these western provinces were told quite frankly that they must put their own houses in order to balance their budgets and live within their means.
The hon. gentleman's criticism is in order, no doubt; but if he would consider what became of the great wealth that we made in western Canada during, say, the past thirty years, and consider where the feed came from that kept those cows, he would realize that if it had not been for the wealth we poured into the industrial centres of eastern Canada to the extent of millions of dollars each year through tariff duties, those placid cows he talks about would have been dry long ago.
It is true that we did produce a vast amount of wealth, and it is equally true that the provincial governments in the west find it difficult to-day to carry on, with the financial problems that face them. But there is a story behind the provincial problem in western Canada, and I should like to put it before the house for consideration. In 1905 our province was formed, and from 1905 to 1929 we had a Liberal government in power; and during all those years that Liberal government never once failed to balance its budget. At the end of 1929 the public debt of Saskatchewan was $66,000,000. What did we receive for that $66,000,000 of bonded debt? We got all the services which a new and growing province demands, such as parliament buildings, gaols, sanatoria, mental hospitals-and by the way we have built one at Weyburn-a system of highways, bridges, the university, three normal schools, court houses and many other services that are required to carry on the functions of government. In 1929 a change of government took place, and after five years of Conservative administration we found that our public debt
in Saskatchewan had increased to $154,000,000. True, $18,000,000 of this was spent for relief, but the rest has been spent extravagantly on commissions and many other unnecessary investigations. During their five years of office the Conservative government did not at any time balance its budget, and I would point out to the hon. member for Lanark particularly that that is the reason why the province of Saskatchewan to-day is in financial difficulties.
Last July I made a survey of the constituency I represent. I interviewed municipal and urban councils, school boards, live stock associations, farmers' organizations, and also held public meetings in order to get first hand information as to what our people thought would be the best means of giving to the needy assistance until such time as crop conditions improved. In every instance a works program was suggested whereby our people might be able to earn a living, instead of being demoralized by direct relief. Suggestions were made that the federal government cooperate with the provincial government in the construction of highways, the hard surfacing of main highways, the elimination of dangerous level crossings, increased activity in our water conservation program and improvements in our provincial and national parks.
This afternoon the hon. member for Rose-town-Biggar (Mr. Coldwell) referred to the stand which the federal members in western Canada took with regard to the action of the government last summer. I made one statement which I wish to confirm in this house to-night. At a meeting I attended, on invitation from many of my constituents, I said that I felt that the dominion government should have continued the operation of the wheat board during the crop year 1936-37, and I still think so; but I qualified my statement by saying that I was not in favour of governments being in business because that was the first step towards state socialism.
Let me say this in conclusion. The people of western Canada face the future with optimism and confidence, believing that nature will this year supply sufficient moisture once again to produce a bountiful harvest.


Mr. WILLIAM HAYHURST (Vegreville):: The keynote of the budget speech of the Minister of Finance (Mr. Dunning) was one of cheer and confidence, or cheer and challenge, I believe the actual words are. These two words evidently influenced the general tenor of his speech, the peroration of which was dramatic. No problem, he said, is insuperable.
1/10

The Budget-Mr. Hayhurst
Seeing that the minister is so optimistic, I should like to mention the subject of slum clearance. I suggest that the government should start in the near future an active campaign for slum clearance. Most of our cities must be subjected to some type of slum clearance, because there is much overcrowding, and the people in these districts have to put up with living conditions that should be abolished. In England Sir Hilton Young called these areas in the centre of the cities the bad old cores of the inner areas of our great towns. We find these bad old cores in the inner areas of all our cities in Canada. We feel, Mr. Speaker, that every family should have such housing as is essential for decent and healthy living. The whole country is sadly neglected in this respect. So a strong effort should be made by the dominion government to bring about slum clearance. This subject has been before the house in a resolution, and I mention it here merely to drive home to the government, if possible, the gravity of the situation. It cannot 'be too often reiterated. Bad housing conditions are the supreme social evil of our time, poisoning life from infancy, and undoing much of the good results which education and medical science would otherwise achieve. Thousands of our young people have no home in any real sense of the word, but dwell in these ill-constructed, vermin-infested, insanitary old houses, in foully overcrowded districts. If this malignant growth is not excised it will drag us down as a nation in body, mind and soul. Slum clearance, of course, involves planned development, and team play amongst owners, architects and the government: but planned housing in some form must come if the bad conditions brought about by present happy-go-lucky methods are to cease.
I have listened with a great deal of interest to the discussions in this house and in this debate on the budget, of the problems which face western Canada. I noticed that sometimes the wheat problem was discussed when we were speaking of unemployment. The wheat problem of the past few years, the wheat problem of the future, and the present problems of the farmers are vitally important. I was very much interested in the remark of the previous speaker that western Canada had produced such enormous quantities of wealth in the last few years. To-day and yesterday something was interjected into the debate regarding the wheat marketing schemes of the present government and the preceding government. I have in my hand a pamphlet published in Calgary in February 1936. by the former chairman of

the wheat board, Mr. John I. McFarland. That is over a year ago. Sometimes we hear it said that the wheat marketing situation had not been thoroughly- discussed prior to the present government taking office. I should like to read a short paragraph from this pamphlet, to illustrate what the previous speaker has mentioned about the great amount of real wealth which western Canada has produced in recent years, and in relation also to the marketing of this our greatest primary product. Mr. McFarland said:
In the years before the depression our public men were proud to describe Canada as the "bread basket of the empire." From November, 1930, until 1931, the whole world had become a bread basket, but, despite that obstacle, Canada supplied more bread in the past five years to the great consuming centre of this empire than we did prior to 1930. From 1930 until 1935 inclusive, this dominion produced over two billion bushels of wheat. The farmers have marketed their surplus from these crops and have received prices which have been denounced as higher, and much higher, than so-ealled "world prices." Broomha-lil and others have recently made the statement that our carry-over next fall will be down to normal or near normal. Why? Simply because Canada is now the only country from which import countries of Europe can secure supplies except for a moderate quantity from Australia.
When Mr. McFarland wrote this pamphlet the Argentine had suffered from drought and its crop was already harvested, or at least most of it. They knew at any rate the amount of wheat available in that country. He goes on:
The scene has now so changed that until another crop is harvested Canada is, in large measure, the "bread basket" not only of the empire but of the world. In the face of these facts the Winnipeg Free Press maliciously refers to me as the man who says, "Don't Sell Wheat." I ask you, is that fair play?
This prediction by Mr. McFarland in February 1936 came to pass. The world to-day is facing more or less of a shortage of wheat, owing to successive bad harvests in various countries. I did not bring with me to-night a copy of the Manchester Guardian which I had, containing an article written just about that time. The article said that the British crops in February last year were very badly damaged, as were the French and German crops-that is the winter crops-through too much precipitation. This would suggest that the main areas of Europe which need large importations of wheat were then realizing that their crop conditions were bad and that they would probably harvest a smaller crop than usual.

It is not only western members who should be interested in the wheat situation. Practically every farmer realizes that some just price-and when I say just price I mean a price which will give to the farmer the cost of production-must be accorded to the farmer not only for wheat but for dairy products and cattle, hogs and other products. The trouble is that for all the goods which the farmer has to sell he must accept the price offered by the buyer, but for everything he purchases he must pay a stipulated price which is based upon factory cost, plus the profits of wholesalers and retailers. It is evident that during periods of depression farmers' prices are below the cost of production; therefore a just price must be established for farmers' products which will give them at least the cost of production. The great majority of farmers in this country are most eager to obtain the economic equivalent of what the tariff gives to industry. That means that the farmers not only of eastern Canada but western Canada should have the prices of their goods to some extent stabilized, because the prices of factory products are stabilized through tariffs and through selling organizations. Farmers in western Canada are severely handicapped by reason of the fact that machinery costs them so much more because of the tariff. The investigations that are proceeding at the present time would seem to indicate that the tariff is not the only factor, and that selling organizations and factories seem able to put up prices to their own satisfaction.
When the hon. member for Selkirk (Mr. Thorson) was speaking the other day he quoted figures regarding Switzerland and other European countries in an endeavour to show that the Bennett administration had lost our European markets. Of course, the hon. member was not really analysing the entire European situation. He knows, as all hon. members know, that a period of economic nationalism, brought about by fear, affected the entire import and export trade of every European country. At one of the conferences held by the international wheat committee a delegate from Switzerland remarked that wheat in that country was grown at altitudes much higher than was the case in other countries, and in very poor soil. Naturally the wheat was of very poor quality. But the Swiss government subsidized the growing of this wheat, just as the French government and the governments of other European countries subsidized their home products. In regard to the 31111-108
The Budget-Mr. Hayhurst
subsidy on Swiss wheat a British expert composed the following verse to illustrate the conditions that existed in most European countries:
Red is the wheat, denatured,
On which the fowl is fed;
Red the impending ruin About the farmer's head.
Red glow Helvetia's harvests Amid the glaciers cold Where every frozen wheat ear Has cost its weight in gold.
In 1934 even South Africa produced a surplus of wheat amounting to about 860,000 bags. In other words, the nations of the world, whether belonging to the British Empire or in Europe, were intent upon raising more of their own products and becoming as self-sufficient as possible. Because of the change in economic conditions and the determination of importing nations to become as self-sufficient as possible, flour milling standards were altered very radically; lower grade wheat was used, and other foods were substituted for bread. Prohibitive tariff walls agaiiist foreign wheat and the ever-increasing domestic production enabled. European countries so to reduce their import requirements that the entire world situation was affected. I should like to place on Hansard figures of the wheat imported by all European countries from 1930 to 1935:
1930-	31....
1931-	32....		
1932-	33	
1933- 34	;; ;; ;; ;;
1934-	35 (to June 30, 1935) . . . !
Bushels
786.000.	000
770.000.	000
615.000.	000
523.000.	000
525.000.	000
The importing countries of Europe were endeavouring at all costs to become self-sufficient, and the high grade wheat of western Canada, which formerly commandied high prices because of its quality, became more and more ignored. At the same time cheaper wheats of lower quality from other countries were being substituted on a larger scale. This resulted in the building up of a huge surplus in Canada, but practically all political economists were agreed that the day would come when this surplus would be needed.
In their mad desire to become self-sufficient, practically every European country subsidized its farmers; and improved methods of land fertilization brought about increased yields. Even Sweden had a surplus of wheat of inferior quality, which was sold on the English market. Our highly developed and efficient wheat producing areas in Canada were competing with Poland, Russia, the Argentine, Australia and Roumania. In addition, we were met with bounties on wheat in Great Britain,

The Budget-Mr. Hayhurst

!
one year and compare it with the corresponding period in another year. In order to be fair, I think the hon. member (Mr. Brooks) should have followed the same procedure in giving his figures. When he gave the figures for October, 1935, he should also have given the parallel figures for October, 1936.


Mr. BROOKS:: I stated that the latest figures I was able to get were for February, 1936.


Mr. ISNOR:: I quite appreciate that the hon. member made that statement. I should like to give the house the correct figures so that it will have the true picture before it of unemployment in our section of the country.
The hon. member stated that in October, 1935, there were 14,438 on relief in Nova Scotia. Those are the figures submitted to me by the unemployment relief branch. They are divided as follows: 2,804 heads of families and 11,634 others. The figures for October, 1936, show 6,171 unemployed, made up of 1,396 heads of families, and 4,775 others. There is a marked difference. Hon. members will see the decided improvement which has taken place when the figures for October, 1936, are compared with those for October, 1935. I know the hon. member had no desire of presenting these figures in an unfair way, and I hope he will pardon me for making this correction.
I turn now to the budget. It was my privilege during the past ten days to make a visit down east. When I travel on a train I do not make a habit of using a drawing room; I like to mix with people from whom I am likely to gain information. I go from the smoker to the first-class coach, and then into the pullman, and so on, and so I was able to get, in an interesting way, the reaction to the budget presented by the Minister of Finance. The reaction was such as to give me as a business man a lot of encouragement to carry on.
This afternoon the hon. member for Waterloo South (Mr. Edwards) said that he wanted to deal with the budget in a strictly businesslike manner. I desire to speak, not as a representative of one of the important centres of eastern Canada, Halif ax; nor as one who has always taken an active interest in board of trade matters in the city of Halifax; nor do I desire to speak as a business man; I desire to speak simply as a citizen of Canada and to express my appreciation to the Minister of Finance for his very able presentation of the budget. There are many pleasant things from a business standpoint disclosed in that budget. Not alone should the Minister of Finance be complimented; I believe some of the credit

belongs to the Prime Minister (Mr. Mackenzie King) and the members of his cabinet, who by their cooperation in concluding trade agreements with the United Kingdom and our neighbour to the south have made it possible for the minister to present a financial picture which certainly should, to use his own words, bring cheer and prosperity to the whole nation.
I am going back a few years to review the financial structure from the time of the golden era which began in 1896. In 1897 a budget of $38,000,000 was presented by the late Hon. W. S. Fielding, that Nova Scotian who stood so high in the esteem of the people of Canada. In 1913 a budget of $112,000,000 was presented by Sir Thomas White. Passing along to the year 1932, we find that the budget was presented by the Hon. E. N. Rhodes, who estimated revenues at $311,735,000. Finally we come down to the Dunning budget of 1936, amounting to $452,123,000. I wish to show that the present budget represents a surplus this year. In doing so, I would mention that in 1932 the total revenue was $311,735,000, and ordinary expenditures $354,643,000, showing a deficit for the year of $42,908,000. Turning to the picture to-day we find an estimated revenue of $452,123,000, and an expenditure of $391,860,000, leaving a surplus of $60,307,000. Over the short period of four years there is a change in the financial picture from a deficit to a surplus representing a turnover of $103,171.000. Surely the people of Canada placed their trust in the right man as Minister of Finance when they sent to parliament the Hon. Charles A. Dunning.
Hon. members on the other side will immediately turn their thoughts to where the revenue comes from. I admit it comes from the pockets of the people. You cannot get it otherwise than through taxes. If you are going to spend a certain amount in business you must take it in before you can spend it if you are doing business on sound lines.
May I point out one or two items which naturally will come to our attention. First, there is an increase in income tax from approximately $82,000,000 to $102,000,000, and in sales tax from $77,552,000 to $115,500,000. It seems to me that this increase is necessary if the government is to carry out the request made to the Minister of Finance by the Canadian chambers of commerce that no unnecessary expenditures should be undertaken and that a closer relationship be established between revenue and expenditure, even if this necessitated increased taxation. That request was made last year. But what do we find this year? Not a single tax has been added,

The Budget-Mr. Isnor
and yet a very much brighter financial picture is presented to the Canadian people. I believe that business men throughout the dominion will welcome this budget and will regard it as having done much to restore confidence in our business institutions.
The hon. member for Waterloo South (Mr. Edwards) questioned to-day the wisdom of restoring the five per cent salary cut to the civil service employees. I take an altogether different view. I believe it will be accepted generally throughout the dominion as a move in the right direction. It will release something like $3,000,000 of purchasing power, to be disposed of by large numbers of people who are not hoarders of gold but who will put into circulation their increased spending power. On the whole, from a business standpoint, instead of being criticized the government should be commended for restoring the cut. I am reminded of some words of Ella Wheeler Wilcox which I copied from the wall of a restaurant the other evening, while waiting for my meal:
Don't look for the flaws when going through life, And even when you find them
It is wise enough to be somewhat blind And look for the virtue behind them.
I commend the thought contained in those lines to hon. members opposite who during the last ten days have persisted in looking for flaws and searching for omissions in the trade agreements, rather than recognizing the benefits to be derived through them in increased business and employment.
May I briefly touch upon the matter of grants for assistance to the prairie provinces, and more particularly to the agricultural interests, as compared with the amounts provided to help the fishermen or the fishing industry. I have the figures since 1920. but I do not propose to read them all. For instance, in 1920-21 we find that $1,275,000 was devoted to fisheries; as against that we spent $3,903,000 on agriculture. Right down the line one finds very little variation in the votes so far as fisheries are concerned, until in 1936, as compared with 1935, we find a decrease instead of an increase. In 1935-36 the amount voted for fisheries was $1,753,012, and for 1936-37 the amount was only $1,407,900.
Let us compare that with the increases for agriculture. In 1921 we spent $3,903,000 on agriculture, and last year $7,117,341.39. If there is need for this amount of money I have no objection. I am not one of those who believe in bonuses and subsidies as a rule, but if the prairie provinces need the assistance then I say it is good business. But if you do it in the one case, it is also good business to do it in the other, when our fisheries show
such a decline in production. We do not ask that these moneys be given to our fishermen m the form of a dole or relief. What we do ask, what we press for-and I support the hon. member for Shelburne-Yarmouth-Clare (Mr. Pottier) in his plea-is enlarged markets. We believe that if the government makes provision whereby we can secure enlarged markets then the fishermen will take care of themselves.
Possibly we in the maritime provinces have not said enough; perhaps we have not said as much about the fisheries as the prairie provinces have said about wheat. We may be to blame in that regard, but this year we are united. We are demanding of the government more serious consideration for the maritime provinces in the east, and that applies also to the maritime province in the west. We are asking for serious consideration, and if markets are provided for us we will take care of ourselves.
Just one more figure in connection with agriculture. I find that including the special supplementary estimates, the .sum of $10,090,-4S1.65 is to be expended this year on agriculture. What do we find in connection with the fisheries? Compare $10,000,000 for agriculture with $2,194,582 for fisheries, including the fishing bounty and the supplementary estimate. And when the $500,000 is brought forward in the special supplementary estimates for promoting the fisheries of the maritime provinces, the statement is at once made: Once again the maritimes are digging into the treasury. These figures will show what we have to contend against. We have no fault to find with the west, but we do ask in all sincerity that the west give us its support.


An hon. MEMBER:: We have been keeping the east too long.


Gordon Benjamin Isnor: Somebodv says, "We have
been keeping the east too long." I do not know who said that, but I dare him to stand up and repeat it. All I can say is, I am glad he is alone on the other side, for I do not believe his colleagues share that opinion. I am surprised that any hon. member should take the stand in this house that we in the east have been treated in too friendly a manner, that we have been treated too kindly. Surely the hon. gentleman who made the remark cannot mean that. Where would the west be if it were not for the east? We have sent able men from the east to every part of Canada. We, in the east, are not conceited, but in years gone by we did send the brains of the country to different parts of Canada. I hope the hon. gentleman will read a little history and become acquainted with what the east has done for the rest of Canada.
The Budget-Mr. Isnor

I should like to discuss the railways and die national harbours board, but I will leave that until the appropriate estimates are before us. I believe, however, that it is very necessary, as one member said this evening, that we should face the problems of the railways and taxation.
Before getting away from the budget I wish to refer to a matter I discussed when the post office estimates were before the house. Looking at the expenditures tabled by the Minister of Finance, I find a surplus shown in the Post Office Department. I repeat, that until we have a true financial picture showing on one side of the balance sheet the total revenue, derived from all sources, credited to the Post Office Department, and on the other side the total expenditures, including all rentals and all incidentals, the people will not have a proper idea of the financial standing of this branch of government. If it is necessary to set up, as has been done in the public accounts, a balance sheet reflecting the affairs of the dominion as a whole, then I suggest that each one of the departments should be shown in a similar manner so that we might know whether a particular department was paying its way or not.
On behalf of the people of Halifax I extend to both the former and the present administration their thanks for the splendid new building recently erected in our city to house the post office and other government branches. So often we fight for some particular project, and then forget to thank those who provided us with that facility. In Halifax we have a very fine building. It was badly needed, although I doubt very much whether it will be large enough; but in any case I wish on behalf of the people to extend our thanks for it.
On behalf of the people along our rugged coast line I should also like to thank the Minister of Public Works (Mr. Cardin). A great many members do not realize the hardships, which the fishermen undergo. This has been touched on upon more than one occasion, but I wish that hon. members could travel with me along those rugged shores of Nova Scotia. I was privileged last summer, when the Canadian Bar Association held its convention in Halifax, to welcome several members of this house and to show them some of what we at any rate regard as scenic beauty spots in our province. I should like to take hon. members into the fishing villages, so that they might see for themselves just how our fishermen exist. The conditions were described by the hon. member for Shelburne-Yarmouth-Clare yesterday.

I mention this to bring home to the Minister of Public Works the fact that in providing breakwaters for these people he and the government have on more than one occasion saved the life savings of the fishermen of these communities. Let me picture a small settlement of perhaps fifteen fishermen. Gradually a wall has been raised which closes them in with the exception of a very small opening through which they sail out to the fishing grounds. I can point to any number where there is just enough space to enter and leave that shelter. I particularly stress this, in order that when we make a request on behalf of these people, the minister may give it very favourable consideration, not looking solely at the dollars that it is going to cost, but rather to the effect it is going to have in making it possible for those people to continue to provide for themselves and their families.	I wish to express my thanks to
the minister for what he has done, looking also to building in the future those breakwaters that are so sorely needed along certain sections along our coast line.
I have mentioned one distinguished Nova Scotian this evening, the late Hon. W. S. Fielding, and I should like now-and I know I am speaking the thought in the minds of many hon. members-to express our regret at the illness of a former Minister of Finance, Hon. E. N. Rhodes.
In conclusion, Mr. Speaker, may I be permitted again to express appreciation to the Minister of Finance, the Prime Minister, and the members of his cabinet for a budget which I believe signifies great progress towards the solution of two great problems, those of reducing the annual deficit and lessening the need to expend huge sums on unemployment. I would ask that further consideration be given to these two subjects during the present year, as unless we find a solution for them we shall not see the happy and prosperous days that we hope are before Canada. Even a partial solution of these two great problems would give great hope to the taxpayer and a sense of cheer to all Canadians. I believe a door of hope and cheer has been opened by the Minister of Finance, and I congratulate him upon his splendid forward step in the direction of recovery.


Mr. W. G. CLARK (York-Sunbury):: 
Alfred Johnson Brooks: Would the hon. member say that this would apply in every case in New Brunswick?


William George Clark: No, it would not apply in every case. In the latter part of 1934 the original owner, having recovered his health, returned home and took a look over the farm. He wias greatly worried, and said to the purchaser, "Why, you have not done as you agreed, and I must take back this farm and the stock right away." But the purchaser, under bill of sale and mortgage, replied, "Oh, you cannot get back the farm now; I have come under the Farmers Creditors' Arrangement Act. The official receiver was here and he said I did not have to pay for the farm, that I could keep it and keep the stock as well, and that I could make the implement firm stand .a heavy loss on the hay press." By the way, the official receiver who did the greatest business in my county was an organizer for the 'Conservative party. He went about soliciting business under the Farmers' Creditors Arrangement Act.
So the original owner went to see his good friend the lawyer, and said, "Surely it cannot be true that I am going to lose my farm and stock." But the lawyer said, "I am afraid it is true. The Bennett government passed an act making it possible for farmers in debt to hold the farm and the stock." But, he was told, the board of review still had to consider
1718	COMMONS
The Budget-Mr. Clark (Sunbury)
the matter. The board of review, however, took a narrow view of the law; they did not agree with their lordships of the privy council, who said:
To deal first with the last contention, their lordships are clearly of opinion that section 7 does not enable any creditor to be deprived of his security.
Under the view taken by the board of review in New Brunswick, however, creditors were deprived of their security and could not get their property back at all. The New Brunswick board1 has changed its views slightly now, but the same judge is still chairman of the board. The case was considered by that board one day; it was adjourned to another day, and judgment was rendered on still another day. When judgment finally was delivered1 the board said there should; be a reduction of the mortgage by $1,000, that the interest should be reduced to five per cent, and that the man who had bought the farm should pay $125 within a year, making further payments at a later time. No arrangements were made to see that this was carried out, just as in hundreds of cases no arrangements have been made to make sure the decisions of the board were followed. It simply means that dishonest people consider that they do not have to pay at all when they come under the Farmers' Creditors Arrangement Act. In this case the original owner saw that it was hopeless to expect ever to get his farm or stock back again, so he lost the living he had worked so hard to obtain. The farm was really given to one who was unworthy of it, and the original owner fairly worried himself to death. And during a campaign speech in 1935 the then leader of the government referred to this act as the one of which he was proudest.


Alfred Johnson Brooks: If I may interrupt the hon. gentleman, -his objections to the Farmers Creditors' Arrangement Act seem to be on account of the fact that he is a dealer in farm machinery, and for that reason he has lost a very considerable amount through the act.


William George Clark: That is not my only reason. There is no doubt that I have lost a great deal of money, but I know of many other cases. Tradesmen throughout New Brunswick have spoken to me time and again about the difficulties they have had and the injustices they have suffered under this act.


Jean-François Pouliot: And the farmers have lost their credit.


William George Clark: The act
brought about a drying up of credit on the part of private individuals having money available. They would not accept farm mortgages, nor would they give credit to farmers.

Many of our people who have money leave it in the banks at one and a half per cent because they are afraid to put it out on mortgages. Personally I do not believe the government should be loaning money on mortgages; in fact, I do not believe the government should be lending money at all. It is all right for the government to spend money on public works in order to keep people employed; it is all right for the government to have great schools in which to train supervisors to show people how to farm, how to market, how to cook and how to live, but what good does it do to make loans to farmers who come forward with proposals such as those I am going to mention?


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Friday, March 12, 1937